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CIA director is said to have warned Russia of "consequences" if it"s found to be behind the "Havana Syndrome" illnesses hurting US personnel around the world

William J. Burns confronted the heads of Russia's security and intelligence agencies in Moscow but did not blame Russia, The Washington Post reported. Russian President Vladimir Putin.Photo by Mikhail Svetlov/Getty Images US personnel have reported brain damage and other symptoms of the mysterious "Havana Syndrome." CIA Director Bill Burns warned Russian intel services over the cases, The Washington Post reported. The warning was hedged, suggesting the US doesn't know if Russia is involved, the report said. The CIA director warned Russia of "consequences" if the country turns out to be behind the "Havana Syndrome" illnesses afflicting American personnel around the world, The Washington Post reported, citing US officials.Bill Burns gave the warning confidentially to the heads of Russia's security and intelligence agencies while he was in Moscow earlier this month, The Post reported, citing the unnamed officials.The Post noted that Burns tempered his warning by saying that the consquences would come "if" Russia was found to be involved in US personnel falling ill.The Post noted that the US did not blame Russia, and that the way the warning was delivered suggests the US does not yet know the cause of the illnesse or whether Russia had a role at all.More than 200 Americans across the world have reported a mysterious illness with symptoms that include nausea, headaches, vertigo, and memory loss. Some have reported brain damage.The cause of it remains unknown, and theories include a microwave weapon.It was nicknamed "Havana Syndrome" as it was first reported among US personnel in Havana, Cuba, in 2016.The US is working to try and understand its source.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderNov 25th, 2021

Countries contributing the least to the climate crisis are feeling the worst of its effects

Some of those countries include Bangladesh, India, Philippines, and multiple countries in sub-Saharan Africa, the Caribbean, and South America. In this Sept. 25, 2015, file photo, a woman holds her daughter stands awaiting her husband who went to collect drinking water after flood waters enter their house following heavy monsoon rains in Gauhati, India. Anupam Nath, File/Associated Press More than 1 billion children are at extreme risk for weather disasters, a UNICEF report found. The majority of these kids live in countries that contribute the least to carbon emissions. High-risk countries are already facing extreme heat, water scarcity, flooding and other impacts. Tahsin Uddin, a 23-year-old climate activist who lives in the southern city of Barisal in Bangladesh, has already lost one family home to coastal flooding and rising sea levels. Within the next few years, he expects his current home to be submerged under water as well.Uddin is just one of the millions of Bangladeshis and others across the globe facing the brutal consequences of the climate crisis.By 2050, more than 20 million Bangladeshis will be displaced and nearly 20% of the country's land will be underwater because of rising sea levels, a direct impact of the changing climate, according to the Natural Resources Defense Council, a nonprofit climate advocacy group.Uddin told Insider the impact of those rising sea levels can be seen throughout the country: "I go to different coastal areas. I saw how much people are suffering. They are trying to survive by drinking salty water. Saline water is very dangerous for their health."While the consequences of climate change are pummeling Bangladesh, it contributes very little to carbon emissions. Villagers wade through waist-deep waters to reach their homes in Pratap Nagar that lies in the Shyamnagar region, in Satkhira, Bangladesh on Oct. 5, 2021 Mahmud Hossain Opu/AP Photo In 2020, more than 34 billion metric tons of carbon (CO2) were emitted worldwide, but the countries that contributed the least to that total are already facing some of the most significant impacts of the climate crisis.A UNICEF report published in August found more than 1 billion children, nearly half the world's kids, lived in places with a high risk of extreme weather events. The 33 countries where the climate crisis poses the most risk to children contributed only 9% of global CO2 emissions, while 70% of emissions were attributed to just 10 countries.A 2016 study found 20 of the 36 highest-emitting countries were among the least vulnerable to the effects of a warming climate, while 11 of the 17 countries with low or moderate emissions were significantly vulnerable.Some of the countries with low emissions per capita that are at a high risk include Bangladesh, India, Philippines, and multiple countries in sub-Saharan Africa, the Caribbean, and South America.They are facing heat waves, water scarcity, coastal flooding, and water-borne disease, among other hazards, which in turn can lead to poor sanitation, lack of food, scarce income, and deteriorating living conditions. Meanwhile, many of the places currently experiencing these effects lack the infrastructure or resources to mitigate them.Experts and climate activists have said that while countries contributing the most need to reduce emissions, poorer countries are in need of immediate funding to address current challenges.Heat waves have killed thousands in India in recent yearsIn the summer of 2019, large swaths of India were scorched by temperatures greater than 113 degrees Fahrenheit for nearly three weeks. In some regions, officials closed local schools. Medical authorities canceled time off for doctors to ensure hospitals could handle the influx of patients.Four passengers fell ill on board an express train that lacked air conditioning, and died by the time the train reached a station in Jhansi, south of New Delhi."Shortly after we left Agra, the heat became unbearable and some people started complaining of breathing problems and uneasiness. Before we could get some help, they collapsed," a passenger told India Today.By the end of that summer heat wave, more than 200 people had died. The heat wave of 2015 was far worse, with extreme heat causing the deaths of more than 2,000 people. In the past decade, more than 6,000 people in India have died as a result of excessive heat, according to government data. In this Thursday, May 30, 2019, file photo, children returning from school walk through a dried pond on a hot summer day on the outskirts of Jammu, India. Channi Anand, File/Associated Press "Climate change is leading to more frequent, more intense, and longer heat waves around the world," said Olga Wilhelmi, a scientist at the National Center for Atmospheric Research, adding that the link has been well-documented.An estimated 820 million children, more than a third of kids worldwide, are highly exposed to heat waves, according to the UNICEF report."Extreme heat is probably one of the least appreciated weather hazards, but it's actually one of the more deadly weather hazards in the US and worldwide," Wilhelmi said. "Studies show that in the US, somewhere on average between 600 and 1,800 people die from extreme heat every year, but we don't usually read about that in the news."Health complications of extreme heat can vary from dehydration to heatstroke. Heat waves can also exacerbate cardiovascular and respiratory diseases. Groups at a higher risk include older people, children, people with pre-existing conditions, and those who are lower-income and do not have access to air conditioning.Heat waves can also shut down electric grids when they don't have the capacity to handle the increased demand for air conditioning.Lack of water leads to poverty and hunger Water scarcity, the lack of adequate access to clean water, is another way people are feeling the climate crisis.While scarcity can be due to institutional failures to deliver water, in many instances it's due to dwindling water sources or growing populations that need more water. More than a third of kids worldwide, 920 million are currently highly exposed to water scarcity. This issue affects kids in various parts of the world including parts of India, South America, Australia, and the Middle East. For example, while parts of India are at extreme risk of scarcity, the country only contributed to 3.14% of overall emissions in 2019. Tonchuiwon Tinphei, 34, right, and her sister-in-law Chirmi carry water in baskets and walk home on the eve of World Water Day in Shangshak village, in the northeastern Indian state of Manipur, Saturday, March 21, 2020. Yirmiyan Arthur/AP Photo Greg Pierce, the co-director of the Water Resources Group: Institute of the Environment and Sustainability at UCLA, told Insider the biggest effect could be felt in rural areas. Pierce said rural areas tend to be poorer and have one water source. Residents are usually already walking long distances to get to that water which may not always be clean. Water isn't just needed for drinking, but for producing and selling agriculture. Water is very much tied to livelihoods. "The scarcity issue makes it harder to do agriculture, which is what most rural populations rely on for livelihoods. So, there's a hunger, inability to grow food and inability to earn any money," Pierce told Insider. "That lack of water leads directly to people starving and that is going to become a lot more common, unfortunately again, in many parts of the world."When those resources dry up, residents would be forced to travel even further or move, further straining resources. While many parts of India are dealing with water scarcity, other regions are also experiencing flooding, Pierce said. However, the flooding comes with other complications and doesn't counter the consequences of water scarcity. Coastal flooding, which destroys property and resources, is already taking a heavy toll in BangladeshIn Uddin's home of Bangladesh, rising seas and extreme precipitation have inundated communities with flooding in recent years.The village of Bonnotola, once home to more than 2,000 people, has less than 500 residents left, as the flooding and salt water-tainted soil destroyed many people's homes and livelihoods, the Associated Press reported.One woman from the village of Gabura told AP everyone used to grow food in their backyards, but that salt water flooding has disrupted the once-fertile lands and freshwater that many relied on."We have water everywhere, but we don't have a drop anymore to drink from ponds or wells," she said.Almost every ocean on Earth is experiencing a sea-level rise, according to William Sweet, an oceanographer at the National Oceanic and Atmospheric Administration.One in 10 children, or 240 million, are currently exposed to coastal flooding, according to the UNICEF report. Sea-level rise is exacerbated by extreme rainfall events, which are also a consequence of warming."The same heating that's causing oceans to rise, ice caps and ice sheets to melt, and oceans to expand, is also enabling more moisture to be held within the atmosphere," Sweet said, adding that the result is frequent heavy rains. "The combined effect of course is flooding with nowhere for that water to go."While the threat of entire cities being underwater is the most commonly talked about result of rising sea levels, there are many significant issues that arise well before a city or property is actually underwater."It's not when you're underwater, it's when the system fails," Sweet said, adding that flooding can overwhelm infrastructure and destroy roadways, stormwater and wastewater systems, and people's personal property.He said by the time areas are actually underwater, people are already gone by then, driven out by the flooding. Bangladeshi flood victim man carrying their houses by boat during flood in Kurigram, Bangladesh on July 27, 2019. zakir hossain chowdhury / Barcroft Media via Getty Images Coastal flooding creates more problems where water infrastructure is lacking, Pierce told Insider."Flooding doesn't typically increase water supply. It can have a direct impact on water-borne illness, especially because there's poor sanitation in a lot of places and when there's flooding, it gets into wherever the waste is being contained or into the open sewers and spreads," he said. Diseases are becoming more prevalent in sub-Saharan Africa and South America because of the climate crisisAs temperatures rise, cities flood and water becomes scarce, there's also a rise of waterborne illnesses with an estimated 600 million children currently exposed to diseases like malaria and dengue fever, according to the UNICEF report. The impact can be most immediately felt in countries in sub-Saharan Africa and South America. Martin Muchangi, AMREF water and sanitation specialist based in Kenya, told Insider he studies waterborne illnesses across much of sub-Saharan Africa, and that a vast majority of people are dealing with water scarcity which in turn is driving up waterborne diseases.Muchangi said the issue is twofold: changing temperatures pushing things like mosquitoes into more places and increasing pathogens that cause diarrhea illnesses like cholera and typhoid and the lack of water leading to poor hygiene and diseases like scabies or glaucoma. He told Insider the problem is leading to harming both people and the economy. "So now at the end of the day, if you combine the sum total, you realize that there's major economic loss, there's serious effects to the health, there's serious effects to the thriving of children," he said. Many countries facing the worst of the climate crisis also have the least resources to address it While nowhere on earth will escape the effects of the climate crisis, some countries have infrastructure and resources that make them more prepared to respond.Pierce told Insider many of the impacts can be mitigated with robust public health initiatives and proper infrastructure. Water filtration systems, for example, can mitigate the risks of water-borne disease.Muchangi and Uddin told Insider the countries they live and work in, however, don't have the funds they need to address the issues they're facing. In Bangladesh, Uddin said funding is needed to direct towards researching ways to remove salt from saltwater and towards building infrastructure that can withstand flooding, including fortifying schools, hospitals, homes, and other essential buildings. Muchangi said that while finding ways to mitigate the immediate impacts of the changing climate is necessary, limiting CO2 emissions would greatly reduce the burden."If we are able to alleviate climate change itself, then the effects of climate change are going to become lesser and we are going to be able to thrive in a better way," he said.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderNov 13th, 2021

Bitcoin & The US Fiscal Reckoning

Bitcoin & The US Fiscal Reckoning Authored by Avik Roy via NationalAffairs.com, Cryptocurrencies like bitcoin have few fans in Washington. At a July congressional hearing, Senator Elizabeth Warren warned that cryptocurrency "puts the [financial] system at the whims of some shadowy, faceless group of super-coders." Treasury secretary Janet Yellen likewise asserted that the "reality" of cryptocurrencies is that they "have been used to launder the profits of online drug traffickers; they've been a tool to finance terrorism." Thus far, Bitcoin's supporters remain undeterred. (The term "Bitcoin" with a capital "B" is used here and throughout to refer to the system of cryptography and technology that produces the currency "bitcoin" with a lowercase "b" and verifies bitcoin transactions.) A survey of 3,000 adults in the fall of 2020 found that while only 4% of adults over age 55 own cryptocurrencies, slightly more than one-third of those aged 35-44 do, as do two-fifths of those aged 25-34. As of mid-2021, Coinbase — the largest cryptocurrency exchange in the United States — had 68 million verified users. To younger Americans, digital money is as intuitive as digital media and digital friendships. But Millennials with smartphones are not the only people interested in bitcoin; a growing number of investors are also flocking to the currency's banner. Surveys indicate that as many as 21% of U.S. hedge funds now own bitcoin in some form. In 2020, after considering various asset classes like stocks, bonds, gold, and foreign currencies, celebrated hedge-fund manager Paul Tudor Jones asked, "[w]hat will be the winner in ten years' time?" His answer: "My bet is it will be bitcoin." What's driving this increased interest in a form of currency invented in 2008? The answer comes from former Federal Reserve chairman Ben Bernanke, who once noted, "the U.S. government has a technology, called a printing press...that allows it to produce as many U.S. dollars as it wishes at essentially no cost. By increasing the number of U.S. dollars in circulation...the U.S. government can also reduce the value of a dollar in terms of goods and services, which is equivalent to...inflation." In other words, governments with fiat currencies — including the United States — have the power to expand the quantity of those currencies. If they choose to do so, they risk inflating the prices of necessities like food, gas, and housing. In recent months, consumers have experienced higher price inflation than they have seen in decades. A major reason for the increases is that central bankers around the world — including those at the Federal Reserve — sought to compensate for Covid-19 lockdowns with dramatic monetary inflation. As a result, nearly $4 trillion in newly printed dollars, euros, and yen found their way from central banks into the coffers of global financial institutions. Jerome Powell, the current Federal Reserve chairman, insists that 2021's inflation trends are "transitory." He may be right in the near term. But for the foreseeable future, inflation will be a profound and inescapable challenge for America due to a single factor: the rapidly expanding federal debt, increasingly financed by the Fed's printing press. In time, policymakers will face a Solomonic choice: either protect Americans from inflation, or protect the government's ability to engage in deficit spending. It will become impossible to do both. Over time, this compounding problem will escalate the importance of Bitcoin. THE FIAT-CURRENCY EXPERIMENT It's becoming clear that Bitcoin is not merely a passing fad, but a significant innovation with potentially serious implications for the future of investment and global finance. To understand those implications, we must first examine the recent history of the primary instrument that bitcoin was invented to challenge: the American dollar. Toward the end of World War II, in an agreement hashed out by 44 Allied countries in Bretton Woods, New Hampshire, the value of the U.S. dollar was formally fixed to 1/35th of the price of an ounce of gold. Other countries' currencies, such as the British pound and the French franc, were in turn pegged to the dollar, making the dollar the world's official reserve currency. Under the Bretton Woods system, foreign governments could retrieve gold bullion they had sent to the United States during the war by exchanging dollars for gold at the relevant fixed exchange rate. But enabling every major country to exchange dollars for American-held gold only worked so long as the U.S. government was fiscally and monetarily responsible. By the late 1960s, it was neither. Someone needed to pay the steep bills for Lyndon Johnson's "guns and butter" policies — the Vietnam War and the Great Society, respectively — so the Federal Reserve began printing currency to meet those obligations. Johnson's successor, Richard Nixon, also pressured the Fed to flood the economy with money as a form of economic stimulus. From 1961 to 1971, the Fed nearly doubled the circulating supply of dollars. "In the first six months of 1971," noted the late Nobel laureate Robert Mundell, "monetary expansion was more rapid than in any comparable period in a quarter century." That year, foreign central banks and governments held $64 billion worth of claims on the $10 billion of gold still held by the United States. It wasn't long before the world took notice of the shortage. In a classic bank-run scenario, anxious European governments began racing to redeem dollars for American-held gold before the Fed ran out. In July 1971, Switzerland withdrew $50 million in bullion from U.S. vaults. In August, France sent a destroyer to escort $191 million of its gold back from the New York Federal Reserve. Britain put in a request for $3 billion shortly thereafter. Finally, that same month, Nixon secretly gathered a small group of trusted advisors at Camp David to devise a plan to avoid the imminent wipeout of U.S. gold vaults and the subsequent collapse of the international economy. There, they settled on a radical course of action. On the evening of August 15th, in a televised address to the nation, Nixon announced his intention to order a 90-day freeze on all prices and wages throughout the country, a 10% tariff on all imported goods, and a suspension — eventually, a permanent one — of the right of foreign governments to exchange their dollars for U.S. gold. Knowing that his unilateral abrogation of agreements involving dozens of countries would come as a shock to world leaders and the American people, Nixon labored to re-assure viewers that the change would not unsettle global markets. He promised viewers that "the effect of this action...will be to stabilize the dollar," and that the "dollar will be worth just as much tomorrow as it is today." The next day, the stock market rose — to everyone's relief. The editors of the New York Times "unhesitatingly applaud[ed] the boldness" of Nixon's move. Economic growth remained strong for months after the shift, and the following year Nixon was re-elected in a landslide, winning 49 states in the Electoral College and 61% of the popular vote. Nixon's short-term success was a mirage, however. After the election, the president lifted the wage and price controls, and inflation returned with a vengeance. By December 1980, the dollar had lost more than half the purchasing power it had back in June 1971 on a consumer-price basis. In relation to gold, the price of the dollar collapsed — from 1/35th to 1/627th of a troy ounce. Though Jimmy Carter is often blamed for the Great Inflation of the late 1970s, "the truth," as former National Economic Council director Larry Kudlow has argued, "is that the president who unleashed double-digit inflation was Richard Nixon." In 1981, Federal Reserve chairman Paul Volcker raised the federal-funds rate — a key interest-rate benchmark — to 19%. A deep recession ensued, but inflation ceased, and the U.S. embarked on a multi-decade period of robust growth, low unemployment, and low consumer-price inflation. As a result, few are nostalgic for the days of Bretton Woods or the gold-standard era. The view of today's economic establishment is that the present system works well, that gold standards are inherently unstable, and that advocates of gold's return are eccentric cranks. Nevertheless, it's important to remember that the post-Bretton Woods era — in which the supply of government currencies can be expanded or contracted by fiat — is only 50 years old. To those of us born after 1971, it might appear as if there is nothing abnormal about the way money works today. When viewed through the lens of human history, however, free-floating global exchange rates remain an unprecedented economic experiment — with one critical flaw. An intrinsic attribute of the post-Bretton Woods system is that it enables deficit spending. Under a gold standard or peg, countries are unable to run large budget deficits without draining their gold reserves. Nixon's 1971 crisis is far from the only example; deficit spending during and after World War I, for instance, caused economic dislocation in numerous European countries — especially Germany — because governments needed to use their shrinking gold reserves to finance their war debts. These days, by contrast, it is relatively easy for the United States to run chronic deficits. Today's federal debt of almost $29 trillion — up from $10 trillion in 2008 and $2.4 trillion in 1984 — is financed in part by U.S. Treasury bills, notes, and bonds, on which lenders to the United States collect a form of interest. Yields on Treasury bonds are denominated in dollars, but since dollars are no longer redeemable for gold, these bonds are backed solely by the "full faith and credit of the United States." Interest rates on U.S. Treasury bonds have remained low, which many people take to mean that the creditworthiness of the United States remains healthy. Just as creditworthy consumers enjoy lower interest rates on their mortgages and credit cards, creditworthy countries typically enjoy lower rates on the bonds they issue. Consequently, the post-Great Recession era of low inflation and near-zero interest rates led many on the left to argue that the old rules no longer apply, and that concerns regarding deficits are obsolete. Supporters of this view point to the massive stimulus packages passed under presidents Donald Trump and Joe Biden  that, in total, increased the federal deficit and debt by $4.6 trillion without affecting the government's ability to borrow. The extreme version of the new "deficits don't matter" narrative comes from the advocates of what has come to be called Modern Monetary Theory (MMT), who claim that because the United States controls its own currency, the federal government has infinite power to increase deficits and the debt without consequence. Though most mainstream economists dismiss MMT as unworkable and even dangerous, policymakers appear to be legislating with MMT's assumptions in mind. A new generation of Democratic economic advisors has pushed President Biden to propose an additional $3.5 trillion in spending, on top of the $4.6 trillion spent on Covid-19 relief and the $1 trillion bipartisan infrastructure bill. These Democrats, along with a new breed of populist Republicans, dismiss the concerns of older economists who fear that exploding deficits risk a return to the economy of the 1970s, complete with high inflation, high interest rates, and high unemployment. But there are several reasons to believe that America's fiscal profligacy cannot go on forever. The most important reason is the unanimous judgment of history: In every country and in every era, runaway deficits and skyrocketing debt have ended in economic stagnation or ruin. Another reason has to do with the unusual confluence of events that has enabled the United States to finance its rising debts at such low interest rates over the past few decades — a confluence that Bitcoin may play a role in ending. DECLINING FAITH IN U.S. CREDIT To members of the financial community, U.S. Treasury bonds are considered "risk-free" assets. That is to say, while many investments entail risk — a company can go bankrupt, for example, thereby wiping out the value of its stock — Treasury bonds are backed by the full faith and credit of the United States. Since people believe the United States will not default on its obligations, lending money to the U.S. government — buying Treasury bonds that effectively pay the holder an interest rate — is considered a risk-free investment. The definition of Treasury bonds as "risk-free" is not merely by reputation, but also by regulation. Since 1988, the Switzerland-based Basel Committee on Banking Supervision has sponsored a series of accords among central bankers from financially significant countries. These accords were designed to create global standards for the capital held by banks such that they carry a sufficient proportion of low-risk and risk-free assets. The well-intentioned goal of these standards was to ensure that banks don't fail when markets go down, as they did in 2008. The current version of the Basel Accords, known as "Basel III," assigns zero risk to U.S. Treasury bonds. Under Basel III's formula, then, every major bank in the world is effectively rewarded for holding these bonds instead of other assets. This artificially inflates demand for the bonds and enables the United States to borrow at lower rates than other countries. The United States also benefits from the heft of its economy as well as the size of its debt. Since America is the world's most indebted country in absolute terms, the market for U.S. Treasury bonds is the largest and most liquid such market in the world. Liquid markets matter a great deal to major investors: A large financial institution or government with hundreds of billions (or more) of a given currency on its balance sheet cares about being able to buy and sell assets while minimizing the impact of such actions on the trading price. There are no alternative low-risk assets one can trade at the scale of Treasury bonds. The status of such bonds as risk-free assets — and in turn, America's ability to borrow the money necessary to fund its ballooning expenditures — depends on investors' confidence in America's creditworthiness. Unfortunately, the Federal Reserve's interference in the markets for Treasury bonds have obscured our ability to determine whether financial institutions view the U.S. fiscal situation with confidence. In the 1990s, Bill Clinton's advisors prioritized reducing the deficit, largely out of a conern that Treasury-bond "vigilantes" — investors who protest a government's expansionary fiscal or monetary policy by aggressively selling bonds, which drives up interest rates — would harm the economy. Their success in eliminating the primary deficit brought yields on the benchmark 10-year Treasury bond down from 8% to 4%. In Clinton's heyday, the Federal Reserve was limited in its ability to influence the 10-year Treasury interest rate. Its monetary interventions primarily targeted the federal-funds rate — the interest rate that banks charge each other on overnight transactions. But in 2002, Ben Bernanke advocated that the Fed "begin announcing explicit ceilings for yields on longer-maturity Treasury debt." This amounted to a schedule of interest-rate price controls. Since the 2008 financial crisis, the Federal Reserve has succeeded in wiping out bond vigilantes using a policy called "quantitative easing," whereby the Fed manipulates the price of Treasury bonds by buying and selling them on the open market. As a result, Treasury-bond yields are determined not by the free market, but by the Fed. The combined effect of these forces — the regulatory impetus for banks to own Treasury bonds, the liquidity advantage Treasury bonds have in the eyes of large financial institutions, and the Federal Reserve's manipulation of Treasury-bond market prices — means that interest rates on Treasury bonds no longer indicate the United States' creditworthiness (or lack thereof). Meanwhile, indications that investors are growing increasingly concerned about the U.S. fiscal and monetary picture — and are in turn assigning more risk to "risk-free" Treasury bonds — are on the rise. One such indicator is the decline in the share of Treasury bonds owned by outside investors. Between 2010 and 2020, the share of U.S. Treasury securities owned by foreign entities fell from 47% to 32%, while the share owned by the Fed more than doubled, from 9% to 22%. Put simply, foreign investors have been reducing their purchases of U.S. government debt, thereby forcing the Fed to increase its own bond purchases to make up the difference and prop up prices. Until and unless Congress reduces the trajectory of the federal debt, U.S. monetary policy has entered a vicious cycle from which there is no obvious escape. The rising debt requires the Treasury Department to issue an ever-greater quantity of Treasury bonds, but market demand for these bonds cannot keep up with their increasing supply. In an effort to avoid a spike in interest rates, the Fed will need to print new U.S. dollars to soak up the excess supply of Treasury bonds. The resultant monetary inflation will cause increases in consumer prices. Those who praise the Fed's dramatic expansion of the money supply argue that it has not affected consumer-price inflation. And at first glance, they appear to have a point. In January of 2008, the M2 money stock was roughly $7.5 trillion; by January 2020, M2 had more than doubled, to $15.4 trillion. As of July 2021, the total M2 sits at $20.5 trillion — nearly triple what it was just 13 years ago. Over that same period, U.S. GDP increased by only 50%. And yet, since 2000, the average rate of growth in the Consumer Price Index (CPI) for All Urban Consumers — a widely used inflation benchmark — has remained low, at about 2.25%. How can this be? The answer lies in the relationship between monetary inflation and price inflation, which has diverged over time. In 2008, the Federal Reserve began paying interest to banks that park their money with the Fed, reducing banks' incentive to lend that money out to the broader economy in ways that would drive price inflation. But the main reason for the divergence is that conventional measures like CPI do not accurately capture the way monetary inflation is affecting domestic prices. In a large, diverse country like the United States, different people and different industries experience price inflation in different ways. The fact that price inflation occurs earlier in certain sectors of the economy than in others was first described by the 18th-century Irish-French economist Richard Cantillon. In his 1730 "Essay on the Nature of Commerce in General," Cantillon noted that when governments increase the supply of money, those who receive the money first gain the most benefit from it — at the expense of those to whom it flows last. In the 20th century, Friedrich Hayek built on Cantillon's thinking, observing that "the real harm [of monetary inflation] is due to the differential effect on different prices, which change successively in a very irregular order and to a very different degree, so that as a result the whole structure of relative prices becomes distorted and misguides production into wrong directions." In today's context, the direct beneficiaries of newly printed money are those who need it the least. New dollars are sent to banks, which in turn lend them to the most creditworthy entities: investment funds, corporations, and wealthy individuals. As a result, the most profound price impact of U.S. monetary inflation has been on the kinds of assets that financial institutions and wealthy people purchase — stocks, bonds, real estate, venture capital, and the like. This is why the price-to-earnings ratio of S&P 500 companies is at record highs, why risky start-ups with long-shot ideas are attracting $100 million venture rounds, and why the median home sales price has jumped 24% in a single year — the biggest one-year increase of the 21st century. Meanwhile, low- and middle-income earners are facing rising prices without attendant increases in their wages. If asset inflation persists while the costs of housing and health care continue to grow beyond the reach of ordinary people, the legitimacy of our market economy will be put on trial. THE RETURN OF SOUND MONEY Satoshi Nakamoto, the pseudonymous creator of Bitcoin, was acutely concerned with the increasing abundance of U.S. dollars and other fiat currencies in the early 2000s. In 2009 he wrote, "the root problem with conventional currency is all the trust that's required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust." Bitcoin was created in anticipation of the looming fiscal and monetary crisis in the United States and around the world. To understand how bitcoin functions alongside fiat currency, it's helpful to examine the monetary philosophy of the Austrian School of economics, whose leading figures — especially Hayek and Ludwig von Mises — greatly influenced Nakamoto and the early developers of Bitcoin. The economists of the Austrian School were staunch advocates of what Mises called "the principle of sound money" — that is, of keeping the supply of money as constant and predictable as possible. In The Theory of Money and Credit, first published in 1912, Mises argued that sound money serves as "an instrument for the protection of civil liberties against despotic inroads on the part of governments" that belongs "in the same class with political constitutions and bills of rights." Just as bills of rights were a "reaction against arbitrary rule and the nonobservance of old customs by kings," he wrote, "the postulate of sound money was first brought up as a response to the princely practice of debasing the coinage." Mises believed that inflation was just as much a violation of someone's property rights as arbitrarily taking away his land. After all, in both cases, the government acquires economic value at the expense of the citizen. Since monetary inflation creates a sugar high of short-term stimulus, politicians interested in re-election will always have an incentive to expand the money supply. But doing so comes at the expense of long-term declines in consumer purchasing power. For Mises, the best way to address such a threat is to avoid fiat currencies altogether. And in his estimation, the best sound-money alternative to fiat currency is gold. "The excellence of the gold standard," Mises wrote, is "that it renders the determination of the monetary unit's purchasing power independent of the policies of governments and political parties." In other words, gold's primary virtue is that its supply increases slowly and steadily, and cannot be manipulated by politicians. It may appear as if gold was an arbitrary choice as the basis for currency, but gold has a combination of qualities that make it ideal for storing and exchanging value. First, it is verifiably unforgeable. Gold is very dense, which means that counterfeit gold is easy to identify — one simply has to weigh it. Second, gold is divisible. Unlike, say, cattle, gold can be delivered in fractional units both small and large, enabling precise pricing. Third, gold is durable. Unlike commodities that rot or evaporate over time, gold can be stored for centuries without degradation. Fourth, gold is fungible: An ounce of gold in Asia is worth the same as an ounce of gold in Europe. These four qualities are shared by most modern currencies. Gold's fifth quality is more distinct, however, as well as more relevant to its role as an instrument of sound money: scarcity. While people have used beads, seashells, and other commodities as primitive forms of money, those items are fairly easy to acquire and introduce into circulation. While gold's supply does gradually increase as more is extracted from the ground, the rate of extraction relative to the total above-ground supply is low: At current rates, it would take approximately 66 years to double the amount of gold in circulation. In comparison, the supply of U.S. dollars has more than doubled over just the last decade. When the Austrian-influenced designers of bitcoin set out to create a more reliable currency, they tried to replicate all of these qualities. Like gold, bitcoin is divisible, unforgeable, divisible, durable, and fungible. But bitcoin also improves upon gold as a form of sound money in several important ways. First, bitcoin is rarer than gold. Though gold's supply increases slowly, it does increase. The global supply of bitcoin, by contrast, is fixed at 21 million and cannot be feasibly altered. Second, bitcoin is far more portable than gold. Transferring physical gold from one place to another is an onerous process, especially in large quantities. Bitcoin, on the other hand, can be transmitted in any quantity as quickly as an email. Third, bitcoin is more secure than gold. A single bitcoin address carried on a USB thumb drive could theoretically hold as much value as the U.S. Treasury holds in gold bars — without the need for costly militarized facilities like Fort Knox to keep it safe. In fact, if stored using best practices, the cost of securing bitcoin from hackers or assailants is far lower than the cost of securing gold. Fourth, bitcoin is a technology. This means that, as developers identify ways to augment its functionality without compromising its core attributes, they can gradually improve the currency over time. Fifth, and finally, bitcoin cannot be censored. This past year, the Chinese government shut down Hong Kong's pro-democracy Apple Daily newspaper not by censoring its content, but by ordering banks not to do business with the publication, thereby preventing Apple Daily from paying its suppliers or employees. Those who claim the same couldn't happen here need only look to the Obama administration's Operation Choke Point, a regulatory attempt to prevent banks from doing business with legitimate entities like gun manufacturers and payday lenders — firms the administration disfavored. In contrast, so long as the transmitting party has access to the internet, no entity can prevent a bitcoin transaction from taking place. This combination of fixed supply, portability, security, improvability, and censorship resistance epitomizes Nakamoto's breakthrough. Hayek, in The Denationalisation of Money, foresaw just such a separation of money and state. "I believe we can do much better than gold ever made possible," he wrote. "Governments cannot do better. Free enterprise...no doubt would." While Hayek and Nakamoto hoped private currencies would directly compete with the U.S. dollar and other fiat currencies, bitcoin does not have to replace everyday cash transactions to transform global finance. Few people may pay for their morning coffee with bitcoin, but it is also rare for people to purchase coffee with Treasury bonds or gold bars. Bitcoin is competing not with cash, but with these latter two assets, to become the world's premier long-term store of wealth. The primary problem bitcoin was invented to address — the devaluation of fiat currency through reckless spending and borrowing — is already upon us. If Biden's $3.5 trillion spending plan passes Congress, the national debt will rise further. Someone will have to buy the Treasury bonds to enable that spending. Yet as discussed above, investors are souring on Treasurys. On June 30, 2021, the interest rate for the benchmark 10-year Treasury bond was 1.45%. Even at the Federal Reserve's target inflation rate of 2%, under these conditions, Treasury-bond holders are guaranteed to lose money in inflation-adjusted terms. One critic of the Fed's policies, MicroStrategy CEO Michael Saylor, compares the value of today's Treasury bonds to a "melting ice cube." Last May, Ray Dalio, founder of Bridgewater Associates and a former bitcoin skeptic, said "[p]ersonally, I'd rather have bitcoin than a [Treasury] bond." If hedge funds, banks, and foreign governments continue to decelerate their Treasury purchases, even by a relatively small percentage, the decrease in demand could send U.S. bond prices plummeting. If that happens, the Fed will be faced with the two unpalatable options described earlier: allowing interest rates to rise, or further inflating the money supply. The political pressure to choose the latter would likely be irresistible. But doing so would decrease inflation-adjusted returns on Treasury bonds, driving more investors away from Treasurys and into superior stores of value, such as bitcoin. In turn, decreased market interest in Treasurys would force the Fed to purchase more such bonds to suppress interest rates. AMERICA'S BITCOIN OPPORTUNITY From an American perspective, it would be ideal for U.S. Treasury bonds to remain the world's preferred reserve asset for the foreseeable future. But the tens of trillions of dollars in debt that the United States has accumulated since 1971 — and the tens of trillions to come — has made that outcome unlikely. It is understandably difficult for most of us to imagine a monetary world aside from the one in which we've lived for generations. After all, the U.S. dollar has served as the world's leading reserve currency since 1919, when Britain was forced off the gold standard. There are only a handful of people living who might recall what the world was like before then. Nevertheless, change is coming. Over the next 10 to 20 years, as bitcoin's liquidity increases and the United States becomes less creditworthy, financial institutions and foreign governments alike may replace an increasing portion of their Treasury-bond holdings with bitcoin and other forms of sound money. With asset values reaching bubble proportions and no end to federal spending in sight, it's critical for the United States to begin planning for this possibility now. Unfortunately, the instinct of some federal policymakers will be to do what countries like Argentina have done in similar circumstances: impose capital controls that restrict the ability of Americans to exchange dollars for bitcoin in an attempt to prevent the digital currency from competing with Treasurys. Yet just as Nixon's 1971 closure of the gold window led to a rapid flight from the dollar, imposing restrictions on the exchange of bitcoin for dollars would confirm to the world that the United States no longer believes in the competitiveness of its currency, accelerating the flight from Treasury bonds and undermining America's ability to borrow. A bitcoin crackdown would also be a massive strategic mistake, given that Americans are positioned to benefit enormously from bitcoin-related ventures and decentralized finance more generally. Around 50 million Americans own bitcoin today, and it's likely that Americans and U.S. institutions own a plurality, if not the majority, of the bitcoin in circulation — a sum worth hundreds of billions of dollars. This is one area where China simply cannot compete with the United States, since Bitcoin's open financial architecture is fundamentally incompatible with Beijing's centralized, authoritarian model. In the absence of major entitlement reform, well-intentioned efforts to make Treasury bonds great again are likely doomed. Instead of restricting bitcoin in a desperate attempt to forestall the inevitable, federal policymakers would do well to embrace the role of bitcoin as a geopolitically neutral reserve asset; work to ensure that the United States continues to lead the world in accumulating bitcoin-based wealth, jobs, and innovations; and ensure that Americans can continue to use bitcoin to protect themselves against government-driven inflation. To begin such an initiative, federal regulators should make it easier to operate cryptocurrency-related ventures on American shores. As things stand, too many of these firms are based abroad and closed off to American investors simply because outdated U.S. regulatory agencies — the Securities and Exchange Commission (SEC), the Commodity Futures Trading Commission, the Treasury Department, and others — have been unwilling to provide clarity as to the legal standing of digital assets. For example, the SEC has barred Coinbase from paying its customers' interest on their holdings while refusing to specify which laws Coinbase has violated. Similarly, the agency has refused to approve Bitcoin exchange-traded funds (ETFs) without specifying standards for a valid ETF application. Congress should implement SEC Commissioner Hester Peirce's recommendations for a three-year regulatory grace period for decentralized digital tokens and assign to a new agency the role of regulating digital assets. Second, Congress should clarify poorly worded legislation tied to a recent bipartisan infrastructure bill that would drive many high-value crypto businesses, like bitcoin-mining operations, overseas. Third, the Treasury Department should consider replacing a fraction of its gold holdings — say, 10% — with bitcoin. This move would pose little risk to the department's overall balance sheet, send a positive signal to the innovative blockchain sector, and enable the United States to benefit from bitcoin's growth. If the value of bitcoin continues to appreciate strongly against gold and the U.S. dollar, such a move would help shore up the Treasury and decrease the need for monetary inflation. Finally, when it comes to digital versions of the U.S. dollar, policymakers should follow the advice of Friedrich Hayek, not Xi Jinping. In an effort to increase government control over its monetary system, China is preparing to unveil a blockchain-based digital yuan at the 2022 Beijing Winter Olympics. Jerome Powell and other Western central bankers have expressed envy for China's initiative and fret about being left behind. But Americans should strongly oppose the development of a central-bank digital currency (CBDC). Such a currency could wipe out local banks by making traditional savings and checking accounts obsolete. What's more, a CBDC-empowered Fed would accumulate a mountain of precise information about every consumer's financial transactions. Not only would this represent a grave threat to Americans' privacy and economic freedom, it would create a massive target for hackers and equip the government with the kind of censorship powers that would make Operation Choke Point look like child's play. Congress should ensure that the Federal Reserve never has the authority to issue a virtual currency. Instead, it should instruct regulators to integrate private-sector, dollar-pegged "stablecoins" — like Tether and USD Coin — into the framework we use for money-market funds and other cash-like instruments that are ubiquitous in the financial sector. PLANNING FOR THE WORST In the best-case scenario, the rise of bitcoin will motivate the United States to mend its fiscal ways. Much as Congress lowered corporate-tax rates in 2017 to reduce the incentive for U.S. companies to relocate abroad, bitcoin-driven monetary competition could push American policymakers to tackle the unsustainable growth of federal spending. While we can hope for such a scenario, we must plan for a world in which Congress continues to neglect its essential duty as a steward of Americans' wealth. The good news is that the American people are no longer destined to go down with the Fed's sinking ship. In 1971, when Washington debased the value of the dollar, Americans had no real recourse. Today, through bitcoin, they do. Bitcoin enables ordinary Americans to protect their savings from the federal government's mismanagement. It can improve the financial security of those most vulnerable to rising prices, such as hourly wage earners and retirees on fixed incomes. And it can increase the prosperity of younger Americans who will most acutely face the consequences of the country's runaway debt. Bitcoin represents an enormous strategic opportunity for Americans and the United States as a whole. With the right legal infrastructure, the currency and its underlying technology can become the next great driver of American growth. While the 21st-century monetary order will look very different from that of the 20th, bitcoin can help America maintain its economic leadership for decades to come. Tyler Durden Tue, 10/19/2021 - 23:25.....»»

Category: worldSource: nytOct 20th, 2021

How Facebook Forced a Reckoning by Shutting Down the Team That Put People Ahead of Profits

Facebook's civic-integrity team, where whistle-blower Frances Haugen worked, pledged to put people ahead of profits. Facebook shut it down, but some former members are still honoring their promise. Facebook’s civic-integrity team was always different from all the other teams that the social media company employed to combat misinformation and hate speech. For starters, every team member subscribed to an informal oath, vowing to “serve the people’s interest first, not Facebook’s.” The “civic oath,” according to five former employees, charged team members to understand Facebook’s impact on the world, keep people safe and defuse angry polarization. Samidh Chakrabarti, the team’s leader, regularly referred to this oath—which has not been previously reported—as a set of guiding principles behind the team’s work, according to the sources. [time-brightcove not-tgx=”true”] Chakrabarti’s team was effective in fixing some of the problems endemic to the platform, former employees and Facebook itself have said. But, just a month after the 2020 U.S. election, Facebook dissolved the civic-integrity team, and Chakrabarti took a leave of absence. Facebook said employees were assigned to other teams to help share the group’s experience across the company. But for many of the Facebook employees who had worked on the team, including a veteran product manager from Iowa named Frances Haugen, the message was clear: Facebook no longer wanted to concentrate power in a team whose priority was to put people ahead of profits. Illustration by TIME (Source photo: Getty Images) Five weeks later, supporters of Donald Trump stormed the U.S. Capitol—after some of them organized on Facebook and used the platform to spread the lie that the election had been stolen. The civic-integrity team’s dissolution made it harder for the platform to respond effectively to Jan. 6, one former team member, who left Facebook this year, told TIME. “A lot of people left the company. The teams that did remain had significantly less power to implement change, and that loss of focus was a pretty big deal,” said the person. “Facebook did take its eye off the ball in dissolving the team, in terms of being able to actually respond to what happened on Jan. 6.” The former employee, along with several others TIME interviewed, spoke on the condition of anonymity, for fear that being named would ruin their career. Paul Morris—Bloomberg/Getty ImagesSamidh Chakrabarti, head of Facebook’s civic-integrity team, stands beside Katie Harbath, a Facebook director of public policy, in Facebook’s headquarters in Menlo Park, California, on Oct. 17, 2018.   Enter Frances Haugen Haugen revealed her identity on Oct. 3 as the whistle-blower behind the most significant leak of internal research in the company’s 17-year history. In a bombshell testimony to the Senate Subcommittee on Consumer Protection, Product Safety, and Data Security two days later, Haugen said the civic-integrity team’s dissolution was the final event in a long series that convinced her of the need to blow the whistle. “I think the moment which I realized we needed to get help from the outside—that the only way these problems would be solved is by solving them together, not solving them alone—was when civic-integrity was dissolved following the 2020 election,” she said. “It really felt like a betrayal of the promises Facebook had made to people who had sacrificed a great deal to keep the election safe, by basically dissolving our community.” Read more: The Facebook Whistleblower Revealed Herself on 60 Minutes. Here’s What You Need to Know In a statement provided to TIME, Facebook’s vice president for integrity Guy Rosen denied the civic-integrity team had been disbanded. “We did not disband Civic Integrity,” Rosen said. “We integrated it into a larger Central Integrity team so that the incredible work pioneered for elections could be applied even further, for example, across health-related issues. Their work continues to this day.” (Facebook did not make Rosen available for an interview for this story.) Impacts of Civic Technology Conference 2016The defining values of the civic-integrity team, as described in a 2016 presentation given by Samidh Chakrabarti and Winter Mason. Civic-integrity team members were expected to adhere to this list of values, which was referred to internally as the “civic oath”. Haugen left the company in May. Before she departed, she trawled Facebook’s internal employee forum for documents posted by integrity researchers about their work. Much of the research was not related to her job, but was accessible to all Facebook employees. What she found surprised her. Some of the documents detailed an internal study that found that Instagram, its photo-sharing app, made 32% of teen girls feel worse about their bodies. Others showed how a change to Facebook’s algorithm in 2018, touted as a way to increase “meaningful social interactions” on the platform, actually incentivized divisive posts and misinformation. They also revealed that Facebook spends almost all of its budget for keeping the platform safe only on English-language content. In September, the Wall Street Journal published a damning series of articles based on some of the documents that Haugen had leaked to the paper. Haugen also gave copies of the documents to Congress and the Securities and Exchange Commission (SEC). The documents, Haugen testified Oct. 5, “prove that Facebook has repeatedly misled the public about what its own research reveals about the safety of children, the efficacy of its artificial intelligence systems, and its role in spreading divisive and extreme messages.” She told Senators that the failings revealed by the documents were all linked by one deep, underlying truth about how the company operates. “This is not simply a matter of certain social media users being angry or unstable, or about one side being radicalized against the other; it is about Facebook choosing to grow at all costs, becoming an almost trillion-dollar company by buying its profits with our safety,” she said. Facebook’s focus on increasing user engagement, which ultimately drives ad revenue and staves off competition, she argued, may keep users coming back to the site day after day—but also systematically boosts content that is polarizing, misinformative and angry, and which can send users down dark rabbit holes of political extremism or, in the case of teen girls, body dysmorphia and eating disorders. “The company’s leadership knows how to make Facebook and Instagram safer, but won’t make the necessary changes because they have put their astronomical profits before people,” Haugen said. (In 2020, the company reported $29 billion in net income—up 58% from a year earlier. This year, it briefly surpassed $1 trillion in total market value, though Haugen’s leaks have since knocked the company down to around $940 billion.) Asked if executives adhered to the same set of values as the civic-integrity team, including putting the public’s interests before Facebook’s, a company spokesperson told TIME it was “safe to say everyone at Facebook is committed to understanding our impact, keeping people safe and reducing polarization.” In the same week that an unrelated systems outage took Facebook’s services offline for hours and revealed just how much the world relies on the company’s suite of products—including WhatsApp and Instagram—the revelations sparked a new round of national soul-searching. It led some to question how one company can have such a profound impact on both democracy and the mental health of hundreds of millions of people. Haugen’s documents are the basis for at least eight new SEC investigations into the company for potentially misleading its investors. And they have prompted senior lawmakers from both parties to call for stringent new regulations. Read more: Here’s How to Fix Facebook, According to Former Employees and Leading Critics Haugen urged Congress to pass laws that would make Facebook and other social media platforms legally liable for decisions about how they choose to rank content in users’ feeds, and force companies to make their internal data available to independent researchers. She also urged lawmakers to find ways to loosen CEO Mark Zuckerberg’s iron grip on Facebook; he controls more than half of voting shares on its board, meaning he can veto any proposals for change from within. “I came forward at great personal risk because I believe we still have time to act,” Haugen told lawmakers. “But we must act now.” Potentially even more worryingly for Facebook, other experts it hired to keep the platform safe, now alienated by the company’s actions, are growing increasingly critical of their former employer. They experienced first hand Facebook’s unwillingness to change, and they know where the bodies are buried. Now, on the outside, some of them are still honoring their pledge to put the public’s interests ahead of Facebook’s. Inside Facebook’s civic-integrity team Chakrabarti, the head of the civic-integrity team, was hired by Facebook in 2015 from Google, where he had worked on improving how the search engine communicated information about lawmakers and elections to its users. A polymath described by one person who worked under him as a “Renaissance man,” Chakrabarti holds master’s degrees from MIT, Oxford and Cambridge, in artificial intelligence engineering, modern history and public policy, respectively, according to his LinkedIn profile. Although he was not in charge of Facebook’s company-wide “integrity” efforts (led by Rosen), Chakrabarti, who did not respond to requests to comment for this article, was widely seen by employees as the spiritual leader of the push to make sure the platform had a positive influence on democracy and user safety, according to multiple former employees. “He was a very inspirational figure to us, and he really embodied those values [enshrined in the civic oath] and took them quite seriously,” a former member of the team told TIME. “The team prioritized societal good over Facebook good. It was a team that really cared about the ways to address societal problems first and foremost. It was not a team that was dedicated to contributing to Facebook’s bottom line.” Chakrabarti began work on the team by questioning how Facebook could encourage people to be more engaged with their elected representatives on the platform, several of his former team members said. An early move was to suggest tweaks to Facebook’s “more pages you may like” feature that the team hoped might make users feel more like they could have an impact on politics. After the chaos of the 2016 election, which prompted Zuckerberg himself to admit that Facebook didn’t do enough to stop misinformation, the team evolved. It moved into Facebook’s wider “integrity” product group, which employs thousands of researchers and engineers to focus on fixing Facebook’s problems of misinformation, hate speech, foreign interference and harassment. It changed its name from “civic engagement” to “civic integrity,” and began tackling the platform’s most difficult problems head-on. Shortly before the midterm elections in 2018, Chakrabarti gave a talk at a conference in which he said he had “never been told to sacrifice people’s safety in order to chase a profit.” His team was hard at work making sure the midterm elections did not suffer the same failures as in 2016, in an effort that was generally seen as a success, both inside the company and externally. “To see the way that the company has mobilized to make this happen has made me feel very good about what we’re doing here,” Chakrabarti told reporters at the time. But behind closed doors, integrity employees on Chakrabarti’s team and others were increasingly getting into disagreements with Facebook leadership, former employees said. It was the beginning of the process that would eventually motivate Haugen to blow the whistle. Drew Angerer—Getty ImagesFormer Facebook employee Frances Haugen testifies during a Senate hearing entitled ‘Protecting Kids Online: Testimony from a Facebook Whistleblower’ in Washington, D.C., Oct. 5, 2021. In 2019, the year Haugen joined the company, researchers on the civic-integrity team proposed ending the use of an approved list of thousands of political accounts that were exempt from Facebook’s fact-checking program, according to tech news site The Information. Their research had found that the exemptions worsened the site’s misinformation problem because users were more likely to believe false information if it were shared by a politician. But Facebook executives rejected the proposal. The pattern repeated time and time again, as proposals to tweak the platform to down-rank misinformation or abuse were rejected or watered down by executives concerned with engagement or worried that changes might disproportionately impact one political party more than another, according to multiple reports in the press and several former employees. One cynical joke among members of the civic-integrity team was that they spent 10% of their time coding and the other 90% arguing that the code they wrote should be allowed to run, one former employee told TIME. “You write code that does exactly what it’s supposed to do, and then you had to argue with execs who didn’t want to think about integrity, had no training in it and were mad that you were hurting their product, so they shut you down,” the person said. Sometimes the civic-integrity team would also come into conflict with Facebook’s policy teams, which share the dual role of setting the rules of the platform while also lobbying politicians on Facebook’s behalf. “I found many times that there were tensions [in meetings] because the civic-integrity team was like, ‘We’re operating off this oath; this is our mission and our goal,’” says Katie Harbath, a long-serving public-policy director at the company’s Washington, D.C., office who quit in March 2021. “And then you get into decisionmaking meetings, and all of a sudden things are going another way, because the rest of the company and leadership are not basing their decisions off those principles.” Harbath admitted not always seeing eye to eye with Chakrabarti on matters of company policy, but praised his character. “Samidh is a man of integrity, to use the word,” she told TIME. “I personally saw times when he was like, ‘How can I run an integrity team if I’m not upholding integrity as a person?’” Do you work at Facebook or another social media platform? TIME would love to hear from you. You can reach out to billy.perrigo@time.com Years before the 2020 election, research by integrity teams had shown Facebook’s group recommendations feature was radicalizing users by driving them toward polarizing political groups, according to the Journal. The company declined integrity teams’ requests to turn off the feature, BuzzFeed News reported. Then, just weeks before the vote, Facebook executives changed their minds and agreed to freeze political group recommendations. The company also tweaked its News Feed to make it less likely that users would see content that algorithms flagged as potential misinformation, part of temporary emergency “break glass” measures designed by integrity teams in the run-up to the vote. “Facebook changed those safety defaults in the run-up to the election because they knew they were dangerous,” Haugen testified to Senators on Tuesday. But they didn’t keep those safety measures in place long, she added. “Because they wanted that growth back, they wanted the acceleration on the platform back after the election, they returned to their original defaults. And the fact that they had to break the glass on Jan. 6, and turn them back on, I think that’s deeply problematic.” In a statement, Facebook spokesperson Tom Reynolds rejected the idea that the company’s actions contributed to the events of Jan. 6. “In phasing in and then adjusting additional measures before, during and after the election, we took into account specific on-platforms signals and information from our ongoing, regular engagement with law enforcement,” he said. “When those signals changed, so did the measures. It is wrong to claim that these steps were the reason for Jan. 6—the measures we did need remained in place through February, and some like not recommending new, civic or political groups remain in place to this day. These were all part of a much longer and larger strategy to protect the election on our platform—and we are proud of that work.” Read more: 4 Big Takeaways From the Facebook Whistleblower Congressional Hearing Soon after the civic-integrity team was dissolved in December 2020, Chakrabarti took a leave of absence from Facebook. In August, he announced he was leaving for good. Other employees who had spent years working on platform-safety issues had begun leaving, too. In her testimony, Haugen said that several of her colleagues from civic integrity left Facebook in the same six-week period as her, after losing faith in the company’s pledge to spread their influence around the company. “Six months after the reorganization, we had clearly lost faith that those changes were coming,” she said. After Haugen’s Senate testimony, Facebook’s director of policy communications Lena Pietsch suggested that Haugen’s criticisms were invalid because she “worked at the company for less than two years, had no direct reports, never attended a decision-point meeting with C-level executives—and testified more than six times to not working on the subject matter in question.” On Twitter, Chakrabarti said he was not supportive of company leaks but spoke out in support of the points Haugen raised at the hearing. “I was there for over 6 years, had numerous direct reports, and led many decision meetings with C-level execs, and I find the perspectives shared on the need for algorithmic regulation, research transparency, and independent oversight to be entirely valid for debate,” he wrote. “The public deserves better.” Can Facebook’s latest moves protect the company? Two months after disbanding the civic-integrity team, Facebook announced a sharp directional shift: it would begin testing ways to reduce the amount of political content in users’ News Feeds altogether. In August, the company said early testing of such a change among a small percentage of U.S. users was successful, and that it would expand the tests to several other countries. Facebook declined to provide TIME with further information about how its proposed down-ranking system for political content would work. Many former employees who worked on integrity issues at the company are skeptical of the idea. “You’re saying that you’re going to define for people what political content is, and what it isn’t,” James Barnes, a former product manager on the civic-integrity team, said in an interview. “I cannot even begin to imagine all of the downstream consequences that nobody understands from doing that.” Another former civic-integrity team member said that the amount of work required to design algorithms that could detect any political content in all the languages and countries in the world—and keeping those algorithms updated to accurately map the shifting tides of political debate—would be a task that even Facebook does not have the resources to achieve fairly and equitably. Attempting to do so would almost certainly result in some content deemed political being demoted while other posts thrived, the former employee cautioned. It could also incentivize certain groups to try to game those algorithms by talking about politics in nonpolitical language, creating an arms race for engagement that would privilege the actors with enough resources to work out how to win, the same person added. Graeme Jennings—Bloomberg/Getty ImagesMark Zuckerberg, chief executive officer and founder of Facebook, speaks via video conference during a House Judiciary Subcommittee hearing in Washington, D.C., on, July 29, 2020. When Zuckerberg was hauled to testify in front of lawmakers after the Cambridge Analytica data scandal in 2018, Senators were roundly mocked on social media for asking basic questions such as how Facebook makes money if its services are free to users. (“Senator, we run ads” was Zuckerberg’s reply.) In 2021, that dynamic has changed. “The questions asked are a lot more informed,” says Sophie Zhang, a former Facebook employee who was fired in 2020 after she criticized Facebook for turning a blind eye to platform manipulation by political actors around the world. “The sentiment is increasingly bipartisan” in Congress, Zhang adds. In the past, Facebook hearings have been used by lawmakers to grandstand on polarizing subjects like whether social media platforms are censoring conservatives, but this week they were united in their condemnation of the company. “Facebook has to stop covering up what it knows, and must change its practices, but there has to be government accountability because Facebook can no longer be trusted,” Senator Richard Blumenthal of Connecticut, chair of the Subcommittee on Consumer Protection, told TIME ahead of the hearing. His Republican counterpart Marsha Blackburn agreed, saying during the hearing that regulation was coming “sooner rather than later” and that lawmakers were “close to bipartisan agreement.” As Facebook reels from the revelations of the past few days, it already appears to be reassessing product decisions. It has begun conducting reputational reviews of new products to assess whether the company could be criticized or its features could negatively affect children, the Journal reported Wednesday. It last week paused its Instagram Kids product amid the furor. Whatever the future direction of Facebook, it is clear that discontent has been brewing internally. Haugen’s document leak and testimony have already sparked calls for stricter regulation and improved the quality of public debate about social media’s influence. In a post addressing Facebook staff on Wednesday, Zuckerberg put the onus on lawmakers to update Internet regulations, particularly relating to “elections, harmful content, privacy and competition.” But the real drivers of change may be current and former employees, who have a better understanding of the inner workings of the company than anyone—and the most potential to damage the business. —With reporting by Eloise Barry/London and Chad de Guzman/Hong Kong.....»»

Category: topSource: timeOct 7th, 2021

10 Things in Politics: Rise of media-savvy congressman backing Biden

And Japan has a new prime minister. Welcome back to 10 Things in Politics. Sign up here to receive this newsletter. Plus, download Insider's app for news on the go - click here for iOS and here for Android. Send tips to bgriffiths@insider.com.Here's what we're talking about:How a freshman congressman is winning friends and influencing enemies in Biden's WashingtonJapan has a new prime minister8 things that stand out from the Pete Buttigieg documentaryWith Phil Rosen. Rep. Jake Auchincloss has become one of the Biden administration's staunchest allies in Congress. Samuel Corum/Getty Images ​​1. INSIDER PROFILE: Rep. Jake Auchincloss' ascent is a story about a media-savvy millennial politician with media-savvy handlers. The Massachusetts Democrat, a Marine veteran, racked up more than 30 TV appearances in August going to the mat for President Joe Biden's Afghanistan withdrawal.Here's a deeper look at his strategy and how the White House has responded:Auchincloss and his staffers knew there were rare moments to break through: His communications staffers have learned from Secretary of Transportation Pete Buttigieg's go-everywhere strategy. (Matt Corridoni, Auchincloss' communications director, is a former Buttigieg political aide.)The freshman congressman says his background is key: "I'm a veteran of the war in Afghanistan," Auchincloss told Insider. "I am a millennial. I felt like I could speak to this issue not just as somebody who had fought in the war but also as somebody who had a special responsibility to learn its lessons and to internalize them for the next generation of policymakers."Defending the president has its perks: Auchincloss was looped into policy issues and spoke with the White House's legislative affairs and national security teams, key access for someone just starting out his career in Washington. Also, Doug Emhoff was recently dispatched to Auchincloss' district.While he defended the administration's policy, Auchincloss has questions too: "I think the special focus should be paid to the decision to hand over Bagram air base to Afghans - and the consequences that that might have for counterterrorism," he said. Republicans have hammered the White House and the Pentagon over the decision to turn over what was once the core of the US presence in Afghanistan.Read more about how this freshman congressman is winning friends and influencing enemies in Biden's Washington.2. Democrats continue to tussle over Biden's agenda: Rep. Pramila Jayapal of Washington made clear Sunday that progressive lawmakers found Sen. Joe Manchin's offer of $1.5 trillion for a social-spending and climate bill unacceptable, The New York Times noted. Sen. Kyrsten Sinema too blasted her party's leadership over the weekend, saying the decision to delay a vote on the separate bipartisan infrastructure plan (a move Biden supports) "betrays the trust" of Americans. House Speaker Nancy Pelosi wants to move forward on both bills this month. Lawmakers are forced with difficult choices on how they might shrink the $3.5 trillion social-spending plan.3. Documents show how billionaires hide their wealth: Dozens of current and former world leaders, billionaires, rock stars, and government officials have stashed large amounts of money in secret offshore accounts, according to a massive journalism investigation known as the Pandora Papers that is even larger the Panama Papers exposé. Among the world leaders, King Abdullah II of Jordan spent $100 million on luxury homes in Malibu, California. The leaked documents also link Russian President Vladimir Putin to secret assets in Monaco connected to a woman believed to be in a relationship with Putin. More on some of the biggest findings thus far.4. Supreme Court term kicks off: Justices today begin what by the end of next summer could be a term full of consequential and controversial decisions as they tackle abortion, guns, and the religious right, The Washington Post reports. There's also the possibility that Justice Stephen Breyer could retire in the face of intense pressure ahead of the midterms. And if that weren't enough, Biden's presidential commission on the Supreme Court is set to file its report next month. Here's what to expect from the nation's highest court from now until next summer. Surfers looking at oil on the beach in Huntington Beach, California. Patrick T. Fallon/AFP via Getty Images 5. Oil spill hits Orange County beaches: Crews are trying to limit the damage from what one official warns could become "a major environmental disaster"; 125,000 gallons of crude oil have already leaked from a California pipeline. Officials said the leak appeared to have stopped, per the Los Angeles Times. It's still unclear what caused the spill.6. Japan has a new prime minister: Former Foreign Minister Fumio Kishida was elected in a parliamentary vote. "With his party and its coalition partner holding a majority in both houses, Kishida won by a comfortable margin," the Associated Press reports. Kishida is expected to move quickly to expand his party's power.7. Whistleblower says Facebook believes it's harming people: The former Facebook product manager Frances Haugen revealed on "60 Minutes" that she's the source who gave The Wall Street Journal thousands of pages of internal documents illustrating the company's knowledge that its platforms could lead to harm for both its users and society at large. Haugen said Facebook addressed only 5% of hate on its platform. Among her other bombshell claims was that an internal study found Instagram contributed to eating disorders and suicidal thoughts in teenage girls. Facebook denies the research found Instagram was toxic for teenage girls.Key quote: "I have a lot of empathy for Mark, and Mark has never set out to make a hateful platform," Haugen told CBS' Scott Pelley of CEO Mark Zuckerberg. "But he has allowed choices to be made where the side effects of those choices are that hateful, polarizing content gets more distribution and more reach."8. Fauci says it's "too soon to tell" whether holiday gatherings will be OK: Dr. Anthony Fauci said on "Face the Nation" that the acceleration of COVID-19 cases in the US was slowing but it's unclear whether it'd be safe for loved ones to gather during the holiday season. In the months leading up to the holidays, Fauci warned the US against becoming "complacent" given the history of surges throughout the pandemic. More on his comments.9. Eight things that stand out from the Pete Buttigieg documentary: In one of the final scenes of the new Amazon original film "Mayor Pete," which is scheduled to premiere at the Chicago International Film Festival on October 14, Buttigieg makes clear he hasn't given up on his dream of becoming president. Amazon is set to release it worldwide on November 12. Insider's Adam Wren, who has covered Buttigieg for years, says the documentary surprised even him. Here's what stood out, including behind-the-scenes shots as Buttigieg wrestled with ending his campaign and the blunt way aides would challenge him to get better. James Austin Johnson debuted his Joe Biden impersonation on the season-47 premiere of "SNL." NBC/Getty Images; Chip Somodevilla/Getty Images 10. Here's the deal: "SNL" has a new Biden: The new cast member James Austin Johnson made his "Saturday Night Live" debut as Biden in the season-47 cold open. The sketch parodied Biden's effort to unite Democrats on his infrastructure bill and social agenda. Watch the full sketch.Today's trivia question: Speaking of the Supreme Court, who was the first justice to serve on the high court with someone for whom they'd previously clerked? Email your answer and a suggested question to me at bgriffiths@insider.com.Friday's answer: The first lady Mamie Eisenhower decorated the White House for Halloween for the first time.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderOct 4th, 2021

US "Deeply Concerned" Over Reports Taliban "Disappearing" Ex-Afghan Officials

US "Deeply Concerned" Over Reports Taliban "Disappearing" Ex-Afghan Officials Authored by Isabel van Brugen via The Epoch Times, The chief U.S. envoy to the Taliban on Wednesday expressed concern over emerging reports that the Taliban terrorist group has summarily killed or forcibly “disappeared” more than 100 former police and intelligence officers since seizing control of Kabul in August. Thomas West, who formerly served as the deputy special representative, said on Twitter that the Taliban “are aware that the U.S. is deeply concerned about reports of retaliatory killings & forced disappearances of former ANSF [Afghan National Security Forces] members.” “We have urged the Taliban to ensure their promise of amnesty is upheld throughout their ranks and hold those responsible to account,” West said. His remarks come after Human Rights Watch released its report, titled “‘No Forgiveness for People Like You,’ Executions and Enforced Disappearances in Afghanistan under the Taliban,” on Tuesday, pointing to continuing retaliation against the armed forces of the ousted government despite an announced amnesty. The 25-page report, which focuses on Ghazni, Helmand, Kandahar, and Kunduz provinces, states that former officers have been hunted by Taliban forces using government employment records. In some cases, the terrorist group compiled lists of targets, saying they committed “unforgivable” acts. “The Taliban have also carried out abusive search operations, including night raids, to apprehend and, at times, forcibly disappear suspected former officials,” Human Rights Watch said. “The Taliban leadership’s promised amnesty has not stopped local commanders from summarily executing or disappearing former Afghan security force members,” Patricia Gossman, associate Asia director at Human Rights Watch, said in a statement. “The burden is on the Taliban to prevent further killings, hold those responsible to account, and compensate the victims’ families.” The report comes as the Taliban continues its push to be recognized internationally. A United Nations committee on Wednesday deferred on a decision on who will represent Afghanistan at the world body. On Oct. 30, Taliban spokesman Zabihullah Mujahid told reporters at a press briefing that failure to recognize its government could have global consequences. Tuesday’s report comes after a leaked report from the nonprofit RHIPTO Norwegian Center for Global Analyses, which provides intelligence to the United Nations, which found that the Taliban terrorist group was carrying out highly organized door-to-door manhunts for people on their wanted list, threatening to kill or harm their relatives if they do not surrender. Targets include people who have worked for or collaborated with American or other NATO forces, and former government employees, particularly those in intelligence services and special forces units, according to the report, which warns of mass executions of those on the Taliban’s blacklist. The Epoch Times has reached out to the State Department for additional comment. Tyler Durden Thu, 12/02/2021 - 17:20.....»»

Category: smallbizSource: nytDec 2nd, 2021

Albert Edwards: Here"s Why The FAANGs Will End Up Sinking Like The BRICs

Albert Edwards: Here's Why The FAANGs Will End Up Sinking Like The BRICs While US equity indexes have been relatively stable despite the recent spike in volatility, what is going below the surface is sheer turmoil. Take the Nasdaq: while the index remains just shy of all time highs, this is entirely thanks to the five or so gigacaps, the GAMMA (fka FAAMG) stocks, which has found solid support in recent days. Alas, the same can not be said for the rest of the tech-heavy Nasdaq where as the chart below shows, we have just seek the biggest spike in new 52-week lows since the March 2020 crash. This, when coupled with the recent bloodbath observed in the median stock (as measured by the Value Line Geometric), is why yesterday we rhetorically noted that "they better not start selling the generals" or else everything will come crashing down. They better not start selling the generals pic.twitter.com/3RHZsrn4QI — zerohedge (@zerohedge) December 1, 2021 So cue SocGen's in house grizzly bear, Albert Edwards, who - never lacking for a scenario which ends in fire and brimstone - writes this morning that hope is not a strategy and that unfortunately for the bulls, "FAANGs will end up sinking like a BRIC." Reminding his readers that Inflation and Covid remain the main focus of the markets (they hardly need reminding in light of the explosion in vol in the past week), Edwards said that he feels compelled "to flag up two important BRIC-related anniversaries that might be relevant for the dominant FAANG stocks." First, the SocGen strategist notes that it is the 20th anniversary of the invention of the BRIC acronym. (BRICs, for those who need reminding, was dreamed up by Goldman's former Chief Economist, Jim (now Lord) O’Neil, who predicted that the emerging economies of Brazil, Russia, India and China would enjoy superior economic growth and investment returns relative to the developed economies. A few days ago Jim O’Neil marked this anniversary with an update in the FT). Second, it is also exactly the 10th anniversary of Edwards' note that ridiculed ‘BRICs’ as an investment idea entitled “BRIC = Bloody Ridiculous Investment Concept." Back then, Edwards wrote that in an Ice Age world of low nominal growth, “investors are desperate to believe the EM and BRIC growth story, for they have so little alternative. The story of superior growth for the EM universe is as entirely plausible as it is entirely misleading. Valuation is what matters for investing in EM, not their superior growth story and certainly, EM equities are not relatively cheap. Yet investors persist in the BRIC superior growth fantasy. But it is no different from many of the other investment fantasies I have witnessed over the last 25 years only to see them end in severe disappointment.” BRICs have indeed been terrible investments over the past decade, underperforming both MSCI World and even the EAFE index by a very wide margin. Why does this matter? Because as Edwards urges readers today, they should put a reminder in their calendar to look out for his Global Strategy Weekly on 2 Dec 2031, by which point the SocGen permabear believes that FAAMGs will have gone the way of the BRICs: I have a similar feeling that in a decade’s time FAANGs (and US tech generally) will go the way of the BRICs as another example of acronym investing going horribly wrong. Edwards then points to the following six charts from Gerard Minack (originally written up in this article by John Authers)... ... and notes that a key story in the charts above is that "excluding the 6 ‘gigatech’ stocks, profits growth in the S&P494 stocks has been little different from the RoW. Another is that the FAAANM stocks saw their explosive re-rating only over the past five years." And while most of the FAAANM 6 stocks are no longer in the tech sector, "they certainly benefited from the explosive tech and growth stock re-rating that occurred around the time of the infamous Powell Pivot at the back end of 2018, as well as from the ‘tech-friendly’ nature of the pandemic recession." But, as Edwards warned then, "if tech is relying on EPS momentum, the rug may be beginning to be pulled out from under the sector." The SocGen strategist picks up on this warning again today, and notes that despite the sharply declining EPS of the broader IT sector, the FAANGs continue to trade at a "nosebleed PE valuation at 30x which looks vulnerable vs the market’s 22x - the widest gap since the Nasdaq bubble." It is hardly a surprise then why Edwards' highest conviction trade is the death of the "generals", an outcome that would have catastrophic consequences for the entire market. Albert's full note which touches on many other topics, is available to pro subscribers in the usual place. Tyler Durden Thu, 12/02/2021 - 13:07.....»»

Category: smallbizSource: nytDec 2nd, 2021

Victim Hopes For Justice In Ghislaine Maxwell Trial

Victim Hopes For Justice In Ghislaine Maxwell Trial Authored by Charlotte Cuthbertson via The Epoch Times, Jeffrey Epstein molested her and she didn’t tell a soul for 17 years. Teresa Helm was 22, and she had already patched her life back together after being sexually abused by a close family member, starting at age 8. “I really suffered in silence,” Helm told The Epoch Times’ “Insight” magazine. As a child, she had told her mother about the abuse in the hope that she’d make it stop. Instead, her mother told her not to tell anyone, and it continued for 3 1/2 years. “I just didn’t get help, even though I kept asking for it. And so after what happened with Jeffrey, I suffered in silence, just like I had always kind of done,” she said. In 2002, Helm had moved to California from Ohio and was attending a massage therapy school, positive of a bright future. It became even more exciting when a fellow student, a year ahead of her, approached her about an opportunity for a traveling massage therapist job. Helm was interested and was connected with another young woman, whom she subsequently met at Santa Monica to discuss the potential job. “We looked similar, we were at a similar age, so I connected with her,” Helm said. “I never felt like anything she was saying to me wasn’t legitimate, or I never felt fearful.” Teresa Helm at age 21. (Courtesy of Teresa Helm) Helm said the woman painted a phenomenal picture of what life would be like as “Miss Maxwell’s” personal traveling massage therapist—private jets, top chefs, access to the best education all over the world. “So I’d say that she did her job very well. Because in an hour or so of walking around the boardwalk, I was like, ‘Wow. This is really great. I’m so lucky, this is meant to be.'” Wanting to grasp the incredible opportunity, Helm told the woman she was interested, and was informed that she’d need to fly to New York City and meet Maxwell for the final interview. Two weeks later, Helm’s travel to New York City had been arranged—flights, driver, an Upper East Side apartment to stay in, a gift basket waiting. “I go meet with Miss Maxwell. I was expecting to give a massage because that’s what the interview was pertaining to. And everything with Ghislaine Maxwell was legitimate and pleasant, and she was very polite. Her home was stunning,” Helm said. “I was super impressed with her because she’s this very well-spoken woman, and she’s clearly successful because of her beautiful home, and she has photos on the wall of ex-president Bill Clinton. And I’m thinking: ‘Wow, she’s really something special, she’s worked hard. She’s accomplished a lot in her life.'” Helm spent a couple of hours in the home before Maxwell told her she was next going to meet up with Maxwell’s partner, Jeffrey. It was the first time Helm had heard of a partner, but nothing had indicated she should feel alarmed or that she was in any kind of danger. Any red flags, she realized in hindsight, had been easily normalized and explained away. Even when Maxwell told her to “give Jeffrey whatever he wants” during his massage because he “always gets what he wants,” Helm thought Maxwell clearly must mean, “Do a good job, because he’s had a lot of professional massages.” “Because of my trust with [Maxwell]—she was able to create that trusting bond within me in a matter of hours—I literally walked myself to the man of the house who was going to assault me,” Helm said. “I took myself there, because those three women did their job perfectly well and I didn’t suspect a darn thing. When I look back at the fact that three women set me up to be assaulted, it’s just disgusting. It’s a different level of betrayal.” Helm said Epstein sexually assaulted her in his office during the interview and threatened her as she ran out of the house, her world shaking and head spinning. Shocked to the core and full of shame, Helm returned to California the following day. (Photo and illustration by The Epoch Times) “The shame was overwhelming, it was paralyzing,” she recalled. “I was just so ashamed to say anything.” Her life spiraled down, and three months later she broke her lease, dropped out of school, and returned to Ohio. For the next five years, Helm fell into a destructive pattern. But just weeks before her 28th birthday, she found out she was pregnant, and life shifted again—this time toward the positive. “That’s what really saved my life and turned my life around,” she said. “It was the first time I really valued myself. It was like that sense of purpose. And knowing that I was going to protect my child the way that I was never protected. “Then after having him, I was so honored to be his mom. And then it really actually dug up, it was like, almost hatred toward my mom and Jeffrey. That first year of my son’s life was a lot of emotional processing for me. And I just wanted to kind of remove myself from the world and just be a mom. And that’s what I did.” Helm’s son has just turned 14, and she also has a daughter who is 7. She is the full-time caregiver for both. ‘The World Shifted’ Helm, who had moved to Florida, was folding laundry one Thursday evening in July 2019 when she went online and saw a headline about Epstein after he’d been arrested for sex trafficking. She clicked the link to open the article and came face-to-face with her abuser. In that instant, she realized “Jeffrey” was Epstein. Stunned, she sat down and googled Ghislaine Maxwell and Jeffrey Epstein. “It was life changing, just in that moment. It was like retraumatization, No. 1. No. 2, it was like the world shifted and changed all over again. It’s been different ever since that moment, like the world changed yet again, in that moment and it has not gone back. Nor will it,” Helm said. “Because I didn’t know there were others. I didn’t know that this was this huge thing with these people.” The following day, after a regular yoga class, Helm sat in her car and sobbed as the emotions swirled. She decided it was time to break her silence. The opportunity to speak out presented itself quickly. Epstein was found dead in his cell at the Metropolitan Correctional Center on Aug. 10, 2019, one month after his arrest. A medical examiner ruled it a suicide by hanging nine days later. The New York judge, Richard Berman, would be forced to dismiss the charges against Epstein—which included the sex trafficking of dozens of minors from as early as 1995—but not before he allowed survivors to speak. Twenty-three women spoke in the courthouse on Aug. 27 about being sexually abused by Epstein, either in person or through a lawyer. “I’m coming forward because it is time to bring light to that darkness, and it’s time to replace that darkness with light,” Helm said that day. She had only decided that morning to speak out and use her name publicly. Another survivor, “Jane Doe 9,” said she was 15 when she met Epstein, in 2004. “I flew on Jeffrey Epstein’s plane to Zorro Ranch, where I was sexually molested by him for many hours.” she said through a lawyer. “What I remember most vividly was him explaining to me how beneficial the experience was for me and how much he was helping me to grow. Yikes.” Epstein’s Zorro Ranch is in New Mexico. He also owned multimillion dollar properties in New York, Florida, and France, and his own islands in the Caribbean, Little St. James Island and Great St. James Island. Epstein has been linked with a veritable who’s who of the fashion and political worlds. Attorney Gloria Allred (R) and her client Teala Davies, who claims to have been a victim of sexual abuse by Jeffrey Epstein when she was a minor, at a press conference to announce a lawsuit against Epstein’s estate, in New York on Nov. 21, 2019. (TIMOTHY A. CLARY/AFP via Getty Images) Chauntae Davies also spoke in the courtroom. She said she was recruited by Maxwell while doing a massage apprenticeship. “Upon my first meeting her, I wouldn’t know I had been recruited until many years later, when I would read it in a headline,” Davies said. She said Maxwell and Epstein took her in, sent her to school, and gave her a job. “They flew me around the world, introduced me to a world I had only dreamt of and made me feel as though I had become a part of their family—another thing I was desperately searching for,” Davies said. “But on my third or fourth time meeting them, they brought me to Jeffrey’s island for the first time.” Davies said a knock on her door late at night indicated that Epstein was ready for another massage, so she hesitantly went to his villa. As Epstein began his assault on her, Davies said she told him, “No, please stop.” “But that just seemed to excite him more. He continued to rape me, and when he was finished, he hopped off and went to the shower.” Davies said she ran out of the villa, cried herself to sleep, and then spent two weeks in a Los Angeles hospital throwing up from a neurological disorder that manifests into violent vomiting attacks, largely triggered by stress. “Jeffrey’s abuse would continue for the next three years, and I allowed it to continue because I had been taken advantage of my entire life and had been conditioned to just accept it.” A protestor holds up a sign of Jeffrey Epstein in front of the federal courthouse in New York City on July 8, 2019. (Stephanie Keith/Getty Images) Maxwell on Trial Helm had finally broken her silence, and it was a watershed moment. She didn’t get to see Epstein face his charges, but she’s eager to be in court to see Maxwell face hers. FBI agents arrested Maxwell at her New Hampshire estate on July 2, 2020. She has been in a Brooklyn jail since. Bail has been denied several times, with Judge Alison Nathan ruling that she is a flight risk. The trial was originally set for July, but was delayed until Nov. 29 and is expected to last six weeks. Jury selection began on Nov. 16. Maxwell is charged with sex trafficking children, perjury, and the enticement of minors while she was a close associate of Epstein, according to a superseding indictment filed in the Southern District of New York on March 29. “In particular, from at least in or about 1994, up to and including at least in or about 2004, Maxwell assisted, facilitated, and contributed to Jeffrey Epstein’s abuse of minor girls by, among other things, helping Epstein to recruit, groom, and ultimately abuse victims known to Maxwell and Epstein to be under the age of 18,” the indictment alleges. “Moreover, in an effort to conceal her crimes, Maxwell repeatedly lied when questioned about her conduct, including in relation to some of the minor victims described herein, when providing testimony under oath in 2016.” Virginia Giuffre (formerly Virginia Roberts), one of Epstein’s most well-known accusers, claimed in a 2016 deposition that she was directed by Maxwell to have sex with a number of rich and powerful men, including “foreign presidents,” a “well-known” prime minister, and “other world leaders.” None of the men Giuffre named in the documents have been charged, and all have denied the claims. A court officer stands outside a Manhattan courthouse where media have gathered for the arraignment hearing of Ghislaine Maxwell in New York City on July 14, 2020. (Spencer Platt/Getty Images) Maxwell, often described as a British socialite, maintains her innocence on all charges and in a 2016 deposition claimed she had no idea Epstein abused young girls. During the deposition, Maxwell was asked: “Did Jeffrey Epstein have a scheme to recruit underage girls for sexual massages? If you know.” She replied: “I don’t know what you’re talking about,” according to the transcript. “I never saw any inappropriate underage activities with Jeffrey ever.” Maxwell acknowledged that former President Bill Clinton traveled on Epstein’s plane, but denied introducing Britain’s Prince Andrew to underage sex partners. “I’m ready for this trial to start,” Helm said. “I really aim to be there and look at her right in her face, and equally as important is for her to see me.” Helm isn’t named in the indictment and won’t be testifying, but that doesn’t matter. “I’m hopeful that there will be justice in this, that she will finally be held accountable and finally be sentenced for crimes that she has committed and for the lives that she has just willingly stepped in and ruined. This is a woman that changed the entire trajectory of my life and not for the better.” Helm said she hopes Maxwell is found guilty on all charges and receives the maximum penalties. “I don’t think for a moment that she deserves to be on the outside of a jail cell,” she said. “I and other girls, we’re on the outside of these bars, and yet we haven’t fully regained our freedom back. So I hope she gets the maximum sentence. She doesn’t deserve any less than that.” Helm said she often gets asked if she thinks Epstein’s death means Maxwell is now a scapegoat and is being punished for his crimes. “No, I do not. She knew what she was doing. She didn’t think twice about doing it. She did it countless times. She did it … very masterfully, very successfully,” she said. “You don’t help facilitate and run and orchestrate one of the largest sex trafficking rings on this globe, on this earth, without knowing what you’re doing and intentionally doing it.” An exterior view of the Metropolitan Detention Center in New York City on July 14, 2020. (Arturo Holmes/Getty Images) The indictment alleges that Maxwell befriended some of Epstein’s minor victims prior to their abuse, including by asking the victims about their lives, their schools, and their families. Other times, Maxwell and Epstein would take the victim shopping or to the movies, or pay travel or education expenses. “Having developed a rapport with a victim, Maxwell would try to normalize sexual abuse for a minor victim by, among other things, discussing sexual topics, undressing in front of the victim, being present when a minor victim was undressed, and/or being present for sex acts involving the minor victim and Epstein,” the court document states. The indictment goes on to say that in order to “maintain and increase his supply of victims,” Epstein, Maxwell, and other Epstein employees also paid certain victims to recruit additional girls to be similarly abused by Epstein. Helm said she has tried to understand what would cause a woman such as Ghislaine to intentionally set girls up to be forever traumatized. She said she has read how Ghislaine lost her father, whom she was very close to, and met Epstein not long afterwards. Helm said she lost her own father unexpectedly almost seven years ago. “I still to this very day miss him incredibly, and I am not out there hurting people,” she said. “There’s no grievance, or there’s no tragedy that justifies you turning around becoming literally a monster.” Maxwell’s lawyers didn’t respond to a request for comment by Insight. Epstein avoided criminal charges for years, raising questions about being protected by the rich and powerful. In September 2007, he entered into a nonprosecution agreement that gave him immunity against prosecution for numerous federal sex crimes in the Southern District of Florida. As part of the deal, in 2008, Epstein ultimately pled guilty to state charges of procuring a minor for prostitution and was registered as a sex offender. He spent 13 months in jail but was granted work release for 12 hours a day, six days a week. The Grooming Process Grooming and recruitment are critical steps in the sex trafficking industry. “If you don’t have a successful grooming process, you don’t have the abuse, because it just doesn’t make it that far,” Helm said. Jennifer Hill, assistant executive director of the Children’s Assessment Center in Houston, said her organization sees 5,000 children a year who’ve been sexually abused, both by family members or through trafficking. And that’s just the children who have spoken up. “I think most people never, ever tell. And that’s what’s tragic,” she said. Hill said it’s hard to discern how many children don’t report abuse, but statistics show that 1 in 4 girls and 1 in 6 boys will be sexually abused before they’re 18. Common events—the divorce of parents, a breakup, bullying, or the death of a family member—can all make a child vulnerable. Many trafficked children come from the foster care system. But sexual abuse is the most common source of vulnerability for sex-trafficked children—70 to 90 percent of these children have a history of sexual abuse, according to anti-trafficking organization Path2Freedom. Hill said the grooming and recruitment process takes different forms, but involves getting access to the intended victim and gaining their trust so that eventually they’ll be willing to listen to that person, and that person has some control over their behavior. For children, it can include buying gifts, listening to their problems, or helping them in some way. These days, a lot of grooming occurs online through messaging apps or social media and gaming platforms. Post-abuse, children can be threatened to stay silent. Hill said she hopes the Maxwell trial will spur other victims of trafficking and sexual abuse to come forward. As a former prosecutor of child sex abuse cases, she said a lot of abusers are teachers or trusted adults in the community, which can be intimidating for victims. Her organization conducts awareness trainings for law enforcement, medical professionals, mental health professionals, teachers, and the community on recognizing and reporting trafficking. Helm said so many lessons can be taken from the Maxwell case, “like the fact that it can be a woman.” “That woman groomed me precisely well, beautifully. And that grooming process is so crucial for parents to identify that this is what’s happening to their children. Or for a child to think I think this might be happening to me. Because that grooming process is such a transfer of power [and] a gatekeeper to the abuse.” During 2019, the National Human Trafficking hotline received reports of 11,500 human trafficking cases, representing more than 22,000 victims. California, Texas, and Florida are identified as the worst three states for human trafficking. In Texas alone, more than 79,000 children are being trafficked for sex, according to a study by the University of Texas at Austin. “There’s not one single zip code in this nation, not one that is exempt from trafficking,” Helm said. “It happens in the wealthiest of the wealthiest, to the most impoverished, and everything in between. It has exploded online.” A residence belonging to Jeffrey Epstein on East 71st St. on the Upper East Side of Manhattan in New York City on July 8, 2019. (Kevin Hagen/Getty Images) The Threat Online Fifty-five percent of domestic sex-trafficking survivors who entered the life in 2015 or later met their trafficker for the first time using a mobile app, website, or text, said Tammy Toney-Butler, an anti-human trafficking consultant for Path2Freedom. Predators ramped up their sexual enticement of minors and the posting of child sexual abuse material as schools closed and kids worked online from home in response to the COVID-19 pandemic, according to National Center for Missing and Exploited Children (NCMEC). The number of reports of online child sexual abuse materials reported to the NCMEC during the first six months of 2020 surged 90 percent to more than 12 million, the center reported. Reports of predators enticing minors went up 93 percent to more than 13,200. Facebook was used for most (59 percent) of the online recruitment in active sex trafficking cases in 2020, according to the Human Trafficking Institute’s annual trafficking report. That makes Facebook “by far the most frequently referenced website or app in public sources connected with these prosecutions, which was also true in 2019,” the report found. In June, the Texas Supreme Court ruled that Facebook could be held liable if sex traffickers use the platform to prey on children, arguing the social media website isn’t a “lawless no-man’s-land.” The ruling was made following three Houston-area lawsuits involving teenage trafficking victims who alleged that they met their abusers through Facebook’s messaging service. Prosecutors also said that Facebook was negligent by not doing more to block sex traffickers from using the site. The court said the victims can move forward with their lawsuits against Facebook. They claimed that the company violated the Texas Civil Practice and Remedies Code, which was approved in 2009. Toney-Butler said the income traffickers can make from one victim can be close to $400,000 a year, and survivors have reported being forced to have sex more than 20 times a day while being six to seven months pregnant. And once a woman is over 18, she’s often seen by society as “a drug-addicted prostitute” rather than a victim of sex trafficking, she said. A child, after being pulled into sex trafficking, “only lives for seven years before they succumb to the environment,” Toney-Butler said. Suicide, drug overdose, and violence are often the killers. Teresa Helm (R) with three other sex-trafficking survivors, (L–R) Cathy Hoffman, Sabrina Lopez, and Nissi Hamilton, in Houston on April 24. (Kathleen O. Ryan) The Future Now 41, Helm is hopeful. Aside from looking after her children, she’s a fierce advocate and mentor to other survivors and a consultant to organizations and politicians to ensure laws and programs are victim-centered. “Helping others is the ultimate payback. That I didn’t completely break forever. I’ve been broken and I have repaired myself stronger,” she said. She referred to the old Japanese art form called kintsukuroi, or “to repair with gold,” which is the practice of repairing broken ceramics with gold, making them stronger and more beautiful than before. “And I definitely kind of view myself as that, in the fact that I can turn around and leverage this pain into purpose and help others—that’s the ultimate thing for me, to be able to be strong enough to go out and help others, help them change their lives, help them recover their lives and recover their power.” For Help The National Human Trafficking Hotline is confidential, toll-free, and available 24/7 in more than 200 languages. Call: 1-888-373-7888 Text: “Help” or “Info” to 233733 Chat: humantraffickinghotline.org Tyler Durden Mon, 11/29/2021 - 23:00.....»»

Category: blogSource: zerohedgeNov 30th, 2021

BTFDers Unleashed: Futures, Yields, Oil Jump As Omicron Panic Eases

BTFDers Unleashed: Futures, Yields, Oil Jump As Omicron Panic Eases As expected over the weekend, and as we first noted shortly after electronic markets reopened for trading on Sunday, S&P futures have maintained their overnight gains and have rebounded 0.7% while Nasdaq contracts jumped as much as 1.3% after risk sentiment stabilized following Friday’s carnage and as investors settled in for a few weeks of uncertainty on whether the Omicron variant would derail economic recoveries and the tightening plans of some central banks. Japan led declines in the Asian equity session (which was catching down to Friday's US losses) after the government shut borders to visitors. The region’s reopening stocks such as restaurants, department stores, train operators and travel shares also suffered some losses.  Oil prices bounced $3 a barrel to recoup some of Friday's rout, while the safe haven yen, Swiss franc and 10Y Treasury took a breather after its run higher. Moderna shares jumped as much as 12% in pre-market trading after Chief Medical Officer Paul Burton said he suspects the new omicron coronavirus variant may elude current vaccines, and if so, a reformulated shot could be available early in the new year. Which he would obviously say as his company makes money from making vaccines, even if they are not very efficient. Here are some of the other notable premarket movers today: BioNTech (BNTX US) advanced 5% after it said it’s starting with the first steps of developing a new adapted vaccine, according to statement sent by text. Merck & Co. (MRK US) declined 1.6% after it was downgraded to neutral from buy at Citi, which also opens a negative catalyst watch, with “high probability” the drugmaker will abandon development of its HIV treatment. A selection of small biotechs rise again in U.S. premarket trading amid discussion of the companies in StockTwits and after these names outperformed during Friday’s market rout. Palatin Tech (PTN US) +37%, Biofrontera (BFRI US) +22%, 180 Life Sciences (ATNF US) +19%. Bonds gave back some of their gains, with Treasury futures were down 11 ticks. Like other safe havens, the market had rallied sharply as investors priced in the risk of a slower start to rate hikes from the U.S. Federal Reserve, and less tightening by some other central banks. Needless to say, Omicron is all anyone can talk about: on one hand, authorities have already orchestrated a lot of global panic: Britain called an urgent meeting of G7 health ministers on Monday to discuss developments on the virus, even though the South African doctor who discovered the strain and treated cases said symptoms of Omicron were so far mild. The new variant of concern was found as far afield as Canada and Australia as more countries such as Japan imposed travel restriction to try to seal themselves off. Summarizing the fearmongering dynamic observed, overnight South African health experts - including those who discovered the Omicron variant, said it appears to cause mild symptoms, while the Chinese lapdog organization, WHO, said the variant’s risk is “extremely high”. Investors are trying to work out if the omicron flareup will a relatively brief scare that markets rebound from, or a bigger blow to the global economic recovery. Much remains unanswered about the new strain: South African scientists suggested it’s presenting with mild symptoms so far, though it appears to be more transmissible, but the World Health Organization warned it could fuel future surges of Covid-19 with severe consequences. "There is a lot we don't know about Omicron, but markets have been forced to reassess the global growth outlook until we know more," said Rodrigo Catril, a market strategist at NAB. "Pfizer expects to know within two weeks if Omicron is resistant to its current vaccine, others suggest it may take several weeks. Until then markets are likely to remain jittery." "Despite the irresistible pull of buying-the-dip on tenuous early information on omicron, we are just one negative omicron headline away from going back to where we started,” Jeffrey Halley, a senior market analyst at Oanda, wrote in a note. “Expect plenty of headline-driven whipsaw price action this week.” The emergence of the omicron strain is also complicating monetary policy. Traders have already pushed back the expected timing of a first 25-basis-point rate hike by the Federal Reserve to July from June. Fed Bank of Atlanta President Raphael Bostic played down economic risks from a new variant, saying he’s open to a quicker paring of asset purchases to curb inflation. Fed Chair Jerome Powell and Treasury Secretary Janet Yellen speak before Congress on Tuesday and Wednesday. “We know that central banks can quickly switch to dovish if they need to,” Mahjabeen Zaman, Citigroup senior investment specialist, said on Bloomberg Television. “The liquidity playbook that we have in play right now will continue to support the market.” European stocks rallied their worst drop in more than a year on Friday, with travel and energy stocks leading the advance. The Stoxx 600 rose 0.9% while FTSE 100 futures gain more than 1%, aided by a report that Reliance may bid for BT Group which jumped as much as 9.5% following a report that India’s Reliance Industries may offer to buy U.K. phone company, though it pared the gain after Reliance denied it’s considering a bid. European Central Bank President Christine Lagarde put a brave face on the latest virus scare, saying the euro zone was better equipped to face the economic impact of a new wave of COVID-19 infections or the Omicron variant Japanese shares lead Asian indexes lower after Premier Kishida announces entry ban of all new foreign visitors. Hong Kong’s benchmark Hang Seng Index closed down 0.9% at the lowest level since October 2020, led by Galaxy Entertainment and Meituan. The index followed regional peers lower amid worries about the new Covid variant Omicron. Amid the big movers, Galaxy Entertainment was down 5.4% after police arrested Macau’s junket king, while Meituan falls 7.1% after reporting earnings. In FX, currency markets are stabilizing as the week kicks off yet investors are betting on the possibility of further volatility. The South African rand climbed against the greenback though most emerging-market peers declined along with developing-nation stocks. Turkey’s lira slumped more than 2% after a report at the weekend that President Recep Tayyip Erdogan ordered a probe into foreign currency trades. The Swiss franc, euro and yen retreat while loonie and Aussie top G-10 leaderboard after WTI crude futures rally more than 4%. The Bloomberg Dollar Spot Index hovered after Friday’s drop, and the greenback traded mixed against its Group-of-10 peers; commodity currencies led gains. The euro slipped back below $1.13 and Bunds sold off, yet outperformed Treasuries. The pound was steady against the dollar and rallied against the euro. Australian sovereign bonds pared an opening jump as Treasuries trimmed Friday’s spike amid continuing uncertainty over the fallout from the omicron variant. The Aussie rallied with oil and iron ore. The yen erased an earlier decline as a government announcement on planned border closures starting Tuesday spurred a drop in local equities. The rand strengthens as South African health experts call omicron variant “mild.” In rates, Treasuries were cheaper by 4bp-7bp across the curve in belly-led losses, reversing a portion of Friday’s sharp safe-haven rally as potential economic impact of omicron coronavirus strain continues to be assessed. The Treasury curve bear- steepened and the benchmark 10-year Treasury yield jumped as much as 7 basis points to 1.54%; that unwound some of Friday’s 16 basis-point plunge -- the steepest since March 2020.  Focal points include month-end on Tuesday, November jobs report Friday, and Fed Chair Powell is scheduled to speak Monday afternoon. Treasuries broadly steady since yields gapped higher when Asia session began, leaving 10-year around 1.54%, cheaper by almost 7bp on the day; front-end outperformance steepens 2s10s by ~3bp. Long-end may draw support from potential for month-end buying; Bloomberg Treasury index rebalancing was projected to extend duration by 0.11yr as of Nov. 22 In commodities, oil prices bounced after suffering their largest one-day drop since April 2020 on Friday. "The move all but guarantees the OPEC+ alliance will suspend its scheduled increase for January at its meeting on 2 December," wrote analyst at ANZ in a note. "Such headwinds are the reason it's been only gradually raising output in recent months, despite demand rebounding strongly." Brent rebounded 3.9% to $75.57 a barrel, while U.S. crude rose 4.5% to $71.24. Gold has so far found little in the way of safe haven demand, leaving it stuck at $1,791 an ounce . SGX iron ore rises almost 8% to recoup Friday’s losses. Bitcoin rallied after falling below $54,000 on Friday. Looking at today's calendar, we get October pending home sales, and November Dallas Fed manufacturing activity. We also get a bunch of Fed speakers including Williams, Powell making remarks at the New York Fed innovation event, Fed’s Hassan moderating a panel and Fed’s Bowman discussing central bank and indigenous economies. Market Snapshot S&P 500 futures up 0.6% to 4,625.00 MXAP down 0.9% to 191.79 MXAPJ down 0.4% to 625.06 Nikkei down 1.6% to 28,283.92 Topix down 1.8% to 1,948.48 Hang Seng Index down 0.9% to 23,852.24 Shanghai Composite little changed at 3,562.70 Sensex up 0.4% to 57,307.46 Australia S&P/ASX 200 down 0.5% to 7,239.82 Kospi down 0.9% to 2,909.32 STOXX Europe 600 up 0.7% to 467.47 German 10Y yield little changed at -0.31% Euro down 0.3% to $1.1283 Brent Futures up 3.8% to $75.49/bbl Gold spot up 0.3% to $1,797.11 U.S. Dollar Index up 0.13% to 96.22 Top Overnight News from Bloomberg The omicron variant of Covid-19, first identified in South Africa, has been detected in locations from Australia to the U.K. and Canada, showing the difficulties of curtailing new strains While health experts in South Africa, where omicron was first detected, said it appeared to cause only mild symptoms, the Geneva-based WHO assessed the variant’s risk as “extremely high” and called on member states to test widely. Understanding the new strain will take several days or weeks, the agency said All travelers arriving in the U.K. starting at 4 a.m. on Nov. 30 must take a PCR coronavirus test on or before the second day of their stay and isolate until they receive a negative result. Face coverings will again be mandatory in shops and other indoor settings and on public transport. Booster shots may also be approved for more age groups within days, according to Health Secretary Sajid Javid The economic effects of the successive waves of the Covid pandemic have been less and less damaging, Bank of France Governor Francois Villeroy de Galhau says Italian bonds advance for a third day, as investors shrug off new coronavirus developments over the weekend and stock futures advance, while bunds are little changed ahead of German inflation numbers and a raft of ECB speakers including President Christine Lagarde A European Commission sentiment index fell to 117.5 in November from 118.6 the previous month, data released Monday showed Spanish inflation accelerated to the fastest in nearly three decades in November on rising food prices, underscoring the lingering consequences of supply-chain bottlenecks across Europe. Consumer prices jumped 5.6% Energy prices in Europe surged on Monday after weather forecasts showed colder temperatures for the next two weeks that will lift demand for heating ECB Executive Board member Isabel Schnabel took to the airwaves to reassure her fellow Germans that inflation will slow again, hours before data set to show the fastest pace of price increases since the early 1990s Russia’s ambassador to Washington said more than 50 diplomats and their family members will have to leave the U.S. by mid-2022, in the latest sign of tensions between the former Cold War enemies China sent the biggest sortie of warplanes toward Taiwan in more than seven weeks after a U.S. lawmaker defied a Chinese demand that she abandon a trip to the island A more detailed look at global markets courtesy of Newsquawk Asia-Pac stocks traded cautiously and US equity futures rebounded from Friday’s hefty selling (S&P 500 -2.3%) as all focus remained on the Omicron variant after several countries announced restrictions and their first cases of the new variant, although markets took solace from reports that all cases so far from South Africa have been mild. Furthermore, NIH Director Collins was optimistic that current vaccines are likely to protect against the Omicron variant but also noted it was too early to know the answers, while Goldman Sachs doesn’t think the new variant is a sufficient reason to adjust its portfolio citing comments from South Africa’s NICD that the mutation is unlikely to be more malicious and existing vaccines will most likely remain effective at preventing hospitalizations and deaths. ASX 200 (-0.5%) is subdued after Australia registered its first cases of the Omicron variant which involved two people that arrived in Sydney from southern Africa and with the government reviewing its border reopening plans. Nikkei 225 (-1.6%) whipsawed whereby it initially slumped at the open due to the virus fears and currency-related headwinds but then recouped its losses and briefly returned flat as the mood gradually improved, before succumbing to a bout of late selling, and with mixed Retail Sales data adding to the indecision. Hang Seng (-1.0%) and Shanghai Comp. (Unch) weakened with Meituan the worst performer in Hong Kong after posting a quarterly loss and with casino names pressured by a crackdown in which police detained Suncity Group CEO and others after admitting to accusations including illegal cross border gambling. However, the losses in the mainland were cushioned after firm Industrial Profits data over the weekend and with local press noting expectations for China to adopt a more proactive macro policy next year. Finally, 10yr JGBs shrugged off the pullback seen in T-note and Bund futures, with price action kept afloat amid the cautious mood in stocks and the BoJ’s presence in the market for over JPY 900bln of JGBs mostly concentrated in 3yr-10yr maturities. Top Asian News Hong Kong Stocks Slide to 13-Month Low on Fresh Virus Woes Li Auto Loss Narrows as EV Maker Rides Out Supply-Chain Snarls Singapore Adds to Its Gold Pile for the First Time in Decades China Growth Stocks Look Like Havens as Markets Confront Omicron Bourses in Europe are experiencing a mild broad-based rebound (Euro Stoxx 50 +1.0%; Stoxx 600 +0.9%) following Friday's hefty COVID-induced losses. Desks over the weekend have been framing Friday's losses as somewhat overstretched in holiday-thinned liquidity, given how little is known about the Omicron variant itself. The strain will likely remain the market theme as scientists and policymakers factor in this new variant, whilst data from this point forth – including Friday's US labour market report - will likely be passed off as somewhat stale, and headline risk will likely be abundant. Thus far, symptoms from Omicron are seemingly milder than some of its predecessors, although governments and central banks will likely continue to express caution in this period of uncertainty. Back to price action, the momentum of the rebound has lost steam; US equity futures have also been drifting lower since the European cash open – with the RTY (+0.9%) was the laggard in early European trade vs the ES (+0.8%), NQ (+1.0%) and YM (+0.7%). European cash bourses have also been waning off best levels but remain in positive territory. Sectors are mostly in the green, but the breadth of the market has narrowed since the cash open. Travel & Leisure retains the top spot in what seems to be more a reversal of Friday's exaggerated underperformance as opposed to a fundamentally driven rebound – with more nations announcing travel restrictions to stem the spread of the variant. Oil & Gas has also trimmed some of Friday's losses as oil prices see a modest rebound relative to Friday's slump. On the other end of the spectrum, Healthcare sees mild losses as COVID-related names take a mild breather, although Moderna (+9.1% pre-market) gains ahead of the US open after its Chief Medical Officer suggested a new vaccine for the variant could be ready early next year. Meanwhile, Autos & Parts reside as the current laggard amid several bearish updates, including a Y/Y drop in German car exports - due to the chip shortage and supply bottlenecks – factors which the Daimler Truck CEO suggested will lead to billions of Euros in losses. Furthermore, auto supbt.aplier provider Faurecia (-5.9%) trades at the foot of the Stoxx 600 after slashing guidance – again a function of the chip shortage. In terms of Monday M&A, BT (+4.7%) shares opened higher by almost 10% following source reports in Indian press suggesting Reliance Industries is gearing up for a takeover approach of BT – reports that were subsequently rebuffed. Top European News U.K. Mortgage Approvals Fall to 67,199 in Oct. Vs. Est. 70,000 Johnson Matthey Rises on Report of Battery Talks With Tata Gazprom Reports Record Third-Quarter Profit Amid Gas Surge Omicron’s Spread Fuels Search for Answers as WHO Sounds Warning In FX, the Buck has bounced from Friday’s pullback lows on a mixture of short covering, consolidation and a somewhat more hopeful prognosis of SA’s new coronavirus strand compared to very early perceptions prompted by reports that the latest mutation would be even worse than the Delta variant. In DXY terms, a base above 96.000 is forming within a 93.366-144 band amidst a rebound in US Treasury yields and re-steepening along the curve following comments from Fed’s Bostic indicating a willingness to back faster QE tapering. Ahead, pending home sales and Dallas Fed business manufacturing along with more Fed rhetoric from Williams and chair Powell on the eve of month end. AUD/CAD/NZD - No surprise to see the high beta and risk sensitive currencies take advantage of the somewhat calmer conditions plus a recovery in crude and other commodities that were decimated by the prospect of depressed demand due to the aforementioned Omicron outbreak. The Aussie is back over 0.7150 vs its US counterpart, the Loonie has pared back losses from sub-1.2750 with assistance from WTI’s recovery to top Usd 72/brl vs a Usd 67.40 trough on November 26 and the Kiwi is hovering above 0.6800 even though RBNZ chief economist Ha has warned that a pause in OCR tightening could occur if the fresh COVID-19 wave proves to be a ‘game-changer’. JPY/EUR - The major laggards as sentiment stabilses, with the Yen midway between 112.99-113.88 parameters and hardly helped by mixed Japanese retail sales data, while the Euro has retreated below 1.1300 where 1.7 bn option expiry interest resides and a key Fib level just under the round number irrespective of strong German state inflation reports and encouraging pan Eurozone sentiment indicators, as more nations batten down the hatches to stem the spread of SA’s virus that has shown up in parts of the bloc. GBP/CHF - Both narrowly divergent vs the Dollar, as Cable retains 1.3300+ status against the backdrop of retreating Gilt and Short Sterling futures even though UK consumer credit, mortgage lending and approvals are rather conflicting, while the Franc pivots 0.9250 and meanders from 1.0426 to 1.0453 against the Euro after the latest weekly update on Swiss bank sight deposits showing no sign of official intervention. However, Usd/Chf may veer towards 1.1 bn option expiries at the 0.9275 strike if risk appetite continues to improve ahead of KoF on Tuesday and monthly reserves data. SCANDI/EM - Although Brent has bounced to the benefit of the Nok, Sek outperformance has ensued in wake of an upgrade to final Swedish Q3 GDP, while the Cnh and Cny are deriving support via a rise in Chinese industrial profits on a y/y basis and the Zar is breathing a sigh of relief on the aforementioned ‘better’ virus updates/assessments from SA on balance. Conversely, the Try is back under pressure post-a deterioration in Turkish economic sentiment vs smaller trade deficit as investors look forward to CPI at the end of the week. Meanwhile, Turkish President Erdogan provides no reprieve for the Lira as he once again defending his unorthodox view that higher interest rates lead to higher inflation. In commodities, WTI and Brent front-month futures consolidate following an overnight rebound – with WTI Jan back on a USD 71/bbl handle and Brent Feb just under USD 75/bbl – albeit still some way off from Friday's best levels which saw the former's high above USD 78/bbl and the latter's best north of USD 81/bbl. The week is packed with risks to the oil complex, including the resumption of Iranian nuclear talks (slated at 13:00GMT/08:00EST today) and the OPEC+ monthly confab. In terms of the former, little is expected in terms of progress unless the US agrees to adhere to Tehran's demand – which at this point seems unlikely. Tehran continues to seek the removal of US sanctions alongside assurances that the US will not withdraw from the deal. "The assertion that the US must 'change its approach if it wants progress' sets a challenging tone", Citi's analysts said, and the bank also expects parties to demand full access to Iranian nuclear facilities for verification of compliance. Further, the IAEA Chief met with Iranian officials last week; although concrete progress was sparse, the overall tone of the meeting was one of progress. "We remain of the opinion that additional Iranian supplies are unlikely to reach the market before the second half of 2022 at the earliest," Citi said. Meanwhile, reports suggested the US and allies have been debating a "Plan B" if talks were to collapse. NBC News – citing European diplomats, former US officials and experts – suggested that options included: 1) a skinny nuclear deal, 2) ramp up sanctions, 3) Launching operations to sabotage Iranian nuclear advances, 4) Military strikes, 5) persuading China to halt Iranian oil imports, albeit Iran and China recently signed a 25yr deal. Over to OPEC+, a rescheduling (in light of the Omicron variant) sees the OPEC and JTC meeting now on the 1st December, followed by the JMMC and OPEC+ on the 2nd. Sources on Friday suggested that members are leaning towards a pause in the planned monthly output, although Russian Deputy PM Novak hit the wires today and suggested there is no need for urgent measures in the oil market. Markets will likely be tested, and expectations massaged with several sources heading into the meeting later this week. Elsewhere, spot gold trades sideways just under the USD 1,800/oz and above a cluster of DMAs, including the 50 (1,790.60/oz), 200 (1,791.30/oz) and 100 (1,792.80/oz) awaiting the next catalyst. Over to base metals, LME copper recoups some of Friday's lost ground, with traders also citing the underlying demand emanating from the EV revolution. US Event Calendar 10am: Oct. Pending Home Sales YoY, prior -7.2% 10am: Oct. Pending Home Sales (MoM), est. 0.8%, prior -2.3% 10:30am: Nov. Dallas Fed Manf. Activity, est. 17.0, prior 14.6 Central Bank speakers: 3pm: Fed’s Williams gives opening remarks at NY Innovation Center 3:05pm: Powell Makes Opening Remarks at New York Fed Innovation Event 3:15pm: Fed’s Hassan moderates panel introducing NY Innovation Center 5:05pm: Fed’s Bowman Discusses Central bank and Indigenous Economies DB's Jim Reid concludes the overnight wrap Last night Henry in my team put out a Q&A looking at what we know about Omicron (link here) as many risk assets put in their worst performance of the year on Friday after it exploded into view. The main reason for the widespread concern is the incredibly high number of mutations, with 32 on the spike protein specifically, which is the part of the virus that allows it to enter human cells. That’s much more than we’ve seen for previous variants, and raises the prospect it could be a more transmissible version of the virus, although scientists are still assessing this. South Africa is clearly where it has been discovered (not necessarily originated from) and where it has been spreading most. The fact that’s it’s become the dominant strain there in just two weeks hints at its higher level of contagiousness. However the read through to elsewhere is tough as the country has only fully vaccinated 24% of its population, relative to at least 68% in most of the larger developed countries bar the US which languishes at 58%. It could still prove less deadly (as virus variants over time mostly are) but if it is more contagious that could offset this and it could still cause similar healthcare issues, especially if vaccines are less protective. On the other hand the South African doctor who first alerted authorities to the unusual symptoms that have now been found to have been caused by Omicron, was on numerous media platforms over the weekend suggesting that the patients she has seen with it were exhausted but generally had mild symptoms. However she also said her patients were from a healthy cohort so we can’t relax too much on this. However as South African cases rise we will get a lot of clues from hospitalisation data even if only 6% of the country is over 65s. My personal view is that we’ll get a lot of information quite quickly around how bad this variant is. The reports over the weekend that numerous cases of Omicron have already been discovered around the world, suggests it’s probably more widespread than people think already. So we will likely soon learn whether these patients present with more severe illness and we’ll also learn of their vaccination status before any official study is out. The only caveat would be that until elderly patients have been exposed in enough scale we won’t be able to rule out the more negative scenarios. Before all that the level of restrictions have been significantly ramped up over the weekend in many countries. Henry discusses this in his note but one very significant one is that ALL travellers coming into (or back to) the UK will have to self isolate until they get a negative PCR test. This sort of thing will dramatically reduce travel, especially short business trips. Overnight Japan have effectively banned ALL foreign visitors. I appreciate its dangerous to be positive on covid at the moment but you only have to look at the UK for signs that boosters are doing a great job. Cases in the elderly population continue to collapse as the roll out progresses well and overall deaths have dropped nearly 20% over the last week to 121 (7-day average) - a tenth of where they were at the peak even though cases have recently been 80-90% of their peak levels. If Europe are just lagging the UK on boosters rather than anything more structural, most countries should be able to control the current wave all things being equal. However Omicron could make things less equal but it would be a huge surprise if vaccines made no impact. Stocks in Asia are trading cautiously but remember that the US and Europe sold off more aggressively after Asia closed on Friday. So the lack of major damage is insightful. The Nikkei (-0.02%), Shanghai Composite (-0.14%), CSI (-0.22%), KOSPI (-0.47%) and Hang Seng (-0.68%) are only slightly lower. Treasury yields, oil, and equity futures are all rising in Asia. US treasury yields are up 4-6bps across the curve, Oil is c.+4.5% higher, while the ZAR is +1.31%. Equity futures are trading higher with the S&P 500 (+0.71%) and DAX (+0.84%) futures in the green. In terms of looking ahead, we may be heading into December this week but there’s still an incredibly eventful period ahead on the market calendar even outside of Omicron. We have payrolls on Friday which could still have a big impact on what the Fed do at their important December 15 FOMC and especially on whether they accelerate the taper. Wednesday (Manufacturing) and Friday (Services) see the latest global PMIs which will as ever be closely watched even if people will suggest that the latest virus surge and now Omicron variant may make it backward looking. Elsewhere in the Euro Area, we’ll get the flash CPI estimate for November tomorrow (France and Italy on the same day with Germany today), and we’ll hear from Fed Chair Powell as he testifies (with Mrs Yellen) before congressional committees tomorrow and Wednesday. There’s lots of other Fed speakers this week (ahead of their blackout from this coming weekend) and last week there was a definite shift towards a faster taper bias, even amongst the doves on the committee with Daly being the most important potential convert. Fed speakers this week might though have to balance the emergence of the new variant with the obvious point that without it the Fed is a fair bit behind the curve. Importantly but lurking in the background, Friday is also the US funding deadline before another government shutdown. History would suggest a tense last minute deal but it’s tough to predict. Recapping last week now and the emergence of the new variant reshaped the whole week even if ahead of this, continued case growth across Europe prompted renewed lockdown measures and travel bans across the continent. Risk sentiment clearly plummeted on Friday. The S&P 500 fell -2.27%, the biggest drop since October 2020, while the Stoxx 600 fell -3.67%, the biggest one-day decline since the original Covid-induced risk off in March 2020. The S&P 500 was -2.20% lower last week, while the Stoxx 600 was down -4.53% on the week. 10yr treasury, bund, and gilt yields declined -16.1bps, -8.7bps, and -14.5bps, undoing the inflation and policy response-driven selloff from earlier in the week. The drop in 10yr treasury and gilt yields were the biggest one-day declines since the original Covid-driven rally in March 2020, while the drop in bund yields was the largest since April 2020. 10yr treasury, bund, and gilt yields ended the week -7.3bps lower, +0.7bps higher, and -5.4bps lower, respectively. Measures of inflation compensation declined due to the anticipated hit to global demand, with 10yr breakevens in the US and Germany -6.8bps and -8.8bps lower Friday, along with Brent and WTI futures declining -11.55% and -13.06%, respectively. Investors pushed back the anticipated timing of rate hikes. As it stands, the first full Fed hike is just about priced for July, and 2 hikes are priced for 2022. This follows a hawkish tone from even the most dovish FOMC members and the November FOMC minutes last week. The prevailing sentiment was the FOMC was preparing to accelerate their asset purchase taper at the December meeting to enable inflation-fighting rate hikes earlier in 2022. Understanding the impact of the new variant will be crucial for interpreting the Fed’s reaction function, though. The impact may not be so obvious; while a new variant would certainly hurt global demand and portend more policy accommodation, it will also likely prompt more virus-avoiding behaviour in the labour market, preventing workers from returning to pre-Covid levels. Whether the Fed decides to accommodate these sidelined workers for longer, or to re-think what constitutes full employment in a Covid world should inform your view on whether they accelerate tapering in December. It feels like a lifetime ago but last week also saw President Biden nominate Chair Powell to head the Fed for another term, and for Governor Brainard to serve as Vice Chair. The announcement led to a selloff in rates as the more dovish Brainard did not land the head job. In Germany, the center-left SPD, Greens, and liberal FDP agreed to a full coalition deal. The traffic-light coalition agreed to restore the debt break in 2023, after being suspended during the pandemic, and to raise the minimum wage to €12 per hour. The SPD’s Olaf Scholz will assume the Chancellorship. The US, China, India, Japan, South Korea, and UK announced releases of strategic petroleum reserves. Oil prices were higher following the announcement, in part because releases were smaller than anticipated but, as mentioned, prices dropped precipitously on Friday on the global demand impact of the new Covid variant. The ECB released the minutes of the October Governing Council meeting, where officials stressed the need to maintain optionality in their policy setting. They acknowledged growing upside risks to inflation but stressed the importance of not overreacting in setting policy as they see how inflation scenarios might unfold. Tyler Durden Mon, 11/29/2021 - 08:01.....»»

Category: dealsSource: nytNov 29th, 2021

White House Weighs Travel Curbs For South Africa After Breakout Of "Nu" Variant

White House Weighs Travel Curbs For South Africa After Breakout Of "Nu" Variant Update (1200ET): We're still waiting on the final word from the WHO, but it appears the vaccine race is on. J&J is claiming that it has already started testing its jab's efficacy against the "Nu" variant, which was first identified in South Africa. Meanwhile, Pfizer director and former FDA chief Dr. Scott Gottlieb warned Friday morning that the "Nu" variant has major escape mutations that could help it evade natural immunity. Essentially, Dr. Gottlieb's take is a wrap of what we already know: "What it is going to do is increase the importance of getting boosters"...but ultimately, the conclusion is this is nowhere near as bad as people are making it out to be. However, now there are reports claiming the White House is weighing to follow suit with its own travel restrictions against South Africa. That sends a pretty clear message: alert us to a potentially vaccine-defying new variant and we will...immediately cut off travel links with you. But at least Pfizer shares are soaring, which tells us one thing: vaccines are now more important than ever since the "Nu" variant is showing us that natural immunity might not be enough. * * * Update (1145ET): As European stocks wrap up their worst daily drop in more than a year, is it too late for US markets to see a major daily turnaround? We hope not... Right now, it appears this is what they're going with: while a breakthrough infection has been documented, there's yet to be any proof that the variant causes "severe" breakthrough infections. S. AFRICA SAYS BREAKTHROUGH INFECTIONS SEEN WITH VARIANT S. AFRICA SAYS NO INDICATION THAT THOSE CASES ARE SEVERE In the first sign of a  major turnaround, South African scientist Sanne has reportedly told the press that there's every indication that vaccines will continue to protect against "Nu", the COVID variant of the moment. Here's more: South African Health Minister Joseph Phaahla reacts to new #COVID19 travel bans: “The reaction of countries to impose travel bans are completely against the norms and standards as guided by the World Health Organisation." #B11529 — Laura López González (@LLopezGonzalez) November 26, 2021 Preliminary studies do suggest the #B11529 variant may be more transmissible, says South African Health Minister Joseph Phaahla. He emphasises that what scientists know about the #COVID19 variant is in its infancy. There is no evidence to suggest the variant makes you sicker. — Laura López González (@LLopezGonzalez) November 26, 2021 South African Health Minister Joseph Phaahla: "All that we, did together with our scientists who made this discovery of the #B11529 variant, was to be in line with the norms and standards of the international community.” — Laura López González (@LLopezGonzalez) November 26, 2021 South African Health Minister Joseph Phaahla: "South African scientists simply said that, just as has been the case with other mutations, some of them have been more transmissible without increasing the severity of the disease. This is early stages.” #COVID19 #B11529 — Laura López González (@LLopezGonzalez) November 26, 2021 Phaahla: "The same countries that are enacting this kind of knee jerk, draconian reaction [#COVID19 travel bans] are battling their own waves." He adds that many European countries are seeing daily infection rates much higher than SA. "This is not scientific ." #B11529 — Laura López González (@LLopezGonzalez) November 26, 2021 South African Health Department Acting Director-General Nicholas Crisp says the first he heard of #COVID19 travel bans against the country was at 10pm last night when the British High Commission messaged to apologise for the travel ban. #B11529 — Laura López González (@LLopezGonzalez) November 26, 2021 Right to Care CEO Ian Sanne saying #COVID19 cases remain under 3,000 a day. "We have every indication that vaccines are still effective in preventing severe disease & complications. Data is however small and early. Identification of this variant was just last week." #B11529 — Laura López González (@LLopezGonzalez) November 26, 2021 "We do think #B11529 is more transmissible and has already spread quite widely across South Africa. Laboratory tests are underway and will have more immunology work undertaken by next week." - @righttocaresa CEO Ian Sanne #COVID19 — Laura López González (@LLopezGonzalez) November 26, 2021 Meanwhile, South Africa Health Department Acting Director-General has reportedly received a message earlier today from the WHO claiming the agency will in fact designate the new variant as one of "concern." Get ready for this short-term dip to get aggressively bought. *  * Update (1000ET): In the latest sign that the word will be at defcon four over the "Nu" variant before dinner - or perhaps even before the US market's early Friday close at 1300ET - an EU agency has just labeled "Nu" a "variant of concern". The decision has apparently prompted the WHO to call an emergency meeting Friday to consider whether or not to do the same. As we reported earlier, public health officials are sounding the alarm as a new strain of the coronavirus has been detected. According to the latest reports, Hong Kong and the Netherlands have stepped up border restrictions. Hong Kong has barred non-residents from 8 different south African countries, from entering. The new strain doesn't have an official name yet, but scientists first confirmed the apparently fast-spreading variant in South Africa. They say it is highly contagious, and shows signs that it might be able to easily overpower vaccines. The World Health Organization is calling a meeting Friday to determine if they will declare the new strain a 'variant of concern'. Even without the new strain, COVID cases have been on the rise for about a month, nearing an average of 100,000 per day, and experts worry it could be the start of a new wave. The Dutch are already using "Nu" as a reason to tighten their lockdown restrictions on businesses. Starting Sunday, restaurants and other businesses will be subject to a 0500ET to 1700ET curfew. Schools will remain open, and the measures will be in place provisionally for 3 weeks, at least. The CDC's latest forecast predicts between 4,100 and 12,000 people will be hospitalized with COVID in the US by mid-December. Wall Street sell-side analysts are going all-in on "Nu" fearmongering: One Citi analyst note says the "accumulation of variations" in Nu suggest that "our fears have been realized". Then again, "concern over Nu" needs to be balanced with the failure of other variants to outmuscle delta as the world's most prevalent variant. However, Europe has been struggling with a resurgence of cases, while the US follows a similar path. Although, in the US, Dr. Anthony Fauci is already telling cable news networks that the US has no plans to restrict travel from South Africa. At least, not yet. * * * In what is becoming a nightmare for thousands of traders (and an even larger number of public health officials, we imagine), the latest COVID variant to elicit a hysterical response - the ironically named "nu" variant" - has just been confirmed in Belgium, the first European country to confirm cases of the new strain. Two suspected cases of the new variant have been detected and confirmed in Belgium, according to local media reports. The strain was initially found in South Africa, Hong Kong, Botswana and Israel. It's early days, but according to some the variant has already elicited major surges in infections. Enough so that news about the variant and panic about a more chaotic outlook for interest rates and the broader global economy has sent S&P 500 futures tumbling, and the VIX surging, in premarket trading, on an otherwise quiet post-Thanksgiving Friday morning, a day where markets close at 1300ET. And rate-hike odds are already tumbling. Finally, these charts should help readers put this all into context... ...and... The Nu variant, formerly referred to as B.1.1529, was initially identified five days ago, first in Botswana, with subsequent confirmation and sequencing in South Africa where 100 cases have been confirmed. The variant has also spread to Israel and Hong Kong, according to Citi analyst Andrew Baum. Of course, all of this comes with a pretty big asterisk: The analyst believes concern over Nu needs to be balanced against the failure of other concerning variants such as Beta to out-compete delta. Belgium also confirmed that the "nu" cases involved a traveler who had just arrived in the country from "abroad". Already, Spain, the U, India and a handful of other nations have imposed new border restrictions, citing the new variant as the motive. Advisors in the UK have already declared the variant a serious threat (although they said the same thing about the last variant boogeyman, delta-plus). One trader has some pretty interesting thoughts about where this is all going. Tyler Durden Fri, 11/26/2021 - 12:01.....»»

Category: blogSource: zerohedgeNov 26th, 2021

With Low Vaccination Rates, Africa"s COVID Deaths Remain Far Below Europe & US

With Low Vaccination Rates, Africa's COVID Deaths Remain Far Below Europe & US Authored by Ryan McMaken via The Mises Institute, Since the very beginning of the covid panic, the narrative has been this: implement severe lockdowns or your population will experience a bloodbath. Morgues will be overwhelmed, the death total toll will be astounding. On the other hand, we were assured those jurisdictions that do lock down would see only a fraction of the death toll. Then, once vaccines became available, the narrative was modified to: "Get shots in arms and then covid will stop spreading. Those countries without vaccines, on the other hand, will continue to face mass casualties." The lockdown narrative, of course, has already been thoroughly overturned. Jurisdictions that did not lock down or adopted only weak and short lockdowns ended up with covid death tolls that were either similar to—or even better than—death tolls in countries that adopted draconian lockdowns. Lockdown advocates said locked-down countries would be overwhelmingly better off. These people were clearly wrong.  Undaunted by the increasing implausibility of the lockdown narrative, the global health bureaucrats are nonetheless doubling down on forced vaccines—as we now see in Austria—and we continue to be assured that only countries with high vaccination rates can hope to avoid disastrous covid outcomes.  Yet, the experience in sub-Saharan Africa calls both these narratives into question: Africa's numbers have been far, far lower than the experts warned would be the case.  For example, the AP reported this week that in spite of low vaccination rates, Africa has fared better than most of the world: [T]here is something “mysterious” going on in Africa that is puzzling scientists, said Wafaa El-Sadr, chair of global health at Columbia University. “Africa doesn’t have the vaccines and the resources to fight COVID-19 that they have in Europe and the U.S., but somehow they seem to be doing better,” she said…. Fewer than 6% of people in Africa are vaccinated. For months, the WHO has described Africa as “one of the least affected regions in the world” in its weekly pandemic reports. Yet disaster for Africa has long been predicted for several reasons even beyond the availability of vaccines. For instance, it is known that lockdowns are especially impractical in the poorest parts of the world. This is because populations in places with undeveloped economies can’t simply sit at home and live off savings or debt. Rather, these people must go out into the world and earn a living on a day-to-day basis. Starvation is the alternative. Moreover, much of this work is done in the informal economy, so enforcing lockdowns becomes especially difficult. Source: Our World in Data (Confirmed Deaths per Million, November 19, 2021;  Share of People Vaccinated against Covid-19, November 19, 2021). It was also assumed covid would be especially deadly in Africa due to the fact many large households live in small housing units. But that "conventional wisdom" flies in the face of the reality of covid in Africa, which is that there have been fewer deaths. The "experts" have groped around, looking for possible explanations. Some sources, for example, insist that the low death totals are only an artifact of incomplete reporting on covid infections and that "a lack of good qualitative data was the issue." But Richard Wamai at Northeastern University rejects the claim it’s all about case reporting, and says that "local systems for reporting deaths in Africa make it difficult to hide COVID-19 casualties." In a paper for the International Journal of Environmental Research and Public Health, Wamai and his coauthors conclude, "[T]here is no evidence that COVID-19 mortality data is less accurately reported in Africa than elsewhere" and "While the true picture of infections and mortality in the continent has yet to fully emerge, the quality of data for other diseases, such as HIV/AIDS, indicates that Africa has the capacity to collect and report valid disease surveillance data." In any case, the World Health Organization reports that covid deaths in Africa make up only 2.9 percent of covid deaths, while Africa’s population is 16 percent of the global total. Africa’s covid total could double or triple, and Africa would still be faring far better than Europe and the Americas. Wamai et al. also note that at this point "[i]t is likely that SARS-CoV-2 has already been widely disseminated through Africa…. If so, widespread infection is likely to also result in widespread natural immunity." In other words, continued claims by health officials—both in Africa and elsewhere—that mass death is right around the corner with the "next wave" look increasingly implausible.  It looks increasingly likely that the lack of covid mortality in Africa is not due to a data issue nor a situation in which covid has been "contained" up until now. So then why is Africa doing so much better than the wealthy West? Naturally, the advocates of forced lockdowns and coerced vaccines would prefer to ignore this issue altogether, but the undeniable reality of Africa’s experience has forced mainstream researchers to publicly admit the many ways that many factors can explain covid's prevalence beyond vaccination rates and mask mandates. For instance, mentioning that obesity is an important factor in covid mortality has in the past been likely to get one savaged in the media for "fat shaming." Yet the Africa situation has forced the well informed to admit that yes, obese populations clearly suffer more from covid. In Africa, not surprisingly, we find that obesity rates are far below those found in North America and Europe. Other possible explanations forwarded as reasons for Africa’s situation include past exposure to other coronaviruses, youthful populations, fewer patients lacking zinc and vitamin D, past use of the Bacillus Calmette-Guérin vaccination, climate, genetic background, and parasite load.  In addressing the African "enigma" one group of researchers in the journal Colombia medica dared even suggest it’s possible—although not conclusively shown at this point—that “a mass public health preventive campaign against COVID-19 may have taken place, inadvertently, in some African countries with massive community ivermectin use.” Source: "Global Obesity Levels," ProCon.org, last modified March 27, 2020; Our World in Data (Share of People Vaccinated against Covid-19, November 19, 2021). In the West, however, the media drumbeat around covid has consistently been "Shut up, stay home, get jabbed, and stop doubting the experts on forced vaccines." Fortunately, however, the African situation has forced many researchers to ask inconvenient questions. In fact, it’s amazing Africa has not been overcome by mass death considering that covid lockdowns and covid "mitigation" measures have contributed to the impoverishment and mass starvation on the continent. Or as Germany’s DW News puts it, “Measures put in place to slow the spread of the novel coronavirus are pushing millions of people in Africa into severe hunger.” And as Wamai notes, “[S]ome of the excess deaths in Africa “can be attributed not to the disease, but to lockdown measures that cut off access to medical care for other illnesses.” But Africa hasn’t gotten the bloodbath that was promised, and as one Nigerian put it, "They said there will be dead bodies on the streets and all that, but nothing like that happened." Tyler Durden Thu, 11/25/2021 - 05:10.....»»

Category: blogSource: zerohedgeNov 25th, 2021

In Memory Of JFK: The First US President To Be Labeled A Terrorist & Threat To National Security

In Memory Of JFK: The First US President To Be Labeled A Terrorist & Threat To National Security Authored by Cynthia Chung via The Saker blog, In April 1954, Kennedy stood up on the Senate floor to challenge the Eisenhower Administration’s support for the doomed French imperial war in Vietnam, foreseeing that this would not be a short-lived war. In July 1957, Kennedy once more took a strong stand against French colonialism, this time France’s bloody war against Algeria’s independence movement, which again found the Eisenhower Administration on the wrong side of history. Rising on the Senate floor, two days before America’s own Independence Day, Kennedy declared: “The most powerful single force in the world today is neither communism nor capitalism, neither the H-bomb nor the guided missile – it is man’s eternal desire to be free and independent. The great enemy of that tremendous force of freedom is called, for want of a more precise term, imperialism – and today that means Soviet imperialism and, whether we like it or not, and though they are not to be equated, Western imperialism. Thus, the single most important test of American foreign policy today is how we meet the challenge of imperialism, what we do to further man’s desire to be free. On this test more than any other, this nation shall be critically judged by the uncommitted millions in Asia and Africa, and anxiously watched by the still hopeful lovers of freedom behind the Iron Curtain. If we fail to meet the challenge of either Soviet or Western imperialism, then no amount of foreign aid, no aggrandizement of armaments, no new pacts or doctrines or high-level conferences can prevent further setbacks to our course and to our security.” In September 1960, the annual United Nations General Assembly was held in New York. Fidel Castro and a fifty-member delegation were among the attendees and had made a splash in the headlines when he decided to stay at the Hotel Theresa in Harlem after the midtown Shelburne Hotel demanded a $20,000 security deposit. He made an even bigger splash in the headlines when he made a speech at this hotel, discussing the issue of equality in the United States while in Harlem, one of the poorest boroughs in the country. Kennedy would visit this very same hotel a short while later, and also made a speech: “Behind the fact of Castro coming to this hotel, [and] Khrushchev…there is another great traveler in the world, and that is the travel of a world revolution, a world in turmoil…We should be glad [that Castro and Khrushchev] came to the United States. We should not fear the twentieth century, for the worldwide revolution which we see all around us is part of the original American Revolution." What did Kennedy mean by this? The American Revolution was fought for freedom, freedom from the rule of monarchy and imperialism in favour of national sovereignty. What Kennedy was stating, was that this was the very oppression that the rest of the world wished to shake the yoke off, and that the United States had an opportunity to be a leader in the cause for the independence of all nations. On June 30th, 1960, marking the independence of the Republic of Congo from the colonial rule of Belgium, Patrice Lumumba, the first Congolese Prime Minister gave a speech that has become famous for its outspoken criticism of colonialism. Lumumba spoke of his people’s struggle against “the humiliating bondage that was forced upon us… [years that were] filled with tears, fire and blood,” and concluded vowing “We shall show the world what the black man can do when working in liberty, and we shall make the Congo the pride of Africa.” Shortly after, Lumumba also made clear, “We want no part of the Cold War… We want Africa to remain African with a policy of neutralism." As a result, Lumumba was labeled a communist for his refusal to be a Cold War satellite for the western sphere. Rather, Lumumba was part of the Pan-African movement that was led by Ghanaian President Kwame Nkrumah (who later Kennedy would also work with), which sought national sovereignty and an end to colonialism in Africa. Lumumba “would remain a grave danger,” Dulles said at an NSC meeting on September 21, 1960, “as long as he was not yet disposed of.” Three days later, Dulles made it clear that he wanted Lumumba permanently removed, cabling the CIA’s Leopoldville station, “We wish give [sic] every possible support in eliminating Lumumba from any possibility resuming governmental position.” Lumumba was assassinated on Jan. 17th, 1961, just three days before Kennedy’s inauguration, during the fog of the transition period between presidents, when the CIA is most free to tie its loose ends, confident that they will not be reprimanded by a new administration that wants to avoid scandal on its first days in office. Kennedy, who clearly meant to put a stop to the Murder Inc. that Dulles had created and was running, would declare to the world in his inaugural address on Jan. 20th, 1961, “The torch has been passed to a new generation of Americans.” La Resistance Along with inheriting the responsibility of the welfare of the country and its people, Kennedy was to also inherit a secret war with communist Cuba run by the CIA. The Bay of Pigs set-up would occur three months later. Prouty compares the Bay of Pigs incident to that of the Crusade for Peace; the Bay of Pigs being orchestrated by the CIA, and the Crusade for Peace sabotaged by the CIA, in both cases to ruin the U.S. president’s (Eisenhower and Kennedy) ability to form a peaceful dialogue with Khrushchev and decrease Cold War tensions. Both presidents’ took onus for the events respectively, despite the responsibility resting with the CIA. However, Eisenhower and Kennedy understood, if they did not take onus, it would be a public declaration that they did not have any control over their government agencies and military. Further, the Bay of Pigs operation was in fact meant to fail. It was meant to stir up a public outcry for a direct military invasion of Cuba. On public record is a meeting (or more aptly described as an intervention) with CIA Deputy Director for Plans Richard Bissell, Joint Chiefs Chairman Lyman Lemnitzer, and Navy Chief Admiral Burke basically trying to strong-arm President Kennedy into approving a direct military attack on Cuba. Admiral Burke had already taken the liberty of positioning two battalions of Marines on Navy destroyers off the coast of Cuba “anticipating that U.S. forces might be ordered into Cuba to salvage a botched invasion.”[7] (This incident is what inspired the Frankenheimer movie “Seven Days in May.”) Kennedy stood his ground. “They were sure I’d give in to them,” Kennedy later told Special Assistant to the President Dave Powers. “They couldn’t believe that a new president like me wouldn’t panic and try to save his own face. Well they had me figured all wrong.” Incredibly, not only did the young president stand his ground against the Washington war hawks just three months into his presidential term, but he also launched the Cuba Study Group which found the CIA to be responsible for the fiasco, leading to the humiliating forced resignation of Allen Dulles, Richard Bissell and Charles Cabell. (For more on this refer to my report.) Unfortunately, it would not be that easy to dethrone Dulles, who continued to act as head of the CIA, and key members of the intelligence community such as Helms and Angleton regularly bypassed McCone (the new CIA Director) and briefed Dulles directly. But Kennedy was also serious about seeing it through all the way, and vowed to “splinter the CIA into a thousand pieces and scatter it to the winds.” * * * There is another rather significant incident that had occurred just days after the Bay of Pigs, and which has largely been overshadowed by the Cuban fiasco in the United States. From April 21-26th, 1961, the Algiers putsch or Generals’ putsch, was a failed coup d’état intended to force President de Gaulle (1959-1969) not to abandon the colonial French Algeria. The organisers of the putsch were opposed to the secret negotiations that French Prime Minister Michel Debré had started with the anti-colonial National Liberation Front (FLN). On January 26th, 1961, just three months before the attempted coup d’état, Dulles sent a report to Kennedy on the French situation that seemed to be hinting that de Gaulle would no longer be around, “A pre-revolutionary atmosphere reigns in France… The Army and the Air Force are staunchly opposed to de Gaulle…At least 80 percent of the officers are violently against him. They haven’t forgotten that in 1958, he had given his word of honor that he would never abandon Algeria. He is now reneging on his promise, and they hate him for that. de Gaulle surely won’t last if he tries to let go of Algeria. Everything will probably be over for him by the end of the year—he will be either deposed or assassinated.” The attempted coup was led by Maurice Challe, whom de Gaulle had reason to conclude was working with the support of U.S. intelligence, and Élysée officials began spreading this word to the press, which reported the CIA as a “reactionary state-within-a-state” that operated outside of Kennedy’s control. Shortly before Challe’s resignation from the French military, he had served as NATO commander in chief and had developed close relations with a number of high-ranking U.S. officers stationed in the military alliance’s Fontainebleau headquarters. In August 1962 the OAS (Secret Army Organization) made an assassination attempt against de Gaulle, believing he had betrayed France by giving up Algeria to Algerian nationalists. This would be the most notorious assassination attempt on de Gaulle (who would remarkably survive over thirty assassination attempts while President of France) when a dozen OAS snipers opened fire on the president’s car, which managed to escape the ambush despite all four tires being shot out. After the failed coup d’état, de Gaulle launched a purge of his security forces and ousted General Paul Grossin, the chief of SDECE (the French secret service). Grossin was closely aligned with the CIA, and had told Frank Wisner over lunch that the return of de Gaulle to power was equivalent to the Communists taking over in Paris. In 1967, after a five-year enquête by the French Intelligence Bureau, it released its findings concerning the 1962 assassination attempt on de Gaulle. The report found that the 1962 assassination plot could be traced back to the NATO Brussels headquarters, and the remnants of the old Nazi intelligence apparatus. The report also found that Permindex had transferred $200,000 into an OAS bank account to finance the project. As a result of the de Gaulle exposé, Permindex was forced to shut down its public operations in Western Europe and relocated its headquarters from Bern, Switzerland to Johannesburg, South Africa, it also had/has a base in Montreal, Canada where its founder Maj. Gen. Louis M. Bloomfield (former OSS) proudly had his name amongst its board members until the damning de Gaulle report. The relevance of this to Kennedy will be discussed shortly. As a result of the SDECE’s ongoing investigation, de Gaulle made a vehement denunciation of the Anglo-American violation of the Atlantic Charter, followed by France’s withdrawal from the NATO military command in 1966. France would not return to NATO until April 2009 at the Strasbourg-Kehl Summit. In addition to all of this, on Jan. 14th, 1963, de Gaulle declared at a press conference that he had vetoed British entry into the Common Market. This would be the first move towards France and West Germany’s formation of the European Monetary System, which excluded Great Britain, likely due to its imperialist tendencies and its infamous sin City of London. Former Secretary of State Dean Acheson telegrammed West German Chancellor Konrad Adenauer directly, appealing to him to try to persuade de Gaulle to back track on the veto, stating “if anyone can affect Gen. de Gaulle’s decision, you are surely that person.” Little did Acheson know that Adenauer was just days away from signing the Franco-German Treaty of Jan 22nd, 1963 (also known as the ÉlyséeTreaty), which had enormous implications. Franco-German relations, which had long been dominated by centuries of rivalry, had now agreed that their fates were aligned. (This close relationship was continued to a climactic point in the late 1970s, with the formation of the European Monetary System, and France and West Germany’s willingness in 1977 to work with OPEC countries trading oil for nuclear technology, which was sabotaged by the U.S.-Britain alliance. The Élysée Treaty was a clear denunciation of the Anglo-American forceful overseeing that had overtaken Western Europe since the end of WWII. On June 28th, 1961, Kennedy wrote NSAM #55. This document changed the responsibility of defense during the Cold War from the CIA to the Joint Chiefs of Staff and would have (if seen through) drastically changed the course of the war in Vietnam. It would also have effectively removed the CIA from Cold War military operations and limited the CIA to its sole lawful responsibility, the collecting and coordination of intelligence. By Oct 11th, 1963, NSAM #263, closely overseen by Kennedy[14], was released and outlined a policy decision “to withdraw 1,000 military personnel [from Vietnam] by the end of 1963” and further stated that “It should be possible to withdraw the bulk of U.S. personnel by 1965.” The Armed Forces newspaper Stars and Stripes had the headline U.S. TROOPS SEEN OUT OF VIET BY ’65. It would be the final nail in the coffin. Treason in America “Treason doth never prosper; what is the reason? Why, if it prosper, none dare call it treason.” – Sir John Harrington By Germany supporting de Gaulle’s exposure of the international assassination ring, his adamant opposition to western imperialism and the role of NATO, and with a young Kennedy building his own resistance against the imperialist war of Vietnam, it was clear that the power elite were in big trouble. On November 22nd, 1963 President Kennedy was brutally murdered in the streets of Dallas, Texas in broad daylight. With the assassination of Ngo Dinh Diem, likely ordained by the CIA, on Nov. 2nd, 1963 and Kennedy just a few weeks later, de facto President Johnson signed NSAM #273 on Nov. 26th, 1963 to begin the reversal of Kennedy’s policy under #263. And on March 17th, 1964, Johnson signed NSAM #288 that marked the full escalation of the Vietnam War and involved 2,709,918 Americans directly serving in Vietnam, with 9,087,000 serving with the U.S. Armed Forces during this period. The Vietnam War would continue for another 12 years after Kennedy’s death, lasting a total of 20 years for Americans, and 30 years if you count American covert action in Vietnam. Two days before Kennedy’s assassination, a hate-Kennedy handbill was circulated in Dallas accusing the president of treasonous activities including being a communist sympathizer. On November 29th, 1963 the Warren Commission was set up to investigate the murder of President Kennedy. The old Congressman Hale Boggs of Louisiana was a member of that Warren Commission. Boggs became increasingly disturbed by the lack of transparency and rigour exhibited by the Commission and became convinced that many of the documents used to incriminate Oswald were in fact forgeries. In 1965 Rep. Boggs told New Orleans District Attorney Jim Garrison that Oswald could not have been the one who killed Kennedy. It was Boggs who encouraged Garrison to begin the only law enforcement prosecution of the President’s murder to this day. Nixon was inaugurated as President of the United States on Jan 20th, 1969. Hale Boggs soon after called on Nixon’s Attorney General John Mitchell to have the courage to fire J. Edgar Hoover. It wasn’t long thereafter that the private airplane carrying Hale Boggs disappeared without a trace. Jim Garrison was the District Attorney of New Orleans from 1962 to 1973 and was the only one to bring forth a trial concerning the assassination of President Kennedy. In Jim Garrison’s book “On the Trail of the Assassins”, J. Edgar Hoover comes up several times impeding or shutting down investigations into JFK’s murder, in particular concerning the evidence collected by the Dallas Police Department, such as the nitrate test Oswald was given and which exonerated him, proving that he never shot a rifle the day of Nov 22nd, 1963. However, for reasons only known to the government and its investigators this fact was kept secret for 10 months. It was finally revealed in the Warren Commission report, which inexplicably didn’t change their opinion that Oswald had shot Kennedy. Another particularly damning incident was concerning the Zapruder film that was in the possession of the FBI and which they had sent a “copy” to the Warren Commission for their investigation. This film was one of the leading pieces of evidence used to support the “magic bullet theory” and showcase the direction of the headshot coming from behind, thus verifying that Oswald’s location was adequate for such a shot. During Garrison’s trial on the Kennedy assassination (1967-1969) he subpoenaed the Zapruder film that for some peculiar reason had been locked up in some vault owned by Life magazine (the reader should note that Henry Luce the owner of Life magazine was in a very close relationship with the CIA). This was the first time in more than five years that the Zapruder film was made public. It turns out the FBI’s copy that was sent to the Warren Commission had two critical frames reversed to create a false impression that the rifle shot was from behind. When Garrison got a hold of the original film it was discovered that the head shot had actually come from the front. In fact, what the whole film showed was that the President had been shot from multiple angles meaning there was more than one gunman. When the FBI was questioned about how these two critical frames could have been reversed, they answered self-satisfactorily that it must have been a technical glitch… There is also the matter of the original autopsy papers being destroyed by the chief autopsy physician, James Humes, to which he even testified to during the Warren Commission, apparently nobody bothered to ask why… This would explain why the Assassination Records Review Board (ARRB), reported in a July 1998 staff report their concern for the number of shortcomings in the original autopsy, that “One of the many tragedies of the assassination of President Kennedy has been the incompleteness of the autopsy record and the suspicion caused by the shroud of secrecy that has surrounded the records that do exist.” [emphasis added] The staff report for the Assassinations Records Review Board contended that brain photographs in the Kennedy records are not of Kennedy’s brain and show much less damage than Kennedy sustained. There is a lot of spurious effort to try to ridicule anyone who challenges the Warren Commission’s official report as nothing but fringe conspiracy theory. And that we should not find it highly suspect that Allen Dulles, of all people, was a member and pretty much leader of said commission. The reader should keep in mind that much of this frothing opposition stems from the very agency that perpetrated crime after crime on the American people, as well as abroad. When has the CIA ever admitted guilt, unless caught red-handed? Even after the Church committee hearings, when the CIA was found guilty of planning out foreign assassinations, they claimed that they had failed in every single plot or that someone had beaten them to the punch, including in the case of Lumumba. The American people need to realise that the CIA is not a respectable agency; we are not dealing with honorable men. It is a rogue force that believes that the ends justify the means, that they are the hands of the king so to speak, above government and above law. Those at the top such as Allen Dulles were just as adamant as Churchill about protecting the interests of the power elite, or as Churchill termed it, the “High Cabal.” Interestingly, on Dec. 22nd, 1963, just one month after Kennedy’s assassination, Harry Truman published a scathing critique of the CIA in The Washington Post, even going so far as to state “There is something about the way the CIA has been functioning that is casting a shadow over our historic position [as a] free and open society, and I feel that we need to correct it.” The timing of such a scathing quote cannot be stressed enough. Dulles, of course, told the public not to be distressed, that Truman was just in entering his twilight years. In addition, Jim Garrison, New Orleans District Attorney at the time, who was charging Clay Shaw as a member of the conspiracy to kill Kennedy, besides uncovering his ties to David Ferrie who was found dead in his apartment days before he was scheduled to testify, also made a case that the New Orleans International Trade Mart (to which Clay Shaw was director), the U.S. subsidiary of Permindex, was linked to Kennedy’s murder. Col. Clay Shaw was an OSS officer during WWII, which provides a direct link to his knowing Allen Dulles. Garrison did a remarkable job with the odds he was up against, and for the number of witnesses that turned up dead before the trial… This Permindex link would not look so damning if we did not have the French intelligence SDECE report, but we do. And recall, in that report Permindex was caught transferring $200,000 directly to the bankroll of the OAS which attempted the 1962 assassination on de Gaulle. Thus, Permindex’s implication in an international assassination ring is not up for debate. In addition, the CIA was found heavily involved in these assassination attempts against de Gaulle, thus we should not simply dismiss the possibility that Permindex was indeed a CIA front for an international hit crew. In fact, among the strange and murderous characters who converged on Dallas in Nov. 1963 was a notorious French OAS commando named Jean Souetre, who was connected to the plots against President de Gaulle. Souetre was arrested in Dallas after the Kennedy assassination and expelled to Mexico, not even kept for questioning. What Does the Future Hold? After returning from Kennedy’s Nov. 24th funeral in Washington, de Gaulle and his information minister Alain Peyrefitte had a candid discussion that was recorded in Peyrefitte’s memoire “C’était de Gaulle,” the great General was quoted saying: “What happened to Kennedy is what nearly happened to me… His story is the same as mine. … It looks like a cowboy story, but it’s only an OAS [Secret Army Organization] story. The security forces were in cahoots with the extremists. …Security forces are all the same when they do this kind of dirty work. As soon as they succeed in wiping out the false assassin, they declare the justice system no longer need be concerned, that no further public action was needed now that the guilty perpetrator was dead. Better to assassinate an innocent man than to let a civil war break out. Better an injustice than disorder. America is in danger of upheavals. But you’ll see. All of them together will observe the law of silence. They will close ranks. They’ll do everything to stifle any scandal. They will throw Noah’s cloak over these shameful deeds. In order to not lose face in front of the whole world. In order to not risk unleashing riots in the United States. In order to preserve the union and to avoid a new civil war. In order to not ask themselves questions. They don’t want to know. They don’t want to find out. They won’t allow themselves to find out.” The American people would do well to remember that it was first John F. Kennedy, acting as the President to the United States, who was to be declared a terrorist and threat to his country’s national security. Thus is it not natural that those who continue to defend the legacy of Kennedy should be regarded today as threat, not truly to the nation’s security, but a threat to the very same grouping responsible for Kennedy’s death and whom today have now declared open war on the American people. This will be the greatest test the American people have ever been confronted with, and it will only be through an understanding of how the country came to where it is today that there can be sufficient clarity as to what the solutions are, which are not to be found in another civil war. To not fall for the trapping of further chaos and division, the American people will only be able to rise above this if they choose to ask those questions, if they choose to want to know, to want to find out the truth of things they dared not look at in the past for fear of what it would reveal. “Whenever the government of the United States shall break up, it will probably be in consequence of a false direction having been given to public opinion. This is the weak point of our defenses, and the part to which the enemies of the system will direct all their attacks. Opinion can be so perverted as to cause the false to seem true; the enemy, a friend, and the friend, an enemy; the best interests of the nation to appear insignificant, and the trifles of moment; in a word, the right the wrong, the wrong the right. In a country where opinion has sway, to seize upon it, is to seize upon power. As it is a rule of humanity that the upright and well-intentioned are comparatively passive, while the designing, dishonest, and selfish are the most untiring in their efforts, the danger of public opinion’s getting a false direction is four-fold, since few men think for themselves.” -James Fenimore Cooper (1789-1851) We must dare to be among the few who think for ourselves. Tyler Durden Mon, 11/22/2021 - 22:20.....»»

Category: blogSource: zerohedgeNov 22nd, 2021

Transcript: Edwin Conway

   The transcript from this week’s, MiB: Edwin Conway, BlackRock Alternative Investors, is below. You can stream and download our full conversation, including the podcast extras on iTunes, Spotify, Google, Bloomberg, and Acast. All of our earlier podcasts on your favorite pod hosts can be found here. ~~~ BARRY RITHOLTZ, HOST, MASTERS IN BUSINESS:… Read More The post Transcript: Edwin Conway appeared first on The Big Picture.    The transcript from this week’s, MiB: Edwin Conway, BlackRock Alternative Investors, is below. You can stream and download our full conversation, including the podcast extras on iTunes, Spotify, Google, Bloomberg, and Acast. All of our earlier podcasts on your favorite pod hosts can be found here. ~~~ BARRY RITHOLTZ, HOST, MASTERS IN BUSINESS: This week on the podcast, man, I have an extra special guest. Edwin Conway runs all of alternatives for BlackRocks. His title is Global Head of Alternative Investors and he covers everything from structured credit to real estate hedge funds to you name it. The group runs over $300 billion and he has been a driving force into making this a substantial portion of Blackrock’s $9 trillion in total assets. The opportunity set that exists for alternatives even for a firm like Blackrock that specializes in public markets is potentially huge and Blackrock wants a big piece of it. I found this conversation to be absolutely fascinating and I think you will also. So with no further ado, my conversation with Blackrock’s Head of Alternatives, Edwin Conway. MALE VOICEOVER: This is Masters in Business with Barry Ritholtz on Bloomberg Radio. RITHOLTZ: My extra special guest this week is Edwin Conway. He is the Global Head of Blackrock’s Alternative Investors which runs about $300 billion in assets. He is a team of over 1,100 professionals to help him manage those assets. Blackrock’s Global alternatives include businesses that cover real estate infrastructure, hedge funds private equity, and credit. He is a senior managing director for BlackRock. Edwin Conway, welcome to Bloomberg. EDWIN CONWAY, GLOBAL HEAD OF ALTERNATIVE INVESTORS, BLACKROCK: Barry, thank you for having me. RITHOLTZ: So, you’ve been in the financial services industry for a long time. You were at Credit Suisse and Blackstone and now you’re at BlackRock. Tell us what the process was like breaking into the industry? CONWAY: It’s an interesting on, Barry. I grew up in a very small town in the middle of Ireland. And the breakthrough to the industry was one of more coincident as opposed to purpose. I enjoyed the game of rugby for many years and through an introduction while at the University, in University College Dublin in Ireland, had a chance to play rugby at a quite a – quite a decent level and get to know people that were across the industry. It was really through and internship and the suggestion, I’ve given my focus on business and financing things that the financial services sector may be a great place to traverse and get to know. And literally through rugby connections, been part of a good school, I had an opportunity to really understand what the service sector, in many respects, could provide to clients and became absolutely intrigued with it. And what – was it my primary ambition in life to be in the financial services sector? I can definitively say no, but through the circumstance of a game that I love to play and be part of, I was introduced to, through an internship, and actually fell in love with it. RITHOLTZ: Quite interesting. And alternative investments at Blackrock almost seems like a contradiction in terms. Most of us tend to think of Blackrock as the giant $9 trillion public markets firm best known for ETFs and indices. Alternatives seems to be one of the fastest-growing groups within the firm. This was $50 billion just a few years ago, it’s now over 300 billion. How has this become such a fast-growing part of BlackRock? CONWAY: When you look at the various facets which you introduced at the start, Barry, we’ve actually been an alternatives – will be of 30 years now. Now, the scale, as you know, which you can operate on the beta side of business, far surpasses that on the alpha side. For us, throughout the years, this was very much about how can we deliver investment excellence to our clients and performance? Therefore, going an opportunity somewhere else to explore an alpha opportunity in alternatives. And I think being so connected to our clients understanding, that this pivots was absolutely taking place at only 30 years ago but in a very pronounced way today, you know, we continue to invest in this business to support those ambitions. They’re clearly seeing this as the world of going through a tremendous amount of transformation and with some of the challenges, quite frankly, in the traditional asset classes, being able to leverage at BlackRock, the Blackrock muscle to really explore these alpha opportunities across the various alternative asset classes that in our mind wasn’t imperative. And the imperative, really, is from the firm’s perspective and if you look at our purpose, it’s to serve the client. So the need was coming from them. The necessity to have alternatives and their whole portfolio was very – was very much growing in prominence. And it’s taken us 30 years to build this journey and I think, Barry, quite frankly, we’re far from being done. As you look at the industry, the demand is going to continue to grow. So, I think you could expect to see from us a continued investment in the space because we don’t believe you can live without alternatives in today’s world. RITHOLTZ: That’s really – that’s really interesting. So let’s dive a little deeper into the product strategy for alternatives which you are responsible for at BlackRock. Our audiences is filled with potential investors. Tell them a little bit about what that strategy is. CONWAY: So we’re – I think as you mentioned, we’re in excess of 300 billion today and when we started this business, it was less about building a moat around private equity or real estate. I think Larry Fink’s and Rob Kapito’s vision was how do we build a platform to allow us to be relevant to our clients across the various alternative asset classes but also within the – within the confines of what they are permitted to do on a year-by-year basis. So, to always be relevant irrespective of where they are in their journey from respect of liabilities, demand for liquidity, demand for returns, so we took a different approach. I think, Barry, to most, it was around how do we scale into the business across, like you said, real estate equity and debt, infrastructure equity and debt. I mean, we think of that as the real assets platform of our business. Then you take our private equity capabilities both in primary investing, secondary et cetera, and then you have private credits and a very significant hedge fund platforms. So we think all of these have a real role and depending on clients liquidities and risk appetite, our goal was, to over the years, really build in to this to allow ourselves for this challenging needs that our clients have. I think as an industry, right, and over the many years alternatives have been in existence, this is been about return enhancement initially. I think, fundamentally, the changes around the receptivity to the role of alternatives in a client’s portfolio has really changed. So, we’ve watched it, Barry, from this is we’re in the pursuit of a very total return or absolute return type of an objective to now resilience in our portfolio, yield an income. And so things that probably weren’t perceived as valuable in the past because the traditional asset classes were playing a more profound role, alternatives have stepped up in – in many respects in the need to provide more than just total return. So, we’re taking the approach of how do you have a more holistic approach to this? How do we really build a global multi-alternatives capability and try to partner and I think that’s the important work for us. Try to partner with our clients in a way that we can deliver that outperformance but delivered in a way that probably our clients haven’t been used to in this industry before. Because unfortunately, as we know, it has had its challenges with regard to secrecy, transparency, and so many other aspects. We need to help the industry mature. And really that was our ambition. Put our client’s needs first, build around that and really be relevant in all aspects of what we’re doing or trying to accomplish on behalf of the people that they support and represent. RITHOLTZ: So, we’ll talk a little bit about transparency and secrecy and those sorts of things later. But right now, I have to ask what I guess is kind of an obvious question. This growth that you’ve achieved within Blackrock for nonpublic asset allocation within a portfolio, what is this coming at expense of? Are these dollars that are being moved from public assets into private assets or you just competing with other private investors? CONWAY: It’s really both. What – what you are seeing from our clients – if I take a step back, today, the institutional client community and you think about the – the retirement conundrum we’re all facing around the world. It’s such an awful challenge when you think how ill-prepared people are for that eventual stepping back from the workplace and then you know longevity is your friend, but can also be a very, very difficult thing to obviously live with if you’re not prepared for retirement. The typical pension plan today are allocating about 25 percent to 28 percent in alternatives. Predominantly private market. What they’re telling us is that’s increasing quite substantially going forward. But you know, the funding for that alpha pursue for that diversification and that yield is coming from fixed-income assets. It’s coming from equity assets. So there’s a real rebalancing that’s been taking place over the past number of years. And quite frankly, the evolution, and I think the innovation that’s taken place particularly in the past 10 years, alternatives has been really profound. So the days where you just invest in any global funds still exist. But now you can concentrate your efforts on sector exposure, industry exposures, geographic exposures, and I think the – the menu of things our clients can now have access to has just been so greatly enhanced at and the benefit is that but I think in some – in some respects, Barry, the next question is with all of those choices, how do you build the right portfolio for our client’s needs knowing that each one of our client’s needs are different? So, I would say it absolutely coming from the public side. We’re very thankful. Those that had a multiyear journey with us in the public side are now allocating capital to is now the private side to because I do think the – the industry given that change, given that it evolution and given the complexity of these private assets, our clients are looking to, quite frankly, do more with fewer managers because of the complexion of the industry and complexity that comes with it. RITHOLTZ: Quite – quite interesting. (UNKNOWN): And attention RIA’s. Are your clients asking for crypto? At interactive brokers, advisers can now offer crypto to their clients and you could trade stocks, options, futures currencies, bonds and more from the same platform. Commissions on crypto are just 12-18 basis points with no hidden spreads or markups and there are no ticket charges, custody fees, minimums platform or reporting fees. Learn more at IBKR.com/RIA crypto. RITHOLTZ: And I – it’s pretty easy to see why large institutions might be rotating away from things like treasuries or tips because there’s just no yield there. Are you seeing inflows coming in from the public equity side also? The markets put together a pretty good string of years. CONWAY: Yes. It absolutely has. And many respects, I think, we’ve had a multiyear where there was big questions around the alpha that can be generated, for example, from active equities? The question was active or passive? I think what we’ve all realized is that at times when volatility introduces itself which is frequent even independent of what’s been done from a fiscal and monetary standpoint, that these Alpha speaking strategies on the traditional side still make a lot of sense. And so, as we think about what – what’s happening here, the transition of assets from both passive and active strategies to alternative, it – it’s really to create better balance. It’s not that there’s – there’s a lack of relevance anymore in the public side. It’s just quite frankly the growth of the private asset base has grown so substantially. I moved, Barry, to the U.S. in 1998. And it’s interesting, when you look back at 1998 to today, you start to recognize the equity markets and what was available to invest in. The number of investable opportunities has shrunk by 40 plus percent which that compression is extraordinarily high. But yet you’ve seen, obviously, the equity markets grow in stature and significance and prominence but you’re having more concentration risk with some of the big public entities. The converse is true, though on the – on the private side. There’s this explosion of enterprise and innovation, employment creation, and then I believe opportunities has been real. So, I look at the public side, the investable universe is measured in the thousands and the private side is measured in the millions. RITHOLTZ: Wow. CONWAY: And I think part of the – part of the part of the thing our clients are not struggling with but what we’re really recognizing with – with enterprises staying private for longer, if not forever, and with his growth of the opportunities that open debt and equity in the private market side, you really can’t forgo this opportunity. It has to be part of your going forward concerns and asset allocation. And I think this is why we’re seeing that transformation. And it’s not because equities on fixed income just aren’t relevant anymore. They’re very relevant but they’re relevant now in a total portfolio or a whole portfolio context beside alternatives. RITHOLTZ: So, let’s discuss this opportunity set of alternatives where you guys at Blackrock scene demand what sectors and from what sorts of clients? Is this demand increasing? CONWAY: We’re very fortunate, Barry. Today, there isn’t a single piece of our business within – within Blackrock alternatives that isn’t growing. And quite frankly too, it’s really up to us to deliver on the investment objectives that are set forth for those clients. I think in the back of strong absolute and relative performance, thankfully, our clients look to us to – to help them as – as they think about what they’re doing and as they’re exploring more in the alternatives areas. So, as you know, certainly, the private equity and real estate allocations are quite mature in many of our client’s portfolios but they’ve been around for many decades. I think that the areas where we’re seeing – that’s called an outside demand and opportunity set, just but virtue of the small allocations on a relative basis that exist today is really around infrastructure, Barry, and its around private credits. So, to caveat that, I think all of the areas are certainly growing, and thankfully, for us that’s true. We’re looking at clients who we believe are underinvested, we believe they’re underinvested in those asset classes infrastructure both debt and equity and in private credit. And as you think about why that is, the attributes that they bring to our client is really important and in a world where your correlation and understanding those correlations is important that these are definitely diversifying assets. In a world where you’re seeing trillions of dollars, quite frankly, you’re providing little to no or even there’s negative yield. Those short falls are real and people need yield than need income. These assets tend to provide that. So the diversification, it comes from these assets. The yield can come from these assets and because of the immaturity of the asset classes, independence of the capital is flowing in, we still consider them relatively white space. You’re not crowded out. There’s much room for development in the market and with our client’s portfolios. And to us, that’s exciting because it presents opportunities. So, at the highest level, they’re the areas where I believe are most underdeveloped in our clients. RITHOLTZ: So let’s talk about both of those areas. We’ll talk about structured credit in a few minutes. I think everybody kind of understands what – what that is. What – when you see infrastructure as a sector, how does that show up as an investment are – and obviously, I have infrastructure on the brink because we’re recording this not too long after the giant infrastructure bill has been passed, tell us a little bit about what alternative investments in infrastructure looks like? CONWAY: Yes. It’s really in its infancy and what the underlying investments look like. I think traditionally, you would consider it as – and part of the bill that has just been announced, roads, bridges, airports. Some of these hard assets, some of the core infrastructure investments that have been around for actually some time. The interesting thing is the industry has evolved so much and put the need for infrastructure. It’s so great across both developed and emerging economies. It’s become something that if done the right way, the attributes we just spoke of can really have a very strong effect on our client’s portfolios. So, beyond the core that we just mentioned, well, we’ve seen a tremendous demand as a result of this energy transition. You’re really seeing a spike in activity and the necessity transition industry to cleaner technologies, a movement, not away completely from fossil fuel but integrating new types of clean energy. And as a result, you’ve seen a lot of demand on a global basis for wind and solar. And quite frankly, that’s why even us at BlackRock, albeit, 10-12 years ago, we really established a capability there to help with that transition to think about how do we use these technologies, solar panels, wind farms, to generate clean forms of energy for utilities where in some cases they’re mandated to procure this type of this type of – this type of power. And when you think about pre-contracting with utilities for long duration, that to me spells, Barry, good risk mitigation and management and ability to get access to clean forms of energy that throw off yield that can be very complementary to your traditional asset classes but for very long periods of time. And so, the benefits for us of these – these assets is that they are long in duration, they are yield enhancing, they’re definitely diversifying. And so, for us, where – we’ve got about, let’s call this 280 assets around the world that we’re managing that literally generate this – this clean electricity. I think to give the relevance of how much, I believe today, it’s enough to power the country of Spain. RITHOLTZ: Wow. CONWAY: And that’s really that’s really changing. So you’re seeing governments – so from a policy standpoint, you’re seeing governments really embracing new forms of energy, transitioning out of bunker fuels, for example, you know, burning diesels which really spew omissions into the – into the into the environment. But it’s really around modernizing for the future. So, developed and emerging economies alike, want to retain capital. They want to attract new capital and by having the proper infrastructure to support industry, it’s a really, really important thing. Now, on the back of that too, one things we’ve learned from COVID is that the necessity to really bring e-commerce into how you conduct your business is so important and I think from the theme of digitalization within infrastructure to is a huge part. So, it’s not just the energy transition that you’re seeing, it’s not just roads and bridges, but by allowing businesses to connect to a global consumer, allowing children be educated from home, allowing experiences that expand geographies and boundaries in a digital form is so important not just for commerce but in so many other aspects. And so, you think about cable, fiber optics, if you think about all the other things even outside of power, that enable us to conduct commerce to educate, there are many examples where, Barry, you can build resilience into your portfolio because that need is not measured in years. Actually, the shortfall of capital is measured in the trillions so which means this is – this is a multi-decade opportunity set from our vantage point and one of which our clients should really avail of. RITHOLTZ: Quite interesting. And I mentioned in passing, structured credit, tell us a little bit about what that opportunity looks like. I think of this as a space that is too big for local banks but too small for Wall Street to finance. Is that an oversimplification? What is going on in that space. CONWAY: I probably couldn’t have set it better, Barry. It’s – if we go back to just the even the investable universe, in the tens of thousands of companies, just if we take North America that are private, that have great leadership that really have strategic vision under – at the – in some cases, at the start of their growth lifecycles are even if they maintain, they have a very credible and viable business for the future they still need capital. And you’re absolutely right. With the retreat of the banks from the space to various regulations that have come after the global financial crisis, you’re seeing the asset managers in many respects working behalf of our clients both wealth and institutional becoming the new lenders of choice. And – and when we – when we think about that opportunity set, that is really understanding the client’s desire for risk or something maybe in a lower risk side from middle-market lending or midmarket enterprises where you can support that organization through its growth cycle all the way to some higher-yielding, obviously, with more risk assets on the opportunistic or even the special situations side. But it – it expands many things. And going back of the commentary around the evolution of the space, private credit today and what you can do has changed so profoundly, it expands the liquidity spectrum, it expands the risk spectrum. And the great news is, with the number of companies both here and abroad, the opportunities that is – it’s being enriched every single day. And were certainly seeing, particularly going back to the question are some of these assets coming from the traditional side, the public side. When we think of private credit, you are seeing private credit now been incorporated in fixed-income allocations. This is a – it’s a yelling asset. This is – these are debt instruments, these are structures that we’re creating. We’re trying to flexible and dynamic with these clients. But it really is an area where we think – it really is still at its – at its infancy relevant to where it can potentially be. RITHOLTZ: That’s really quite – quite interesting. (UNKNOWN): It’s Rob Riggle. I’m hosting Season 2 of the iHeart radio podcast, Veterans You Should Know. You may know me as the comedic actor from my work in the Hangover, Stepbrothers or 21 Jump Street. But before Hollywood, I was a United States Marine Corps officer for 23 years. For this Veterans Day, I’ll be sitting down with those who proudly served in the Armed Forces to hear about the lessons they’ve learned, the obstacles they’ve overcome, and the life-changing impact of their service. Through this four-part series, we’ll hear the inspiring journeys of these veterans and how they took those values during their time of service and apply them to transition out of the military and into civilian life. Listen to Veterans You Should Know on the iHeart radio app, Apple Podcast or wherever you get your podcast. RITHOLTZ: Let’s stick with that concept of money rotating away from fixed income. I have to imagine clients are starved for yields. So what are the popular substitutes for this? Is it primarily structured credit? Is it real estate? How do you respond to an institution that says, hey, I’m not getting any sort of realistic coupon on my bonds, I need a substitute? CONWAY: Yes. It’s all of those in many respects. And I think to the role, even around now a time where people have questions around inflation, how do substitute this yield efficiency or certainly make up for that shortfall, how do you think about a world where increasingly seeing inflation, not of the transitory thing it feels certainly quasi-permanent. These are a lot of questions we’re getting. And certainly, real estate is an is important part of how they think about inflation protection, how client think about yield, but quite frankly too, we’ve – we’ve gone through something none of us really had thought about a global pandemic. And as I think about real estate, just how you allocate to the sector, what was very heavily influenced with retail assets, high street, our shopping behaviors and habits have changed. We all occupied offices for obviously many, many years pre the pandemic. The shape of how we operate and how we do that has changed. So, I think some of the underlying investment – investments have changed where you’ve seen heavily weighted towards office space to leisure, travel in the past. Actually, now using a rotation in some respects out of those, just given some of the uncertainties around what the future holds as we come – come through a really difficult time. But the great thing about this sector is between senior living, between student housing, between logistics and so many other parts, there are ways in real estate to capture where there’s – where there’s demand. So still a robust opportunity set and it – and we do think it can absolutely be yield enhancing. We mentioned infrastructure. Even if you think about – and we mention OECD and non-OECD, emerging and developed, when I think about Asia, in particular, just as a subset of the world in which we’re living in, that is a $2.6 trillion alternative market today growing at a 15 percent CAGR. And quite frankly, the old-growth is driven by the large economic growth in the region. So, even from a regional perspective, if we pivot, it houses 57 percent of the world’s population and yet delivers 47 percent of the world’s economic growth. So, think of that and then with regard to infrastructure and goes back to that, this is truly a global phenomenon. So if we just even take that sector, Barry, you’ll realize that the way to maintain that type of growth, to attract capital, to keep capital, it really requires an investment of significant amount of money to be able to sustain that. And when you have 42 million people in a APAC migrating to cities in the year going back to digitalization, that’s an important thing. So, when I say we’re so much at the infancy in infrastructure, I really mean it. It can be water, it can be sewer systems, it can be digital, it can be roads, there’s so much to this. And then even down to the regional perspective, it’s a – it’s a need that doesn’t just exist in the U.S. So, for these assets, this tend to be long in duration. There’s both equity and debt. And on the debt side, quite frankly, very few outside of our insurance clients and their general account are taking advantage of the debt opportunity. And – and as we both know, to finance these projects that are becoming more plentiful every single day, across the world, including like, I said, in APAC in scale, there’s an opportunity in both sides. And I think that’s where the acid mix change happen. It’s recognizing that the attributes of these assets can have a role, the attributes of these assets can potentially replace some of these traditional assets and I think you’re going to see it grow. So, infrastructure to us, it’s really equity and debt. And then on the credit side, like I mentioned, again, too, it’s a very, very big and growing market. And certainly, the biggest area today from our vantage point is middle-market lending from a scale opportunity standpoint. So, we think much more to come in all of those spaces. RITHOLTZ: Really interesting. And let’s just stay with the concept of public versus private. That line is kind of getting blurred and the secondary markets is liquidity coming to, for lack of a better phrase, pre-public equities, tells little bit about that space. Is that an area that is ripe for growth for BlackRock? CONWAY: Yes. We absolutely think it is and you’re absolutely correct. The secondary market is – has grown quite substantial. If you even look at just the private equity secondary market and what will transact this year, I think it will be potentially in excess of 100 billion. And that’s what were clear, not to mention what will be visible and what will be analyzed. And that speaks to me what’s really happening and the innovation that we mentioned earlier. It’s no longer about just primary exposure. It’s secondary exposure. When we see all sort of interest and co-investment opportunities as well, I think the available sources of alpha and the flexibility you can now have, albeit if directed and advised, I believe the right way, Barry, can be very helpful and in the portfolio. So, your pre-IPO, it is a big part of actually what we do and we think about growth equity. There is – it’s a significant amount of capital following that space. Now, from our vantage point, as one of the largest investors in the public equity market and now obviously one of the largest investors and they in the private side, the bridge between – between private to public – there’s a real need. IPOs are not going away. And I think smart, informed capital to help with this journey, this journey is really – is really a necessity and a need. RITHOLTZ: So let’s talk a little bit about this recent restructuring. You are first named Global Head of Blackrock Alternative Investors in April 2019, the entire alternatives business was restructured, tell us a little bit about how that restructuring is going? CONWAY: Continues to go really well, Barry. When you look at the flow of acid from our clients, I think, hopefully, that’s speaks to the performance we’ve been generating. I joined the firm, as you know, albeit, 11 years ago and being very close to the alternative franchise as a critical thing for me and running the institutional platform. To me, when you watched this migration of asset towards alternatives, it was obviously very evident for decades now that this is a critical leg of the stool as our clients are thinking about their portfolios. We’re continuing to innovate. We’re continuing to invest, and thankfully, we’re continuing to deliver strong performance. We’re growing at about high double digits on an annual basis but we’re trying to purposeful too around where that growth is coming from. I think the reality is when you look at the competitive universe, I think the last number I saw, it was about 38,000 alternative asset managers out there today, obviously, coming from hedge funds all the way to private credits and private equity. So, competition is real and I do think the outcomes for our clients are starting to really grow. Unfortunately, some – in some cases, obviously, very good, and in some cases, actually not great. So our focus, Barry, is really much on how can we deliver performance, how can we be a partner? And I think we been rewarded with a trust and the faith our clients have in us because they’re seeing something different, I think, from us. Now, the scale of the business that you mentioned earlier really gives us tentacles into the market that I believe allows us to access what I think is the new alpha which is in many respects, given the heft of competition sourcing and originating new investments is certainly harder but for us, sitting in or having alternative team, sitting in 50 offices around the world, really investing in the markets because that – the market they grew up with and have relationships within, I think this network value that we have is something that’s quite special. And I think in the world that’s becoming increasingly competitive, we’re going to continue to use and harness that network value to pursue opportunities. And thankfully, as a result of the partnership we’ve been pursuing with her clients, like, we’ve – we’re certainly looking for opportunities and investments in our funds. But because of the brand, I think because of the successes, opportunities seeks us as much as we seek opportunity and that has been something that we look at an ongoing basis and feel very privileged to actually have that inbound flow as well. RITHOLTZ: Really quite interesting. There was a quote of yours I found while doing some prep for this conversation that I have to have you expand on. Quote, “The relationship between Blackrock’s alternative capabilities and wealth firms marked a large opportunity for growth in the coming years.” This was back in 2019. So, the first part of the question is, was your expectations correct? Did you – did you see the sort of growth you were hoping for? And more broadly, how large of an opportunity is alternatives, not just for BlackRock but for the entire investment industry? CONWAY: Yes. It’s been very much an institutional opportunity set up until now. And there’s so much to be done, still, to really democratize alternatives and we certainly joke around making alternatives less alternative. Actually, even the nomenclature we use and how we describe it doesn’t kind of make sense anymore. It’s such a core – an important allocation to our clients, Barry, that just calling it alternative seems wrong. Just about the institutional clients. It ranges, I think, as I mentioned on our – some of our more conservative clients which would be pension plans which really have liquidity needs on a monthly basis because of the liabilities they have to think about. At about 25 plus percent in private markets, to endowments, foundations, family offices, going to 50 percent plus. So, it’s a really important part and has been for now many years the institutional client ph communities outcomes. I think the thing that we, as an industry, have to change is alternatives has to be for the many, not for the few. And quite frankly, it’s been for the few. And as we talked about some of the attributes and the important attributes of these asset classes to think that those who have been less fortunate in their careers can’t access, things they can enrich their future retirement outcomes, to me, is a failing. And we have to address that. That comes from regulation changes, it comes from structuring of new products, it comes from education and it comes from this knowledge transmission where clients in the wealth segment can understand the role of alternatives and the context of what can do as they invest in equities and fixed income too. And we think that’s a big shortfall. So, the journey today, just to give you a sense, as we look at her clients in Europe on the wealth side, on average, as you look from what we would call the credited investors all the way through to more ultra-high-net worth individuals, their allocation to alternatives, we believe, stands at around two to three percent of their total portfolio. In the U.S., we believe it stands at three to five. So, most of those intermediaries, we speak to our partners who were more supporting and serving the wealth channel. They have certainly an ambition to help their clients grow that to 20 percent and potentially beyond that. So, when I look at that gap of let’s call it two to three to 20 percent in a market that just given the explosion in wealth around the world, I think the last numbers I saw, this is a $65 trillion market. RITHOLTZ: Wow. CONWAY: That speaks to the shortfall relative to the ambition. And how’s it been going? We have a number of things and capabilities we’ve set up to allow for this market to experience, hopefully, private equity, hedge funds, credit, and an infrastructure in ways they haven’t in the past. We’ve done this in the U.S., we’re doing it now in Europe, but I will say, Barry, this is still very much at the start of the journey. Wealth is a really important part of our future given our business, quite, frankly is 90 plus percent institutional today, but we’re looking to change that by, hopefully, democratizing these asset classes and making it so much more accessible in that of the past. RITHOLTZ: So, we hinted at this before but I’m going to ask the question outright, how significant is interest rates to client’s risk appetites, how much of the current low rate environment are driving people to move chunks of their assets from fixed income to alternatives? CONWAY: It’s really significant, Barry. I think the transition of these portfolios is quite profound, So you – and I think the unfortunate thing in some respects as this transition happens that you’re introducing new variables and new risks. The reason I say it’s unfortunate and that I think as an industry, this goes back to the education around the assets you own, understanding the role, understanding the various outcomes. I think it’s so incredibly important and that this the time where complete transparency is needed. And quite frankly, we’re investing capital that’s not ours. As an industry, we’re investing our client’s assets and they need to know exactly the underlying investments. And in good and bad times, how would those assets behave? So certainly, interest rates are driving a flow of capital away from these traditional assets, fixed-income, and absolutely in towards real estate, infrastructure, private creditors, et cetera, in the pursuit of this – this yield. But I do – I do think one of the things that’s critically important for the institutional channel, not just the wealth which are newer entrants is this transmission of education, of data because that’s how I think you build a better balanced portfolio and that’s a – that’s a real conundrum, I think, that the industry is facing and certainly your clients too. RITHOLTZ: Quite interesting. So let’s talk a little bit about the differences between investing in the private side versus the public markets, the most obvious one has to be the illiquidity. When you buy stocks or bonds, you get a print every microsecond, every tick, but most of these investments are only marked quarterly or annually, what does this illiquidity do when you’re interacting with clients? How do you – how do you discuss this with them in and how do perceive some of the challenges of illiquid investments? CONWAY: Over the – over the past number of decades, I think our clients have largely held too much liquidity in their portfolios. Like, so what we are finding is the ability to take on illiquidity risk. And obviously, in pursuit of that premium above, the traditional markets, I mean, I think the sentiment they are is it an absolute right one. That transition towards private market exposure, we think is an important one just given the return objectives, the majority of our clients’ need but then also again, most importantly now, with geo policy, with uncertainty, with interest rate uncertainty, inflation uncertainty, I mean, the – going back to the resilience point, the characteristics now by introducing these assets into the mix is important. And I think that’s – that point is maybe what I’ll expand on. As were talking to clients, using the Aladdin systems, and as you know, we bought eFront technologies, albeit a couple of years ago, by allowing, I think, great data and technology to help our clients understand these assets and the context of how they should own them relative to other liquidity needs, their risk tolerances, and the return expectations are really trying to use tech and data to provide a better understanding and comprehension of the outcomes. And as we continue to introduce these concepts and these approaches, by the way, that there is, as you know, so used to in the traditional side, it – it gives them more comfort around what they should and can expect. And that, to me, is a really important part of what we’re doing. So, we’ve released recently new technology to the wealth sector because, quite frankly, we mentioned it before, the 60-40 portfolio is a thing of the past. And that introduction of about 20 percent into alternatives, we applaud our partners who are – who are suggesting that to their clients. We think it’s something they have to do. What we’re doing to support that is really bringing thought leadership, education, but also portfolio construction techniques and data to bear in that conversation. And this goes back to – it’s no longer an alternative, right? This is a core allocation so the comprehension of what it is you own, the behavior of the asset in good and bad times is so necessary. And that’s become a very big thing with regard to our activities, Barry, because your clients are looking to understand better when you’re talking about assets that are very complex in their nature. RITHOLTZ: So, 60-40 is now 50-30-20, something along those lines? CONWAY: Yes. RITHOLTZ: Really, really intriguing. So, what are clients really looking for these days? We talked about yield. Are they also looking for downside protection on the equity side or inflation hedges you hinted at? How broad are the demands of clients in the alternative space? CONWAY: Yes. It ranges the gamut. And even – we didn’t speak to even hedge funds, we’ve had differing levels of interest in the hedge fund world for years and I, quite frankly, think some degree of disappointment too, Barry, with regard to the alpha, the returns that were produced relevant to the cost. RITHOLTZ: It’s a tough space to say the very least exactly. CONWAY: Exactly right. But when you start to see volatility introducing itself, you can really see where skill plays a critical factor. So, we are absolutely seeing, in the hedge fund, a resurgence of interest and demand by virtue of those who really have honed in on their scale, who have demonstrated an up-and-down markets and ability to protect and preserve capital, but importantly, in a low uncorrelated way build attractive risk-adjusted returns. We’re starting to see more activity there again too. I think with an alternatives, you’ve really seen a predominant demand coming from privates. These private markets, like a set of growths so extraordinarily fast and the opportunities that is rich, the reality too on the public side which is where our hedge funds operate, they continue to, in large part, do a really good job. The issue with our industry now with these 38,000 managers is how do you distill all the information? How do you think about your needs as a client and pick a manager who can deliver the outcomes? And just to give you a sense, the difference now between a top-performing private equity manager, a top quartile versus the bottom quartile, the difference can be measured in tens of percent. RITHOLTZ: Wow. CONWAY: Whereas if you look at the public equity side, for example, a large cap manager, top quartile versus bottom quartile is measured in hundreds of basis points. So, there is definitely a world that has started where the outcomes our clients will experience can be great as they pursue yield, as they pursue diversification, inflation protection, et cetera. I think the caveat that I would say is outcomes can vary greatly. So manager underwriting and the importance of it now, I think, really is this something to pay attention to because if you do have that bottom performing at the bottom quartile manager, it will affect your outcomes, obviously. And that’s what we collectively have to face. RITHOLTZ: So, let’s talk a little bit about real estate. There are a couple of different areas of investment on the private side. Rent to own was a very large one and we’ve seen some lesser by the flip algo-driven approaches. Tell us what Blackrock is doing in the real estate space and how many different approaches are you bringing to bear on this? CONWAY: Yes, we think it’s both equity and debt. Again, no different to the infrastructure side, these projects need to be financed. But on the – as you think about the sectors in which you can avail of the opportunity, you’ve no doubt heard a lot and I mentioned earlier this demand for logistics facilities. The explosion of shopping online and having, until we obviously have the supply chain disruption, an ability to have nearly immediate satisfaction because the delivery of the good to your home has become so readily available. It’s a very different consumer experience. So the explosion and the need for logistics facilities to support this type of behavior of the consumer is really an area that will continue to be of great interest too. And then you think about the transformation of business and you think about the aging world. Unfortunately, you can look at various economies where our populations are decreasing. And quite frankly, we’re getting older. And so, were you’re thinking of the context of that senior living facilities, it becomes a really important part, not just as part of the healthcare solution that come with it, but also from living as well. So, single-family, multifamily, opportunities continue to be something that the world looks at because there is really the shortfall of available properties for people to live in. And as the communities evolve to support the growing age of the population, tremendous opportunity there too. But we won’t give up on office space. It really isn’t going away. Now, if you even think about our younger generation here in BlackRock, they love being in New York, they love being in London, they love being in Hong Kong. So, the shape and the footprint may change slightly. But the necessity to be in the major financial centers, it still exists. But how we weighed the risks has definitely changed, certainly, for the – for the short-term and medium-term future. But real estate continues to be, Barry, a critical part of how we express our thought around the investment opportunity set. But clients largely do this themselves too. The direct investing from the clients is quite significant because they too see this as still as a rich investment ground, albeit, one that has changed quite a bit as a result of COVID. RITHOLTZ: Well, I’m fascinated by the real estate issue especially having seen some massive construction take place in cities pre-pandemic, look over in Manhattan at Hudson Yards and look at what’s taking place in London, not just the center of London but all – but all around it and I’m forced to admit the future is going to look somewhat different than the past with some hybrid combination of collaborative work in the office and remote work from home when it’s convenient, that sort of suggests that we now have an excess of capacity in office space. Do you see it that way or is this just something that we’re going to grow into and just the nature of working in offices is changing but offices are not going away? CONWAY: Yes. I do think there’s – it’s a very valid point and that in certain cities, you will see access, in others we just don’t, Barry. And quite frankly, as a firm, too, as you know, we have adopted flexibility with our teams that were very fortunate. The technologies in which we created at BlackRock has just become such an amazing enabler, not just to help us as we mention manage the portfolios, help us a better portfolio construction, understand risks, but also to communicate with our clients. I think we’ve all witnessed and experienced a way to have connectivity that allows them to believe that commerce can exist beyond the boundaries of one building. However, I do look at our property portfolios and even the things that we’re doing. Rent collections still being extraordinarily high, occupancy now getting back up to pre-pandemic levels, not in all cities, but in many of the major ones that have reopened. And certainly, the demand for people to just socialize, that the demand for human connectivity is really high. It’s palpable, right? We see it here too. The smiles on people’s faces, they’re back in the office, conversing together, innovating together. When people were feeling unsafe, unquestionably, I think the question marks around the role of office space was really brought to bear. But as were coming through this, as you’ve seen vaccine rates change, as you’ve seen the infection rates fall, as you’ve seen confidence grow, the return to work is really happening and return to work to office work is really happening, albeit, now with degrees of flexibility. So, going back to the – I do believe in certain areas. You’re seeing a surplus. But in many areas you’re absolutely seeing a deficit and the reason I say that, Barry, is we are seeing occupancy in certain building at such a high level. And frankly, the demand for more space being so high, it’s uneven and this goes back to then where do you invest our client’s capital, making sense of those trends, predicting where you will see resilience versus stress and building that into the portfolio of consequences as you – as you better risk manage and mitigate. RITHOLTZ: Very interesting. And so, we are seeing this transition across a lot of different segments of investing, are you seeing any products that were or – or investing styles that was once thought of as primarily institutional that are sort of working their way towards the retail side of things? Meaning going from institutional to accredited to mom-and-pop investors? CONWAY: Well, certainly, in the past, private equity was really an asset class for institutional investors. And I think that’s – that has changed in a very profound way. I mentioned earlier are the regulation has become a more adaptive, but we also have heard, in many respects, in providing this access. And I think the perception of owning and be part of this illiquid investment opportunity set was hard to stomach because many didn’t understand the attributes and what it could bring and I think we’ve been trying to solve for that and what you’re seeing now with – with regulators, understanding that the difference between if we take it quite simply as DD versus DC, the differences between the options you as a participant in a retirement plan are so vastly different that – and I think there’s a broad recognition now that there needs to be more equity with regard to what happens there. And private equity been a really established part of the alternatives marketplace was once, I think, really believed to be an institutional asset class, but albeit now has become much more accessible to wealth. We’ve seen it by structuring activities in Europe working with the regulators. Now, we’re able to provide private equity exposure to clients across the continent and really getting access to what was historically very much an institutional asset class. And I do think the receptivity is extraordinarily high just throughout people’s careers, they have seen wealth been created as a result of engineering a great outcome with great management teams integrate business. And I do believe the receptivity towards private equity is high as an example. In the U.S., too, working with the various intermediaries and being able to wrap now private equity in a ’40 Act fund, for example, is possible. And by being able to deliver that to the many as opposed to the few, we think has been a very good success story. And I think, obviously, appreciated by our clients as well. So, I would look at that were seeing across private equity as well as private credit and quite frankly infrastructure accuracy. You’re seeing now regulation that’s becoming more appreciative of these asset classes, you’re seeing a more – a greater level of openness and willingness to allow for these assets to be part of many people’s experiences across their investment portfolio. And now, with innovation around structures, as an industry, were able to wrap these investments in a way that our clients can really access them. So, think across the board, it probably speaks the innovation that’s happening but I do think that accessibility has changed in a very significant way. But you’ve really seen it happen in private equity first and now that’s expanding across these various other asset classes. RITHOLTZ: Quite intriguing. I know I only have you for a relatively limited period of time, so let’s jump to our favorite questions that we ask all of our guests. Starting with tell us what you’ve been streaming these days. Give us your favorite Netflix or Amazon Prime shows. CONWAY: That is an interesting question, Barry. I don’t a hell of a lot of TV, I got to tell you. I am – I keep busy with three wonderful children and a beautiful wife and between the sports activities. When I do watch TV, I have to tell you I’m addicted to sports and having – I may have mentioned earlier, growing up playing rugby which is not the most common sport in the U.S., I stream nonstop the Six Nations that happens in Europe where Ireland is one of those six nations that compete against each other on an annual basis. Right now, they’re playing a lot of sites that are touring for the southern hemisphere. And to me, the free times I have is either enjoying golf or really enjoying rugby because I think it’s an extraordinary sport. Obviously, very physical, but very enjoyable to watch. And that, that truly is my passion outside of family. RITHOLTZ: Interesting stuff. Tell us a bit about your mentors, who helped to shape your early career? CONWAY: Well, it even goes back to some of the aspects of sports. Playing on a team and being on a field where you’re working together, there’s a strategy involved with that. Now, I used to really appreciate how we approach playing in the All-Ireland League. How we thought about our opponents, how we thought about the structure, how we thought about each individual with on the rugby field and the team having a role. They’re all different but your role. And actually, even starting from an early age, Barry, thinking about, I don’t know, it’s sports but how to build a great team with those various skills, perspective, that can be a really, really powerful combination when done well. And certainly, from an early age, that allowed me to appreciate that – actually, in the work environment, it’s not too different. You surround yourself with just really great people that have high integrity that are empathetic and have a degree of humility that when working together, good things can happen. And I will say, it really started at sports. But I think of today and even in BlackRock, how Larry Fink thinks about the world and I think Larry, truly, is a visionary. And then Rob Kapito who really helps lead the charge across our various businesses. Speaking and conversing with them on a daily basis, getting their perspectives, trying to get inside your head and thinking about the world from their vantage point. To me, it’s a huge thing about my ongoing personal career and development and I really enjoy those moments because I think what you recognize is independent of how much you think you know, there’s so much more to know. And this journey is an ever evolving one where you have to appreciate that you’ll never know everything and you need to be a student every single day. So, I’d probably cite those, Barry, as certainly the two most important mentors in my life today, professionally and personally quite frankly. RITHOLTZ: Really. Very interesting. Let’s talk about what you’re reading these days. Tell us about some of your favorite books and what you’re reading currently? CONWAY: Barry, what I love to read, I love to read history, believe it or not. From a very small country that seems to have exported many, many people, love to understand the history of Ireland. So, there’s so many books. And having three children that have been born in the U.S. and my wife is a New Yorker, trying to help them understand some of their history and what made them what they are. I love delving into Irish history and how the country had moments of greatness and moments of tremendous struggle. Outside of that, I really don’t enjoy science fiction or any of these books. I love reading, you name any paper and any magazine on a daily basis. Unfortunately, I wake at about 4:30, 5 o’clock every day. I spent my first two hours of the day just consuming as much information as possible. I enjoy it. But it’s all – it’s really investment-related magazines, not books. It’s every paper that you could possibly imagine, Barry, and I just – I have a great appreciation for certainly trying to be a student of the world because that’s what we’re operating in an I find it just a very interesting avenue to get an appreciation to for the, not just the opportunities, but the challenges we’re collectively facing as a society but also as a business. RITHOLTZ: I’m with you on that mass consumption of investing-related news. It sounds like you and I have the same a morning routine. Let’s talk about of what sort of advice you would give to a recent college graduate who was interested in a career of alternative investments? CONWAY: Well, the industry has – it’s just gone through such extraordinary growth and the difference, when I’ve started versus today, the career opportunity set has changed so much. And I think I try to remind anyone of our analysts who come into each one of our annual classes, right, as we bring in the new recruits. I think about how talented they are for us, Barry, and how privileged we all are to be in this industry and work for the clients that we do. It’s just such an honor to do that. But I kind of – I try to remind them of that. At the end of the day, whether you’re supporting an institution, that institution is the face of many people in the background and alternatives has really now become such an important part of their experience and we talked about earlier just this challenge of retirement, if we do a good job, these institutions that support the many, they can have, hopefully, a retirement that involves dignity and they can have an ability to do things they so wanted to do as they work so hard over their lives. Getting that that personal connection and allowing for those newbies to understand that that’s the effect that you can have, an alternatives whether it’s private equity, real estate, infrastructure, private credit, hedge funds, all of these now, with the scale at which they’re operating at can allow for a great career. But my advice to them is always don’t forget your career is supporting other people. And that comes directly to how we intersect with wealth channel, it comes indirectly as a result of the institutions. And it’s such a privilege to do that. I didn’t envision when I grew up, as I mentioned, my first job, milking cows and back in a small town in the middle of Ireland that I would be one day leading an alternatives business within BlackRock. I see that as a great privilege. So, for those who are joining afresh, hopefully, try to remind them that it is for all of us and show up with empathy, dignity, compassion, and do the best you can, and hopefully, these people be sure will serve them well. RITHOLTZ: And our final question, what you know about the world of alternative investing today you wish you knew 25 years or so ago when you were first getting started? CONWAY: I think if we had invested much more heavily as an industry in technology, we would not be in the position we are today. And I say that, Barry, from a number of aspects. I mentioned in this shortfall of information our clients are dealing with today. They’re making choices to divest from one asset class to invest in another. To do that and do that effectively, they need great transparency, they needed real-time in many respects, it can’t be just a quarterly line basis. And if we had been better prepared as an industry to provide the technology and the data to help our clients really appreciate what it is they own, how we’re managing the assets on their behalf, I think they would be so much better served. I think we’re very fortunate at this firm to have built a business on the back of technology for albeit 30 plus years and were investing over $1 billion a year in technology as I’m sure you know. But we need to see more of that in the industry. So, the client experience is so important, stop, let’s demystify alternatives. It’s not that alternative. Let’s provide education and data and it’s become so large relative to other asset classes, the need to support, to educate, and transmit information, not data, information, so our client understand it, is at a paramount now. And I think it certainly as an industry, things have to change there. If I knew how big the growth would have been and how prominent these asset classes were becoming, I would oppose so much harder on that front 30 years ago. RITHOLTZ: Thank you, Edwin, for being so generous with your time. We’ve been speaking with Edwin Conway. He is the head of Blackrock Investor Alternatives Group. If you enjoy this conversation, please check out all of our prior discussions. You can find those at iTunes, Spotify, wherever you get your podcast at. We love your comments, feedback and suggestions. Write to us at MIB podcast@Bloomberg.net. You can sign up for my daily reads at ritholtz.com. Check out my weekly column at Bloomberg.com/opinion. Follow me on Twitter, @ritholtz. I would be remiss if I did not thank the crack team that helps put these conversations together each week. Mohammed ph is my audio engineer. Paris Wald is my producer, Michael Batnick is my head of research, Atika Valbrun is our project manager. I’m Barry Ritholtz, you’ve been listening to Masters in Business on Bloomberg Radio.   ~~~   The post Transcript: Edwin Conway appeared first on The Big Picture......»»

Category: blogSource: TheBigPictureNov 22nd, 2021

3 ways to cut $1 trillion in defense spending over the next decade

The CBO came up with three approaches to cutting about $1 trillion from the Pentagon budget over the next decade — a decrease of just 14%. An F-35A Combat Power Exercise at Hill Air Force Base in Utah, January 6, 2020.US Air Force/R. Nial Bradshaw Congress is moving to increase the Pentagon budget above the already astronomical level proposed by the Biden administration. But a new Congressional Budget Office report shows three ways to cut $1 trillion in defense spending over the next decade. Whether US leaders meet the challenges of today or continue to succumb to the power of the arms lobby is an open question. Even as Congress moves to increase the Pentagon budget well beyond the astronomical levels proposed by the Biden administration, a new report from the Congressional Budget Office (CBO) has outlined three different ways to cut $1 trillion in Department of Defense spending over the next decade.A rational defense policy could yield far more in the way of reductions, but resistance from the Pentagon, weapons contractors, and their many allies in Congress would be fierce.After all, in its consideration of the bill that authorizes such budget levels for next year, the Democratic-controlled House of Representatives recently voted to add $25 billion to the already staggering $750 billion the Biden administration requested for the Pentagon and related work on nuclear weapons at the Department of Energy.By any measure, that's an astonishing figure, given that the request itself was already far higher than spending at the peaks of the Korean and Vietnam wars or President Ronald Reagan's military buildup of the 1980s.In any reasonable world, such a military budget should be considered both unaffordable and deeply unsuitable when it comes to addressing the true threats to this country's "defense," including cyberattacks, pandemics, and the devastation already being wrought by climate change.Worst of all, providing a blank check to the military-industrial-congressional complex ensures the continued production of troubled weapon systems like Lockheed Martin's exorbitantly expensive F-35 Joint Strike Fighter, which is typically behind schedule, far above projected costs, and still not considered effective in combat.Changing course would mean real reform and genuine accountability, starting with serious cuts to a budget for which "bloated" is far too kind an adjective.Three options for reductionsUS Navy aircraft carriers USS Ronald Reagan, USS Theodore Roosevelt, and USS Nimitz in the western Pacific, November 12, 2017.ReutersAt the request of Senate Budget Committee Chair Bernie Sanders (I-VT), the CBO devised three different approaches to cutting approximately $1 trillion (a decrease of a mere 14%) from the Pentagon budget over the next decade.Historically, it could hardly be a more modest proposal. After all, without any such plan, the Pentagon budget actually did decrease by 30% between 1988 and 1997.Such a CBO-style reduction would still leave the department with about $6.3 trillion to spend over that 10-year period, 80% more than the cost of President Joe Biden's original $3.5 trillion Build Back Better proposal for domestic investments.Of course, that figure, unlike the Pentagon budget, has already been dramatically whittled down to half its original size, thanks to laughable claims by "moderate" Democrats like Senator Joe Manchin (D-WV) that it would break the bank in Washington. Yet such critics of expanded social and economic programs rarely offer similar thoughts when it comes to the Pentagon's far larger bite of the budgetary pie.The options in the budget watchdog's new report are anything but radical:Option one would preserve the "current post-Cold War strategy of deterring aggression through [the] threat of immediate U.S. military response with the objectives of denying an adversary's gains and recapturing lost territory." The proposed cuts would hit each military service equally, with some new weapons programs slowed down and a few, as in the case of the B-21 bomber, cancelled.Option two "adopts a Cold War-like strategy for large nuclear powers of making aggression very costly and recognizing that the size of conventional conflict would be limited by the threat of a nuclear response." That leaves nearly $2 trillion for the Pentagon's planned "modernization" of the US nuclear arsenal untouched, while relying more heavily on working with allies in conventional war situations than current strategy allows for. It would mean that the military might take longer to deploy in large numbers to a conflict.Option three "de-emphasizes use of U.S. military force in regional conflicts in favor of preserving U.S. control of the global commons (sea, air, space, and the Arctic), ensuring open access to the commons for allies and unimpeded global commerce." In other words, Afghan- or Iraq-style boots-on-the-ground US interventions would largely be avoided in favor of the use of long-range and "over-the-horizon" weapons like drones, naval blockades, the enforcement of no-fly zones, and the further arming and training of allies.But looking more broadly at the question of what will make the world a safer place in an era of pandemics, climate change, racial injustice, and economic inequality, reductions well beyond the $1 trillion figure embedded in the CBO's recommendations would be both necessary and possible in a more reasonable American world.The CBO's scenarios remain focused on military methods for solving security problems, assuring an all-too-narrow view of what might be saved by a new approach to security.Nuclear excessFour B-61 nuclear gravity bombs at Barksdale Air Force Base.United States Department of Defense SSGT Phil SchmittenThe CBO, for instance, chose not to look at possible savings from simply scaling back (not even ending) the Pentagon's $2-trillion, three-decades-long plan to build a new generation of nuclear-armed missiles, bombers, and submarines, complete with accompanying new warheads.Scaling back such a buildup, which will only further imperil this planet, could easily save in excess of $100 billion over the next decade.One significant step toward nuclear sanity would be to adopt the alternative nuclear posture proposed by the organization Global Zero. That would involve the elimination of all land-based nuclear missiles and rely instead on a smaller force of ballistic missile submarines and bombers as part of a "deterrence-only" strategy.Land-based, intercontinental ballistic missiles were accurately described by former Secretary of Defense William Perry as "some of the most dangerous weapons in the world."The reason: a president would have only a matter of minutes to decide whether to launch them upon being warned of an oncoming nuclear attack by an enemy power. That would, of course, greatly increase the risk of an accidental nuclear war and the potential destruction of the planet prompted by a false alarm (of which there have been several in the past).Eliminating such missiles would make the world a far safer place, while saving tens of billions of dollars in the process.Capping contractorsIsaac Brekken/Getty ImagesWhile most people think about the Pentagon budget in terms of what it spends on new guns, ships, planes, and missiles, services are about half of what it buys every year.These are the contracts that go to various corporate "Beltway bandits" to consult with the military or perform jobs that could often be done more cheaply by federal employees. Both the Defense Business Board and the Pentagon's own cost estimating office have identified service contracting as an area where there are significant opportunities for large-scale savings.Last year, the Pentagon spent nearly $204 billion on various service contracts. That's more than the budgets for the Departments of Health and Human Services, State, or Homeland Security. Reducing spending on contractors by even 15% would instantly save tens of billions of dollars annually.In the past, Congress and the Pentagon have shown that just such savings could easily be realized. For example, a provision in a 2011 defense law simply capped such spending at 2010 levels. Government spending data shows that, in the end, it was reduced by $42 billion over four years.Closing unneeded basesAn aircraft hangar damaged by Hurricane Michael at Tyndall Air Force Base in Florida, October 11, 2018.ReutersWhile the Biden administration seeks to expand domestic infrastructure spending, the Pentagon has been desperate to shed costly and unnecessary military facilities.Both the Obama and Trump administrations asked Congress to authorize another round of what's called base realignment and closure to help the Defense Department get rid of its excess capacity. The Pentagon estimates that it could save $2 billion annually that way.The CBO report cited above explicitly excludes any consideration of such cost savings as politically unfeasible, given the present Congress. But considering the ways in which climate change is going to threaten current military basing arrangements domestically and globally, that would be an obvious way to go.Another CBO report warns that the future effects of climate change — from rising sea levels (and flooding coastlines) to ever more powerful storms — will both reduce the government's revenue and increase its mandatory spending, if its base situation remains as it is now.After all, ever fiercer tropical storms and hurricanes, as well as rising levels of flooding, are already resulting in billions of dollars in damage to military bases. Meanwhile, it's estimated that, in the decades to come, more than 1,700 US military installations worldwide may be impacted by sea-level rise.Future rounds of base closings, both domestic and global, should be planned now with the impact of climate change in mind.Turning around Congress, fighting off lobbyistsThe House Armed Services Committee at the start of a hearing on the National Defense Authorization Act, September 1, 2021.Bill Clark/CQ-Roll Call, Inc via Getty ImagesSo far, boosting Pentagon spending has been one of the only things a bipartisan majority of this Congress can agree on, as indicated by that House decision to add $25 billion to the Pentagon budget request for Fiscal Year 2022. A similar measure is included in the Senate version, which it will debate soon.There are, however, glimmers of hope on the horizon as the number of members of Congress willing to oppose the longstanding practice of shoveling ever more funds at the Pentagon, no questions asked, is indeed growing.For example, a majority of Democrats and members of the leadership in the House of Representatives supported an ultimately unsuccessful provision to strip some excess funds from the Pentagon this year. A smaller group voted to cut the department's budget across the board by 10%. Still, it was a number that would have been unthinkable just a few years ago.That core group is only likely to grow in the years to come as the costs of non-military challenges like pandemics, climate change, and the financial impact of racial and economic injustice supplant traditional military risks as the most urgent threats to American lives and livelihoods.Opposition to increased Pentagon spending is growing outside of Washington as well. An ever wider range of not just progressive but conservative organizations now support substantial reductions in the Pentagon budget.President Donald Trump at the signing of the 2019 NDAA, authorizing $716 billion in defense spending.Carolyn Kaster/APThe challenge, however, is to translate such sentiments into a concerted, multifaceted campaign of public pressure that will move a majority of the members of Congress to stop giving the Pentagon a yearly blank check. A new poll from the Eurasia Group Foundation found that twice as many Americans now support cutting the Pentagon budget as support increasing it.Any attempt to curb Pentagon spending will run up against a strikingly powerful arms industry that deploys campaign contributions, lobbyists, and promises of defense-related employment to keep budgets high. In this century alone, the Pentagon has spent more than $14 trillion, up to one half of which has gone to contractors.During those same years, the arms industry has spent $285 million on campaign contributions and $2.5 billion on lobbying, most of it focused on members of the armed services and defense appropriations committees that take the lead in deciding how much the country spends for military purposes.The arms industry's lobbying efforts are especially insidious. In an average year, it employs around 700 lobbyists, more than one for every member of Congress. The top five corporate weapons makers got a return of $1,909 in taxpayer funds for every dollar they spent on lobbying. Most of their lobbyists once worked in the Pentagon or Congress and arrived in the world of arms contractors via the infamous "revolving door."Of course, they then used their relationships with their former colleagues in government to curry favor for their corporate employers. A 2018 investigation by the Project On Government Oversight found that, in the prior decade, 380 high-ranking Pentagon officials and military officers had become lobbyists, board members, executives, or consultants for weapons contractors within two years of leaving their government jobs.Lloyd Austin at a ceremonial swearing-in at the White House, January 25, 2021. Austin joined the board of Raytheon after retiring from the military.Doug Mills-Pool/Getty ImagesA September 2021 study by the Government Accountability Office found that, as of 2019, the top 14 arms contractors employed more than 1,700 former military or Pentagon civilian employees, including many who had previously been involved in making or enforcing the rules for buying major weapons systems.The revolving door spins both ways, with executives and board members of the major weapons makers moving into powerful senior positions in government where they're well situated to help their former (and, more than likely, future) employers.The process starts at the top. Four of the past five secretaries of defense have also been executives, lobbyists, or board members of Raytheon, Boeing, or General Dynamics, three of the top five weapons makers that split tens of billions of dollars in Pentagon contracts annually.Both the House and Senate versions of the 2022 National Defense Authorization Act extend the periods of time in which those entering the government from such industries have to recuse themselves from decisions involving their former companies. Still, as long as the Pentagon continues to pluck officials from the very outfits driving those exploding budgets, we should all know more or less what to expect.So far, the system is working — if you happen to be an arms contractor. The top five weapons companies alone split $166 billion in Pentagon contracts in Fiscal Year 2020, well over one-third of those issued by the Department of Defense that year.To give you some sense of the scale of all this — and our government's twisted priorities — Lockheed Martin alone received $75 billion in Pentagon contracts in Fiscal Year 2020, nearly one and one-half times the $52.5 billion allocated for the State Department and the Agency for International Development combined.Which way forward?More than 1,000 pieces of US Army equipment and vehicles at the port in Gdansk, Poland, September 14, 2017.US Army/Sgt. 1st Class Jacob A. McDonaldThe Congressional Budget Office's new report charts a path toward a more rational approach to Pentagon spending, but the $1 trillion in savings it proposes should only be a starting point.Hundreds of billions more could be saved over the next decade by reassessing our national security strategy, cutting back the Pentagon's nuclear buildup, capping its use of private contractors, and scaling back the colossal sums of waste, fraud, and abuse baked into its budget.All of this could be done while making this country and the world a significantly safer place by shifting such funds to addressing the non-military risks that threaten the future of humanity.Whether our leaders meet the challenges of today or continue to succumb to the power of the arms lobby is an open question.Mandy Smithberger, a TomDispatch regular, is the director of the Center for Defense Information at the Project On Government Oversight (POGO).William D. Hartung, a TomDispatch regular, is the director of the Arms and Security Program at the Center for International Policy and the author of "Profits of War: Corporate Beneficiaries of the Post-9/11 Surge in Pentagon Spending" (Brown University's the Costs of War Project and the Center for International Policy, September 2021).Read the original article on Business Insider.....»»

Category: topSource: businessinsiderNov 19th, 2021

The 15 essentials you should pack while traveling during a pandemic this holiday season

Stay safe this holiday season with these travel essentials that help you minimize exposure to COVID-19 and stay safe and healthy while on the road. When you buy through our links, Insider may earn an affiliate commission. Learn more.Hispanolistic/Getty Images Holiday travel is safer in 2021 than in 2020 but you should still take precautions to minimize the spread of COVID-19. The best precautions for traveling are getting vaccinated and wearing a mask in public spaces. Additional items like at-home COVID tests and portable hand sanitizer can also help you travel safer. Medical review by: David Aronoff, MD, director of the Division of Infectious Diseases at the Vanderbilt University Medical Center. Table of Contents: Masthead StickyWith rising vaccination rates in the U.S. and around the world, travel is reopening further. Americans are cleared to travel within the U.S. and, if fully-vaccinated, many places abroad, according to the Centers for Disease Control and Prevention (CDC).However, traveling isn't the same as pre-pandemic or even the same as mid-pandemic: Whether or not you're vaccinated, you need to take precautions when flying or driving. Everyone must wear a mask over their nose and mouth on planes, buses, trains, taxis, and other forms of public transportation.Most countries have other specific rules to visit, including proof of vaccination and certification that you've had a recent negative COVID test. Many experts also recommend taking a COVID test before and after you travel regardless of if it's required.While it's relatively safe to travel, that's only true if you take proper precautions. We've talked to three experts about everything you need to know to travel safely in the fall and winter of 2021, whether you're flying or driving, vaccinated or not.Here are the new essentials everyone should pack before traveling:Vaccine passport: CommonPassN95 mask: Kimberly-Clark N95 RespiratorKN95 mask: Powecom KN95 masks, 10 packDisposable mask: DemeTech DemeMask Surgical MaskFabric face masks: Herschel Classic Fitted Face MaskFace masks with removable filter: Halo Life Nanofilter MaskFace masks for kids: Onzie Mindful Masks (2-Pack)At-home COVID test: EmpowerDX At-Home COVID-19 PCR TestPortable hand sanitizer: Touchland Power Mist Sanitizer SprayTravel-sized disinfectant wipes: Clorox Disinfectant Wipes To GoA smartphone sanitizer: PhoneSoap 3 Smartphone UV SanitizerPacking cubes: eBags Hyperlite Packing CubesTape to help your face mask fit better: Cabeau TapeA mask bracket for added comfort: HeartFormSF Mask BracketReusable bags for safety gear: Stasher Reusable Silicone BagWhat to consider before you goEmilija Manevska/Getty ImagesVaccination against the SARS-CoV-2 virus is the most important and effective way we can reduce the spread and severity of COVID-19, David Aronoff, MD, director of the Division of Infectious Diseases at the Vanderbilt University Medical Center, told Insider during his medical review of this piece."While masks, reduced crowding, and social distancing are among the many things we can do to reduce the spread of COVID-19, vaccination has been shown to protect against getting infected, reduce the risk of symptoms or severe disease, and prevent death," he said.Be sure that anyone in your traveling party (or meeting you at your destination) is vaccinated if they are eligible, and that they've received their booster vaccine doses, which is now available for most people who've already been immunized.Additionally, all travelers should ask themselves before they go: Can I afford to be trapped somewhere if I or one of my travel companions gets COVID and can't travel home? "If the answer is no, stay home," Dr. Aronoff added.If you are traveling, Dr. Aronoff encourages checking your health insurance carefully to find out where and how to seek medical attention if you need it and exactly what your policy covers. Some countries require proof of travel health insurance that covers COVID to enter their borders. Dr. Aronoff also suggested having a plan for where you'd go to get care if you got sick and how you'd quarantine from the people you're visiting.What should be in your travel safety kitImages By Tang Ming Tung/Getty ImagesWhether you're vaccinated or not, driving or flying, remember the basics of COVID travel: Wear the best mask you can (ideally an N95-type mask), making sure it fits snuggly without gaps at the sides (layering two masks can help), and keep your distance from people outside your household as much as possible.Then, pack a portable COVID-19 safety kit, whether flying or driving.Proof of vaccinationAgain, getting the COVID vaccine is the best thing you can do to stay safe and keep other safe while traveling during the pandemic. Many countries require proof of vaccination before entering their borders, and even if you're traveling domestically, it's a good idea to have proof with you just in case a public space or business upon arrival requires it.If you want to travel with your physical vaccine card, we suggest putting it in a protective vinyl casing. But there are also a handful of apps, such as CommonPass and VeriFLY, that allow you to upload proof of vaccine and even connect PCR test results so you have proof of your low-risk all in one place.Card Protector Vinyl Sleeve (small)App (small)App (small)Masks for adultsMasks are required on all airlines, regardless of your vaccination status or where you're flying. They're also recommended for any public place while driving, like public restrooms or service stations.As coronavirus is an airborne virus, wearing a mask is still one of the key ways to reduce spreading or getting COVID, especially in an indoor, crowded place like an airport or airplane, Joyce Sanchez, MD, medical director of the Travel Health Clinic at Froedtert and the Medical College of Wisconsin tells Insider.Wearing the right mask the right way helps to protect not only the people around you but the wearer too.Nearly everyone can safely wear a mask, other than those who can't put on or take off a mask themselves. This includes those with chronic lung and heart problems, Dr. Sanchez says. "Even if it feels harder to breathe while wearing a mask, it doesn't actually affect how much oxygen your body gets," she assures.Why are masks so important? Think of the COVID virus like cigarette smoke spreading indoors — it flows throughout the space (beyond 6 feet from the person who exhaled it and around plexiglass barriers) and can hang in the air for hours, even after the person is no longer in the room.Considering its spreadability, and given how contagious the Delta variant is, it's more important than ever to wear a well-fitting mask to both prevent spreading the virus to others and inhaling it yourself.Quick tip: If your mask tends to suction to your mouth when you breathe in, look for a mask with a more structured frame that keeps the fabric away from your lips (like a KN95 mask). Or, insert a frame, like one from HeartFormSF, into a covering you already have.N95-type masks are best now that they're no longer in short supply like early in the pandemic, followed by KN95 masks (both technically called respirators rather than masks). Both seal the sides of the face and top of the nose to minimize any gaps where air can leak, and offer additional filtration of air as you breathe, Dr. Sanchez explains.However, counterfeits are common, so check the CDC's list of approved masks and suppliers. A quick way to tell is that real N95s have straps around the back of the head instead of ear loops and a TC number (e.g., 84A-XXX for U.S.-approved N95s).After N95s and KN95s, a three-layer cloth mask is your next best option. The outside two layers should be a tightly-woven fabric like cotton or linen and the middle a filter fabric, either built-in or added-in by you (a folded paper towel works great).It's important that your mask fits snugly to trap the potentially-infected air particles rather than leaking through the edges of the mask and being directly inhaled, Abe Malkin, MD, MBA, the founder and medical director of Concierge MD LA, tells Insider. Make sure there are no gaps around the edges of your mask — a detail of equal importance regardless of if you're vaccinated or not.Quick tip: If a mask causes your glasses or sunglasses to fog up, that's a sign it doesn't fit properly and is allowing potentially virus-laden air in and out. Use a special tape like Cabeau Tape between the fabric and your skin where there's a gap to create a better seal.If your mask has gaps on the top or sides or if you only have a single-ply mask, it's smart to double up with a disposable surgical-type mask underneath and a tighter cloth mask over top. And if your mask slips down under your nose as you talk, it's a sure sign you need a better-fitting mask.Quick tip: Pack multiple masks. When you travel, you should have enough coverings to wear a fresh mask each day, as well as extras on hand if it gets dirty or wet.It's also important to wash reusable masks daily — a clean-looking mask can be covered with germs, which can spread to your hands and everything you touch every time you take it off or put it on. Wash it as you do your hands, with a minimum 20-second scrub with soapy water and a thorough rinse, then hang it to dry.Skip the neck gaiters and bandanas — early reports that they're worse than no mask at all were likely overblown, but researchers do know real masks are more effective. Plus, many airlines don't allow them anyway.N95 Respirator (small)KN95 Masks (10 Pack) (small)DemeMask Surgical Mask, 50 pack (small)Classic Fitted Face Mask (small)Nanofilter Mask (small)Mask Bracket (5-Count) (small)Tape (small)Masks for kidsA well-fitting mask is the most important factor for anyone, so children should use masks made for kids, Dr. Malkin says, adding "adult masks are too big for them."If kids can help choose their own supplies, it increases the chance they'll use them. Dr. Malkin advises opting for a mask with a character or designs your child likes to increase the chance that they'll keep it on when you're not looking.Mindful Masks (2-Pack) (small)Mickey Mouse masks, 4-pack (small)Smurfs Original Blue Cloth Face Mask (small)Masks are generally required on planes for kids 5 and older, though sometimes it's 2 or older (check your airline's requirements before you go). And Dr. Aranoff advises all kids over 2 years old should wear one in indoor, public places unless they physically can't. The CDC does not recommend masks for children under 2.Kids need multiple masks just like adults, so stash a few extras in their backpacks and in the car, Jagdish Khubchandani, PhD, a professor of public health at New Mexico State University tells Insider.Quick tip: It's super important to model safe practices, Dr. Sanchez says. "If you're wearing a mask, disinfecting your hands, maintaining that distance, and reinforcing those behaviors through what you say and do — children pick up on and mirror that."At-home COVID-19 testMost countries require you to have proof of a negative COVID test to enter. Taking one is a good idea even if you're traveling domestically, especially if you're unvaccinated, the CDC advises.Even if your destination doesn't require it and even if you're vaccinated, it's wise to get a COVID test both before you travel and after you arrive to minimize the chance of spreading the virus to vulnerable people. "If you are planning on visiting others, make sure to get tested to ensure everyone's safety," Dr. Malkin adds.For international or domestic travel, the CDC recommends that people who aren't vaccinated take a COVID test one to three days before you leave, keep your distance from others as much as possible while traveling, and once you return home, take another viral test and self-isolate for a full seven days. If you don't get a viral test, you should isolate for 10 days. Either way, avoid being around high-risk folks for 14 days.As for where to get a COVID test, many towns have free testing sites. But you can also snag an at-home rapid antigen test or, slightly less common, more accurate molecular tests (such as a PCR test). Just remember, the tests aren't 100% foolproof.Many at-home tests require you to mail in a nasal swab or spit tube to be processed in a lab. But newer tests (both antigen and molecular) available in some countries let you get your results online in as little as 45 minutes, with some antigen tests delivering results right in front of you, within 15 minutes. (Just be sore to follow the instructions closely and the tests can give a false negative.)Most tests that are supervised by a health professional over video provide you with the certification you need for flights. Just make sure you know the precise time window to do your test and get the certification back before your flight.When our team researched and tested the leading at-home COVID tests on the market throughout 2021, we found EmpowerDX Nasal to be the most accurate, covered by most insurance or the cheapest test available out of pocket and turns results around within two days of the lab receiving the sample. Dr. Sanchez also recommends the Abbott at-home antigen test kit, which offers six tests for $150.Dr. Sanchez recommends each person bring at least two approved at-home test kits that meet the testing requirements when traveling internationally in case there's a problem with one or you need to re-test. "You do not want to be stuck or delayed in returning home because you have not prepared for that required step," she adds.At-Home Covid-19 Nasal PCR Test (small)BinaxNOW COVID-19 At-Home Test Kit - 6 Pack (small)Hand soap, sanitizer, and wipesTraveling exposes you to tons of germs — viruses, bacteria, protozoa, and fungi — outside of COVID that can cause illnesses. It's super important to clean your hands before and after you eat, in particular. The best way: Wash your hands with soap and water for at least 20 seconds and then dry them thoroughly with a paper or cloth towel (rather than an air blower).But since that's not always possible, the second-best option is to use hand sanitizer. Always pack one with at least 60% alcohol in your carry-on, and rub it all over your hands, even the nooks and crannies, until it evaporates.Antibacterial hand wipes are less ideal since they sometimes contain harmful chemicals and may contribute to antibiotic resistance. But in a pinch, they're definitely better than having unclean hands. Keep in mind that most wipes are formulated for objects and not for skin, Dr. Malkin points out. As with hand sanitizer, the formula needs to be at least 60% alcohol to kill viruses.Power Mist Moisturizing Hand Sanitizer (small)Antibacterial Aloe Wipes (small)Disinfectant wipesKeeping high-touch surfaces clean is important, but don't obsess over disinfecting every surface you come into contact with, Dr. Sanchez told us — you're not at all likely to acquire COVID by touching an infected surface. This is especially true when driving; there's no need to wipe down your car handles or steering wheel, for example.That being said, high-touch surfaces on planes — armrests, tray tables, in-flight entertainment screens — can transmit germs, so it's wise to wipe down surfaces around your seat with a disinfectant wipe.Be sure to clean your phone too — you might be surprised by how dirty it actually is. Follow the manufacturer's instructions for how to clean it and try to use it only with clean hands. (But be careful: Some cleaners can ruin your screen.)Disinfectant Wipes On the Go (small)HomeSoap UV Sanitizer (small)Storage bagsWhen flying, carry-on storage is essential to make it easy to access hand sanitizer and other essential items. Ideally, your carry-on bag has multiple pockets so you can keep things like food and extra masks separate from dirty items. You can also use a small pouch to keep these essentials right on top (we like these durable, zippered pouches from Baboon to the Moon).We also recommend having a few plastic bags available to store dirty masks, in addition to things like used disinfectant wipes or tissues until you can find a trash can. You'll want one for your car and in your carry-on.It's also helpful to have a designated clean storage bag where you can put your mask when you take it off to eat away from dirty surfaces or other people's breath, Dr. Sanchez advises. Avoid placing your mask on a table or your arm to minimize germ contamination.Reusable Silicone Sandwich Bag (small)Dopp Kit (small)What you should leave at homeGlovesYou don't need to bring gloves with you traveling. First of all, COVID-19 is transmitted by breathing, not by touching things and then touching your face. Regardless, germs can live on the surface of a latex glove, the same as skin, Dr. Malkin says. Plus, "some people become too relaxed when they are wearing gloves. They do not realize they are at more risk for spreading [germs] because they are touching multiple personal items in between other things," he adds.Studies have suggested that people who wear gloves tend not to wash their hands as often or notice when gloves get dirty or damaged. It's also easy to contaminate your hands when removing gloves. Plus, we don't need any more COVID-19 waste than we already have.Face shieldsHow important are face shields? "As we do not have data to support the use of face shields in protecting individuals from acquiring COVID-19 in the community setting, they should not be used as a substitute for a well-fitting mask," Dr. Sanchez says.She added that while she saw no downside to adding a face shield to your travel safety kit, "they are not an equivalent substitute for face masks." They might provide protection if someone sneezes in your direction, for example, but they don't protect others from any virus you may be carrying.Is it safer to fly or drive?RuslanDashinsky/Getty ImagesIf you do need to travel, driving is generally safer than flying commercially, Dr. Sanchez says. If you drive, you have control over who shares the car with you, where you stop along the way, and when you return.If you're fully vaccinated and wearing a well-fitting mask, it's generally safe to fly from a COVID-19 transmission standpoint, she adds.Just keep in mind that you're most likely to transmit or catch the coronavirus when in close proximity to an infected person, especially in situations where people aren't wearing masks at all or wearing them properly. That means airport lines are an issue (sitting on the plane much less so, as we'll explain below), as is driving with anyone not already in your household bubble. Eating indoors — since people have no choice but to remove their masks — is high risk.Regardless of your mode of transportation, it's important to be diligent with precautions.Your driving safety planRealPeopleGroup/Getty ImagesRemember that COVID is spread by people breathing and talking, not by touching surfaces. If you're driving, you don't need to wipe down your steering wheel. But it can bring peace of mind to clean your hands before getting in; have hand sanitizer at the ready before and after you eat, and for after you use a gas pump and public restroom, for example.Power Mist Moisturizing Hand Sanitizer (small)Choose restaurants where staff are diligent about wearing masks. Keep your mask on unless you're actively eating or drinking, and try to eat outdoors or in your car.Use public restrooms for bathroom breaks. Pulling over for a roadside bathroom break is actually illegal throughout the U.S. Just wear a mask and try to wait outside in a well-ventilated space for a free stall. If the toilet has a lid, close it to flush. (There's evidence that the coronavirus can spread by flushing.)Dr. Sanchez adds that you should assume public restrooms are not properly disinfected and that surfaces could be covered in many kinds of germs aside from COVID. Wash your hands with soap and water for at least 20 seconds and then use a paper towel to dry your hands and turn off the tap and open the door. If you do touch anything on your way out, use your 60%-plus alcohol hand sanitizer.Your airport safety plandmphoto/Getty ImagesAirports — especially with lines at security, boarding gates, and within the plane itself — are risky because of the close proximity to other people. Wear your mask at all times and keep as much distance from others as you can.When the TSA has you lower your mask for identity verification, touch it from the ear loops rather than the middle to avoid transferring any germs on the fabric onto your hands. It's wise to sanitize or wash your hands after you've touched security trays, not so much because of the coronavirus, but to protect yourself from other germs.As for the plane itself, airlines have stepped up their disinfecting regimens. Many use electrostatic foggers nightly — sometimes between every flight. They spray a fine mist of disinfectant throughout the plane, and the electrostatic charge causes it to stick to all surfaces, not just fall to the floor.Though COVID isn't transmitted by touching things, don't assume your flight has been freshly fogged with disinfectant. Planes can be filthy. It's still wise to wipe down everything in your seat area with a disinfecting wipe like Clorox Ultra Clean Disinfecting Wipes; many airlines now hand out disinfecting wipes as you board, too.If you bring your own, look for "disinfecting" and at least 60% alcohol on the label — a cleaning wipe rids your tray table of that splash of Coke, but it won't kill bacteria and viruses. Settle into your seat and wipe down everything you're likely to touch: the seat belt, armrests, the tray table, the air vent, the window-shade handle, and all places you need to touch to operate the entertainment system.Then, thoroughly clean your hands with sanitizer. The TSA increased the size limit for sanitizer during the pandemic, and until further notice, you're allowed to bring one bottle that's up to 12 ounces in your carry-on bag. If you're flying internationally, note that some countries maintain the 3-ounce limit.Disinfectant Wipes On the Go (small)Power Mist Moisturizing Hand Sanitizer (small)You might be worried about sitting in an enclosed space for hours, but the air on planes is cleaner than in many indoor places, and airlines' mandatory mask policies help protect everyone from virus particles that anyone could be breathing out. A September 2021 peer-reviewed, real-world study showed that the risk of contracting COVID-19 on a plane is 0.1% thanks to mask policies, requiring negative COVID tests to fly, and planes' hospital-grade air filtration systems.When a plane cruises, the cabin air refreshes every three to four minutes, using both fresh air from outside and air that's gone through HEPA filters that remove virtually all viruses.However, if you need to eat or drink on a plane, it's wise to wait a few minutes after the people around you have put their masks back on before you take yours off.Minimize moving around on the plane, including wrestling carry-on luggage in and out of the overhead bin. If you need to use the restroom, be sure to close the toilet lid before you flush. After washing your hands for 20 seconds and drying them, use a paper towel to unlock and open the door. Avoid touching seatbacks as you return to your own, both to keep your hands clean (headrests are the dirtiest surfaces inside an airplane cabin) and so you don't disturb other passengers.After your flight, it's smart to avoid crowds around the baggage carousel — wait until space clears before you grab your bag.You'll also want to check your destination's latest COVID-19 rules for arriving passengers. Some countries require everyone, whether vaccinated or not, to have a negative COVID-19 test on arrival and self-isolate until it's confirmed negative.Our expertsFor this article, we deeply researched across leading health organizations like the Centers for Disease Control and Prevention (CDC) and the World Health Organization (WHO). We also spoke with the following experts:Joyce Sanchez, MD, the medical director of the Travel Health Clinic at Froedtert and the Medical College of WisconsinDr. Abe Malkin, MD, MBA, the founder and medical director of Concierge MD LAJagdish Khubchandani, PhD, a professor of public health at New Mexico State UniversityThis piece was also medically reviewed for accuracy before publishing by Dr. David Aronoff, MD, director of the Division of Infectious Diseases at the Vanderbilt University Medical Center.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderNov 15th, 2021

European Army: Rhetoric Versus Reality

European Army: Rhetoric Versus Reality Authored by Soeren Kern via The Gatestone Institute, The call for a supranational army, part of a push for Europe to achieve "strategic autonomy" from the United States, is being spearheaded by French President Emmanuel Macron, who, as part of his reelection campaign, apparently hopes to replace outgoing German Chancellor Angela Merkel as the de facto leader of Europe. Many EU member states disagree with Macron. Eastern European countries, some of which face existential threats from Russia, know that neither the EU nor France can match the military capabilities offered by NATO and the United States. Other countries are concerned about a panoply of issues ranging from financial costs to national sovereignty. "If the EU Army undermines NATO, or results in the separation of the U.S. and Europe or produces a paper army, Europe will be committing the most enfeebling and dangerous act of self-harm since the rise of fascism in the 1930s. An EU Army will amount to European de-arming." — Bob Seely, Tory MP. "It will be hard to convince some member states that collective EU defense would bring the same security as NATO's U.S.-backed defense arrangement." — Richard Whitman, professor of politics and international relations at the University of Kent. "Few share France's willingness to splurge on defense, or its expeditionary military culture. (Germany, especially, does not.) Nobody agrees what 'strategic autonomy' actually means." — The Economist. "The EU is not a credible substitute for what NATO represents. You will not see any appetite for the European army amongst member states." — Kristjan Mäe, head of the Estonian defense ministry's NATO and EU department. "Even if national capitals wanted to lunge for a common army, there are so many technical, legal, and administrative differences between their militaries that it would take decades to produce a smoothly functioning force.... Conclusion: any talk of creating a fully-fledged common army, even within the next generation, is just that: jaw-jaw and not real-real." — Brooks Tigner, analyst, Atlantic Council. European federalists seeking to transform the 27-member European Union into a European superstate — a so-called United States of Europe — have revived a decades-old proposal to build a European army. The call for a supranational army, part of a push for Europe to achieve "strategic autonomy" from the United States, is being spearheaded by French President Emmanuel Macron, who, as part of his reelection campaign, apparently hopes to replace outgoing German Chancellor Angela Merkel as the de facto leader of Europe. Macron claims that Europe needs its own military because, according to him, the United States is no longer a reliable ally. He cites as examples: U.S. President Joe Biden's precipitous withdrawal of American troops from Afghanistan; the growing pressure on Europe to take sides with the United States on China; and France's exclusion from a new security alliance in the Indo-Pacific region. Many EU member states disagree with Macron. Eastern European countries, some of which face existential threats from Russia, know that neither the EU nor France can match the military capabilities offered by NATO and the United States. Other countries are concerned about a panoply of issues ranging from financial costs to national sovereignty. Still others are opposed to creating a parallel structure to NATO that could undermine the transatlantic alliance. A common EU army appears to be a long way from becoming reality. A logical course of action would be for EU member states (which comprise 21 of the 30 members of NATO) to honor past pledges to increase defense spending as part of their contribution to the transatlantic alliance. That, however, would fly in the face of the folie de grandeur — the delusions of grandeur — of European federalists who want to transform the EU into a major geopolitical power. Pictured: Soldiers of the Franco-German brigade, a military unit founded in 1989, jointly consisting of units from the French Army and German Army. (Photo by Sean Gallup/Getty Images) Strategic Autonomy The term "strategic autonomy" in European discussions on defense has been in use since at least December 2013, when the European Council, the EU's governing body comprised of the leaders of the 27 EU member states, called for the EU to improve its defense industrial base. In June 2016, the term appeared in the EU's security strategy. The document — "A Global Strategy for the European Union's Foreign and Security Policy" — was said to "nurture the ambition of strategic autonomy" for the European Union. "An appropriate level of ambition and strategic autonomy," it stated, "is important for Europe's ability to promote peace and security within and beyond its borders." In recent years, the concept of "strategic autonomy" has taken on far broader significance: the idea now means that the EU should become a sovereign power that is militarily, economically, and technologically independent from the United States. EU observer Dave Keating noted: "The Brussels buzzword is now 'strategic autonomy,' an effort to wrestle the word 'sovereignty' away from nationalists and make the case that only a strong EU can make Europeans truly sovereign in relation to Russia, China, and the United States." European federalists increasingly have called for building an autonomous EU military force: March 8, 2015. In an interview with the German newspaper Welt am Sonntag, Jean-Claude Juncker, then the president of the European Commission, the EU's administrative arm, declared that the European Union needed its own army because it was not "taken entirely seriously" on the international stage. The proposal was flatly rejected by the British government, which at the time was still an EU member: "Our position is crystal clear that defense is a national — not an EU — responsibility and that there is no prospect of that position changing and no prospect of a European army." September 26, 2017. President Macron, in a major speech at Sorbonne University, called for a joint EU defense force as part of his vision for the future of the bloc: "Europe needs to establish a common intervention force, a common defense budget and a common doctrine for action." November 6, 2018. Macron, marking the centenary of the armistice that ended World War 1, warned that Europe cannot be protected without a "true, European army." He added: "We have to protect ourselves with respect to China, Russia and even the United States of America." November 13, 2018. German Chancellor Angela Merkel echoed Macron's calls for a European army: "The times when we could rely on others are over. This means nothing less than for us Europeans to take our destiny in our own hands if we want to survive as a Union.... We have to create a European intervention unit with which Europe can act on the ground where necessary. We have taken major steps in the field of military cooperation; this is good and largely supported in this house. But I also have to say, seeing the developments of the recent years, that we have to work on a vision to establish a real European army one day." September 10, 2019. During her first press conference as the new president of the European Commission, Ursula von der Leyen, who has long called for a "United States of Europe," said that she will lead a "geopolitical Commission" aimed at boosting the EU's role on the world stage. She did not offer many details other than a vaguely worded pledge that the European Union would "be the guardian of multilateralism." November 7, 2019. President Macron, in an interview with the London-based magazine, The Economist, declared that NATO was "brain dead" and warned that European countries can no longer rely on the United States for defense. Europe, he said, stands on "the edge of a precipice" and needs to start thinking of itself strategically as a geopolitical power and regain "military sovereignty" or otherwise "we will no longer be in control of our destiny." Macron criticized U.S. President Donald J. Trump because he "doesn't share our idea of the European project." Chancellor Merkel said Macron "used drastic words — that is not my view of co-operation in NATO." November 26, 2019. France and Germany announced the "Conference on the Future of Europe," a two-year post-Brexit soul-searching exercise aimed at reforming the EU to make it "more united and sovereign." June 17, 2020. The European Council tasked the EU's foreign policy chief, Josep Borrell, with drafting a written "Strategic Compass." The document should have three main purposes: 1) to formulate the EU's first common threat analysis; 2) to strengthen the EU's security and defense role; and 3) to offer political guidance for future military planning processes. The Strategic Compass, aimed at harmonizing the perception of threats and risks within the EU, is to be presented in November 2021, debated by EU leaders in December 2021, and approved in March 2022. December 3, 2020. EU foreign policy chief Josep Borrell, in blog post, "Why European Strategic Autonomy Matters," wrote: "It is difficult to claim to be a 'political union' able to act as a 'global player' and as a 'geopolitical Commission' without being 'autonomous.'" He described "strategic autonomy" as a long-term process intended to ensure that Europeans "increasingly take charge of themselves." May 5, 2021. Fourteen EU countries — Austria, Belgium, Cyprus, Czech Republic, Germany, Greece, France, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Slovenia and Spain — called for the creation of a so-called EU First Entry Force consisting of 5,000 troops with air, land and sea capabilities. August 29, 2021. In an interview with the Italian newspaper Corriere della Sera, Borrell, the EU's foreign policy chief, said that the moment had come to establish an EU expeditionary force — a "First Entry Force" — to compensate for U.S. "disengagement" from international affairs. A senior EU diplomat, speaking to the Guardian newspaper, asked: "We have been here before — which leader is going to allow their nationals to be killed in the name of the EU? What problem is this reaction force meant to solve? Does Borrell seriously entertain the idea the EU would be able to step into the void the US left?" September 15, 2021. In her annual State of the Union speech delivered to the European Parliament in Strasbourg, von der Leyen urged greater military independence from the United States. "Europe can — and clearly should — be able and willing to do more on its own," she said. She called for a "European Defense Union" but admitted the "lack of political will" to "build the foundation for collective decision-making." October 2, 2021. European Council President Charles Michel, speaking at an award ceremony of the International Charlemagne Prize, declared that "2022 will be the year of European defense." October 5-6, 2021. At an EU Summit in Slovenia, EU member states were so divided on the issue of strategic autonomy that the topic was not even included in the summit's final declaration. To create the illusion of consensus, Michel issued an "oral conclusion" of the summit: "To become more effective and assertive on the international stage, the European Union needs to increase its capacity to act autonomously." A History of Failure The debate over building a European army has been going on since the end of World War 2. In 1950, France proposed creating a common army to protect Western Europe from the Soviet Union without having to rearm Germany. A treaty creating the so-called European Defense Community was signed in 1952, but it was never ratified by the French Parliament due to concerns that France would lose its sovereignty to a multilateral decision-making body. In the late 1990s, after the EU and its member states failed to prevent a decade of bloodletting in the Yugoslav Wars, and after the United States intervened, European leaders called for the creation of a European Rapid Reaction Force capable of acting in future crises. In 2007, after years of debate, the EU established two so-called EU battlegroups consisting of 1,500 troops each to respond to crises, but due to intra-European disputes over financing and deployment, they have never been used. The European Union is now calling for the battlegroups to be rebranded as a "First Entry Force" comprised of 5,000 troops. It remains unclear why EU leaders think the latter will achieve what the former could not. In any event, a force that small is nowhere near enough to give the EU "strategic autonomy" from the United States. Over the decades, the European quest for "strategic autonomy" has resulted in dozens of summits, declarations, concept papers, reports, institutions, terms and acronyms, including: Petersberg Declaration; St. Malo Declaration; Berlin Plus Agreement; Franco-German Brigade; German-Netherlands Corps; Belgian-Dutch Naval Cooperation Accord; European Security and Defense Policy (ESDP); Common Security and Defense Policy (CSDP); Permanent Structured Cooperation (PESCO); European Capabilities Action Plan (ECAP); Headline Goals; EU Battlegroups; European Gendarmerie Force; European Rapid Operational Force (EUROFOR); European Maritime Force; Eurocorps; Combined Joint Expeditionary Force (CJEF); Entente frugale; European Defense Agency; European Security Strategy; European Intervention Initiative (EI2); EUFOR; European Command and Control (C2); European Union Military Committee (EUMC); European Union Military Staff (EUMS); Joint Support Coordination Cell (JSCC); Military Planning and Conduct Capability (MPCC); Political and Security Committee (PSC); Politico-Military Group (PMG); European Defense Fund; Coordinated Annual Review on Defense (CARD); and the EU's ongoing "Strategic Compass" process, among many others. German Defense Minister Annegret Kramp-Karrenbauer, in a recent opinion article published by Politico, concluded that "illusions of European strategic autonomy must come to an end." She added: "Europeans will not be able to replace America's crucial role as a security provider. We have to acknowledge that, for the foreseeable future, we will remain dependent." Lack of Capabilities An important obstacle to building a European army is the reluctance of EU governments to invest in defense. At the 2014 Wales Summit of the North Atlantic Treaty Organization, allies agreed to spend a minimum of 2% percent of their gross domestic product (GDP) to defense spending. In 2020, only nine of NATO's 21 European members honored their pledges, according to data supplied by NATO. Germany — the biggest economy in the EU and the fourth-biggest in the world — spent only 1.53% of GDP on defense in 2020. That represents an increase of less than 0.5% of GDP since 2015. France, the EU's second-biggest economy, spent 2.01% of GDP on defense in 2020, an increase of only 0.3% of GDP since 2015. Italy, the EU's third-biggest economy, spent 1.41% of GDP on defense in 2020, while Spain, the EU's fourth-biggest economy, spent a mere 1.02% of GDP on defense in 2020, according to NATO data. The numbers show that defense spending is not a priority in most European countries. The German armed forces (the Bundeswehr) are in an especially sad state of disrepair. A damning report published by the German Parliament in January 2019 found that critical equipment was scarce and that readiness and recruitment were at all-time lows. "No matter where you look, there's dysfunction," said a high-ranking German officer stationed at Bundeswehr headquarters in Berlin. A May 2018 report by the German magazine Der Spiegel revealed that only four of Germany's 128 Eurofighter jets were combat ready. Germany's obligation to NATO requires it to have at least 80 combat-ready jets for crisis situations. At the end of 2017, not one of the German Air Force's 14 large transport planes was available for deployment due to a lack of maintenance, according to the German Parliament. In October 2017, a spokesman for the German Navy said that all six of Germany's submarines were in the dock for repairs. In February 2015, Germany's defense ministry admitted that its forces were so under-equipped that they had to use broomsticks instead of machine guns during a NATO exercise in Norway. Much of the blame falls on German Chancellor Angela Merkel. During her 16 years in office, she has been content to free-ride on the U.S. defense umbrella. Also to blame is Ursula von der Leyen, who was German defense minister between 2014 and 2019, before she was promoted to lead the European Commission, and who now wants to build a European army. As German defense minister, von der Leyen was plagued by scandals and accused of cronyism, mismanagement and nepotism. EU affairs analyst Matthew Karnitschnig quipped: "With Merkel on her way out, fixing the Bundeswehr will likely be up to her successor. Until then, plans for a 'European Army' that includes Germany have about as much chance of getting off the ground as the German Air Force." France, which has just under 300,000 active-duty personnel, has the largest military in Europe. Still, it remains a regional power, not a global one. In September 2021, the RAND Corporation, in a major study — "A Strong Ally Stretched Thin: An Overview of France's Defense Capabilities from a Burdensharing Perspective" — concluded that the French military suffers many shortcomings that render as "limited" its capacity to sustain a high-end, conventional conflict. The French Army "faces a challenge with respect to readiness, owing to past budget cuts and austerity measures, a small number of weapon systems, and the burden of sustaining ongoing overseas operations," according to RAND. The French Air Force "suffers from limited capacity" and "severely lacks strategic airlift." The French Navy, which has only one aircraft carrier, like France's other services, "has issues with readiness, and munitions stocks reportedly are low," according to RAND. The report's takeaway is that the French military would require decades of preparation and massive budget increases to realistically form the basis for a European army. Poland, which is opposed to a European army because it would "weaken" the armies of NATO's member states, plans to double the size of its armed forces to 250,000 soldiers and 50,000 reserves. The expansion, announced on October 26, would make the Polish military the second-largest in Europe, ahead of that of the United Kingdom. In January 2020, Poland signed a contract worth $4.6 billion to purchase 32 F-35A fighter jets from the United States. In October 2018, Belgium signed a $4.5 billion deal to purchase 34 F-35A fighter jets from the United States. "The offer from the Americans was the best in all our seven evaluation criteria," Belgian Defense Minister Steven Vandeput wrote on Twitter. "The decision is a setback for Britain, Germany, Italy and Spain, who are behind the Eurofighter program, and also means the rejection of an informal French offer to sell Belgium the Rafale fighter built by Dassault Aviation," according to Reuters. This implies that in the future the Belgian and Polish militaries will be further integrated with the United States and NATO rather than with a hypothetical European army. Macron's Motives One of the most vocal champions of the idea of a European army is French President Emmanuel Macron. He must know that an independent EU military remains only a distant possibility, despite his describing the NATO alliance as "brain dead." As German Chancellor Angela Merkel is set to retire, it appears that much of Macron's posturing on European "strategic autonomy" is part of a French nationalist campaign strategy aimed at presenting France as a great power that dominates the European Union. Macron seems to be trying to appeal to French voters while carving out a role for himself to replace Merkel as the new leader of Europe. Macron, who has yet to declare his candidacy, faces reelection in April 2022. Currently he is the clear first-round front-runner at 24%, according to recent polls cited by Politico. His main rivals are two nationalists: Marine Le Pen of the right-leaning National Rally party, and Éric Zemmour, a French essayist and media personality. Macron has been calling for a European army for several years, but his professed aspiration for "strategic autonomy" shifted into high gear after U.S. President Donald J. Trump threatened to withdraw from NATO if European member states refused to pay their fair share. Trump's warning, which appears to have been more of a bluff than a real threat, prompted many European countries to increase their defense spending, even if most are still below the agreed-upon threshold of 2% of GDP. Macron subsequently was dealt a humiliating blow by the Biden administration. In September 2021, Australia, the United Kingdom and the United States announced a new tripartite strategic alliance aimed at countering China's growing assertiveness in the Indo-Pacific region. Notably, the so-called AUKUS agreement does not include any member state of the European Union, which was completely left in the dark about the new alliance. AUKUS was announced on September 15, just hours before the EU unveiled its much-hyped "Strategy for Cooperation in the Indo-Pacific." The EU had been hoping that its new plan would highlight its "strategic autonomy" from the United States in the Pacific region. Instead, the EU was eclipsed by AUKUS and exposed as a paper tiger. Adding insult to injury, Australia announced that as part of the AUKUS deal, it had cancelled a multi-billion-dollar submarine contract — once dubbed the "contract of the century" — under which France was to supply Australia with 12 diesel-powered submarines. Instead, Australia said that it would be buying nuclear submarines from the United States. France has reacted angrily to its change of fortunes. French Foreign Minister called AUKUS a "stab in the back." The French Ambassador to Australia, Jean-Pierre Thébault, said that Australia's decision to cancel the submarine deal was akin to "treason." The French government claimed that the Australian decision caught Paris by surprise, but the subsequent leak of a text message between Macron and Australian Prime Minister Scott Morrison revealed that Macron knew well in advance that Australia was planning to cancel the contract. The AUKUS humiliation set Macron into a rage and appears to be fueling his increasingly frenzied calls for "strategic autonomy." An advisor to Macron said: "We could turn a blind eye and act as if nothing had happened. We think that would be a mistake for all Europeans. There really is an opportunity here." So far, however, only Italy and Greece have come out in support of Macron's calls for an autonomous EU military force. In September 2021, France and Greece signed a new defense and security agreement in which France pledged to provide military assistance to Greece in the event of an attack by a third country, even if such a country, Turkey, is a member of NATO. Macron said the deal, worth $3 billion to France, was a "milestone" in European defense because it strengthened the EU's "strategic autonomy." Greek Prime Minister Mitsotakis described the Greek-French defense deal "a first step towards the strategic autonomy of Europe." But some in the EU were skeptical of the deal and are concerned it will only serve to inflame tensions between Greece and Turkey. "It is a bit bizarre to say the pact contributes to European sovereignty," an unnamed EU diplomat told Politico. "By all accounts, this is a traditional 19th-century defense pact between two European powers." Danish Prime Minister Mette Frederiksen, in an interview with the Danish newspaper Politiken, said that Macron was escalating his dispute with the United States way out of proportion: "I think it is important to say, in relation to the discussions that are taking place right now in Europe, that I experience U.S. President Joe Biden as being very loyal to the transatlantic alliance. "I think in general that one should refrain from lifting some specific challenges, which will always exist between allies, up to a level where they are not supposed to be. I really, really want to warn against this." Meanwhile, the British newspaper, The Telegraph, on September 22 reported that Macron had offered to put France's seat on the United Nations Security Council "at the disposal of the European Union" if its governments back Macron's plans for an EU army. The French Presidency later denied the report: "Contrary to the assertions reported this morning, no, France has not offered to leave its seat on the United Nations Security Council. It belongs to France, and it will remain so." France assumes the EU's six-month rotating presidency on January 1, 2022. During that time, Macron is sure to continue pushing for "strategic autonomy" from the United States, including at a "Summit on European Defense" scheduled for the first half of 2022. Select Commentary Analysts James Jay Carafano and Stefano Graziosi, in an essay, "Europe's Strategic Autonomy Fallacy," wrote: "Strategic autonomy might sound empowering, but it remains little more than a distraction and irritant to the transatlantic community and the real issues. European nations need more national defense capacity. Europe needs a strong, innovative, and productive defense industrial base, and Europeans need to take collective security and its role in a Europe whole, free, prosperous and at peace seriously. These problems can be better addressed by building the militaries the Europeans need than the fantasies Brussels wants." A senior Tory MP, Bob Seely, warned: "If the EU Army undermines NATO, or results in the separation of the U.S. and Europe or produces a paper army, Europe will be committing the most enfeebling and dangerous act of self-harm since the rise of fascism in the 1930s. An EU Army will amount to European de-arming." EU affairs expert Dave Keating noted: "The problem is that while leaders like Macron have tasked the Commission to make the EU more geopolitically strong, he and others still refuse to give the Commission the tools that would make it strong. For the last decade, the European Council has consistently opposed measures that would strengthen the Commission, because it would mean diluting the power of national governments.... "EU national leaders are all well aware of the need for Europe to speak with one voice if it ever wants to be taken seriously on the global stage. But their natural instinct to preserve their own power gets in the way of achieving this goal." In an interview with France 24, the French state-owned television network, Richard Whitman, a professor of politics and international relations at the University of Kent, said: "It will be hard to convince some member states that collective EU defense would bring the same security as NATO's U.S.-backed defense arrangement. Nobody in the EU has ever been able to come up with a decision-making arrangement that takes national divides into account while facilitating expeditious decision-making; it's either the lowest common denominator or grand rhetorical comments tied to absurd propositions. Military action is politically defensible only when taken by national leaders and parliaments — and it's difficult to see that being worked around." Writing for the Wall Street Journal, Walter Russell Mead noted that the entire premise of European leaders that the United States was "disengaging" from international affairs was based on a "significant misunderstanding." He wrote: "Many Europeans, including some seasoned observers of the trans-Atlantic scene, believe that if the U.S. sees the Indo-Pacific as the primary focus of its foreign policy, it must be writing off the rest of the world. These observers look at the American withdrawal from Afghanistan and imagine that this is the kind of headlong retreat they can expect from America in Europe and the Middle East. "This is unlikely. American interests are global, and American presidents, like it or not, can't confine their attention to a single world theater." Polish analyst Łukasz Maślanka tweeted that the French arguments for "strategic autonomy" from the United States are lacking in substance: "French reports from the European Council summit in Slovenia assess Macron's chances of convincing Europeans to EU defense. A critical tone prevails against the reluctant Balts and Poles who still stubbornly believe in NATO despite the U.S.'s allegedly inevitable withdrawal from Europe. "However, it is French observers who lack lucidity: the U.S. presence in Central Europe has been growing, not diminishing in recent years. It is many times greater not only than what France currently delivers, but what it could ever deliver. "Finally, if the U.S. really did intend to turn its back on Europe, the dismay in Paris would be no less than in Warsaw. It's harmful to drive something that can finally become a self-fulfilling prophecy." The London-based magazine, The Economist, wrote that Europeans feel "unnerved" by Macron's push for "strategic autonomy" from the United States: "Most of them, especially those near the Russian border, are happy to rely on America's security guarantee. Few share France's willingness to splurge on defense, or its expeditionary military culture. (Germany, especially, does not.) Nobody agrees what 'strategic autonomy' actually means. Low odds, however, seldom deter Mr. Macron. After the latest snub, the unhugged French president will doubtless conclude that he has little choice but to keep trying." John Krieger, writing for the UK-based The Spectator, noted: "Given that Emmanuel Macron has nailed his colors to the mast on driving European integration deeper, a refusal by European member states to follow suit would be embarrassing and not a good omen for his forthcoming presidency of the EU in January." Kristjan Mäe, head of the Estonian defense ministry's NATO and EU department said: "The EU is not a credible substitute for what NATO represents. You will not see any appetite for the European army amongst member states." Analyst Brooks Tigner, writing for the Atlantic Council, concluded: "Even if national capitals wanted to lunge for a common army, there are so many technical, legal, and administrative differences between their militaries that it would take decades to produce a smoothly functioning force. "Those differences boil down to some of the most mundane things such as soldiers' rights. Strong unions representing military personnel in rich Scandinavian countries, for instance, ensure that their soldiers enjoy levels of physical comfort, hardship pay, and access to medical care that their equivalents in poorer southern EU countries can only dream of for an exercise, much less an actual operation. Whose union rules would govern a common European army? And how would that be financed? "The differences are even sharper at the strategic level when it comes to intelligence. As a whole, the EU countries (and those of NATO as well) do not trust one another with sensitive information: it is parceled out very parsimoniously from one capital to a few trusted others. It would never work for a truly common army. Changing that alone via twenty-five-way trust for intelligence-sharing within PESCO would take years and years. Some deem it impossible. "Conclusion: any talk of creating a fully-fledged common army, even within the next generation, is just that: jaw-jaw and not real-real." Tyler Durden Sat, 11/13/2021 - 08:10.....»»

Category: blogSource: zerohedgeNov 13th, 2021

These Marines disarm bombs for a living. Here"s what it"s like doing one of the US military"s most dangerous jobs.

Two combat-tested bomb squad Marines shared what it's like "moving toward the danger that most people were running away from." A Marine EOD tech carrying ordnance from a vehicle-borne improvised explosive device. US Marine Corps One of the military's most dangerous jobs is explosive ordnance disposal technician. These troops risk life and limb responding to IEDs and other explosive threats. Two seasoned Marine Corps EOD techs recently told Insider about the challenges of the job. There is no shortage of dangerous jobs in the US military, and one of the more dangerous is that of an explosive ordnance disposal technician, the troops serving in military bomb squads.EOD technicians run toward deadly threats that others avoid, such as improvised explosive devices, and the cost of even a minor misstep could be loss of life or limb."There's been times when I was standing over something that could kill me and I was there trying to picture all the choices I made in life that got me to that moment," Marine EOD tech Master Sgt. Carlos Villarreal, who has been in the Marines for over 18 years, told Insider.One of the most terrifying moments of Villarreal's career in the military came during his first combat deployment as an EOD tech, when his team leader was killed responding to an IED in Afghanistan in 2011. His death shook Villarreal, putting the risks of the job into focus."He was one of the guys that we looked up to," Villarreal said, recalling thinking at the time, "If someone as good as he was could pass away, what are my chances of getting through this?"He pushed those thoughts aside though and did his job. He said the training he received from that gunnery sergeant and others is what got him back home alive. An explosive ordnance disposal Marine working with a simulated IED during a training exercise. US Marine Corps 'If you think it's going to blow up, don't go down there'EOD technicians are highly trained, with training programs lasting almost a year and covering a lot of vital information to not only do the job but survive it, but even with excellent training, the job is still challenging.Sometimes explosives are complex. Sometimes a bomb is in a location that makes it difficult to manage, such as near a populated civilian area like a hospital or school. And sometimes it is not immediately clear there is a threat present until someone stumbles upon it."A couple times I've been right on top of an IED before I knew it," Chief Warrant Officer 5 Michael Gaydeski, who has been an EOD tech for most of his 23 years in the Marines and who previously deployed to Iraq, told Insider."It's always the one you don't know about that's going to get you," he said. "I've definitely been one footstep away from stepping on something before I saw it. That's definitely alarming."Both Gaydeski and Villarreal made it through their respective deployments, but not everyone does. They said the hardest part of the job is losing people, and Villarreal shared that he has lost friends, fellow EOD techs, to combat, as well as to fights with inner demons like post-traumatic stress disorder. Marine Corps Chief Warrant Officer 5 Michael Gaydeski, the officer in charge for Headquarters and Headquarters Squadron Explosive Ordnance Disposal (EOD), goes over standard operating procedures with EOD technicians. US Marine Corps Photo by Lance Cpl. Jacob Bertram Every Marine EOD tech approaches the stresses of the job differently. Villarreal pointed to the tight, familial EOD community, explaining that EOD personnel "count on each other to get through those stressful times." Gaydeski spoke positively about the EOD community as well, calling it the best part of the job, but added that his faith also helps him confront its challenges."I believe in God, and I believe he is in control. I believe I will die when he says I'm going to die," he said. "I trust God, and I don't find any stress in disarming bombs.""But don't get me wrong. I'm a pretty careful individual, and I preach that to my guys," Gaydeski said, noting that "there are always things you can do to mitigate the hazards of a situation."He said that EOD personnel have to be on guard against complacency, explaining that is "where guys in my field start to get hurt."Another important lesson he tries to drive home is caution, that "if you think it's going to blow up, don't go down there."EOD personnel have heavy protective armor commonly called bomb suits to shield them from smaller blasts, but they do not make the wearer invincible. If it is something like a vehicle-sized bomb, "all the armor in the world is not going to save you if you are right on top of it," Gaydeski said.The bulky bomb suit can actually be a hindrance in some situations because it limits dexterity and impacts an EOD tech's vision. So in some dangerous situations, an EOD technician may be going in with only limited protective gear.Gaydeski said that if he does not have a good feeling about something, he is not going down there. "I am going to use robotics or some other remote means to mitigate it," he said, explaining there are usually, though not always, other options available. A Marine explosive ordnance disposal technician responding to a simulated vehicle-borne IED in training. US Marine Corps 'You have to make a decision'The Marine Corps EOD community consists of volunteers who came from other military occupational specialties. Gaydeski was an infantry Marine for four years and Villarreal was a communications technician before they joined EOD.EOD appeals to different Marines for different reasons. Villarreal decided he wanted to be an EOD technician when he saw an EOD team in action during a deployment to Iraq."Watching those guys, their professionalism and their courage, made me want to lat[eral] move to that community," he said, adding that he "wanted to be one of these guys that was moving toward the danger that most people were running away from." Marine Corps Master Sgt. Carlos Villarreal, an EOD technician, delivers a safety brief. US Marine Corps Photo by Lance Cpl. Jacob Bertram When Marines volunteer to work in explosive ordnance disposal, they are put through a screening process to make sure that they are suitable and then sent to EOD school at Eglin Air Force Base for training.Probably the toughest part of the training, Gaydeski said, is a test that requires future EOD techs to combine and use all of the skills they learn in the program."An instructor will walk you up from a long ways away and say, 'Okay, you see that there? That's your problem.' And that is basically all you get, that this is your problem," Gaydeski said."They give it to you with a scenario, maybe like it is in a hospital or outside a school or something like that," he said. "The reason for that is to make it so you can't push the easy button and just blow it up."Regardless of whether it is a training scenario or real-world situation, the EOD techs have to approach it with the realization that their actions have consequences, but they can't let that overwhelm them, letting caution lead to inaction."You have to make a decision," Villarreal said, adding that "you have to be confident in your choice," whatever that might be. "That is how you're going to get through the day," he said. A Marine wearing a heavy protective EOD bomb suit. US Marine Corps 'We're never told what might have been'Both Gaydeski and Villarreal are at Marine Corps Air Station Cherry Point in North Carolina. Gaydeski is the uniformed officer in charge, running an EOD team tasked with emergency explosive response for the base and surrounding areas, and Villarreal is the staff non-commissioned officer in charge for the EOD section.On combat deployments overseas, these EOD technicians attached to various units and primarily dealt with IEDs. Here in the US, they and their fellow EOD techs sometimes support local law enforcement, responding to local explosive threats that are at times quite different from what they saw in Iraq and Afghanistan.Gaydeski said that here in the US, they often get called out to respond to some sort of unexploded ordnance, however it turns up in eastern North Carolina.It is not out of the ordinary for some sort of explosive to wash up on the beach after a hurricane, he said, explaining that "there is actually a lot of ordnance in the ocean." He added that "cannonballs from Civil War and Revolutionary War battlefields are also more common than people think.""And then World War II veterans brought a lot of stuff home too," Gaydeski said."A common call we get here in North Carolina is, 'Hey, I was cleaning out my grandfather's garage and I found this grenade,'" he said. "That's something the military has a cradle-to-the-grave policy on. We don't abandon any of our ordnance, even if some of it does get misplaced for a while."Working with dangerous explosives, be it fusing bombs, disarming IEDs, taking care of a grenade someone found in the attic, or putting on fiery explosive displays at an airshow, is something that is sometimes misunderstood by those on the outside looking in.Villarreal said that sometimes when he tells people what he does for a living, people get the wrong idea about him and his work, assuming that he must be a crazy thrill seeker."One of the biggest misconceptions is that we are adrenaline junkies, that we're crazy, that we're cowboys, but really, we're quite sane," said Villarreal."For me, it's always been about trying to save lives," he said. "We are essentially first responders. A person that wants to this job is the type that cares about people."Gaydeski explained that "the people that are attracted to this field are, as a rule, not adrenaline junkies," adding that they "are professionals who have a code and are seeking to serve our fellow man.""We are enablers for the infantry. We disarm hazards that are beyond their capability so that they can continue their maneuver," he said. "I hope it's important. I hope that I have saved lives. We're never told what might have been."Read the original article on Business Insider.....»»

Category: topSource: businessinsiderNov 11th, 2021

"They Have Lost Control" - Michael Snyder Warns "Our Destination Is Economic Collapse"

"They Have Lost Control" - Michael Snyder Warns "Our Destination Is Economic Collapse" Authored by Michael Snyder via TheMostImportantNews.com, I think that they actually believed that they could get away with it.  I think that they were actually convinced that they could create, borrow and spend trillions upon trillions of dollars without any serious long-term consequences.  But they should have known better.  The people running things are very highly “educated”, and after spending decades getting to their current positions they are supposed to be “experts” that we can trust with very difficult decisions.  Unfortunately, the “experts” have put us on a path that leads to currency collapse and financial ruin. All throughout history, there have been many governments that have given in to the temptation to create money at an exponential rate, and it has ended badly every single time. So our leaders should have known better. But it is just so tempting, because pumping out money like crazy always seems to work out just great at first.  For example, when the Weimar Republic first started wildly creating money it created an economic boom, but we all know how that experiment turned out in the end. This week, the mainstream media is full of talk about inflation, and many of the talking heads seem mystified that things have gotten so bad.  But anyone with half a brain should have been able to see that this was coming.  Just look at what has been happening to M2 since the start of the pandemic. What we have been doing to the money supply is complete and utter lunacy, and this is inevitably going to kill the U.S. dollar eventually. Next, I would like for you to take a look at how rapidly the Fed balance sheet has been rising.  This is the sort of thing that you would expect to see in a banana republic. I think that our leaders deceived themselves into thinking that they could get away with creating money so recklessly, but they haven’t. Very painful inflation is here, and on Wednesday we learned that prices have been rising at the fastest pace in more than 30 years… The consumer price index, which is a basket of products ranging from gasoline and health care to groceries and rents, rose 6.2% from a year ago, the most since December 1990. That compared with the 5.9% Dow Jones estimate. On a monthly basis, the CPI increased 0.9% against the 0.6% estimate. If inflation continues to rise at about 1 percent a month, it won’t be too long before we are well into double digits on a yearly basis. Of course I don’t actually put too much faith in the inflation numbers that the government gives us, because the way inflation is calculated has been changed more than two dozen times since 1980. And every time the definition of inflation has been changed, the goal has been to make inflation appear to be lower. According to John Williams of shadowstats.com, if inflation was still calculated the way it was back in 1980, the official rate of inflation would be close to 15 percent right now. This is a real national crisis, and it isn’t going away any time soon. One of the factors that is driving up the overall rate of inflation is the price of gasoline.  If you can believe it, the price of gas is almost 50 percent higher than it was last year at this time… Gasoline prices last month shot up nearly 50% from the same month a year ago, putting them at levels last seen in 2014. Grocery prices climbed 5.4%, with pork prices up 14.1% from a year ago, the biggest increase since 1990. Prices for new vehicles jumped 9.8% in October, the largest rise since 1975, while prices for furniture and bedding leapt by the most since 1951. Prices for tires and sports equipment rose by the most since the early 1980s. Even Joe Biden is using the term “exceedingly high” to describe the current state of gasoline prices. Other forms of energy are also becoming a lot more expensive… The price of electricity in October increased 6.5% from the same month a year ago while consumer expenses paid to utilities for gas went up 28%, according to numbers released Wednesday by the U.S. Bureau of Labor Statistics. Fuel oil rose 59%, and costs for propane, kerosene and firewood jumped by about 35%, the data show. It is going to cost you a lot more money to heat your home this winter. I hope that you are prepared for that. Speaking of homes, they continued to shoot up in price during the third quarter… The median price of single-family existing homes rose in nearly all — 99% — of the 183 markets tracked by the National Association of Realtors in the third quarter, with double-digit price increases seen in 78% of the markets. If our paychecks were rising fast enough to keep up with inflation, then at least our standard of living would remain the same. But that isn’t happening, is it? In fact, the Labor Department’s own numbers show that real average hourly earnings are going down… The Labor Department reported Friday that average hourly earnings increased 0.4% in October, about in line with estimates. That was the good news. However, the department reported Wednesday that top-line inflation for the month increased 0.9%, far more than what had been expected. That was the bad news – very bad news, in fact. That’s because it meant that all told, real average hourly earnings when accounting for inflation, actually decreased 0.5% for the month. What this means is that our standard of living is going down. And it is going to keep going down. In a desperate attempt to maintain the status quo, many Americans are taking on more debt than ever before… American households are carrying record amounts of debt as home and auto prices surge, Covid infections continue to fall and people get out their credit cards again. Between July and September, US household debt climbed to a new record of $15.24 trillion, the Federal Reserve Bank of New York said Tuesday. How in the world did we allow ourselves to get 15 trillion dollars in debt? Of course many would point out that the federal government is an even worse offender.  Very shortly, the U.S. national debt will cross the 29 trillion dollar mark. As our leaders in Washington continue to engage in the greatest debt binge in world history, the U.S. dollar will steadily lose value. This is going to deeply affect everyone and everything in our society.  For instance, just check out the pain that inflation is causing for one food bank in the San Francisco area… In the prohibitively expensive San Francisco Bay Area, the Alameda County Community Food Bank in Oakland is spending an extra $60,000 a month on food. Combined with increased demand, it is now shelling out $1 million a month to distribute 4.5 million pounds (2 million kilograms) of food, said Michael Altfest, the Oakland food bank’s director of community engagement. Pre-pandemic, it was spending a quarter of the money for 2.5 million pounds (1.2 million kilograms) of food. I warned you way ahead of time that this was coming, and what we have experienced so far is just the beginning. The “experts” running the Fed and our politicians in Washington aren’t going to suddenly reverse direction. In fact, Congress just passed another gigantic spending bill that Joe Biden desperately wanted. Our course has been set and there is no turning back. Our destination is economic collapse, and life in America will never, ever be the same again. *  *  * It is finally here! Michael’s new book entitled “7 Year Apocalypse” is now available in paperback and for the Kindle on Amazon. Tyler Durden Thu, 11/11/2021 - 16:20.....»»

Category: blogSource: zerohedgeNov 11th, 2021

The US military is under fire over how it handles race. Uncensored WWII-era surveys show US troops struggling with the same issue 80 years ago.

When challenged on race-related issues during World War II, the US War Department took the position that it did not see skin color. African-American messmen aboard a US Navy cruiser who volunteered for additional duty as gunners under the instruction of the officers at the right, July 1942. PhotoQuest/Getty Images Recent controversy over how issues of race are taught in the US has ensnared grade schools, universities, and even the military. As World War II-era surveys show, the military has grappled with those issues for decades and often falls short of its own standards. Edward J.K. Gitre is an assistant professor of history at Virginia Tech and director of The American Soldier in World War II project. Months of protests over how the US's troubled history of race is taught came to a head on Election Day in Virginia.If Governor-elect Glenn Youngkin bans critical race theory in the commonwealth's public schools on "Day One," as he vowed on Fox News in the closing hours of his campaign, the battle will hardly be over.In those same remarks, Youngkin implored viewers to heed Martin Luther King Jr.'s "immortal words" that "we're called to judge one another based on the content of our character and not the color of our skin." Heirs of King's work and others have pilloried invocations of his "I have a dream" sermon to justify banning discussion of systemic racism.The agitation over critical race theory - a field of scholarly inquiry that examines how racism, intentional or not, is institutionalized and embedded in laws, systems, and policies - and competing citations of King are only the latest expressions of a long-running conflict over persistent racial inequality in America.This phase has focused on schools, but for 80 years, and well before King's sermon, the US military has struggled with the same issue.'We will do better' Secretary of Defense Lloyd Austin and Chairman of the Joint Chiefs of Staff Gen. Mark Milley before the Senate Armed Services Committee, September 28, 2021. Alex Wong/Getty Images Over those eight decades, the military has espoused the precept that people ought to be judged by their character and performance, not their skin color. It has fallen well short of its own standard.The Department of Defense does now have its first Black secretary, Lloyd Austin. While African-Americans represent 19% of all active-duty service members, the military has only two Black four-star generals and admirals, as Maryland Rep. Anthony Brown, a retired Army colonel, reminded Austin during a hearing this summer.Pressed by Brown on the "significant underrepresentation" of people of color and women in the senior ranks, Austin touted the military's diversity as reflective of the American public but concurred with Brown: "We need to do better. You have my commitment. We will do better." African-American soldiers in Army trucks at the Las Vegas Army Air Force Airfield, 1942. Ivan Dmitri/Michael Ochs Archives/Getty Images The military hasn't avoided backlash over critical race theory, either. Gen. Mark Milley, chairman of the Joint Chiefs of Staff, made headlines at the same hearing for his considered but forceful response to another congressman's accusation that cadets were being indoctrinated with critical race theory.The military's handling of other race-related issues has received much less coverage, however.At the same hearing, Brown asked more pointed questions about a 2019 study by the Government Accountability Office, which found that minority personnel across the military were more than five times as likely as White personnel to be court-martialed for similar conduct."Why are the commanders woefully failing our Black service members who serve at higher rates than any other demographic group?" Brown asked Austin. "And how do we fix this system so that there is truly equal justice under the Uniform Code of Military Justice?"Fighting 2 wars A "Colored Waiting Room" sign at a bus station in Durham, North Carolina, May 1940. Universal History Archive/Universal Images Group via Getty Images When challenged on similar issues during World War II, the US War Department took the position that it did not see skin color.Before and long after Congress passed the country's first peacetime draft in September 1941, Black leaders lobbied the Roosevelt administration to enact anti-discrimination policies.To one such recommendation, the Secretary of War Henry Stimson responded that not only was "everything possible" being done, but also that "Our policies make no distinction between white and colored soldiers."Distinctions, of course, were made every day across the force and in the communities that surrounded and served the department's facilities and installations - and it was official department policy.Despite this "extensive campaign," Army Chief of Staff George C. Marshall assured one northern senator that the department's policy "not to intermingle colored and white enlisted personnel in the same regimental organization" would hold.Preventing racial commingling was costly and difficult. It required the construction and maintenance (of differing quality) of separate barracks, latrines, mess halls, clubs, theaters, swimming pools, and post exchanges, among others - expanding Jim Crow's reach as more bases were built. African-American soldiers in England, September 12, 1942. Hulton-Deutsch Collection/CORBIS/Corbis via Getty Images Beginning in August 1942, the War Department delegated the segregation of recreation facilities, including theaters and post exchanges, to local commanders.The following March the department went a step further, prohibiting separate Black and White recreation facilities where two or more races were garrisoned.Resistance was predicted. From surveys administered to monitor morale, the Army already knew that the majority of White soldiers - from the north and south - opposed integration.Only 148 of the 4,793 enlisted personnel who participated in a large cross-section survey given in March 1943 thought Black and White soldiers should serve in the same outfits. Just one in 12 thought it OK to share service clubs, and only one in seven approved of sharing post exchanges.Opponents listed the likelihood of conflict as their primary concern."If negroes & whites were in same outfits, naturally there would be much blood shed. It would lead into serious developments, in the future. In fact I believe we would be fighting two wars, negroes & the Axis," wrote one White soldier.Some commanders responded to the new order by replacing the offending signs and maintaining Jim Crow in other ways. Others simply ignored it.Non-enforcement coincided with a buildup of Black troops, and by summer 1943 discontented Black Americans took to the streets across the US. US soldiers in a mess hall, 1942 Afro American Newspapers/Gado/Getty Images The Army did take steps to address segregated transportation facilities - a frequent source and site of racial intimidation, conflict, and violence - by ordering local commanders to eliminate discrimination based on color, race, or creed.Those commanders, even cooperative ones, still had to rely on civilian services that maintained those practices. But with White soldiers and officers in open defiance of the military's efforts to end discrimination, resentment mounted.Handwritten open-ended responses from an August 1944 survey, which have only recently been transcribed, reveal the depth and breadth of what Assistant Secretary of War John J. McCloy described as a "radical change" in attitudes."Sooner or later there will be some changes made one way or the other," warned one Black soldier. "The boys are getting tired of it. We all fighting like any other soldier and it is a god dam[n] shame that some people can let such conditions exist & call this a democracy.""Fascism is fascism, whether in America or in Europe and if we are all fighting for the same common purpose why must there be a White Army and Negro Army," wrote another.Lessons unlearned Men assemble cylinder barrels for an engine at Buick's aviation plant in Melrose Park, Illinois, 1942. Buyenlarge/Getty Images The Army could not wait for White attitudes to change. A pressing need for replacements in Europe led the Army to compromise its commitment not to intermingle personnel.Gen. John C. H. Lee, deputy theater commander in Europe, issued a letter on December 26, 1944, recruiting Black volunteers to join White rifle companies. Mixed companies were soon formed in 11 divisions in two separate armies.The results, documented by before-and-after surveys of White officers, were remarkable.Only one-third of those initially surveyed were in favor of leading mixed companies. After integration, that rose to 77%.When asked how Black troops had performed in combat, 84% of the officers and 81% of the platoon sergeants said they had done so admirably, improving relations between Black and White troops. US troops with a captured Nazi flag in front of a wrecked German tank in Chambois, France, August 20, 1944. CORBIS/Corbis via Getty Images Aware of the political potency of such unambiguous data, especially for anti-segregationists, the Army initially withheld it, but it made its way into the recommendations of the Faye Committee, which supported President Harry S. Truman's 1948 executive order ending segregation in the military.Army survey researchers also later assisted defendants in Brown v. Board of Education, the case that rejected the segregationist doctrine of "separate but equal."That Brown could speak of the committee's recommendations as unfulfilled as he did during his questioning of Austin this summer, after all these years, shows the US's failure to learn World War II's lessons.As the military saying goes, all soldiers bleed green and their color is camouflage, but without justice, opportunity, and leadership - and without enforcement of rules and guidelines meant to undo that inequality - the notion that skin color doesn't matter only masks social and racial inequities and ensures the status quo.Edward J.K. Gitre is an assistant professor of history at Virginia Tech and director of The American Soldier in World War II project.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderNov 11th, 2021

America"s Woke Colleges Can"t Be Salvaged. We Need New Ones

America's Woke Colleges Can't Be Salvaged. We Need New Ones Authored by Niall Ferguson, op-ed via Bloomberg.com, I'm Helping to Start a New College Because Higher Ed Is Broken If you enjoyed Netflix’s “The Chair” - a lighthearted depiction of a crisis-prone English Department at an imaginary Ivy League college - you are clearly not in higher education. Something is rotten in the state of academia and it’s no laughing matter.   Grade inflation. Spiraling costs. Corruption and racial discrimination in admissions. Junk content (“Grievance Studies”) published in risible journals. Above all, the erosion of academic freedom and the ascendancy of an illiberal “successor ideology” known to its critics as wokeism, which manifests itself as career-ending “cancelations” and speaker disinvitations, but less visibly generates a pervasive climate of anxiety and self-censorship. Some say that universities are so rotten that the institution itself should simply be abandoned and replaced with an online alternative — a metaversity perhaps, to go with the metaverse. I disagree. I have long been skeptical that online courses and content can be anything other than supplementary to the traditional real-time, real-space college experience. However, having taught at several, including Cambridge, Oxford, New York University and Harvard, I have also come to doubt that the existing universities can be swiftly cured of their current pathologies. That is why this week I am one of a group of people announcing the founding of a new university — indeed, a new kind of university: the University of Austin. The founders of this university are a diverse group in terms of our backgrounds and our experiences (though doubtless not diverse enough for some). Our political views also differ. To quote our founding president, Pano Kanelos, “What unites us is a common dismay at the state of modern academia and a belief that it is time for something new.” There is no need to imagine a mythical golden age. The original universities were religious institutions, as committed to orthodoxy and as hostile to heresy as today’s woke seminaries. In the wake of the Reformation and the Scientific Revolution, scholars gradually became less like clergymen; but until the 20th century their students were essentially gentlemen, who owed their admission as much to inherited status as to intellectual ability. Many of the great intellectual breakthroughs of the Enlightenment were achieved off campus. Only from the 19th century did academia become truly secularized and professional, with the decline of religious requirements, the rise to pre-eminence of the natural sciences, the spread of the German system of academic promotion (from doctorate up in steps to full professorship), and the proliferation of scholarly journals based on peer-review. Yet the same German universities that led the world in so many fields around 1900 became enthusiastic helpmeets of the Nazis in ways that revealed the perils of an amoral scholarship decoupled from Christian ethics and too closely connected to the state. Even the institutions with the most sustained records of excellence — Oxford and Cambridge — have had prolonged periods of torpor. F.M. Cornford could mock the inherent conservatism of Oxbridge politics in his “Microcosmographia Academica” in 1908. When Malcolm Bradbury wrote his satirical novel “The History Man” in 1975, universities everywhere were still predominantly white, male and middle class. The process whereby a college education became more widely available — to women, to the working class, to racial minorities — has been slow and remains incomplete. Meanwhile, there have been complaints about the adverse consequences of this process in American universities since Allan Bloom’s “Closing of the American Mind,” which was published back in 1987. Nevertheless, much had been achieved by the later years of the 20th century. There was a general agreement that the central purpose of a university was the pursuit of truth — think only of Harvard’s stark Latin motto: Veritas — and that the crucial means to that end were freedom of conscience, thought, speech and publication. There was supposed to be no discrimination in admissions, examinations and academic appointments, other than on the basis of intellectual merit. That was crucial to enabling Jews and other minority groups to take full advantage of their intellectual potential. It was understood that professors were awarded tenure principally to preserve academic freedom so that they might “dare to think” — Immanuel Kant’s other great imperative, Sapere aude! — without fear of being fired. The benefits of all this defy quantification. A huge proportion of the major scientific breakthroughs of the past century were made by men and women whose academic jobs gave them economic security and a supportive community in which to do their best work. Would the democracies have won the world wars and the Cold War without the contributions of their universities? It seems doubtful. Think only of Bletchley Park and the Manhattan Project. Sure, the Ivy League’s best and brightest also gave us the Vietnam War. But remember, too, that there were more university-based computers on the Arpanet — the original internet — than any other kind. No Stanford, no Silicon Valley. Those of us who were fortunate to be undergraduates in the 1980s remember the exhilarating combination of intellectual freedom and ambition to which all this gave rise. Yet, in the past decade, exhilaration has been replaced by suffocation, to the point that I feel genuinely sorry for today’s undergraduates. In Heterodox Academy’s 2020 Campus Expression Survey, 62% of sampled college students agreed that the climate on their campus prevented them from saying things they believed, up from 55% in 2019, while 41% were reluctant to discuss politics in a classroom, up from 32% in 2019. Some 60% of students said they were reluctant to speak up in class because they were concerned other students would criticize their views as being offensive. Such anxieties are far from groundless. According to a nationwide survey of a thousand undergraduates by the Challey Institute for Global Innovation, 85% of self-described liberal students would report a professor to the university if the professor said something that they found offensive, while 76% would report another student. In a study published in March entitled “Academic Freedom in Crisis: Punishment, Political Discrimination and Self-Censorship,” the Centre for the Study of Partisanship and Ideology showed that academic freedom is under attack not only in the U.S., but also in the U.K. and Canada. Three-quarters of conservative American and British academics in the social sciences and humanities said there is a hostile climate for their beliefs in their department. This compares to just 5% among left-wing faculty in the U.S. Again, one can understand why. Younger academics are especially likely to support dismissal of a colleague who has made some heretical utterance, with 40% of American social sciences and humanities professors under the age of 40 supporting at least one of four hypothetical dismissal campaigns. Ph.D. students are even more intolerant than other young academics: 55% of American Ph.D. students under 40 supported at least one hypothetical dismissal campaign. “High-profile deplatformings and dismissals” get the attention, the authors of the report conclude, but “far more pervasive threats to academic freedom stem … from fears of a) cancellation — threats to one’s job or reputation — and b) political discrimination.” These are not unfounded fears. The number of scholars targeted for their speech has risen dramatically since 2015, according to research by the Foundation for Individual Rights in Education. FIRE has logged 426 incidents since 2015. Just under three-quarters of them resulted in some kind of sanction — including an investigation alone or voluntary resignation — against the scholar. Such efforts to restrict free speech usually originate with “progressive” student groups, but often find support from left-leaning faculty members and are encouraged by college administrators, who tend (as Sam Abrams of Sarah Lawrence College demonstrated, and as his own subsequent experience confirmed) to be even further to the left than professors. There are also attacks on academic freedom from the right, which FIRE challenges. With a growing number of Republicans calling for bans on critical race theory, I fear the illiberalism is metastasizing. Trigger warnings. Safe spaces. Preferred pronouns. Checked privileges. Microaggressions. Antiracism. All these terms are routinely deployed on campuses throughout the English-speaking world as part of a sustained campaign to impose ideological conformity in the name of diversity. As a result, it often feels as if there is less free speech and free thought in the American university today than in almost any other institution in the U.S. To the historian’s eyes, there is something unpleasantly familiar about the patterns of behavior that have, in a matter of a few years, become normal on many campuses. The chanting of slogans. The brandishing of placards. The letters informing on colleagues and classmates. The denunciations of professors to the authorities. The lack of due process. The cancelations. The rehabilitations following abject confessions. The officiousness of unaccountable bureaucrats. Any student of the totalitarian regimes of the mid-20th century recognizes all this with astonishment. It turns out that it can happen in a free society, too, if institutions and individuals who claim to be liberal choose to behave in an entirely illiberal fashion.  How to explain this rapid descent of academia from a culture of free inquiry and debate into a kind of Totalitarianism Lite? In their book “The Coddling of the American Mind,” the social psychiatrist Jonathan Haidt and FIRE president Greg Lukianoff lay much of the blame on a culture of parenting and early education that encourages students to believe that “what doesn’t kill you makes you weaker,” that you should “always trust your feelings,” and that “life is a battle between good people and evil people.” However, I believe the core problems are the pathological structures and perverse incentives of the modern university. It is not the case, as many Americans believe, that U.S. colleges have always been left-leaning and that today’s are no different from those of the 1960s. As Stanley Rothman, Robert Lichter and Neil Nevitte showed in a 2005 study, while 39% of the professoriate on average described themselves as left-wing in 1984, the proportion had risen to 72% by 1999, by which time being a conservative had become a measurable career handicap. Mitchell Langbert’s analysis of tenure-track, Ph.D.-holding professors from 51 of the 66 top-ranked liberal arts colleges in 2017 found that those with known political affiliations were overwhelmingly Democratic. Nearly two-fifths of the colleges in Langbert’s sample were Republican-free. The mean Democratic-to-Republican ratio across the sample was 10.4:1, or 12.7:1 if the two military academies, West Point and Annapolis, were excluded. For history departments, the ratio was 17.4:1; for English 48.3:1. No ratio is calculable for anthropology, as the number of Republican professors was zero. In 2020, Langbert and Sean Stevens  found an even bigger skew to the left when they considered political donations to parties by professors. The ratio of dollars contributed to Democratic versus Republican candidates and committees was 21:1. Commentators who argue that the pendulum will magically swing back betray a lack of understanding about the academic hiring and promotion process. With political discrimination against conservatives now overt, most departments are likely to move further to the left over time as the last remaining conservatives retire. Yet the leftward march of the professoriate is only one of the structural flaws that characterize today’s university. If you think the faculty are politically skewed, take a look at academic administrators. A shocking insight into the way some activist-administrators seek to bully students into ideological conformity was provided by Trent Colbert, a Yale Law School student who invited his fellow members of the Native American Law Students Association to “a Constitution Day bash” at the “NALSA Trap House,” a term that used to mean a crack den but now is just a mildly risque way of describing a party. Diversity director Yaseen Eldik’s thinly veiled threats to Colbert if he didn’t sign a groveling apology — “I worry about this leaning over your reputation as a person, not just here but when you leave” — were too much even for an editorial board member at the Washington Post. Democracy may die in darkness; academic freedom dies in wokeness. Moreover, the sheer number of the administrators is a problem in itself. In 1970, U.S. colleges employed more professors than administrators. Between then and 2010, however, the number of full-time professors or “full-time equivalents” increased by slightly more than 50%, in line with student enrollments. The number of administrators and administrative staffers rose by 85% and 240%, respectively. The ever-growing army of coordinators for Title IX — the federal law prohibiting sex-based discrimination — is one manifestation of the bureaucratic bloat, which since the 1990s has helped propel tuition costs far ahead of inflation. The third structural problem is weak leadership. Time and again — most recently at the Massachusetts Institute of Technology, where a lecture by the University of Chicago geophysicist Dorian Abbot was abruptly canceled because he had been critical of affirmative action — academic leaders have yielded to noisy mobs baying for disinvitations. There are notable exceptions, such as Robert Zimmer, who as president of the University of Chicago between 2006 and 2021 made a stand for academic freedom. But the number of other colleges to have adopted the Chicago statement, a pledge crafted by the school’s Committee on Freedom of Expression, remains just 55, out of nearly 2,500 institutions offering four-year undergraduate programs. Finally, there is the problem of the donors — most but not all alumni — and trustees, many of whom have been astonishingly oblivious of the problems described above. In 2019, donors gave nearly $50 billion to colleges. Eight donors gave $100 million or more. People generally do not make that kind of money without being hard-nosed in their business dealings. Yet the capitalist class appears strangely unaware of the anticapitalist uses to which its money is often put. A phenomenon I find deeply puzzling is the lack of due diligence associated with much academic philanthropy, despite numerous cases when the intentions of benefactors have deliberately been subverted. All this would be bad enough if it meant only that U.S. universities are no longer conducive to free inquiry and promotion based on merit, without which scientific advances are certain to be impeded and educational standards to fall. But academic illiberalism is not confined to college campuses. As students collect their degrees and enter the workforce, they inevitably carry some of what they have learned at college with them. Multiple manifestations of “woke” thinking and behavior at newspapers, publishing houses, technology companies and other corporations have confirmed Andrew Sullivan’s 2018 observation, “We all live on campus now.” When a problem becomes this widespread, the traditional American solution is to create new institutions. As we have seen, universities are relatively long-lived compared to companies and even nations. But not all great universities are ancient. Of today’s top 25 universities, according to the global rankings compiled by the London Times Higher Education Supplement, four were founded in the 20th century. Fully 14 were 19th-century foundations; four date back to the 18th century. Only Oxford (which can trace its origins to 1096) and Cambridge (1209) are medieval in origin.  As might be inferred from the large number (10) of today’s leading institutions founded in the U.S. between 1855 and 1900, new universities tend to be established when wealthy elites grow impatient with the existing ones and see no way of reforming them. The puzzle is why, despite the resurgence of inequality in the U.S. since the 1990s and the more or less simultaneous decline in standards at the existing universities, so few new ones have been created. Only a handful have been set up this century: University of California Merced (2005), Ave Maria University (2003) and Soka University of America (2001). Just five U.S. colleges founded in the past 50 years make it into the Times’s top 25 “Young Universities”: University of Alabama at Birmingham (founded 1969), University of Texas at Dallas (1969), George Mason (1957), University of Texas at San Antonio (1969) and Florida International (1969). Each is (or originated as) part of a state university system. In short, the beneficiaries of today’s gilded age seem altogether more tolerant of academic degeneration than their 19th-century predecessors. For whatever reason, many prefer to give their money to established universities, no matter how antithetical those institutions’ values have become to their own. This makes no sense, even if the principal motivation is to buy Ivy League spots for their offspring. Why would you pay to have your children indoctrinated with ideas you despise? So what should the university of the future look like? Clearly, there is no point in simply copying and pasting Harvard, Yale or Princeton and expecting a different outcome. Even if such an approach were affordable, it would be the wrong one. To begin with, a new institution can’t compete with the established brands when it comes to undergraduate programs. Young Americans and their counterparts elsewhere go to college as much for the high-prestige credentials and the peer networks as for the education. That’s why a new university can’t start by offering bachelors’ degrees. The University of Austin will therefore begin modestly, with a summer school offering “Forbidden Courses” — the kind of content and instruction no longer available at most established campuses, addressing the kind of provocative questions that often lead to cancelation or self-censorship. The next step will be a one-year master’s program in Entrepreneurship and Leadership. The primary purpose of conventional business programs is to credential large cohorts of passive learners with a lowest-common-denominator curriculum. The University of Austin’s program will aim to teach students classical principles of the market economy and then embed them in a network of successful technologists, entrepreneurs, venture capitalists and public-policy reformers. It will offer an introduction to the world of American technology similar to the introduction to the Chinese economy offered by the highly successful Schwarzman Scholars program, combining both academic pedagogy and practical experience. Later, there will be parallel programs in Politics and Applied History and in Education and Public Service. Only after these initial programs have been set up will we start offering a four-year liberal arts degree.  The first two years of study will consist of an intensive liberal arts curriculum, including the study of philosophy, literature, history, politics, economics, mathematics, the sciences and the fine arts. There will be Oxbridge-style instruction, with small tutorials and college-wide lectures, providing an in-depth and personalized learning experience with interdisciplinary breadth.   After two years of a comprehensive and rigorous liberal arts education, undergraduates will join one of four academic centers as junior fellows, pursuing disciplinary coursework, conducting hands-on research and gaining experience as interns. The initial centers will include one for entrepreneurship and leadership, one for politics and applied history, one for education and public service, and one for technology, engineering and mathematics. To those who argue that we could more easily do all this with some kind of internet platform, I would say that online learning is no substitute for learning on a campus, for reasons rooted in evolutionary psychology. We simply learn much better in relatively small groups in real time and space, not least because a good deal of what students learn in a well-functioning university comes from their informal discussions in the absence of professors. This explains the persistence of the university over a millennium, despite successive revolutions in information technology. To those who wonder how a new institution can avoid being captured by the illiberal-liberal establishment that now dominates higher education, I would answer that the governance structure of the institution will be designed to prevent that. The Chicago principles of freedom of expression will be enshrined in the founding charter. The founders will form a corporation or board of trustees that will be sovereign. Not only will the corporation appoint the president of the college; it will also have a final say over all appointments or promotions. There will be one unusual obligation on faculty members, besides the standard ones to teach and carry out research: to conduct the admissions process by means of an examination that they will set and grade. Admission will be based primarily on performance on the exam. That will avoid the corrupt rackets run by so many elite admissions offices today. As for our choice of location in the Texas capital, I would say that proximity to a highly regarded public university — albeit one where even the idea of establishing an institute to study liberty is now controversial — will ensure that the University of Austin has to compete at the highest level from the outset. My fellow founders and I have no illusions about the difficulty of the task ahead. We fully expect condemnation from the educational establishment and its media apologists. We shall regard all such attacks as vindication — the flak will be a sign that we are above the target. In our minds, there can be no more urgent task for a society than to ensure the health of its system of higher education. The American system today is broken in ways that pose a profound threat to the future strength and stability of the U.S. It is time to start fixing it. But the opportunity to do so in the classic American way — by creating something new, actually building rather than “building back” — is an inspiring and exciting one. To quote Haidt and Lukianoff: “A school that makes freedom of inquiry an essential part of its identity, selects students who show special promise as seekers of truth, orients and prepares those students for productive disagreement … would be inspiring to join, a joy to attend, and a blessing to society.” That is not the kind of institution satirized in “The Chair.” It is precisely the kind of institution we need today. *  *  * Niall Ferguson is the Milbank Family Senior Fellow at the Hoover Institution at Stanford University and a Bloomberg Opinion columnist. He was previously a professor of history at Harvard, New York University and Oxford. He is the founder and managing director of Greenmantle LLC, a New York-based advisory firm. His latest book is "Doom: The Politics of Catastrophe." Tyler Durden Wed, 11/10/2021 - 22:05.....»»

Category: smallbizSource: nytNov 10th, 2021

Daniel Schlaepfer: “There Is No Such Thing As Free Day Trading”

High on the list of all the trends, habits, and businesses that the pandemic changed or helped boost, is day trading. Cerulli Associates asserts that during the peak of the pandemic in April 2020, the activity increased dramatically when compared to the same period the previous year. Q3 2021 hedge fund letters, conferences and more […] High on the list of all the trends, habits, and businesses that the pandemic changed or helped boost, is day trading. Cerulli Associates asserts that during the peak of the pandemic in April 2020, the activity increased dramatically when compared to the same period the previous year. .first{clear:both;margin-left:0}.one-third{width:31.034482758621%;float:left;margin-left:3.448275862069%}.two-thirds{width:65.51724137931%;float:left}form.ebook-styles .af-element input{border:0;border-radius:0;padding:8px}form.ebook-styles .af-element{width:220px;float:left}form.ebook-styles .af-element.buttonContainer{width:115px;float:left;margin-left: 6px;}form.ebook-styles .af-element.buttonContainer input.submit{width:115px;padding:10px 6px 8px;text-transform:uppercase;border-radius:0;border:0;font-size:15px}form.ebook-styles .af-body.af-standards input.submit{width:115px}form.ebook-styles .af-element.privacyPolicy{width:100%;font-size:12px;margin:10px auto 0}form.ebook-styles .af-element.privacyPolicy p{font-size:11px;margin-bottom:0}form.ebook-styles .af-body input.text{height:40px;padding:2px 10px !important} form.ebook-styles .error, form.ebook-styles #error { color:#d00; } form.ebook-styles .formfields h1, form.ebook-styles .formfields #mg-logo, form.ebook-styles .formfields #mg-footer { display: none; } form.ebook-styles .formfields { font-size: 12px; } form.ebook-styles .formfields p { margin: 4px 0; } Get The Full Ray Dalio Series in PDF Get the entire 10-part series on Ray Dalio in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues (function($) {window.fnames = new Array(); window.ftypes = new Array();fnames[0]='EMAIL';ftypes[0]='email';}(jQuery));var $mcj = jQuery.noConflict(true); Q3 2021 hedge fund letters, conferences and more Bored at home and dealing with severe lockdowns, thousands of people turned to day trading apps to compensate for the loss of income, or simply to try their luck at big gains. During this time, applications like eToro and Robinhood Markets Inc (NASDAQ:HOOD) increased their online ads spending. The success of day trading was such that this year will have seen the public listing of both companies, with Robinhood’s already taking place in July, and eToro’s due in the fourth quarter. As more people engage in trading activity, we talked to Daniel Schlaepfer, President and CEO of global market-making firm Select Vantage Inc. (SVI) to discuss the exponential growth of day trading and the regulatory measures that need to be taken to ensure fair trading. In your view, what has caused day trading to become a more prominent feature of financial news headlines this year? It’s really been a mixture of things. The pandemic put the spotlight on day trading –both amateur and professional– for several reasons. The market volatility it brought about made trading riskier and therefore more exciting and more profitable for professional day traders, at least for some. It’s also true that public interest in amateur day trading increased because many people had lost a stable source of income and were spending more time at home. But I also think it goes deeper than this. We’re reaching a point in human history in which technology is providing almost anyone with the opportunity to control their financial welfare –or at least try to. Naturally, that is very alluring. I think greater access to public markets is a good thing, but that doesn’t mean that everyone will be successful. What is the best way to learn how to day trade? I won’t try to hide my bias. I think the best way to learn is to undergo professional training in a simulator before you trade with real capital, which is what my firm’s traders have to do before they can trade the firm’s capital. Of course, not everyone wants to be a professional day trader. You can learn through practice by trading on apps, but you might learn the hard way by losing your money. I also won’t hide my bias in recommending TraderTV.live –a show sponsored by my firm which I am an executive director of– which talks about trends and strategies in real time. It’s the biggest day trading show on YouTube, and bias aside, I’ve heard from many amateur traders that it’s helped them better understand and analyse the markets. Do you agree with the view that amateur day trading has undergone a process of ‘gamification,’ making it both more attractive and risker to retail investors? I think it’s fair to say or at least to speculate that the illusion of “free trading” created by commission-free trading apps has caused a significant proportion of retail investors to treat trading like a game, rather than an investment practice that requires skill and experience, and which involves real losses as well as potential gains. The reality is that there is no such thing as free trading. The practice of Payment-For-Order-Flow (PFOF) enables brokerages like Robinhood to sell customers' buy and sell orders to wholesalers. So, brokers generate revenue by offering zero-commission trading to retail investors when commissions are in fact being subsidized by wholesalers. When something is free, human nature tends to undervalue it. What is your assessment of the SEC’s recent report on the so-called meme stock trading controversy (formally titled ‘Staff Report on Equity and Options Market Structure Conditions in Early 2021’)? It was comprehensive, but not particularly conclusive. Though it warned of the danger of PFOF, it stopped short of banning the practice outright, which I think was a missed opportunity. Doing so would give investors access to the better pricing of a perfect market. Access fees would become transparent and so properly factored into trading decisions. All investors would reap the full efficiencies of the market and correspondingly pay the true cost of facilitating trades. In turn, the fact of incurring this cost would likely deter small retail investors from indulging in risky gamification. From the market’s perspective, what should financial regulators do to ensure the fairest and most competitive trading environment? That’s a complicated question, and the reason for that is that financial regulation is generally too complicated in my view. Simply put, I think good regulation is regulation that is simple, easy to understand and easy to implement. You have previously argued that the cost of complying with financial regulation is too high. Why is this and what could be done to reduce its costs? After the financial crash there naturally emerged a consensus that more regulation was needed to prevent a repeat of the ‘too big to fail’ culture. Since then we’ve seen broad, ambitious, and all-encompassing regulation like Dodd-Frank and more recently MiFID II come into play. While this might all have been well intended, it also became extremely expensive for firms to implement, especially small firms. As such, many small to medium sized firms have been priced out of the market because of regulation. In other words they became “too small to comply.” I’ve been arguing for some time now that the priority for regulators around the world needs to be about bringing down the hidden costs of compliance. You have been involved in litigation proceedings with financial regulators –what was the incentive behind your actions? Yes, that's true. In 2016 I decided to sue the Australian Securities and Investments Commission (ASIC) for defamation. I learnt that they had communicated unfounded suspicions to other market participants that traders at my firm had engaged in market manipulation, which damaged our business. What was the outcome of this litigation? The judge found that I had been defamed, but defensively so. In other words, it was found that no market manipulation had taken place, and that in retrospect the regulator acted wrongly, but that they had the right to act as they did at the time in light of their ultimately ill-founded suspicions. For me that constitutes a moral victory, so it was worthwhile. The judgement stated that, although the appeal outcome didn’t go my way, I was successful on most issues, including the vindication of my reputation. I issued a statement in July manifesting concerns about the fact that ASIC's defence of qualified privilege could set a dangerous precedent for financial regulation. This shows how regulators can act with impunity and cause great reputational damage that could account for financial losses to market participants. How can understanding between market participants and financial regulators be improved and made more efficient? I think communication between regulators and market participants needs to be improved at all levels. I currently sit on the Market Structure Advisory Committee (MSAC) of The Ontario Securities Commission (OSC), which is a great forum for this. What does the future hold for the day trading industry and who stands to benefit the most from increased interest in day trading, whether amateur or professional? I think public interest in trading stocks will only continue to increase, and with time the public will only become better informed. Ultimately I’d like to think the health of the market will be the ultimate beneficiary, as public access means greater liquidity. Updated on Nov 9, 2021, 4:45 pm (function() { var sc = document.createElement("script"); sc.type = "text/javascript"; sc.async = true;sc.src = "//mixi.media/data/js/95481.js"; sc.charset = "utf-8";var s = document.getElementsByTagName("script")[0]; s.parentNode.insertBefore(sc, s); }()); window._F20 = window._F20 || []; _F20.push({container: 'F20WidgetContainer', placement: '', count: 3}); _F20.push({finish: true});.....»»

Category: blogSource: valuewalkNov 9th, 2021