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Aujourd’hui — 28 février 2021Zero Hedge

Propaganda Crash: World Economic Forum Tweets "Lockdowns Improving Cities", Then Deletes Admitting It Was Wrong

Par Tyler Durden
Propaganda Crash: World Economic Forum Tweets "Lockdowns Improving Cities", Then Deletes Admitting It Was Wrong

If there was any doubt that economic lockdowns supposedly inspired by the Covid pandemic are the peak in globalist propaganda, it disappeared not so "quietly" once and for all at 5:48am ET on Saturday, when the organization of peak globalism which recently unleashed such lunatics as Klaus Schwab, best known for revealing the endgame to the world with his book COVID-19: The Great Reset, deleted a that Lockdowns are "quietly improving cities around the world."

Remarkably, the WEF’s propaganda tweet - which was was accompanied by a video showing deserted streets and silent factories, that noted a record drop in carbon emissions and also linked to an article claiming that silent cities contributed to better detection of minor earthquakes (because millions of workers losing their jobs is clearly less important than being able to measure the next quake to the 8th significant digit) -survived just a few hours following a barrage of mockery and outraged comments.

We’re deleting this tweet. Lockdowns aren’t “quietly improving cities” around the world. But they are an important part of the public health response to COVID-19.

— World Economic Forum (@wef) February 27, 2021

Then, just a few hours later on Saturday morning, the WEF finally deleted the tweet, admitting in a subsequent highly ratioed tweet that "lockdowns aren’t “quietly improving cities” around the world" depite still insisting that the restrictions have been “an important part of the public health response to Covid-19.”

By this point, however, social media was in full blown attack mode and the WEF's admission that covid lockdowns are just peak propaganda  - one which has the complicit participation of all Sillicon Valley tech giants sparked en even louder response from an outraged non-Davos audience.

Too late. You already said locking us in our homes has improved the world, not the most casual of statements is it? Bit hard to forget you said that.

— Kirstin (@KirstinMarianna) February 27, 2021

A group quickly accused the correction tweet as well, claiming correctly that the actual effect of lockdowns on halting the spread of the coronavirus remains a highly debated issue.

Now that’s 2 tweets you should delete. Lockdowns are inhuman and cause massive collateral damage to lives and livelihoods far beyond any “good” they do. They are straight from the CCP playbook.

— cynicalcactus (@cynicalcactus1) February 27, 2021

The concession message looked like the WEF was actually “doubling down on [its] idiocy” instead of trying to do some damage control, former British MEP Martin Daubney wrote

“We’re deleting this tweet, but doubling down on our idiocy in the process”

WTF @wef?!

— Martin Daubney (@MartinDaubney) February 27, 2021

At the same time, the peasants demonstrated remarkable insight accusing the WEF of being "the hidden enemy of the people, worldwide. The unelected force that look to dominate our lives by influencing Governments all over the globe. It needs shutting down."

The WEF, the hidden enemy of the people, worldwide. The unelected force that look to dominate our lives by influencing Governments all over the globe. It needs shutting down.

— Dragonslayer🏴󠁧󠁢󠁷󠁬󠁳󠁿❤️🏖 (@Dragons68317191) February 27, 2021

Some were furious that the propaganda arm of globalists had a "RIGHT TO RULE and DECIDE WHAT IS FAIR, EQUITABLE and REASONABLE" and warned that the crowd was coming for the WEF:

you guys are so clueless that you post something like this & then try to cancel it BUT YOU HAVE THE HIDE TO THINK YOU ARE BETTER THAN EVERYONE ELSE AND HAVE A RIGHT TO RULE and DECIDE WHAT IS FAIR, EQUITABLE and REASONABLE - a lot of you will be being prosecuted in the future imo

— (@mcm_ct) February 27, 2021

Others quickly saw through the propaganda flip-flopping, and straight to the heart of the WEF's agenda, one of spreading "global socialism" which will make lives for billions of people a nightmare which making a handful of virtue signaling uber-globalists (who arrive in Davos on their private jets even as they parade with how green they are) richer than ever:

The World Vegetable Centre?

Must have contracted their social media input to them.

Bernardi seems to know his onions tho’

— Jatroa 🏴󠁧󠁢󠁷󠁬󠁳󠁿 (@jatroa) February 27, 2021

Yet others had even more direct suggestions for the WEF:

Delete your account. And cancel your conference. The earth is not our prison and you are not our wardens.

— Nick Szabo (@NickSzabo4) February 27, 2021

At the end, the catastrophic gaffe left a huge dent on what little was left of the the globalist group's reputation, and many users argued that it should just shut up:

Yes, @wef, but the damage is done now. Very many of us have seen, very clearly, just how twisted, controlling and downright evil your intentions are, and will resist them any way we can. We may be unable to stop you, but we can be a massive bloody nuisance every step of the way.

— Erictheowl (@Erictheowl1) February 27, 2021

But most importantly, the tweet confirmed once again that what until now was a "conspiracy theory" pursued with rabid fervor by such tech giants as Google, Amazon and Twitter, was fact:

You’ve proven the conspiracy theorists correct in how mad you are

— Big Dave (@mallondavid1) February 27, 2021

It's gone beyond conspiracy theory. It's a fact.

— Andy M. Lloyd (@AJML38) February 27, 2021

Hours later, as the WEF's catastrophic fiasco spread virally across the world, the WEF decided to triple down on its peak idiocy, and instead of just forgetting all about the matter decided that it's best to engage with random twitter economists, and blame it all on "a working human being who made a mistake."

It was written by a working human being who made a mistake. It was deleted.

— World Economic Forum (@wef) February 27, 2021
Tyler Durden Sat, 02/27/2021 - 18:16
  • 28 février 2021 à 00:16

These Are The 4 Things That Can Stop The Panic In The Bond Market

Par Tyler Durden
These Are The 4 Things That Can Stop The Panic In The Bond Market

It was just last Tuesday when he presented our readers with the latest observations from JPM quant Nicholas Panaigrtzoglou, who warned that the rapid rise in bond-equity correlations...

... was bringing memories of previous violent bond tantrum episodes, including Bernanke's famous Taper Tantrum from May-June 2013, the Bill Gross-inspired Bund tantrum of May-June 2015, the period into the US election Oct-Nov 2016, Feb 2018 and Q4 2018. All of those ended with pain for both bond and equity longs, and certainly risk parity and 60/40 balanced funds who were crushed on both long legs.

Well, just two days later this warning was realized as we saw a surge in bond volatility as global bond prices plunged and yields soared as the latest inflation scare finally came to the fore (catalyzed by the catastrophic 7Y auction which sparked massive liquidation volumes across the curve).

And, as Panigrtzoglou writes today, the surge in the bond-equity correlation together with the increase in volatility is putting even more pressure on multi-asset investors, such as risk parity funds and balanced mutual funds to de-risk (something we also discussed last Thursday in "Vol, Correlation Massacre Means Capitulation Is Just Starting").

And though we now know what catalyzed last week's furious liquidation in rates, the question everyone is asking is whether the puke is over. And while some, such as the Nomura quant who correctly called both the early CTA liquidation and shorting that sparked last week's rout now believe that the worst is over and CTAs are are now covering their shorts, Friday's action which saw stocks closely sharply at their lows suggests that few are convinced.

Which brings us to the key question posed by JPM's Panigirtzoglou, namely "what conditions are needed for the current episode to subside and for equity and risk markets to resume their uptrend?"

He then proceeds to answer his  own question, the lesson from the previous positive bond-equity correlation episodes of May-June 2013, the Bund tantrum of May-June 2015, the period into the US election Oct-Nov 2016, Feb 2018 and Q4 2018, is that there are two main conditions:

  1. Rate vol needs to decline from its current very high level
  2. Bond yields need to subside and unwind a decent portion of most recent increases, in particular at the 5yr UST tenor.

Neither of these should come as a surprise to our readers. After all just last Sunday we laid out the week's events clearly, when we proposed the opposite question, i.e., "Are Yields About To Blast-Off: Here Are The 3 Things To Watch", concluding that "the aptly named MOVE index is the best real-time measure of potential runaway yields." And sure enough, just days later the MOVE exploded to the highest level since last March's bond crash.

So now that what the two critical conditions that must be present for a return to normalcy, the next question is "how could these conditions be achieved." Here JPM envisages four scenarios.

A) The Fed intervenes by raising its bond buying pace in a similar fashion to March 2020. At the time, the Fed justified its intervention by seeking to restore functioning in rate markets. Thus far at least, this argument does not yet appear justified at the current level of market stress according to JPM, although as we noted earlier, BofA is already convinced that the Fed may address nervous markets as soon as this week.

Here JPM notes that while its market depth metrics for 10y UST futures and cash bonds have deteriorated, they still appear well above levels during March 2020 and this is true for both the 5y and 10yr tenor. And, as JPM claims, without further deterioration in UST liquidity it would be difficult to envisage a Fed intervention a la March 2020, especially if one views the recent bond selloff as a function of investors embracing the reflation trade. At the same time, Fed Chair Powell and Governor Brainard are scheduled to speak next week, and it will be important to watch for signs of how it views the bond market correction.

B) CTAs and other momentum traders hit oversold levels as mean reversion signals kick in. This, JPM writes, would provide at least some temporary relief (and it sure would especially if Nomura is right that the CTA shorting has now reversed). But back to JPM's own calculations, the bank asks how far are we from oversold conditions on our momentum traders framework? The sell-off in 10y USTs to close just above 1.5% on Feb 25th has seen the bank's shorter-term momentum signal for 10y USTs reach extreme bearish territory at -1.7 standard deviations, below even its early 2018 low of -1.5 standard deviations. The average of the shorter and longer-term signals reached a level of -0.8, still some way from its early 2018 low of - 1.2 standard deviations, but it would only take a further extension of the sell-off for 10y yields to 1.6% for this to reach its early 2018 low, while for the average of the shorter-term and longer-term signals to reach its 2018 low would take a further sell-off of just 5bp to around -0.2%.

Long story short, JPM agrees with Nomura that at 10y maturities, it appears the shorter-term signals for USTs have reached levels where mean reversion or profit taking signals by CTAs should  start kicking in, while the average of shorter-term and longer-term signals are approaching those levels. That said, while there are signs that the shorter-term signal for 10y USTs and Bunds reaching extreme levels has triggered some CTAs to reduce short duration exposure, for the signals to more decisively reach oversold conditions for CTAs could take 10y UST yields reaching 1.6% and for 5y to reach 1.0%. This means that more yield momentum chasing higher could be in store in the coming days.

C) Japanese and Euro area investors step in to buy USTs to take advantage of the large yield pickup on a currency hedge basis relative to their domestic bonds. As the chart below shows, the recent TSY sell-off has seen the attractiveness of US Treasury yields rise on a currency-hedged basis, particularly for Japanese investors, and yet the probability of this flow materializing at current levels of UST vol is low as these investors and in particular banks tend to be averse to high levels of rate volatility.

Indeed, the latest weekly data on Japanese residents’ net purchases of foreign bonds for the week ending Feb 19th already saw net sales of around $18bn amid last week’s sell-off.

Before these investors step in, JPM suggests that first other flows or central bank actions are need to materialize first to induce a decline in volatility.

D) Finally, rebalancing flows by balanced mutual funds and/or pension funds would help bond markets to stabilize and bond yields to subside. Unlike foreign flows, the chance of these flows materializing is high during the current quarter according to JPM, though the timing is harder to predict and could happen. In the event it materializes more towards the end rather the beginning of March, it could create a flow vacuum for rate markets over the next two weeks. One potential risk: if and when these rebalancing flows emerge, they are unlikely to be supportive of equities, as they combine bond buying with equity selling.

* * *

Putting it all together, when thinking about the above four scenarios JPM finds that the conditions needed for this week’s market stress - which is reminiscent of the previous positive bond-equity correlation episode of Q4 2018 - to subside "may not yet be fully in place" which is a surprisingly bearish assessment, especially if as Nomura (correctly) observes, the CTA unwind of shorts has already begun and the next stop is likely to be 1.20%. Of the four scenarios, Panigirtzoglou concludes that there are some signs at least of the second starting to take shape as shorter-term momentum signals for 10y reached oversold conditions. In any event, if urgent stabilization is required and does not emerge, dragging equities lower, BofA will be right and the Fed will have to address the ongoing liquidation wave... although what the Fed will say is unclear.

After all, as we said earlier, the Fed is in a very big bind - the reason we have the current tantrum is precisely due to the massive liquidity injections from central banks who have been desperate for more inflation. Well, they have their inflation and to reverse it they plan to do what - inject even more liquidity? At some point even our broken markets will have to concede that what is going on is complete and terminal idiocy.

Tyler Durden Sat, 02/27/2021 - 18:00
  • 28 février 2021 à 00:00

Is Anyone Else Fed Up With Dr. Fauci's Forever Moving Goalposts?

Par Tyler Durden
Is Anyone Else Fed Up With Dr. Fauci's Forever Moving Goalposts?

Authored by Mike Shedlock via MishTalk,

Despite vaccines and a falling number of cases Dr. Fauci keeps moving the goalposts.

Not Yet, When?

Dr. Facuci says Vaccinated People Shouldn't Dine Indoors or Go to the Theater Quite Yet.

"There are things, even if you're vaccinated, that you're not going to be able to do in society," Fauci said on Monday during a White House COVID-19 press briefing.

"For example, indoor dining, theaters, places where people congregate. That's because of the safety of society."

Though vaccines can help prevent people from contracting severe cases of COVID-19, the jabs may not stop them from getting sick altogether. It's also still unclear whether vaccinated people can be disease carriers, meaning they might spread illness to unvaccinated people in a community where vaccination is far from universal, prolonging the pandemic.

"We hope that when the data comes in, it's going to show that the virus level is quite low and you're not transmitting it," Fauci said, cautioning:

"We don't know that now. And for that reason, we want to make sure that people continue to wear masks despite the fact that they're vaccinated."

Early signs are looking promising that vaccinated people may not spread the virus well, but it's still too soon to say for sure.

I understand wearing masks. I understand avoiding groups and parties. But enough already. 

Double masking and telling people not to eat out even after they have been vaccinated is too much to take. 

The teachers' unions will pick up on this and play it for all it's worth.


I was asked about my brief teachers' union comment above. I will explain in detail in just a bit in another post.

Meanwhile, please note Fauci falls silent following New York nursing home scandal after repeatedly praising Cuomo response.

Tyler Durden Sat, 02/27/2021 - 17:30
  • 27 février 2021 à 23:30

Judge "Disturbed" To Learn Google Tracks 'Incognito' Users, Demands Answers

Par Tyler Durden
Judge "Disturbed" To Learn Google Tracks 'Incognito' Users, Demands Answers

A US District Judge in San Jose, California says she was "disturbed" over Google's data collection practices, after learning that the company still collects and uses data from users in its Chrome browser's so-called 'incognito' mode - and has demanded an explanation "about what exactly Google does," according to Bloomberg.

In a class-action lawsuit that describes the company's private browsing claims as a "ruse" - and "seeks $5,000 in damages for each of the millions of people whose privacy has been compromised since June of 2016," US District Judge Lucy Koh said she finds it "unusual" that the company would make the "extra effort" to gather user data if it doesn't actually use the information for targeted advertising or to build user profiles.

Koh has a long history with the Alphabet Inc. subsidiary, previously forcing the Mountain View, California-based company to disclose its scanning of emails for the purposes of targeted advertising and profile building.

In this case, Google is accused of relying on pieces of its code within websites that use its analytics and advertising services to scrape users’ supposedly private browsing history and send copies of it to Google’s servers. Google makes it seem like private browsing mode gives users more control of their data, Amanda Bonn, a lawyer representing users, told Koh. In reality, “Google is saying there’s basically very little you can do to prevent us from collecting your data, and that’s what you should assume we’re doing,” Bonn said.

Andrew Schapiro, a lawyer for Google, argued the company’s privacy policy “expressly discloses” its practices. “The data collection at issue is disclosed,” he said.Another lawyer for Google, Stephen Broome, said website owners who contract with the company to use its analytics or other services are well aware of the data collection described in the suit. -Bloomberg

Koh isn't buying it - arguing that the company is effectively tricking users under the impression that their information is not being transmitted to the company.

"I want a declaration from Google on what information they’re collecting on users to the court’s website, and what that’s used for," Koh demanded.

The case is Brown v. Google, 20-cv-03664, U.S. District Court, Northern District of California (San Jose), via Bloomberg.

Tyler Durden Sat, 02/27/2021 - 17:00
  • 27 février 2021 à 23:00

Democrat Voters' Number One "Concern" Is Trump Supporters, New Poll Finds

Par Tyler Durden
Democrat Voters' Number One "Concern" Is Trump Supporters, New Poll Finds

Authored by Steve Watson via Summit News,

A poll conducted by Echelon has found that while Republican voters are concerned with issues such as illegal immigration, lack of police resources, and high taxes, Democrat voters’ top concerns are supporters of President Trump, racism, and discrimination against LGBTQ people.

While 81% of Republican voters cited immigration as the top issue, 82% of Democrats said that ‘Trump’s supporters’ is their top issue at the moment.

Of the issues we presented to ALL respondents, the economic damage from COVID-19 is the top concern in large part because it is the most bipartisan - three-quarters of GOP and Dems are very/extremely concerned.

— Kristen Soltis Anderson (@KSoltisAnderson) February 24, 2021

A further 79% and 77%, respectively cited ‘white nationalism’ and ‘systemic racism’ as the issues they are most concerned about.

This is actually pretty incredible

It also shows how effectively the Democrats/media have marginalized the Bernie Bros and other substantive leftist concerns by instead spending their time dehumanizing Trump supporters

— Will Chamberlain (@willchamberlain) February 25, 2021

Commentators immediately noted that the results highlight how the Democratic Party and the leftist media has brainwashed liberals into purely caring about identity politics over substantive issues.

It should be noted that Echelon says it created a list of “likely primary issues” for supporters of each party.

To the full sample, we did test some items that have big party gaps. But when doing a survey, you want to be mindful of "respondent fatigue" - asking people to rank 30+ issues would be A LOT. So we created a list of issues that are "likely primary issues" for each party....

— Kristen Soltis Anderson (@KSoltisAnderson) February 24, 2021

But still, when collating the full range of issues, ‘Trump’s supporters’ was a top concern for Democrats:

Looking at the full range of issues asked of each side, Republicans still say illegal immigration and lack of police support are top concerns, while for Democrats concern about spread of COVID is top of the list, with Donald Trump's supporters" in second.

— Kristen Soltis Anderson (@KSoltisAnderson) February 24, 2021

Also of note was the finding that those who identify as Trump supporters, rather then ‘party-first’ Republicans are more concerned about every issue:

When we look at the likely GOP primary issue concern broken out by whether people see themselves as "Trump supporters" or "Republican party supporters", we see Trump supporters more concerned about pretty much everything, but especially election fraud.

— Kristen Soltis Anderson (@KSoltisAnderson) February 24, 2021
Tyler Durden Sat, 02/27/2021 - 16:30
  • 27 février 2021 à 22:30

Supreme Court Slaps Down California County's Ban On Indoor Church Services

Par Tyler Durden
Supreme Court Slaps Down California County's Ban On Indoor Church Services

The US Supreme Court on Friday invalidated a California county's ban on indoor religious services, ruling that Santa Clara County must allow five churches to hold indoor services, according to Mercury News.

LIVERMORE, CA – FEBRUARY 17: Father John Pietruszka places ashes on the forehead of a parishioner during an Ash Wednesday Mass at St. Michael Catholic Church, in Livermore, Calif., on Wednesday, Feb. 17, 2021. The Mass was limited to 100 people. (Anda Chu/Bay Area News Group)

The ruling, which comes less than three weeks after the country ordered places of worship to remain shut in defiance of a previous US Supreme Court ruling allowing indoor religious services at 25% capacity, stems from a November lawsuit brought against Gov. Gavin Newsom (D), the county, and County Health Officer Sara Cody.

The new ruling by a 6-3 vote requires indoor worship services to resume at 20% capacity in the county, tossing an "erroneous decision by the US Court of Appeals for the Ninth Circuit (located in San Francisco).

"This outcome is clearly dictated by this court’s decision in the South Bay United Pentecostal Church v. Newsom," reads the Supreme Court decision.

The churches are San Jose’s Gateway City Church and The Spectrum Church, Campbell’s The Home Church and Orchard Community Church, and Morgan Hill’s Trinity Bible Church. They have argued the county has lacked scientific backing to justify its ban on indoor worship services and that it is unlawfully denying the churches’ rights to peacefully assemble and freely exercise their religion.

Following the high court’s lifting of California’s statewide ban on indoor religious services, Santa Clara County argued that it was not subject to the ruling because it prohibited all indoor gatherings — regardless of whether they’re related to religion — rather than instituting a specific ban on indoor religious services.

Shortly after, the five Santa Clara County churches filed a motion in the U.S. District Court for the Northern District of California to attempt to block the county’s ban, arguing that the U.S. Supreme Court’s ruling must apply to the county. A U.S. district court judge granted an injunction to temporarily block the county’s ban on indoor worship services.

But in an abrupt reversal less than two days later, the U.S. Court of Appeals for the Ninth Circuit temporarily suspended the order, concluding that the county’s prohibition on all indoor gatherings — including indoor religious services — could remain in place for the time being. -Mercury News

"The Supreme Court order was issued without any analysis at all of the County’s gathering rules, which have always been neutral and applied equally to all gatherings across-the-board," said attorney James Williams, counsel for Santa Clara County. "Indoor gatherings of all kinds remain very risky, and we continue to urge all religious institutions to carefully follow the public health recommendations to avoid spread of COVID-19 among their congregations and the broader community."

Bishop Oscar Cantú disagrees, saying that he joins "all Catholics and people of faith in Santa Clara County in expressing our satisfaction," adding in a Friday night statement: "Banning indoor worship and yet allowing people to gather at airports, personal services establishments, and retail shopping is unconstitutional — and the Supreme Court has said so several times."

Tyler Durden Sat, 02/27/2021 - 16:00
  • 27 février 2021 à 22:00

SUNY Suspends Education Student For Posting Views On Biological Gender

Par Tyler Durden
SUNY Suspends Education Student For Posting Views On Biological Gender

Authored by Jonathan Turley,

There could be a significant First Amendment case brewing in New York after the School of Education at the State University of New York-Geneseo suspended student Owen Stevens for posting his view that gender is limited to biologically males and females.  As a state institution, SUNY is subject to the limitations of the First Amendment and Stevens could challenge the action based on his statements on Instagram.

I have not been able to find the letter sent to Stevens by the school but it is quoted on a conservative website, The Daily Wire. According to that report, Owen posted on Instagram that there are only two genders. This may be that posting:

The school reportedly maintains that such statements made on social media are grounds for suspension and other disciplinary action. 

While she did not refer to him by name, SUNY-Geneseo President Denise Battles sent out a message stating that “[y]esterday, I was made aware of a current student’s Instagram posts pertaining to transgender people.” Battles acknowledges that “There are clear legal limitations to what a public university can do in response to objectionable speech.

As a result, there are few tools at our disposal to reduce the pain that such speech may cause.” However, the school then suspended Stevens.

A spokesperson is quoted by the Daily Wire declaring students must follow the “professional standards” of their chosen field by acting and behaving in ways that “may differ from their personal predilections.”

That does not sound like an accommodation of the First Amendment, which protects your right to express your “personal predilections.” Many object to his view of transgender persons, but it is a view that often expresses a myriad of religious, political, social, and biological beliefs.

The suspension letter reportedly states:

You continue to maintain, “I do not recognize the gender that they claim to be if they are not biologically that gender.”

This public position is in conflict with the Dignity for All Students Act requiring teachers to maintain a classroom environment protecting the mental and emotional well-being of all students.

The question is whether holding such beliefs means that Smith is incapable of maintaining a classroom that is respectful and protective of all students, including transgender students. We have previously discussed professors who express animosity toward white students, males, or conservatives but few have been subject to suspension or termination unless they manifest such bias or prejudice in classrooms or on campus. (See stories herehereherehere, and here) I have long opposed discipline for teachers for their expression of political or social views outside of schools. Indeed, as we have previously discussed, one professor called for more Trump supporters to be killed. Another called for strangling police. Rhode Island Professor Erik Loomis, who writes for the site Lawyers, Guns, and Money, said he saw “nothing wrong” with the killing of a conservative protester — a view defended by other academics.  Yet, recently a professor was suspended for writing against reparations.  The result seems like a sharp divergent treatment based on the content of views on the left or the right of the political spectrum in the treatment of faculty members.

The spokesperson told the site that “SUNY Geneseo respects every student’s right to freedom of speech and expression,” but “[b]y choosing to enter into certain professional fields, students agree to abide by the professional standards of their chosen field. At times, these professional standards dictate that students act and behave in certain ways that may differ from their personal predilections.”

Yet, Smith is not saying that he would apply his views in classrooms or refuse to comply with “professional standards.” Instead, the school seems to be saying that one of those professional standards is conforming your views (or at least your public statements) to the accepted views of a “chosen field.” That would seem like the abridgment of free speech.

Again, we do not have to agree with Smith to support his right to speak freely. We often support the free speech rights of individuals who espouse views that we find offensive or even grotesque. You cannot say that you are in favor of free speech so long as you do not use it in a way that we do not like. It is hard to see any limiting principle in the position of SUNY-Geneseo. It would mean that the “chosen field” of any student could limit their ability to speak out on issues in their private lives. The alternative is to enforce “professional standards” by requiring adherence to those standards in the professional setting.

The school may be looking at a substantial free speech challenge in this case and we will continue to follow it.

Tyler Durden Sat, 02/27/2021 - 15:30
  • 27 février 2021 à 21:30

"Begging The Fed For Guidance": BofA Expects The Fed To Address Markets "As Soon As This Week"

Par Tyler Durden
"Begging The Fed For Guidance": BofA Expects The Fed To Address Markets "As Soon As This Week"

In the immediate aftermath of Thursday's catastrophic 7Y auction - arguably the one Treasury auction that came the closest to failing with a record low bid to cover...

... and a record plunge in Indirect (foreign) demand...

... and which triggered a stop-loss liquidation cascade across the curve, but nowhere more so than in the 5Ys...

... we said that it is of utmost urgency for the Fed to step in and restore some stability in what is - at least in theory - the world's most liquidity bond market.

The Fed really needs to make an announcement here. What is going on in TSYs is not normal

— zerohedge (@zerohedge) February 25, 2021

So far the Fed has refused to intervene and stabilize the bond market, despite a surge in bond implied volatility that threatens to spillover in deeper into stockland and hammer the VIX.

Curiously, with European nominal rates still deeply negative despite the recent rout, it was an ECB banker - Greek Yannis Stournaras - who yesterday became the first to openly call for more QE in response to the soaring yields (here the "thinking" supposedly goes that when a flood of money finally triggers the inflation central bankers have been demanding for years, they want to add even more money to counterbalance it’s effect. Yes, this idiocy is considered high economic thought these days.)

In any case, on Friday Bank of America agreed with our view that some verbal Fed intervention is paramount, writing that "the market is begging the Fed for greater guidance" - something the Fed has generously provided in the past during times of market stress - and states that it now "expects the Fed to clarify policy expectations in the March FOMC meeting."

Why? Because, as BofA chief economist Ethan Harris writes, "the Fed is in a bind" since rising interest rates ("shall we say tantrum?"), prompted a tightening of financial conditions, yet at the same time the market is adamant that "higher rates may be justified."

Harris then notes that "since the Fed relies on “open mouth operations” to guide markets when the policy winds shift" it has become quite clear that "markets are asking for greater guidance." Something we tweeted two days ago. Harris' conclusion: a shift in Fed speak is coming at the upcoming FOMC meeting.

So what could the Fed say?

Looking back at prior policy shifts, BofA notes that the Fed has experimented with different forms of “open mouth operations.”

Early in the cycle, the Fed embraced threshold-based guidance. The prime example was between Dec 2012 and Dec 2013 when the Fed promised to keep rates at the zero-lower-bound until the unemployment rate fell below 6.5%. It turns out that NAIRU was a lot lower than 6.5%.

The Fed then pivoted to qualitative guidance. By March 2014, the Fed noted that rates would remain low for a “considerable time” after the asset purchase program ended. In December 2014, the Fed introduced the idea of “patience” in the path to normalizing rates. The buzz word of patience lasted until the summer when it started to lose favor.

By October 2015, the Fed statement discussed “whether it would be appropriate to raise the target range at its next meeting.” Back then, it took about 6 months for the Fed to transition the message and set the stage for hikes.

What is the take home lesson to Bank of America from these examples? 

  1. Qualitative guidance works better than quantitative;
  2. "Buzz" words help to set expectations;
  3. Slowly warn about policy changes – a 6 month window to set expectations could be appropriate.

As to why the Fed needs such a lengthy lead-in period, Harris puts it, "don’t tighten before you want to tighten" and explains that "on the one hand 'open mouth operations' avoid big market surprises when policy is changed. On the other hand, by shifting guidance slowly and well in advance, markets respond early and financial conditions tighten earlier too.

Indeed, Exhibit 5 and Exhibit 6 show that there is a positive relationship between the change in fed funds expectations and the change in 10Y yields, while there is little to no relationship between the actual change in the fed funds rate and the change in 10Y yields.

"And so by the time the Fed hikes, the market is over it."

That means that far from the Fed keeping silent until 2023 or even 2022 before addressing the violent tightening in financial conditions - as by then the bond market could well be in ruins - it will instead have to do so as soon as March 17 FOMC meeting which is in two weeks, when BofA warns to "expect the Fed to clarify policy expectations." In fact, the bank cautions, that "if the abrupt market moves persist, Fed officials might speak up as early as this coming week."

Tyler Durden Sat, 02/27/2021 - 15:00
  • 27 février 2021 à 21:00

As Lumber Prices Hit Record High, Homebuilders Urge Biden To Intervene

Par Tyler Durden
As Lumber Prices Hit Record High, Homebuilders Urge Biden To Intervene

By Robert Dalheim of Woodworking Network,

Lumber prices have hit $1,000 per thousand board feet, an all-time high, according to data from Random Lengths. That's double the price from three months ago.

"Price increases—some to record-setting levels—and long delivery delays are causing hardships for construction firms that are also experiencing challenges in completing projects with crews limited by illness or new work site procedures resulting from the pandemic," the Associated General Contractors of America (AGC) wrote in a release.

“The extreme price increases, as reflected in today’s producer price index report and other sources, are harming contractors on existing projects and making it difficult to bid new work at a profitable level,” said Ken Simonson, the association’s chief economist. “While contractors have kept bids nearly flat until now, project owners and budget officials should anticipate the prospect that contractors will have to pass along their higher costs in upcoming bids.”

The AGC has joined the National Association of Home Builders (NAHB) in urging intervention from President Biden.

"AGC believes the White House can play a constructive role in mitigating this growing threat to multifamily housing and other construction sectors by urging domestic lumber producers to ramp up production to ease growing shortages and making it a priority to work with Canada on a new softwood lumber agreement," the AGC wrote in a letter.

"We also urge the administration to look for ways to facilitate shortening delivery times of lumber to end users. This could include easing cross-border truck and rail shipments, unloading at ports, hauling of logs and other raw materials to mills and engineered-wood producers, and shipping wood products to distributors and construction sites."

The NAHB called on the White House the end tariffs on Canadian lumber shipments last week.

"Lumber price spikes are not only sidelining buyers during a period of high demand, they are causing many sales to fall through and forcing builders to put projects on hold at a time when home inventories are already at a record low," it said in a statement.

Higher prices are likely behind the drop in single-family housing starts for January, which saw a 12 percent dip from December. OSB prices have also tripled since April.

Some of our readers have told us that the rising prices are affecting their woodworking companies. 

"The price increases are also crushing the industrial/furniture market," one reader wrote. "As a woodworking company we worry that these prices will tip some of our clients towards tooling wood parts in plastic or other materials. Once that happens the clients are lost forever. Many of our clients don't believe us when we explain the cost of plywood and other sheet products. We send them the invoices so that they can compare what we quoted to what we need based on current plywood prices. Don't forget that the housing market is always at the front of the line and the woodworkers way at the back - even in good times."

Tyler Durden Sat, 02/27/2021 - 14:30
  • 27 février 2021 à 20:30
Hier — 27 février 2021Zero Hedge

GoFundMe Campaign Seeks $15,000 For Silver Short Squeeze Billboards

Par Tyler Durden
GoFundMe Campaign Seeks $15,000 For Silver Short Squeeze Billboards

Thanks to some on r/WallStreetBets (WSB) and others on social media, the wider public is starting to grasp the corruption and cronyism in the financial markets including in the paper gold and paper silver markets. 

The silver bullion market is one of the most manipulated on earth. After WSB 'Reddit-Raiders' sent GameStop shares sky-high earlier this month, some on the forum attempted to squeeze banks that are manipulating silver markets.

 Judging by the unprecedented flows into the Silver ETF (SLV) weeks ago, almost double the previous record inflow for this 15-year-old ETF, the awareness only continues to grow. 

Despite the dismal squeeze on the paper markets, there was an "unprecedented" grab for physical silver, according to

Just as Redditors bought billboards in Times Square and across the country, urging people to buy GameStop - it appears someone and a whole lot of donors is raising money to fund "Silver Squeeze" billboards. 

On popular crowdfunding platform "GoFundMe," someone named Ivan Bayoukhi created a campaign to raise money to fund billboards for the awareness of "Silver Squeeze.

So far, 310 donors have raised $12,513 out of the $15,000 goal - and while billboard ad space is cheap because of the crushing virus pandemic denting the ad space - why the hell not. 

Here's what the description of the "Silver Squeeze" GoFundMe campaign says:

Silver movement will be Epic..

Couple of months or years down the lane and people will look back and say how this whole thing started..some 20000 like-minded guys, got tired of manipulation and started doing something that banks had no defense physical!! We chose to play the game on our turf and theirs.

Its matter of days or months when this community gets to million+ and imagine the horsepower when all these guys start buying..


Average people banning together in a collective manner against Wall Street hedge funds are epic - can almost describe these folks as 'decentralized hedge funds' of the people for the people waging war on big bankers. 

Donors of the "Silver Squeeze" commented as saying:

"Slv options are gonna pop!!," Tom Johnsohn Hiscock who donated $50 to the cause. 

"A very very effective location for you would be the Trans Canada Highway between Calgary and Banff!! 33,000 vehicles per day average. There is a row of billboards there," said donor Jeremy Tufts. 

"Time for main street to overtake wall street," said Brian Berkley who donated $100.

"F@ck JPM," donor ian farmer who gave $20 to the cause. 

With another round of stimulus checks coming down the pipe - the question is what will people buy - more GameStop, other 'meme stonks,' long volatility ETFs, physical silver, and or SLV. 

Tyler Durden Sat, 02/27/2021 - 14:00
  • 27 février 2021 à 20:00

Jerome 'Von Havenstein': Inflation... Or Bust!

Par Tyler Durden
Jerome 'Von Havenstein': Inflation... Or Bust!

Authored by MN Gordon via,

This week brought forth new evidence that – to be perfectly frank – we’re all screwed.

On Thursday, the yield on the 10 year Treasury note topped 1.55 percent.  Subsequently, the Dow Jones Industrial Average, after hitting an all-time high on Wednesday, dropped 559 points.  Wall Street must not be listening to Federal Reserve Chairman Jerome Powell.

Earlier in the week, Powell, in testimony to the Senate Banking Committee, confirmed that the central bank would keep the federal funds rate near zero until maximum employment is achieved.  In addition, the Fed, in its recently released semiannual Monetary Policy Report, confirmed it would continue to create credit from thin air to buy $80 billion per month of Treasuries and $40 billion per month of mortgage backed securities (MBS).

What’s more, the Report specified the Fed’s purchases of Treasuries and MBS “…will continue at least at this pace until substantial further progress has been made toward its maximum employment and price stability goals.”  The operative words being, “at least.”

What to make of it…

Central banking is a form of central planning.  And central planning is a form of state control.  And state control, as practiced in the United States, pertains not so much to the economics of producing income; but, rather, the methods for redistributing it.

State control, through inflationism, takes money saved and earned by individuals and covertly redistributes it to the central authority – i.e., Washington.  There it is consumed by ever expanding government social programs and colossal pentagon budgets.  What remains is wasted away by the endless array of bureaucracies and agencies.

Powell, without question, is a man of unyielding principles.  His core beliefs align with the central authority.  They also align with the twelve regional Federal Reserve Banks, which, according to the Ninth Circuit Court of Appeals“are independent, privately owned and locally controlled corporations.”

Hence, Powell endeavors to keep Federal Reserve Banks and their member banks flush with cash and liquidity.  He also endeavors to provide Washington an endless supply of cheap credit.

The point is, the higher interest rates run, the more Powell will intervene in credit markets, via Treasury and MBS purchases, to hold rates down.  The goal of maximum employment is merely a cover for what will be several trillion dollars more in quantitative easing.

Powell, we presume, grasps the importance of history.  He surely knows all fiat money is doomed to failure.  And he surely knows the dollar’s current place in a fiat money’s lifecycle.

Powell, no doubt, recognizes the dollar’s end is nigh.  But what can he really do?  He has a tiger by the tail.  He can’t reverse course.  Like others before him, he must ride it to the bitter end…

The Grandmaster of Monetary Stimulus

Rudolf von Havenstein had been president of the Reichsbank – the German central bank – since 1908.  He knew the workings of central bank debt issuances better than anyone.  He was a central banker’s central banker.  He was good at it.

Thus, when he was called upon by history to deliver a miracle for the Deutches Reich in the aftermath of WWI, he knew exactly what to do.  He’d deliver monetary stimulus.  In fact, he’d already been at it for several years.

On August 4, 1914, at the start of the war to end all wars, the Goldmark – or gold-backed Reichmark – became the unbacked Papermark.  With gold out of the picture, the money supply could be expanded to meet the endless demands of war.

To this end, von Havenstein took public debt from 5.2 billion marks in 1914 to 105.3 billion marks in 1918.  Over this time, he increased the quantity of marks from 5.9 billion to 32.9 billion.  German wholesale prices rose 115 percent.

By the war’s end, Germany’s economy was in shambles.  Industrial production in 1920 had slipped to just 61 percent of the level seen in 1913.  With a weak economy, and under the crushing weight of debt, it was time for von Havenstein to really crank up the money printers.

In truth, he didn’t have much of a choice.  The limits of fiscal and monetary prudence had been crossed when the Goldmark was replaced with the Papermark.  Reversing course now would have brought an immediate economic collapse and societal discord.

Von Havenstein, faced with the choice of post-war depression or inflation, chose what he thought would be the easier softer way.  He considered inflation the lesser of two evils.  Plus it would lighten Germany’s war debt.

Jerome von Havenstein: Inflation Or Bust

Initially, the ill effects of the Reichsbank’s money supply inflation seemed to be limited.  As real, inflation adjusted wages declined, unemployment actually fell to record lows.  But, alas, a real McCoy crack-up boom was underway.

As the value of the Papermark continued to decline wage earners were continually shredded.  To combat the increasing destruction to wage earners the German government introduced mandatory wage indexing.  Upon this government intervention, unemployment immediately soared…running from record lows to record highs within just two years.

At the same time the decline in the Papermark’s purchasing power and external value accelerated until the currency, for all practical purposes, ceased to function as a viable medium of exchange.

Indeed, printing money can be stressful.  But printing extreme amounts of money can be downright terminal.

By the time von Havenstein died in late-November 1923 of a myocardial infarction, the central bank of Germany had printed over 500 quintillion marks.  Moderate inflation transformed to hyperinflation.  One U.S. dollar was worth 4.2 trillion marks by December 1923.

Moreover, the destruction of the mark brought destruction of society…and the rise of national socialism.  The medium-term political repercussions of this economic catastrophe soon engulfed the whole world.

Jerome Powell, like Rudolf von Havenstein, knows exactly what he’s doing.  In fact, he’s told the world what he’s doing.  It’s inflation or bust.

The gold market, which has slumped to below $1,800 per ounce, must think he’s bluffing.  This is a mistake.  If you understand nothing else understand this: Powell’s pursuit of inflation is as serious as a von Havenstein heart attack.

Tyler Durden Sat, 02/27/2021 - 13:30
  • 27 février 2021 à 19:30

"Early Spring, Winter Is Over?" - New Weather Models Suggest Warmer Weather Nears 

Par Tyler Durden
"Early Spring, Winter Is Over?" - New Weather Models Suggest Warmer Weather Nears 

After a brutal February plunged much of the US into a deep-freeze with multiple winter storms due to the split in the polar vortex (something we warned about in early January), one group of meteorologists are suggesting winter could be over for some areas as spring is ahead. 

"So early spring, winter is over? There is literally no winter in those maps - we think winter cold is wrapped up overall," said BAMWX's Kirk Heinz

Heinz, the chief meteorologist at the weather service firm, said, "with the remnants of the polar vortex forecast to move north of Alaska, the MJO focused in the Maritime Continent ahead and the atmospheric state quite La Niña ahead...warmth is expected to expand widespread across the central and easter US in the exact areas that have run over 10 degrees below normal on average most of February to date." 

BAMWX's weather model titled "Week 2 Temperature Departures & Week 2 % Of Normal Precipitation" shows between Mar. 5 to Mar. 11 that temperatures across West Central, Southwest, East Central, Southeast, Mid-Atlantic, and Northeast will be well above average — drier conditions are expected for much of the country through the period. 

The next weather model titled "Week 3/4 Temperature Outlook & Week 3/4 Precipitation Outlook" shows between Mar.12 to Mar. 25 above-average temperatures will be seen across the country — drier conditions in the Rockies but wetter in the Southwest. 

BAMWX suggests an "early start to the planting year" is possible. 

We told readers last Monday to expect warmer weather between Feb. 23 to Mar. 10, though with the addition of BAMWX's data, perhaps warmer weather for the country could persist through the entire month of March. As we are all aware, weather modeling is difficult and subjected to change.

Tyler Durden Sat, 02/27/2021 - 13:05
  • 27 février 2021 à 19:05

Powell's Plan Has A Blind Spot And It Means Market Violence

Par Tyler Durden
Powell's Plan Has A Blind Spot And It Means Market Violence

Authored by Oliver Renick via LinkedIn,

There is a logical blind spot in the Fed's framework that will create forced selling of bonds even without changes to the Fed's balance sheet or stated hiking plans. It stems from the notion that without a defined counteracting force to inflation, the risk/reward of holding bonds when growth is trending as it is now is so skewed towards selling that it's likely to create severe spikes in yields until some equilibrium is reached, likely through yield-curve control.

Here's what I see.

The central bank has told us they're not going to fight inflation until it runs at their target for some undefined period of time. So policymakers have unprecedented free reign to throw everything they can at the economy to get it going. That means that if there is some theoretical way to generate upward price pressure greater than the deflationary forces of demographics and technology, we are going to find it. You don't have to have some strong view on the economy to see this. It's a Murphy's Law-type principle that over a long enough time horizon, if it's possible, it will happen. As Ian Malcolm says in Jurassic Park, life will find a way. So will inflation. Whether it's this year, next, in 5 or 100, the Fed has promised it won't get in the way until we find it. So we can be absolutely certain we will find it.

And there's the glitch. Markets are not supposed to have absolute certainty.

By telegraphing its plan to let inflation run past the 2% target, the Fed has given investors exploitable asymmetric knowledge by reducing the number of actions it can possibly take by eliminating the possibility of a hike until sustained inflation. By turning a defined barrier into a flexible one, the economy and the market will naturally discover the limit of that flexibility.

An analogy: if a kid knows his parent will ground him if he curses more than five times a day, he'll stop cursing at four. But if they say they'll ground him after a certain number of curse words between five and ten, and the kid likes to curse, he's naturally going to figure out where the grounding threshold is, i.e., he'll go until he gets slapped. Bonds will not stop selling until they find out where they make daddy Powell uncomfortable.

Perhaps more attuned to markets, think about it through poker. If I know the most important player at the table doesn't play a certain hand, I'm going to make above my expected value because I have information I'm not supposed to. It changes the game in a way that I can manipulate. The most important player in the bond market is the Fed, and because investors know Powell's hands are tied, they can exploit this knowledge by selling their bonds in advance of the inflation that we can assume to be inevitable. Why buy a bond now if I know it's going to be cheaper later on? Maybe if I like the income, but, 1.5% ain't too hot. So we're unlikely to reach a natural equilibrium anytime soon.

The mistake I see investors making right now is connecting the long bond with the Fed's commitment to low rates. The most common thing I hear from guests is "yields won't rise too much because Powell isn't hiking." Yet long-term yields literally bottomed this summer as Powell unveiled his plan! And now they're spiking without any hot inflation prints -- just expectations and improving economic data. It's quite clear that the market will determine rates outside of the Fed's overnight purview.

I joked today that the only thing that may calm the stock market's response to rates is if Jay Powell talks about hiking. It's actually not even that crazy. The ascent in yields will be relentless under average inflation targeting because it removes the counteracting force (hikes) that would otherwise slow the economy. So when the time comes and the Fed talks hikes, yields will finally slow their ascent as investors process the notion of hikes slowing down the economy.

If it sounds backwards, it's because it is. It's been that way since the Fed caved to investors and reversed course in December 2018, not because of any issues with the economy (loosest financial conditions for rate cuts ever in 2019), but because markets and the President pressured Powell to do so. That skewed the risk/reward too far in favor of buying bonds for investors not to do so. If the economy is bad, the Fed cuts; if economy is good, Fed cuts anyway. We then had a year-long period of falling ten-year yields despite rising inflation, and it's been upside down ever since. There's no reason not to expect the same speed to the downside as we got on the upside.

I'm not saying the Fed is doing a poor job today; it's clear we needed to boost our economy and not fretting over inflation seems like an OK approach in this snapshot of time. But the price investors pay will be unprecedented bond volatility, and that'll likely hurt the stock market by transition. There is no magic wand of words Jay Powell can use to stop bonds from trading with inflationary prospects, in fact it seems like the more dovish he gets, the harder bonds drop (which makes total sense according to my thesis). If he wants to stop yields from spiking in a way that disrupts the market, it's going to take another wall of money and he's going to have to buy the bonds himself. Maybe Powell knows this and it's not a blind spot. Maybe he plans on yield-curve control after all.

Bottom line: policymakers are playing with matches and Thursday is an example of what happens when investors smell smoke. Yes, growth and recovery are driving the direction of yields, but the severity of the moves will in part be due to inefficient market dynamics fostered by the Fed since 2018.

Tyler Durden Sat, 02/27/2021 - 12:40
  • 27 février 2021 à 18:40

Russian Trials Find Sputnik V Performs "Very Well" Against Virus Variants

Par Tyler Durden
Russian Trials Find Sputnik V Performs "Very Well" Against Virus Variants

A potential breakthrough regarding Russia's Sputnik V vaccine and its ability to provide immunity in response to the worrisome new mutations of coronavirus popping up around the globe is being reported in international press on Saturday, which is in stark contrast to the prior typically negative coverage of Russia's vaccine rollout. 

"A Russian trial testing the effectiveness of revaccination with the Sputnik V shot to protect against new mutations of the coronavirus is producing strong results, researchers said on Saturday," Reuters reports.

Putin last month ordered a review due by mid-March of the Russian-made vaccine's ability to protect against the new mutations, found lately in various countries across Western Europe and as far away as South Africa, as well as New York and California. 

"(A) recent study carried out by the Gamaleya Centre in Russia showed that revaccination with Sputnik V vaccine is working very well against new coronavirus mutations, including the UK and South African strains of coronavirus," announced Denis Logunov, a deputy director of the center that developed the Russian vaccine. 

"We believe that vector-based vaccines are actually better for future revaccinations than vaccines based on other platforms," Logunov added.

While research and trial results of the new review have not been made available yet, these latest headlines on the 'hopefulness' of Sputnik V's effectiveness regarding the new strains stand in stark contrast to the highly negative commentary from Western officials which marked much of the end of last year.

For example just last week...

Some EU states are being enticed by the Russian and Chinese #vaccines, but EU health commissioner @SKyriakidesEU says they still have to first undergo an #EuropeanMedicinesAgency scientific assessment.#EUWeekInReview

— EUobserver (@euobs) February 21, 2021

Meanwhile in the United States...

Pfizer and BioNTech Studying Third Covid-19 Vaccine Dose to Fight New Strains - WSJ

— FxMacro (@fxmacro) February 27, 2021

The prime US vaccines appear to be far behind where Russian researchers are claiming to be.

According to The Wall Street Journal, "Both the Pfizer-BioNTech and Moderna Covid-19 vaccines appeared to generate a weaker immune response to the strain identified in South Africa, as did other shots in the advanced stages of development.

"The companies said Thursday they have started the small study to see whether a third dose of their authorized Covid-19 vaccine would increase its effectiveness against new variants, such as the strain first identified in South Africa," the report adds.

Tyler Durden Sat, 02/27/2021 - 12:15
  • 27 février 2021 à 18:15

Biden Says US Will "Never" Accept Russia's Annexation Of Crimea

Par Tyler Durden
Biden Says US Will "Never" Accept Russia's Annexation Of Crimea

Authored by Dave DeCamp via,

President Biden released a statement on Friday marking the seventh anniversary of Russia’s annexation of Crimea where he said the US will "never" accept Russian sovereignty over the peninsula.

"The United States continues to stand with Ukraine and its allies and partners today, as it has from the beginning of this conflict," Biden said. "The United States does not and will never recognize Russia's purported annexation of the peninsula, and we will stand with Ukraine against Russia’s aggressive acts."

Pro-Russian supporters attend a rally in Simferopol, 2014. Via Reuters

Biden's statement also laid sole blame for bloodshed in Kiev during the crisis on Russians: "We will also continue to honor the courage and hope of the Revolution of Dignity, in which the Ukrainian people faced down sniper fire and enforcers in riot gear on the Maidan and demanded a new beginning for their country," the statement added.

Left out of Biden’s statement was the reason for the Russian annexation. In 2014, the US-orchestrated a coup in Ukraine.

The largely ethnic Russian population of Crimea rejected the new nationalist anti-Russian government in Kyiv that even had neo-nazis in its midst. Polls after the annexation show the majority of Crimeans were in favor of joining Russia.

The Biden family benefited greatly from the coup. Shortly after the change in government, President Biden’s son Hunter landed a high-paying job on the board of Burisma, a Ukrainian natural gas company.

President Biden tapped an architect of the Ukraine coup for a high-level position in the State Department. Victoria Nuland, the wife of neoconservative Robert Kagan, is the nominee to be the under secretary of state for political affairs.

A recording of a phone call between Nuland and then-US Ambassador to Ukraine Geoffrey Pyatt was leaked and released on YouTube on February 4th, 2014. In the call, Nuland and Pyatt discussed who should replace the government of former Ukrainian Prime Minister Viktor Yanukovych, who was forced to step down on February 22nd, 2014.

Tyler Durden Sat, 02/27/2021 - 11:50
  • 27 février 2021 à 17:50

"No Solution Without Beijing": China Accounts For 30% Of Global CO2 Emmission

Par Tyler Durden
"No Solution Without Beijing": China Accounts For 30% Of Global CO2 Emmission

For all the newly hatched virtue-signaling "climate change warriors", starting with Greta Thunberg of course, we have just one message: please take your complaints to Beijing (if you dare).

As Goldman's Chinese economists write, to date, over 120 countries have announced targets to cut greenhouse gas (GHG) emissions and China’s recent commitment "may be one of the most ambitious", if not most ridiculous. At the United Nations General Assembly last September, President Xi Jingping pledged that China is targeting peak CO2 emissions by 2030 and carbon neutrality by 2060. At the Fifth Plenum of the 19th Party Congress last October, discussions around the 14th Five-Year Plan and China’s long-term goals outlined stabilizing and falling carbon emissions by 2035. Last December, the government issued a white paper titled “China’s energy development in the new era”, and in February 2021, the State Council released the guidance for building a green low-carbon economic system.

While it is clear that China has - at least in theory - begun to lay the ground for achieving net zero emissions over the next four decades, the question is how much of this is just a virtuous smokescreen to shut up critics. In response, Goldman analysts have done extensive work on this topic, modeling the technological paths to net zero sector by sector, from renewable power to electric mobility, and from hydrogen to carbon capture, to we provide a macro perspective and look at the economics of China de-carbonization given the unique challenges it faces and the advantages it has.

As Goldman summarizes, "there is little doubt that “Carbon Neutral 2060” will be an enormous undertaking given China’s natural endowment of coal, China’s economic structure of being an industrial powerhouse and its current stage of economic development." That said, features of its political and economic system also suggest that China may be better positioned to take on the challenge than other countries. In the case of China, Goldman expects a two-step multi-speed approach where most of the emission-cutting takes place after 2035 and different sectors and regions proceed at different paces.

While nobody can predict what happens in 40 years, one thing is clear: there can be "no global solution without China."

Goldman writes that solving the problem of "climate change" requires drastic decreases in global greenhouse gas emissions. But cutting global emissions is also extremely challenging because of various externalities (e.g., the cost of one country’s emissions may be borne by people in another country) and collective action failures (e.g., polluting activity may move from high carbon tax jurisdictions to low carbon tax jurisdictions). In this context, China will need to be an integral part of any solution to the climate change problem.

Why? Because with China accounting for 30% of the world’s total CO2 emissions, Goldman writes that "no global solution is viable without China."

Some more details from Goldman:

Relative to its global shares of population and GDP, China emits significantly more CO2 (Exhibit 2). There are two reasons for this.

  • First, China is rich in coal and coal generates much more CO2 than natural gas for every unit of electricity produced. For example, coal accounts for 68% of China’s electricity supply vs. 29% in the US and 21% in the European Union.
  • Second, China’s economic structure is more energy-intensive than many other countries. For example, for every Yuan of GDP produced, the secondary industry (industrials) consumes three times as much electricity as the tertiary industry (service) in China. Despite the ongoing progress in expanding the service sector, the secondary industry is still 39% of China’s GDP, compared to only 18% in the US.

Besides the difficulties originated from its economic structure, China’s development stage imposes additional challenges to its de-carbonization efforts. The next chart shows the relationship between per capita GDP and per capita emissions over 1990-2019 data for 20 major economies. Initially, as GDP increases from a low level, emissions rise accordingly, and it is only after GDP per capita reaches around $40,000 in PPP terms – which was the level for the US in 1990 and Japan in 2015 – do emissions per capita begin to stabilize and decline. That turning point is about 2.5 times of China’s current per capita GDP. That means that realistically, Chinese CO2 emissions are set to double in the coming years!

Given the significant differences across economies, Goldman also compare mainland China with Taiwan and South Korea, two economies that share similar culture and economic structure to China. It aligned the mainland China economy in 2010 with Taiwan’s in 1987 and South Korea’s in 1991, as these years marked the respective times when GDP growth started to decelerate notably. Exhibit 4 shows that mainland China’s GDP growth has been tracking the experience of Taiwan’s and South Korea’s closely and may average around 5% over the next 10 years. Exhibit 5 shows that, if mainland China’s carbon emissions were to also follow Taiwan and South Korea’s experience, they would increase significantly over the coming decade in the absence of drastic policy changes and/or technological breakthroughs.

There are many other obstacles faced by China, including the relatively young capital stock and potentially bigger financial spillover effects. On capital stock, the International Energy Agency (IEA) estimates that the average age of assets in Chinese chemical, iron and steel, and cement industries is only around 10 years, while the typical lifetime of these assets is 30-40 years (Exhibit 6). Replacing relative young capital stock is more likely to create stranded assets and generate negative wealth effects.

On financial spillovers, because of China’s heavy reliance on coal for energy, coal mining and coal-fired power utilities also account for a significant share of total bank lending in China - approximately 5% - compared to other countries (e.g., 1% in Japan and South Korea). If demand for coal were to contract rapidly, many coal mines and coal-fired power plants could become insolvent, raising the potential for default on their loans and bonds. Some researchers have suggested that default rates among coal miners could exceed 20% by 2030. Under this scenario, the sector would come under as much stress as when energy prices collapsed in 2014 (Exhibit 7).4 The losses on bank loans could ultimately reduce real GDP by 1pp based on Goldman estimates of the links between NPLs, bank lending, and economic growth.

While there are various other observations in the full Goldman report (available in the usual place), the bank's conclusion is that in its pursuit of a "multi-speed approach", Beijing needs to strike a balancing act in nachieving net zero emissions: too fast a change may derail other policy goals such as doubling income by 2035, but moving too slowly could lead emissions to peak at too high a level. The first of the two steps features low-cost abatement measures such as renewable power and waste/recycling as well as R&D investment to improve abatement technologies. Higher-income regions within China with a low energy intensity of output can afford to move first and their focus is likely to be on the transportation sector.

The bottom line is that as with everything else, whatever China states in public, what happens in reality is usually the opposite. Which is why all those hoping that Beijing will hold true to its promise of carbon neutrality by 2060... will be disappointed. It's also why the true environmentalists - and not those poseurs hoping for a quick popularity or SnapChat boost - are encouraged to bring their complaints and laments to China and to stop focusing so much on the US...

... whose emissions are now at a three decade low and dropping fast.

Tyler Durden Sat, 02/27/2021 - 11:25
  • 27 février 2021 à 17:25

John Durham Resigns As US Attorney, Will Continue Role as Special Counsel

Par Tyler Durden
John Durham Resigns As US Attorney, Will Continue Role as Special Counsel

Authored by Jack Phillips via The Epoch Times,

U.S. Attorney John Durham, who was tapped by former Attorney General William Barr to lead a special counsel probe into the origins of the Trump-Russia inquiry, announced his resignation from his position as U.S. attorney of the District of Connecticut.

A spokesperson for the Department of Justice (DOJ) confirmed to the Daily Caller and other news outlets that Durham is still special counsel. Fox News reporter Chad Pegram also reported that Durham will continue his work in probing the origins of the FBI’s Russia investigation and whether there were any irregularities and wrongdoing.

A post on the DOJ’s website states that Durham’s office as special counsel was moved to the Main Justice department.

“My career has been as fulfilling as I could ever have imagined when I graduated from law school way back in 1975,” Durham said in a news release from the Justice Department on Friday.

“Much of that fulfillment has come from all the people with whom I’ve been blessed to share this workplace, and in our partner law enforcement agencies. My love and respect for this Office and the vitally important work done here have never diminished. It has been a tremendous honor to serve as U.S. Attorney, and as a career prosecutor before that, and I will sorely miss it.”

The Epoch Times reached out to the DOJ and White House to confirm whether Durham, who has not yet released his long-awaited report, will stay special counsel.

Several weeks ago, President Joe Biden’s administration had asked U.S. attorneys to resign by the end of February.

A justice department spokesman told news outlets in early February that “continuing the practice of new administrations, President Biden and the Department of Justice have begun the transition process for the U.S. Attorneys.”

In his probe, Durham has issued few public statements but in December 2019, he disputed some of the findings of the Justice Department’s inspector general, Michael Horowitz, who had concluded that the FBI was justified in opening its probe as to whether former President Donald Trump’s campaign colluded with the Russian government.

“Based on the evidence collected to date, and while our investigation is ongoing, last month we advised the Inspector General that we do not agree with some of the report’s conclusions as to predication and how the FBI case was opened,” Durham said in a DOJ statement at the time.

So far, Durham netted a single charge and guilty plea in August after former FBI lawyer Kevin Clinesmith, who was accused of altering an email about Trump campaign associate Carter Page.

Barr in December told the Wall Street Journal that Durham was making “significant progress” in his investigation, but Trump said weeks before that that Durham did not want to investigate top FBI officials, including former Director James Comey and his deputy, Andrew McCabe.

“We’re still waiting for a report from a man named Durham, who I have never spoken to, and I have never met. They can go after me before the election as much as they want, but unfortunately Mr. Durham didn’t want to go after these people, or have anything to do with going after them before the election. So who knows if he is ever going to even do a report,” said Trump.

The former commander-in-chief has long asserted that the Obama administration weaponized the FBI and DOJ to carry out allegedly unjust investigations into his 2016 campaign, often describing it as the “greatest witch hunt” in U.S. history.

Barr also told the WSJ that the most revealing documents pertaining to the origins of the Trump-Russia probe, known as Crossfire Hurricane, have already been made public—although Barr’s assertion has been disputed by independent researchers.

According to the DOJ’s news release on Friday, First Assistant U.S. Attorney Leonard C Boyle will serve as acting U.S. attorney after Durham leaves by Feb. 28.

“The Office will be in the extraordinarily capable hands of Len and our superb supervisory team who, together, guarantee that the proper administration of justice will continue uninterrupted in our District,” Durham said in the news release.

Tyler Durden Sat, 02/27/2021 - 11:00
  • 27 février 2021 à 17:00

"Letting A Murderer Walk": Leading Dems Outraged MbS Gets 'Free Pass' From Biden

Par Tyler Durden
"Letting A Murderer Walk": Leading Dems Outraged MbS Gets 'Free Pass' From Biden

Accompanying the public release of the ODNI report which finds that Crown Prince Mohammed bin Salman (MbS) "approved" of the 2018 murder of  journalist Jamal Khashoggi, which was based mostly on a prior CIA investigation into the death, the US announced sanctions on multiple individuals identified in the report but stopped short slapping MbS himself with penalties

Among these is Ahmad Hassan Mohammed al Asiri, former deputy head of Saudi Arabia’s General Intelligence Presidency, who the US Treasury sanctioned for being the top level operative charged with carrying out Khashoggi's assassination at the consul in Istanbul.

Also, 76 Saudis were hit with what's been dubbed the "Khashoggi Ban" (on travel) which targets those engaged in "extraterritorial counter-dissident activities" which seek violence or intimidation of overseas dissidents "including but not limited to the Khashoggi killing." A number of these were actually part of MbS' "elite" private security detail which "answers only to him" - as the report reads.

As we detailed Friday, the kingdom has formally rejected the US intelligence report's findings, saying through official SPA:

The Saudi Ministry of Foreign Affairs states that the Kingdom’s government completely rejects what was stated in the U.S. report provided to Congress on the crime of killing citizen Jamal Khashoggi.

The Kingdom of Saudi Arabia "categorically rejects the abusive and incorrect conclusions" the official said. "The concerned individuals were convicted and sentenced by the courts in the Kingdom, and these sentences were welcomed by the family of Jamal Khashoggi, may he Rest In Peace," it added.

Meanwhile there's growing criticism even from within Biden's own party leadership in Congress that the president is being no different from Trump in giving MbS a free pass.

There’s an emerging view that Biden is doing the same thing as Trump—that while the words are different, MBS is still getting a pass in the end. @jaketapper is right about that. At the same time, Biden ended Trump’s policy of boosting the Saudis with arms sales & support in Yemen

— Andrew Desiderio (@AndrewDesiderio) February 26, 2021

In particular Adam Schiff, the Democrat Chair of the House Permanent Select Committee on Intelligence, is demanding no less than the following severe action:

"The President should not meet with the Crown Prince, or talk with him, and the Administration should consider sanctions on assets in the Saudi Public Investment Fund he controls that have any link to the crime."

Here's Schiff's full statement...

Biden getting lots of pushback now

Schiff: “The Biden Administration should explore ways to ensure the repercussions for the brutal murder of Mr. Khashoggi go beyond those who carried it out, to the one who ordered it — the Crown Prince himself. He has blood on his hands...”

— Andrew Desiderio (@AndrewDesiderio) February 26, 2021

There's further growing pushback in the mainstream media, surprisingly, that Biden is ready to essentially "let the murderer walk":


"Instead of imposing sanctions on M.B.S., Biden appears ready to let the murderer walk. The weak message to other thuggish dictators considering such a murder is: Please don’t do it, but we’ll still work with you if we have to."

— Hassan Hassan (@hxhassan) February 27, 2021

Despite Biden's recent and past rhetoric of 'getting tough' on the Saudis, presumably intended as opposite Trump's policy of essentially shielding Riyadh, the "punishment" on MbS will likely now go no further than the public and international humiliation of being named in the ODNI report.

And it won't take long for things to return to "business as usual" - including more billions in weapons sales - between the US and the kingdom.

Tyler Durden Sat, 02/27/2021 - 10:35
  • 27 février 2021 à 16:35

Despite The Fed, The Bond Market Is Hiking Rates

Par Tyler Durden
Despite The Fed, The Bond Market Is Hiking Rates

Authored by Lance Roberts via,

Last week, we discussed that the market was likely starting to adjust for higher rates. As we stated, historically, there is little room for error as higher rates undermine one of the critical “bullish supports” that low rates justify high valuations.

This past week, rates jumped higher, putting a further pause in the stock rally for now. As we stated over the last few weeks, the upside remains limited with the money-flow sell signal still intact. (The vertical dashed blue line denotes when the signals initially triggered.)

Thursday morning before the market opened, I discussed the two areas we watch very closely: the 10-year treasury rate and the volatility index. Both were on extremely oversold signals, and if they turned higher, such would suggest a continued correction in the market. That turned out to indeed be the case.

Currently, as shown above, the money flows remain positive, but “sell signals” are firmly intactSuch suggests downward pressure on prices currently.

We do expect that market will likely muster a short-term oversold rally next week. However, the risk of a continued correction in March is likely if money flows deteriorate further. It is advisable to use any rallies to reduce equity risk and rebalance allocations accordingly.

We continue to suggest some caution. Despite media claims to the contrary, higher interest rates will matter, as we will discuss next. More importantly, they tend to matter a lot.

The Fed Is Walking Into A Trap

We sent the following market commentary out to our RIAPRO subscribers yesterday morning:

  • Jim Bullard: “The rise in bond yields is a good sign so far.”



Jerome Powell, Jim Bullard, Esther George, Raphael Bostic, and other Fed members are steadfast in their determination to use an excessive amount of monetary stimulus to promote inflation and growth. The reflationary trade and the weak dollar over the last few months are confirmation that investors believe the Fed is making headway toward its goals.

The problem is that bond investors also believe they are making progress. On Tuesday and Wednesday, Jerome Powell said that he is not concerned about inflation and will keep the monetary pedal to the metal in no uncertain terms. The quotes above are all excellent reasons for bond investors to keep selling.

Selling in the bond market became problematic this week as yields in the economically sensitive 5-and 7-year sectors rose precipitously. Previously, it was 10- and 30-year bonds taking the brunt of selling activity. The shorter, intermediate sectors largely determine mortgage, corporate, and auto borrowing rates.

They steer economic activity.

While the Fed is running accommodative monetary policy, the market is increasingly imposing tighter financial conditions.

The Fed has a choice. They can watch yields rise to the detriment of economic growth, or they can walk back monetary policy. Doing so requires tapering QE and raising rates. Either action will pose problems for overvalued equity markets based on a tailwind of easy monetary policy.

To put it bluntly, the Fed is walking into a trap where at some point, they will get forced into deciding between rescuing the bond market or the stock market.

Why Higher Rates Are A Problem

It is essential to understand the impact of rates on a heavily leveraged economy.

1) Economic growth is still dependent on massive levels of monetary interventions. An increase in rates curtails growth as rising borrowing costs slows consumption.

2) The Federal Reserve runs the world’s largest hedge fund with over $7.5-Trillion in assets. Long Term Capital Mgmt., which managed only $100 billion, nearly derailed the economy when rising rates caused its collapse. The Fed is 75x that size.

3) Rising interest rates will immediately slow the housing market. People buy payments, not houses, and rising rates mean higher payments.

4) An increase in interest rates means higher borrowing costs which lowers profit margins for corporations. 

5) One of the main bullish arguments over the last 11-years remains stocks are cheap based on low interest rates. That will change very quickly.

6) The negative impact on the massive derivatives market could lead to another credit crisis as rate-spread derivatives go bust.

7) As rates increase, so do the variable rate interest payments on credit cards. With the consumer already impacted by stagnant wages, under-employment, and high costs of living; a rise in debt payments would further curtail disposable incomes. Such would lead to a contraction in spending and rising defaults. (Which are already happening as we speak)

8) Rising defaults on the debt will negatively impact banks that are still not adequately capitalized and still burdened by massive levels of bad debt.

9) Commodities, which are sensitive to the direction and strength of the global economy, will revert as economic growth slows.

10) The deficit/GDP ratio will surge as borrowing costs rise sharply. The many forecasts for lower future deficits will crumble as new estimates begin to propel higher.

I could go on, but you get the idea.

Putting It In Pictures

The ramifications of rising interest rates apply to every aspect of the economy.

As rates rise, so do rates on credit card payments, auto loans, business loans, capital expenditures, leases, etc., while corporate profitability gets reduced.

Currently, the economy requires almost $4.50 in debt to manufacture $1.00 of economic growth. Given the dependence on debt to fund growth, higher interest rates would be inherently destructive.

More importantly, consumers have sunk themselves deeper into debt as well. Currently, the gap between wages and the costs of supporting the required “standard of living” is at a record. With a requirement of over $16,000 in debt to maintain living standards, there is little ability to absorb higher rates before it drastically curbs consumption. 

The annual deficit of over $4000 to make up the gap between the cost of living and current incomes increases debt loads on consumers. Higher interest rates will further absorb discretionary incomes into debt service.

“But what about those charts that show the average American has deleveraged themselves? “

The vast majority of the deleveraging only occurred in the top 20% of income earners, which you would expect. It is hard to suggest that a family barely making ends meet before the pandemic crisis suddenly found excess cash flow to pay off debt.

Interest rates matter. When rates hit a point where consumers and businesses can’t justify further indebtedness, a credit-driven economy slows down.

Tyler Durden Sat, 02/27/2021 - 10:10
  • 27 février 2021 à 16:10

"Eventually, The Party Ends" - Buffett Releases Annual Letter, Repurchases Record $25BN In BRK Stock

Par Tyler Durden
"Eventually, The Party Ends" - Buffett Releases Annual Letter, Repurchases Record $25BN In BRK Stock

Warren Buffett, published his annual letter to Berkshire Hathaway shareholders on Saturday. The billionaire has been updating his shareholders in the same format for more than six decades. 

The 90-year-old began on a slightly dour - clearly political - tone:

"We retain our constitutional aspiration of becoming 'a more perfect union.' Progress on that front has been slow, uneven and often discouraging. We have, however, moved forward and will continue to do so,"

But then the "Oracle of Omaha" rotated wisely back to 'f**k yeah Murica' mode:

"Today, many people forge similar miracles throughout the world, creating a spread of prosperity that benefits all of humanity. In its brief 232 years of existence, however, there has been no incubator for unleashing human potential like America," Buffett wrote.

"Despite some severe interruptions, our country's economic progress has been breathtaking."

"Our unwavering conclusion: Never bet against America," he said.

Here are some of the key points outlined in the letter to shareholders:

On "middle America":

Today, with much of finance, media, government and tech located in coastal areas, it’s easy to overlook the many miracles occurring in middle America. Let’s focus on two communities that provide stunning illustrations of the talent and ambition existing throughout our country. You will not be surprised that I begin with Omaha.

On the bond market:

Bonds are not the place to be these days. Can you believe that the income recently available from a 10-year U.S. Treasury bond – the yield was 0.93% at year-end – had fallen 94% from the 15.8% yield available in September 1981? In certain large and important countries, such as Germany and Japan, investors earn a negative return on trillions of dollars of sovereign debt. Fixed-income investors worldwide – whether pension funds, insurance companies or retirees – face a bleak future.

On crap bonds:

Some insurers, as well as other bond investors, may try to juice the pathetic returns now available by shifting their purchases to obligations backed by shaky borrowers. Risky loans, however, are not the answer to inadequate interest rates. Three decades ago, the once-mighty savings and loan industry destroyed itself, partly by ignoring that maxim.

On the economy:

"Despite some severe interruptions, our country’s economic progress has been breathtaking."

On overpriced mistakes:

Buffett conceded that the $11 billion writedown Berkshire took last year was due to what was a “mistake” in 2016, when he paid too much for Precision Castparts. Precision is a fine company, Buffett said, but he admitted he made a big error.

The final component in our GAAP figure – that ugly $11 billion write-down – is almost entirely the quantification of a mistake I made in 2016. That year, Berkshire purchased Precision Castparts (“PCC”), and I paid too much for the company.

No one misled me in any way – I was simply too optimistic about PCC’s normalized profit potential. Last year, my miscalculation was laid bare by adverse developments throughout the aerospace industry, PCC’s most important source of customers.

In purchasing PCC, Berkshire bought a fine company – the best in its business. Mark Donegan, PCC’s CEO, is a passionate manager who consistently pours the same energy into the business that he did before we purchased it. We are lucky to have him running things.

I believe I was right in concluding that PCC would, over time, earn good returns on the net tangible assets deployed in its operations. I was wrong, however, in judging the average amount of future earnings and, consequently, wrong in my calculation of the proper price to pay for the business.

On the energy markets:

"[O]ur country’s electric utilities need a massive makeover in which the ultimate costs will be staggering."

On the five types of investors in Berkshire:

Ownership of Berkshire now resides in five large “buckets,” one occupied by me as a “founder” of sorts. That bucket is certain to empty as the shares I own are annually distributed to various philanthropies.  Two of the remaining four buckets are filled by institutional investors, each handling other people’s money. That, however, is where the similarity between those buckets ends: Their investing procedures could not be more different.

In one institutional bucket are index funds, a large and mushrooming segment of the investment world. These funds simply mimic the index that they track. The favorite of index investors is the S&P 500, of which Berkshire is a component. Index funds, it should be emphasized, own Berkshire shares simply because they are required to do so. They are on automatic pilot, buying and selling only for “weighting” purposes.

In the other institutional bucket are professionals who manage their clients’ money, whether those funds belong to wealthy individuals, universities, pensioners or whomever. These professional managers have a mandate to move funds from one investment to another based on their judgment as to valuation and prospects. That is an honorable, though difficult, occupation.

We are happy to work for this “active” group, while they meanwhile search for a better place to deploy the funds of their clientele. Some managers, to be sure, have a long-term focus and trade very infrequently. Others use computers employing algorithms that may direct the purchase or sale of shares in a nano-second. Some professional investors will come and go based upon their macro-economic judgments.

Our fourth bucket consists of individual shareholders who operate in a manner similar to the active institutional managers I’ve just described. These owners, understandably, think of their Berkshire shares as a possible source of funds when they see another investment that excites them. We have no quarrel with that attitude, which is similar to the way we look at some of the equities we own at Berkshire.

All of that said, Charlie and I would be less than human if we did not feel a special kinship with our fifth bucket: the million-plus individual investors who simply trust us to represent their interests, whatever the future may bring. They have joined us with no intent to leave, adopting a mindset similar to that held by our original partners. Indeed, many investors from our partnership years, and/or their descendants, remain substantial owners of Berkshire.

On why Berkshire provides "hamburgers and coke" to investors, not French cuisine and exotic wines:

In 1958, Phil Fisher wrote a superb book on investing. In it, he analogized running a public company to managing a restaurant. If you are seeking diners, he said, you can attract a clientele and prosper featuring either hamburgers served with a Coke or a French cuisine accompanied by exotic wines. But you must not, Fisher warned, capriciously switch from one to the other: Your message to potential customers must be consistent with what they will find upon entering your premises.

At Berkshire, we have been serving hamburgers and Coke for 56 years. We cherish the clientele this fare has attracted.

The tens of millions of other investors and speculators in the United States and elsewhere have a wide variety of equity choices to fit their tastes. They will find CEOs and market gurus with enticing ideas. If they want price targets, managed earnings and “stories,” they will not lack suitors. “Technicians” will confidently instruct them as to what some wiggles on a chart portend for a stock’s next move. The calls for action will never stop.

Many of those investors, I should add, will do quite well. After all, ownership of stocks is very much a “positive-sum” game. Indeed, a patient and level-headed monkey, who constructs a portfolio by throwing 50 darts at a board listing all of the S&P 500, will – over time – enjoy dividends and capital gains, just as long as it never gets tempted to make changes in its original “selections.”

On buying (and recently selling) Apple stock:

Berkshire’s investment in Apple vividly illustrates the power of repurchases. We began buying Apple stock late in 2016 and by early July 2018, owned slightly more than one billion Apple shares (split-adjusted). Saying that, I’m referencing the investment held in Berkshire’s general account and am excluding a very small and separately-managed holding of Apple shares that was subsequently sold. When we finished our purchases in mid-2018, Berkshire’s general account owned 5.2% of Apple. Our cost for that stake was $36 billion. Since then, we have both enjoyed regular dividends, averaging about $775 million annually, and have also – in 2020 – pocketed an additional $11 billion by selling a small portion of our position.

Despite that sale – voila! – Berkshire now owns 5.4% of Apple. That increase was costless to us, coming about because Apple has continuously repurchased its shares, thereby substantially shrinking the number it now has outstanding. But that’s far from all of the good news. Because we also repurchased Berkshire shares during the 2 1⁄2 years, you now indirectly own a full 10% more of Apple’s assets and future earnings than you did in July 2018.

On buying (back) Buffett stock:

After buying back a record $9 billion of its own shares in Q3, Berkshire was unable to find attractively priced investments, and continued the buyback spree repurchasing a similar amount in Q4, bringing its annual buyback for 2020 to a record $24.7 billion. "Berkshire made no sizable acquisitions and operating earnings fell 9% We did, though, increase Berkshire’s per-share intrinsic value by both retaining earnings and repurchasing about 5% of our shares.... The math of repurchases grinds away slowly, but can be powerful over time. The process offers a simple way for investors to own an ever-expanding portion of exceptional businesses. And as a sultry Mae West assured us: “Too much of a good thing can be . . . wonderful.”

And unable to find better investments, Buffett has continued to repurchase its own stock, :

“Berkshire has repurchased more shares since year-end, and is likely to further reduce its share count in the future. That action increased your ownership in all of Berkshire’s businesses by 5.2% without requiring you to so much as touch your wallet.”

Perhaps to be expected, the company's cash - which in Q2 hit a record $146.6 billion, declined by $7.4BN, to a still remarkable $138.9 billion, as Buffett continues to struggle to find investments and as Berkshire throws off cash faster than he can find higher-returning assets to snap up.

And speaking of his inability to find suitable acquisitions, Buffett went on a lengthy tangent about the downfall of conglomerates, and why he doesn't view Berkshire as one of them:

Berkshire is often labeled a conglomerate, a negative term applied to holding companies that own a hodge-podge of unrelated businesses. And, yes, that describes Berkshire – but only in part. To understand how and why we differ from the prototype conglomerate, let’s review a little history.

Over time, conglomerates have generally limited themselves to buying businesses in their entirety. That strategy, however, came with two major problems. One was unsolvable: Most of the truly great businesses had no interest in having anyone take them over.

Consequently, deal-hungry conglomerateurs had to focus on so-so companies that lacked important and durable competitive strengths. That was not a great pond in which to fish.

Beyond that, as conglomerateurs dipped into this universe of mediocre businesses, they often found themselves required to pay staggering “control” premiums to snare their quarry. Aspiring conglomerateurs knew the answer to this “overpayment” problem: They simply needed to manufacture a vastly overvalued stock of their own that could be used as a “currency” for pricey acquisitions. (“I’ll pay you $10,000 for your dog by giving you two of my $5,000 cats.”)

Often, the tools for fostering the overvaluation of a conglomerate’s stock involved promotional techniques and “imaginative” accounting maneuvers that were, at best, deceptive and that sometimes crossed the line into fraud. When these tricks were “successful,” the conglomerate pushed its own stock to, say, 3x its business value in order to offer the target 2x its value.

Investing illusions can continue for a surprisingly long time. Wall Street loves the fees that deal-making generates, and the press loves the stories that colorful promoters provide. At a point, also, the soaring price of a promoted stock can itself become the “proof” that an illusion is reality.

Eventually, of course, the party ends, and many business “emperors” are found to have no clothes. Financial history is replete with the names of famous conglomerateurs who were initially lionized as business geniuses by journalists, analysts and investment bankers, but whose creations ended up as business junkyards.

Conglomerates earned their terrible reputation

After his recent dismal performance, one wonders how soon until one other such crony capitalist "emperor" will be found to have been naked all along.

Finally, in terms of actual results, the company reported Q4 operating income of $5.02 billion, up 14% from $4.42 billion Y/Y, with insurance underwriting resulting in an operating loss of $299 million, down -65% Y/Y. As Bloomberg notes, swings in Berkshire’s massive $281.2 billion stock portfolio (which showed a 5.1% stake in Japanese trading conglomerate Itochu Corp)...

... feed into the company’s net income because of an accounting technicality. That drove net income up 23% to $35.8 billion in the fourth quarter from a year earlier. After another disappointing year, Berkshire’s Class A shares gained roughly 2.4% last year, falling short of the 16% increase in the S&P 500, and less than 1/100th the 306% return of bitcoin in 2020.

As Bloomberg notes, Buffett only briefly touched on one of the largest questions looming over Berkshire - how long he might stay at the helm. He once again referenced a favorite CEO, Mrs. Blumkin, who founded Nebraska Furniture Mart. She worked until she was 103 - “a ridiculously premature retirement age as judged by Charlie and me,” Buffett wrote, referring to Charlie Munger.

And speaking of Munger, Buffett's letter comes days after the Berkshire Vice Chairman sounded off about the "wild speculation" in markets. 

"I hate this luring of people into engaging in speculative orgies. [Robinhood] may call it investing, but that's all bullshit," Munger said on Thursday. 

"It's really just wild speculation, like casino gambling or racetrack betting. There's a long history of destructive capitalism, these trading orgies whooped up by the people who profit from them."

Munger will be on stage with Buffett at the annual meeting to answer questions in May - we're assuming he will continue his spat with Robinhood. 

Read the entire letter below: 

Tyler Durden Sat, 02/27/2021 - 09:45
  • 27 février 2021 à 15:45

Bitcoin Un-'Tether'-ed

Par Tyler Durden
Bitcoin Un-'Tether'-ed

Authored by Tom Luongo via Gold, Goats, 'n Guns blog,

Did you happen to notice the big news in Bitcoin the other day?

It wasn’t the sound of the top forming at $59,000 or Janet Yellen’s comments about its ‘inefficiency.’

It was settling, once and for all, the argument that central planners and oligarchs aren’t omnipotent.

The State of New York’s pathetic slap on the wrist of Tether marked the moment Bitcoin joined the ranks of the ‘Too Big to Fail.’

Somewhere Peter Schiff is sad.

This lawsuit was supposed to be the nuclear bomb goldbugs thought would finally blow up bitcoin and return the world to their vision.

Too bad that multi-megaton nuke was more like an M-80 going off in my neighbor’s backyard.

“Tether’s claims that its virtual currency was fully backed by U.S. dollars at all times was a lie,” James said in a statement.

“Bitfinex and Tether recklessly and unlawfully covered-up massive financial losses to keep their scheme going and protect their bottom lines,” she further said, adding:

“These companies obscured the true risk investors faced and were operated by unlicensed and unregulated individuals and entities dealing in the darkest corners of the financial system.”

This is a face-saving statement for the press by NY Attorney General Laetitia James. Because if there really was a Ponzi scheme at the heart of Tether’s business in 2018-19 then she would have gotten them to cough up a helluva lot more than $18.5 million.

If the powers that be could destroy bitcoin at this point they would have pressed further charges against Tether, undermining the structure of the entire bitcoin market which is increasingly becoming a function of Tether liquidity.

But they didn’t.

In fact they gave Tether and Bitfinex the same treatment they gave J.P. Morgan for gold and silver market manipulation and the entire mortgage industry for fraudulently robosigning legal documents.

In other words, ‘We fined some folks.’

Most, if not all of the anti-bitcoin arguments come down to “the government hates it they will ban it.” But what happens when the government admits it can’t?

So while, Murray Rothbard was right, the establishment hates a free market more than anything else, Murray was also right that their is a limit to their power.

This statement is proving prescient for how many in the establishment are reacting to the first truly free market in currencies we have seen in a long time, as #BTC is proving harder to control with unallocated paper derivatives than "freegold" has been.

— Luke Gromen (@LukeGromen) February 25, 2021

Um, someone tell Janet Yellen and Bill Gates running the anti-environment talking point that Bitcoin uses a lot of electricity isn’t working.

It’s the oligarchs’ latest talking point. And it’s pathetic.

Someone tell Laetitia James to get back in there and fight.

Meanwhile Bitfinex and Tether agree to quarterly monitoring of their books as a gesture of “transparency” and add $18.5 million to the failing tax coffers of New York State.

Whatever hinckey stuff they do they will now — like the major primary dealer banks — settle up at the end of the quarter to present the face to meet the regulators that they meet (with apologies to T.S. Eliot).

And, make no mistake, I think Bitfinex and Tether are sketchy as all get out. In fact, I think 95% of the entire crypto market is sketchy.

But, that doesn’t make it unreal or becoming something unstoppable. Because it doesn’t matter what purists want. The market, in the aggregate, is smarter than any one person.

And the market wants what bitcoin and Tether are selling… right now.

It may want something different in the future. The market is nothing if not fickle…. and gods bless it for this.

Which brings me to why this lawsuit is so important. There was a recent uptick in anti-tether noise out there, doomsdaying the latest bitcoin rally.

This article “The Bit Short: Inside Crypto’s Doomsday Machine (very long, and reasonably well researched) from January outlines a strong argument as to why Tether could be a scam.

And I want to point out how well-timed it was, published January 14th, coinciding with the first attempt to derail bitcoin’s rise.

He goes into a lot about Tether, staking his entire argument on their responding to this lawsuit as the proximate cause for their cashing out of their scam.

He does a forensic analysis of the Bahamanian banking system, lays out the mechanisms for startup company scam, the whole nine yards. Kudos to the writer, it’s a good tale you should read it.

He also didn’t sign his work, but, you know, details.

That doesn’t mean however:

  1. He’s right.

  2. Things can’t evolve or change.

  3. Tether isn’t performing a valuable service

  4. Demand for bitcoin liquidity outstrips available supply

In the end, this is just another great piece of writing that misses the bigger picture.

The market decides what it wants not you or me.

In short, it doesn’t mean Tether was intended to be a scam but could simply have been, like bitcoin itself, a service so needed by the market that demand for it far outstripped its ability to perform within its operating parameters, i.e. 100% dollar reserves 100% of the time.

That’s the main reason why Laetitia James settled out of court and Tether admitted no wrongdoing. The market was simply moving faster than the money pouring in and out of the crypto-space could clear and they shuffled some money around to, in the end, protect their clients and their business.

Here’s an aphorism which bears on this story, “It’s easier to beg for forgiveness than permission.”

$18.5 million and a negative headline is cheap to protect what is now a $35 billion business.

But, the premise of this article has been a standard refrain in the crypto-skeptic land for four years.

It boils down to, “You all know Tether’s a scam, right!?”

It’s a glaring bit of editorial bias. Because many of the arguments that people make about bitcoin and cryptocurrencies in general are built on the premise that everyone holding them wants to at some point “cash out and get back to dollars.”

Stupid is as stupid tweets.

Gold is blowing through support and Peter is shitposting about GBTC?

There's a dollar short squeeze happening or didn't you notice?

— Tom Luongo (@TFL1728) February 26, 2021

But what does the market look like when a critical mass of people make a psychological shift valuing their portfolios not in dollars but bitcoin?

One could argue we’re in the process of finding out the answer to that right now.

I’ve talked about the potential for this shift previously herehere and here for anyone who still isn’t listening.

And that scares the living daylights out of everyone who makes their money outside of the dollar, bull or bear, but especially the bears.

Because for a generation now those bears were sold by people like Peter Schiff and the writer of this article which was disseminated far and wide in gold circles that gold was the only alternative to the dollar.

But it’s not and they are bitter about it.

They created what I now call “Gold-Only Bugs.”

For four years I’ve listened patiently to every argument against bitcoin and tether. They aren’t completely wrong. But they do, I think, overstate the risks.

I continue to hedge my bets against monetary insanity. I’m one of the few people in this space that advocates de-risking across all cash-equivalent asset classes.

Smart enough to know he doesn't know the future with any certainty. I own and advocate Gold,Silver, Bitcoin, altcoins and cash. It's the only rational position to take.

— Tom Luongo (@TFL1728) February 25, 2021

With this lawsuit and the whole Tether Time Bomb removed from the market bitcoin is now part of the big time. It’s a multi-trillion industry. Those don’t just dry up and blow away without damaging the very people trying to defend against it.

When you owe the bank a thousand dollars it’s your problem. When you owe the bank a trillion dollars it’s their problem Bitcoin is a variation on that idea.

Blackrock’s buying bitcoin, folks.


Coinbase is filing for an IPO. It’ll be at a valuation higher than Facebook’s.

In fact, it’ll be the biggest IPO in U.S. market history.

The bookrunning fees alone will make Goldman’s or Morgan’s next quarter a blowout.

They said the internet was a fad, too.

But yet you still think a troika of Participatory Medal Winners like Janet Yellen, Christine Lagarde and Jerome Powell are going to stop this train?

You think they can just wave their magic wands and make it all go poofta?

Why would Tether and Bitfinex run away with all the money now when they just won? Bigly.

They can pull massive yield in DeFi on their USDT and bitcoin. But they’re going to give up their first-mover advantage in the immensely important stablecoin space for a couple of billion which can be seized by any government?

The only central banker with a brain is Powell, as he properly identified the threat to their rule… and it’s not bitcoin.

It’s stablecoins like tether.

Because what is the dollar except a stablecoin backed by the confidence of the debtholders of Nancy Pelosi’s ability to extract wealth from Americans to pay the coupons?

If someone builds a better one than the dollar eventually it’s game over for the debt-based system.

Why would Tether run away with a few billion in depreciating dollars when they can literally bring down the entire monetary system and replace it with their product?

The reality is that the day the dollar becomes irrelevant is the day Tether folds up shop and completes their scam because no one will want dollars and a dollar-pegged stablecoin with dollar reserves will be redundant.

I’m not saying that day is here. No. We’re a long way off from that day.

But this lawsuit settling with such a whimper is a primal scream marking the next phase of the war between central banks and the people.

*  *  *

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Tyler Durden Sat, 02/27/2021 - 09:20
  • 27 février 2021 à 15:20

House Dems Pass Biden’s $1.9 Trillion COVID Relief Package 

Par Tyler Durden
House Dems Pass Biden’s $1.9 Trillion COVID Relief Package 

Around 0200 ET Saturday morning, the Democratic-led House of Representatives passed the second-largest stimulus package of the pandemic that includes a $15 minimum wage hike. 

Lawmakers passed the bill by a thin margin: 219-212, with two Democrats (Reps. Jared Golden (Maine) and Kurt Schrader (Ore.)) joining all Republicans in voting against it. 

2:04:30 a.m. - #HR1319 - On passage Passed by the Yeas and Nays: 219 - 212 (Roll no. 49).

— U.S. House Floor (@HouseFloor) February 27, 2021

The bill's passage comes as COVID-19 deaths top half a million, and more than ten million people have lost their jobs and are battling food and housing insecurities. 

"The bill includes some big-ticket items that would deliver important relief to businesses, workers, and the broader economy. It includes $1,400 stimulus checks for those making up to $75,000, $400 expanded weekly unemployment insurance benefits through August 29, and billions of dollars for arenas such as schools, state and local governments, and restaurants. It also increases Affordable Care Act subsidies for low- and middle-income Americans and expands both the child tax credit and the earned income tax credit," according to VOX

The bill also includes a $15 minimum wage hike, despite a recent Senate parliamentarian's ruling that the minimum wage increase cannot be included in the stimulus package.

Democrats are using budget reconciliation, which allows passage of some legislation with only 51 votes in the Senate, rather than the 60 if the opposition filibusters. The Dems have 51 votes if Vice President Kamala Harris is asked to vote upon a tie-breaking, which means Dems could push Biden's agenda through.

However, the parliamentarian's ruling underscores the bill's fragility as it reaches the Senate - where it only takes one Dem to doom Biden's rescue package. 

Already, centralist Dems, such as Sen. Joe Manchin of West Virginia, have balked at the idea of increasing the minimum wage from $7.25 to $15 an hour. 

Others, such as the more progressive wing of the party, like Vermont independent Bernie Sanders, have stood tall on their support to include the bill's $15 minimum wage increase. 

Bear in mind that Republicans have introduced their versions of bills to increase the minimum wage.

  • Sens. Mitt Romney (R-Utah) and Tom Cotton (R-Ark.) proposed an increase to $10/hour by 2025. This bill, however, contains a provision that would mandate E-Verify for all employers to ensure the rising wages go to "legally authorized workers," which likely would not get any Democratic support.
  • Sen. Josh Hawley (R-Mo.) introduced an alternative to the Democrats' proposal that would use federal dollars to increase low-earning workers' income. One foreseeable problem: the subsidy would disproportionally benefit those in states that have kept their minimum wages low.

But, of course, Bernie and his progressive buddies won't stand for anything less than $15!

Some economists are warning that the legislation is too ambitious and may spark unwanted inflation. 

JPM's chief economist Michael Feroli warned Biden's stimulus package would not ease overheating concerns. 

In response to this MMT madness in Washington - treasury yields violently rose this past week ahead of House's stimulus vote. More money flooding the economy sets off alarm bells on inflation risk, conjuring dark images in the minds of traders of the 1970s when central banks struggled to contain rising prices, sort of like what's happening today (read: Food Inflation Is The Best Predictor Of Bond Yields)

As readers found out last week, February saw a massive shift in the market's perception of the Fed's rate-hike trajectory... now pricing in more than 4 rate-hikes between 2022 and 2024...

Laying it all out for readers, additional rounds of stimulus could stoke inflationary fears that would continue to depress tech stocks. 

This is bad news for much of the Robinhood crowd who has yet to trade a rising rate environment. 

So the question we ask: How long until the Fed intervenes to suppress rates? After all, other central banks this week freaked out with announcements of increased bond purchases to contain their sovereign yields from rising higher. 

White House press secretary Jen Psaki and White House Chief of Staff Ron Klain have explicitly said that the Biden admin would not go against parliamentarian and use Harris. But given that Speaker of the US House of Representatives Nacy Pelosi went ahead with the bill, who knows...

Given Pelosi's actions, this has the optics of a hot potato pass off to the senate... So Pelosi can remove herself from any blame should things not proceed smoothly. Now it is Senate Republicans that will be blamed (by the mainstream media) for Americans not getting their stimulus checks. 

Tyler Durden Sat, 02/27/2021 - 08:50
  • 27 février 2021 à 14:50

ISIS Bride Shamima Begum Not Allowed To Return To UK: Top Court

Par Tyler Durden
ISIS Bride Shamima Begum Not Allowed To Return To UK: Top Court

Authored by Alexander Zhang via The Epoch Times,

The UK Supreme Court ruled on Friday that Shamima Begum, who left the UK for Syria to join the ISIS terrorist group as a teenager, is not allowed to return and fight her citizenship case because she poses a security risk.

Begum, who has dual British-Bangladeshi citizenship, travelled to Syria at the age of 15, along with some other classmates, to join the so-called ISIS caliphate.

As the caliphate was being whittled down to its last survivors by U.S. and allied forces, she surfaced at a refugee camp in Syria, where she caught the interest of Western journalists.

A still taken from CCTV issued by the Metropolitan Police in London on Feb. 23, 2015, of 15-year-old Amira Abase (L), Kadiza Sultana, 16 (centre), and Shamima Begum, 15, going through Gatwick Airport, south of London, before they caught their flight to Turkey on Feb. 17, 2015. (AP Photo/Metropolitan Police)

Her citizenship was revoked in 2019 by the Home Secretary following a series of interviews she gave from the refugee camp in which she expressed little remorse but said she wanted to return to the UK.

Her family appealed against the decision. Their legal team said that Begum must be allowed to return to the UK so that she can give evidence in person. The government resisted in the courts.

In July 2020, the Court of Appeal ruled that “the only way in which she can have a fair and effective appeal … is to be permitted to come into the United Kingdom to pursue her appeal.”

But the Supreme Court said on Friday that the five justices who heard the case “unanimously allows the Secretary of State’s appeals and dismisses Ms Begum’s cross-appeal,” meaning Begum will not be allowed back into the UK to fight her citizenship case, though she may continue to pursue the case elsewhere.

The Supreme Court said that the Court of Appeal was mistaken in believing that “when an individual’s right to have a fair hearing of an appeal came into conflict with the requirements of national security, her right to a fair hearing must prevail.”

The top court said “the right to a fair hearing does not trump all other considerations, such as the safety of the public. If a vital public interest makes it impossible for a case to be fairly heard, then the courts cannot ordinarily hear it.”

The ruling said Begum’s legal appeal should be stayed until she is “in a position to play an effective part in it without the safety of the public being compromised.”

Prior to the ruling, Will Geddes, CEO of International Corporate Protection Group and a counter-terrorism expert, told NTD that the case is “quite extraordinary” because its result “could have very serious repercussions in terms of other British nationals who have been operating and colluding with terrorist groups overseas, over and beyond ISIS, permitting them a pathway and access to return to the United Kingdom.”

The risks that these returning jihadis and terrorists potentially present could be potentially quite extensive. It will also require a considerable amount of resource by the security services, even if they have turned their back on those previous ideals,” he said in an interview on Thursday.

But some senior Conservative MPs have argued that Britain should not “wash its hands” of the 40 British citizens detained in camps for ISIS personnel in northern Syria.

According to The Telegraph, in a letter Thursday to Foreign Secretary Dominic Raab and Home Secretary Priti Patel, Andrew Mitchell, David Davis, Tom Tugendhat, and Tobias Ellwood warned that failure to take responsibility for them would “necessarily create even more security risks for the UK in the future.”

Tyler Durden Sat, 02/27/2021 - 08:10
  • 27 février 2021 à 14:10

These Are The 50 Richest Women In The World In 2021

Par Tyler Durden
These Are The 50 Richest Women In The World In 2021

According to a recent census by Wealth-X, 11.9% of global billionaires are women. Even at such a minority share, Visual Capitalist's Iman Ghosh notes that this group still holds massive amounts of wealth.

Using a real-time list of billionaires from Forbes, we examine the net worth of the 50 richest women in the world and which country they’re from.

Where are the World’s Richest Women?

The richest woman in the world, Francoise Bettencourt Meyers and family own 33% of stock in L’Oréal S.A., a French personal care brand. She is also the granddaughter of its founder.

In April 2019, L’Oréal and the Bettencourt Meyers family pledged $226 million (€200 million) towards the repair of the Notre Dame cathedral after its devastating fire.

Following closely behind is Alice Walton of the Walmart empire—also the world’s richest family. Together with her brothers, they own over 50% of the company’s shares. That’s a pretty tidy sum, considering Walmart raked in $524 billion in revenues in their 2020 fiscal year.

Other family ties among the richest women in the world include Jacqueline Mars and her four granddaughters, heiresses to a slice of the Mars Inc. fortune in candy and pet food—and all of them make this list.

MacKenzie Scott, ranked #3 on the list, was heavily involved in the early days of turning Amazon into an e-commerce behemoth. She was involved in areas from bookkeeping and accounts to negotiating the company’s first freight contract. Her high-profile divorce from Jeff Bezos captured the headlines, notably because she gained control over 4% of Amazon’s outstanding shares.

The total value of these shares? An eye-watering $38.3 billion—propelling her to the status of one of America’s richest people.

However, MacKenzie Scott has more altruistic ventures in mind for this wealth. In 2020, she gave away $5.8 billion towards causes such as climate change and racial equality in just four months, and is a signatory on the Giving Pledge.

[Scott’s near $6 billion donation has] to be one of the biggest annual distributions by a living individual.

- Melissa Berman, CEO of Rockefeller Philanthropy Advisors

Looking towards the East, Yang Huiyan became the richest woman in Asia after inheriting 70% of shares in the property development company Country Garden Holdings. The company went public in 2007, raising $1.6 billion in its IPO—an amount comparable to Google’s IPO in 2004.

To aid frontline health workers during the pandemic, Country Garden Holdings set up robotic, automated buffet stations to safely serve medical staff in Wuhan, China.

Giving Generously

While the 50 richest women in the world have certainly made progress, the overall tier of billionaires is still very much a boys’ club. One thing that also factors into this could be the way this wealth is spent.

As many female billionaires inherited their wealth, a large share are more inclined to contribute to charitable causes where they can use their money to make an impact. What percentage of billionaires by gender have contributed at least $1 million in donations over the past five years?

Meanwhile, male billionaires are more likely to donate to charity if they built the wealth themselves—and many companies that fall into this category certainly stepped up during the early days of the COVID-19 crisis.

Tyler Durden Sat, 02/27/2021 - 07:35
  • 27 février 2021 à 13:35

2,600 Homes Evacuated After Unexploded WW2 Bomb Found In Exeter 

Par Tyler Durden
2,600 Homes Evacuated After Unexploded WW2 Bomb Found In Exeter 

At a construction site in Exeter, a city on the River Exe in southwest England, an unexploded World War Two bomb was found.

On Saturday morning, Devon & Cornwall Police released a statement that read 2,600 households have been "evacuated in preparation for the examination of a possible unexploded World War Two device, which was located at a site on Glenthorne Road, Exeter, yesterday, Friday 26 February." 

The 2.5m (8ft) by 70cm (27in) bomb was found by construction workers on a private worksite west of the University of Exeter campus.

Devon & Cornwall Police said, "the Royal Navy bomb disposal team who worked through the night to establish a walled mitigation structure." 

Examination and detonation of the bomb are expected to be conducted by the Army. 

Devon & Cornwall Police tweeted a map of where the bomb was found and the evacuation area. 

In a series of tweets, the University of Exeter said students were evacuated from the area on Friday. 

EMERGENCY MESSAGE: Building evacuation on Streatham Campus
Earlier today builders on private land next to the University uncovered an unexploded bomb.
Police are coordinating and there is no indication that this causes imminent danger, but we need to take immediate action.

— University of Exeter (@UniofExeter) February 26, 2021

The discovery comes as no surprise considering the Germans in World War Two bombarded the city. 

With the area around the bomb site locked down and the military working to defuse the device - additional updates on the situation should follow. 

Tyler Durden Sat, 02/27/2021 - 07:18
  • 27 février 2021 à 13:18

Merkel: EU Leaders "Have All Agreed That We Need Vaccine Passports"

Par Tyler Durden
Merkel: EU Leaders "Have All Agreed That We Need Vaccine Passports"

Authored by Steve Watson via Summit News,

After the European Commission convened to discuss the potential of so called ‘vaccine passports’ Thursday, German Chancellor Angela Merkel told reporters that “We have all agreed that we need vaccine certificates.”

Bloomberg reports that Merkel added “In the future, it will certainly be good to have such a certificate but that will not mean that only those who have such a passport will be able to travel; about that, no political decisions have been made yet.”

The German leader also stated:

“This will make travelling within the EU possible and could pave the way for further travel from third countries into the EU,” suggesting that it will take three months to implement a vaccine passport system.

The report also notes that Commission President Ursula von der Leyen urged member states to make haste in agreeing a Europe wide system before Big Tech gets there first.

Von der Leyen reportedly cited Israel’s ‘Green Pass’ system, which the country is using as a domestic internal document, denying entry for the unvaccinated to public spaces including sports events, restaurants and hotels.

While admitting that it is “unclear whether you can transmit the disease even if you are vaccinated,” the Commission leader stated “It is important to have a European solution because otherwise others will go into this vacuum.”

“Google and Apple are already offering solutions to the WHO [World Health Organization]. And this is sensitive information so we want to be very clear here that we offer a European solution,” Von der Leyen emphasised.

Alex Patelis, chief economic adviser to Greek Prime Minister Kyriakos Mitsotakis, noted “If we as European Union don’t provide a solution, somebody else will, whether it’s going to be the U.S. big tech companies or somebody else, the solution will be provided.”

“Let’s get the infrastructure ready,” Patelis added.

French President Emmanuel Macron has expressed skepticism over the notion of vaccine passports, but stated:

“We’ll have, in the end, a harmonious EU approach,” adding “It’s obvious because there is no other choice.”

While there have been scant reports of Apple or Google developing vaccine passports, and the WHO has expressed caution on the issue, there are plenty of other schemes under development and being rolled out, as we have repeatedly highlighted.

Tyler Durden Sat, 02/27/2021 - 07:00
  • 27 février 2021 à 13:00

Buchanan: Trump, Once & Future King?

Par Tyler Durden
Buchanan: Trump, Once & Future King?

Authored by Pat Buchanan via,

“I don’t know if he’ll run in 2024 or not. But if he does, I’m pretty sure he will win the nomination.”

So says Mitt Romney, the sole Republican senator to have voted twice to convict President Donald J. Trump of impeachable acts.

But is it possible Trump could win the nomination in 2024?

What does history teach us about Republican presidents who, after losing the White House, come back to win it again?

Well, to be frank, there is no such history.

Consider. Four Republican presidents in the 20th century were defeated while seeking a second term. None was nominated again.

William Howard Taft lost the White House to Woodrow Wilson in 1912, and even ran behind the third-party “Bull Moose” candidate, ex-President Theodore Roosevelt. Taft never ran again but went on to serve as chief justice of the United States.

Ex-President Teddy Roosevelt was considering running again in 1920 but died at 60 in January of 1919 at Sagamore Hill.

After President Herbert Hoover lost to FDR in 1932, he never ran again.

Gerald Ford, serving out Nixon’s second term, lost to Jimmy Carter in 1976 and packed it in for good, as did President Carter after losing to Ronald Regan in 1980.

George H. W. Bush lost the White House in 1992 and retired from electoral politics, never to run again.

As for Trump running in 2024 and winning the GOP nomination, he does hold high cards no other ex-president held, except perhaps Roosevelt.

Trump has a vast and loyal following. Currently three-fourths of all Republicans see him as their leader. He won 74 million votes, the highest total ever for a sitting president or a losing presidential candidate.

Their loyalty is traceable to what Trump achieved, whom and how he fought, and the new issues he introduced and has become indelibly associated. Foremost among these is his struggle to secure the Southern border against endless illegal migrant crossings.

Unrestricted immigration from the South, the Third Worldization of America, is the true existential threat “climate change” purports to be.

Trump also succeeded in enacting the traditional GOP platform of low taxes and deregulation, producing record-low unemployment — before the pandemic hit in March 2020.

His record of elevating strict constructionists, constitutionalists and conservatives to the federal courts, and three Supreme Court seats, is unrivaled in the history of the modern Republican Party.

Trump also forged a bond with Middle America by taking on a media whose treatment of him was remorselessly hateful and hostile. “We love him for the enemies he has made,” it was said of Grover Cleveland.

He brought a new and unique agenda to the GOP.

He replaced a free trade globalist ideology with nationalism. He set out to rebuild America’s depleted manufacturing base and restore her economic independence. Under Trump, the slogan “America First” came to represent a new foreign policy where rich and prosperous allies carried more of the burden of their own and the common defense.

He wanted Americans to do their nation-building here in the USA.

While Beltway Russophobes prevented Trump from achieving the rapprochement he wanted, and he failed to extricate us from the forever wars of the Middle East, he did drawdown U.S. forces in Syria, Iraq and Afghanistan, and keep us out of an all-out war with Iran.

There is thus a specific Trumpian agenda, with which he is alone associated, that is becoming the issues agenda of the conservative movement and the party base, if not the party elites.

Yet, the drawbacks to a Trump nomination remain major.

He did, after all, lose in 2020. And he has been damaged by the months-long battle since to prove that Biden was the beneficiary of a stolen election. The Jan. 6 assault on the Capitol by MAGA militants was blamed on Trump and became the article of his second impeachment where every Democratic senator and six Republicans voted to convict him. And even some of those who voted to acquit, like Minority Leader Mitch McConnell, declared him guilty of inciting the mob. Moreover, Trump faces a blizzard of legal challenges and charges that will damage his reputation, his businesses and him, personally.

In 2024, Trump will turn 78, the age Joe Biden is today. And between now and 2024, there is sure to be considerable attrition in support among the 74 million who voted for Trump.

But if Romney is right and Trump has the kind of strength that could make him the nominee in 2024, that strength will surely be sufficient to veto or sink any potential nominee who does not have the former president’s blessing.

And, from seeing both candidates of 2020 up close in recent weeks and months, does not Trump appear more likely to be the Republican leader of his party than does slow-moving “Sleepy Joe” look like the Democratic nominee 44 months from now?

Tyler Durden Fri, 02/26/2021 - 23:40
  • 27 février 2021 à 05:40

COVID Outbreak Hits Two Navy Warships Deployed In Middle East

Par Tyler Durden
COVID Outbreak Hits Two Navy Warships Deployed In Middle East

In what seems a repeat of the USS Theodore Roosevelt coronavirus outbreak saga of last Spring which led to the sacking of its commander who blew the whistle on Pentagon mishandling, and the resignation of no less than the Secretary of the Navy, there are now two US warships that have been struck with COVID-19 outbreaks while patrolling Middle East regional waters.

Both are now said to be returning to port in Bahrain to handle the emerging crisis, according to the Associated Press on Friday. "A dozen troops aboard the USS San Diego, an amphibious transport dock, tested positive for COVID-19, said Cmdr. Rebecca Rebarich, a spokeswoman for the Bahrain-based 5th Fleet," AP reports.

Additionally, the guided-missile cruiser USS Philippine Sea which has also been deployed to the gulf and Indian Ocean regions has "confirmed several cases of COVID-19," according to the 5th Fleet's statement. This out of an estimated 380 sailors on board. The San Diego is the larger of the two, with almost 600 sailors and Marines. 

USS Philippine Sea in the foreground, via US Navy/Wikimedia

"All positive cases have been isolated on board, and the (ships) remains in a restricted COVID bubble,” Cmdr. Rebarich said. "The port visit and medical support have been coordinated with the host nation government and Bahrain Ministry of Health."

Through much of the summer following the major USS Theodore Roosevelt carrier outbreak crisis which saw over 1,000 sailors test positive - including one death - a number of naval ships opted for extended stints at sea - avoiding port calls in order to maintain natural isolation from potential exposure on land. 

However, there's since been a sense of 'normal' deployment protocols resuming, though with heightened hygiene and distancing measures, and what the Navy has called "aggressive mitigation" efforts to combat the virus.

Meanwhile, earlier this month the Roosevelt itself was actually back in pandemic related news after at least three sailors tested positive for COVID-19. The small cluster of infections was uncovered during 'random' surveillance testing for the virus. It remains that the majority of cases in the Navy are asymptomatic, which why the military has been so regularly conducting large scale monitoring tests.

Tyler Durden Fri, 02/26/2021 - 23:20
  • 27 février 2021 à 05:20

China Emits More Carbon In 2 Weeks Than Australia Does In One Year: Think Tank

Par Tyler Durden
China Emits More Carbon In 2 Weeks Than Australia Does In One Year: Think Tank

Authored by Henry Jom via The Epoch Times,

China emits more carbon dioxide in 16 days than Australia does in one year, according to new research published by a free-market think tank.

Australia’s net-zero emissions target would therefore be cancelled out by China in just two weeks, the Institute of Public Affairs (IPA) said in a press release on Wednesday.

According to the report, China operates 57 times as many coal-fired power stations as Australia. This figure is set to increase with China currently constructing 92 coal-fired power stations.

The report also added that while Australia’s carbon emissions per capita have declined by 15.4 percent since 2004, China’s emissions per capita over the same period have increased by 83.5 percent.

Globally, the report identified that Australia’s share of global carbon emissions declined from 1.3 percent in 2009 to 1.1 percent in 2019.

“Despite Australia’s negligible share of global emissions, under the Paris Agreement, Australians are subject to the deepest per capita emissions cuts in the developed world,” the report added.

Meanwhile, Prime Minister Scott Morrison is pursuing “low emissions technologies” instead of committing Australia to net-zero emissions, with New South Wales and Western Australia referring to net-zero it as an “aspirational” target, reported Herald Sun.

However, Federal Labor Opposition leader Anthony Albanese looks set to committing his party to achieve net-zero by 2050, while Independent Member for Warringah Zali Steggall plan to introduce a Climate Change Bill to parliament in March.

Cian Hussey, Research Fellow at the IPA, said calls for Australia to adopt a net-zero emissions target would “ignore the significant economic, social, and humanitarian costs which would inevitably be the result of such a target.”

“It is reckless and futile for the political class to impose on Australians further severe cuts to emissions which costs jobs and livelihoods, while China—the world’s largest emitter—continues to rapidly increase its emissions without consequence,” said Hussey.

Earlier research by the IPA found that up to 653,600 jobs would be at “direct risk” if a net-zero carbon emissions target were put in place—particularly in the agriculture, heavy manufacturing, and coal mining industries.

While some Nationals have called for exemptions for the agricultural sector, Independent Zail Steggall said keeping the sector out of the zero-emissions target would mean the sector risked being charged carbon tariffs from other countries.

Nationals backbencher Matt Canavan has warned the 2050 net-zero emissions target is the “wrong priority” for the Federal government, reported Sky News.

“There’s way too much focus on what might or might not happen in 30 years time rather than dealing with the challenges we face right now,” Canavan said.

“When I think about what the biggest challenge for my kids is going to be in their generation, I think it’s the rising aggression of the Chinese Communist Party in our region. Not carbon neutrality by 2050.”

Tyler Durden Fri, 02/26/2021 - 23:00
  • 27 février 2021 à 05:00

"Drunk" Roomba Robots Aimlessly Roam Homes Amid Major Software Glitch   

Par Tyler Durden
"Drunk" Roomba Robots Aimlessly Roam Homes Amid Major Software Glitch   

Here's an instance where smart internet of things (IoT) automation devices are miserably failing. Users on Reddit and other forms of social media are reporting their iRobot Roomba vacuums are experiencing navigation issues, with some users comparing their expensive robo-vaccums' behavior to that of a "drunk."

"iRobot what's up with the 3.12.8 release? My tickets were closed and I wasn't rolled back. These robots looks drunk since the update. Mounting complaints in the forums continue. Some folks who were rolled back got rolled forward and the issues came back. HELP!," tweeted Anthony Virtuoso

YouTuber Garrett McGrath uploaded a video titled "Drunk roomba, useless firmware" that shows the robo-vacuum wandering around the room, performing useless tasks. At the end of the video, the robot fails to dock at its charging station. 

"irobot published a firmware recently that may as well have turned these things into paperweights. the 'fix' is to delete all your maps, reseat the robot a bunch of times, factory reset it after that, reboot it a few more times, and start over entirely with pairing it again. Just to the machine work for two weeks then return to this state, "McGratg explained in the video's description.

The Verge reports that iRobot's latest software updates for i7 and s9 Roomba models have faulty "firmware updates have been causing navigation issues." According to that report, new software updates could be rolled out "over the next several weeks." 

One Reddit user records a timelapse video of their i7 failing to dock. 

These robots cost anywhere from $600 to $900 per unit - these domestic help robo-cleaners under the IoT umbrella are supposed to improve our lives though that doesn't appear to be the case here. 

Tyler Durden Fri, 02/26/2021 - 22:40
  • 27 février 2021 à 04:40

Facebook Algorithm Accuses 81-Year-Old Grandmother Of "Hate Speech" Over Knitted-Pigs Comment

Par Tyler Durden
Facebook Algorithm Accuses 81-Year-Old Grandmother Of "Hate Speech" Over Knitted-Pigs Comment

Authored by Paul Jospeh Watson via Summit News,

Facebook’s algorithm flagged an 81-year-old grandmother’s comments about knitted pigs as an example of “hate speech” and threatened her with a permanent ban.

Yes, really.

After losing her husband last year, Rita Rich-Mulcahy, a retired teacher who lives in Australia, created the Facebook page to share with the world her love of knitting and raise money for The Smith Family charity, which helps disadvantaged children.

After posting a picture of her own knitted pigs, Rich-Mulcahy referred to them as “white pigs” and “high-viz pigs,” resulting in the threat to terminate her account over “hate speech.”

“It may seem a small thing to most people, but to someone who had never even had an overdue library book, being charged with using hate speech was frightening,” said Rich-Mulcahy.

Facebook issued a statement asserting that its automated system flagging the comments was a “mistake” that its AI “sometimes” makes.

The story once again illustrates how Facebook’s censorship algorithm, which gets stricter almost by the day as a result of relentless mainstream media hysteria, is completely broken.

*  *  *

In the age of mass Silicon Valley censorship It is crucial that we stay in touch. I need you to sign up for my free newsletter here. Support my sponsor – Turbo Force – a supercharged boost of clean energy without the comedown. Also, I urgently need your financial support here.

Tyler Durden Fri, 02/26/2021 - 22:20
  • 27 février 2021 à 04:20

Huawei Plans New Electric Car As US Sanctions Crush Cellphone Business

Par Tyler Durden
Huawei Plans New Electric Car As US Sanctions Crush Cellphone Business

If you thought the hype surrounding electric vehicles and the hunt for a "Tesla killer" had ended with the exposure of the Nikola fraud by short-sellers last year, well, that couldn't be further from the truth.

And not only because Saudi-backed Lucid motors is getting ready to go public via a deal with a SPAC put together by investment banker Michael Klein. As the CCP pushes for more electric vehicles to be sold in China, more domestic companies are entering the fray.

One example is Huawei, which - according to Reuters - is planning to make electric vehicles under its own brand and could launch some models this year as it pivots away from making smartphones after the Trump Administration cut off access to critical American components.

Since building cars from scratch is no easy task, Huawei is instead is in talks with state-owned Changan Automobile and other automakers to use their car plants to make its Huawei branded electric vehicles, according to Reuters.

Huawei is also in talks with another Chinese firm: BAIC Group’s BluePark New Energy Technology. Like Foxconn's deal with Lucid, BluePark would be responsible for mass producing the cars presumably designed by Huawei.

According to Reuters, the plan heralds "a potentially major shift in direction for Huawei after nearly two-years of US sanctions that have cut its access to key supply chains, forcing it to sell a part of its smartphone business to keep the brand alive.

The Trump Administration targeted Huawei over concerns that western countries using its technology and products in their 5G networks would give the CCP unprecedented access to private and sensitive information belonging to foreign governments. A spokesman for Huawei warned that while the company doesn't presently manufacture cars, it is aiming to provide "digital car-oriented and new-added components".

"Huawei is not a car manufacturer. However through ICT (information and communications technology), we aim to be a digital car-oriented and new-added components provider, enabling car OEMs (original equipment manufacturers) to build better vehicles.”

The company's EVs will reportedly target mass-market consumers, while "foreign" electric cars like those produced by Tesla and other foreign automakers (like Ford, which has partnered with a domestic Chinese firm to make electric cars for the Chinese market) presumably will target wealthier Chinese consumers. It's a divide that reflects the Chinese smartphone market, where domestic phones from Huawei and Xiaomi are seen as more pedestrian than Apple products purchased in the country.

The prospects for growth in China's EV market are high: Sales of new energy vehicles (NEVs), including pure battery electric vehicles as well as plug-in hybrid and hydrogen fuel cell vehicles, are expected to make up 20% of China’s overall annual auto sales by 2025. And inndustry forecasts put China’s NEV sales at 1.8MM units this year, up from about 1.3 million in 2020.

And Huawei isn't alone. Its ambitious plans to make its own cars are allowing it to join a raft of Asian tech companies that have made similar announcements in recent months, including Baidu Inc and Foxconn.

Huawei was awarded at least four patents related to EVs this week.

Of course, the Huawei electric car is only one of several new EV projects that are still in the early stages. For example, Fisker, the one-time Tesla rival, has reportedly partnered with Foxconn to build electric cars as it clearly sees better business prospects in China.

Tyler Durden Fri, 02/26/2021 - 22:00
  • 27 février 2021 à 04:00

Biden Gun Control Plan Would "Criminalize" Up To 105 Million People: Gun-Rights Group

Par Tyler Durden
Biden Gun Control Plan Would "Criminalize" Up To 105 Million People: Gun-Rights Group

Authored by Jack Cardillo via The Epoch Times,

A gun-rights organization said that President Joe Biden’s gun control proposal would potentially make about 105 million law-abiding gun owners into criminals.

“While we can agree that there are several ‘common sense’ and long overdue changes needed to our nation’s gun laws, we firmly believe that the path forward should be focused on supporting and protecting responsible, law-abiding Americans - not criminalizing and punishing them,” the U.S. Concealed Carry Association said in a letter to Biden this week.

The group - which, according to the group’s website, has about 556,000 members - said the president’s push for gun control on the anniversary of the Parkland, Florida mass shooting was needless.

“The U.S. Concealed Carry Association exists to help responsible Americans avoid danger, save lives, and keep their families safe, and we believe that our elected leaders in Washington have an incredible obligation to pursue these same goals,” the group added.

The group noted that in 2020, a significant number of people purchased firearms in the midst of historic riots and the COVID-19 pandemic.

The FBI stated last month that it processed a record 39.7 million firearm background checks in 2020, which bested the previous high of 10 million. Reports said that as many as 8.5 million purchased their first firearm in 2020, according to the National Shooting Sports Foundation. Meanwhile, a number of gun and ammunition manufacturers reported shortages amid the surge in demand.

Biden earlier this month said that he would push Congress to enact more gun control measures, including allowing gun manufacturers to face lawsuits, banning “assault weapons,” and placing bans on high-capacity magazines. His pick for Attorney General, Merrick Garland, told lawmakers on Monday that he would support the White House’s stance on gun control.

“This Administration will not wait for the next mass shooting to heed that call. We will take action to end our epidemic of gun violence and make our schools and communities safer. Today, I am calling on Congress to enact commonsense gun law reforms, including requiring background checks on all gun sales, banning assault weapons and high-capacity magazines, and eliminating immunity for gun manufacturers who knowingly put weapons of war on our streets,” Biden said earlier this month.

Pro-Second Amendment groups have noted that the term “assault weapon” has a nebulous meaning, with some saying that it is a made-up term that was invented by the anti-gun lobby in the 1980s. “Assault rifle” is a term sometimes used by the military to define a rifle that has select-fire capabilities, or the ability to switch between semi-automatic or fully automatic. For example, the much-derided AR-15 doesn’t have select-fire capability and only operates as a semi-automatic rifle.

The U.S. Concealed Carry Association further added that “record numbers of Americans have been purchasing firearms to keep themselves and their loved ones safe,” adding that “women and minorities are now leading the way as the fastest-growing groups of concealed carry permit holders in the country.”

White House officials, furthermore, have said Biden would take on the largest gun-rights group, the National Rifle Association (NRA).

“But I will say that the president is somebody, throughout his career, who has advocated for smart gun, smart gun safety measures,” press secretary Jen Psaki said earlier this month. “He is not afraid of standing up to the NRA – he has done it multiple times.”

The letter was first obtained by the Washington Examiner. The Epoch Times has reached out to the White House for comment.

Tyler Durden Fri, 02/26/2021 - 21:40
  • 27 février 2021 à 03:40

Artificial Intelligence Takes Over Drive-Thru Orders At This Fast-Food Restaurant

Par Tyler Durden
Artificial Intelligence Takes Over Drive-Thru Orders At This Fast-Food Restaurant

Today, the warning is that no low-skilled job is safe from being displaced by automation and artificial intelligence. For example, humans taking orders at drive-thru lines at fast-food restaurants are being replaced with an automated system.

Lee's Famous Recipe Chicken in Englewood, Ohio, beginning this week, will be using "artificial intelligence to take orders of customers passing through the drive-thru," according to local television station WHIO-TV

The automated drive-thru ordering system developed by Hi Auto uses "artificial intelligence" to greet and take orders from customers. 

Andrea Newport, the spokesperson for Lee's Famous Recipe Chicken, said, "employees in the restaurant will be able to listen to every transaction through existing headsets and intervene in case an issue arises during the order process."

Far Hills Development, LLC operates the Englewood location and 12 other locations around Ohio. The company believes artificial intelligence will alleviate staffing problems due to the virus pandemic. 

... and this is creepy.

"The technology also can be scaled to include video and recognize license plates and greet regular customers by name and know their favorite menu items," Newport said.

Technological unemployment is set to soar as robots and artificial intelligence are replacing jobs faster than ever due to the virus pandemic. The pandemic has created a strong incentive to automate the workplace. In pandemics, machines and computers don't catch infections. 

This all suggests that on top of the millions of jobs lost to the pandemic, there will be increasing jobs lost to robots, driving technological unemployment higher. 

For governments - now question now remains: What to do with the millions of people without jobs? Retrain them of usher in universal basic income? 

Tyler Durden Fri, 02/26/2021 - 21:20
  • 27 février 2021 à 03:20

The Coming Space-Race

Par Tyler Durden
The Coming Space-Race

Authored by Brian Berletic via,


The domain of space has become an increasingly important playing field economically and militarily amid the wider great power game here on Earth.

While mostly out of sight, the satellites circling overhead provide us with precise positioning information for navigation, communication, weather data, intelligence, and imaging for maps so readily available online – we have begun to take this all for granted.

The impact of this technology in orbit on our ability to engage in commerce and maintain military preparedness has become so vital over the past several decades that nations have begun dedicating not only more resources into developing spaceborne capabilities, but also creating the ability to monitor threats in space and develop methods to defend against them.

This has led to several nations creating “space forces,” with the United States creating the US Space Force in 2019. Russia and China also have equivalent military forces dedicated solely to the domain of space – though how they will be used will most certainly differ from how the US will likely (and is already beginning to) use theirs.

What we see unfolding now is geopolitical cooperation and conflict here on Earth being extended into Earth orbit and beyond.

China has begun launching as many, if not more rockets per year than the United States. Its capabilities range from placing entire satellite constellations into orbit, to launching its own astronauts and even space station segments, as well as commercial missions for clients from around the globe.

Russia continues to develop its space launch capabilities and currently still has these most reliable manned space launch systems on Earth – the Soyuz. Their plans to develop reusable rockets to remain competitive with American aerospace company SpaceX means that Russia too remains a significant partner/competitor in the space domain.

And of course, private companies – from the US to China and everywhere in between – are creating capabilities and pursuing objectives beyond existing state-dominated space programs – with US-based SpaceX creating everything from reusable launch vehicles, to satellite internet, to a fleet of stainless steel starships designed to colonize Mars.

And just beyond reach of current technology are resources in space in the form of minerals and ore on the Moon and trapped in near-Earth objects like asteroids that could open the door to a multi-trillion dollar space economy that could sustain a population within our solar system many times larger than the 7.6 billion people on Earth today.

Through this now quickly shifting and rapidly developing space industry we can see the stage being set for a new, and much more wide-ranging “space race” for the 21st century.

While the first space race was bipolar – between the United States and the Soviet Union – today’s new space race includes old adversaries – the US and Russia – as well as China, India, and even Iran. There are also a growing number of private space companies from US-based firms like Elon Musk’s SpaceX and Jeff Bezos’ Blue Origin, to Japan’s iSpace, and Galactic Energy in China.

The Space Economy 

There is a very real space-based economy already.

It consists of constellations of satellites providing everything from communication to navigational services – services that are playing an increasingly important role in the global economy.

Industries like delivery services heavily depend on satellite navigation to connect drivers with their destinations, aiding them in navigating to customers and allowing customers to track their progress in real-time. Food delivery alone is an industry of over $100 billion worldwide.

There are also taxi services that increasingly rely on satellite navigation to find and deliver passengers.

The growing importance of satellite navigation for the economy is only set to grow as companies around the globe explore the possibility of drone delivery services and modes of land transportation that are increasingly autonomous.

Communication satellites have long served an important role in advancing and connecting modern information technology. Satellite phones and now satellite internet are services already available around the world. These services depend on satellites in higher orbits over the Earth meaning that latency is higher – and internet speeds slower.

Geostationary orbits, while higher and providing slower communication speeds, require fewer satellites to cover any particular area – with specific satellites assigned to and stationed permanently over a single region of the planet.

Communication satellites in low earth orbit cannot remain over a single region of the planet permanently. They are constantly moving, and thus to create worldwide coverage, shells of constantly moving satellites with protocols meant to relay signals not only from the ground to orbit, but between satellites in orbit are required – and in large numbers.

The lowering costs of both satellite manufacturing and space launches to place them into orbit makes this possible today.

With SpaceX’s Starlink service, consisting of thousands of satellites in low earth orbit (and eventually tens of thousands of satellites), low latency satellite internet will be available worldwide with a partial network already being tested.

Other companies are attempting to create their own low earth orbit constellations including OneWeb and Amazon’s Project Kuiper.

Russia’s Roscosmos is planning to create a similar constellation and China via its Hongyun project is already launching satellites in a bid to create its own low earth orbit broadband internet constellation.

These would constitute global internet service providers – though satellites would still depend on ground stations that connected to the physical backbone of the Internet in order to receive and transmit data – and companies involved in proposing and building these constellations are designing custom tailored solutions on a state-by-state basis to address security concerns in an age where information warfare is as serious a threat as actual warfare.

There are also clear military implications regarding satellite navigation and communication.

Its use on the battlefield includes collecting intelligence, coordinating the locations of and communication between troops in the field, guiding warships at sea as well as warplanes overhead, guiding munitions accurately to their targets and for managing the growing fleet of unmanned military vehicles on land, in the air, and both on and under the sea.

The obvious importance of satellite navigation and communication for both a nation’s economy and its defense is why nations like the United States, Russia, China, and the EU have developed their own networks that they control and that they cannot be excluded from. These are networks that they can offer access to for allies and customers, to enhance their alliances and to open up streams of revenue.

The United States maintains the Global Positioning System (GPS) with a constellation of 31 satellites. The maintenance and protection of America’s GPS satellites was transferred to its newly christened Space Force.

Russia maintains the Global Navigation Satellite System (GLONASS) with 24 satellites in orbit. The EU’s Galileo network also consists of 24 satellites.

China recently completed its BeiDou network with 35 satellites in orbit – the largest network of its kind and one of several key indicators illustrating not only how serious China takes this new space race, but the competence it is able to bring to it.

The BeiDou network has already become a key component of China’s One Belt, One Road initiative. It is space infrastructure China is using to help stitch together the economies of Eurasia and to help augment the military capabilities of its allies – including nations like Pakistan who now have access to BeiDou’s higher military-grade positioning resolution.

Since China is building continent-spanning transportation infrastructure – creating and maintaining its own network of navigation satellites with global coverage prevents nations like the US from cutting it off from the GPS network at junctures of geopolitical tensions and potentially stranding logistical operations across entire continents.

CISLunar Economy 

United Launch Alliance (ULA) – a space lift company created by Boeing and Lockheed – has proposed what it calls a “cislunar economy.” Cislunar describes the space between the Earth and the Moon.

ULA’s proposal imagines a cislunar economy reaching $3 trillion by 2050. According to SpaceNews in an article titled, “ULA’s Tory Bruno argues for U.S. investments in the production of fuel in space,” that economy would include mining, transportation, manufacturing and space tourism. in an article titled, “Inside ULA’s Plan to Have 1,000 People Working in Space by 2045,” would note just how many people would make up that economy

CISLunar economy (Image Source: ULA/NASA)

Mining and in-situ manufacturing in space alone would be transformative for human civilization – akin to moving from the bronze age to the iron age. The resources trapped in near earth objects dwarf the total amount of resources here on Earth. It is just a matter of accessing it and possessing the tools to use it in manufacturing processes in space.

The science fiction future imagined in books and movies for decades could become a reality, complete with orbital habitats not unlike that featured in the 2013 film, “Elysium,” hopefully without the accompanying dystopian class divide.

While ULA’s own expendable launch vehicles are unlikely capable now or anytime in the near future of actually realizing their cislunar economy, other US-based companies and even those abroad might – and sooner than we imagine.

Jeff Bezos – Amazon founder and owner of US-based aerospace company Blue Origin – has proposed a roadmap (video) for the mining of resources and the construction of such habitats. Blue Origin is currently working on its New Glenn rocket – the closest launch vehicle in terms of capability and reusability to SpaceX’s Starship currently under testing. New Glenn, Starship, and similar launch vehicles would be needed to create the foundation of these proposed manned economies in space.

Getting to Space

Space was once the sole domain of a handful of government space programs.

Today, governments, corporations, and a mix of both are now widening the space launch capabilities of countries with space programs, as well as opening increasingly attractive options for nations without their own space launch capabilities.

To date, Russia, the USJapanChina, the EUIndiaIsraelUkraineIran, and North Korea have all demonstrated the ability to launch payloads into orbit.

Currently, China, Russia, and the US lead the world in total launches per year – placing public, military, and commercial payloads into orbit not just for their respective countries but for a wide range of customers from around the world.

China currently leads, or closely follows the US in total launches per year – depending on the year – with US-based SpaceX accounting for America’s ability to continue competing.

The US currently holds the edge in overall competitiveness – again because of SpaceX – and owed in particular to SpaceX’s reusable Falcon 9 launch vehicle. Some of its Falcon 9 boosters have flown and landed up to 8 times (at the time of writing). The boosters are designed to fly up to 10 times before major overhauls.

The merit of reusability has not been lost on America’s main competitors. China has been nurturing its own private space industry and several companies are pursuing Falcon-style reusability including Galactic Energy with its planned Pallas 1 rocket targeting a 2021 test launch. Companies like iSpace are also pursuing similarly reusable launch vehicles. Both companies have already reached orbit with expendable rocket designs.

Russia’s Roscosmos is developing its Amur rocket, following SpaceX’s strategy for reusability using a first stage that launches and lands under the power of its own rocket engines.

SpaceX itself – while continuing to launch its Falcon 9 on a regular basis (26 launches in 2020 alone) – is working on the next generation of reusable launch vehicles – Starship.

It will be the largest, most powerful rocket ever built and feature fully reusable first and second stages. It is designed ultimately not only to send people to Mars, but to be able to lift enough material, equipment, and people into orbit frequently enough to build a city on the red planet.

While this goal remains on a more distant horizon, the cargo lift capabilities of Starship – lifting 150 tons into low earth orbit – and its rapid reusability will make access to space cheaper than ever before. It will open up a variety of possibilities both economically and militarily for the United States and its allies, as well as for commercial partners around the world – while leaving other nations playing catch-up.

Nothing like Starship is even under development elsewhere around the globe. While China and Russia are developing heavy-lift rockets nearing Starship’s lift capabilities, none of them will be even partially reusable.

There is also the ability to reach other places in the solar system – other than Earth orbit. The US, China, Russia, and Japan all possess the capability to reach the Moon, Mars, and even near earth objects like asteroids.

In 2020 when the most recent launch window opened to send missions to Mars, the US and China both sent major missions.

NASA’s Perseverance rover successfully touched down on Mars’ surface earlier this month. The rover contains experiments to retrieve and eventually send back samples of the Martian surface to Earth as part of future missions to Mars, as well as an experiment for in-situ oxygen production which will be vital for human habitation and the production of fuel on Mars in the future.

China’s mission – Tianwen-1 – has also reached the red planet, featuring an orbiter, a lander, and a rover.

If China successfully lands on the surface of Mars it will signify a major milestone for the nation and its spaceborne capabilities. Having already reached Mars orbit and having sent back incredible pictures of the Martian surface – Tianwen-1 has already made a major geopolitical statement.

While critics say China has not done the many things the US has done in space and has a long way to go to catch up – China does not need to replicate America’s past achievements – it merely needs to match or surpass America’s current achievements and is working to do exactly this.

Mission accomplished: Japanese Hayabusa2 carrying asteroid samples in December 2020 (Image: JAXA)

NASA and the Japan Aerospace Exploration Agency (JAXA) have both sent missions to asteroids – a major first step toward eventually exploiting the vast amount of resources trapped in them.

JAXA’s Hayabusa missions both retrieved samples from targeted asteroids and returned them to Earth. NASA’s OSIRIS-REx mission has successfully collected a sample from asteroid Bennu and is slated to return it to Earth by 2023.

Getting into space and being able to reach a wide variety of destinations there – and being able to carry out a wide variety of activities will be key to expanding Earth’s economy into space. Government agencies and private companies are developing these capabilities at an increasingly faster pace each year with large implications regarding cooperation and conflict in space in the near future.

Conflict in Space

The networks being placed into orbit will enhance the economic and military capabilities of the respective nations on the ground launching them. The importance of creating and defending these networks is obvious.

Satellite navigation’s use in conducting warfare and in particularly accurately guiding unmanned aircraft and even munitions across the battlefield makes it an obvious target for electronic jamming.

F-35 Fighter (Image Source: Darin Russell/Lockheed Martin)

Here we can see the clearest example of how geopolitical competition on Earth is extending into the domain of space.

The National Interest in a 2019 article titled, “GPS Jammed: Russia Is Messing with America’s F-35s,” would claim:

Russian forces have been jamming GPS systems in the Middle East. The electronic-warfare campaign could affect U.S. forces gathering in the region in advance of potential strikes on Iran.

“Since last spring, pilots flying through the Middle East, specifically around Syria, have noted that their GPS systems have displayed the wrong location or stopped working entirely,” The Times of Israel reported in late June 2019.

GPS is essential for US military operations – and for pilots of warplanes like the F-35 in particular – both regarding navigation and guiding munitions to target. Jamming GPS signals in theater means partially blinding US warplanes and severely inhibiting their ability to carry out military operations.

While the US has claimed this jamming is a serious provocation, Syria is a nation the US has illegally occupied for years. This is in addition to its military occupation of Iraq and Afghanistan and, as the article points out, its planned military aggression against Iran, all nations thousands of miles from America’s shores, and all nations that pose no direct threat to the US itself.

The use of America’s GPS in the Middle East is explicitly for enabling military aggression abroad – not the defense of the United States itself.

With the founding of the US Space Force in late 2019, and with the new armed forces branch overseeing America’s GPS capabilities, it is certain that stopping Russia or any other nation from disrupting these capabilities overseas will become part of its mission.

It is clear that the US Space Force will be used – not to defend the United States itself – but to prevent others from defending themselves from US aggression and its spaceborne capabilities used to enable it.

Russia’s use of electronic jamming has complicated American aggression in the Middle East. But there are other threats to America’s spaceborne capabilities – and theoretically, to those of all other nations as well.

This includes anti-satellite missiles.

In 2007, when China tested an anti-satellite (ASAT) missile which destroyed one of its aging Fengyun series weather satellites, the West vocally protested – so much so – that many might believe China was the first ever to carry out such a test.

In reality, the US conducted a very similar test as early as 1985 using an ASM-135 ASAT missile mounted on an F-15 Eagle fighter aircraft. The missile was used to destroy the Solwind P78-1 satellite – a scientific platform nearing the end of its lifespan.

The early US test – like the Chinese one in 2007 – created debris that posed a hazard to other satellites and spacecraft in orbit. The US test even delayed the construction of what is now the International Space Station (ISS).

After the Chinese test in 2007 – and despite the US already demonstrating its ability to destroy satellites in orbit – the US carried out an additional ASAT mission a year later using a modified SM-3 missile to destroy the USA-193 reconnaissance satellite operated by the US National Reconnaissance Office (NRO).

While the mission was justified by claiming there were fears that the malfunctioning satellite could enter the atmosphere and cause contamination with its highly toxic fuel – the timing following the Chinese missile test made it clear this story was just cover for what was a tit-for-tat demonstration vis-a-vis China and a test of US missile defense systems as provocative as the US claimed China’s test was.

Russia began testing modern ASAT missiles in 2015, conducting several tests but none of them directed at actually destroying a satellite in orbit.

India – a nation with an increasingly capable space program – tested an ASAT missile in 2019 successfully destroying a test satellite in low earth orbit (LEO).

In other words, several nations now possess the ability to not only jam satellites but also destroy them.

For nations like the US who depend heavily on its GPS network when fighting wars of aggression abroad – the destruction of even parts of its GPS network would immediately impact its fighting capacity and require a time consuming and expensive process to replace lost satellites.

The advent of ASAT systems has increased the cost of US military aggression abroad should red lines be crossed and either Russia or China decide to begin targeting this crucial component of American military might.

On the other hand, US-based SpaceX – should its Starship launch vehicle begin placing payloads into orbit, it would be capable of replacing entire constellations faster than they could be shot down.

Here, we can see the potential ingredients for a space-based arms race.

Should ULA’s cislunar economy – or a version of it – begin to take shape, it will be difficult to imagine how economics in orbit and on Earth, as well as the conflict that will inevitably arise will take full shape.

It may resemble in many ways the process of exploring for and exploiting hydrocarbons here on Earth with a process of staking and exploiting claims clearly defined and competitors moving on to other objects in search for resources.

If current studies of near earth objects are accurate, there would be more resources in space than human civilization has the ability to fully exploit – although real estate on the Moon or Mars, or specific asteroids in closer proximity to Earth would be likely candidates for races, competition, and possible conflict.

Conflict might be fought out on Earth between respective nations over what is happening in space or a new class of weapons and tactics might be developed for use in space-to-space combat.

Here on Earth we can already see attempts by the US to pressure nations like Iran and hinder the development of Iran’s space program – which has already successfully placed payloads into orbit and is developing more capable launch vehicles as well as its own satellites to place in orbit.

Denial to space, and denial to regions in space may become common themes in near-future warfare.

Cooperation in space or exclusion of certain nations from specific projects has already become a geopolitical tool. Russia’s monopoly over manned space launches – only recently broken by SpaceX’s crewed Dragon 2 spacecraft – was a useful tool for Moscow to remind America of the limits of its omnipotence.

America’s plans for a Lunar Gateway station now exclude Russia – a politically-motivated decision that will cost America in terms of technical expertise can capabilities Russia could offer the project.

America’s exclusion of China from virtually all cooperation with NASA including on the International Space Station would at first serve to hinder China’s space program – but now appears to be spurring it.

China now plans to launch its own space station and will use it to cooperate with any  and all nations in space – including those thus far excluded by US-dominated projects.

These are possibilities that are no longer the domain of science fiction writers but the serious topics of policymakers and the aerospace branches of national armed forces around the globe.

Satellite-killing missiles, moon bases, Mars rovers, space stations, rockets taking off and landing under the power of their own engines – are fast becoming a reality or in some cases, are already here.

The new space race has begun and it is a race a growing number of nations and companies are joining on a nearly monthly basis.

Rockets are taking off from traditional launch sites in Florida and Kazakhstan – but also now from places like New Zealand and Amur Oblast in eastern Russia. SpaceX is building a spaceport in Boca Chica, Texas, near America’s border with Mexico. And China is constructing new launch facilities on land and at sea.

The scale and importance of activity in space is expanding rapidly, with ever-expanding rewards of the wealth, power and influence for its participants. Wherever there are people and resources – there will be competition, and in this new space race we will likely see this competition move beyond flag-planting and toward something that resembles actual conflict.

VIDEO: Amazon founder Jeff Bezos presents his and others’ plans for the future of outer space. Watch:

Tyler Durden Fri, 02/26/2021 - 21:00
  • 27 février 2021 à 03:00

New CDC Director Raises Alarm On "New Variants"... Despite Finding Virtually No Household Asymptomatic Spread

Par Tyler Durden
New CDC Director Raises Alarm On "New Variants"... Despite Finding Virtually No Household Asymptomatic Spread

On Friday, Biden's new CDC Director, Rochelle Walensky, issued a 'sobering warning' over new COVID-19 variants - in particular the B.1.1.7 strain first found int he UK, and which now accounts for an estimated 10% of current US cases. Additionally, variants in California and New York also appear to spread more easily, according to Bloomberg.

CDC Director Rochelle Walensky

"Things are tenuous -- now is not the time to relax restrictions," said Walensky, adding "The latest data suggest that these declines may be stalling, potentially leveling off at still a very high number. We at the CDC consider this a very concerning shift in the trajectory."

Walensky's warning was simultaneously parroted by Anthony Fauci - head of the National Institute of Allergy and Infectious Diseases - saying that people shouldn't become complacent, and that we may be wearing masks into 2022.

"We really have to be careful and take a look at that curve," he said, adding "If we plateau at 70,000, we are at that very precarious position that we were right before the fall surge, where anything that could perturb that could give us another surge."

"We may be done with the virus but clearly the virus is not done with us."

The renewed 'concern' comes as both COVID cases and deaths are falling precipitously.

According to BofA, "The seven-day average of new cases in the US is down up 5% from the prior week to 68,000," which they attribute in part to the impact of last week's winter storms driving down testing - but noting that "the true trend in infections is still likely modestly lower."

And now for the chaser; The CDC just admitted in its own report that asymptomatic and pre-symptomatic transmission within households - a key justification for lockdowns - turns out to be virtually nonexistent. Household transmission is the primary mode of infection for COVID-19.

As The Federalist's Georgi Boorman writes:

The Jan. 29 report’s conclusion seems to fit the pro-mask narrative, of course: “Schools might be able to safely open with appropriate mitigation efforts [such as masking and not allowing student cohorts to mix] in place.” In the 17 rural Wisconsin schools surveyed, only seven cases were linked to in-school transmission out of 4,876 pupils, and no staff members were infected at school during the study period.

While the report spends ample time explaining the mitigation strategies employed in the schools and the high reported mask compliance (92%) among students, the authors later discuss something you probably have not seen in any of the mainstream media’s coverage of this report:

“Children might be more likely to be asymptomatic carriers of COVID-19 than are adults…This apparent lack of transmission [in schools] is consistent with recent research (5), which found an asymptomatic attack rate of only 0.7% within households and a lower rate of transmission from children than from adults. However, this study was unable to rule out asymptomatic transmission within the school setting because surveillance testing was not conducted” (emphasis added).

The study, a meta-analysis of 54 studies into household transmission of COVID-19, was posted as a pre-print over the summer and published in December.

The most significant portion of the analysis finds that while asymptomatic and presymptomatic cases account for just 0.7% of transmission, symptomatic cases had an 18% attack rate within the household. In other words, most people who contract COVID-19 at home were infected by someone who was visibly ill.

"Estimated mean household secondary attack rate from symptomatic index cases (18.0%; 95% CI, 14.2%-22.1%) was significantly higher than from asymptomatic or presymptomatic index cases (0.7%; 95% CI, 0%-4.9%; P

As Boorman continues: "The key, if not central, rationale for non-pharmaceutical interventions such as masking, distancing, and staying at home is allegedly significant transmission from people who don’t show symptoms. If the contagiousness of people without symptoms is not what drives the spread of SARS-COV-2, then no COVID restriction on public life besides staying home when you are clearly sick could be justified, considering the obvious negative consequences of these restrictions."

Read the rest of the report here.

Tyler Durden Fri, 02/26/2021 - 20:40
  • 27 février 2021 à 02:40

Socialism-In-Practice Was A Nightmare, Not Utopia

Par Tyler Durden
Socialism-In-Practice Was A Nightmare, Not Utopia

Authored by Richard Ebeling via The American Institute for Economic Research,

It is amazing sometimes how really short humanity’s historical memory can be. Listening to some in American academia and on social media, you would think that socialism was a bright, new, and shiny idea never tried before that promises a beautiful future of peace, love, and bountifulness for all. It is as if a hundred years of socialism-in-practice in a large number of countries around the world had never happened. 

If the reality of actual socialism in the 20th century is brought up, many “progressives” and “democratic” socialists respond by insisting that none of these historical episodes were instances of “real” socialism. It was just that the wrong people had been in charge, or it had not been implemented in the right way, or political circumstances had prevented it from getting a “fair chance” of successfully working, or it is all lies or exaggerations about the supposed “bad” or harsh” experiences under these socialist regimes. You cannot blame socialism for there having been a Lenin, or a Stalin, or a Chairman Mao, or a Fidel Castro, or a Kim Il-Sung, or a Pol Pot, or a Hugo Chavez, or . . .  

Tyranny, terror, mass murder, and economic stagnation, along with political plunder and privilege for the few at the top of socialist government hierarchies were not indicative of what socialism could be. Just give it one more chance. And, then, another chance, and another. 

Soviet Statistical Lies Too Often Taken at Face Value in the West

These attitudes are really nothing new. Throughout the 20th century there were apologists aplenty making excuses, and accepting at face value whatever propaganda was spewed out by the mouthpieces for the socialist regime in Soviet Russia. They closed their eyes to any facts or evidence about what was going there. Those who found ways to escape from the prison camp known as the U.S.S.R. and who told about what life was actually like in the workers’ paradise were ignored or ridiculed as people with anti-Soviet axes to grind. Why else would they have left their wonderful Soviet motherland? 

Another version of this blindness was the acceptance of Soviet economic statistics at face value by many reputed Soviet experts in the West, including the “professional” analysts inside the intelligence services of countries like the United States. Both before and after the Second World War, a majority of these scholars and analysts took for granted the official statistics and related data released by the Soviet government about how wonderful and successful the Soviet centrally planned economy was. Soviet propaganda heralded the planning successes of the Soviet Union becoming an industrial country in the 1930s with the introduction of five-year central plans, including the forced collectivization of farming. Then in the years following the Second World War, Soviet state planning agencies produced massive amounts of statistical data showing that in the postwar period all was well and vibrant on the road to socialist prosperity. 

Communist Party leader Nikita Khrushchev proudly announced in 1961 that in twenty years; that is, by the 1980s, the Soviet people would be living in the long-promised and awaited future of a post-scarcity communism. The noted American economist and later Nobel Laureate, Paul Samuelson (1915-2009), had even suggested in his widely used economics textbook, in the editions published in 1960s and 1970s and even into the 1980s, that it was very possible that by the early 21st century, Soviet Gross Domestic Product would overtake American GDP. Soviet socialism will have shown its economic superiority over American capitalism.  

Soviet Socialism Realistically Shown by Western Correspondents in Moscow

There were notorious apologists and propagandists for the Soviet Union during the period between the two World Wars among the Western press corps stationed in Moscow. The most scandalous of them was The New York Times correspondent, Walter Duranty (1884-1957), who even received a Pulitzer Prize for his coverup reporting of the famine in the early 1930s during Stalin’s forced collectivization of the land that caused the deaths of upwards of 12 million men, women and children.

But there were solid Western truth tellers who did their reporting stints in the Soviet Union during this time; once they were home from their tour in Moscow and were free of the Soviet censors who restricted what they could send out of the country to their newspaper editors in the West, they told the reality of things in great detail. Two of the best of them, in my opinion, were William Henry Chamberlin (1897-1969) in his books, Soviet Russia: A Living Record and a History (1931), Russia’s Iron Age (1934) and Collectivism: A False Utopia (1937), and Eugene Lyons (1898-1985), in his writings, Moscow Carousel (1935) and Assignment in Utopia (1937).

It particularly became the case of revealing uncensored accounts of real life under Soviet socialism in the 1970s and 1980s. No candy-coated dry statistical data here. In the standard reporting style, the correspondents explained the logic of the planned society by telling unending tales about the absurdities of how central direction of an economy actually worked from the perspective of ordinary people going through their everyday lives. As well as about the oppressions, arrests, and torture of any and all suspected of “anti-Soviet” thoughts and actions. 

Again, in my view, among the most informative accounts may be found in Hedrick Smith, The Russians (1976), Robert G. Kaiser, Russia: The People and the Power (1976), David K. Shipler, Russia: Broken Idols, Solemn Dreams (1983), Michael Binyon, Life in Russia (1983), Kevin Klose, Russia and the Russians: Inside the Closed Society (1984), David Willis, Klass: How Russians Really Live (1985), David Remnick, Lenin’s Tomb: The Last Days of the Soviet Empire (1993), and Scott Shane, Dismantling Utopia: How Information Ended the Soviet Union (1994).

The Absurdities and Corruptions of Socialist Central Planning

In state enterprises, there was the meeting of manufacturing goals by producing components parts or finished products that met quantity and tonnage quotas under “the plan” that were unusable in size, shape or functionality, but which fulfilled the targets of output insisted upon by the central planners in Moscow. There were the consumer goods that were shoddy in quality, badly worked, and mismatched in quantities with those actually wanted by Soviet consumers in terms of styles, features, or dimensions. As long as production and output targets were met, at least on paper, it did not matter how stagnant, poor and frustrated were the lives of ordinary Soviet citizens, just so the middle level Communist Party authorities throughout the country and the central planning officials in Moscow could assure those above them in the higher echelons of Soviet power that all was going according to plan. 

It did not matter how economically inefficient, wasteful, and misallocated material, machinery and men may have been from a hypothetical centrally planned coordination perspective. If the quantities and types of inputs that were assigned to each production plant and factory by the planning agencies were found too little or too much to fulfill the output planning quotas, the plant production managers always had at their disposal a fix-it man on staff who bartered or bribed for needed inputs at other factories to meet the monthly production targets with surplus inputs at their disposal as means of paying for them. Not that this informal and illegal factor and resource market had anything to do with real cost-efficiencies or productivities. It all was just a matter of having what you minimally needed to make sure you met the plan target for that month. 

If that did not always work out, well, fudging the figures passed on to central planning bean counters higher up just needed to be done in the right way so that nobody noticed; and if it was caught by someone further up the Party and planning hierarchy, gifts and favors could be supplied to just the right person to assure that “juggling the books” remained safe “between friends.” Prices assigned to goods were meaningless, having been fixed by the planning agencies years, if not decades before, with no relevance or reality to actual supplies and demands. Endless lines for needed goods solved the rationing problems of Soviet society. For worthless goods, well, they could just sit on the shelves of unvisited government retail stores manned by government employees who could care less, as long as they got their pay and could “disappear” from work for hours to go about doing their own shopping for what they needed to get; hence, the popular Soviet phrase, “They pretend to pay us, and we pretend to work.”

Witnessing Soviet Consumer Life in the Soviet Socialist Utopia

I was traveling frequently to the former Soviet Union in the early 1990s doing consulting work on market reforms and privatization, some of it with the Moscow city government and the Russian Parliament, but mostly with anti-Soviet members of the government in Soviet Lithuania, who were determined to reclaim their country’s national independence and reestablish a market-based economy. (See my article, “Witnessing Lithuania’s 1991 Fight for Freedom from Soviet Power”.)

Several times when in Moscow, I went to the GUM department store complex, facing the Kremlin across Red Square. Today, in post-Soviet Russia, it has been modernized with stores and boutiques not much different than any such shopping areas in Paris, London or New York. But back then, it was all owned and managed by the Soviet state and supplied by the production and quotas of the central planning agency, GOSPLAN

The building had a U-shaped inside with three levels, on each level of which there were a variety of “people’s” retail stores. The building was old and dilapidated, with peeling paint and chips and cracks on the walls, walkways, and handrails. The place was dingy and dirty. It was an outstanding example of the achievements of Soviet socialism in service to the toiling masses in the bright and beautiful socialist paradise.   

Sullen and tired-looking people walked around the three levels, passing by and giving generally empty looks as they passed one store after another with their mostly empty shelves attached to depressingly gray and bare walls. Sales personnel stood behind counters with no or few goods, glumly interrupted in their empty stares into nowhere whenever a few customers asked a question or wanted to buy something. Clearly, the Soviet socialist retail mottos were “Service with a rude frown and a harsh word,” and “The Soviet consumer is never right nor ever wanted.” 

In the wisdom of Soviet central planning, there were no Western-style supermarkets. Instead, there were separate retail stores for individual or particular types of goods. I stood on a line in a “people’s” bread store, waiting and waiting to get to the counter at which I told a store employee which of the limited types of bread I wanted. I was given a ticket with the amounts desired and directed to stand and wait on a second line, at the end of which I paid for the loaves of bread I wished to buy. I was then given a receipt and instructed to join a third line from which, again after a long wait, I could pick up the bread I had paid for.

But, as the phrase goes, man does not live by bread alone. So, I went in search of the dairy and meat retail stores, which were not necessarily near where I had obtained the bread. And at each of these I repeated the pattern of line one, line two, and line three. Now, with bags containing whatever I was fortunate enough to actually find in supply at these stores, I finally found a store where bottled water and the Soviet version of soda drinks might be purchased. I got on a line that stretched well out into the street, and when, after a long, long wait, I had almost reached the counter inside the store, it was announced that they had exhausted their day’s supply and told everyone to come back tomorrow. But even in the socialist paradise, there were possibilities for a happy ending. From a corner inside the store a black marketeer shouted out that she had plenty of everything; of course, at a Soviet version of a “market” price. I had earlier noticed that this same woman now offering a plentitude of what people wanted had been standing in a doorway inside the store leading to the backroom where the bottled water and soda inventories were kept. What a coincidence!

Under the Watchful Eyes of Servants of the Soviet State

I often stayed in Moscow at the Cosmos Hotel, which was reserved for foreigners and into which Soviet citizens were barred, unless, of course, they were among the Party-approved prostitutes sharing their profits with their Party pimps and/or spying on selected foreign visitors about whom the Soviet authorities were especially interested. I once went out and did not return to the hotel that evening. When I came back the following morning, I took the elevator up to my floor, and when the doors opened I was greeted by one of the Soviet matrons assigned to each floor and grilled as to where I had been all night, since “It had been noticed” that my bed had not been slept in, and my movements needed to be accounted for. As the old song says, “Someone to Watch Over Me.” 

I rented a car at this Moscow hotel so my future wife and I could drive to Leningrad for a long weekend, and she would show me the city where some of her friends lived. I was warned by everyone that whenever I parked I needed to remove the windshield wipers and lock them in the car if I did not want them to be stolen. I was told by several people that I better make sure that I had filled up the gas tank and had borrowed several portable gasoline canisters to refill the tank along the way, since there were almost no gasoline stations along the 500 miles of road between the two cities. In the socialist wonderland there were also few gasoline stations even in Moscow. After locating one, I had a two-hour wait on a line to finally get the car up to the gas pump. In addition, my fiancé made a point of packing plenty of food and drinks for the trip because there were neither restaurants nor rest areas (other than just pulling off the road into the forest) along the road. And this, on the main thoroughfare between the two showcase cities of the Soviet Union!

I also experienced the delight of being stopped by a militiaman (policeman) for a traffic violation near the Lubyanka, the headquarters of the KGB, and I practiced the art of cash bribe-giving, even though I had done nothing wrong in my driving. I had the pleasure of attempting to get needed medicines in the socialist society of “free” health care when it was difficult to find the right person at a “people’s” clinic and for the right price; and even if you found such a person and you have the money to pay the bribe, the chances were that the needed antibiotic was simply unavailable. I also had the chance of trying to go out for dinner at a restaurant, and finding that socialist Moscow had very few open for the general public, and the few that there were required you to bribe the doorman to gain entrance to then find out that 90 percent of anything on the printed menu was actually not available. 

In the lobby of the old Russiya Hotel not far from the Kremlin I was having coffee with my future wife, when I noticed a hotel matron sitting on a bench along the wall pull out a small camera from under the coat on her lap and quickly take a picture of us before hiding the camera back under her coat. Somewhere in the archives of the secret police is the first-ever photo of the two of us together; if only I could get an 8×10 glossy! When we decided to get married, an official at the one marriage license office in Moscow that married Soviet citizens to foreigners told me that I would need a notarized document from the attorney general’s office in each of the 50 United States that certified that I was not married in their jurisdiction; in other words, I needed to prove a negative 50 times, and before any of the documents had expired. We were finally married in the U.S. 

What a world was that of socialism-in-practice! A world of what the Austrian economist, Ludwig von Mises, titled one of his shorter books, Planned Chaos (1947). But even more, Soviet socialism was an upside-down Alice-in-Wonderland Through the Looking-Glass world of literal planned madness.

When the French sociologist, Gustave Le Bon published The Psychology of Socialism in 1899, he feared that, “One nation, at least, will have to suffer it [the establishment of a socialist system] for the instruction of the world. It will be one of those practical lessons which alone can enlighten the nations that are bemused with the dreams of happiness displayed before our eyes by the priests of the new [socialist] faith.” Is it really necessary to go through it all again? Let us hope not.

Tyler Durden Fri, 02/26/2021 - 20:20
  • 27 février 2021 à 02:20

Biden To Let Trump-Era Rule Severely Regulating China Tech "Threats" Take Effect

Par Tyler Durden
Biden To Let Trump-Era Rule Severely Regulating China Tech "Threats" Take Effect

In a move that China state media has ironically enough said is part of broader White House policy that "smacks of Trumpism" - and which is also unpopular with American businesses, Biden will move forward with a rule that will allow the Commerce Department to ban tech-related business on US soil deemed to "pose a national security threat".

It appears yet more confirmation that Trump's prior efforts to "box-in" Biden on China are proving effective. The rule proposed under the Trump White House as late as January, and based on a prior Trump-issued executive order from 2019, might not be enforced as "aggressively" - officials quoted in The Wall Street Journal seek to assure, however, it's also said that Biden doesn't want to appear "soft" on China in nixing it.

Specifically, "Administration officials are concerned that blocking or diluting the rule would send the wrong message about the new administration’s approach to China, potentially fueling criticism that it is taking a weaker approach, according to the people," WSJ writes.

Via Bloomberg

It comes after a series of Biden national security cabinet picks have in recent weeks been pressed in confirmation hearings over whether they'd be "tough" on China. Despite this, it remains hugely controversial and deeply undesired among US businesses and industries, given at the very least the confusion and lack of compliance guidance that can be expected out of Washington.

Addressing the feared deep and lasting negative impact on the US economy itself, WSJ explains:

The rule could affect millions of American businesses, according to a Commerce Department estimate, potentially requiring them to get government clearance for purchases and deals involving sophisticated technology with what the regulation calls a "foreign adversary," or face potential unwinding of the deals or other enforcement.

Everything from sophisticated electronics, most especially computer components and iPhones, to camera equipment to vehicles, could potentially be impacted by a web of confusing regulations that could ensue. 

Leading the charge against implementing the rule includes IBM, which was quoted in Bloomberg as saying, "By the Commerce Department’s own estimate, this rule would impose many billions of dollars in new compliance costs on millions of U.S. firms, including countless small businesses.

As indicated in the quote by IBM Regulatory Affairs Vice President Christopher Padilla, it's simply Biden carrying a Trump policy on "autopilot": "Such a massive, overbroad, and economically damaging Trump-administration rule should not be on autopilot," he said. It goes without saying that small businesses are still being battered by the COVID-impacted economy, which means Biden's move will further be seen as hitting them while they're still down - perhaps all in the name of not being "soft" on China.

Tyler Durden Fri, 02/26/2021 - 20:00
  • 27 février 2021 à 02:00

Judge Rules Arizona's Maricopa County Must Turn Over 2.1 Million November Election Ballots To Senate

Par Tyler Durden
Judge Rules Arizona's Maricopa County Must Turn Over 2.1 Million November Election Ballots To Senate

Authored by Jack Phillips via The Epoch Times (emphasis ours),

A judge on Friday ruled that Maricopa County must provide some 2.1 million ballots from the Nov. 3 election to the Arizona state Senate and allow access to its election equipment to conduct an audit.

Poll workers count ballots inside the Maricopa County Election Department in Phoenix, Ariz., on Nov. 5, 2020. (Olivier Touron/AFP via Getty Images)

Maricopa County Superior Court Judge Timothy Thomason ruled that subpoenas issued by Arizona’s state Senate are valid and should be enforced, and he disputed arguments from Maricopa County officials saying the subpoenas are unlawful. The county previously stated that multiple audits have been sufficient and said ballots should be sealed.

The Court finds that the subpoenas are legal and enforceable,” Thomason wrote (pdf) in his ruling. “There is no question that the Senators have the power to issue legislative subpoenas. The subpoenas comply with the statutory requirements for legislative subpoenas. The Senate also has broad constitutional power to oversee elections.

He argued that the “Arizona legislature clearly has the power to investigate and examine election reform matters,” adding that senators can “subpoena material as part of an inquiry into election reform measures.”

The move was hailed by Republican legislators in Arizona.

Arizona Senate President Karen Fann, a Republican, told news outlets after the judge’s ruling that their move was “never about overturning the election, it was about the integrity of the Arizona election system.”

“This was always about voter integrity and the integrity of the voting system itself,” Fann added.

State Sen. Warren Petersen, a Republican, confirmed that the Senate will go through with a “forensic audit” of Maricopa’s Nov. 3 election results. Maricopa County, which includes Phoenix, saw more than 2.1 million people vote during the last election.

But Bill Gates, the vice-chairman of the Maricopa Board of Supervisors, wrote Friday that the county has “nothing to hide,” adding that officials have “conducted three fully transparent audits, including two forensic audits by independent, qualified and outside Vote System Testing Laboratories.”

“I trust the Senate will be completely transparent with the public as Maricopa County has been,” he added. “From the beginning, the County sought clarification from the court. The court has ruled. I look forward to working with the Senate to provide them the information they are requesting.”

The subpoenas were issued following allegations of voter fraud and irregularities made by former President Donald Trump and surrogates including Rudy Giuliani.

A dispute over the election began when former Senate Judiciary Chairman Eddie Farnsworth held a hearing to question county officials about the election. Farnsworth and Fann then issued several subpoenas, which prompted Maricopa County to issue a lawsuit. The subpoenas were re-issued in January.

It’s not clear if the Maricopa Board of Supervisors will appeal Thomason’s decision. The Epoch Times has reached out to the county for comment.

Tyler Durden Fri, 02/26/2021 - 19:40
  • 27 février 2021 à 01:40

'Brace For Rampant Inflation': Hedge Fund Billionaire Stunned At "Market Craziness", Sees "Trouble Ahead"

Par Tyler Durden
'Brace For Rampant Inflation': Hedge Fund Billionaire Stunned At "Market Craziness", Sees "Trouble Ahead"

In 2012 Elliott Management's Paul Singer correctly warned that financial system leverage and technology would "serve as an accelerant in the next crisis":

"The major message that I want to give you (and I’ve invited challenge on both parts of my thesis here and I’ve never had anybody challenge it): The major financial institutions in the US and around the globe are utterly opaque; and The next financial crisis will happen faster, more suddenly."

Risk did indeed happen fast, numerous times since.

In 2014, Singer went more aggressively after the central banks and their arrogant largesse:

"There is no reason to suppose that they [central bankers] understand the modern financial system and economy to any greater extent than they did in 2007 (that is to say, not at all). Nevertheless, they plow ahead, expressing total confidence that what they are saying and doing is wise and not dangerous drivel."


"It is unlikely that these unprecedented and experimental government policies of such gargantuan scope will actually create the desired result and allow themselves to be able to be unwound without great shock and disruption to the global financial system."

His solution at the time:

"Although the levitation of financial assets has yet to levitate gold, we will grit our collective teeth on that score and await either 'asset price justice' or the 'end times,' whichever comes first."

Justice was to come a couple of times since.

Interestingly, 2014 was when Singer began to warn about inflation and the potential for social unrest:

"...inflation is spreading in both scope and intensity. If and when it breaks out in an inescapably broad way, there will be a crowd of seriously confused policymakers making excuses and claiming that inflation does not in fact exist; it is not their fault; it was completely unpredictable; and/or it will actually be good for people.

"We believe that if and when inflation goes from being something that affects only a particular list of assets (a growing list, presently a combination of things owned by the well-off plus a number of things that are basic necessities) to a widespread “in-your-face” phenomenon affecting the cost of living of almost the entire population, then the normal yardsticks of risk, return and profit may be thrown into the garbage can. These measures may be replaced by a scramble by citizens and investors to preserve value on a foundation of shifting sand, together with societal unrest that may make the current politically-useful “inequality” riffs, blaming the “1%” and attacking those “millionaires and billionaires” who refuse to “pay their fair share,” look like mere warm-ups for real class warfare."

He hasn't always been right, obviously, as he claimed in 2016 that Donald Trump (if elected) would "cause a widespread global depression." Quite the opposite happened, and the depression, it turns out did not happen until China (allegedly) unleashed COVID on the world.

Which brings us to Singer's prophetic 2019 warning that a 40% crash was coming for the stock market.

"global debt is at an all-time high. Derivatives are at an all-time high and it took all of this monetary easing to get to where we are today and I don't think central bankers, or policymakers or academics are in any better shape to predict the next downturn and I think we are the high end of the risk spectrum."

He then ominously added that "I'm expecting the possibility of a significant market downturn."

“December [2018] supported the notion that they’re trapped,” he said.

“What they should have done, and what they should do now, is try to restore the soundness of money. They should not be cutting rates right now. They should be calling on the congresses and parliaments around the developed world to take steps to deal with the economic slowdown in growth.”

He was right again in 2020 as all hell broke loose everywhere and prompted more of the policies he has been warning of since at least 2012.

And now - after 10 years - Singer is readying himself for the final victory lap, as he tells investors in his latest letter that he can't wait to say "I told you so" having long-warned of an ugly end to the Fed's extreme (and getting extreme-er) easy-money policies.

“We believe that hindsight will show the champion of head-smacking craziness in the American stock market to be the period playing out right now,” the 76-year-old exclaimed, adding that a "flamboyant line-up" of excesses will come back to haunt investors.

The (very visible) invisible hand behind all this excess is, in Singer's (correct) opinion, The Fed (and the rest of the world's central banking copycats) as he echoes Michael 'Big Short' Burry's recent warnings of out of control "rampant inflation" that will shock policy makers, stock pickers and bond investors, alike.

'Trouble ahead' is signaled by a rare combination of low-quality securities, staggering valuation metrics, overleveraged capital structures, a scarcity of honest profits, a desperate dearth of understanding evinced by the most active traders, and economic macro prospects that are not as thrilling as the mobs braying ‘Buy! Buy!’ seem to think,” he wrote.

Having registered annualized gains of about 13%, Elliott's performance over 44 years suggest Singer is worth listening to as Bloomberg reports he clearly exuded frustration at what he sees as the hysteria driving everything from Bitcoin to government debt - a “return-free risk,” as his letter put it.

Specifically, Singer is not a big fan (to understate it extremely) of Bitcoin:

“Pulling out your hair is an option, though only if you have hair to spare,” the mostly bald Singer wrote.

“Hiding under the bed to avoid people who gloat about being long Bitcoin can get…tiring. Deep breathing exercises can work, but only for short periods. We continue to press on for the day when we can say, ‘We told you so.’”

In conclusion we go back to Singer's 2012 warning.

"Nobody in America has actually seen, or most people probably can’t even contemplate, what an actual loss of confidence may look like.

If you think about some of these elements and how they might interact, you might come up with other paths of transmission or risk and pain. But I wouldn’t go about your business thinking it’s business as usual in a typical post-crisis, post bear market recovery."

Given the chaos in Treasury markets this week, it seemed apropos.

Tyler Durden Fri, 02/26/2021 - 19:20
  • 27 février 2021 à 01:20

Global Military Spending Hit Record High In 2020 With US In The Lead

Par Tyler Durden
Global Military Spending Hit Record High In 2020 With US In The Lead

Authored by Dave DeCamp via,

Despite the damage coronavirus lockdowns did to the world’s economy, 2020 marked a record high in global military spending, according to a new report. As always, the US was in the lead, accounting for 40.3 percent of the world’s military expenditures at $738 billion.

The report, released by the International Institute for Strategic Studies (IISS), says total military expenditures added up to $1.83 trillion in 2020, a 3.9 percent increase from 2019. "This came despite the coronavirus pandemic and the subsequent contraction in global economic output," the IISS said.

Via War on the Rocks

Second behind the US was China, which accounted for 10.6 percent, or $193.3 billion. After the US and China, the top spenders were India, the UK, and Russia.

The report said military spending increased in the US by 6.3 percent in 2020. In China, it grew by 5.3 percent, slightly lower than the 5.9 percent growth seen in 2019.

Based on the research, Stars & Stripes had some interesting observations on China:

However, IISS and other research groups have questioned China’s budget transparency in recent years. The Stockholm International Peace Research Institute pegged Chinese defense spending at $261 billion in 2019.

China’s maritime paramilitary forces are using facilities in the South China Sea as forward operating bases, the report noted. China has also built artificial islands in the sea over the last decade and constructed bases on natural features claimed by other nations in the region.

"Beijing seems intent on achieving primacy in its littoral areas," IISS said.

Meanwhile, China’s navy has maintained an “over-the-horizon” presence focused on extending its reach.

The top 15 military budgets in fiscal year 2020, via IISS

European NATO countries have increased military spending by 20 percent since 2014, according to the report. Although in 2020, Europe’s military spending only grew by 2 percent, compared with 4.1 the year prior.

But overall, IISS believes Europe could be where the most growth in defense spending is seen in the coming years.

Tyler Durden Fri, 02/26/2021 - 19:00
  • 27 février 2021 à 01:00

The Ten "Peaks" Behind BofA's Call For A Second Half Crash

Par Tyler Durden
The Ten "Peaks" Behind BofA's Call For A Second Half Crash

Having been bearish for much of the past 3 months, BofA's Chief Investment Officer looks at the chaos unleashed by surging bond yields in the past week, and extrapolates a period of much greater pain across all markets, driven by a flood of what he calls the "contrarian Ps" which include:

  • pandemic (vaccine winning),
  • prices (bond crash),
  • positioning (bullish),
  • policy (excessive & impotent),
  • profits (peaking Q2)

... which leads Hartnett to an "absolute" call that the first half od 2021 will mark the top in stocks & credit, leading to a substantial market correction, while relative value call is inflation hedges, with Hartnett calling "energy the new BTD trade" (something we have been saying since last fall), while growth defensives such as staples the barbell partner to this core trade.

And just to round off the increasingly dismal picture, Hartnett then lays out ten "peaks" that underscore his pre-crash outlook:

Peak pandemic: global vaccines (219mn) outpacing global virus (113mn – Chart 3); anticipation of vaccine > virus has already been Q4/Q1 catalyst for reopening>lockdown, cyclicals>defensives, small>large, value>growth...sell-the-vaccine = risk>return.

Peak prices I: bond sell-off hitting speculative froth, ghosts of 1999, ARKK look ominously like Invesco (Chart 5).

Peak prices II: bond sell-off eroding bull leadership of i) Housing (past three months US house prices annualizing 19% gain, lumber prices have doubled – Chart 4), ii) Credit (LQD

Peak prices III: bond sell-off…next risk big levels fail, e.g. Dow Jones 30k, Nikkei 30k, SOX 3k, KOSPI 3k, ChiNext 3k. bond sell-off has been wonderful for high yield, small cap, banks, energy, EM…when these reverse as bond yield rise = rate rise flips from good to bad (Chart 6); most imp triggers for bonds = cyclicals selloff…HYG 6.55 (China no longer tolerating FX appreciation).

Peak positioning: only reason to be bearish is there is no reason to be bearish…record, stunning $414bn inflow to stocks past 16 weeks (Chart 7), and yet stocks struggling; unlike ‘13 & ’18 bond losses in ’21 yet to incite bond fund outflows.

Peak policy I: rate cuts in 2020 = 191; rate cuts in 2021 = 3; no Fed YCC before >2% GT10 yields or

Peak policy II: monetary impotence or fiscal impotence inducing bond sell-off that exceeds on annualized basis 1994, 1999, but not quite taper tantrum of 2013 (Chart 8); bond busts (don’t forget 2018) lead to contagion, illiquidity, busts, bankruptcies…volatility & hedges against inflation & currency debasement set to outperform in 2021.

Peak policy III: 3Rs of Rates, Regulation, Redistribution historic catalysts end bull markets & bubbles…we say all '21 events, not '22, all spell lower/volatile coming quarters; 2020 = secular low for rates/inflation = "buy humiliation, sell hubris" = inflation assets to beat deflation in coming years.

Peak profits I: BofA Global EPS model says peak profits 20-25% YoY in Q2; could be >10% nominal GDP growth, surge in labor participation rates quashing wage growth, inflation peaks Q2 not EPS, productivity on up as COVID-19 inspires tech innovation means we wrong, but….

Peak profits II: a. even during stagflationary ‘70s, equities obeyed PMIs and today’s PMI levels rarely get higher;

... b. past 9 months...Asian exports...”V”, global PMIs...”V”, US housing...”V”, US retail sales...”V”, global capital goods orders “V”… yet no one believes global inflation will “V” despite epic stock market & housing inflation, US politicians about to spend another $2tn, TIPS breakevens highest since ’11...

... maybe a straw that will break the camel’s back…watch March 30th Alabama vote on unionization at Amazon; trough labor unionization & peak corporate equity valuation not a good combo.

Tyler Durden Fri, 02/26/2021 - 18:40
  • 27 février 2021 à 00:40

Trump Is "Still The Future Of The Republican Party" Says Don Jr.

Par Tyler Durden
Trump Is "Still The Future Of The Republican Party" Says Don Jr.

Authored by Jack Phillips via The Epoch Times (emphasis ours),

Donald Trump Jr. asserted that his father, former President Donald Trump, is still the future of the GOP ahead of his speech at the Conservative Political Action Conference (CPAC) this weekend.

If you’re reading the room and you’re intelligent, you realize that Donald Trump is still the future of the Republican Party,” Trump Jr. said on Fox News. “Those people who are being displaced by illegals, those people who are being swept aside by the Democrat Party, who has just flagrantly ignored them for decades, Donald Trump is all over that,” he added.

Trump Jr. is scheduled to speak at CPAC on Friday, while the former president will give a speech on Sunday.

The former commander-in-chief has not yet indicated whether he would run for president in 2024. Trump was impeached and later acquitted by the Senate earlier this month, triggering a schism between Republicans who either voted to impeach or convict and those who did not.

Since the Jan. 6 Capitol breach, a number of corporations severed ties with Republicans. The younger Trump argued that it may ultimately be a positive development because it shows the GOP represents working-class Americans, rather than Democrats—who have for decades attempted to cast themselves as the party representing the working class and unions.

The Republican Party isn’t going to be bound to those corporate interests anymore,” he argued in the Fox interview. “So I love that they are making that link and breaking it, because we need more of that and we need candidates and people who will go to bat, who will go to war and fight for the American working class and make sure we put them first.

Trump added that it’s unprecedented in history for it to be considered “controversial” for “leaders of a nation to put their people first.” He added: “Why is it now, and how do the Democrats get away with making America last as opposed to first?”

A number of opinion polls in recent weeks suggest that Trump is still viewed highly by Republican voters, with one survey showing that up to 70 percent of Republicans would consider joining a Trump-backed political party.

Since the Jan. 6 incident, Trump was de-platformed by Big Tech firms, including Twitter—his once-favored social media platform—and has delivered messages to supporters and the media mainly via email. Should he run again for president, it’s not clear if he would attempt to join an alternative social media website and app like Parler or start his own.

Tyler Durden Fri, 02/26/2021 - 18:20
  • 27 février 2021 à 00:20

US & Israel Convene Top Secret "Strategic Forum" On Iran

Par Tyler Durden
US & Israel Convene Top Secret "Strategic Forum" On Iran

With expected EU-sponsored US and Iranian talks toward restoring the nuclear deal (JCPOA) still at an impasse before they've even begun, Israel is on a full diplomatic blitz of Capitol Hill to prevent what's it's long claimed to be merely Tehran's "cover" for secretly developing a nuke, even with inspectors on the ground.

As Washington and Tehran continue their blame game and tit-for-tat on who will "comply first", the Biden administration will sit down with Israeli security officials for a "strategic forum" on Iran. Axios first learned this week that the close allies have "elected to reconvene a strategic working group on Iran, with the first round of talks on intelligence surrounding the Iranian nuclear program expected in the coming days."

Via AP

This will present Tel Aviv with an official forum with which to make Netanyahu's case for permanently shooting down the 2015 nuclear deal, or at least to impose higher and more stringent requirements on Iran if it hopes to keep its nuclear energy program. Alternately, the White House is likely to use the opportunity to ensure a political fight will be avoided with America's closest Mideast ally.

The "working group" on Iran was first established under the Obama administration, giving opportunity for intelligence sharing at the highest levels - even at a policy level - which has made it a 'top secret' initiative from the beginning. The need for the group became somewhat moot given Trump later ramped up 'maximum pressure' and turned toward regime change strategizing.

Axios reviews some of the details of the reestablished US-Israeli forum as follows

  • It was the main venue for strategizing over how to apply pressure to Iran during Obama’s first term, and it became the primary setting to air disagreements about the nuclear deal during Obama’s second term.
  • During Donald Trump's tenure, the forum convened to discuss the U.S. withdrawal from the nuclear deal and to coordinate the "maximum pressure" campaign.
  • The forum is headed by the U.S. and Israeli national security advisers — currently Jake Sullivan and Meir Ben-Shabbat — and includes top officials from across the various national security, foreign policy and intelligence agencies in both countries.

Meanwhile, the Netanyahu government has considered US re-entry into the JCPOA as nothing less than an "emergency" and national security crisis.

Further complicating matters was the fact that it took Biden a full month to actually return the Israeli Prime Minister's phone call. The new forum will likely be Israel's only shot at engaging the White House on the Islamic Republic.

Tyler Durden Fri, 02/26/2021 - 18:00
  • 27 février 2021 à 00:00

For Bonds, This Is Now The Second Worst Bear Market In 40 Years

Par Tyler Durden
For Bonds, This Is Now The Second Worst Bear Market In 40 Years

Last December, we predicted that the US was heading for a "titanic taper tantrum" in 2021, to an extent as a result of a sharp drop in bond demand as a result of reduced bond purchases by the Fed but also due to a spike in inflation which would lead to a sharp drop in demand for duration.

So fast forward to this week when the crash in US Treasurys, and especially the belly of the curve led by a plunge in 5Y prices...

... led to a historic vol shock as the real 10Y yield soared and which crushed both bond and equity bulls, but especially risk parity and balanced funds, who suffered tremendous losses as the conventional hedging role that bonds play was reversed as the bond stock correlation reversed from deeply negative to positive...

... resulting in a crushing blow to risk parity returns.

What is more remarkable is that while this week was terrible for bond bulls, the past year has been just as painful. As Bank of America's Michael Hartnett writes today, the past 12 months have been great for equity investors with the GOAT rally since March, coupled with a GOAT V-shape macro recovery... yet on the other side we have had a bond bear market which is now also one of greatest-of-all-time. Consider that since Aug 4th annualized price return from +10-year US govt bonds = -29%, Australia -19% (they do YCC!), UK -16%, Canada -10%. Hartnett's advice is to watch bank stocks for the “tell” on how badly the bond rout is hurting liquidity & growth expectations.

But going back to our original warning from December about a "titanic taper tantrum", what we find stunning is that while Thursday may well have been the culmination of growing concerns about runaway inflation (and, to Michael Burry, hyperinflation), even if more pain is certainly coming if the US is set to suffer through a period of 4%, 5%, 6% or more inflation, the pain for bonds over the past year is absolutely staggering, and as Michael Hartnett notes, the "Vaccine Bear Market" in bonds is now the second worst bear market in history...

... and warns that the monetary impotence or fiscal impotence inducing bond sell-off that exceeds on annualized basis 1994, 1999, but not quite taper tantrum of 2013, may "lead to contagion, illiquidity, busts, and bankruptcies" ... which is why volatility & hedges against inflation & currency debasement set to outperform in 2021.

Tyler Durden Fri, 02/26/2021 - 17:40
  • 26 février 2021 à 23:40

FDA Panel Unanimously Endorses J&J Covid Vaccine

Par Tyler Durden
FDA Panel Unanimously Endorses J&J Covid Vaccine

While it was so widely expected the announcement was merely a formality, just after 5pm on Friday the FDA Advisory Panel voted unanimously (22-0) to endorse the (one-shot, no mRNA) J&J vaccine, saying the benefits outweigh the risks, and recommended the agency grant emergency authorization, moving the nation's third vaccine one step closer to getting into Americans' arms.

The vaccine was 66% effective in protecting any cases of moderate to severe illness. It was 85% effective against severe cases of COVID-19 and completely prevented hospitalizations and death, four weeks after inoculation.

The FDA could now give the green light to the single-dose vaccine as early as Saturday, and it probably will.

Vaccinations will then begin as soon as a Centers for Disease Control and Prevention (CDC) panel recommends the vaccine and the CDC accepts that recommendation. The CDC panel is scheduled to meet Sunday.

"We are at the precipice of having another vaccine in our toolbox," CDC Director Rochelle Walensky said Friday. "Having an additional safe and effective vaccine will help protect more people faster."

The Johnson & Johnson (J&J) vaccine is different from the other two already on the market and could be a potential game changer. It is administered in a single dose, and does not need to be frozen when shipped and stored. It is also not based on the highly controversial mRNA technology used by Pfizer and Moderna. Unlike those two, the JNJ vaccine is what’s called a viral vector vaccine.

To create this vaccine, the Johnson & Johnson team took a harmless adenovirus – the viral vector – and replaced a small piece of its genetic instructions with coronavirus genes for the SARS-CoV-2 spike protein.

After this modified adenovirus is injected into someone’s arm, it enters the person’s cells. The cells then read the genetic instructions needed to make the spike protein and the vaccinated cells make and present the spike protein on their own surface. The person’s immune system then notices these foreign proteins and makes antibodies against them that will protect the person if they are ever exposed to SARS-CoV-2 in the future.

The adenovirus vector vaccine is safe because the adenovirus can’t replicate in human cells or cause disease, and the SARS-CoV-2 spike protein can’t cause COVID–19 without the rest of the coronavirus.

“We need vaccines that are effective and well-tolerated. And importantly, ones that are simple to deploy,” said Gregory Poland, director of the Mayo Clinic’s vaccine research group, who spoke to the panel as part of J&J’s presentation.

The endorsement from the FDA panel of experts comes as politically motivated federal officials are again scrambling to boost the panic meter by warning about the impact of recent highly contagious variants of the coronavirus, urging people not to grow complacent despite plunging cases and hospitalizations. The rise of variants makes vaccination more important than ever, CDC officials said.

CDC epidemiologist Adam MacNeil told the FDA panel said he expects the B.1.1.7 variant, first found in the United Kingdom, has likely spread throughout the entire U.S., and could become the dominant virus in mid-to-late March. However, inadequate genetic sequencing means we may never get the true picture. Furthermore, recent computer models have predicted that not even covid variants will prevent the US from basically being covid free by June.

While the pace of vaccinations has been steadily increasing, MacNeil said the U.S. is still "nowhere close" to herd immunity, which also is a politically-motivated falsity because as we showed earlier, at least 7 states are now on the verge of herd immunity. He emphasized the effectiveness of current strategies including masking and physical distancing.

Continuing with the political narrative, to date supply has been the primary constraint to the ramping up of the U.S. vaccination effort. A vaccine by U.S. pharmaceutical giant Pfizer and its German partner BioNTech, and another by Moderna were both authorized in December, but Pfizer has only shipped approximately 40 million doses, while Moderna has shipped about 45 million doses.

Johnson & Johnson's vaccine will only be available at a relative trickle at first. The company will only have about 4 million doses available to ship immediately upon authorization, but that number will increase to 20 million by the end of next month.

J&J has a deal with the U.S. government to supply 100 million doses of its vaccine by the end of June, and White House COVID-19 coordinator Jeff Zients said this week the federal government will do “everything we can” with the company to ramp up production.

The company asked the FDA to authorize the use of the vaccine in people aged 18 and older, but there were some concerns over the lack of data on recipients older than 75. There were also concerns over the effectiveness in people over the age of 60 with certain pre-existing conditions, like obesity and diabetes.

The J&J vaccine hasn’t been tested yet in children and teens under the age of 18, so it was not authorized for their use. A trial to study the safety and efficacy of the company’s vaccine in teens aged 17 and younger will begin late next month or early April.

Finally, while the two coronavirus vaccines already on the market may appear to be more effective than Johnson & Johnson's, experts say it is difficult to compare them head-to-head because of different clinical trial designs and different endpoints. Furthermore, the fact that the two previous vaccines are mRNA based - a rather novel and untested technology - may have sparked skepticism among many Americans.

"I really think we need to be careful not to read into the data, to look across studies when they are so different, and instead look at each vaccine individually," CDC's Nancy Messioner said Friday during an interview with the Journal of the American Medical Association.

Tyler Durden Fri, 02/26/2021 - 17:22
  • 26 février 2021 à 23:22

"A New World Altogether" - Global Airlines Set To "Go Live In March" With COVID 'Passports' 

Par Tyler Durden
"A New World Altogether" - Global Airlines Set To "Go Live In March" With COVID 'Passports' 

Imagine a world where the ability to travel on a commercial airliner depends on passing a COVID-19 test or taking a vaccine. If a traveler tests positive or did not receive or refused to take the vaccine, they would be locked out of air travel. 

This dystopic future could be the 'new normal' in a matter of weeks. All along, maybe the "conspiracy theorists" who warned of an overreaching system of control by the government were right. 

During a Wednesday press conference, the International Air Transport Association (IATA) said they would roll out a new travel app (called Travel Pass) to manage COVID-19 tests and vaccine certifications. IATA is the premier global trade organization for airlines, with 290 members. 

Since the early days of the pandemic (read: here & here & here), we've discussed "COVID passports," "immunity passports," or at least mentioned those who don't get tested for the virus or vaccinated could face travel restrictions. 

From conspiracy theory to conspiracy fact, this appears to be the case as IATA's new app will be rolled out in March.

Already, Singapore Airlines and twenty other airlines are testing the Travel App. In recent weeks, more airlines, such as American Airlines have expanded the use of immunity passports for international travel. 

"The key issue is one of confidence. Passengers need to be confident that the testing they've taken is accurate and will allow them to enter the country," said Vinoop Goel, IATA's regional director of airports and external relations.

"And then governments need to have the confidence that the tests that the passengers claim to have is one which is accurate and meets their own conditions," Goel said. 

"We are currently working with a number of airlines worldwide and learning from these pilots. And the plan is to go live in March," he said.

"So basically, we expect to have a fully functional working system over the next few weeks," he added.

The development of the app suggests airlines and governments have worked together to come up with a global solution to restart the crippled airline industry. Despite the imminent release of the app, IATA expects summer travel to be slow

So the question we ask readers is if COVID passports could actually backfire on the airline industry? After all, who wants private corporations and governments holding your private health data?

A corporation or government holding private health data could be a deterrence for some travels. Monitoring people's health erodes privacy, and electronic documentation leaves the data susceptible to hackers. 

A shortage of vaccines and or younger generations who are expected to get vaccinated later this year could result in unfair access to air travel. COVID passports appear to be a new form of discrimination. 

It comes as no surprise as billionaire and top vaccine pusher Bill Gates, for the last ten months, has been one of the most prominent figures discussing health passports.

After airlines, there is no telling what governments will do with these new health passports - they could be quickly extended to entering grocery stores, attending concerts and sports games, riding public transportation, and or even collecting unemployment. 

Already in Europe, Spain, Estonia, Iceland, Denmark, Sweden, Poland, and Belgium have indicated immunity passports will be used for cross-border activity.  

Former Prime Minister and globalist Tony Blair recently said the "world is moving in this direction," adding that he couldn't see another way of this," while referring to immunity passports. 

Blair has previously said that vaccine passports are inevitable and that "It's going to be a new world altogether."

Tyler Durden Fri, 02/26/2021 - 17:20
  • 26 février 2021 à 23:20

Federal Judge Rules Nationwide Eviction Ban Is Unconstitutional

Par Tyler Durden
Federal Judge Rules Nationwide Eviction Ban Is Unconstitutional

Authored by Janita Kan via The Epoch Times (emphasis ours),

A  judge in Texas on Thursday ruled that the federal government does not have the authority to issue a nationwide eviction moratorium.

Signs that read "No Job No Rent" hang from the windows of an apartment building in Washington on May 20, 2020. (Andrew Harnik/AP Photo)

U.S. District Judge John Barker, a Trump appointee, ruled in favor of a group of property managers and landlords who challenged a Centers for Disease Control and Prevention (CDC) order that prevented them from temporarily evicting tenants for non-payment of rent during the CCP (Chinese Communist Party) virus pandemic.

The CDC order in question was initially issued in September 2020 and was originally set to expire on Dec. 31, 2020. It was extended to Jan. 31 and then again until the end of March. The order aimed to mitigate the spread of the pandemic by reducing congregation in shared living settings or in unsheltered homeless areas, and support state and local responses to the disease.

The order made it a crime for a landlord or property owner to evict a “covered person” from a residence, subject to several exceptions. Tenants who are covered by the order include those who have used their best efforts to obtain government assistance for rent or housing; or whose income falls below a certain income threshold.

A person who violated the order could face up to one year of imprisonment, to be followed by up to one year of supervised release, and a fine of up to $250,000.

The order only pauses evictions but does not relieve tenants from rent or housing payments.

Barker said eviction moratoriums are usually enacted by states and that the lawsuit does not question the states’ authority to do so. But plaintiffs in the case are asking the court to determine whether the U.S. Constitution allows the federal government to order or legislate a nationwide moratorium on evicting specified tenants.

“After analyzing the relevant precedents, the court concludes that the federal government’s Article I power to regulate interstate commerce and enact laws necessary and proper to that end does not include the power to impose the challenged eviction moratorium,” Barker wrote in his 21-page ruling (pdf).

The Southeastern Legal Foundation (SLF) and Texas Public Policy Foundation jointly represented the plaintiffs in the case. The groups welcomed the judge’s decision.

The court’s order today holding the CDC’s interference with private property rights under the veil of COVID-19 serves as notice to the Biden administration that the Constitution limits government power,” SLF General Counsel Kimberly Hermann said in a statement. The moratorium was first issued by the CDC under the Trump administration, and extended by Congress and then the CDC under Biden.

“The federal courts will continue to be a primary bulwark against unconstitutional overreach by federal and state governments. As our record shows, we have fought and won cases just like this for decades, and the current administration has shown no restraint. We are preparing cases across the constitutional spectrum to defend against unrestrained government action.”

The lawsuit was filed against the United States, the CDC, the Department of Health and Human Services (HHS), and three HHS officials responsible for the order.

The Justice Department did not immediately respond to The Epoch Times’ request for comment.

Follow Janita on Twitter: @janitakan
Tyler Durden Fri, 02/26/2021 - 17:00
  • 26 février 2021 à 23:00

These 7 States Are On The Verge Of Herd Immunity

Par Tyler Durden
These 7 States Are On The Verge Of Herd Immunity

Nothing seems to scare the establishment more than a return to 'normal'. And by 'normal', we mean a return to an environment outside of the tyrannical control of career politicians and bureaucrats who have got a taste for this 'being king' stuff and know that anyone who questions their edicts will be 'canceled' by their Covidian cultists.

So, a week after Johns Hopkins surgeon, Dr. Marty Makary, penned an Op-ed in the WSJ saying that we will have herd immunity by April... and was instantly disavowed as 'dangerous', some awkward 'facts' and 'science' have been dropped by none other than FundStrat's Tom Lee.

"...cumulatively and slowly, the US is seeing more states reach that combined level of vaccinations + infections approach what is seen as herd immunity.”


So far, South Dakota, North Dakota, Rhode Island, Arizona, Oklahoma, Utah, and Tennessee are the nearest.

Lee's "math" - which we also know is racist - appears to fit with Makary's arguments for why the recent plunge in cases, hospitalizations, and deaths is not policy-related (no matter how much the politicians and their media lackeys push that narrative):

 "...the consistent and rapid decline in daily cases since Jan. 8 can be explained only by natural immunity. Behavior didn’t suddenly improve over the holidays; Americans traveled more over Christmas than they had since March. Vaccines also don’t explain the steep decline in January. Vaccination rates were low and they take weeks to kick in."

"Experts should level with the public about the good news..." exclaims Makary, and this data on imminent herd immunity puts more pressure on Fauci and Biden to come clean... despite their variant-fearmongering and "no return to normal until Christmas or beyond" predictions.

But of course, this reality may never be allowed in the national narrative, as Makary previously concluded:

"Some medical experts privately agreed with my prediction that there may be very little Covid-19 by April but suggested that I not to talk publicly about herd immunity because people might become complacent and fail to take precautions or might decline the vaccine. But scientists shouldn’t try to manipulate the public by hiding the truth. As we encourage everyone to get a vaccine, we also need to reopen schools and society to limit the damage of closures and prolonged isolation. Contingency planning for an open economy by April can deliver hope to those in despair and to those who have made large personal sacrifices."

But, but, the science!?

Tyler Durden Sat, 02/27/2021 - 10:44
  • 27 février 2021 à 16:44

Robinhood Is In Talks With FINRA To Settle March 2020 Probe Into Options And Outages

Par Tyler Durden
Robinhood Is In Talks With FINRA To Settle March 2020 Probe Into Options And Outages

Robinhood is reportedly in talks with Financial Industry Regulatory Authority to settle a March 2020 investigation that has been ongoing into the company. The probe is regarding app outages and option trading, Bloomberg reported on Friday.

At the center of the investigation was how Robinhood displays cash balances and buying power to its customers and the process that it undertakes to vet and approve traders for options trading. 

Robinhood noted the talks in a filing made on Friday, stating: “We have accrued in our statement of financial condition for the year ended December 31, 2020 of $26.6 million representing the bottom of the range of our probable losses. We cannot predict, however, whether these discussions will result in a resolution of these matters.”

The same filings show that the company had $154.2 million in net capital, Bloomberg reported.

And while fending off FINRA with one hand, Robinhood was also fighting a war of words against Charlie Munger with the other. We reported this morning that in an exclusive interview with the Wall Street Journal, the 97 year old Vice Chairman of Berkshire Hathaway sounded off about the "wild speculation" created by the budding brokerage.

“I hate this luring of people into engaging in speculative orgies. [Robinhood] may call it investing, but that’s all bullshit,” Munger said on Thursday. 

“It’s really just wild speculation, like casino gambling or racetrack betting. There’s a long history of destructive capitalism, these trading orgies whooped up by the people who profit from them.”

His comments on Thursday came after statements he made on Wednesday at the annual meeting of Daily Journal Corp., when he said “it’s really stupid to have a culture which encourages as much gambling in stocks.”

He said at the meeting: “You should try and make your money in this world by selling other people things that are good for them.”

And with one FINRA investigation off the plate, hopefully financial regulators will have plenty of time to look into Vlad Tenev's non-liquidity-related liquidity issues that emerged weeks ago as a result of the chaotic trading in GameStop. 

After weeks of doubling down on his early insistence that Robinhood wasn't suffering from a "liquidity issue", Tenev finally explained days ago to Barstool Sports' Dave Portnoy that "the 'L' word is a big thing in financial services: "A 'liquidity issue' means you can't meet your deposit requirements, you can't meet your margin requirements and are basically dead," he said.

Tyler Durden Fri, 02/26/2021 - 16:40
  • 26 février 2021 à 22:40