Apr 252020
 


Jack Delano “Untitled” near Durham, North Carolina 1940

 

Wuhan Was The Fentanyl Capital Of The World. Then Coronavirus Hit (LAT)
‘Wuhan Plague’ Plaques Are Popping Up Around Atlanta (Vice)
Trump Owed Tens Of Millions To Bank Of China (Pol.)
Trump Doesn’t Owe Bank of China Money (Christopher Balding)
Small Business Owners Asked To Sign PPP Loans Without Forgiveness Pledge (IC)
Small Business Rescue Earned Banks $10 Billion In Fees (NPR)
People In Their 30s And 40s, Barely Sick With COVID19, Die From Strokes (WP)
South Dakota County Offers Drive-Through Covid-19 Testing Friday (Strong)
Nearly 60 New Coronavirus Cases Confirmed On Cruise Ship In Japan (R.)
China Pressured EU To Drop COVID19 Disinformation Criticism (R.)
US Weighs Taking Equity Stakes In US Energy Companies – Mnuchin (R.)
Economics Professor: Australia Would Be ‘Better Off’ Without Lockdown (DM)
Brazil Justice Minister Resigns Over Bolsonaro’s Investigations Meddling (IC)
Denver Health Execss Get Bonuses 1 Week After Workers Asked To Take Cuts (CBS)
Amazon To Be Fined €100K For Every ‘Non-Essential’ Delivery in France (RT)

 

 

Daily US coronavirus death toll down sharply in past 24 hours to 1,258, the lowest daily toll in the country in nearly three weeks: Johns Hopkins

4/24/20 – Top 12 State Cases
New York: 271,590
New Jersey: 102,196
Mass : 46,023
Illinois: 39,658
California: 39,254
Pennsylvania: 38,652
Michigan: 36,641
Florida: 30,174
Louisiana: 26,140
Connecticut: 23,921
Texas: 22,806
Georgia: 22,147

• “At least 30 New Yorkers ingested household cleaners in the 18 hours since the president suggested using it to fight #coronavirus”

• “The timing on the bleach stuff is interesting, since the DOJ started cracking down on MMS, the diluted form of bleach being sold as a miracle cure for any disease under the sun on social media… six days ago.”

 

 

Cases 2,845,858 (+ 100,389 from yesterday’s 2,745,469)

197,846
Deaths 191,791 (+ 6,055 from yesterday’s 185,156 )

 

 

 

From Worldometer yesterday evening -before their day’s close-

 

 

From Worldometer – NOTE: among Active Cases, Serious or Critical fell to 3%. Among Closed Cases, Deaths have fallen to 20%

 

 

From SCMP:

 

 

From COVID19Info.live: Note: Turkey, Russia, UK are the biggest risers

 

 

 

 

 

 

Keep it locked down.

Wuhan Was The Fentanyl Capital Of The World. Then Coronavirus Hit (LAT)

For drug traffickers interested in getting in on the fentanyl business, all roads once led to Wuhan. The sprawling industrial city built along the Yangtze River in east-central China is known for its production of chemicals, including the ingredients needed to cook fentanyl and other powerful synthetic opioids. Vendors there shipped huge quantities around the world. The biggest customers were Mexican drug cartels, which have embraced fentanyl in recent years because it is cheaper and easier to produce than heroin. But the novel coronavirus that emerged in Wuhan late last year before spreading across the planet has upended the fentanyl supply chain, causing a ripple effect that has cut into the profits of Mexican traffickers and driven up street drug prices across the United States.

Few industries — illicit or not — have been unscathed by the pandemic that has upended the global economy and killed more than 190,000 people worldwide. The narcotics trade, which relies on the constant movement of goods and people, has been stymied by lockdowns, travel bans and other efforts to contain the virus, according to government officials, academic researchers and drug traffickers. Mexican production of fentanyl and methamphetamine appears especially hard hit. Both drugs are made with precursor chemicals that are typically sent on planes or cargo ships from China, where despite U.S. pressure to ban them, they continue to be sold legally. That supply chain was shut down in January when authorities in Wuhan enacted a lockdown that forced residents to stay inside for more than two months.

In February, after a major manufacturer of the chemicals closed, vendors began posting apologies on the online sites where chemicals are typically sold, said Louise Shelley, a professor at George Mason University who tracks global fentanyl production. “They were saying: ‘We’re not producing or selling or shipping,’” she said.

Read more …

The headline says: “racist”. I like everything Winnie.

‘Wuhan Plague’ Plaques Are Popping Up Around Atlanta (Vice)

Racist plaques depicting Winnie the Pooh holding a bat with chopsticks have begun to pop up around Atlanta, and police have no leads as to who is responsible. The round, bronze and teal plaques bearing the words “Wuhan Plague,” referencing the Chinese city where the coronavirus originated, first appeared April 13 on an electrical box in Inman Park, according to Atlanta police. Another appeared three days later at a coffee shop in the neighborhood of Reynoldstown. The most recent incident occurred on April 18 at Atlanta’s Candler Park Market. Winnie the Pooh’s association with Chinese culture originated in 2013 when parody comparisons between the cuddly bear and Prime Minister Xi Jinping went viral on social media — and China then banned Pooh images.


The plaques appeared to be glued to the sites where they were posted. Hodgepodge Coffeehouse owner Kristle Rodriguez said her employees alerted her to the plaque at her site. Rodriguez said she immediately called the cops and the building’s landlord, who quickly removed the plaque. “The adhesive was still wet, meaning this happened late morning or early afternoon,” she wrote in a Facebook post Friday. “This isn’t amusing, funny, politically incorrect, edgy, or punk rock. This is super fucking gross and racist. There’s enough xenophobia and ignorance being spouted from this administration, we certainly don’t need street art reinforcing this shit.”

Read more …

Curious article, because it’s not true.

Trump Owed Tens Of Millions To Bank Of China (Pol.)

But Trump himself has taken on debt from China. In 2012, his real estate partner refinanced one of Trump’s most prized New York buildings for almost $1 billion. The debt included $211 million from the state-owned Bank of China — its first loan of this kind in the U.S. — which matures in the middle of what could be Trump’s second term. Steps from Trump Tower in Manhattan, the 43-story 1290 Avenue of the Americas skyscraper spans an entire city block. Trump owns a 30 percent stake in the property valued at more than $1 billion, making it one of the priciest addresses in his portfolio, according to his financial disclosures. Trump’s ownership of the building received a smattering of attention before and after his 2016 campaign.

But the arrangement with the Bank of China in 2012 has gone largely unnoticed. The questions surrounding Trump’s ties to the Bank of China come as his campaign is claiming that Biden would be a gift to the Communist country and America’s chief economic rival. After the first version of this article was published, the Bank of China issued a statement Friday evening stating that it sold its debt on the building weeks after the 2012 loan on the property. Vornado Realty Trust owns 70 percent of the building. “On November 7, 2012 several financial institutions including the Bank of China participated in a commercial mortgage loan of $950 million to Vornado Realty Trust,” said Peter Reisman, managing director and chief communications officer of Bank of China U.S.A.

“Within 22 days, the loan was securitized and sold into the [commercial mortgage-backed securities] market, as is a common practice in the industry. Bank of China has not had any ownership interest in that loan since late November 2012.”

Read more …

Balding explains.

Trump Doesn’t Owe Bank of China Money (Christopher Balding)

Let me explain the deal structure and why Trump doesn’t owe Bank of China money. First, Trump is a minority passive owner of a real estate trust. 30% so not nothing and he is the president but it isn’t even his company. He doesn’t manage it even before he became president 1/n

Second, the nitty gritty of the financing goes like this (and this is very common in general especially in real estate) assume Citibank agrees to lend the building $1 billion to refinance their loan in 2012. Rather than lend the entire $1 billion themselves, Citibank will 2/n

get on the phone to other banks to take a piece of the $1b they need to raise. Let’s assume in this case it was five banks of $400m, $200m, $200m, $100m, and $100m. In this case Bank of China is one of the $200m slots. They lend that company the $1b to refinance their other 3/n

loan. However, the banks aren’t done. They don’t want to make a 10 year loan on real estate when they make more money from fee and churn of debt securities. So right after they made they $1b loan, Citibank lawyers (I don’t know if it was Citibank just an example) are 4/n

Drafting offering documents to sell off different pieces of the entire $1b loan to investors. The $1b loan is not actually 5 different loans but 5 different injections into a special purpose vehicle that is capitalized with the loan capital from those banks. The SPV 5/n

Which will receive the annual payments then sells off pieces of the loan in say $10m or $25m increments to investors. The banks then receive all of their original loan back as the entire $1b is sold off piece by piece. Typically, banks will have capital out on these projects 6/n

Read more …

In the US, small is ugly.

Small Business Owners Asked To Sign PPP Loans Without Forgiveness Pledge (IC)

Randy George had never laid anyone off in his 20 years running his bakery and café in Middlesex, Vermont. But after Vermont Gov. Phil Scott shut down restaurants to slow the spread of the coronavirus, half of his sales disappeared virtually overnight. He’s had to put 28 of the staff of Red Hen Baking Co. on furlough. George decided to sign up for a loan through the Paycheck Protection Program, created by Congress’s CARES Act relief bill to help small business owners stay afloat. At first, the program was funded with $350 billion, an amount that ran out about two weeks after it began; Congress is now working on a deal to add another $320 billion.

The key feature of these loans, which are being run by the Small Business Administration, is that they are supposed to be entirely forgiven if an owner spends most of the money on payroll and doesn’t lay anyone off. The details of how that forgiveness will work, however, are far from clear, making some small business owners wary to use it at all. In bank loan contracts reviewed by The Intercept, owners have been asked to sign onto terms that said that “forgiveness may apply” or “all or part of the Loan may be forgiven” — releasing the banks from liability but giving business owners no contractual guarantee of loan forgiveness, or even guidance on how to comply with the rules or how to pursue it. One didn’t mention forgiveness at all. The application materials, which are produced on SBA letterhead, have even fewer details.

“Loan forgiveness will be provided for the sum of documented payroll costs, covered mortgage interest payments, covered rent payments, and covered utilities,” most applications read. No other information is offered about what “covered” means. The CARES Act contains some details about how these are defined, but it’s buried in an almost 900-page bill. And no concrete information has been given to small business owners about how they should go about getting their loans forgiven. Some owners were told that to gain forgiveness, they’d have to submit a request to their banks. Others were told that they have to go straight to the SBA. That’s left many people questioning whether the loans will indeed be converted to grants at all. “The keystone, the cornerstone of this program is not assured,” George said.

Read more …

Won’t surprise a single soul.

Small Business Rescue Earned Banks $10 Billion In Fees (NPR)

Banks handling the government’s $349 billion loan program for small businesses made more than $10 billion in fees — even as tens of thousands of small businesses were shut out of the program, according to an analysis of financial records by NPR. The banks took in the fees while processing loans that required less vetting than regular bank loans and had little risk for the banks, the records show. Taxpayers provided the money for the loans, which were guaranteed by the Small Business Administration. According to a Department of Treasury fact sheet, all federally insured banks and credit unions could process the loans, which ranged in amount from tens of thousands to $10 million. The banks acted essentially as middlemen, sending clients’ loan applications to the SBA, which approved them.


For every transaction made, banks took in 1% to 5% in fees, depending on the amount of the loan, according to government figures. Loans worth less than $350,000 brought in 5% in fees while loans worth anywhere from $2 million to $10 million brought in 1% in fees. For example, on April 7, RCSH Operations LLC, the parent company of Ruth’s Chris Steak House, received a loan of $10 million. JPMorgan Chase & Co., acting as the lender, took a $100,000 fee on the one-time transaction for which it assumed no risk and could pass through with fewer requirements than for a regular loan. In total, those transaction fees amounted to more than $10 billion for banks, according to transaction data provided by the SBA and the Treasury Department.

Read more …

As he used a needlelike device to pull out the clot, he saw new clots forming in real time around it.

People In Their 30s And 40s, Barely Sick With COVID19, Die From Strokes (WP)

Thomas Oxley wasn’t even on call the day he received the page to come into Mount Sinai Beth Israel Hospital in Manhattan. There weren’t enough doctors to treat all the emergency stroke patients, and he was needed in the operating room. The patient’s chart appeared unremarkable at first glance. He was male, no medications, no history of chronic conditions. He had been feeling fine, hanging out at home during the lockdown like the rest of America, when suddenly, he had trouble talking and moving the right side of his body. Imaging showed a large blockage on the left side of his head. Oxley gasped when he got to the patient’s age and covid-19 status: 44, positive.

The man was among several recent stroke patients in their 30s to 40s who were all infected with the virus. The median age for that type of severe stroke is 74. As Oxley, an interventional neurologist, began the procedure to remove the clot, he observed something he had never seen before. On the monitors, the brain typically shows up as a tangle of black squiggles – “like a can of spaghetti,” he said – that provide a map of blood vessels. A clot shows up as a blank spot. As he used a needlelike device to pull out the clot, he saw new clots forming in real time around it. “This is crazy,” he remembers telling his boss.

Reports of strokes in the young and middle-aged – not just at Mount Sinai but in many other hospitals in hard-hit communities – are the latest twist in our evolving understanding of the mysteries of covid-19. Even as the virus has infected nearly 2.8 million people worldwide and killed 195,000 as of Friday, its origins, biological mechanisms and weaknesses continue to elude top scientific minds. Once thought to be a pathogen that primarily attacks the lungs, it has turned out to be a much more formidable foe – affecting nearly every major organ system in the body.

Read more …

Small is beautiful. A lot of the solutions will have to come from communities.

South Dakota County Offers Drive-Through Covid-19 Testing Friday (Strong)

A health center in Stanley offered one of the first COVID-19 test drive through services in the state that did not require symptoms or pre-screening. As southern Mountrail County continues to be a hotspot for COVID-19, one medical center stepped up to offer free drive through testing without an appointment. At least 160 cars came through the testing site in Stanley from 10 a.m. to 2 p.m., with some holding as many as nine people who wanted to be tested. “We’re preparing probably to do between three and 400 tests,” said Dr. Rich Laksonen. Stanley is not in the southern part of the county, but Laksonen said the center wanted to help the state learn more about where the virus is spiking in the county.


“Being that we are the facility that services the count, we saw that need to determine where in Mountrail County these hotspots are located,” said Laksonen. Laksonen said they were compelled to drop restrictions on the site making it “no appointment, or symptoms necessary.” It’s one of the only in the state. “We also wanted our residents in northern Mountrial County to come in and get a test whether we have symptoms or not,” he said. Laksonen said the community was appreciative of the effort. Medical staff say it is too soon to tell how many will test positive. It will take 24 to 48 hours for the dozens of people that came out Friday to know their results.

Read more …

It’s fitting this should be in Japan again.

Nearly 60 New Coronavirus Cases Confirmed On Cruise Ship In Japan (R.)

Nearly 60 new cases of coronavirus infections were confirmed among crew members of an Italian cruise ship docked in Japan, domestic media reported on Saturday. With testing of all crew members now complete, the new number, reported by public broadcaster NHK, brings the total infections onboard the Costa Atlantica to around 150, roughly one quarter of the vessel’s 623 crew members. TV Asahi said 57 crew members tested positive. The infection cluster onboard the vessel docked in Nagasaki comes as hospitals are running out of beds in some parts of Japan, where the national tally of virus cases has risen above 12,800. Some 345 people have died.


Of those infected onboard the Costa Atlantica, only one crew member has been admitted to hospital, NHK said, while others remain on board, having shown slight or no symptoms. The vessel has been docked in Japan since February for repairs and maintenance after the pandemic prevented scheduled repairs in China. Nagasaki authorities had quarantined the vessel on arrival, and ordered its crew not to venture beyond the quay except for hospital visits. But prefecture officials said earlier this week that some of the crew had departed without their knowledge, and sought detailed information on their movements.

Read more …

And China refuses an international investigation.

China Pressured EU To Drop COVID19 Disinformation Criticism (R.)

China sought to block a European Union report alleging that Beijing was spreading disinformation about the coronavirus outbreak, according to four sources and diplomatic correspondence reviewed by Reuters. The report was eventually released, albeit just before the start of the weekend Europe time and with some criticism of the Chinese government rearranged or removed, a sign of the balancing act Brussels is trying to pull off as the coronavirus outbreak scrambles international relations. The Chinese Mission to the EU was not immediately available for comment and China’s Foreign Ministry did not immediately respond to faxed questions about the exchange. An EU spokeswoman said “we never comment on content or alleged content of internal diplomatic contacts and communication with our partners from another countries.”

Another EU official said that the disinformation report had been published as usual and denied any of it had been watered down. Four diplomatic sources told Reuters that the report had initially been slated for release on April 21 but was delayed after Chinese officials picked up on a Politico news report hat previewed its findings. A senior Chinese official contacted European officials in Beijing the same day to tell them that, “if the report is as described and it is released today it will be very bad for cooperation,” according to EU diplomatic correspondence reviewed by Reuters. The correspondence quoted senior Chinese foreign ministry official Yang Xiaoguang as saying that publishing the report would make Beijing “very angry” and accused European officials of trying to please “someone else” – something the EU diplomats understood to be a reference to Washington.

The four sources said the report had been delayed as a result, and a comparison of the internal version of the report obtained by Reuters and the final version published late Friday showed several differences. For example, on the first page of the internal report shared with EU governments on April 20, the EU’s foreign policy arm said: “China has continued to run a global disinformation campaign to deflect blame for the outbreak of the pandemic and improve its international image. Both overt and covert tactics have been observed.”

Read more …

Yeah, let’s buy us some shale.

US Weighs Taking Equity Stakes In US Energy Companies – Mnuchin (R.)

The U.S. government is considering taking equity stakes in U.S. energy companies as it seeks to help the nation’s oil and gas sector amid the coronavirus outbreak, Treasury Secretary Steven Mnuchin said on Friday. President Donald Trump, speaking at a White House event with Mnuchin, said he wants to help industry and suggested the federal government could buy fuel for the country in advance as well as purchase airline tickets in advance. “We’re looking at a whole bunch of alternatives,” Mnuchin said. “You can assume that’s one of the alternatives, but there’s many of them,” Mnuchin said, referring to possible equity stakes.


The oil sector has been hit hard by a dramatic drop in demand as the coronavirus has effectively shut down economies around the globe. “The energy business is very important to me, and we’re going to build it up. This really hurt the energy business as much as any other business because it totally knocked out – the supply kept coming,” Trump said. Trump helped negotiate a reduction in output from OPEC and other countries including Russia, but the move has not removed the market’s oversupply. The president encouraged Mnuchin to look at buying oil for later use. “The United States is the largest user of oil. We could buy oil at a great price into the future. That gives them the infusion they need, and we have oil at a great price into the future,” Trump said.

Read more …

Well, if you wait long enough… Meanwhile, there are no buyers for your products anyway, so why bother?

Economics Professor: Australia Would Be ‘Better Off’ Without Lockdown (DM)

An economics professor has been slammed as ‘cold’ and ‘heartless’ for suggesting Australia prioritised health over the economy by going into coronavirus lockdown. University of New South Wales Professor Gigi Foster sparked outrage from fellow panellists and other economic professors while answering questions about the impacts of shutdown measures on Q&A on Monday. Professor Foster suggested Australia hadn’t properly weighed up the economic consequences of tough restrictions introduced to reduce the death toll, and argued the ‘economy is about lives’ too. ‘What frustrates me is when people talk about the economic costs of the lockdown they often don’t think in detail in terms of counting lives,’ Professor Foster said.

‘Has anyone thought about how would you get a measure of the traded lives when we lock an economy down? What are we sacrificing in terms of lives? ‘Economists have tried to do that and we try to do that in currencies like the value of a statistical life. ‘If you do that kind of calculus you realise very quickly that even with a very, very extreme epidemic, in Australia, we are still potentially better off not having an economic lockdown in the first place because of the incredible effects that you see. ‘Not just in a short-run way but in many years to come.’ Her views prompted a shocked response from fellow panellists on the ABC program.


‘How can you say that?’ ACTU secretary Sally McManus fired back. ‘We’re avoiding what’s happened in the UK, what’s happening in the US, the idea of having our ICUs overrun, our healthcare workers dying as well is just the most horrible thought.’ ‘It’s horrible either way,’ Professor Foster replied. ‘The coronavirus has made the world awful. There’s absolutely no doubt about that. ‘In order to have a proper discussion about trade-offs, you need to think in terms of lives you’re giving up. ‘I know it’s invisible lives and difficult to imagine when we aggregate, for example, all of the health effects and the mental health effects and the effects of people right now who have illnesses other than COVID-19.’

Read more …

Moro is no Mother Teresa himself.

Brazil Justice Minister Resigns Over Bolsonaro’s Investigations Meddling (IC)

As the country slept Friday morning, far-right Brazilian President Jair Bolsonaro fired the Federal Police Director Maurício Valeixo, bringing to a head a long-simmering battle with Justice Minister Sergio Moro. Moro, in turn, promptly resigned — in a new, major episode of deepening chaos in Brazilian politics. The official notice firing the Federal Police head bears Moro’s digital signature, but in a press conference Friday morning, the outgoing justice minister claimed that he was not informed of the move and did not sign the document. This and other revelations made by Moro could serve as grounds for impeachment, if the Brazilian body politic can muster the political will to support such a drastic measure. Members of Congress are already gathering signatures for a congressional inquiry into Moro’s allegations.

In his press conference, Moro suggested that Bolsonaro removed Valeixo because the president opposed investigations being conducted by the Federal Police. “He was concerned about investigations underway in the Federal Supreme Court and that a change would also be opportune at the Federal Police,” Moro said of Bolsonaro’s thinking. Moro said Bolsonaro’s concerns were not a reasonable justification for firing Valeixo, but added that he nonetheless searched for “an alternative solution, to avoid a political crisis during a pandemic.” In the end, Moro said, “I understood that I could not set aside my commitment to the rule of law.”

Notably, the Federal Police are conducting several investigations that could impact Bolsonaro, his politician sons, and several members of their inner circle. Moro loomed large over Brazilian politics during the past several years, even before he accepted Bolsonaro’s offer to serve as justice minister. He was the judge at the center of the influential Operation Car Wash anti-corruption investigation that put former President Luiz Inácio Lula da Silva in prison, removing the popular politician from the 2018 presidential election and clearing the way for Bolsonaro’s victory. When he entered government, Moro was among the most popular political figures in the country and was seen as an important ally for Bolsonaro, but also as a potential rival in the 2022 elections.

The ex-judge’s standing, however, was seriously weakened after The Intercept began publishing an explosive series, in English and Portuguese, on malfeasance and potential illegal actions by Moro and Car Wash prosecutors. As a result of the series, Lula was eventually released from prison.

Read more …

Is there anything more American?

Denver Health Execss Get Bonuses 1 Week After Workers Asked To Take Cuts (CBS)

Top executives at Denver Health Medical Center received significant bonuses this month for their performance in 2019, ranging from $50,000 up to $230,000, one week after frontline hospital workers were asked to voluntarily take leave without pay or reduce their hours as the hospital dealt with the financial downturn resulting from the coronavirus pandemic. On April 3, Denver Health CEO Robin Wittenstein emailed hospital workers noting “the current situation will stress us financially.” She announced a hiring freeze and asked employees to voluntarily take leave without pay, use personal time off or reduce their normal work week.


“The goal is to reduce our total salary expense without the need to lay off employees or implement mandatory PTO/furloughs,” wrote Wittenstein. She said the hospital was also considering mandating workers to use their paid time off, mandatory leave without pay and other steps. “The goal is to avoid these extreme measures if at all possible,” she wrote. One week later, on April 10, Wittenstein and her executive staff saw their 2019 Management Incentive Plan bonuses deposited into their bank accounts.

Read more …

Macron pleasing the unions AND his small businesses.

Amazon To Be Fined €100K For Every ‘Non-Essential’ Delivery in France (RT)

Amazon will face a fine each time it delivers non-essential goods in France until it improves the safety conditions of its workers amid the Covid-19 pandemic. The company earlier closed its warehouses in protest. On Friday, an appeals court in Versailles, outside Paris, upheld last week’s ruling, which restricted Amazon’s French warehouses to only shipping IT products, health items, groceries and pet food until it ensures the safety of its workers. Jeff Bezos’ e-commerce giant was given 48 hours to comply with the ruling, and will be fined €100,000 ($108,020) for every delivery that doesn’t meet the court’s requirements.


On April 14, a court ruled that Amazon had failed to guarantee the safety of its workers amid the Covid-19 pandemic, and said that the company must submit an updated professional risk assessment before it can resume full operations. Amazon argued that it had already updated its work safety protocols and introduced disease-control measures to prevent its workers from being infected with the coronavirus. Following the ruling on April 14, the company completely shut down its French warehouses until Saturday.

Read more …

 

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Thanks for your generosity.

 

 

 

 

Trara Reade’s mom called Larry King in 1993.

 

 

 

Merkel is a chemist by trade. She understands a thing or two.

 

 

 

 

 

 

 

 

 

Support the Automatic Earth for your own good.

 

Apr 232020
 


Jack Delano Union Station, Chicago, Illinois 1943

 

Not a Black Swan but a Portent of a More Fragile Global System – Taleb (NYer)
Coronavirus Started Spreading In US Much Earlier Than Thought (CoD)
Coronavirus Study Points To Vast Number Of Cases Under Radar In China (SCMP)
How Does Coronavirus Kill? (ScienceMag)
Many Small Businesses Say Loans Won’t Get Them To Rehire (AP)
Congressional Democrats Do Little To Improve ‘Pathetic’ Coronavirus Deal (IC)
Trump Disagrees ‘Strongly’ With Georgia Reopening Shops (JTN)
HHS Secretary Alex Azar Waited For Weeks To Brief Trump (WSJ)
Azar Tapped Former Labradoodle Breeder To Lead US Pandemic Task Force (R.)
Cuomo Taps Bloomberg To Lead COVID-19 Contact “Tracing Army” (Gothamist)
Turkey PPE Supplier Doesn’t Have Enough Stock To Meet UK Order (Sky)
Coronavirus Upends Global Narcotics Trade (R.)
The Analogy Trap in Economic Policy (Eichengreen)
New York Times Revives its Role in Chinagate (Lauria)

 

 

• The US had +2,341 new deaths from coronavirus today, down from its record high yesterday, bringing the total US death toll to 47,659.

• New York had +661 new deaths, while New Jersey had +310, Massachusetts had +221, and three other states (CA, MI, CT) had over 100 new deaths. Only five states did not have a coronavirus death today.

• The US had nearly +30k new confirmed cases today, bringing the total to over 848k, with over 717k active cases.

 

• US total cases currently at 848,735, with death totals at 47,663.
• Globally, total cases have hit 2,637,414, with death totals at 184,204.

 

• US yesterday new 25,985, today now 27,948.
• IL, CT today exceed 2,000

 

• Spain yesterday 3,968, today 4,211. Fluctuating. No daily testing data

 

• 4/22/20 – Top 12 State Cases
New York: 257,216
New Jersey: 95,865
Massachusetts: 42,944
California: 35,396
Illinois: 35,108
Pennsylvania: 35,045
Michigan: 33,966
Florida: 28,309
Louisiana: 25,258
Connecticut: 22,469
Texas: 21,069
Georgia: 20,740

 

 

#Coronavirus: Global #Covid19 Deaths By Week
01/22: 17
01/29: 133
02/05: 564
02/12: 1,118
02/19: 2,122
02/26: 2,770
03/04: 3,254
03/11: 4,615
03/18: 8,733
03/25: 21,181
04/01: 46,809
04/08: 88,338
04/15: 134,177
04/22: 183,027

 

 

Cases 2,656,391 (+ 82,920 from yesterday’s 2,573,471)

Deaths 185,156 (+ 6,598 from yesterday’s 178,558)

 

 

 

From Worldometer yesterday evening -before their day’s close-

 

 

From Worldometer – NOTE: among Active Cases, Serious or Critical fell to 3%. Among Closed Cases, Deaths have fallen to 20%

 

 

From SCMP:

 

 

From COVID19Info.live: Note: Turkey, Russia, UK are the biggest risers

 

 

 

 

“The state,” he told me, “should not smooth out your life, like a Lebanese mother, but should be there for intervention in negative times, like a rich Lebanese uncle.”

Not a Black Swan but a Portent of a More Fragile Global System – Taleb (NYer)

COVID19 has initiated ordinary citizens into the esoteric “mayhem” that Taleb’s writings portend. Who knows what will change for countries when the pandemic ends? What we do know, Taleb says, is what cannot remain the same. He is “too much a cosmopolitan” to want global networks undone, even if they could be. But he does want the institutional equivalent of “circuit breakers, fail-safe protocols, and backup systems,” many of which he summarizes in his fourth, and favorite, book, “Antifragile,” published in 2012. For countries, he envisions political and economic principles that amount to an analogue of his investment strategy: government officials and corporate executives accepting what may seem like too-small gains from their investment dollars, while protecting themselves from catastrophic loss.

For Taleb, an antifragile country would encourage the distribution of power among smaller, more local, experimental, and self-sufficient entities—in short, build a system that could survive random stresses, rather than break under any particular one. (His word for this beneficial distribution is “fractal.”) We should discourage the concentration of power in big corporations, “including a severe restriction of lobbying,” Taleb told me. “When one per cent of the people have fifty per cent of the income, that is a fat tail.” Companies shouldn’t be able to make money from monopoly power, “from rent-seeking”—using that power not to build something but to extract an ever-larger part of the surplus.

There should be an expansion of the powers of state and even county governments, where there is “bottom-up” control and accountability. This could incubate new businesses and foster new education methods that emphasize “action learning and apprenticeship” over purely academic certification. He thinks that “we should have a national Entrepreneurship Day.” But Taleb doesn’t believe that the government should abandon citizens buffeted by events they can’t possibly anticipate or control. (He dedicated his book “Skin in the Game,” published in 2018, to Ron Paul and Ralph Nader.) “The state,” he told me, “should not smooth out your life, like a Lebanese mother, but should be there for intervention in negative times, like a rich Lebanese uncle.”

Right now, for example, the government should, indeed, be sending out checks to unemployed and gig workers. (“You don’t bail out companies, you bail out individuals.”) He would also consider a guaranteed basic income, much as Andrew Yang, whom he admires, has advocated. Crucially, the government should be an insurer of health care, though Taleb prefers not a centrally run Medicare-for-all system but one such as Canada’s, which is controlled by the provinces. And, like responsible supply-chain managers, the federal government should create buffers against public-health disasters: “If it can spend trillions stockpiling nuclear weapons, it ought to spend tens of billions stockpiling ventilators and testing kits.”

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This was a given.

Coronavirus Started Spreading In US Much Earlier Than Thought (CoD)

Experts have released new information about just how long the coronavirus (COVID-19) might have been silently spreading in the United States. Health officials in California said the first U.S. coronavirus deaths actually occurred weeks before they previously believed. This comes as no surprise to doctors. Many doctors had patients earlier on that they now believe were COVID-19 cases. But they didn’t qualify for testing at the time because they either didn’t have a history of travel to China or the didn’t have the initially reported symptoms of fever, cough and shortness of breath. But now there’s concrete proof that the timeline of cases started much earlier.

The first confirmed case of the coronavirus in the U.S. came Jan. 21 in a man from Washington state who developed symptoms after returning from a trip to Wuhan, China. But the first confirmed death was thought to be more than a month later, on Feb. 29, in Kirkland, Washington. Health officials there later found two deaths on Feb. 26 were due to the virus, pushing the timeline back three days. But coroners across the country are now looking back at other deaths. The medial examiner in Santa Clara County, California, sent tissue samples collected during autopsies performed in February to the Centers for Disease Control and Prevention for testing.

Samples taken from patients who died at home on Feb. 6 and Feb. 17 both tested positive for the coronavirus. That pushes the fatality timeline back 20 days. Health officials believe the patients were infected in the community. Neither is known to have a travel history. Given that deaths tend to lag infections by about two weeks, the first patient could have been infected in mid-January. It’s likely the coronavirus was already spreading in the U.S. far earlier than initially reported — hidden in a bad flu season and undetected by rigid testing rules.

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So people will say: see, infection rate is much lower! Well, not if the death rate is also much higher. Which certainly in China is possible.

Coronavirus Study Points To Vast Number Of Cases Under Radar In China (SCMP)

China’s official tally of coronavirus cases could have quadrupled in mid-February if one broader system for classifying confirmed patients had been used from the outset of the pandemic, according to researchers at the University of Hong Kong. In a study published in the medical journal The Lancet on Tuesday, the researchers said China might have had 232,000 confirmed cases – rather than the official total of about 55,000 – by February 20 if a revised definition adopted earlier in the month had been applied throughout. “We estimated that there were at least 232,000 infections in the first epidemic wave of Covid-19 in mainland China,” they said, referring to the disease caused by the coronavirus.

“The true number of infections could still be higher than that currently estimated considering the possibility of under-detection of some infections, particularly those that were mild and asymptomatic, even under the broadest case definitions.” The researchers – led by Peng Wu from the University of Hong Kong’s school of public health – looked at the various classification systems used by the government after the epidemic erupted in the central Chinese city of Wuhan in late December. China has published seven editions of diagnosis and treatment guidelines, changing the classification system as understanding of the disease developed. The Hong Kong team found that different definitions made a big difference to the number of cases.

“We estimated that when the case definitions were changed from version 1 to 2, version 2 to 4, and version 4 to 5, the proportion of infections being identified as Covid-19 cases was increased by 7.1 times from version 1 to 2, 2.8 times from version 2 to 4, and 4.2 times from version 4 to 5,” the paper, co-authored by Peng’s HKU colleagues epidemiologist Benjamin Cowling and medical faculty dean Gabriel Leung, said.

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Thorough report on how and why. But even then a lack of understanding of what the virus is, remains.

How Does Coronavirus Kill? (ScienceMag)

When an infected person expels virus-laden droplets and someone else inhales them, the novel coronavirus, called SARS-CoV-2, enters the nose and throat. It finds a welcome home in the lining of the nose, according to a preprint from scientists at the Wellcome Sanger Institute and elsewhere. They found that cells there are rich in a cell-surface receptor called angiotensin-converting enzyme 2 (ACE2). Throughout the body, the presence of ACE2, which normally helps regulate blood pressure, marks tissues vulnerable to infection, because the virus requires that receptor to enter a cell. Once inside, the virus hijacks the cell’s machinery, making myriad copies of itself and invading new cells.

As the virus multiplies, an infected person may shed copious amounts of it, especially during the first week or so. Symptoms may be absent at this point. Or the virus’ new victim may develop a fever, dry cough, sore throat, loss of smell and taste, or head and body aches. If the immune system doesn’t beat back SARS-CoV-2 during this initial phase, the virus then marches down the windpipe to attack the lungs, where it can turn deadly. The thinner, distant branches of the lung’s respiratory tree end in tiny air sacs called alveoli, each lined by a single layer of cells that are also rich in ACE2 receptors.

Normally, oxygen crosses the alveoli into the capillaries, tiny blood vessels that lie beside the air sacs; the oxygen is then carried to the rest of the body. But as the immune system wars with the invader, the battle itself disrupts this healthy oxygen transfer. Front-line white blood cells release inflammatory molecules called chemokines, which in turn summon more immune cells that target and kill virus-infected cells, leaving a stew of fluid and dead cells—pus—behind. This is the underlying pathology of pneumonia, with its corresponding symptoms: coughing; fever; and rapid, shallow respiration. Some COVID-19 patients recover, sometimes with no more support than oxygen breathed in through nasal prongs.

But others deteriorate, often quite suddenly, developing a condition called acute respiratory distress syndrome (ARDS). Oxygen levels in their blood plummet and they struggle ever harder to breathe. On x-rays and computed tomography scans, their lungs are riddled with white opacities where black space—air—should be. Commonly, these patients end up on ventilators. Many die. Autopsies show their alveoli became stuffed with fluid, white blood cells, mucus, and the detritus of destroyed lung cells.

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All the big money’s already been handed out.

Many Small Businesses Say Loans Won’t Get Them To Rehire (AP)

Some small businesses that obtained a highly-coveted government loan say they won’t be able to use it to bring all their laid-off workers back, even though that is what the program was designed to do. The Paycheck Protection Program promises a business owner loan forgiveness if they retain or rehire all the workers they had in late February. But owners say the equation isn’t so simple, in part because of current economic conditions and partly due to the terms of the loans. As a result, the lending may not reduce unemployment as much as the Trump administration and Congress hope. The government’s $2 trillion relief package included $349 billion for the small business loan program, which was besieged with applications and ran out of money Thursday.

Congress and the White House reached a deal Tuesday that would provide another $310 billion. To get the loans forgiven, companies need to spend 75% on payroll within eight weeks of receiving the money. The other 25% can be spent on rent, utilities, and mortgage payments. Otherwise, the loan has generous terms: Only a 1% interest rate and six months before any principal is due. Many of the small companies that were able to obtain a loan are having second thoughts about rehiring all their workers and a few plan to return the money. Others will use what they can on rent and utilities, and will use some to rehire a portion of their laid-off staff. But most are unsure they will be able to reopen eight weeks from now.

They see little point in rehiring all their workers, paying them to do little or nothing, and then potentially laying them off again if business remains weak two months from now. “You’re turning the business into a pass through for the federal government,” said Joe Walsh, who owns Clean Green Maine, a cleaning service in Portland, Maine with 35 employees. “You’re doing very little to actually help the business.” [..] Also, the generous unemployment aid that was also included in the government’s relief package has made it more difficult to rehire. Many workers are making more with unemployment checks, which now include a $600 weekly benefit from the federal government.

Walsh, who received a $280,000 loan from the SBA, said that he is reluctant to push his employees to return to work because, under unemployment benefit rules, they could lose their weekly checks if they turn down potential jobs. “That’s just putting me as the employer in a really difficult position,” Walsh said. He pays at least $17 an hour, with benefits, but his former employees are getting the equivalent of roughly $25 an hour from unemployment.

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They all have the same campaign contributors. And they’re not small businesses.

Congressional Democrats Do Little To Improve ‘Pathetic’ Coronavirus Deal (IC)

PROGRESSIVE GROUPS are outraged with the nearly $500 billion interim coronavirus rescue package the Senate passed on Tuesday, urging House Democrats to oppose the “pathetic” deal they say doesn’t come close to providing the relief vulnerable people need while giving away all Democratic leverage for future legislation. The “Phase 3.5” bill, which is expected to sail through the House this week, left out almost everything Democratic leaders were advocating for. There’s no additional funding for state and local governments, no expanded food stamp benefits, no hazard pay for front-line workers, nor money for the U.S. Postal Service, which had all been basic Democratic priorities.

The lack of progressive opposition in Congress has been especially noteworthy, after members of the progressive caucus promised to help make future legislation more comprehensive following the hastily passed Phase 3 bill. While some progressive advocates argue that Democrats didn’t have much leverage on the package to begin with, others note that Democrats control the House and House Speaker Nancy Pelosi could have led the party to pass its own bill. “Just as importantly as the inadequate policy provisions, this bill gives away all Democratic leverage,” Ezra Levin, co-executive director of Indivisible, said in an emailed statement.

“We fought so hard to win back the House in 2018 — to make sure that we had a voice in negotiations like this. So far we’ve heard silence from the House. This bill may be our last chance to get the things we need. [Republican Senate Majority Leader] Mitch McConnell has already said he doesn’t want to push through another bill, and if he does, it won’t be for weeks.” [..] The interim package, which would replenish funds for an emergency small business lending program, also includes an additional $75 billion for hospitals and $25 billion for coronavirus testing — two necessities that have been framed as GOP concessions. House Majority Leader Steny Hoyer said the legislation is everything they were expecting. “When you look at the package that is going to be passed, it’s almost exactly like the one we asked for two weeks ago, or 12 days ago,” he told reporters on Tuesday.

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It takes 2 weeks for new infections to occur. By then, most of the US will have reopened.

Trump Disagrees ‘Strongly’ With Georgia Reopening Shops (JTN)

President Trump said he disagreed with Georgia’s decision to allow some shops to re-open as early as Friday after shuttering due to the coronavirus pandemic. “I told the governor of Georgia, Brian Kemp, that I disagree strongly with his decision to open certain facilities which are in violation of the Phase 1 guidelines for the incredible people of Georgia,” Trump said Wednesday during a press conference of the White House Coronavirus Task Force. “But at the same time, he must do what he thinks is right. I want him to do what he thinks is right. But I disagree with him on what he’s doing.” Trump said he wanted to give governors discretion, although he would step in if he sees something “totally egregious, totally out of line.”

Trump’s administration last week released a 3-phase set of guidelines to re-open following the worst of the pandemic. Trump said that these Georgia shops shouldn’t be re-opening during the federal phase 1 guidelines and should instead wait for phase 2. “We’re going to have phase 2 very soon,” Trump said. “It’s just too soon. I think it’s too soon. And I love the people. I love those people that use all of those things, the spas, and the beauty parlors, barber shops, tattoo parlors. I love ’em. But they can wait a little bit longer, just a little bit. Not much. Because safety has to predominate. We have to have that. So I told the governor very simply that I disagree with his decision, but he has to do what he thinks is right.”

[..] 46% of registered U.S. voters want decisions about re-opening the country after the coronavirus to be made by state and local officials. Only 15% think it should be a federal decision, according to the Just the News Daily Poll with Scott Rasmussen. Trump praised Gov. Gavin Newsom (D-Calif.) for his re-opening strategy. “Some of the governors have done a fantastic job working with us,” Trump said.

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Sidelined a little too late perhaps?

HHS Secretary Alex Azar Waited For Weeks To Brief Trump (WSJ)

On Jan. 29, Health and Human Services Secretary Alex Azar told President Trump the coronavirus epidemic was under control. The U.S. government had never mounted a better interagency response to a crisis, Mr. Azar told the president in a meeting held eight days after the U.S. announced its first case, according to administration officials. At the time, the administration’s focus was on containing the virus. When other officials asked about diagnostic testing, Dr. Robert Redfield, director of the Centers for Disease Control and Prevention, began to answer. Mr. Azar cut him off, telling the president it was “the fastest we’ve ever created a test,” the officials recalled, and that more than one million tests would be available within weeks.

That didn’t happen. The CDC began shipping tests the following week, only to discover a flaw that forced it to recall the test from state public-health laboratories. When White House advisers later in February criticized Mr. Azar for the delays caused by the recall, he lashed out at Dr. Redfield, accusing the CDC director of misleading him on the timing of a fix. “Did you lie to me?” one of the officials recalled him yelling. Six weeks after that Jan. 29 meeting, the federal government declared a national emergency and issued guidelines that effectively closed down the country. Mr. Azar, who had been at the center of the decision-making from the outset, was eventually sidelined.

Many factors muddled the administration’s early response to the coronavirus as officials debated the severity of the threat, including comments from Mr. Trump that minimized the risk. But interviews with more than two dozen administration officials and others involved in the government’s coronavirus effort show that Mr. Azar waited for weeks to brief the president on the threat, oversold his agency’s progress in the early days and didn’t coordinate effectively across the health-care divisions under his purview.

[..] White House officials say there is no plan to replace Mr. Azar during a pandemic. Still, the president last week installed a former campaign aide, Michael Caputo, to serve as assistant secretary for public affairs at HHS. The White House also appointed policy adviser Emily Newman as a liaison to HHS who will oversee the agency’s political hires. Mr. Azar has largely been sidelined over the past several weeks from discussions with the president and with the White House task force, administration officials said. He hasn’t attended the daily briefing since April 3.

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The headline is just too good.

Azar Tapped Former Labradoodle Breeder To Lead US Pandemic Task Force (R.)

On January 21, the day the first U.S. case of coronavirus was reported, the secretary of the Department of Health and Human Services appeared on Fox News to report the latest on the disease as it ravaged China. Alex Azar, a 52-year-old lawyer and former drug industry executive, assured Americans the U.S. government was prepared. “We developed a diagnostic test at the CDC, so we can confirm if somebody has this,” Azar said. “We will be spreading that diagnostic around the country so that we are able to do rapid testing on site.” While coronavirus in Wuhan, China, was “potentially serious,” Azar assured viewers in America, it “was one for which we have a playbook.”

Azar’s initial comments misfired on two fronts. Like many U.S. officials, from President Donald Trump on down, he underestimated the pandemic’s severity. He also overestimated his agency’s preparedness. As is now widely known, two agencies Azar oversaw as HHS secretary, the Centers for Disease Control and Prevention and the Food and Drug Administration, wouldn’t come up with viable tests for five and half weeks, even as other countries and the World Health Organization had already prepared their own. Shortly after his televised comments, Azar tapped a trusted aide with minimal public health experience to lead the agency’s day-to-day response to COVID-19.

The aide, Brian Harrison, had joined the department after running a dog-breeding business for six years. Five sources say some officials in the White House derisively called him “the dog breeder.” Azar’s optimistic public pronouncement and choice of an inexperienced manager are emblematic of his agency’s oft-troubled response to the crisis. His HHS is a behemoth department, overseeing almost every federal public health agency in the country, with a $1.3 trillion budget that exceeds the GDP of most countries. [..[ Azar and his top deputies oversaw health agencies that were slow to alert the public to the magnitude of the crisis, to produce a test to tell patients if they were sick, and to provide protective masks to hospitals even as physicians pleaded for them.

The first test created by the CDC, meant to be used by other labs, was plagued by a glitch that rendered it useless and wasn’t fixed for weeks. It wasn’t until March that tests by other labs went into production. The lack of tests “limited hospitals’ ability to monitor the health of patients and staff,” the HHS Inspector General said in a report this month. The equipment shortage “put staff and patients at risk.” A promised virus surveillance program failed to take root, despite assurances Azar gave to Congress. Rather than share information, three current and three former government officials told Reuters, Azar and top staff sidelined key agencies that could have played a higher-profile role in addressing the pandemic. “It was a mess,” said a White House official who worked with HHS.

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Little Mike mighty actually pull it off. But he doesn’t care too much about privacy.

Cuomo Taps Bloomberg To Lead COVID-19 Contact “Tracing Army” (Gothamist)

Michael Bloomberg has been charged with amassing and leading a “tracing army” to track the spread of COVID-19 in the Tri-State area, according to Governor Andrew Cuomo. The goal will be to aggressively test and isolate contacts of all those who tested positive for the virus — a major undertaking that experts say is necessary before officials can consider relaxing social distancing measures. After previewing this push in recent weeks, Cuomo revealed during a press conference on Wednesday that Bloomberg will “coordinate the entire effort,” including developing the program and designing the training for thousands of newly-hired tracers.

The multibillionaire former mayor, who does not have a public health background, has also agreed to contribute $10 million to the initiative. By comparison, he spent $1 billion on his failed presidential bid. The announcement came hours after Mayor Bill de Blasio unveiled his own plans for a citywide contact tracing apparatus. The mayor was not informed by the Governor’s Office that Bloomberg, his predecessor and political rival, would be heading up the statewide effort until Wednesday morning, as de Blasio was announcing his own initiative, mayoral spokesperson Freddi Goldstein told Gothamist. While the city will still be responsible for hiring some of the field workers, Cuomo stressed that the initiative had to be regionally focused.

“You cannot trace someone within the boundaries of New York City,” he said. The state will also partner with Johns Hopkins University and the non-profit Vital Strategies to roll out the program. Some of the roughly 35,000 CUNY and SUNY students in medical fields will also be tapped for the effort, Cuomo said. The federal government has made available $1.3 billion for New York to begin contact tracing. Cuomo did not immediately have an estimate for how much it would cost. “You don’t have months to get this up and running,” he added. “You have weeks.”

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Turkey is one of the exploding countries. Is it a good ide to export their supplies?

Turkey PPE Supplier Doesn’t Have Enough Stock To Meet UK Order (Sky)

A commercial supplier in Turkey did not have enough stock to fulfil an order for 84 tonnes of protective equipment supposed to be bound for the UK, Turkish officials have said. British sources said the UK government was working with the company and the Turkish authorities to secure the shipment “as soon as possible” – though no time frame was given. It comes as a flight carrying PPE – urgently needed by front line health workers as they treat COVID-19 patients in the UK – arrived from Turkey, following days of delays. The Royal Air Force plane arrived at Brize Norton in Oxfordshire from Istanbul just after 3am.


The total consignment of 84 tonnes includes 400,000 clinical gowns, but it is not clear how much of this is on today’s flight. An initial batch of just 2,500 gowns was sent to the airport in Istanbul for quality control checks on Tuesday. Turkish officials said Britain’s attempt to buy the protective equipment from a Turkish firm ran into trouble because the supplier did not have enough stock. Turkey’s ambassador to the UK, Umit Yalcin, told Sky News: “As far as I understand there have been problems with the private supplier company. “Now Turkey is cooperating with the UK authorities to find a quick solution for the UK’s urgent needs.

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Support your local dealer.

Coronavirus Upends Global Narcotics Trade (R.)

Countries around the world have spent billions of dollars bailing out businesses affected by the coronavirus outbreak. Peru’s coca farmers, who grow the bushy plant used to make cocaine, say they want help, too. Prices for coca leaves sold to drug gangs have slumped 70% since Peru went on lockdown last month, according to Julián Pérez Mallqui, the head of a local growers’ organization. He said his members cater to Peru’s tightly regulated legal coca market, but acknowledged some growers sell on the black market. Peruvian officials say more than 90% of the country’s coca crop goes to traffickers who are now struggling to move product. With the sector in turmoil, Pérez’s group is crafting a plan to ask the government to buy up excess coca inventory.

Peru “has to design clear intervention strategies for coca,” Pérez said. “We’re screwed, just like everyone else in the world.” A spokesman for Peru’s anti-drugs agency said it may funnel more development aid to hard-hit areas. The coronavirus outbreak has upended industries across the globe. The international narcotics trade has not been spared. From the cartel badlands along the U.S.-Mexico border and verdant coca fields of the Andes, to street dealers in London and Paris, traffickers are grappling with many of the same woes as legitimate businesses, Reuters has found. On three continents, Reuters spoke with more than two dozen law enforcement officials, narcotics experts, diplomats and people involved in the illicit trade.

They described a business experiencing busted supply chains, delivery delays, disgruntled workers and millions of customers on lockdown. They also gave a window into the innovation – and opportunism – that are hallmarks of the underworld. [..] coronavirus has managed to do what authorities worldwide have not: slow the global narcotics juggernaut almost overnight and inflict a measure of pain on all who participate. In Mexico, the Sinaloa Cartel has faced many threats over the years, including the jailing of former leader Joaquin “El Chapo” Guzman. But never one like the coronavirus pandemic.

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“The task for now is income maintenance — targeting public support at the unemployed so that parents can feed their children.”

The Analogy Trap in Economic Policy (Eichengreen)

Where comparisons with past crises have value is precisely in highlighting how this crisis is different, and therefore how the policy response should vary. First, this crisis did not originate in the financial system, in contrast to 1929 and 2008. Flooding financial markets with liquidity, as central banks have done, may prevent problems on the real side of the economy from destabilising financial institutions and markets. But doing so will not mend the economy or even halt its downward spiral. Achieving this requires first containing the pandemic. Second, in contrast to these earlier episodes, major fiscal stimulus packages are not the right policy focus. Unlike in the past, we have also experienced an unprecedented supply shock.

It makes no sense to try to sustain demand at earlier levels at a time when production can’t keep up, since it is not yet safe — and won’t be safe for some time — for people to return to work. The time for demand stimulus is later. The task for now is income maintenance — targeting public support at the unemployed so that parents can feed their children. Third, this crisis will be most acute in low-income countries. These countries have weak health systems. They are being hit by weak commodity prices, falling remittances, capital flight, a shortage of trade credit and collapsing currencies all at once. They were not the focus in 1929 or 2008 because those crises centred on the global financial system, and because low-income countries had only rudimentary financial systems and were not integrated financially.

This time, low-income countries are at risk of a crisis that will dwarf anything in the advanced-country world. Addressing their plight should be priority number one on humanitarian grounds, but also because what happens there will spill back onto the rest of the world through both economic and epidemiological channels. With the IMF and World Bank meetings coming up next week, one wonders whether advanced countries will look beyond their domestic concerns. One worries that their preoccupation with the questions ‘is this downturn more serious than the Global Financial Crisis?’ and ‘could unemployment rise as high as in the Great Depression?’ will cause them to lose sight of what is about to become the most serious crisis of all.

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Yeah, before you know it you’re trapped with the NYT in your corner.

New York Times Revives its Role in Chinagate (Lauria)

During the saga of Russiagate The New York Times was the main vehicle for unnamed U.S. intelligence officials to filter uncorroborated allegations about Russia, presenting them as proven fact. Just as the Democratic Party attempted to shift the blame from its disastrous 2016 loss to Donald Trump onto Russia, the Trump administration is now trying to shift the blame from Trump’s disastrous handling of the Coronavirus crisis onto China. And The New York Times is once again the vehicle. In a front-page story on Wednesday, the Times reports as flat fact that “Chinese agents helped spread messages to millions of Americans about a fake lockdown last month, sowing virus panic in the U.S., officials said.” One of the messages said Trump would lock down the entire nation. “They will announce this as soon as they have troops in place to help prevent looters and rioters.”

But as in the Times‘ sordid history of numerous Russiagate stories, you have to read deep into the piece, in this case to paragraph seven, before you are told: “The origin of the messages remains murky. American officials declined to reveal details of the intelligence linking Chinese agents to the dissemination of the disinformation, citing the need to protect their sources and methods for monitoring Beijing’s activities.” Any reputable journalism school will teach its students that you hold off publishing until you see the evidence underlying an assertion. This is especially true when quoting anonymous sources. And it is doubly true when these sources are intelligence agents, who have a long history of deception. It is part of their job description.

Reporters should by now be wary and demand proof after they had allowed intelligence officials to misuse them in misleading the public about the reasons to invade Iraq, and indeed about the later proven lies about collusion between the Trump campaign and Russia. The Times story on Wednesday rather shamelessly revives and links China’s alleged misdeeds to Russiagate. “American officials said China, borrowing from Russia’s strategies, has been trying to widen political divisions in the United States. As public dissent simmers over lockdown policies in several states, officials worry it will be easy for China and Russia to amplify the partisan disagreements.”

Read more …

 

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Apr 222020
 


Saul Leiter Man in straw hat 1955

 

 

 

The following was written by Bruce Wilds, who runs the Advancing Time blog. Bruce is a small business owner in the Midwest.

I get lots of articles sent to me, but hardly ever publish any (sorry I can’t send everyone a reply) because they’re not what I think this site should be. But with this article it’s different. I think what Bruce describes is interesting, important even. The US has been losing small businesses for a long time, and the virus response is set to greatly accelerate the process. The huge stimulus plans will bypass most small businesses, because they are too small for governments to know what to do with.

The article was written before the latest round of handouts, but there’s very little reason to believe it will change much of anything. It’s not so much a grand plan or conspiracy, it just that the system has come to recognize only that bigger is better. America doesn’t like small. This is as true for banks as it is for various levels of government. But small businnesses have not only built the country, and are crucial for the faces of Main Streets and small towns, they also employ enormous amounts of Americans.

 

 

Bruce Wilds: The Paycheck Protection Program or PPP was funded with $350 billion in the last stimulus bill, this money is now gone. Of the thirty million small businesses in America, only 1.7 million received money from the 2.3 trillion dollar aid package passed to help sustain America during this difficult time. If the government blew through this money and was only was able to help only around 5% of small businesses. it is difficult to think another 250 billion dollars will set things straight. Clearly, because when the government made promises it delayed the wave of firing while companies waited for help.

The government has failed to keep its promise so now we should expect unemployment to soar as reality sets in. One of the largest problems facing small companies is they are often underfunded and have difficulty getting financing at reasonable rates. Banks find larger companies much more profitable. The sector of the economy most damaged by the covid-19 shutdown is small business. When this is over America will find many small businesses have been decimated and are not able to reopen. Others will never recover and be forced to close within months. Since small businesses employ over 54 million people in America and their importance in the economy should not be underestimated.

• Small businesses contribute 44 percent of all sales in the country.
• Small businesses employ 54.4 million people, about 57.3 percent of the private workforce.

Rest assured government employees and bureaucrats will still continue to get paid but small business, the most productive part of the economy has a knife to its throat. As a landlord and small business owner, I can tell you the program was structured in a way that will be of little help to most small businesses. The government slammed expensive legislation through with no idea of the damage they were doing and how it will cause hundreds of thousands of businesses to close their doors forever. Washington has become so attuned to dealing with lobbyists from mega-companies it has lost sight of the fact small is small, and when this comes to business, this means usually under twenty employees, not hundreds.

 

 

The government’s answer to keeping people employed was to promise small businesses an easy to get, rapid maximum loan amount of two and a half times a company’s average monthly payroll expense over the past 12 months. This loan would turn into a grant and be forgiven if a company did not fire its employees. Sadly, legislators failed to take into consideration that not all small businesses are labor or payroll intense. Some businesses with large or expensive showrooms are getting hammered by rent, others by inventory, or things like taxes, utilities, or even by having to toss products due to spoilage.

The PPP also failed to address the issue of what these employees are going to do while the company has no customers and business barely trickling. In the past, these employees were expected to pursue activities that earned revenue and garnered profits for the business but with no costumers, this is difficult to do. The PPP also ignored the fact that by keeping these employees on the payroll a generous employer is left open to the harsh mandates laid out in the government’s previous bill. The hastily drawn up 110-page federal covid-19 economic rescue package, which Trump fully supported dealt a hard blow to small business. For a small business this is a disaster, the bill requires;

• Employers with fewer than 500 employees and government employers offer two weeks of paid sick leave through 2020.
• Those same employers must now provide up to 3 months of paid family and medical leave for people forced to quarantine due to the virus or care for family because of the outbreak

As expected, this measure, named “Families First Coronavirus Response Act.” resulted in millions of workers suddenly losing their jobs. Ironically, it was held before the voters as proof lawmakers could work together during a crisis. By framing the poorly crafted pork-packed bill this way promoters positioned themselves to demonize those unwilling to support it. Remember, this bill is was in addition to the $8.3 billion emergency spending bill first approved to curb the spread of covid-19.

 

 

As government has grown larger it seems to have become totally oblivious to the fragility of many small businesses and how much it can cost a community when they close. By framing these pork-packed bills as bipartisan their promoters imply they are fair and balanced. This is not true, small business is the big loser and hundreds of thousands will soon have to close. With so many tenants looking at foregoing rent small landlords that don’t have deep pockets also face huge problems. We have our heads in the sand if we think companies that exist on events where people gather will overnight regain their luster. It is not like someone can simply flick a switch and things will return to normal.

Reality undercuts the idea of the “V-shaped recovery” theory and the idea after the economy has come to a dead stop it can quickly reboot and be back at full speed in a few months. The government has presented us with an extension of crony capitalism structured to throw just enough to the masses to silence their outrage but in the coming weeks, we will see it failed. Large businesses with access to cheap capital are the winners and the big losers are the middle-class, small businesses, and social mobility. All those people that want a higher minimum wage can forget that ever happening if we don’t have jobs.

As for just how much small business owners make, according to figures from 2015 from the Small Business Administration the median income for self-employed individuals at an incorporated business was $49,804 and $22,424 for unincorporated firms. According to PayScale’s 2017 data, the average small business owner’s income is $73,000 per year. But, total earnings can range from $30,000 – $182,000 per year. This means it varies greatly depending on where and just how big the business is. However, it is important to remember these people have “skin in the game” and most risk losing everything if their business fails.

 

It is important to recognize that starting your own business has always been about the opportunity to design and build your own future. It is a symbol of freedom not a guarantee of wealth. Many people choose this path proudly, not to make more money but as a way to express their individuality. For these competent and talented people, a job in government or at a large company often offers more security and benefits but far less freedom. Do not underestimate the value of small business and what it contributes to our society. Companies such as Amazon are the anti-thesis of small business making their workers a cog in a machine and stealing their soul.

Based on the government’s promise to small businesses a great many held off on letting employees go but with each passing day in order to survive they are now in the process of letting hundreds of thousands of employees go. This is a ticking time-bomb. By telling these businesses to close and then through its failure to carry out its promise of helping them the government has created a situation with massive negative economic ramifications. To make matters worse, people going on unemployment look to get almost as much as those that do work. Why will anyone want to work, especially government workers when they can get paid to stay home? This is not about wanting more money for small business, it is about the reality that the firings are just beginning.

 

 

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Apr 182020
 


Edward Hopper Cat boat 1922

 

Antibody Study Suggests Coronavirus Far More Widespread Than Thought (G.)
No Evidence COVID-19 Survivors Have Immunity – WHO (Sky)
Double Warning Over Antibody Tests (BBC)
Existing Drugs ‘May Prove Effective On Coronavirus Before Vaccine Comes’ (SCMP)
Emirates First Airline To Conduct On-Site Rapid COVID-19 Tests (Em.)
US Seeks Access To Wuhan Virology Lab, Trump Questions China Death Toll (SCMP)
US, China and WHO Are All Keen To Pass The Buck (SCMP)
U.S.S. Theodore Roosevelt Outbreak Much Larger, But Mostly Asymptomatic (JTN)
San Francisco Orders Residents To Wear Face Masks (F.)
UK Moves To Drop Huawei As 5G Vendor On China Coronavirus Transparency (NYP)
Where’s the $2.2 Trillion Bailout Money Going? (WS)
Flight Path (Kunstler)
The Transformation of Emmanuel Macron (CN)
Labour Party’s Own Senior Staff Acted To Keep Corbyn Out Of Power (ML)

 

 

• One week ago, the US #COVID19 #coronavirus death toll was 15,000. In the last 7 days, more than 20,000 Americans have died. The death toll is now 36,000+, Cases top 700,000

• Reported US coronavirus deaths:
– Feb. 17: 0 deaths
– Mar. 17: 111 deaths
– Apr. 17: 36,997 deaths

 

 

• Top 10 States – Positive Tests 4/17/20
1) NY/ 222,284 (TH data);
2) NJ/ 78467;
3/ MA/ 32,181;
4) PA/ 29,441;
5) MI/ 29,263;
6 CA/ 28,263;
7) IL/ 27,575;
8) FL/ 24,119;
9) LA/ 23,118;
10)TX 17,371.

• New York reports 7,753 new coronavirus cases & 1,025 new deaths, a total of 233,951 cases & 17,131 deaths..

• 1,081 sailors from French aircraft carrier test positive for coronavirus. 2,010 sailors have been tested so far.

• Coronavirus global update:
– 85k+ cases in last 24 hours
– 2.2 million cases in total
– 1.5 million active
– 575k recovered
– 155k deaths
– 31% of cases in the U.S.

 

 

 

Cases 2,261,425 (+ 67,867 from yesterday’s 2,193,558)

Deaths 154,734 (+ 7,356 from yesterday’s 147,378)

 

 

 

From Worldometer yesterday evening -before their day’s close- (Note: Brazil and Russia keep climbing fast)

 

 

From Worldometer – NOTE: mortality rate for closed cases remains at 21% –

 

 

From SCMP:

 

 

From COVID19Info.live: (Belgium in first place worldwide of deaths per million at 445, 14.3% CFR, before Spain, Italy, France and UK.)

 

 

 

 

We know nothing.

Antibody Study Suggests Coronavirus Far More Widespread Than Thought (G.)

A new study in California has found the number of people infected with coronavirus may be tens of times higher than previously thought. The study from Stanford University, which was released Friday and has yet to be peer reviewed, tested samples from 3,330 people in Santa Clara county and found the virus was 50 to 85 times more common than official figures indicated. To ease the sprawling lockdowns currently in place to stop the spread of Covid-19, health officials must first determine how many people have been infected. Large studies of the prevalence of the virus within a region could play a key role, researchers say.

“This has implications for learning how far we are in the course of the epidemic,” said Eran Bendavid, the associate professor of medicine at Stanford University who led the study. “It has implications for epidemic models that are being used to design policies and estimate what it means for our healthcare system.” The study marks the first large-scale study of its kind, researchers said. The study was conducted by identifying antibodies in healthy individuals through a finger prick test, which indicated whether they had already contracted and recovered from the virus. At the time of the study, Santa Clara county had 1,094 confirmed cases of Covid-19, resulting in 50 deaths.

But based on the rate of people who have antibodies, it is likely that between 48,000 and 81,000 people had been infected in Santa Clara county by early April – a number approximately 50 to 80 times higher. That also means coronavirus is potentially much less deadly to the overall population than initially thought. As of Tuesday, the US’s coronavirus death rate was 4.1% and Stanford researchers said their findings show a death rate of just 0.12% to 0.2%.

Read more …

Absolutely nothing.

No Evidence COVID-19 Survivors Have Immunity – WHO (Sky)

There is no evidence that people who have recovered from coronavirus have immunity to the disease, the World Health Organisation (WHO) has said. The UK government has bought 3.5 million serology tests – which measure levels of antibodies in blood plasma. But senior WHO epidemiologists have warned that there is no proof that such antibody tests can show if someone who has been infected with COVID-19 cannot be infected again. Many of the tests being developed are pinprick blood tests similar to instant HIV tests and measure for raised levels of the antibodies that the body uses to fight the virus.


Speaking at a news conference in Geneva, Dr Maria van Kerkhove said: “There are a lot of countries that are suggesting using rapid diagnostic serological tests to be able to capture what they think will be a measure of immunity. “Right now, we have no evidence that the use of a serological test can show that an individual has immunity or is protected from reinfection.” She added: “These antibody tests will be able to measure that level of seroprevalence – that level of antibodies – but that does not mean that somebody with antibodies means that they are immune.” Dr van Kerkhove said it was “a good thing” that so many tests are being developed, but said they will need to be validated “so that we know what they say they attempt to measure they are actually measuring”.

Read more …

Huh? “..The government has already paid for three-and-a-half million antibody tests, but has not yet found one that is reliable enough to use..

Double Warning Over Antibody Tests (BBC)

Hopes that coronavirus antibody tests could help the UK end its lockdown have been dealt a blow – after the World Health Organization questioned whether they offer any guarantee of immunity. The UK has placed antibody tests – which check if someone has had Covid-19 – at the centre of an eventual “back-to-work” plan to restart normal life. But experts said they may not prove if someone is protected from reinfection. The UK’s testing co-ordinator has also warned people not to buy private tests. The government has already paid for three-and-a-half million antibody tests, but has not yet found one that is reliable enough to use – and stresses that it will not approve the use of any test until it can be sure its findings can be fully depended on.


Professor John Newton said the public should not purchase unapproved antibody tests until a working test is approved. “We are breaking new ground with this work every day and I am confident this major research effort will make a breakthrough,” he said of efforts to develop a valid serology test, which measures levels of antibodies in blood plasma. “Until then, please don’t buy or take any unproven tests. They may not be reliable for your intended use; they may give a false reading and put you, your family or others at risk.” He added: “As soon as we have found a test that works for this purpose, we will be in a position to roll them out across the country as a back-to-work test.”

Read more …

Make Gilead shareholders rich.

Existing Drugs ‘May Prove Effective On Coronavirus Before Vaccine Comes’ (SCMP)

Dr Kim Woo Joo, who led South Korea’s response to Covid-19 and the outbreak of Mers in 2015, said he was “not very optimistic” about the availability of a Covid-19 vaccine in the next 18 months, but said evidence about the effectiveness of remdesivir, an experimental antiviral developed to treat Ebola; AbbVie’s Kaletra, an anti-HIV drug; or other medicines might be possible sooner. “If everything goes well, I am hoping that the effectiveness of these drugs will be scientifically proven within three to four months,” Kim, a professor of infectious diseases at Korea University Guro Hospital, said in an interview on Wednesday with the president of the Korea Society, Thomas Byrne.


Kim added that Seoul National University Hospital and the US National Institute of Allergy and Infectious Diseases, headed by Dr Anthony Fauci – a key player in the US government’s effort to control the coronavirus spread – were collaborating to test remdesivir, which emerged this week as possible treatment option. The health and medical news website Stat reported on Thursday that a Chicago hospital using remdesivir to treat severe Covid-19 patients saw rapid recoveries in fever and respiratory symptoms, with most patients discharged within a week. The University of Chicago Medicine recruited 125 people with Covid-19 into Gilead’s two phase-3 clinical trials and gave them daily remdesivir infusions, according to Stat. Of those patients, 113 had severe symptoms, the report said. Gilead’s share price shot up by nearly 15 per cent in after-hours trading after the Stat report and closed 9.7 per cent higher on Friday.

Read more …

Want to get tested? Book a flight.

Emirates First Airline To Conduct On-Site Rapid COVID-19 Tests (Em.)

Emirates in coordination with Dubai Health Authority (DHA) will be introducing additional precautions. Passengers on today’s flight to Tunisia were all tested for COVID-19 before departing from Dubai. Emirates is the first airline to conduct on-site rapid COVID-19 tests for passengers. The quick blood test was conducted by the Dubai Health Authority (DHA) and results were available within 10 minutes. This test was conveniently done at the Group Check-in area of Dubai International Airport Terminal 3. Adel Al Redha, Emirates Chief Operating Officer said: “The testing process has gone smoothly and we would like to take this opportunity to thank the Dubai Health Authority for their initiatives and innovative solutions.


“This would have not been possible without the support of Dubai Airport and other government authorities. We are working on plans to scale up testing capabilities in the future and extend it to other flights, this will enable us to conduct on-site tests and provide immediate confirmation for Emirates passengers travelling to countries that require COVID-19 test certificates. The health and safety of staff and passengers at the airport remain of paramount importance.” [..] Gloves, masks and hand sanitisers have been made mandatory for all employees at the airport. Passengers are also required to wear their own masks when at the airport and on board the aircraft, and follow social distancing guidelines.Emirates has modified its inflight services for health and safety reasons. Magazines and other print reading material will not be available

Read more …

Early on in the pandemic, it took many weeks for a WHO team to get access to China.

US Seeks Access To Wuhan Virology Lab, Trump Questions China Death Toll (SCMP)

US Secretary of State Mike Pompeo on Friday called on China to grant the United States access to the Wuhan laboratory that has emerged as a flashpoint between the two nations in a clash over the origin and handling of the coronavirus. “We are still asking the Chinese Communist Party to allow experts to get into that virology lab so that we can determine precisely where this virus began,” said Pompeo on Fox News. Pompeo’s comment escalated conjecture surrounding the lab as US President Donald Trump amplified doubts around the extent of the Covid-19 spread in China by announcing in a Twitter post that the country “has just announced a doubling in the number of their deaths from the Invisible Enemy. It is far higher than that and far higher than the US, not even close!”


The tweet was not accurate as China only announced a revised increase in deaths out of Wuhan by 50 per cent. The number of cases in China – more than 83,700 – still trails that of the US, which has more than 679,000. Addressing reporters later on Friday, Trump doubled down on his assertion, stating that China had the most deaths in the world. “We don’t have the most in the world – deaths,” Trump said of the US tally, which stands at more than 34,000. “The most in the world has to be China. It’s a massive country. It’s gone through a tremendous problem with this.”

Read more …

There you go. The WHO was only granted access in the third week of February, 7-8 weeks after Beijing reported the first cases.

And then it took another 3 weeks before the WHO declared a pandemic on March 11. That’s not just a technicality.

US, China and WHO Are All Keen To Pass The Buck (SCMP)

The first public report of the coronavirus came on December 31, when the health commission in Hubei province – of which Wuhan is the capital – reported 27 cases of pneumonia. The WHO set up an incident management support team the next day and published its first notice about the outbreak on January 5, in which it said there was “no evidence of significant human-to-human transmission”, and advised against travel or trade restrictions on China. Margaret Harris, a spokeswoman for the WHO, told US broadcaster CNN on Monday that at the time, “alarm bells were already ringing through the halls of the WHO”, and that it was “aware it was a very serious matter”. As the number of cases rose, the WHO began issuing technical guidance, with its technical lead on Covid-19, Maria Van Kerkhove, saying on January 14 that it was “certainly possible that there is limited human-to-human transmission” of the virus.

But on Twitter, the WHO’s official account on January 13 and 14 continued to suggest there was “no clear evidence of human-to-human transmission”. A critical turning point in the epidemic came on January 20, when Zhong Nanshan, a high-profile Chinese epidemiologist who managed the nation’s response to the severe acute respiratory syndrome (Sars) outbreak of 2002-03, said that there was human-to-human transmission of the virus and that medical workers had been infected. The WHO then said it was “very clear from the latest information that there is at least some human-to-human transmission”. Trump this week slammed the WHO for having “parroted and publicly endorsed the idea that there was not human-to-human transmission” in mid-January.

The WHO issued multiple notices on the virus that month and maintained its assessments were based on available evidence at the time. On January 22 and 23, the agency convened an emergency committee to determine whether the coronavirus constituted a global public health emergency, but delayed making a declaration. A week later, on January 30, when Tedros did declare a global health emergency, he stressed that it was “not a vote of no confidence” in China, and continued to oppose restrictions on travel and trade with the world’s most populous nation. The WHO said its guidance on travel bans stemmed from its experience with other outbreaks, and that such restrictions might not be effective in curbing the virus’ spread. Despite those recommendations, Trump on January 31 announced a ban on most travellers from China entering the US.

China’s foreign ministry spokeswoman Hua Chunying responded by saying the US had “inappropriately overreacted” and gone against WHO guidance. Tedros said later that there was no need for actions that “unnecessarily interfere with international travel and trade”. “One of the most dangerous and costly decisions from the WHO was its disastrous decision to oppose travel restrictions from China and other nations,” Trump said this week. “Fortunately, I was not convinced and suspended travel from China, saving untold numbers of lives.” Tedros met Chinese President Xi Jinping at the end of January, after which it was announced that the WHO would send a team of experts to China to get a better understanding of the outbreak. But it was not until nearly three weeks later that the WHO-China joint mission of experts began their trip, with Wuhan originally left off the agenda, only to be tacked on days later. At the end of the visit, the joint mission produced a gushing report that described China’s response to the outbreak as “perhaps the most ambitious, agile, and aggressive disease containment effort in history”.

Read more …

Walking infection bombs.

U.S.S. Theodore Roosevelt Outbreak Much Larger, But Mostly Asymptomatic (JTN)

The Navy’s coronavirus testing of the entire crew of the U.S. aircraft carrier Theodore Roosevelt is now nearly complete. Of the ship’s 4,800-member crew, more than 600 sailors have tested positive for the virus. However, of those 600, 60% have not shown any symptoms associated with the illness. The virus’s numbers aboard the Roosevelt continue to raise questions about the true spread rate of the illness, as opposed to the numbers that testing in the United States, and around the world, are capturing. The proportion of people who are asymptomatic carriers of the virus remains unknown, but the Theodore Roosevelt’s figure is higher than the 25%-50% range that Dr. Fauci put forward in early April. The numbers from the Naval ship provide data on the epidemiologically underrepresented group that is the younger, largely healthy population. This week, one sailor infected while aboard the ship died, and five remain hospitalized.

Read more …

With New York, Maryland and Los Angeles.

San Francisco Orders Residents To Wear Face Masks (F.)

San Francisco residents will be required to wear face masks outside their homes, the city announced Friday, joining New York, Maryland and Los Angeles County, as areas of the U.S. begin to think about what life will look like when social distancing measures are relaxed. The order goes into effect 11:59 p.m. Friday. • Individuals must wear masks on public transit as well as inside public buildings, health facilities and essential businesses such as the grocery store or pharmacy. • Businesses should refuse service to anyone who isn’t wearing a face covering and ensure their workers are wearing masks, the order says. • Residents don’t have to wear face coverings while at home, in the car or outdoors walking or running, though the city recommends bringing along a face covering anyway, even if residents aren’t wearing it at that moment. • Children under 12 are also not required to wear face masks.


City leaders urged residents to continue staying at home, saying that wearing a mask in public “is not a substitute for staying home, staying 6 feet apart and frequent handwashing.” “By covering your face when you go pick up food or ride Muni, you are helping reduce the risk of infecting those around you. As we look to a time where we can begin to ease the Stay Home Order, we know that face coverings will be part of that future – and we want San Franciscans to become more comfortable with this new normal,” San Francisco Mayor London Breed said.

Read more …

Without Boris the UK gets even more rudderless.

UK Moves To Drop Huawei As 5G Vendor On China Coronavirus Transparency (NYP)

The UK is moving to drop Huawei as a vendor for the country’s 5G cellphone network in a major blow to Communist China over poor coronavirus transparency. Prime Minister Boris Johnson, now recovering from COVID-19, gave the Chinese company a role in 5G infrastructure this year, squashing opposition last month by 24 votes in the 650-seat House of Commons. But now, concern about the Chinese Communist Party’s inaccurate reporting on the coronavirus has lawmakers crafting plans for a retreat. “We need to devise a proper, realistic exit strategy from relying on Huawei,” Conservative Member of Parliament Damian Green told Bloomberg News.


“Our telecom providers … need to know the government is determined to drive down Huawei’s involvement to zero percent over a realistic timescale.” “The mood in the parliamentary party has hardened,” said Tom Tugendhat, the Conservative Party’s chairman of the House of Commons Foreign Affairs Committee. “It’s a shared realization of what it means for dependence on a business that is part of a state that does not share our values,” Tugendhat said.

Read more …

I’m afraid to ask.

Where’s the $2.2 Trillion Bailout Money Going? (WS)

When the $2.2 trillion bailout package was being put together in Congress in all haste in March, a mad scramble broke out over who would get what. Part of this deal was the $349 billion Paycheck Protection Program for “small businesses” – which can be, as we now know, a publicly traded company with over 5,700 employees, or a KKR-backed power company that, upon getting the loan, files for prepackaged Chapter 11 bankruptcy. And so, the program already ran out of money as of Thursday, according to the SBA. “Notice: Lapse in Appropriations. The SBA is currently unable to accept new applications for the Paycheck Protection Program based on available appropriations funding,” it said on its website. The program dispersed 1.66 million loans, according to the SBA’s tally. There were 30.2 million small businesses in the US in 2019, so about 5.5% got loans.

What’s going to happen to the remaining 94.5% of the small businesses? Congress is contemplating a $250-billion expansion of the program that would cover maybe another 4% of small businesses. In other words, most small businesses aren’t going to get any of it. A small business under the plan is a business with 500 employees or fewer. Loans were capped at $10 million. But wait… 4,412 loans were issued in amounts larger than $5 million each. And we already know which company with 5,700 employees got $20 million. Yup, a restaurant chain, because they and hotel chains were exempted from the employee limit. Restaurants and hotels got their own limit: 500 employees per location. They accomplished this through magnificent lobbying efforts.

Ruth’s Chris Steakhouse [RUTH] – with about 5,700 employees at the end of last year and 159 restaurants across the US – disclosed in an SEC filing on April 13 that on April 7, four days after the SBA opened the filing process and as the system was bogged down, it obtained a PPP loan of $20 million, spread over two loans of $10 million each for two of its entities. JPMorgan Chase was the lender. If the company follows the rules, this $20 million will be forgiven. And then there is the curious case of Longview Power LLC, in which KKR, one of the big private equity firms, has a 40% stake as a result of Longview’s bankruptcy in 2015. Longview owns a 700-megawatt coal-fired power plant in West Virginia and has about 140 employees. It was approved for a PPP loan last Friday, and on Tuesday it announced that it filed for Chapter 11 bankruptcy.

Read more …

“Money is not an economy. Money is a medium of exchange within an economy ..”

Flight Path (Kunstler)

The Covid-19 corona virus didn’t initiate the financial disorders of the moment in the US and Europe, but it ensured that there would not be another appearance of any “recovery” a la the central bank interventions of 2008-09. What it portends is a fast-track journey to a whole new disposition of things: first, for a while, a harsher, hungrier, angrier society of broken promises and dashed expectations; and then adaptation when a consensus emerges that the set of facts at hand amount to a new reality. In the meantime, we’re living in the meantime, which is not a comfortable place.

Money is not an economy. Money is a medium of exchange within an economy where people grow things, make things, move things, and serve each other in countless ways. We’re not going to replace all those growings, makings, movings, and services by just giving people money. Money may produce more money by the magic of compound interest, but money is not necessarily wealth, it just represents our ideas about wealth, and interest stops compounding anyway when the trend is clearly for reduced growings, makings, movings, and servicings. That’s exactly how and why capital vanishes. The hocus-pocus of Modern Monetary Theory can only pretend to work around that reality.

The world never reached such a pitch of activity up to the blow-ups of 2008, and it went through the motions for a decade after that. Now that it’s stopped, all that’s left is the law of gravity, and it doesn’t get more basic. The “wealth” acquired in the decade since by the so-called “one-percent” was loaded onto a defective aircraft, like a Boeing 737-MAX, and an awful lot of it will fall to earth now on broken wings. Their agents and praetorians on Wall Street are working feverishly to stave off that crash-landing, like a band of magicians casting spells on the ground while that big hunk of juddering metal augers earthward. Wait for it as spring brings new life across the land and things unseen before steal onto the scene.

Read more …

He can transform right back.

The Transformation of Emmanuel Macron (CN)

[..] something strange has happened since the Coronavirus hit France. An apparent humanity buried deep inside the French president has suddenly emerged—and let the bankers be damned. In an interview on Thursday with the Financial Times, Macron talked about economics as a “moral science” and said European debt should be mutualized, meaning northern Europeans should be on the hook for southern debt—or face the wrath of right-wing populists. He said the European Union was not just a market but was really about human beings. In other words, he was calling for state intervention in the economy, going against everything he has heretofore believed. “We are all embarking on the unthinkable,” he said.

“We are at a moment of truth, which is to decide whether the European Union is a political project or just a market project,” he said. “I think it’s a political project . . . We need financial transfers and solidarity, if only so that Europe holds on.” The French president said he sees the crisis as “an existential event for humanity that will change the nature of globalization and the structure of international capitalism,” the newspaper reported. “In recent years [globalization] increased inequalities in developed countries,” he admitted. “And it was clear that this kind of globalisation was reaching the end of its cycle, it was undermining democracy.”

Macron told the FT: “We are going to nationalise the wages and the P&L [the financial accounts] of almost all our businesses. That’s what we’re doing. All our economies, including the most [economically] liberal are doing that. It’s against all the dogmas, but that’s the way it is. “I believe [the EU] is a political project. If it’s a political project, the human factor is the priority and there are notions of solidarity that come into play . . . the economy follows on from that, and let’s not forget that economics is a moral science.”

Read more …

If you ever vote for these ghouls again, you deserve what you get.

Labour Party’s Own Senior Staff Acted To Keep Corbyn Out Of Power (ML)

In the June 2017 UK general election, Labour under Jeremy Corbyn came within a whisker of power. If just 2,227 votes had gone the other way, seven Tory knife-edge constituencies would have been won by Labour, putting Corbyn in a strong position to lead a coalition government. Labour achieved 40 per cent in the election, increasing its share of the vote by more than any other of the party’s election leaders since 1945. As we noted at the time, it was one of the most astonishing results in UK political history. A leaked internal Labour report now reveals that senior Labour figures were actively trying to stop Labour winning the general election in order to oust Corbyn as party leader.

The 860-page document, ‘The work of the Labour Party’s Governance and Legal Unit in relation to antisemitism, 2014 – 2019’, first leaked to Sky News, was the product of an extensive internal investigation into the way Labour handled antisemitism complaints. The report includes copious damning examples of email and WhatsApp exchanges among Labour officials expressing contempt for Jeremy Corbyn and anyone who supported him, including other Labour staff, Labour MPs and even the public. The document includes:

• Conversations on election night about the need to hide internal Labour disappointment that Corbyn had done better than expected and would be unlikely to resign
• Regular sneering references to Corbyn-supporting party staff as ‘trots’
• Conversations between senior staff in Labour general secretary Iain McNicol’s office in which they refer to former director of communications Seamus Milne as ‘dracula’, and saying he was ‘spiteful and evil and we should make sure he is never allowed in our Party if it’s last thing we do’
• Conversations in which the same group refers to Corbyn’s former chief of staff Karie Murphy as ‘medusa’, a ‘crazy woman’ and a ‘bitch face cow’ that would ‘make a good dartboard’
• A discussion in which one of the group members expresses their ‘hope’ that a young pro-Corbyn Labour activist, whom they acknowledge had mental health problems, ‘dies in a fire’.

Read more …

 

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Nov 152014
 
 November 15, 2014  Posted by at 11:53 am Finance Tagged with: , , , , , , , , , ,  2 Responses »


DPC Elephants in Luna Park promenade, Coney Island 1905

Oil Price Slump To Trigger New US Debt Default Crisis (Telegraph)
How Low Can the Price of Oil Plunge? (WolfStreet)
Russia Braces for ‘Catastrophic’ Drop in Oil Prices (Bloomberg)
What Really Happened In Beijing Between Putin, Obama and Xi (Salon)
Can Low Oil Prices Be Good for the Environment? (AP)
More Than 4 In 10 Americans Still Exhaust Unemployment Benefits (MarketWatch)
Most Americans Make Less Than $20 Per Hour (MarketWatch)
The Reason Small Businesses Are Disappearing (Zero Hedge)
Italy’s Crazy New Economy from Hell Suffocates Small Businesses (WolfStreet)
Beppe Grillo: The Euro Is Destroying The Italian Economy (Zero Hedge)
Eurozone Dodges Recession But Submerges In ‘Lost Decade’ (AEP)
Who Will Pay for China’s Bust? (Bloomberg)
China Slowdown Deepens as Targeted Stimulus Fails (Bloomberg)
Take Cover Now – They Don’t Ring A Bell At The Top (David Stockman)
Asset Bubbles Are Top Concern for US Heartland’s Fed Banker (Bloomberg)
Fed’s Bullard Still Wants Rate Rise in Q1 2015 (Dow Jones)
Turkish Hackers Crack Electric Utility; Delete $670 Billion Of Pending Bills (ZH)
California Pension Funds Are Running Dry (LA Times)
Pope Francis’s ‘Holy War’ On Capitalism And Toxic Inequality (Paul B. Farrell)

The end of shale as we know it.

Oil Price Slump To Trigger New US Debt Default Crisis (Telegraph)

Remember the global financial crisis, triggered six years ago when billions of dollars of dodgy loans – doled out by banks to subprime borrowers and then resold numerous times on international debt markets – began to unravel and default? Stock markets plunged, banks collapsed and the entire global financial system teetered on the brink of catastrophe. Well a similarly chilling economic scenario could be set off by the current collapse in oil prices. Based on recent stress tests of subprime borrowers in the energy sector in the US produced by Deutsche Bank, should the price of US crude fall by a further 20pc to $60 per barrel, it could result in up to a 30pc default rate among B and CCC rated high-yield US borrowers in the industry. West Texas Intermediate crude is currently trading at multi-year lows of around $75 per barrel, down from $107 per barrel in June. “A shock of that magnitude could be sufficient to trigger a broader high-yield market default cycle, if materialised,” warn Deutsche strategists Oleg Melentyev and Daniel Sorid in their report.

Five years ago at the beginning of what has become known as the US shale oil revolution, drillers started to load up on debt to fund their operations and acquire new acreage as vast areas of North America started to open up for exploration. In 2010, energy and materials companies made up just 18pc of the US high-yield index – which tracks sub-investment grade borrowers – but today they account for 29pc of the measure after drilling firms spent the past five years borrowing heavily to underwrite the operations. The result of this debt splurge has been a spectacular rise in US oil and gas output. Latest estimates suggest that by the end of the decade the US will have outstripped even Saudi Arabia and Russia in terms of oil production. The development of new shale resources in North America and the opening up of fields in the Arctic seas off Alaska could see the country pumping 14.2m barrels per day (bpd) of oil and petroleum liquids by 2020, up from 7.5m bpd in 2013.

This rush to pump more oil in the US has created a dangerous debt bubble in a notoriously volatile segment of corporate credit markets, which could pose a wider systemic risk in the world’s biggest economy. By encouraging ever more drilling in pursuit of lower oil prices, the US Department of Energy has unleashed a potential economic monster and pitched these heavily debt-laden shale oil drilling companies into an impossible battle for market share against some of the world’s most powerful low-cost producers in the Organisation of Petroleum Exporting Countries (Opec). It’s a battle the US oil fracking companies won’t win.

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Excellent piece by Wolf Richter. If you want to know where oil is going, read it.

How Low Can the Price of Oil Plunge? (WolfStreet)

It is possible that a miracle intervenes and that the price of oil bounces off and zooms skyward. We’ve seen stocks perform these sorts of miracles on a routine basis, but when it comes to oil, miracles have become rare. As I’m writing this, US light sweet crude trades at $76.90 a barrel, down 26% from June, a price last seen in the summer of 2010. But this price isn’t what drillers get paid at the wellhead. Grades of oil vary. In the Bakken, the shale-oil paradise in North Dakota, wellhead prices are significantly lower not only because the Bakken blend isn’t as valuable to refiners as the benchmark West Texas Intermediate, but also because take-away capacity by pipeline is limited.

Crude-by-rail has become the dominant – but more costly – way to get the oil from the Northern Rockies to refineries on the Gulf Coast or the East Coast. These additional transportation costs come out of the wellhead price. So for a particular well, a driller might get less than $60/bbl – and not the $76.90/bbl that WTI traded for at the New York Mercantile Exchange. Fracking is expensive, capital intensive, and characterized by steep decline rates. Much of the production occurs over the first two years – and much of the cash flow. If prices are low during those two years, the well might never be profitable. Meanwhile, North Sea Brent has dropped to $79.85 a barrel, last seen in September 2010.

So the US Energy Information Administration, in its monthly short-term energy outlook a week ago, chopped down its forecast of the average price in 2015: WTI from $94.58/bbl to $77.55/bbl and Brent from $101.67/bbl to $83.24/bbl. Independent exploration and production companies have gotten mauled. For example, Goodrich Petroleum plunged 71% and Comstock Resources 58% from their 52-week highs in June while Rex Energy plunged 65% and Stone Energy 54% from their highs in April. Integrated oil majors have fared better, so far. Exxon Mobil is down “only” 9% from its July high. On a broader scale, the SPDR S&P Oil & Gas Exploration & Production ETF is down 28% from June – even as the S&P 500 set a new record. So how low can oil drop, and how long can this go on?

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Did they know beforehand it would come?

Russia Braces for ‘Catastrophic’ Drop in Oil Prices (Bloomberg)

President Vladimir Putin said Russia’s economy, battered by sanctions and a collapsing currency, faces a potential “catastrophic” slump in oil prices. Such a scenario is “entirely possible, and we admit it,” Putin told the state-run Tass news service before attending this weekend’s Group of 20 summit in Brisbane, Australia, according to a transcript e-mailed by the Kremlin today. Russia’s reserves, at more than $400 billion, would allow the country to weather such a turn of events, he said. Crude prices have fallen by almost a third this year, undercutting the economy in Russia, the world’s largest energy exporter.

Even the central bank’s forecast of zero growth next year may be in danger as the International Energy Agency forecasts a deepening rout in oil prices as the market enters a period of weaker demand. Brent crude, the grade traders look at for pricing Russia’s Urals main export blend, has collapsed into a bear market as leading members of the Organization of Petroleum Exporting Countries resisted calls to cut production and U.S. output climbed to the highest level in three decades because of the shale boom. Brent is heading for its eighth weekly decline after sliding below $80 for the first time in four years. Futures were at $78.29 a barrel in London today, down 6.1% this week and 29% this year.

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Must read from Patrick Smith at Salon.

What Really Happened In Beijing Between Putin, Obama and Xi (Salon)

By way of events on the foreign side, the past few weeks start to resemble some once-in-a-while event in the heavens when everyone is supposed to go out and watch as the sun, moon and stars align. There are lots of things happening, and if we put them all together, the way Greek shepherds imagined constellations, a picture emerges. Time to draw the picture. The situation on the ground in Ukraine is getting messy again. Equally, events of the past year now leave Ukraine’s economy not far from sheer extinction. You have not read of this because it does not fit the approved story, but Ukraine’s heart barely beats. Further east, we hear in the financial markets that the ruble’s decline brings Russia to the brink of another financial collapse. Let’s see. Oil prices are now below $80 a barrel. It costs me nearly $20 less to put gasoline in my car than it did a year ago, and good enough. But why has the price of crude tumbled in so short an interval? It makes little sense when you gather the facts, and – goes without saying – you get no help with that from our media.

Let’s keep on trucking. Secretary of State Kerry went to Oman for another round of talks on the Iranian nuclear question last weekend. Russia recently emerged as a potentially key part of a deal, which will be the make-or-break of Kerry’s record. In effect, he now greets Russian Foreign Minister Sergei Lavrov with one hand and punches him well below the belt with the other. Somewhere beyond our view this must make sense. En avant! Obama went to Beijing last week for a sit-down with Xi Jinping, who makes Vladimir Putin look like George McGovern when he wants to, which is not infrequently. Still in the Chinese capital, our president then attended a meeting with other Asian leaders to push a trade agreement, one primary purpose of which is to isolate China by bringing the rest of the region into the neoliberal fold. (Or trying to. Washington will never get the overladen, overimposing Trans-Pacific Partnership off the ground, in my view.)

A big item on Xi’s agenda — he was in on the Pacific economic forum, too — was the recent launch of an Asians-only lending institution intended to rival the Asian Development Bank, the World Bank affiliate doing the West’s work in the East. Being entirely opposed to people helping themselves advance without American assistance and all that goes with it, Washington used all means possible to sink this ship. When Obama got off the plane in Beijing, the Asian Infrastructure Investment Bank had $50 billion in capital and 20 members, more to come in both categories. Xi, meantime, had a productive encounter — another — with the formidable Vlad. My sources in attendance tell me both put in strong performances. In short order, Russia will send enough natural gas eastward to meet much of China’s demand and — miss this not — in the long run could price out American supplies in other Pacific markets, which are key to the success of the current production boom out West.

This is a lot of dots to connect. As I see it, the running themes in all this are two: There is constructive activity and there is the destructive. Readers may think this oversimplifies, but for this there is the ever-lively comment box below. I am willing to listen. Let’s go back to early September. On the 5th, Germany brokered a cease-fire between the Ukraine government in Kiev and the rebels in the eastern Donbass region. Washington made it plain it wanted no part of this, preferring to continue open hostilities. And then strange things happened. Less than a week after the Minsk Protocol was signed, Kerry made a little-noted trip to Jeddah to see King Abdullah at his summer residence. When it was reported at all, this was put across as part of Kerry’s campaign to secure Arab support in the fight against the Islamic State.

Stop right there. That is not all there was to the visit, my trustworthy sources tell me. The other half of the visit had to do with Washington’s unabated desire to ruin the Russian economy. To do this, Kerry told the Saudis 1) to raise production and 2) to cut its crude price. Keep in mind these pertinent numbers: The Saudis produce a barrel of oil for less than $30 as break-even in the national budget; the Russians need $105. Shortly after Kerry’s visit, the Saudis began increasing production, sure enough – by more than 100,000 barrels daily during the rest of September, more apparently to come. Last week they dropped the price of Arab Light by 45 cents a barrel, Bloomberg News just reported. This has proven a market mover, sending prices to $78 a barrel at writing.

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No worries, mate, we’ll find a way to screw that up too.

Can Low Oil Prices Be Good for the Environment? (AP)

Deepwater drilling rigs are sitting idle. Fracking plans are being scaled back. Enormous new projects to squeeze oil out of the tar sands of Canada are being shelved. Maybe low oil prices aren’t so bad for the environment after all. The global price of oil has plummeted 31% in just five months, a steep and surprising drop after a four-year period of prices near or above $100 a barrel. Not long ago a drop of that magnitude would have hit the environmental community like a gut-punch. The lower the price of fossil fuels, the argument went, the less incentive there would be to develop and use cleaner alternatives like batteries or advanced biofuels.

But at around $75 a barrel, the price is high enough to keep investments flowing into alternatives, while giving energy companies less reason to pursue expensive and risky oil fields that also pose the greatest threat to the environment. “Low prices keep the dirty stuff in the ground,” says Ashok Gupta, director of programs at the Natural Resources Defense Council. Economists and environmentalists caution that if the price goes too low, and stays there, consumption could swell and the search for alternatives could stop. They say a good price range for the environment could be somewhere between $60 and $80. As oil demand in developing countries began rising in the last decade, drillers struggled to keep up and prices began to rise. It seemed the world might be running out of oil. Investors poured money into advanced biofuels companies and battery-makers betting high oil prices would make it cheaper to drive on plant waste or electricity.

It hasn’t happened, despite some headway. Even after years of growth, electric cars accounted for just 0.4% of new vehicle sales so far this year, according to Edmunds.com. Biofuels from plant waste account for even a smaller percentage of the nation’s fuel mix. The high prices instead inspired drillers and investors to pursue oil wherever it might be found no matter the expense. They developed projects in environmentally-sensitive areas or using environmentally-destructive methods. They developed technology that has unlocked vast resources once thought out of reach. What was once a shortage now looks to be a surplus. “It was a net negative from a climate perspective,” says Andrew Logan, director of oil and gas programs at the environmental group Ceres. “It locked us into long-term dependence on oil.”

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That’s when we stop counting them.

More Than 4 In 10 Americans Still Exhaust Unemployment Benefits (MarketWatch)

The number of Americans applying for unemployment compensation is near a 15-year low, but a higher percentage than usual still don’t find jobs before their benefits run out. The percentage of people who received unemployment benefits each week until they were no longer eligible stood at a 12-month average of 41.5% in September, according to Labor Department data. In other words, more than four in 10 unemployed Americans still exhaust their benefits before finding a job. Granted, the rate has fallen sharply from a postrecession peak of 55.8% in March 2010 – the highest level since the government began keeping track in 1972. But the rate is still markedly higher vs. a 34.7% low point reached during the 2002-2006 expansion. The percentage who exhaust benefits is also well above the historical average of 35.9%. The U.S. labor market is improving, but a variety of measures such as the exhaustion rate for unemployment benefits shows that a lot more work needs to be done.

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Let’s get a mortgage, shall we? And a car loan.

Most Americans Make Less Than $20 Per Hour (MarketWatch)

According to data compiled by Goldman Sachs, most American workers earn below $20 per hour. Goldman Sachs economists David Mericle and Chris Mischaikow crunched Labor Department data that is used to generate the monthly jobs report that the market closely watches, in particular from the survey of employers. 19% of workers make less than $12.50 per hour, 32% of workers make between $12.50 and $20 per hour, 30% make between $20 and $30 an hour, 14% make between $30 and $45 per hour, and 5% make over $45 an hour. (It’s important to note that this includes all workers covered by the establishment survey, not just hourly workers; to convert annual pay to hourly pay, divide by 2080, for a standard 40-hour week.) The economists also found that, while wage growth has been soft, the fastest growth in income has come to the lowest-paid workers. And they found that the biggest driver to income growth has been rising employment, with help from rising wages and more hours worked.

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See also the following article, this is not just happening in the US.

The Reason Small Businesses Are Disappearing (Zero Hedge)

Confused why despite endless daily propaganda that the US economy is getting better – after all “just look at the record high S&P 500” – fewer and fewer Americans believe the narrative, as the Democrats and Obama found out the very hard way in last week’s midterm elections? Then the following explanation written by the owner of a small business – the segment of the US economy that has historically led every single recovery but this time was left behind – should help answer some questions.

The reason small businesses are disappearing written by a small business owner. I want to start out by saying that i am a 27 year old male with a small business in Sacramento CA. I started this business a few years ago with savings of 15k. With a lot of hard work and determination i have succeeded, but it sure as hell was not easy. I am a long time lurker and have never seen anyone go in depth about what its like to own a small business and the reason why they are disappearing. Without going into to much detail, i own a furniture store so obviously things are different then other businesses but a lot of the things are the same. I wanted to begin with the things that are killing small businesses. Also only my opinion.

Small Business Loans – Although they are not killing small business they sure as hell don’t help anyone. Unless you are opening a unique small business you are not going to get any funding. By unique i mean something along the lines of creating solar panels. According to a recent investigation by the SBA Inspector General (ill post the article if you would like), over 75% of SBA loans went to large businesses. So basically if you want to open a normal business you need a ton of collateral and a miracle to get a loan.
Permits and Licensing – In opening my specific business the first year totaled about $2000.00.
Advertising – Many small business’s cant afford to take out pages or flyers in the news paper or TV ads so they only have a few choices such as Yelp or the Penny-saver. (Don’t get me started in Yelp).
Street Advertising – While this used to be a good portion of how you get business it is now off limits. Code enforcement will not allow you to put anything outside. No balloons, signs, anything with your store name, window paint more than 50%, or any mattresses. Also delivery vehicles can not be closer than 50 feet from the curb. In my case that means behind the building.
Board of Equalization – Cant go into to much detail here but they sure as hell aren’t here to help.
Health Insurance – Now obviously with the people that have a large work force working full time they will be hit hard by obamacare, but i wanted to give you a perspective on a single person. The cheapest rate for myself and me only, and believe me i have looked around, is $250.00/month. Some might say oh that’s not bad, but let me explain what that covers, NOTHING lol. Basically if something happens to me i have to shell out 6K before insurance gets involved. Also 100 dollar co pay every time i go.
The economy – While many know that when the President comes on TV and says the economy is doing great, we all know it is not, some people don’t. Every month more people drop out of the Labor Force and the number of families on food stamps is sky rocketing. So for those of you who don’t know the economy is terrible because of all the top stories of Kim Kardashian and whoever else, lots of people in america are struggling.
Merchant Fees – This is for credit card processing machines. The machine itself costs 600.00 plus the percentages on sales and cards. Companies such as BofA charge once a year on top of the regular fees $150.00 to protect you from fraud (which they can’t even stop) and yes its mandatory. Paypal or Square seem to be the best options these days.
Fire Department – Yes even the Fire Department wants a piece. Starting last year you must do your own visual inspection and send them a check for 150! Basically if you don’t they will come to your store and give you a million violations for wasting there time.

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I quoted Beppe Grillo yesterday as saying that 25% of Italy’s industry has gone sine the country joined the eurozone in 1997. That’s a scorched earth-type devastation.

Italy’s Crazy New Economy from Hell Suffocates Small Businesses (WolfStreet)

Italy is a country of entrepreneurs and of vibrant small enterprises. Or was. Now these businesses are dying. Of its 5.3 million companies (as of December 31, 2013), 3.3 million are small, often family-owned outfits, according to Rome-based credit information provider Cerved Group. And another 900,000 are sole proprietorships, or 17% of all companies, a larger percentage than anywhere else in the EU, ahead of France (12%), Spain (10%), and Germany (10%). The remaining 1 million companies are corporations of all sizes. And life in Italy has been exceedingly tough for small outfits. Consumer spending has dropped sharply since the onset of the crisis. Industrial production continued its downward spiral in September and is down 0.5% for the first nine months of 2014 over the same period a year ago. Unemployment is 12.6%, and rising. Youth unemployment is at a catastrophic 43%, up from an already terrible 26% in 2010.

It doesn’t help that the government refuses, and I mean refuses – due to “technical” problems, as a minister explained – to pay its long overdue bills to these already strung-out businesses. It’s a shell game to lower Italy’s overall indebtedness and thus pacify the financial markets and Italy’s masters in Brussels. So this shouldn’t come as a surprise, given that the largest customer in the country, the government, refuses to pay its bills to the members of the private sector which then can’t pay their own bills: in September, non-performing loans held by Italian banks jumped 19.7% from a year ago, according to the Bank of Italy. At the same time, loans to the private sector dropped 2.3%. Economic “growth” has been negative or zero for the last 13 quarters. And this is what Italy’s glorious “recovery” from hell looks like:

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My man Beppe. Perhaps still the only man in Europe who makes real sense. He says 2/3 of the Italian Parliament supports his plan for a referendum on the euro. Martin Armstrong suggests the EU may kill him before letting it happen.
See yesterday’s: The Only Man In Europe Who Makes Any Sense.

Beppe Grillo: The Euro Is Destroying The Italian Economy (Zero Hedge)

Next week, Italy’s Beppe Grillo – the leader of the Italian Five Star Movement – will start collecting signatures with the aim of getting a referendum in Italy on leaving the euro “as soon as possible,” just as was done in 1989. As Grillo tells The BBC in this brief but stunning clip, “we will leave the Euro and bring down this system of bankers, of scum.” With two-thirds of Parliament apparently behind the plan, Grillo exclaims “we are dying, we need a Plan B to this Europe that has become a nightmare – and we are implementing it,” raging that “we are not at war with ISIS or Russia! We are at war with the European Central Bank,” that has stripped us of our sovereignty.

Beppe Grillo also said today:

It is high time for me and for the Italian people, to do something that should have been done a long time ago: to put an end to your sitting in this place, you who have dishonoured and substituted the governments and the democracies without any right. Ye are a factious crew, and enemies to all good government; ye are a pack of mercenary wretches, and would like Esau sell your country for a mess of pottage, and like Judas betray your God for a few pieces of money. Is there a single virtue now remaining amongst you? A crumb of humanity? Is there one vice you do not possess? Gold and the “spread” are your gods. GDP is you golden calf.

We’ll send you packing at the same time as Italy leaves the Euro. It can be done! You well know that the M5S will collect the signatures for the popular initiative law – and then – thanks to our presence in parliament, we will set up an advisory referendum as happened for the entry into the Euro in 1989. It can be done! I know that you are terrified about this. You will collapse like a house of cards. You will smash into tiny fragments like a crystal vase. Without Italy in the Euro, there’ll be an end to this expropriation of national sovereignty all over Europe. Sovereignty belongs to the people not to the ECB and nor does it belong to the Troika or the Bundesbank. National budgets and currencies have to be returned to State control. They should not be controlled by commercial banks. We will not allow our economy to be strangled and Italian workers to become slaves to pay exorbitant interest rates to European banks.

The Euro is destroying the Italian economy. Since 1997, when Italy adjusted the value of the lira to connect it to the ECU (a condition imposed on us so that we could come into the euro), Italian industrial production has gone down by 25%. Hundreds of Italian companies have been sold abroad. These are the companies that have made our history and the image of “Made in Italy”.

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Ambrose sees is happening, but doesn’t know why.

Eurozone Dodges Recession But Submerges In ‘Lost Decade’ (AEP)

The eurozone has averted a triple-dip recession but remains stuck in a deep structural slump, with too little momentum to create jobs or to stop a relentless rise in debt ratios. The region eked out growth of 0.2pc in the third quarter, yet Italy’s economy shrank again and has now been in contraction for over three years. Stefano Fassina, the former Italian finance minister, said “Titanic Europe” is heading for a shipwreck without a radical change of course. He warned that contractionary policies are destroying the Italian economy and called on the country’s leaders to “bang their fists of the table”. He said they should threaten an “orderly break-up” of the euro unless policies change. His comments have made waves in Rome since he is a respected figure in the ruling Democratic Party of Matteo Renzi.

While France rebounded by 0.3pc, the jump was due to a rise in inventories and a 0.8pc spike in public spending, mostly on health care. The previous quarter was revised down to minus 0.1pc. “It flatters to deceive,” said Marc Ostwald from Monument Securities. “France was basically horrible. How anybody could celebrate this as a recovery story is beyond me.” “A close reading of details is sobering. Just about all the drivers of growth are near-dead,” said Denis Ferrand, head of the French research institute Coe-Rexecode. Michel Sapin, the French finance minister, said the economy remains “too weak” to make a dent on unemployment. France’s brief rebound in employment has already sputtered out. The economy shed 34,000 jobs in the third quarter. This will not be easy to reverse since Paris has pledged to push through a further €50bn of fiscal cuts over three years to meet EU deficit targets.

Maxime Alimi from Axa said France’s public debt is likely to reach 100pc of GDP by 2017, warning that investor patience may not last. He said bond yields could rise in a “non-linear, abrupt fashion” in the next downturn. Europe is caught in limbo. The data is not weak enough to force a radical change in EMU policy, whether that might be a ‘New Deal’ blitz of investment or full-fledged quantitative easing by the European Central Bank. The risk is that the currency bloc will drift into another year in near deflationary conditions, without any catalyst for real recovery. The US Treasury Secretary, Jacob Lew, warned this week that Europe faces a “lost decade” unless surplus countries such as Germany do more to stimulate demand. “The eurozone is the epicentre of a global Keynes liquidity trap,” said Lena Komileva from G+Economics. “For the markets, the previous consensus of a periphery-led recovery has crumbled.”

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” Over the past several years, loans outstanding and other exposure to China have roughly quadrupled to more than $800 billion.” Wanna bet it’s more than that?

Who Will Pay for China’s Bust? (Bloomberg)

One reason not to worry about a Chinese credit bubble is that most of the lenders are inside the country. If there’s a wave of defaults, the logic goes, it won’t affect the global financial system in the same way as the U.S. subprime crisis in 2008.

Judging from data on global bank exposures to China, this argument is rapidly becoming less convincing.

Over the past several years, loans outstanding and other exposure to China have roughly quadrupled to more than $800 billion, according to the Bank for International Settlements, an international organization of central banks (see chart). Add in about $170 billion in derivatives, credit commitments and guarantees, and the total comes to about $1 trillion.

ChinaOne20141113

It’s hard to know how much of that money is used to finance the construction of buildings that won’t be filled, excess steelmaking capacity or other misadventures. The BIS does know that the cash is mostly going to Chinese banks, followed by non-bank companies.

ChinaTwo20141113

Australian banks have increased their exposure to China at the fastest pace over the past five years, though U.K. banks still account for the largest share of lending.

ChinaThree20141113

Knowing more about who stands to take the biggest losses would be crucial to managing the global repercussions of a Chinese credit bust. Unfortunately, six years after the financial crisis of 2008, the world’s regulators are still very far from possessing an early-warning system that would allow them to identify – in anything close to real time – concentrations of risk. This weekend’s Group of 20 summit in Brisbane, Australia, would be a good place to try to make some progress in building that system.

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It’s getting hard(er) for China to hide behind its official numbers.

China Slowdown Deepens as Targeted Stimulus Fails (Bloomberg)

Credit growth in China weakened last month, adding to signs that the world’s second-largest economy slowed further this quarter and testing policy makers’ determination to avoid broader stimulus measures. Aggregate financing in October was 662.7 billion yuan ($108 billion), the People’s Bank of China’s said in Beijing yesterday, down from 1.05 trillion yuan in September and lower than the 887.5 billion yuan median estimate in a Bloomberg survey of analysts. Earlier this week, reports showed deceleration in industrial output and fixed-asset investment. The evidence underscores concern that, outside the U.S., the global economic outlook is deteriorating. For Premier Li Keqiang, the question is whether to stick with targeted liquidity injections or embrace nationwide monetary or fiscal easing that reignites the risk of a jump in debt. “The key is not to further expand credit, given the weak credit demand, but to lower funding costs,” said Wang Tao, chief China economist at UBS in Hong Kong. A benchmark interest rate cut “is more urgent.”

The central bank has added liquidity while refraining from broad-based interest rate or reserve requirement ratio cuts. China’s benchmark money-market rate fell for a second week on speculation it will conduct more targeted fund injections. New local-currency loans were 548.3 billion yuan, and M2 (CNMS2YOY) money supply grew 12.6% from a year earlier. New yuan loans, which measure new lending minus loans repaid, compared with economists’ median estimate of 626.4 billion yuan, while the M2 figure compared with the median estimate of 12.9%. “Sluggish domestic demand and risk-aversion among commercial banks dragged credit growth,” said Zhou Hao, a Shanghai-based economist at Australia & New Zealand. “Disappointing monetary data suggest overall growth will remain soft in the last quarter.”

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And don’t you forget it. Nobody’s holding your hand anymore.

Take Cover Now – They Don’t Ring A Bell At The Top (David Stockman)

This is getting downright stupid. After the minor 8% correction in October, the dip buyers came roaring back and the shorts got sent to the showers still another time. Earlier this morning the S&P 500 was pushing 2050 – or up 12% in less than a month. So the great con game remains in tact. The casinos run by the Fed and other central banks can’t go down for more than a few of days – until one or another central banker hints that more free money is on the way. A few weeks ago it was James Bullard hinting at a QE extension. Next was Mario Draghi pronouncing that the whole ECB is unified behind a plan to expand its already swollen balance sheet by another $1.2 trillion.

And then Haruhiko Kuroda, the certifiable madman running the BOJ, not only announced his 80 trillion yen buying scheme, but soon averred that falling oil prices – a godsend to Japan – were actually a threat to his mindless 2% inflation goal that might necessitate even more money printing. That is, after buying up 100% of the massive Japanese government bond market, the BOJ would not hesitate to monetize ETF’s, stocks, securitized real estate debt and, apparently, sea shells, if necessary. Accordingly, bounteous wealth is seemingly to be had by the three second exercise of clicking “buy” on the SPU (basket of S&P 500 stocks). Indeed, for the past 68 months running, the stock market has blown through every mini-correction, and has been traversing a near parabolic rise.

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Big call for imminent rate hike from a so far pretty quiet voice inside the Fed.

Asset Bubbles Are Top Concern for US Heartland’s Fed Banker (Bloomberg)

As a Federal Reserve bank examiner in the mid-1980s, Esther George delivered bad news to a Nebraska banker: she was downgrading overdue loans, putting his firm’s survival on the line. The owner “broke down and said, ‘This was my life’s work and your decisions are taking my bank away from me,’” George, now president of the Federal Reserve Bank of Kansas City, said in an interview. “I was absolutely sympathetic. I knew what it meant for the community.” The man was a victim of the early 1980s speculative bubble that George witnessed firsthand. Today, after the crisis of 2008-9, she sees aggressive lending and lofty asset-price valuations as evidence that financial excesses may again pose a risk to the economy. To forestall another bubble, George, 56, says it’s time for the Fed to start raising interest rates it has kept near zero since 2008. She argues that ultra-cheap credit is no longer needed to support an expansion that’s in its sixth year after the worst recession since the 1930s.

“The Fed took pretty aggressive action because we were in a fairly desperate situation,” George said. “Once we saw the economy turn, we might have removed some of those emergency measures, including zero interest rates.” Her concern with financial stability prompted her to dissent against the Fed’s accommodative policy at seven of eight Fed meetings last year. Now her warnings, along with those of fellow regional Fed bank presidents including Richard Fisher of Dallas and Charles Plosser of Philadelphia, are starting to resonate at a central bank dominated by its Washington-based Board of Governors. St. Louis Fed President James Bullard today called financial imbalances “my biggest worry going forward,” and said the Fed must avoid fanning a boom like the one in housing that could lead to another bust.

“Asset-price bubbles are the elephant in the room for monetary policy in the U.S.,” he told reporters after a speech in St. Louis. Fed officials including Chair Janet Yellen have said they are watching deteriorating leveraged-loan underwriting standards, and the central bank in September created a committee on financial stability under Vice Chairman Stanley Fischer. ‘Esther George has centered attention on the issue,’’ said Lawrence Goodman, a former U.S. Treasury official who is now president of the Center for Financial Stability in New York, an independent research organization. “There are an increasing number of converts at the Fed that financial stability matters.”

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Bullard follows up on Esther George’s remarks and makes sure they’ll keep on guessing. As I said before, all Fed utterances are carefully scripted.

Fed’s Bullard Still Wants Rate Rise in Q1 2015 (Dow Jones)

Federal Reserve Bank of St. Louis President James Bullard said low inflation in the U.S. economy is no longer enough to justify the current rock bottom setting for short-term interest rates, and he repeated his view that rates should be lifted off their current near zero levels early next year. “Inflation at the current level is not enough to justify remaining at a near-zero policy rate,” Mr. Bullard said in a speech in St. Louis. “Low inflation can justify a policy rate somewhat lower than normal, but not zero.” “Labor markets continue to improve and are approaching or even exceeding normal performance levels,” Mr. Bullard said. “Over the next year, it will become more and more difficult to point to labor market performance as a rationale for a near-zero policy rate.” He told reporters after his formal remarks that his continued expectation of 3% growth and job gains through next year means “that the best time to raise the policy rate will be at the end of the first quarter of 2015.” Mr. Bullard added, “That’s based on a forecast; data could come in differently.”

In his speech, Mr. Bullard took stock of the robust gains seen in the job market, which have come at a time where inflation has run persistently below the Fed’s 2% price rise target. In a speech Thursday, New York Fed President William Dudley said ongoing labor market weakness and inflation that is falling short of the Fed’s goal argue in favor of patience when it comes to raising rates. He, like many other Fed officials, expects short-term rates to be raised from near zero levels some time next year. In his speech Friday, however, Mr. Bullard said that the job market had recovered enough to reach long-term trend levels, and that justifies changing Fed policy. Mr. Bullard expressed some caution about the current level of inflation, which is currently at a tepid 1.4% rise, having persistently fallen short of the Fed’s goals. But he also said that despite some warning signs, he still expects prices to move back toward 2%.

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Big smile on my part.

Turkish Hackers Crack Electric Utility; Delete $670 Billion Of Pending Bills (ZH)

RedHack – a Turkish hacker collective – has hacked the website of the Turkey Electricity Transmission Company, and, as TechWorm reports, claim to have deleted the pending bills of Turkish citizens amounting to Turkish Lira 1.5 trillion (a stunning $668.5 billion). The collective, which has many hacktivism projects against Turkey’s internet censorship laws, posted a video of how they deleted the debt of millions of Turks. As TechWorm reports,

RedHack the Turkey’s number one hacker collective today hacked into the website of the Turkey Electricity Transmission Company website. They then did something which will cheer a lot of Turkish citizens who owe large amounts to the Electricity department. They have claimed that they have deleted the pending bill of Turkish citizens amounting to Turkish Lira 1.5 trillion.

Redhack, are a Turkish hacker collective. They follow the Marxist–Leninist ideology and were founded in 1997. The RedHack has so far hacked several high profile Turkish websites like Council of Higher Education, Turkish police forces, the Turkish Army, Türk Telekom, and the National Intelligence Organization and many other websites.

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“Somebody who is knowledgeable and interested, is several clicks away from the ugly mess that will define California’s financial future,”

California Pension Funds Are Running Dry (LA Times)

A decade ago, many of California’s public pension plans had plenty of money to pay for workers’ retirements. All that has changed, according to a far-reaching package of data from the state controller. Taxpayers are now on the hook for billions of dollars more to cover the future retirements of public workers, with the bill widely varying depending on where they live. The City of Los Angeles Fire and Police Pension System, for instance, had more than enough funds in 2003 to cover its estimated future bill for workers’ retirement checks. A decade later, it is short $3 billion. The state’s pension goliath, the California Public Employees’ Retirement System, had $281 billion to cover the benefits promised to 1.3 million workers and retirees in 2013. Yet it needed an additional $57 billion to meet future obligations.

The bill at the state teachers’ pension fund is even higher: It has an estimated shortfall of $70 billion. The new data from a website created by state Controller John Chiang come at a time of growing anger from taxpayers over the skyrocketing cost of public workers’ retirements. Until now, the bill for those government pensions was buried deep in the funds’ financial reports. By making this data available, Chiang is bound to stir debate about how taxpayers can afford to make retirement more comfortable for public workers when private-sector employees’ own financial futures have become less secure. For most non-government workers, fixed monthly pensions are increasingly rare.

“Somebody, who is knowledgeable and interested, is several clicks away from the ugly mess that will define California’s financial future,” said Dan Pellissier, president of California Pension Reform, a Sacramento-area group seeking to stem rising statewide retirement costs. Chiang has assembled reams of data from 130 public pension plans run by the state, cities and other government agencies. It’s now accessible at his website, ByTheNumbers.sco.ca.gov. In nearly eight years as controller, essentially the state’s paymaster, Chiang has made good on a commitment to make government financial records more transparent and accessible.

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” .. he speaks with a powerful moral authority — something totally missing from American political leaders who are ideologically guided by atheist Ayn Rand.”

Pope Francis’s ‘Holy War’ On Capitalism And Toxic Inequality (Paul B. Farrell)

Big first-year anniversary for anticapitalist, anticonservative, socialist Pope Francis. Fortune magazine ranks him first among the “World’s 50 Greatest Leaders.” Tenure unlimited. Now he’s in an ideological war with U.S. Senate Majority boss Mitch McConnell’s Big Oil backed GOP as well as conservative ideologues. At war in America’s unstable, endlessly fickle, myopic, rigged political arena. At least till 2016. Then another twist. Warren Buffett predicts Hillary Clinton is next, probably till 2024. In a long war. Big picture: Economics trumps the political soap opera. Lurking in the shadows, a new crash. Inevitable.

And like 2000, nobody will hear it coming … hidden under irrational exuberance, dot-com mania, millennium celebrations … followed by a 30-month bear recession … later the 2008 crash … Alan Greenspan, Henry Paulson clueless … two crashes already this century … $10 trillion losses each … next one coming in 2016 election cycle, with echoes of the McCain/Palin loss … yes, a bigger badder bear than 2000 and 2008 … because once again bulls and optimists, traders and leaders fall into denialism … blinded by a new wave of irrational exuberance.

What about the promise of big political changes? House Speaker John Boehner and McConnell talk a good game, but their anxious, conservative GOP base is sitting on the shifting tar sands of Big Oil cash threatened by higher costs, long-term risks. Yes, talk is cheap, but once partisan conflicts blow up, climate disasters will bury the GOP’s aggressive energy agenda, support will fade. Yes, Pope Francis is celebrating his one-year anniversary since laying down his anticapitalism manifesto for his army of 1.2 billion Catholics worldwide. He’s also been removing conservative cardinals and bishops from leadership roles. He’s hell-bent on changing the world fast. And his mandate is unwavering and unequivocal. He’s drawing clear moral and political battle lines against repressive capitalism, excessive consumerism, rigid conservatism.

Listen: “Inequality is the root of social ills … as long as the problems of the poor are not radically resolved by rejecting the absolute autonomy of markets and financial speculation and by attacking the structural causes of inequality, no solution will be found for the world’s problems or, for that matter, to any problems.” Yes, it sure sounds like a declaration of war: The anticapitalist Pope Francis versus America’s self-destructive amoral capitalism. Bet on Mitch? Pope Francis’s target is clear: economic inequality is the world’s No. 1 problem. Capitalism is at the center of all problems of inequality. And he speaks with a powerful moral authority — something totally missing from American political leaders who are ideologically guided by atheist Ayn Rand, patron saint of the GOP’s capitalism agenda in this moral war. Without moral grounding, the GOP is no match for Francis’ vision, his principled mandate, his long-game strategy to raise the world’s billions out of poverty, to eliminate inequality, to attack the myopic capitalism driving today’s economy, markets and political system.

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