Mar 122021
 
 March 12, 2021  Posted by at 9:46 am Finance Tagged with: , , , , , , ,  23 Responses »


Paul Gauguin Yellow haystacks (Golden harvest) 1889

 

The New COVID-19 Relief Bill Is Good, But Not Good Enough (Jac.)
The Rights Of The Naturally Immune (AIER)
Fauci Was ‘Blind To The Harms Of The Lockdowns’ That Didn’t Work Anyway (JTN)
Advisory Committee On Pandemic Needs Variety Of Experts, Not Just Doctors (K.)
Generation Threatened As Pandemic Sets Back Childhood Development (Barrons)
Sweden’s Failed Covid Strategy Leaves The Country Deeply Divided (Peroni)
These Seven States Have Dropped All Covid-19 Restrictions (F.)
EU Investigates 30 Reports Of Blood-clotting Linked To AstraZeneca jab (RT)
New York Assembly Speaker Lays Groundwork For Cuomo Impeachment (JTN)
1000s Of Illegal Immigrant Children Penned In ‘Facilities Akin To Jails’ (JTN)
House Price Inflation in CPI is of Course Complete Baloney, But … (WS)
China Is Winning The Great 21st Century Tech War (Chang)
Journalists Start Demanding Substack Censor its Writers (Greenwald)
The Golden Question — Time vs Money (Ren.)

 

 

 

 

BIDEN: “If we do our part… by July 4, there’s a good chance you, your families, and friends will be able to get together in your backyard or in your neighborhood and have a cookout or a barbecue and celebrate Independence Day… Small groups will be able to get together”

 

 

 

 

“..the party avoided including any measures that might generate significant opposition from powerful corporate lobbies in Washington. ”

The New COVID-19 Relief Bill Is Good, But Not Good Enough (Jac.)

When Joe Biden signs the American Rescue Plan (ARP) on Friday, he will prove that the Democratic Party is finally willing — at least for a moment — to turn on the money hose and for once aim it not at Wall Street moguls, but instead at the raging wildfire of poverty and desperation incinerating the poor and middle class. That’s the very good news. The bad news is that the party’s COVID-19 relief bill also indicates that Biden might have been serious when he promised a room full of wealthy donors that nothing would fundamentally change about the macro-economy’s structure. Democrats did not use the must-pass bill to make essential, long-term changes to protect Americans against future emergencies. Instead, the party avoided including any measures that might generate significant opposition from powerful corporate lobbies in Washington.

Even worse, the ARP could make it far more difficult to enact structural changes in the health care sector that has been at the center of the pandemic and that helped make our country so uniquely unprepared for such a threat in the first place. To be sure, the package is a necessary rejection of austerity politics that have dominated Democratic politics since Bill Clinton promised in 1996 that “the era of big government is over” and since Joe Biden proudly cast himself as a deficit hawk in juxtaposition to his party’s New Deal tradition. This tectonic shift has been abrupt: When Democrats held a whopping fifty-eight Senate seats during the 2009 recession, Barack Obama listened to austerians like Lawrence Summers and passed a wholly inadequate $787 billion stimulus bill.

By contrast, with Democrats only holding fifty Senate seats amid the COVID crisis, Biden rejected Summers’s and his acolytes, and passed a $1.9 trillion bill.Biden only begrudgingly arrived at his current position. In August 2020, his campaign was telling reporters that “the pantry is going to be bare” and deficits meant “we’re going to be limited” in being able to spend any money at all. Then, in December, the New York Times reported that Biden was urging Democratic lawmakers to accept a COVID-19 aid package that included no direct aid checks at all.

After promising voters in Georgia that $2,000 checks “will go out the door immediately,” Biden quickly downgraded the amount to $1,400. The White House also entertained sharply limiting eligibility for those checks and cutting off payments to forty million Americans who received them in previous bills. (The final legislation wasn’t quite as draconian: it only penalized eleven million people.) The larger shift against this kind of austerity, then, reflects progressive pressure successfully shifting the terms of the budget debate away from the deficit scolds and away from Biden’s own previous ideology.

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Those rights are being vaccinated away. That makes the virus more dangerous.

The Rights Of The Naturally Immune (AIER)

There is an important issue that, in the midst of all the talk of vaccines, has not gotten nearly the attention it deserves: the civil rights of those who have already developed natural immunity to the SARS-CoV-2, the virus that is said to cause Covid. Yesterday, I got the results of the test I took to detect whether I had developed a T-Cell response to the virus. Like the antibody test I took almost 2 months ago, it was positive. These two things would appear to demonstrate that for all intents and purposes my body knew exactly what to do with this virus and that it probably has the equipment to dispose of it again were it, or one of its cousins, to revisit me in the near-to-medium term. And even if one or another related strain were to visit me in that future, studies suggest strongly that the attack would be considerably less virulent than the one I overcame without excessive trouble in December.

In a halfway rational world, what to do going forward in regard to getting a vaccine for the SARS-CoV-2 virus would be something I’d discuss with my doctor in the discreet quarters of the examination room. Were it to be offered, I would politely refuse it. And he, seeing the test evidence in my file, would raise no objection. And since the danger to me in the future from the virus is minuscule, and the science has clearly borne out what Fauci and Maria Van Kerkhove of the WHO flatly said was true before someone upstairs got to them—that asymptomatic transmission of respiratory diseases of this type is virtually nonexistent—I’d be free to live my life as I pleased without a mask, and with complete freedom of movement. But instead of this, I am facing enormous pressure to get a vaccine in order to recover my basic rights as a citizen.

And even then, those in charge are saying, I will still have to run around with a completely useless, breath-robbing and personality-canceling mask on my face. And all this for a disease that, even before the introduction of vaccines, gave those infected by it a roughly 997.5 out of 1,000 chance of survival. The civil authorities have decided, in effect, that fully indemnified pharmaceutical companies, whose pasts are obscenely littered with fraud, and the calculated creation of crises in order to up revenues on their products (OxyContin anyone?), have the de facto “right” to force me to take an experimental vaccine that, in the very, very best of circumstances, will only match what my apparently well-functioning body has already given me without any side effects.

And this, while straight out telling me that even if I submit to their government-coerced medical experiment I will probably still not get my full constitutional rights back. This is an important issue that needs to be addressed much more vigorously than has been the case up until now.

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Don’t let a virologist with large ties to Big Pharma run your country for a whole year.

Fauci Was ‘Blind To The Harms Of The Lockdowns’ That Didn’t Work Anyway (JTN)

Stanford University Professor of Medicine Jay Bhattacharya has been arguing for months that coronavirus lockdowns ultimately cause far more harm than good. As a co-author of the Great Barrington Declaration, he has been advocating an alternative to the public health establishment’s comprehensively restrictive COVID-19 mitigation policies — a strategy known as “focused protection,” which would instead tailor protective measures to the elderly and other high-risk groups while minimizing harm to the larger society by allowing those at lower risk to resume a semblance of their normal lives. Now Bhattacharya and the other signatories to the declaration may have received some empirical support from an unlikely source — a little-remarked new study from the Centers for Disease Control and Prevention, the very epicenter of the pro-lockdown public health establishment.

While the study trumpets its findings of statistical correlations of mask mandates and in-person dining bans with better outcomes for coronavirus case rates and death rates, the positive effects reported were decidedly modest in scale. Bhattacharya, who spoke with Just the News earlier this week, said that despite clear evidence that “lockdowns haven’t worked to stem the pandemic,” he sees a “strange desire to continue the lockdown,” especially in the upper echelons of the federal government. In Bhattacharya’s view, Biden administration chief medical advisor Anthony Fauci and other top public health officials have failed to view the risks to a subset of the U.S. population in the indispensable context of risks to the larger population produced by drastic mitigation policies like socially and economically stultifying lockdowns that blanketed much of the country over the past year.

“Part of the problem for Dr. Fauci,” Bhattacharya said, “is that he is blind to the harms of the lockdown … He seems not to understand that the lockdown creates all kinds of physical problems, psychological problems, harms that I’ve never seen him talk about.” Among the issues to which Bhattacharya alludes are rises in child abuse, depression, and divorce rates. Not to mention the large swaths of the American economy that have been decimated, and countless small businesses that will never reopen. Many of the pandemic restrictions didn’t “actually have any effect on slowing the pandemic or protecting people,” Bhattacharya asserted. “They were just indiscriminate closures that essentially protected the ‘Zoom class’ — the people who could afford to stay at home — while exposing the working class, other poor people and the vulnerable.”

[..] Beyond mask mandates (which he has previously said do not work to slow the spread of the disease) and restaurant closures, though, Bhattacharya says that the “single biggest problem” America is going to see as a result of a year of lockdowns “is the harm to children.” “There’s one estimate that the closure of schools will cause almost five and a half million life years lost to our children,” he said. “That’s because, if you’re less well-educated, you live a less healthy life, you live a less long life, it has this ripple effect that lasts forever.”

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From Greece. Dysfunctional.

Advisory Committee On Pandemic Needs Variety Of Experts, Not Just Doctors (K.)

The existing committee of experts advising the government on the pandemic must reshape to add experts from different research disciplines instead of one to become more efficient, according to a professor on Friday. Manolis Dermitzakis, professor of genetics at the University of Geneva, told Skai television that, in the first wave of the pandemic, the decisions for the committee were simple. It only had to decide whether some activities should open or close, while the public largely complied with the restrictive measures. But the complexity of the situation as the pandemic continued from the summer onwards was so great that a commission which includes only doctors could not function.


Dermitzakis also argued that the panel must have fewer members. “A committee that has 30-40 members and consists only of doctors cannot function,” he said. “It is a moment when we have to say that this committee is tired, perhaps it has passed the point where it can function. Maybe some of its members could continue to be useful, but what is needed is interdisciplinarity, that is, many different experts and a fewer people – five not 30.” Dermitzakis also said he supported the reopening of schools, stores and outdoor eating venues.

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“The number of children who are hungry, isolated, abused, anxious, living in poverty and forced into marriage has increased..”

Generation Threatened As Pandemic Sets Back Childhood Development (Barrons)

Closed schools, surging poverty, forced marriages and depression — after a year of the pandemic, indicators measuring child and adolescent development have all regressed, a setback that heralds lasting stigma for an entire generation, UNICEF has warned. “The number of children who are hungry, isolated, abused, anxious, living in poverty and forced into marriage has increased,” Henrietta Fore, executive director of the United Nations International Children’s Emergency Fund, said in a statement released exactly one year since the World Health Organization classified Covid-19 as a pandemic. “Their access to education, socialization and essential services including health, nutrition and protection has decreased. The signs that children will bear the scars of the pandemic for years to come are unmistakable,” Fore said in the statement.


Faced with such “devastating” effects, Fore urged for children to be placed “at the heart of recovery efforts,” particularly by “prioritizing schools in reopening plans.” UNICEF cited a series of worrying figures in support of Fore’s words. While the pandemic has taken a heavy toll on the elderly, children and adolescents under 20 make up 13 percent of the 71 million coronavirus cases reported in the 107 countries that provided age-specific data. In developing countries, projections show a 15 percent increase in child poverty. Six to seven million more children could suffer from malnourishment in 2020, an increase of 14 percent that could translate to more than 10,000 additional deaths per month, mainly in sub-Saharan Africa and South Asia.

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‘opinion corridor’

Sweden’s Failed Covid Strategy Leaves The Country Deeply Divided (Peroni)

Sweden, a bastion of welfare and one of the countries that scores highest on pretty much anything to do with the wellbeing of its inhabitants, seems to have woken up to a serious identity crisis.The choice to adopt and follow a COVID-19 strategy unlike any other in Europe has recently led to an extreme polarization in an otherwise rather homogenous public debate. Statistics prove beyond a shadow of doubt that the other Scandinavian countries, which enforced much stricter policies, have suffered considerably fewer losses. Sweden’s state epidemiologist Anders Tegnell, who firmly opposed face masks and believed that measures should rely only on the Swedish people’s sense of personal responsibility, enjoyed overwhelming support in the early phases of the crisis.

Fan pages, mostly on Facebook, counted tens of thousands of members. His face featured on T-shirts, gadgets and even a tattoo, worn on the arm by one of his proudest admirers. The alluring message that Sweden’s approach was right and everybody else’s self-isolation regime was hopelessly wrong reached well beyond the nation’s borders. In other European countries, staunch critics of lockdowns pointed at footage of happy, bare-faced Swedes hanging out in crowded bars as evidence that the draconian measures imposed elsewhere were an unnecessary violation of civil rights. The Swedish model became a symbol for anti-lockdown and no-mask movements across the world. But now, one year after the first cases of COVID-19 were detected in Scandinavia, the situation has changed dramatically.

Sweden’s Public Health Agency recently announced that several among its key figures have been granted police protection. Tegnell himself is currently enduring massive criticism and even death threats. In one instance, a citizen went so far as to argue that he should be “executed by a firing squad on live state television”. And yet, despite the fact that both King Carl XVI Gustaf and prime minister Stefan Löfven in December publicly acknowledged that the Swedish approach had failed, Tegnell has never retracted anything, let alone made an official apology. Until very recently, an astounding, near total lack of criticism, not only from public opinion but even from major opposition parties, characterised Sweden’s COVID. This might be due to the so-called åsiktskorridor (‘opinion corridor’). This is a Swedish concept meaning that the public debate tends to take place within certain limits, along an established path. Those who disagree, often choose not to speak out. They feel out of tune with the rest of society.

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Inevitable.

These Seven States Have Dropped All Covid-19 Restrictions (F.)

Oklahoma became the latest to lift virtually all Covid-19 restrictions on Thursday, bringing the total number of states that have chosen to fully reopen—despite warnings from public health officials—to seven, with a number of others also moving in that direction.

Oklahoma: Gov. Kevin Stitt (R) said he will be signing an executive order on Friday that will roll back his few remaining coronavirus restrictions, removing limits on events and public gatherings, as well as the state-wide mask mandate (the state averaged 643 cases and 23.9 deaths each day over the past week).

Wyoming: Gov. Mark Gordon (R) announced March 8 that the state would repeal its statewide mask mandate and allow “bars, restaurants, theaters and gyms to resume normal operations” on March 16, but stipulated face masks will remain mandatory inside the state’s schools (the state averaged 7,343 cases and 1.3 deaths each day over the past week).

Texas: The largest state to remove all restrictions, Gov. Greg Abbott (R) announced on March 2 that Texas would be nixing its mask mandate and allowing businesses to reopen “100%” this Wednesday, banning jurisdictions from implementing local mask mandates unless they meet certain hospitalization metrics (the state averaged 4,909 cases and 189.9 deaths each day over the past week).

Mississippi: Gov. Tate Reeves (R) also decided to drop the state’s mask mandate and all Covid-19 restrictions on March 2, with the limits lifted the next day (the state averaged 396 cases and 14.6 deaths each day over the past week).

Montana: Gov. Greg Gianforte (R) announced the end of Montana’s mask mandate on Feb. 12, removing the last of the state’s restrictions, though some local jurisdictions have kept face covering requirements in place (the state averaged 129 cases and 2 deaths each day over the past week).

North Dakota: The state opted not to renew its mask mandate, first enacted in November, when it expired in January 2021, ending North Dakota’s restrictions (the state averaged 78 cases and 0.4 deaths each day over the past week).

Iowa: Gov. Kim Reynolds (R) ended the last of the state’s restrictions, the mask mandate issued in November 2020, in early February (the state averaged 481 cases and 14.4 deaths each day over the past week).

All seven of the states that have fully reopened are run by Republican governors. A number of other states have also significantly rolled back restrictions this month, but haven’t gone as far as the above states in eliminating both statewide mask mandates and limits on businesses. Connecticut and West Virginia, for example, have both lifted limits on most businesses, but kept their mask mandates, with Connecticut Gov. Ned Lamont (D) noting: “This is not Texas, this is not Mississippi.” South Carolina has dropped some of its mandatory mask requirements, though the state never had a full mandate, and Arkansas Gov. Asa Hutchinson (R) said he will remove his state’s mask mandate if hospitalizations rates and test positivity is below a certain threshold when it’s set to end on March 31.

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“thromboembolic events.”

EU Investigates 30 Reports Of Blood-clotting Linked To AstraZeneca jab (RT)

The European Medicines Agency (EMA) said on Thursday that it was investigating after two people inoculated from the same batch of AstraZeneca Covid-19 vaccine died from blood clotting and several countries stopped using the jabs. The inquiry comes after Iceland, Norway, Denmark, Estonia, Lithuania, Luxembourg and Latvia all suspended their rollouts of the AstraZeneca vaccine over fears that they may induce blood clotting – known medically as “thromboembolic events.” “There is currently no indication that vaccination has caused these conditions, which are not listed as side effects with this vaccine,” the EMA said in a statement, adding that its own risk assessment committee was investigating the matter.


As of March 10, there were 30 cases of thromboembolic events reported out of the 5 million people to have received the AstraZeneca jab so far in the European Economic Area, the EMA said in an update on Thursday. The agency also stressed that the vaccine’s “benefits continue to outweigh its risks.” A 60-year-old woman in Denmark died from blood clotting after she received an AstraZeneca jab from batch ABV5300, Danish newspaper Jyllands-Posten reported on Thursday. On Wednesday, it was reported that a 49-year-old nurse in Austria who was vaccinated from the same batch died from multiple thrombosis 10 days after her jab. Another woman in Austria was hospitalized with a pulmonary embolism after she received one of the batch’s 1 million doses that were sent to 17 different EU countries.

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Drip.

New York Assembly Speaker Lays Groundwork For Cuomo Impeachment (JTN)

The speaker of New York’s state Assembly has asked that its Judiciary Committee begin an investigation into Gov. Andrew Cuomo, which would be the first in moving toward an impeachment of the Democratic governor. Speaker Carl Heastie, a Democrat, during a closed-door meeting strongly recommended launching the probe during a private meeting of select Assembly Democrats, and again during a meeting of the entire party conference, multiple sources told The New York Post. Heastie said the committee should examine the accusations that Cuomo groped and sexually harassed several female aides and his administration’s alleged cover-up of the total number of nursing home deaths from COVID-19, at least one of the sources told the newspaper.

The news report came after New York City Mayor Bill de Blasio on Thursday called for Cuomo, a fellow Democrat, to resign after a sixth woman accused him of sexual misconduct. “It is disgusting to me,” de Blasio said during a press conference. “He can no longer serve as governor. It’s as simple as that. Anna Ruch, a former Biden 2020 campaign worker, told The New York Times this month that the governor made unwanted sexual advances toward her after they met at a wedding in New York City in 2019. She also accused Cuomo, 63, of kissing her without her permission, even as she tried to pull away. Ruch said the encounter left her “confused and shocked and embarrassed.” Another accuser, Charlotte Bennett, a former Cuomo aide, alleges that the governor inquired about her sex life and asked her whether she would be amenable to a relationship with an older man.

And another former aide, Lindsey Boylan, said Cuomo “made inappropriate comments about her appearance, kissed her without her consent at the end of a meeting and once suggested they play strip poker while aboard his state-owned jet,” the Associated Press reported. Three more women have made similar allegations. The latest woman said the governor groped her last year at the executive mansion after she had called there to do some work. She said she was alone with the governor in the mansion when he “closed the door and allegedly reached under her blouse and began to fondle her,” a source told the Albany Times Union. The incident has not been corroborated.

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Where is the press? Where is AOC?

1000s Of Illegal Immigrant Children Penned In ‘Facilities Akin To Jails’ (JTN)

The Biden administration has reportedly penned thousands of illegal immigrant children in federal facilities following a massive surge of immigration at the southern U.S. border — a striking reversal from the anguished immigration rhetoric of the Biden-Harris campaign, which mourned it as a “national shame” when “children are locked away in overcrowded detention centers and the government seeks to keep them there indefinitely.” Immigration officials are reportedly holding more than 3,200 migrant children, many of them in “facilities akin to jails,” according to the New York Times. Multiple media outlets reported that many of the detained children were being held past the statutory deadline for such detainment, and in shelters that were originally built to house adults.

The detention crisis comes as border patrol agents have been contending with a major surge of illegal immigration activity along the southern border. According to U.S. Customs and Border Patrol’s most recent statistics, the U.S. Border Patrol logged 285,217 “encounters” at U.S. borders through January of fiscal year 2021. That’s roughly 70% of the total for all of fiscal year 2020 in just three months. The Border Patrol claimed last week that the agency is on track to arrest a “record number” of immigrant sex offenders this year. Agents in Laredo, Texas, meanwhile, have multiple times this month apprehended over one hundred illegal immigrants over short periods of time.

Much of the surge is likely driven by immigrants hoping the Biden administration will show leniency toward immigrants seeking entry into the country and/or asylum. During his presidential campaign, Biden famously criticized the Trump administration’s relatively tough immigration policy, vowing a more compassionate approach to dealing with both legal and illegal immigrants. The current mass detention of child immigrants, on the other hand, presents a sobering challenge to both the Biden administration and to immigration advocates who hoped for a major shift under Biden in how the U.S. deals with illegal entries across the southern border.

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CPI is of Course Complete Baloney, But

House Price Inflation in CPI is of Course Complete Baloney, But … (WS)

For most Americans, housing costs are the largest item in their budget, ranging from 30% to 60% of their total monthly spending. In its Consumer Price Index (CPI) for February, released yesterday, the Bureau of Labor Statistics reported that the costs of homeownership (which the BLS calls “Owner’s equivalent rent of residence”) have increased by just 2.0% from a year ago, and that rents (“rent of primary residence”) have increased by 2.0%. They’re the biggest items among the 211 items in the CPI basket and together account for about one-third of overall CPI. They play a huge role in CPI. So… Rent inflation of 2.0% year-over-year on average across the US might be roughly on target, from what I can see in other rental data. But homeowner’s inflation of just 2.0%, given the skyrocketing home prices? Ludicrous. In its latest release, the Case-Shiller National Home Price index jumped by 10.4%.


This discrepancy between home price increases and the CPI for homeowners – which has for years contributed to understating the overall CPI – is depicted in the chart of the Case-Shiller National Home Price Index (red line) and the CPI for “owner’s equivalent rent of residence” (black line). I set the homeowners CPI at 100 for January 2000 to match the Case-Shiller index, which is set by default at 100 for January 2000. This allows you to see the progression of both indices on the same axis. The “owner’s equivalent rent of residence” accounts for 24.2% of CPI. If it had increased by 10.4%, in line with the Case-Shiller index, instead of 2.0%, the overall CPI would have increased by 2.03 percentage points more. So add the 2.03 percentage points to the reported overall CPI increase of 1.7%. And the thus corrected overall CPI would have shot up by 3.7%!

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The real WWIII?

China Is Winning The Great 21st Century Tech War (Chang)

At the ongoing “Two Sessions” in Beijing, the Communist Party has publicly told us how it will accomplish its ambitious goal. If the Chinese ruling party succeeds, the rest of the 21st century will be painted only in shades of red. Fortunately, America is beginning to mobilize itself. Americans, however, need to act, immediately. Tech is the real arms race of our era. On March 5, at the annual meeting of the National People’s Congress, China’s rubber-stamp legislature, Premier Li Keqiang announced the 14th Five-Year Plan, which begins this year. China, pursuant to the plan, will increase spending 7% per year to achieve “major breakthroughs” in areas of “frontier technology.” Specifically, the country, will devote resources to artificial intelligence; quantum information; semiconductors; brain science; genomics and biotech; clinical medicine and health; and deep space, deep sea, and deep earth.


Moreover, Beijing is also talking about the Sci-Tech Innovation 2030 Agenda and the Long-Range Objectives Through the Year 2035. Officials are silent when it comes to Xi Jinping’s now-notorious Made in China 2025 initiative — the plan is on its face a violation of the country’s trade obligations — but there is no question that the effort remains underway nonetheless. China is going all-in on what Wang Zhigang, the head of the Ministry of Science and Technology, called the development of a “new ecology” for innovation. In that ecology, China has been able to lead the world in important areas, such as “unhackable” quantum communications. Moreover, the country is not far behind — if it is behind at all — in quantum computing and artificial intelligence.

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Glad I have a platform.

Journalists Start Demanding Substack Censor its Writers (Greenwald)

On Wednesday, I wrote about how corporate journalists, realizing that the public’s increasing contempt for what they do is causing people to turn away in droves, are desperately inventing new tactics to maintain their stranglehold over the dissemination of information and generate captive audiences. That is why journalists have bizarrely transformed from their traditional role as leading free expression defenders into the the most vocal censorship advocates, using their platforms to demand that tech monopolies ban and silence others. That same motive of self-preservation is driving them to equate any criticisms of their work with “harassment,” “abuse” and “violence” — so that it is not just culturally stigmatized but a banning offense, perhaps even literally criminal, to critique their journalism on the ground that any criticism of them places them “in danger.”

Under this rubric they want to construct, they can malign anyone they want, ruin people’s reputations, and unite to generate hatred against their chosen targets, but nobody can even criticize them. Any independent platform or venue that empowers other journalists or just ordinary citizens to do reporting or provide commentary outside of their repressive constraints is viewed by them as threats to be censored and destroyed. Every platform that enables any questioning of their pieties or any irreverent critiques of mainstream journalism — social media sites, YouTube, Patreon, Joe Rogan’s Spotify program — has already been systematically targeted by corporate journalists with censorship demands, often successfully.

Back in November, the media critic Stephen Miller warned: “It’s only a matter of time before the media tech hall monitors turn their attention to Substack.” And ever since, in every interview I have given about the success of Substack and every time I have written about journalist-led censorship campaigns, I have echoed that warning that they would soon turn their united guns on this platform. Miller’s prediction was prompted by a Columbia Journalism Review article entitled “The Substackerati” which claimed that Substack was structurally unfair because “most” of “the most successful people on Substack” are “white and male; several are conservative” and “have already been well-served by existing media power structures.”

All of that was false. The most-read and highest-earning writer on Substack is Heather Cox Richardson, a previously obscure Boston College History Professor who built her own massive readership without ever working at a corporate media outlet. And the writers that article identified in support of its claim — Matt Taibbi, Andrew Sullivan, Matt Yglesias and myself — do not remotely owe our large readerships to “existing media power structures.”

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“My grandfather would get home from work [and the family]… would sit around the dinner table, and have a conversation”, says Skoyles. “Nobody can be making money from that. Maybe they’d sit and listen to the radio…[which is]…something that’s already been paid for. Nobody can really be making any more money from that.”

The Golden Question — Time vs Money (Ren.)

In a capitalist society the pressure people have to do more, quickly, runs up against a number of problems. As Jan Skoyles acknowledges, the ‘time is money’ paradigm not only inhibits the creative process but, perhaps counter-intuitively, also undermines efficiency: “I think we see that often with governments”, says Skoyles. “They have a four or five year window. They think they have to achieve things quickly [but]…actually nothing’s really achieved in the end….We also have to think about how our time is becoming increasingly an economic activity…Even when we’re in our homes people can be using our time for their own financial gain.” Skoyles illustrates how much more economic value is extracted from the technologically more advanced societies of today compared to the traditional, stable ‘nuclear families’ of the past:

“My grandfather would get home from work [and the family]… would sit around the dinner table, and have a conversation”, says Skoyles. “Nobody can be making money from that. Maybe they’d sit and listen to the radio…[which is]…something that’s already been paid for. Nobody can really be making any more money from that. Now we’ll get home from work, we’ll sit around the table, we’ll hopefully have a conversation, but nine times out of ten someone’s got their phone out.” Consequently, data companies, advertisers, websites and Amazon are all making money [on the back of it]. “You’re constantly being advertised to and listened to and so our time is actually becoming increasingly valuable. But at the same time more and more decisions are being made for us which have a bigger impact”, claims Skoyles.

As the analyst acknowledges, with reference to Brexit, this comes with not only financial but also health costs: “People are stressed — that’s money in itself. So I think ‘time is money’ is definitely becoming more and more of an economic concept than I think it’s ever been.” A capitalist system that’s wrapped up in an ethos in which time and money increasingly overlap and which the notion of being busy is fetishized, imbues a sense of guilt for those who are not busy. Skoyles explains the phenomenon with reference to the ‘new mum’ perspective: “Everyone works more than an eight hour day. But if you had a full time job beforehand and then you go to looking after this little baby and it needs you, the fact that you’re focused on one thing — which to many people that’s the most important job in the world — but.. you feel quite guilty that that’s all you’ve been doing all day.”

Read more …

 

 

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fed chairs

 

 

 

 

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Nov 182017
 
 November 18, 2017  Posted by at 1:49 pm Finance Tagged with: , , , , , , , , ,  8 Responses »


Rembrandt van Rijn The Three Crosses 1653

 

John Rubino recently posted a graph from Bob Prechter’s Elliot Wave that points to some ominous signs. It depicts the S&P 500, combined with consumer confidence and savings rate. As the accompanying video at Elliott Wave, What “Too Confident to Save” Means for Stocks, shows, when the gap between high confidence and low savings is at its widest, a market crash -often- follows.

In 2000, the subsequent crash was 39%, in 2007 it was 54%. We are now again witnessing just such a gap, with the S&P 500 at record levels. Here’s the graph, with John’s comments:

 

Consumers Are Both Confident And Broke

Elliott Wave International recently put together a chart that illustrates a recurring theme of financial bubbles: When good times have gone on for a sufficiently long time, people forget that it can be any other way and start behaving as if they’re bulletproof. They stop saving, for instance, because they’ll always have their job and their stocks will always go up. Then comes the inevitable bust. On the following chart, this delusion and its aftermath are represented by the gap between consumer confidence (our sense of how good the next year is likely to be) and the saving rate (the portion of each paycheck we keep for a rainy day). The bigger the gap the less realistic we are and the more likely to pay dearly for our hubris.

 

 

John is mostly right. But not entirely. Not that I don’t think he knows, he simply forgets to mention it. What I mean is his suggestion that people stop saving because they’re confident, bullish. To understand where and why he slightly misses, let’s turn to Lance Roberts. Before we get to the savings, Lance explains why the difference between the Producer Price Index (PPI) and Consumer Price Index (CPI) is important to note.

Summarized, producer prices are rising, but consumer prices are not.

 

You Have Been Warned

There is an important picture that is currently developing which, if it continues, will impact earnings and ultimately the stock market. Let’s take a look at some interesting economic numbers out this past week. On Tuesday, we saw the release of the Producer Price Index (PPI) which ROSE 0.4% for the month following a similar rise of 0.4% last month. This surge in prices was NOT surprising given the recent devastation from 3-hurricanes and massive wildfires in California which led to a temporary surge in demand for products and services.

 

 

Then on Wednesday, the Consumer Price Index (CPI) was released which showed only a small 0.1% increase falling sharply from the 0.5% increase last month.

 

 

Such differences have real life consequences. In Lance’s words:

 

This deflationary pressure further showed up on Thursday with a -0.3% decline in Export prices. (Exports make up about 40% of corporate profits) For all of you that continue to insist this is an “earnings-driven market,” you should pay very close attention to those three data points above. When companies have higher input costs in their production they have two choices: 1) “pass along” those price increase to their customers; or 2) absorb those costs internally.

If a company opts to “pass along” those costs then we should have seen CPI rise more strongly. Since that didn’t happen, it suggests companies are unable to “pass along” those costs which means a reduction in earnings. The other BIG report released on Wednesday tells you WHY companies have been unable to “pass along” those increased costs.

The “retail sales” report came in at just a 0.1% increase for the month. After a large jump in retail sales last month, as was expected following the hurricanes, there should have been some subsequent follow through last month. There simply wasn’t. More importantly, despite annual hopes by the National Retail Federation of surging holiday spending which is consistently over-estimated, the recent surge in consumer debt without a subsequent increase in consumer spending shows the financial distress faced by a vast majority of consumers.

 

That already hints at what I said above about savings. But it’s Lance’s next graph, versions of which he uses regularly, that makes it even more obvious. (NOTE: I think he means to say 2009, not 2000 below)

 

The first chart below shows a record gap between the standard cost of living and the debt required to finance that cost of living. Prior to 2000(?!), debt was able to support a rising standard of living, which is no longer the case currently.

 

 

The cut-off point is 2009, unless I miss something in Lance’s comment. Before that, borrowing could create the illusion of a rising standard of living. Those days are gone. And it’s very hard to see, when you take a good look, what could make them come back.

Not only are savings not down because people are too confident to save, they are down because people simply don’t have anything left to save. The American consumer is sliding ever deeper into debt. And as for the Holiday Season, we can confidently -there’s that word again- predict that spending will be disappointing, and that much of what is still spent will add to increasing Consumer Credit Per Capita, as well as the Gap Between Real Disposable Income (DPI) And Cost Of Living.

The last graph, which shows Control Purchases, i.e. what people buy most, a large part of which will be basic needs, makes this even more clear.

 

With a current shortfall of $18,176 between the standard of living and real disposable incomes, debt is only able to cover about 2/3rds of the difference with a net shortfall of $6,605. This explains the reason why “control purchases” by individuals (those items individuals buy most often) is running at levels more normally consistent with recessions rather than economic expansions.

 

 

If companies are unable to pass along rising production costs to consumers, export prices are falling and consumer demand remains weak, be warned of continued weakness in earnings reports in the months ahead. As I stated earlier this year, the recovery in earnings this year was solely a function of the recovering energy sector due to higher oil prices. With that tailwind now firmly behind us, the risk to earnings in the year ahead is dangerous to a market basing its current “overvaluation” on the “strong earnings” story.

“Prior to 2009, debt was able to support a rising standard of living..” Less than a decade later, it can’t even maintain the status quo. That’s what you call a breaking point.

To put that in numbers, there’s a current shortfall of $18,176 between the standard of living and real disposable incomes. In other words, no matter how much people are borrowing, their standard of living is in decline.

Something else we can glean from the graphs is that after the Great Recession (or GFC) of 2008-9, the economy never recovered. The S&P may have, and the banks are back to profitable ways and big bonuses, but that has nothing to do with real Americans in their own real economy. 2009 was a turning point and the crisis never looked back.

Are the American people actually paying for the so-called recovery? One might be inclined to say so. There is no recovery, there’s whatever the opposite of that is, terminal decline?!. It’s just, where does that consumer confidence level come from? Is that the media? Is The Conference Board pulling our leg? Is it that people think things cannot possibly get worse?

What is by now crystal clear is that Americans don’t choose to not save, they have nothing left to save. And that will have its own nasty consequences down the road. Let’s raise some rates, shall we? And see what happens?!

One consolation: Europe, Japan, China are in the same debt-driven decline that Americans are. We’re all going down together. Or rather, the question is who’s going to go first. That is the only hard call left. America’s a prime candidate.

 

 

Nov 132014
 
 November 13, 2014  Posted by at 9:26 pm Finance Tagged with: , , , , , , ,  14 Responses »


Dorothea Lange Negro woman who has never been out of Mississippi July 1936

Looks I have to return to the deflation topic. I’m a bit hesitant about it, because the discussion always gets distorted by varying definitions and a whole bunch of semi-religious issues. The Automatic Earth has for many years said that an immense bout of deflation is inevitable because of global debt levels, and it’s all only gotten a lot worse since we first said that. Our governments and central banks have ‘fought’ deflation with more debt, and that was always the stupidest idea in human history. Or at least, most of us were stupid for believing it would work, or was even intended to.

Just so we don’t get into yet more confusion, i probably need to explain that the debt deflation we’re talking about here is not some subdivision like consumer inflation or price inflation or cookie inflation, those are just hollow and meaningless terms. Debt deflation is deflation caused by too much debt, and the deleveraging it must and will lead to. Deflation does not equal falling prices, those are merely an effect of it.

The reason this matters is that when you equate inflation and deflation with rising or falling prices, you’re not going to be able to know when you actually have deflation. Because prices can rise for all sorts of reasons. Inflation/deflation is the money/credit supply in an economy multiplied by the speed at which money is spent in that economy, the velocity of money.

It should be obvious that prices for some items can still rise, certainly initially, when deflation sets in. Producers that see less sales can try to raise prices for their remaining buyers. Basic necessities will always be needed. Governments can raise taxes. Rising/falling prices tell us only part of the story, and with a considerable time delay.

Ergo: rising/falling prices are a lagging factor, and if you look at them only, you will have missed the point where deflation has set in. What follows, obviously, is that you can’t measure deflation by looking at consumer prices (CPI) or production prices (PPI) numbers. You’d be way behind the curve. CPI and PPI tell you something, but they don’t tell what causes falling or rising prices. And that is a valuable thing to know.

I see even John Mauldin in this week’s The Last Argument of Central Banks talk about ‘good deflation’, but that doesn’t exist any more than cookie inflation, sorry, John. Prices for some items may fall due to innovation etc. while an economy booms, but if you call that deflation, you’ll miss what’s really deflation when it arrives.

Deflation is always bad. It either occurs when money/credit is so short that people can not get their hands on it no matter how hard and productive they work, and how much demand there is for their products, or it occurs when people are too poor, too much in debt or too reluctant to part with what they have.

In a deflation, people spend only what they absolutely must, provided even that they can afford to, which leads to large swaths of an economy being liquidated. Falling prices lead to falling wages lead to ever further falling prices lead to factory closings lead to more people who can’t afford to spend which leads to closings which leads to less spending which leads to faling prices etc. This continues until the debt has been deleveraged. Governments will lose tax revenue and raise taxes, but soon enough they will in quick succession disband and be replaced, rinse and repeat until even essential services can no longer be provided.

Until recently, a shrinking money/credit supply was very clearly not in the cards. Central banks have gone absolutely nuts in their stimulus plans, and this has artificially kept price levels up somewhat, though far less than they, and scores of ‘experts’ had hoped and expected. Now that game, too, is up. Japan went crazier than ever the other day out of fear that falling oil prices would sink consumer spending even more, but the US Fed has cut QE. That is an admission it has failed to do what it officially was supposed to, not the sign of triumph it’s made out to be, as in ‘the economy is doing so well, it doesn’t need our support anymore’.

Central banks have spent like maniacs, and consumer spending only keeps falling. Just ask Japan. And while you’re at it, ask them how entrenched deflation can become even in an economy that still has the benefit of growing world market to sell its products in. We won’t have any such benefit. The world has stopped growing, and there’s no massaging of numbers left strong enough to hide it. Not that it won’t be tried. As I said earlier this week, we now live in a world built on debt and propaganda.

Since QE and other ‘plans’ never reached the real economy, most nations’ money supplies have also either fallen or at best remained stagnant. We have the perfect set-up for deflation, and we therefore have deflation. It hasn’t reached the US yet, though we should be careful with that because the numbers being reported are notoriously flaky. But it has reached Europe and Asia. Which means the US is only a matter of time. And people, reluctantly, start taking notice. Steve Hochberg and Pete Kendall penned the following for Bob Prechter’s Elliott Wave:

Deflation Rearing its Ugly Head in Subtle and Not-So-Subtle Ways Around the Globe

According to the latest figures, deflation is now perched on China’s doorstep. In September, China’s consumer price index was up 1.6%, but its producer price index fell 1.8%. The CPI increase was its lowest since 2010. [..] in September, demand for electric power, a “bellwether for China economic activity,” fell 8.4% from the prior month, the second straight monthly decline.

“Deflation is the real risk in China,” stated the chief economist at a Hong Kong bank. In Europe, deflation is no longer a possible risk; it’s reality. In September, eleven of fifteen European Union members experienced lower goods prices, and the latest quarter-over-quarter Eurozone growth in real GDP is zero.

With Alice-in-Wonderland naiveté, U.S. financial media place the United States outside the risk of global deflation. Headlines talk of “Mild Inflation” and insist that the U.S. will gain “From Good Deflation.” On October 14, Bloomberg reported that consumer spending is strong enough “to steer the U.S. economy safely through the shoals of deteriorating global growth and the turbulent financial markets.” In early September, we stated that it was only a matter of time before economic weakness and deflation (which will be anything but good) jump the Atlantic and Pacific oceans and arrive in the U.S.

According to the U.S. Labor Department, real wages for full-time employees averaged $790 a week in the third quarter, about $1 less than in the third quarter of 2007. “There’s been no net gain for workers since 1999.” In recent months, spending has been uneven. Retail sales fell 0.3% in September. Most economists are baffled: “one of the great mysteries is why the U.S. has lacked inflation despite all the money being pumped into the economy.” A study by the St. Louis Fed finds that the answer is “a dramatic increase in the private sector’s willingness to hoard money instead of spend it.”

Note: the ‘hoarding meme’ is habitually used by economists, re: Bernanke and his Chinese savings glut, to point out situations which are more often than not characterized by people being too poor to spend, not sitting on anything at all. For economists, if people don’t spend, it must be because they save, never because they’re poor. I kid you not.

For years now, the Fed along with most economists have anticipated the imminent return of inflation, but it continues stubbornly subdued. This long-term chart above of the CPI shows a succession of lower highs since the early 1980s, as inflation turned into disinflation, which is on the cusp of leading to outright deflation. Some argue that the CPI is rigged to show milder levels of inflation, but the bottom graph shows the same steady move toward the zero line in the Personal Consumption Expenditures Index, an alternate inflation measure favored by the U.S. Fed.

When outright deflation hits, recognition of it will play an important role. Once its presence becomes widely observed, investors and the debt markets will belatedly take defensive action. Eventually, notes Conquer the Crash, “default and fear of default exacerbate the trend as it causes creditors to reduce lending. A downward ‘spiral’ begins feeding on pessimism just as the previous boom fed on optimism.”

Moving from theory to practice, we end up with our old friend Ambrose. Though he confuses inflation and consumer prices, and thinks they’re one and the same thing, he does have useful numbers:

Spreading Deflation Across East Asia Threatens Fresh Debt Crisis

Deflation is becoming lodged in all the economic strongholds of East Asia. It is happening faster and going deeper than almost anybody expected just months ago, and is likely to find its way to Europe through currency warfare in short order. Factory gate prices are falling in China, Korea, Thailand, the Philippines, Taiwan and Singapore. Some 82% of the items in the producer price basket are deflating in China. The figures is 90% in Thailand, and 97% in Singapore.

These include machinery, telecommunications, and electrical equipment, as well as commodities. Chetan Ahya from Morgan Stanley says deflationary forces are “getting entrenched” across much of Asia. This risks a “rapid worsening of the debt dynamic” for a string of countries that allowed their debt ratios to reach record highs during the era of Fed largesse. Debt levels for the region as a whole (ex-Japan) have jumped from 147% to 207% of GDP in six years.

These countries face a Sisyphean Task. They are trying to deleverage, but the slowdown in nominal GDP caused by falling inflation is always one step ahead of them. “Debt to GDP has risen despite these efforts,” he said. If this sounds familiar, it should be. It is exactly what is happening in Italy, France, the Netherlands, and much of the eurozone. Data from Nomura show that the composite PPI index for the whole of emerging Asia – including India – turned negative in September.

China itself is now one shock away from a deflation trap. Chinese PPI has been negative for 32 months as the economy grapples with overcapacity in everything from steel, cement, glass, chemicals, and shipbuilding, to solar panels. It dropped to minus 2.2% in October. The sheer scale of over-investment is epic.

The country funnelled $5 trillion into new plant and fixed capital last year – as much as Europe and the US combined – even after the Communist Party vowed to clear away excess capacity in its Third Plenum reforms. Old habits die hard. Consumer prices are starting to track factory prices with a long delay. Headline inflation dropped to 1.6% in October. This is so far below the 3.5% target of the People’s Bank of China that it looks increasingly like a policy mistake. Core inflation is down to 1.4%.

China has flirted with deflation before: during its banking crisis in the late 1990s, and again during the West’s dotcom recession from 2001-2002. Both episodes proved manageable. This time the level of debt is greater by orders of magnitude, with a large chunk in trusts, wealth products, and other parts of the shadow banking nexus, and a further $1.2 trillion in “carry trade” loans from Hong Kong.

Standard Chartered thinks total debt has reached 250% of GDP. This is roughly $26 trillion, the same size as the US and Japanese commercial banking systems put together, and therefore a headache for us all. Larry Brainard from Trusted Sources says China is sliding towards a European debt-compound trap. “It’s arithmetic.Deflation will kill you if you’re leveraged. It is just a question of how quickly. We don’t know how big the problem is because China is playing a game of three-card Monte and moving the debt to different buckets,” he said.

Asia is not yet in a full-blown currency war, but no country can stand idly by as neighbours dump toxic deflationary waste on their front lawn. Korea has threatened to force down the won, pari passu with the yen. The central bank of Taiwan has been intervening. These skirmishes are happening in a region of festering grievances and territorial disputes, with no Nato-style security structure – or for that matter EU-style soft governance – to damp down fires.

[Chinese] purchases of foreign bonds have dropped to zero, down from $35bn a month at the start of the year. The yuan has appreciated 22% against the yen since June, and 50% since mid-2012. It is up 12% against the euro since the early summer. China is in effect strapped to the rocketing dollar through its quasi-peg, increasingly a torture machine.

George Magnus from UBS says this cannot continue. “What is happening in the property market is the tip of the iceberg for the whole economy. China will have to resort to monetary reflation over the winter, and I think this will include a lower yuan. We are heading into a currency war,” he said.

We have the debt. And we recognize it. Still, the line politics and media feed us is that more debt can be a good thing, that we need more debt in order to attain what they like to call ‘escape velocity’ from the financial crisis caused by that same debt. Oil on fire.

We have the propaganda. We don’t always recognize it for what it is, but the, that’s the idea, isn’t it? It’s to make people think that things are not really what they really are. That we need to spend more public funds on saving banks, not saving people, or else armageddon. There’s hardly a news story left today that is not to an extent phrased by propaganda.

And now we have deflation. Which is not the falling prices, though they are a – delayed – symptom. Still, other symptoms are as valid, as nobody is spending. Mass unemployment in southern Europe is a symptom. West Texas oil at $74 dollars today is one. The Chinese economy, allegedly still growing at $7.5%, but at 250% debt-to-GDP, is another. Throw in 207% debt-to-GDP debt levels across southeast Asia.

With deflation becoming a daily topic in our propagandistic media, despite the fact that governments and central banks are vehemently allergic to it (for good reasons), rest assured that we are entering a next phase of the crisis. Just not one that they would like you to think we are. When debt starts being deleveraged for real, deflation cannot be avoided. And debt must be deleveraged, we can’t sit on it till Kingdom Come and keep adding more while we’re at it. That was never in the cards. And we’ve accumulated too much of it to ever outgrow it. We simply can’t sell or make enough iPhones to accomplish that. Or eat enough burgers, hard as we try.

Our world, our life, has been built on debt and propaganda for many years. They have kept us from noticing how poorly we are doing. But now a third element has entered the foundation of our societies, and it’s set to eat away at everything that has – barely – kept the entire edifice from crumbling apart. Deflation.

It’s time to check where your basic needs will come from when it becomes first harder and them impossible to obtain them from the sources you have been used to. And please, get out of debt. Debt during deflation is a cruel and unforgiving mistress. Think of deflation as a biblical plague.