May 09

Today’s News 9th May 2021

  • Three Shot In Times Square Including Four-Year-Old Girl
    Three Shot In Times Square Including Four-Year-Old Girl

    New York’s Times Square was temporarily cordoned off on Saturday after at least three people were injured in a shooting, according to NBC News, citing police. The suspect, pictured below, was caught on camera.

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    The victims, a four-year-old girl, a 23-year-old and a 43-year-old received non-fatal wounds after one of four men involved in an altercation drew a gun around 5 p.m. and opened fire. All of the victims were bystanders, while the little girl underwent surgery and is expected to survive.

    “Two shots. They was bleeding the toddler was bleeding and the mom was crying,” said one Times Square vendor.

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    It is unclear what the dispute was over which led to the shooting. No suspects have been detained. The shooting came just one hour before a scheduled rally in memory of Daunte Wright, a black man who was fatally shot by a police officer in Minnesota in early April. Police have not linked the shooting to the event at this time.

    There have been 416 shootings in New York City through May 2 of this year, up 83% from this time last year when everyone was locked down, accordsing to police data.

    “A child in one of the top tourist spots in the world on a spring Saturday isn’t safe from this nation’s gun violence epidemic,” said local TV reporter Steve Keeley of Fox29.

    The shooting comes amid a spate of attacks against asians committed primarily by black suspects. Last Sunday, two Asian women were assaulted by a black woman wielding a hammer – leading to one of the victims, a 31-year-old Taiwanese woman, being hospitalized with a head wound.

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    Tyler Durden
    Sat, 05/08/2021 – 23:45

  • Kauai Real Estate In Total Frenzy As Buyers Snap Up Multi-Million Dollar Homes Sight-Unseen
    Kauai Real Estate In Total Frenzy As Buyers Snap Up Multi-Million Dollar Homes Sight-Unseen

    Real estate on the no-longer sleepy island of Kauai has gotten so hot that people are buying multi-million dollar homes sight-unseen, as the pandemic-fueled housing boom continues seemingly unabated.

    Canadian entrepreneur Brent Naylor and his wife, Gayle Naylor, are selling their North Shore Kauai property for $22.75 million. David Tonnes/Panaviz Photography

    According to the Wall Street Journal, luxury properties on Kauai – with a population of 72,000 permanent residents – start at $3 million, while just 3% of the island’s 550 square miles are open to development, meaning that housing stock in all categories is scarce. And according to the report, Californians looking for primary and secondary homes are squeezing prices even higher.

    Ms. Cook, 46, a former commercial real-estate broker, and her husband, 51, a lawyer, had considered looking for a new home in the suburbs north of San Francisco, but were reluctant to test their luck in a seller’s market, where all-cash deals and multiple bidders had become the rule.

    “I looked at him,” says Ms. Cook, “And I said, ‘OK, great, when are we leaving?’ ”

    The Cooks made an offer of $1.8 million, sight unseen, on a furnished three-bedroom, three-bathroom bungalow located on Kauai’s North Shore, which is known for its verdant mountains and beautiful beaches. The 2,200-square-foot house, with a great room that opens to the outdoors, is on a ¼-acre lot that is a five-minute drive from the ocean. The couple and their two boys, now 4 and 5 years old, moved in time for Thanksgiving. -WSJ

    Kauai, once a sleepy and very rainy destination, has become the state’s prime destination for luxury-minded homeowners – with Mark Zuckerberg and wife Priscilla Chan having snapped up 1,400 contiguous acres – including approximately 600 acres just purchased in March, according to a family spokesman.

    Matthew G. Beall, CEO of Hawai’i Life real-estate, says the island’s residential sales above $3 million went from 23 in 2019 to 38 last year, and that 2020’s top sale on the island (and all of Hawaii in fact), was a 1.7 acre waterfront compound on Hanelai Bay on the North Shore of Kauai.

    The home has eight bedrooms and 10 bathrooms spread across three structures. It sold for $36.7 million last April in an all-cash deal to an undisclosed buyer. The agent on the sale, Neal Normal of Hawai’i Life’s luxury platform, says that more buyers are making pandemic-era offers without a viewing. Last year, he said that of the 30 or so residential sales he handled with an average price of around $10 million, six were sold sight unseen. In his previous 30 years as an agent, just one listing was bought without a viewing.

    Despite some 80 inches of rain per year (and 360 inches at the center of the island at Mount Awialeale – over 5,000 feet above sea level), Kauai’s North Shore has become the island nation’s most expensive market, according to the Big Island’s Rebecca Keliihoomalu – VP of Corcoran Pacific Properties.

    Last year, there were six residential sales on the island north of $10 million, compared to just two in the Wailea-Makena area of southwest Maui, and three above Honolulu.

    That said, buying properties on Kauai is not without risks.

    “Every year we have two or three floods,” said Kauai landscaper Brandon Miranda, a third-generation islander, whose home-care and landscaping business looks after high-end estates for second-home owners.

    “Everyone wants to be on the beach,” says Miranda. “But this is a tropical environment and all that moisture causes problems,” which affect everything from electrical outlets to AC units – on top of the flooding.

    This spring, Kauai and other islands were hit by torrential rains and isolated flooding. A resulting mud slide has impeded access to Hanalei. Mr. Miranda says local Hanalei owners can expect problems for months to come.

    What Mr. Miranda calls super-high-maintenance homes sit on what Hawai’i Life’s Mr. Beall calls “one of the most incredibly beautiful places on the planet.” -WSJ

    Just months ago, one Hanalei oceanfront five-bedroom house sitting on 1.11 acres went on the market for an asking price of $24.75 million.

    Another home on the market belongs to Canadian entrepreneur Brent Naylor, 75, and his wife Gayle, 74. They bought an empty 4/5 of an acre lot perched above Hanelai for $1.6 million, then proceeded to spend around $18 million to construct an 8,200 sqft four-bedroom house, which includes an outdoor kitchen and a 1,200 sqft master suite with a fireplace and private terrace.

    It’s been listed for sale for over 200 days at $22.75 million – so perhaps even Hawaii’s hottest market has limits.

    Tyler Durden
    Sat, 05/08/2021 – 23:30

  • Turn Over Routers Or Face Subpoenas, Arizona Lawmakers Tell Maricopa County
    Turn Over Routers Or Face Subpoenas, Arizona Lawmakers Tell Maricopa County

    Submitted by Zachary Stieber

    Votes are counted by staff at the Maricopa County Elections Department office in Phoenix, Ariz., on Nov. 5, 2020.

    Legislators in Arizona and officials in the state’s largest county clashed anew this week over election audit subpoenas, with county officials refusing to hand over routers and claiming they do not have passwords to access administrative control functions of election machines.

    Arizona’s Senate told Maricopa County on Friday that it would issue subpoenas for live testimony from the county’s Board of Supervisors unless it received the materials that are being withheld. “We’ve been asked to relay that the Senate views the County’s explanations on the router and passwords issues as inadequate and potentially incorrect,” a lawyer for the Senate said in an email to county officials.

    The Arizona Senate subpoenaed a slew of election materials, such as ballots, following the 2020 election. Lawmakers also issued subpoenas for election machines, passwords, and other technology.

    Maricopa County alleged in a lawsuit that the request for materials was overly broad and threatened voter privacy. A judge, though, ruled that they were “the equivalent of a Court order.” But the county said this week it is not turning over routers or router images, claiming that doing so poses a significant security risk to law enforcement.

    The county has also informed the Senate’s audit liaison, former Republican Secretary of State Ken Bennett, that it does not have passwords to access administrative functions on Dominion Voting Systems machines that were used to scan ballots during the election.

    “They’ve told us that they don’t have that second password, or that they’ve given us all the passwords they have. They’ve also told us that they now can’t, as they promised a couple weeks ago, provide our subcontractors with the virtual access to the routers and hubs and other things at the Maricopa County tabulation and election center, as was part of the subpoenas,” Bennett told One America News at the site of the audit in Phoenix.

    John Brakey, a Democrat who is serving as an assistant to Bennett, told the broadcaster that he was “blown away” by the password development.

    “It’s like leasing a car and they refuse to give you the keys. They’re supposed to be running the election. You know what’s wrong? Sometimes these vendors have too much power, and we’re voting on secret software, and that’s why this recount down here is very important,” he added.

    Jack Sellers, the Republican chairman of the Maricopa County board, said Friday that he is angered by allegations of corruption and would not address every allegation, but would speak to the password issue.

    “The specific password and security tokens Ken Bennett referenced this week provide access to proprietary firmware and source code. Elections administrators do not need to access this information to hold an election, and we do not have it in our custody,” he said in a statement.

    Contractors working for Florida-based company, Cyber Ninjas, which was hired by the Arizona Senate, audit ballots at Veterans Memorial Coliseum in Phoenix, Ariz., on May 6, 2021.

    The county board called an emergency meeting later on Friday. The board was going to consider legal advice and litigation regarding its non-compliance with the Senate subpoenas.

    In a response to the Senate’s lawyer, Allister Adel, Maricopa County’s attorney, said that the county has “already produced every password and security key for the tabulators that is [sic] within the County’s possession.”

    “It does not have any others,” Adel added. The county is working to figure out if there is “a safe manner” to get the Senate information from the routers without risking non-election data.

    Dominion, whose machines are used in about half of U.S. states, did not respond to a request for comment. The company has said it supports forensic audits by federally-accredited laboratories and that Cyber Ninjas, which is leading the Arizona audit, is not verified. Both Dominion and Sellers noted that Maricopa County contracted its own audits, one for machines and another for ballots.

    But Brakey, the assistant Senate liaison, has called the description of those audits misleading. The ballot batches were picked beforehand and auditors only analyzed a small percentage of the ballots cast in the election, he said, while the machine testing could only determine whether the technology was working well at the time of the review.

    “They claim that’s an audit. I call it fatally flawed,” he told One America News.

    Maricopa County Sheriff Paul Penzone, meanwhile, joined other county officials in decrying the Senate’s attempt to obtain the routers.

    “Its most recent demands jeopardize the entire mission of the Maricopa County Sheriff’s Office,” he said in a statement.

    “We are talking about confidential, sensitive, and highly-classified law enforcement data and equipment that will be permanently compromised. The current course is mind-numbingly reckless and irresponsible. I look forward to briefing them on the horrendous consequences of this demand and the breadth of its negative impact on the public safety in this County.”

    Tyler Durden
    Sat, 05/08/2021 – 23:00

  • Justice Dept. Proposes New Rule To Serialize "Ghost Gun" Kits 
    Justice Dept. Proposes New Rule To Serialize “Ghost Gun” Kits 

    President Biden has promised to defeat the National Rifle Association and wage war on ghost guns in his first hundred days. He appears to be making good on both, as the Justice Department on Friday released a proposed rule that changes the definition of a firearm to require 80% lower kits to include serial numbers, according to AP News. 

    The proposed rule change comes as President Biden has declared war on “ghost guns.” These weapons have unserialized lower receivers (the regulated part of a gun) that can be easily bought in a kit form online or at a gun store (without a background check), and in a few hours, with some drilling and additional fabrication, can be transformed into a fully functional weapon after the upper receiver (unregulated part of the gun) is attached. 

    The federal government is terrified as the popularity of ghost guns has increased over the years. Anyone can buy 80% lower kits online and watch a few YouTube videos, and have a working lower receiver after trigger parts are installed, totally untraceable to the government. These weapons have become popular with gangs and other criminals and have been turning up in more violent crimes across the country.

    Between 2016 to 2020, the DoJ estimates about 23,000 ghost guns were seized by law enforcement agencies across the country, and some were identified to be connected with homicides or attempted homicides.

    A senior Justice Department official told AP the proposed rule sets forth several factors in determining whether the unfinished lower receiver could be easily convertible into a working firearm. The official said if the lower receiver meets that criteria, manufacturers will be required to include a serial number. The rule would also require serial numbers attached to un-serialized weapons traded in or turned into federal firearms dealers.

    “Criminals and others barred from owning a gun should not be able to exploit a loophole to evade background checks and to escape detection by law enforcement,” Attorney General Merrick Garland said in a statement. “This proposed rule would help keep guns out of the wrong hands and make it easier for law enforcement to trace guns used to commit violent crimes, while protecting the rights of law-abiding Americans.”

    There was no mention of 3D-printed ghost guns that can be entirely manufactured at home. The 9th U.S. Circuit Court of Appeals in San Francisco recently reinstated a Trump administration order that authorized removing ghost guns from the State Department’s Munitions List. This allowed untraceable 3D-printed gun blueprints to be shared online. 

    Regulating 80% lower kits might be an easy task for the Biden administration. They will have a near-impossible time regulating 3D-printed guns that can be entirely printed at home. 

    Tyler Durden
    Sat, 05/08/2021 – 22:30

  • Beijing's Elusive Bid For Pricing Power On Rare Earths
    Beijing’s Elusive Bid For Pricing Power On Rare Earths

    Authored by Damien Ma via MacroPolo.org,

    From ventilator and chip shortages to what kind of ships traverses through which canals, the linkages and nodes of the global economy have rarely been in the spotlight as much as they have over the last 12 months. Many of these disruptions are short-term ones, but they have also brought attention to longstanding challenges of supply chain resilience and dependence.   

    One of those challenges is that of China’s grip on rare earth elements (REEs), a key input in permanent magnets that are in everything from smart phones and wind turbines to electric vehicles and missile guidance systems.   

    Figure 1. REE Demand for Permanent Magnets by Application, 2010-2025  

    Source: Statista estimates; Quest Rare Minerals.  

    This is not the first time these 17 elements that sit at the bottom of the periodic table have raised alarm from Tokyo to Washington. Back in 2010, Beijing was roundly accused of embargoing REE exports to Japan as Sino-Japan relations soured.  

    At the time, China was responsible for some 90%-plus of REE supplies globally, even though its estimated reserves are around just 25%-33% of the global total. Given the wide belief in Japan and the United States—which also happen to be the largest importers of REEs—that China could weaponize this resource, its supply monopoly raised hackles and intensified calls for diversification. 

    A decade since, has much changed? I had trekked to Inner Mongolia’s Baotou Rare Earth Hi-Tech Zone back in 2010 to gain more insight into China’s designs on the REE industry and how that affected the global market. It’s worth revisiting this industry now to understand how its dynamics shaped Beijing’s thinking and intent on managing this resource.  

    “Selling gold for the price of radishes”  

    China has long viewed REEs as a strategic resource, with the industry’s development spurred by a quip supposedly attributed to Deng Xiaoping: “The Middle East has oil, but China has rare earths.”  

    Yet as China became the dominant supplier of REEs over subsequent decades, it saw the price of REEs plummet, hardly the price-setting influence that an OPEC exerted on oil prices. That frustrated the economic nationalists in Beijing, grumbling that China was essentially “selling gold at the price of radishes.”   

    Much of that frustration stemmed from the government’s inability to regulate a wild industry that was rife with smuggling. At one point in 2011, it was estimated that there was a gap of 120% between REE volumes that China officially exported and what other countries imported. Meanwhile, REE mining was also exacting a hefty environmental toll.  

    The Chinese government decided it needed to consolidate the REE industry. Beijing thought it could clean up the illegal business, while also receiving some of that price-setting power that has long eluded it. What’s more, the move also dovetailed with rolling out the original “strategic emerging industries” initiative, the start of China’s effort to indigenize supply chains and move up the value chain.  

    In other words, why export this resource for pennies when China should keep more of it for its own tech industries of the future?  

    This is where Baotou comes into play. Part of the industry restructuring was intended as a “resource for technology” play. That is, instead of exporting REEs, China did what it knows best: set up zones to attract high-tech manufacturing investment in exchange for easy access to critical materials. Baotou, of course, was and still is China’s largest production base of REEs.   

    Did the strategy work?  

    Although economic nationalist in orientation, China’s REE policy was a far cry from banning exports (see Figure 2). The stringent export quotas in the 2011-2012 period certainly drove a spike in prices, but that was short-lived. By 2014, it became apparent that China was ramping up exports rather than reducing them, and prices quickly corrected and have remained relatively low since. The reality reflects Beijing’s perennial struggle in imposing its will on a fragmented, messy, and profit-driven industry.  

    Figure 2. China’s REE Exports Have Not Declined Over Last Decade 

    Source: Wind. 

    It is also not entirely clear whether an actual embargo took place in 2011 or whether it was the result of Beijing’s export quotas. But whatever the judgment in hindsight, the damage has already been done to China as a reliable supplier of REEs, leading to gradual resource diversification. China is now just under 60% of global REE production (see Figure 3).  

    Figure 3. Global Share of REE Production (in tons)

    Source: US Geological Survey.

    The relative abundance of REE reserves globally, it turns out, means that China’s bid for price-setting power rested on faulty assumptions of its leverage. Despite national security hawks’ continued pitch for exercising pricing power, Beijing seems to have recognized that it no longer has a monopoly on production.  

    Instead of obsessing over what’s in the ground and how much to sell it for, China appears to have shifted tactic to redouble its effort on developing the midstream REE processing industry and downstream end products like magnets.  

    A clear indication of that focus was President Xi Jinping’s recent visit to Jiangxi—a major hub of REE production. Rather than a mining operation, Xi toured JL Mag, a downstream company that supplies magnets to the likes of Goldwind and BYD. We will look further at the midstream and downstream dynamics of the REE industry in future analysis. 

    Tyler Durden
    Sat, 05/08/2021 – 22:00

  • NATO Allies "Take Over" Black Sea For Military Exercises
    NATO Allies “Take Over” Black Sea For Military Exercises

    Authored by Rick Rozoff via AntiWar.com,

    The title is courtesy of the Hungary-based Transylvania Now news site. The Pentagon’s Special Operations Command Europe kicked off the Trojan Footprint 21 exercise on May 3; what is identified as its premier special operations forces drills.

    The war games will be held until May 14 in five Black Sea and Balkans nations: Bulgaria, Georgia, Montenegro, North Macedonia and Romania. Special forces from the U.S. – all branches of the armed forces including Green Berets – the five host nations, Britain, Germany, Spain and Ukraine are involved. With the exception of Turkey, all Black Sea littoral states but Russia are participating.

    Prior Black Sea naval maneuvers, file image

    The exercise is designed for “enhancing interoperability between NATO allies” to prepare for “counter[ing] myriad threats.” Though there aren’t a thousand… only one threat. Russia.

    Just as it is all-service so it is “all-domain” with air, land and sea forces engaged in combating an unnamed adversary in the Black Sea. One which has a fleet based in Sevastopol in Crimea.

    “While the exercise is focused on improving the ability of SOF to counter a myriad of threats, it also increases integration with conventional forces and enhances interoperability with our NATO allies and European partners,” Col. Marc V. LaRoche, Deputy Commander, U.S. Special Operations Command Europe described in a statement. “Most importantly, Trojan Footprint fortifies military readiness, cultivates trust, and develops lasting relationships which promote peace and stability throughout Europe.”

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    Trojan Footprint 21 is occurring simultaneously with the massive DEFENDER-Europe 21 war games in the same area and ahead of the Steadfast Defender exercise, also to be held in the Black Sea region.

    Tyler Durden
    Sat, 05/08/2021 – 21:00

  • Chinese Military Discussed Weaponizing COVID In 2015 'To Cause Enemy's Medical System To Collapse'
    Chinese Military Discussed Weaponizing COVID In 2015 ‘To Cause Enemy’s Medical System To Collapse’

    In 2015, Chinese military scientists discussed how to weaponze SARS coronaviruses, five years before the COVID-19 pandemic emerged in Wuhan, China – where CCP scientists were collaborating with a US-funded NGO on so-called ‘gain of function’ research to make bat coronaviruses infect humans more easily.

    In a 263-page document, written by People’s Liberation Army scientists and senior Chinese public health officials and obtained by the US State Department during its investigation into the origins of COVID-19, PLA scientists note how a sudden surge of patients requiring hospitalization during a bioweapon attack “could cause the enemy’s medical system to collapse,” according to The Weekend Australian (a subsidiary of News Corp).

    It suggests that SARS coronaviruses could herald a “new era of genetic weapons,” and noted that they can be “artificially manipulated into an emerging human ­disease virus, then weaponized and unleashed in a way never seen before.”

    The chairmen of the British and Australian foreign affairs and intelligence committees, Tom ­Tugendhat and James Paterson, say the document raises major concerns about China’s lack of transparency over the origins of COVID-19.

    The Chinese-language paper, titled The Unnatural Origin of SARS and New Species of Man-Made Viruses as Genetic Bioweapons, outlines China’s progress in the research field of biowarfare.

    “Following developments in other scientific fields, there have been major advances in the delivery of biological agents,” it states.

    “For example, the new-found ability to freeze-dry micro-organisms has made it possible to store biological agents and aerosolise them during attacks.”

    Ten of the authors are scientists and weapons experts affiliated with the Air Force Medical ­University in Xi’an, ranked “very high-risk” for its level of defence research, including its work on medical and psychological sciences, according to the Australian Strategic Policy Institute’s ­Defence Universities Tracker.

    The Air Force Medical University, also known as the Fourth Medical University, was placed under the command of the PLA under President Xi Jinping’s military reforms in 2017. The editor-in-chief of the paper, Xu Dezhong, reported to the top leadership of the Chinese Military Commission and Ministry of Health during the SARS epidemic of 2003, briefing them 24 times and preparing three reports, according to his online ­biography. -The Australian

    The editor-in-chief of the paper, Xu Dezhong, reported to the top leadership of the Chinese Military Commission and Ministry of Health during the SARS epidemic of 2003. (via The Australian)

    “We were able to verify its ­authenticity as a document authored by the particular PLA ­researchers and scientists,” according to Robert Potter, a digital forensics specialist who has worked for the US, Australian and Canadian governments – and has previously analyzed leaked Chinese government documents, according to the report. “We were able to locate its genesis on the Chinese internet.”

    Former US Secretary of State Mike Pompeo and his chief China adviser, Miles Yu, referenced the document in a February op-ed in the Wall Street Journal, writing that “A 2015 PLA study treated the 2003 SARS coronavirus outbreak as a ‘contemporary genetic weapon’ launched by foreign forces.”

    And according to Peter Jennings, executive director of the Australian Strategic Policy Institute, “There is no clear distinction for research capability because whether it’s used offensively or defensively is not a decision these scientists would take,” adding “If you are building skills ostensibly to protect your military from a biological attack, you’re at the same time giving your military a capacity to use these weapons ­offensively. You can’t separate the two.”

    The study also examines the optimum conditions under which to release a bioweapon. “Bioweapon attacks are best conducted during dawn, dusk, night or cloudy weather because intense sunlight can damage the pathogens,” it states. “Biological agents should be released during dry weather. Rain or snow can cause the aerosol particles to precipitate.

    “A stable wind direction is ­desirable so that the aerosol can float into the target area.”

    Among the most bizarre claims by the military scientists is their theory that SARS-CoV-1, the virus that caused the SARS epidemic of 2003, was a man-made bioweapon, deliberately unleashed on China by “terrorists”. -The Australian

    News of the document follows a May 3 report that the Wuhan Institute of Virology was working with the Chinese government in a team which comprised five military and civil experts, “who conducted research at WIV labs, military labs, and other civil labs leading to “the discovery of animal pathogens [biological agents that causes disease] in wild animals,” according to the Epoch Times.

    And as we noted in March, the US National Institutes of Health (NIH) – headed by Dr. Anthony Fauci, “had funded a number of projects that involved WIV scientists, including much of the Wuhan lab’s work with bat coronaviruses.”

    In 2017, Fauci’s agency resumed funding a controversial grant to genetically modify bat coronaviruses in Wuhan, China without the approval of a government oversight body, according to the Daily Caller. For context, in 2014, the Obama administration temporarily suspended federal funding for gain-of-function research on bat coronaviruses. Four months prior to that decision, the NIH effectively shifted this research to the Wuhan Institute of Virology (WIV) via a grant to nonprofit group EcoHealth Alliance, headed by Peter Daszak.

    Peter Daszak, president of EcoHealth Alliance

    The NIH’s first $666,442 installment of EcoHealth’s $3.7 million grant was paid in June 2014, with similar annual payments through May 2019 under the “Understanding The Risk Of Bat Coronavirus Emergence” project.

    Notably, the WIV “had openly participated in gain-of-function research in partnership with U.S. universities and institutions” for years under the leadership of Dr. Shi ‘Batwoman’ Zhengli, according to the Washington Post‘s Josh Rogin.

    EcoHealth Alliance president Peter Daszak toasts with WIV’s ‘Batwoman’ Shi Zhengli

    So now we have a 2015 document from the Chinese military describing using COVID as a bioweapon – four years before the COVID-19 pandemic breaks out just miles away from a Chinese lab working to make bat COVID more transmissible to humans, and you’re a conspiracy theorist peddling ‘debunked lies’ if you think they might be related.

    And for those who say ‘COVID-19 couldn’t be man-made because a laboratory-created virus would have tell-tale signs of manipulation’ – au contraire. As Nicholas Wade noted three days ago in the Bulletin of the Atomic Scientists, “newer methods, called “no-see-um” or “seamless” approaches, leave no defining marks. Nor do other methods for manipulating viruses such as serial passage, the repeated transfer of viruses from one culture of cells to another. If a virus has been manipulated, whether with a seamless method or by serial passage, there is no way of knowing that this is the case. “

    It’s as if the painfully obvious answer was right in front of us, only to be shrouded in propaganda by China-friendly politicians, big tech, and news outlets running cover for what should be the easiest game of connect-the-dots on the planet. Luckily, what was taboo as recently as a year ago will soon be exposed for the world to see, thanks to The Bulletin Of Atomic Scientists which earlier this week dared to open The Wuhan Virus “Pandora’s Box“…

    Tyler Durden
    Sat, 05/08/2021 – 21:00

  • Dollar Stores Dominate US Retail Store Openings 
    Dollar Stores Dominate US Retail Store Openings 

    The wildly uneven US economic recovery since the virus pandemic began in early 2020 has given rise to dangerous levels of inequality, otherwise known as the “K-shaped” recovery. The “K” represents an immediate recovery for the rich but continued economic hardships for the working poor. Payrolls are still millions of jobs short of pre-COVID levels, and millions of others continue collecting stimulus checks. Corporate America understands this souring picture and has found a way to capitalize on an increasingly larger population of working poor Americans by opening a flurry of dollar stores across the country. 

    Coresight Research, a firm that focuses on retail & technology companies, reports about 45% of the 3,597 store openings of large chains in the US this year are from Dollar General, Dollar Tree, and Family Dollar. 

    The pandemic resulted in millions of Americans who instantly fell into poverty and will remain there as the economy is short 8 million jobs from pre-COVID levels. Many of these folks enjoy the high-life, collecting Biden stimulus checks with minimal incentive to find a job. 

    Corporate America understands the dynamics at play as failed fiscal and monetary policies could not lift all boats. Anyone who owned stocks, bonds, real estate, classic cars, fine art, wine, and anything else of value saw incredible valuation gains over the past year as those without assets (working poor) saw very little financial improvements besides a few government stimulus checks. 

    This means that millions of folks in a pre-Covid world who shopped at middle to upper-class shops can no longer afford and have migrated to low-income dollar stores for survival. Corporate America is capitalizing on this trend by expanding these stores at a very fast clip. 

    “We’ve seen a bifurcation in the economy,” said Ken Fenyo, the president and head of advisory and research at Coresight. “So while the wealthy have done well and continue to do well since the Great Recession, there’s certainly a lot of the population that has not done as well. The dollar stores appeal strongly to that segment of the population. That’s probably the overriding reason we see for the growth in the format.”

    The recent surge of new dollar stores across the country is indicative not of a robust recovery but one that is extremely uneven, benefiting a handful at the expense of the many, with deep residual scarring that may last a generation. 

    Tyler Durden
    Sat, 05/08/2021 – 20:30

  • New York Baseball Stadiums To Seat Fans in Separate Vaccinated And Unvaccinated Sections
    New York Baseball Stadiums To Seat Fans in Separate Vaccinated And Unvaccinated Sections

    By Zachary Stieber of The Epoch Times

    The Houston Astros play the New York Yankees during the third inning of a baseball game in New York on May 4, 2021

    People who have not received a COVID-19 vaccine will be seated separately from those who have in two major baseball stadiums in New York, officials announced this week. The segregation will be enforced at Fans at Citi Field and Yankee Stadium, home to Major League Baseball’s New York Mets and New York Yankees.

    “There are going to be separate sections for those who are vaccinated,” Randy Levine, president of the Yankees, told a May 5 briefing he joined with New York Gov. Andrew Cuomo.

    “As we sell tickets on an individual basis, they will go into one of those two areas, either unvaccinated or vaccinated because we will have some inventory in both types of location,” added Sandy Alderson, the president of the Mets.

    The details of how the new policy will be enforced are still being developed.

    Sections with people who are vaccinated against the CCP (Chinese Communist Party) virus, which causes COVID-19, can be full, with no capacity restrictions. But in sections with unvaccinated people, fans will need to be spaced apart six feet. All fans, regardless of their status, must wear a mask, even though the games are played outdoors.

    “For baseball reopening, May 19th. Two different categories. Not Yankees/Mets. Vaccinated/Unvaccinated,” Cuomo, a Democrat who has refused calls to resign over sexual assault allegations and his administration hiding the number of elderly New Yorkers who died from COVID-19, told the briefing.

    “I want to thank the Mets and the Yankees from the bottom of my heart. It’s a pain in the neck for them to operate this vaccinated and unvaccinated. The gentlemen who run the stadiums are here. It’s not easy to do this. Nobody’s done this before. Nobody’s done any of this before, let’s be honest,” he added.

    Cuomo insisted the new plan is legal.

    Fans stand during the playing of the national anthem before a baseball game between the New York Yankees and the Houston Astros in New York on May 4, 2021. (Frank Franklin II/AP Photo)

    Fans will be able to use the Excelsior Pass, an application, to show proof of vaccination when entering one of the stadiums, or proof of a negative COVID-19 test. The app was developed by IBM in partnership with the state. It was tested earlier this year at NBA and NHL games before being rolled out officially in March.

    The Yankees reported 10,850 fans at their stadium on Tuesday night. That’s the most they can have under current restrictions. In a bid to get more New Yorkers vaccinated, the teams are offering people who get a shot at a stadium a free ticket.

    “Basically you come to the game … you take a vaccine shot, you get a voucher, you can go to that game. If that game’s sold out, you can go tomorrow night and go to a game of your choice,” Levine said. Officials at Citi Field said approximately 2,000 people are getting vaccinated there each day.

    Also at the briefing, Dr. Howard Zucker, the state’s health commissioner, refused to comment on a report that said Cuomo’s senior aides delayed the release of an audit on nursing home deaths for months.

    “This is an ongoing investigation, so I won’t answer any questions at this point,” he said.

    Cuomo called the pressure on state officials regarding the shielding of death numbers political. The shielding is being probed by the Department of Justice. He also denied that his administration withheld the numbers because of fear the data would be used against them. One of Cuomo’s top aides, Melissa DeRosa, said as much in a conference call with state Democratic lawmakers earlier this year.

    Tyler Durden
    Sat, 05/08/2021 – 20:00

  • Ethereum Soars To Record High Above $3,800 As JPMorgan Lays Out 6 Reasons Why Explosive Move Will Continue
    Ethereum Soars To Record High Above $3,800 As JPMorgan Lays Out 6 Reasons Why Explosive Move Will Continue

    Back on April 25, we quoted a prominent billionaire VC who said that “Ethereum is the world’s most interesting trade right now” and we predicted that “Ethereum Is About To Make An Epic Breakout Over Bitcoin.“

    That’s exactly what happened: two weeks later, and one report from FundStrat’s Tom Lee putting out a $10,500 price target on Ethereum (and $100,000 on bitcoin)..

    … and ethereum has returned 66% to bitcoin’s paltry 16%, a 4x outperformance which even to the most jaded traders constitutes an “epic breakout.”

    More importantly, as bitcoin has languished in the $50-$60K range over the past month, ETH has nearly doubled and moments ago traded at an all time high above $3,800.

    Meanwhile, the ratio of ETH/BTC finally broke out above its recent highs..

    … and as we said two weeks ago “once the recent high is taken out, there is much more room to go… In fact, should ETHBTC hit its historical high, Ethereum would be above $5,000.” We are now just $1,200 away which at the current pace of ascent, may be reached some time next week.

    While there are many reasons for the renewed investor fascination in Ethereum, including the launch of four ethereum ETFs, the application by VanEck for the first US Ethereum ETF, the exploding demand for NFTs, interest in DeFi and generally the realization that while Bitcoin is just a token, Ethereum is an entire digital platform (not to mention the most obvious one: relentless upside momentum which in the case of bitcoin, appears to have tapered for now).

    It’s perhaps why two days after we said to brace for an “epic” ethereum breakout, JPMorgan published a note on April 27 from one of its most respected rates and fixed income (!) strategists, Joshua Young, explaining “why ETH is outperforming” in which it gave yet another reason for ethereum’s stunning outperformance compared to bitcoin: ETH valuations may be less dependent on levered  demand than BTC, a technical but occasionally important tailwind going forward.

    Of course, one can’t also discount the rabid frenzy to all things crypto in recent days as Elon Musk is set to appear on SNL on Saturday night and pitch the “joke” crypto, Dogecoin, whose returns have blown everything else out of the water.

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    So yes, there is a risk that after Saturday night, the crypto space and especially Doge, will be hit as some take profits, but as JPMorgan writes in a new note published late on Friday and authored by its versatile cross-asset quant Nick Panagirtzoglou whose job is to cover everything from retail interest in stocks to calculating the “fair value” of bitcoin and ethereum (yes, really), the move higher in ethereum has been far more striking than the one in bitcoin, and is likely to continue.

    As the JPM quant writes in a section discussing “ethereum’s ascent”, the crypto market expanded sharply in recent weeks led by ethereum and other smaller cryptocurrencies, despite bitcoin still hovering below $60k, with Panigirtzoglou admitting that “the rise in ethereum in particular has been striking”, which he attributes to a combination of factors:

    1. The European Investment Bank (EIB) used the ethereum blockchain to issue €100mn in two-year zero-coupon digital notes last week, its first ever digital bond. The transaction involved a series of bond tokens on the ethereum blockchain, where investors purchase and pay for the security tokens using traditional fiat. The EIB digital bond is surely very significant as it represents the endorsement of the ethereum blockchain by a major official institution.
    2. The first ethereum ETF (ETHH) was launched on April 20th by Purpose Investments in Canada and three more ethereum ETFs launches followed during the same month.
    3. The structural decline in ethereum supply from the pending introduction of protocol EIP1559 in the summer. EIP 1559‘s objective is to make transaction fees on the ethereum blockchain more predictable by introducing an automatically calculated base fee for all transactions depending on network activity. Once paid with ethereum, this fee would be immediately burned, implying reduced supply of ethereum in the future. Ethereum’s theoretically unlimited supply had been a concern in the past, with ethereum in circulation rising by 5% per year over the past three years. Via burning ethereum through base fees, EIP1559 could potentially reduce the annual change of ethereum in circulation to 1-2% per year.
    4. The greater focus by investors on ESG has shifted attention away from the energy intensive bitcoin blockchain to the ethereum blockchain, which in anticipation of Ethereum 2.0 is expected to become a lot more energy efficient by the end of 2022. Ethereum 2.0 involves a shift from an energy intensive Proof-of-Work validation mechanism to a much less intensive Proof-of-Stake validation mechanism. As a result, less computational power and energy consumption would be needed to maintain the ethereum network.
    5. The sharp growth of NFTs and stablecoins in recent months are increasing the usage of the ethereum which is already dominating the DeFi ecosystem.
    6. The rise in bond yields and the eventual normalization of monetary policy is putting downward pressure on bitcoin as a form of digital gold, the same way higher real yields have been putting downward pressure on traditional gold. With ethereum deriving its value from its applications, ranging from DeFi to gaming to NFTs and stablecoins, it appears less susceptible than bitcoin to higher real yields.

    Indeed, JPM concedes that both retail and institutional demand indicators accelerated in recent weeks and months, while JPM’s position proxy based on CME ethereum futures, shown in Figure 6 more than tripled during April pointing to significant, around $250mn, of institutional buying in Etherem.

    The flow trajectory for ethereum funds got boosted in April from the launch of four ETFs, pointing to a mix of institutional and retail impulse (Figure 7 and Figure 8).

    These flow metrics look even more impressive if one compares them to the equivalent for bitcoin as shown in Figure 9 and Figure 10.

    The surge in interest is translating into rapidly accelerating activity on the ethereum network, similarly implying rising demand.

    And while we were quite surprise by the JPM’s bullish take on ethereum at least as compared with its persistent bearishness on bitcoin, it is not surprising that the bank’s quant concluded his report with a warning, noting that “the past weeks have not only seen a large expansion of the market cap of ethereum but also of other coins such as Binance Coin, Dogecoin, Litecoin, Ethereum Classic, and others. This expansion has shifted the market cap of cryptocurrencies excluding Bitcoin and Ethereum and as well as stablecoins to a staggering $800bn with the share of bitcoin in the total crypto market falling steeply from around 60% to 45% over the past month.”

    Of course, the JPM strategist has to admit that a big part of this decline has been helped by increased institutional interest in ethereum (the same ethereum whose “striking” move higher he believes will continue). But to the extent it is driven by a rally in other cryptocurrencies driven more by retail demand, Panigirtzoglou writes that “it carries some echoes of the froth that was evident in December 2017 when the share of bitcoin had fallen from around 55% to below 35%.”

    Of course, those who actually traded through the crash of 2018 know that it had little to do with retail participation and everything to do with the Fed’s ongoing tightening, with the Fed hiking rates three times in 2017 and then another 4 in 2018. So while there may be similarities, there is one giant difference, namely that for now the Fed has little intention to taper QE let alone hike rates. In fact, if one goes according to comparisons to the Fed’s last rate hike cycle, ethereum, bitcoin, and other cryptos, will peak some time in late 2024, one year after the Fed will have started its latest (failed) tightening cycle. The only question is how many tens (or hundreds) of thousands of dollars one ethereum token will cost then.

    Tyler Durden
    Sat, 05/08/2021 – 19:35

  • US Troops Accused Of Pillaging Syrian Grain Silos As Russia Warns Of Increased Occupation
    US Troops Accused Of Pillaging Syrian Grain Silos As Russia Warns Of Increased Occupation

    Syrian and Russian state sources are reporting late this week that Russia’s Defense Ministry is expressing anger over what it described as noticeably increased American military activity in Syria’s northeast region, particularly an uptick in military equipment and troop deployments to the al-Jazeera area.

    The Russian Coordination Center in Hmeimim cited the increased air and land transport of American military hardware as part of the continuing violation of Syria’s sovereignty intended to block the Syrian population from its own vital resources, including wheat and energy.

    The Russian statement said “such military mobilization, synchronized with the economic and social situation resulting from the US blockade damages opportunities for a political solution to the crisis in Syria.”

    The most recent estimates of US troop numbers in the country put the Pentagon’s presence at around 1,000 troops – with many of these being special forces. In prior years it was believed to be anywhere from 2,000 to 3,000 – but these estimates have long likely shielded the true numbers of US personnel, including US intelligence and security contractors. 

    Days ago Damascus accused US troops of pillaging grain silos in an occupied area of the Hasaka countryside. 

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    “US occupation forces brought out a new batch of Syrian wheat stolen from Tal Alou silos in Hasaka countryside to the north of Iraq,” state-run SANA reported Wednesday.

    “Local sources in al-Sweidia village in al-Ya’arubia area told SANA reporter that a convoy of 35 trucks laden with wheat stolen from Tal Alou silos left under a protection of an armed group affiliated to US occupation –backed QSD militia through al-Waleed illegitimate crossing heading for north Iraq,” the report said.

    Tyler Durden
    Sat, 05/08/2021 – 19:30

  • The Dynamics Behind America's Ugly Amount Of Empty Office Space
    The Dynamics Behind America’s Ugly Amount Of Empty Office Space

    Authored by Wolf Richter via WolfStreet.com,

    This sort of sudden structural collapse in demand for office space raises some existential questions for landlords…

    Companies are not massively defaulting on their office leases, and that’s the good thing. But they have put a historic amount of vacant office space on the sublease market, while continuing to pay rent to the landlord. They decided they no longer need that much space, now that some form of flexible work, or hybrid work-from-home, or even permanent work-from-anywhere is being integrated into office real estate plans, cost cutting efforts, and footprint-reduction strategies.

    Now, 14 months into the Pandemic, office occupancy – workers actually showing up at the office – is still dreadfully low. As of the end of April, office occupancy in the 10 largest metros averaged only 26.5% of where it had been just before the Pandemic, according to Kastle Systems today, whose electronic access systems secure thousands of office buildings around the country. In other words, the number of people entering these offices was still down by 73.5% from pre-pandemic levels and has barely made headway in recent months:

    The epicenters of work-from-home show the biggest drops in office occupancy rates, according to Kastle’s “Back to Work Barometer” at the end of April: in San Francisco, the occupancy rate was at 14.8% of the pre-Pandemic level, in New York City at 16.2%, and in San Jose at 18.0%.

    Among tech companies, 95% expect remote work for at least a few days a week; 9% said that they will never return to the office at all; another 47% said that they will need less office space; only 13% said they would need more office space, according to a survey by Savills.

    A survey of Californian residents found that 82% of the employees who now work at home want to continue working at home at least some of the time. Only 18% don’t want to work at home at all.

    But even at the top end of office occupancy, working remotely is still king. In Dallas, office occupancy is at 41.2% of where it was pre-Pandemic, and in Austin at 40.2% (click on the chart to enlarge):

    How exactly this will shake out for office real estate is getting complicated, as they say, with everyone involved having different ideas as to what they want.

    A survey by Accenture of 400 North American financial-services companies found that 80% of the executives would like for workers to spend four or five days in the office post-Pandemic. Many of them think that working at home makes training younger employees more difficult and is hurting company culture.

    But employees are looking for flexibility, now that they have proven that they can be productive at home.

    “You’ve seen the senior executives sitting in their office and there’s nobody behind them,” Laurie McGraw, head of Accenture’s capital markets industry team in North America, told Bloomberg. “And then you see the entry-level folks starved for in-person interaction because they need to be coached on a more regular basis. And then there’s the vast middle that’s content to be home.”

    The work-from-home year 2020 generated record profits for banks, proving that work-from-home can be managed, and many employees question the need to commute every day. According to Rob Dicks, Accenture’s talent and organization head for capital markets, employees are likely to push back against a full-time return.

    Despite whatever executives would like, the reality of the cost-cutting aspects of working from home has already set in. According to Accenture’s survey, of the same executives:

    • Nearly two-thirds expect to cut their office footprint by 11% to 40% over the next nine months.

    • Over half are planning to relocate employees to new lower-cost locations.

    • 9% said they’ll close their headquarters in a major market.

    Financial firms have been all over the place with their plans.

    Goldman Sachs, in an internal memo seen by Bloomberg, told its US employees that they should be prepared to report to the office by June 14, according to an internal memo seen by Bloomberg.

    Vanguard Group, which employs about 17,300 people, is planning a hybrid model for most of its staff, with many employees able to work from home on Mondays and Fridays.

    Bridgewater Associates is going for the hybrid model as well and will allow their employees to work from home at least part of the time.

    Deutsche Bank, which employs about 8,000 people in the US, is planning to let its staff work from home for up to three days a week. Separately, the bank had said that it wanted to reduce its office foot print to cut costs.

    Deutsche Bank is offering “flexibility” as an inducement for hiring and retention. A survey had found that 90% of its employees wanted the opportunity to work from home at least part of the time after the Pandemic. Office space will be reconfigured to accommodate the hybrid model.

    JPMorgan Chase told its employees in a memo to report back to the office by early July on a “consistent rotational schedule” that would allow staff some flexibility.

    For landlords, these are existential questions as an enormous amount of office space is now vacant and available for lease in the US, and more office towers are in the process of being built, and nothing could have prepared the commercial real estate industry for this sort of sudden structural collapse in demand.

    *  *  *

    Enjoy reading WOLF STREET and want to support it? Using ad blockers – I totally get why – but want to support the site? You can donate. I appreciate it immensely. 

    Tyler Durden
    Sat, 05/08/2021 – 19:00

  • "Will Of The Country": Huge Victory For Scottish Nationalists Sets Up Next Independence Clash With UK
    “Will Of The Country”: Huge Victory For Scottish Nationalists Sets Up Next Independence Clash With UK

    The last hugely controversial Scottish referendum on independence took place in September 2014 and showed that the Scottish population’s desire to leave its three-centuries old union with England and Wales was gaining momentum. At that time it was approaching half – with the 2014 result being 55% voting to remain with 45% in favor of independence.

    It’s now widely believed that if the UK allowed another vote today, that margin would be much narrower, and it looks like that showdown will now come sooner than thought after Saturday’s decisive election victory by First Minister Nicola Sturgeon’s Scottish National Party (SNP). Sturgeon’s first declaration was aimed squarely at London and Boris Johnson, as she called another independence referendum the “will of the country”.

    Nicola Sturgeon, via The Herald

    Her SNP won an unprecedented 64 seats in the Scottish Parliament, which falls just one seat short of a majority, marking a slight increase even over 2016, which ensures a legal and constitutional battle for the future of the United Kingdom will be sparked once again.

    Given that the pro-independence Scottish Greens also made huge gains in what’s widely considered their best performance ever, the result is a firm pro-independence majority.

    Sturgeon quickly put London on notice…

    An independence referendum was pledged in the manifesto of both the SNP and the Scottish Greens, and Ms Sturgeon declared: “It is a commitment made to the people by a majority of the MSPs have been elected to our national parliament.”

    “It is the will of the country.”

    “Given that outcome, there is simply no democratic justification whatsoever for Boris Johnson or anyone else seeking to block the right of the people of Scotland to choose our future.”

    If the request is rejected, Ms Sturgeon said, “it will demonstrate conclusively that the UK is not a partnership of equals and that – astonishingly – Westminster no longer sees the UK as a voluntary union of nations”.

    She added: “That in itself would be a very powerful argument for independence.”

    Sturgeon further explained the vote result is a clear and urgent mandate for Scotland to push ahead with preparing for a second independence referendum to be held as soon as the COVID-19 pandemic is over. 

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    Rabobank noted the significance of this weekend as follows:

    The Scottish regional election on May 6 is potentially shaping up to have a big impact on the future of Scotland and the UK, as independence has returned to the top of the agenda. The Scottish National Party looks set to win by a considerable margin, and is then likely to claim to have gained a new mandate for a referendum. The Conservative Party, officially the Conservative and Unionist Party, will in turn continue to make the case for the union. But even when prime minister Johnson denies Scotland a second independence referendum, or employs more heavy-handed tactics to suppress ‘Scoxit’ sentiments, the rift between Scotland and England looks set to widen. The Scottish regional election should be viewed entirely through this prism.

    In the meantime Sturgeon told her supporters that it’s time to “patiently persuade our fellow citizens” of the case for an independent Scotland.

    Tyler Durden
    Sat, 05/08/2021 – 18:30

  • "This Was a Massacre": Brazilian Police Kill Two Dozen In Deadliest Favela Raid In Rio's History
    “This Was a Massacre”: Brazilian Police Kill Two Dozen In Deadliest Favela Raid In Rio’s History

    Authored by Jake Johnson via CommonDreams.org,

    More than 100 heavily armed Brazilian police officers stormed a sprawling Rio de Janeiro favela (a shanty town or slum) Thursday and killed at least two dozen people, a raid that human rights activists, researchers, and journalists described as the deadliest such police atrocity in the city’s history.

    The hours-long operation, purportedly aimed at drug traffickers in the poverty-stricken Jacarezinho favela, ultimately left at least 25 people dead, including one police officer. Horrific video footage and images posted to social media in the wake of the raid—which was carried out despite a court order against such incursions during the Covid-19 pandemic—show favela residents surveying rooms, hallways, and alleys streaked with blood. “It’s extermination—there’s no other way to describe it,” Pedro Paulo Santos Silva, a researcher at Rio’s Center for Studies on Public Security and Citizenship, told The Guardian. “This was a massacre.”

    Via The Guardian

    “Really grim moment in Brazil,” Robert Muggah, co-founder of the Igarapé Institute, a Rio-based think tank, said in an interview with the Washington Post. “These shootings are obviously routine in Rio de Janeiro, but this is unprecedented, in that it’s the operation that has generated the largest number of deaths, ever.”

    Brazilian lawmaker David Miranda, who grew up in Jacarezinho, called the deadly police raid “a tragedy, a slaughter authorized by Cláudio Castro,” Rio’s governor. “Jacarezinho is my origin, it is the favela that created me,” said Miranda. “No person born outside the favela can know what that is. Brazilian institutions insist on disrespecting and marginalizing the favela.”

    Journalist Glenn Greenwald, Miranda’s husband, wrote on Twitter that he has “seen probably two dozen videos that are way too horrifying to publish: police enter homes with full force and violence, and then execute people as they lay on the ground, shooting them 10-15 times each in the head.”

    “It’s an atrocity what happened today,” Greenwald added.

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    Brazil suffers one of the highest rates of police killings in the world, and the nation is currently led by a far-right president who campaigned on the promise to “give the police carte blanche to kill.” According to Human Rights Watch, Rio law enforcement officers killed 453 people during the first three months of 2021.

    “They say there is no death sentence in Brazil. Except if you live in a favela,” said Marilia Corrêa, a Latin America historian and postdoctoral fellow at the University of Michigan’s Weiser Center for Emerging Democracies. “In this case, the police can just march in, kill dozens of people, and call it a day. This is appalling, revolting, outrageous. They have no right.”

    (Warning: the following footage is disturbing)

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    Jurema Werneck, executive director of Amnesty International Brazil, said in a statement Thursday that “the number of people killed in this police operation is reprehensible, as is the fact that, once again, this massacre took place in a favela.”

    “It’s completely unacceptable that security forces keep committing grave human rights violations such as those that occurred in Jacarezinho today against residents of the favelas, who are mostly Black and live in poverty,” said Werneck. “Even if the victims were suspected of criminal association, which has not been proven, summary executions of this kind are entirely unjustifiable.”

    Tyler Durden
    Sat, 05/08/2021 – 18:00

  • Hedge Funds Are The 'Most Short' Junk Debt Since Lehman
    Hedge Funds Are The ‘Most Short’ Junk Debt Since Lehman

    A month ago we warned that The Fed’s incessant intervention had put distressed investors out of business as the remarkable rally in even the lowest quality junk debt (‘CCC or triple hooks’) had created party time for zombie companies everywhere as “high yield” is now officially “low yield.”

    And, while the party can and will go on as long as there are greater fools, one look at the fundamentals…

    … confirms that the party will only last as long as central banks keep injecting hundreds of billions into the market each and every month.

    “People aren’t investing, they’re just chasing.”

    That is the ominous, ponzi-like warning from Adam Cohen, Caspian Capital’s managing partner as the distressed debt investor has chosen to return some money to investors because the rewards don’t justify the high risks anymore.

    He’s right. Despite soaring debt levels and forward economic uncertainty, US HY debt risk spreads are 100bps tighter than pre-COVID levels…

    And all that has sparked a resurgence in hedge funds betting against this farce continuing.

    In fact, as Bloomberg reports, global high-yield bonds worth as much as $55 billion are on loan to traders seeking to profit if prices drop, according to data from IHS Markit.

    That is the largest balance since the fall of 2008, and compares with about $35 billion at the start of the year.

    “I would expect that to get bigger as spreads tighten and/or people get worried about rates rising,” said Tim Winstone, a portfolio manager at Janus Henderson, which oversees 294 billion pounds ($409 billion).

    “At these levels of valuations, I’m not surprised more people, such as hedge funds, are setting shorts.”

    And we are starting to see the impact of this drop in bullish/momo-chasing malarkey in the performance of deals in the secondary market. Almost one out of four high-yield bonds sold this year is indicated below the price it was issued at, based on data compiled by Bloomberg.

    With The ECB already hinting at scaling back its asset-purchases, and BoE having already done so, The Fed continues to ignore talk of its own tapering, but between HY shorts, and deleveraging, investors are starting to signal the build-up of defenses against a potential scaling back of central-bank support.

    Tyler Durden
    Sat, 05/08/2021 – 17:39

  • Bill Gates-Funded Company Releases Genetically Modified Mosquitoes In US
    Bill Gates-Funded Company Releases Genetically Modified Mosquitoes In US

    Submitted by Epoch Times

    Genetically modified mosquitoes have been released for the first time in the United States as part of an experiment to combat insect-borne diseases such as Dengue fever, yellow fever, and the Zika virus.

    UK-based biotechnology firm Oxitec, which is funded by the Bill and Melinda Gates Foundation, said it released the mosquitoes in six locations in Monroe County’s Florida Keys: two on Cudjoe Key, one on Ramrod Key, and three on Vaca Key. It’s part of an effort to help tackle a disease-transmitting invasive mosquito population—the Aedes aegypti mosquito species—that’s responsible for “virtually all mosquito-borne diseases transmitted to humans,” according to the company.

    These mosquitoes make up about 4 percent of the mosquito population in the Keys, and transmit dengue, Zika, yellow fever, and other human diseases, as well as heartworm and other potentially deadly diseases to pets and other animals.

    The experiment is in collaboration with the Florida Keys Mosquito Control District (FKMCD), and was approved by the U.S. Environmental Protection Agency (EPA), the Florida Department of Agriculture and Consumer Services (FDACS), the U.S. Centers for Disease Control and Prevention, and an independent advisory board.

    Over the next 12 weeks, fewer than 12,000 mosquitoes are expected to emerge each week, for approximately 12 weeks. Untreated comparison sites will be monitored with mosquito traps on Key Colony Beach, Little Torch Key, and Summerland Key. If successful, some 20 million additional genetically modified mosquitoes will be released later in the year.

    “We really started looking at this about a decade ago, because we were in the middle of a dengue fever outbreak here in the Florida Keys,” FKMCD Executive Director Andrea Leal said during a video news conference. “So we’re just very excited to move forward with this partnership, working both with Oxitec and members of the community.”

    The insects released by the biotechnology firm are all male, so they don’t bite. They’re expected to mate with the local biting female mosquitoes, and in doing so, they will pass on a lethal gene that will ensure their female offspring die before reaching maturity.

    According to Quartz, areas including Malaysia, Brazil, the Cayman Islands, and Panama, where similar experiments have been carried out, have seen mosquito populations drop by as much as 90 percent.

    The project has faced backlash from residents, who say their consent was not sought for the experiment.

    Tyler Durden
    Sat, 05/08/2021 – 17:14

  • Credit Suisse Hires Former Prime Brokerage Head To Restore Business After Archegos Blowup
    Credit Suisse Hires Former Prime Brokerage Head To Restore Business After Archegos Blowup

    After firing a raft of senior employees including its head of risk, Lara Warner, Credit Suisse has been struggling to move past a series of major risk-management failures that together could cost the bank $10 billion, or more, though the final tally of losses from the Archegos blowup isn’t yet known as the bank weighs whether it should cover some client losses associated with the “low risk” trade-finance funds that collapsed earlier this year.

    Following reports that the bank took in only $17.5MM in fees from servicing the trade that led to the collapse of highly-levered Archegos Capital, the hedge fund that used highly leveraged $20 billion to more than $100 billion via a string of bets with various prime brokers to amplify its bets on ViacomCBS and a host of other tech and media stocks (many Chinese ADRs) while skirting reporting requirements, it has become apparent the bank’s leadership in that division is sorely lacking (both of the co-heads of the division were both sacked in the aftermath of the Archegos implosion).

    So, Bloomberg reports that, in order to reorganize and “clean up” the bank’s prime brokerage business, it’s bringing back a familiar face: Indrajit Bardhan, a former head of the unit who left the bank three years ago in what BBG described as a “leadership shakeup”. Bardhan will return as a consultant to offer the bank some guidance as it seeks to reconstitute the potentially lucrative (but risky) business of serving hedge funds and family offices.

    The Swiss bank hired Bardhan as a consultant, according to people with knowledge of the arrangement, who asked not to be identified because the matter is private. He was among a number of high-profile executives to exit in 2018. He relinquished his role as global head of prime services to Paul Galietto, who later rose to head of equities and then left last month after the bank posted $5.5 billion in losses tied to Archegos.

    As BBG points out, the unusual decision to enlist a veteran of the bank (and one who apparently ran afoul of the leadership under former CEO Tidjane Thiam) reflects the desperate position Switzerland’s second-largest lender has found itself in. Bardhan was among a number of high-profile executives to exit in 2018. He relinquished his role as global head of prime services to Paul Galietto, who later rose to head of equities before being canned last month.

    The unusual decision to enlist a veteran underscores the challenge the Zurich-based bank faces in rebuilding the potentially lucrative but risky business of catering to hedge funds and other sophisticated investors. It pared a number of experienced staffers years ago. And more recently the firm saw another raft of senior departures after the Archegos debacle, including the co-heads of the prime brokerage unit.

    So far, Archegos alone has wiped out one year of profit for Credit Suisse, and with the Archegos situation not yet fully resolved, investors have started to question everything, from CEO Thomas Gottstein’s ability to manage the bank, to the board’s ability to supervise him. In another unusual move, the board sacked one of its own in the face of growing shareholder pressure ahead of its annual meeting.

    We can’t help but wonder: Will CS bring back Tidjane Thiam to help offer some guidance to Gottstein?

    Tyler Durden
    Sat, 05/08/2021 – 15:31

  • Why Californians Have Sky-High Electricity Bills
    Why Californians Have Sky-High Electricity Bills

    Authored by Irina Slav via OilPrice.com,

    Californians pay for some of the most expensive electricity in the United States. They also live in one of the greenest states, at least from an energy perspective. California is only going to get greener. Meanwhile, electricity bills are expected to continue their rise. Some deny there is a link between the two.

    The facts show otherwise.

    A paper by the California Public Utilities Commission released earlier this year identified the state’s plans to reduce greenhouse gas emissions by adopting more renewable energy as one big factor for bigger utility bills and expectations for further increases in electricity rates in the coming years.

    The report said that while the state’s plans to reduce emissions will negatively affect electricity bills, a concerted switch to what the authors call “all electric homes and electric vehicles” could lead to a substantial drop in monthly bills. However, this would require a large upfront investment, which would be impossible to shoulder by medium- and lower-income households.

    “In the absence of subsidies and low-cost financing options, this could create equity concerns for low- to moderate-income households and exacerbate existing disparities in electricity affordability,” the report said.

    But funding such a hypothetical move to “all electric homes and electric vehicles” is only part of the problem. Another part, ironically, is distributed energy systems.

    A March report in CalMatters summarized the reasons for Californians’ high electricity bills as follows: first, the size and geography of the state make the fixed costs associated with the maintenance of its grid higher than in most other states; second, households with rooftop solar installations don’t pay for these fixed costs even if they use the grid. And all this is deepening the divide between wealthy and not-so-wealthy Californians, making electricity increasingly less affordable for the latter.

    Distributed solar installations appear to be only affordable for the wealthier citizens of the state. They can afford the upfront costs and then benefit from lower electricity bills, according to one of the authors of a UC Berkeley’s Haas Business School study that CalMatters cited in its report.

    Solar power is regularly touted as cheaper and cheaper, even exceeding the affordability of fossil fuels. The truth, however, is that the cost declines that have been celebrated by renewable power lobbies only concern the PV panels. Granted, any cost decline in solar is good news, but what most reports forget to mention is that it’s not just panels that make solar farms or even rooftop installations.

    Besides panels, solar power installations also involve other components—whose costs are not falling—and there is the cost of installation. Taken together, all these make up a rather hefty sum, which explains why it is wealthy Californians who are the ones taking advantage of the state’s programs aimed at encouraging the adoption of low-carbon energy sources. They are also the ones reaping the benefits at the expense of poorer Californians.

    California has something called a net energy metering (NEM) program that basically pays owners of solar installations for feeding electricity into the grid. An analysis of the system between 2017 and 2019, Utility Dive reported recently, shows that the costs of the program stood at $9.46 billion while the benefits stood at $7.96 billion. Another study of the program, focusing on customer bills, found that the benefits of the program came in at $7.58 billion while costs were as high as $20.58 billion and much of that was shouldered by the people who couldn’t afford to buy a rooftop solar installation.

    And yet, California is forging ahead with its electrification plans as the only presumably viable way of reducing emissions. Meanwhile, the state’s utilities are preparing for another hot summer with possible blackouts on the menu. According to the new chief operating officer of CAISO, California will see additional generation—and crucially storage—capacity come online this year, but supply will remain tight because of the retirement of gas-fired plants and one nuclear power plant.

    These retired facilities are being replaced with renewables, much of it solar. Last summer, solar was one of the culprits behind California’s blackouts as the output of solar farms declines exactly when demand for electricity increases, in the evening, and storage capacity was nowhere near sufficient to handle the discrepancy. This summer, as CAISO’s COO, Mark Rothleder, “we will ensure storage resource providers understand how we expect them to operate the system so that storage is available when needed to meet the challenging net peak demand in the stressed summer conditions.” 

    California’s government certainly has its emission-reduction work cut out for it. On the one hand, electricity bills are rising along with renewable power capacity and the retirement of fossil fuel power plants. On the other, grid reliability leaves a lot to be desired. Dealing with the bills will require a massive investment because the people most affected by electricity rate trends simply cannot afford to shoulder that bill, too. Dealing with grid reliability will require investment, too. It would be nothing short of a transformation of the state’s grid that will involve lots and lots of energy storage capacity. On the bright side, however, California’s emissions have fallen considerably since 2000.

    Tyler Durden
    Sat, 05/08/2021 – 15:04

  • And Now Rents Are Soaring Too
    And Now Rents Are Soaring Too

    With BofA predicting that the US is facing a period of “transitory hyperinflation” as a result of soaring commodity prices in everything from metals to food…

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    …. and beyond, in what increasingly more warn is a stagflationary burst right out of the 1970s playbook…

    … it makes sense that home prices are also surging thanks to trillions in stimmy checks, near-record low mortgage rates and an exodus away from cities, and as we noted two weeks ago that’s precisely what they are doing, with Redfin reporting an 18% jump in median home sale prices to an all time high…

    … as a record 58% of all houses sell within two weeks of listing, of which 45% sell for more than their listing price, also a record.

    Amid this dismal “transitorily hyperinflationary” landscape, where those whose incomes aren’t similarly hyperinflating find themselves at risk of being unable to afford a roof above their head, there was one ray of hope: renting, with rent prices tumbling in recent months and according to the BLS’ monthly CPI metric, rent inflation had just dropped to the lowest in a decade, just below 2.0% annually…

    … which due to the way the CPI basket is weighted acted as a key anchor on overall CPI rates, and served to distort the broader inflationary picture. In short, the Fed would look at the relatively tame core CPI which was only tame thanks to “tumbling” rents and would conclude that there is nothing to worry about.

    Only it now appears that not only was the government misrepresenting the actual data in hopes of extracting as much stimulus from the Biden regime by pretending inflation is low and “contained”, but that rents are in fact soaring once again.

    On Thursday, American Homes 4 Rent, which owns 54,000 houses, increased rents 11% on vacant properties in April, the company reported in a statement:

    … Continued to experience record demand with a Same-Home portfolio Average Occupied Days Percentage of 97.3% in the first quarter of 2021, while achieving 10.0% rental rate growth on new leases, which accelerated further in April to an Average Occupied Days Percentage in the high 97% range while achieving over 11% rental rate growth on new leases.

    Invitation Homes, the largest landlord in the industry, also boosted rents by similar amount, an executive said on a recent conference call. Or, as Bloomberg puts it, record occupancy rates are emboldening single-family landlords to hike rents aggressively, testing the limits of booming demand for suburban rentals.

    While soaring housing costs had put homeownership out of reach for most Americans, rents had been relatively tame for much of 2020. But in recent months, rents have also soared as vaccines fuel optimism about a rebound from the pandemic, and a reversal in the city-to-suburbs exodus.  The increases, as Bloomberg so eloquently puts it, “may add to concerns about inflation pressures.” Mmmk.

    “Companies are trying to figure out how hard they can push before they start losing people,” said Jeffrey Langbaum, an analyst at Bloomberg Intelligence. “And they seem to be of the opinion they can push as far as they want.”

    Why the change? Well, in the early months of the pandemic, the big single-family rental companies slowed rent hikes amid an exodus of renters fleeing the big cities as a result of militant BLM protests and covid, preferring to maximize occupancy during an uncertain time for the economy. But now, widespread vacancies are giving them pricing power.

    What is remarkable is that this price hike is likely to stick: Invitation Homes reported an occupancy rate of more than 98% during the first quarter, freeing the company to raise prices by more than 10% on vacant houses in April. Invitation Homes is targeting increases of as much as 8% for tenants seeking to renew leases in coming months, an executive said on a recent conference call.

    Single-family landlords have had the upper hand over apartment owners in the age of remote work, but those advantages might dissipate as employers summon workers back to the office.

    “How much of the demand is temporary?” said Langbaum. “I do believe some component of it will revert back to urban markets.”

    So as rent rebound with a vengeance, and the CPI basket’s all important Shelter and Rent inflation series (which also serves as a bseline for the Owner Equivalent Rent series) jerks higher, how much longer can the Fed pretend that the vastly overheating US economy is not in a “transitory hyperinflation“, or at least on the verge of stagflation.

    Tyler Durden
    Sat, 05/08/2021 – 14:18

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