Reaction To BlackRock CEO Larry Fink Letter

Leading Advocate for Corporate Social Impact Professionals Responds to Blackrock CEO Larry Fink Letter to Investors “Larry Fink’s letter says more about today’s toxic political environment than it does about BlackRock Inc (NYSE:BLK) or the ongoing commitment to corporate and environmental impact in boardrooms across the globe,” said Carolyn Berkowitz, president and CEO of ACCP. […] Leading Advocate for Corporate Social Impact Professionals Responds to Blackrock CEO Larry Fink Letter to Investors “Larry Fink’s letter says more about today’s toxic political environment than it does about BlackRock Inc (NYSE:BLK) or the ongoing commitment to corporate and environmental impact in boardrooms across the globe,” said Carolyn Berkowitz, president and CEO of ACCP. if (typeof jQuery == 'undefined') { document.write(''); } .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 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 Our Activist Investing Case Study! Get the entire 10-part series on our in-depth study on activist investing in PDF. Save it to your desktop, read it on your tablet, or print it out to read anywhere! Sign up below! (function($) {window.fnames = new Array(); window.ftypes = new Array();fnames[0]='EMAIL';ftypes[0]='email';}(jQuery));var $mcj = jQuery.noConflict(true); Q4 2022 hedge fund letters, conferences and more   ACCP's Reaction To BlackRock CEO Larry Fink Letter Fairfax, VA – Carolyn Berkowitz, president and CEO of the Association of Corporate Citizenship Professionals (ACCP), the nation’s leading advocate for corporate social impact professionals, released the following statement in response to Blackrock CEO Larry Fink’s letter to investors and chief executives: “Larry Fink’s letter says more about today’s toxic political environment than it does about Blackrock or the ongoing commitment to corporate and environmental impact in boardrooms across the globe.  A recent KPMG survey of U.S. CEO’s found that 70 percent said their ESG programs improved their financial performance. “As the leading advocate for corporate social impact professionals, the frontline practitioners in the field of corporate social responsibility, the reality on the ground is that the value of their work has never been more important to their stakeholders - employees, customers, investors, and the communities in which they operate - and the long-term success of companies.” From the KPMG report: "With the potential recession testing CEOs’ commitment to their ESG strategies, reducing investment may lead to long-term financial risks. This test comes at a time when CEOs have made significant strides in tying ESG to profitability, with 70% of U.S. CEOs saying that ESG improves financial performance, compared to 37% last year." About the ACCP The Association of Corporate Citizenship Professionals (ACCP) is the preeminent membership organization advancing the practice of corporate social impact. ACCP increases the effectiveness of CSR & ESG professionals and their companies by sharing knowledge, fostering solutions, and cultivating inclusive and supportive peer communities. ACCP amplifies the voices of its practitioner network to elevate strategies that work, provide innovative solutions, and expand impact......»»

Category: blogSource: valuewalkMar 18th, 2023

The Big Collapse And What To Do About It

Silicon Valley Bank implodes… The dreaded chain reaction… This is the end of Silicon Valley as we know it… Silicon Valley Bank Implodes The Fed finally broke something big. In its ongoing effort to cool inflation, the Fed hiked interest rates at its fastest pace in decades over the past year. And now, things are […] Silicon Valley Bank implodes… The dreaded chain reaction… This is the end of Silicon Valley as we know it… Silicon Valley Bank Implodes The Fed finally broke something big. In its ongoing effort to cool inflation, the Fed hiked interest rates at its fastest pace in decades over the past year. And now, things are unraveling quickly… if (typeof jQuery == 'undefined') { document.write(''); } .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 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 Henry Singleton Series in PDF Get the entire 4-part series on Henry Singleton 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); Q4 2022 hedge fund letters, conferences and more   On Friday, Silicon Valley Bank (NASDAQ:SIVB)—America’s 16th-largest bank and a massive player in the venture capital world—went under. It marks the second-biggest bank failure in US history, second only to Washington Mutual in 2008. What happened? Over the last year, surging interest rates eroded the value of banks’ bond portfolios. SVB was especially vulnerable because of 1) poor management and 2) its unique customer base. SVB’s customers were concentrated in venture capital/startup companies—which tend to be deeply cash flow negative. Its customers burned through more and more cash, withdrawing more and more money from the bank. This came to a head last week when SVB was forced to sell billions of dollars’ worth of bonds­—mostly US Treasurys­—at huge losses, triggering panic. Venture capital advisors urged their customers to take their money out of SVB, igniting a bank run. Regulators closed down the bank for good on Friday. There are a lot of important angles to this. In fact, I believe this marks the end of Silicon Valley as we know it. But for today… let’s go over the most urgent implications for your money. FDIC Has Got Your Back Your money in your bank is probably safe. Up until yesterday, the rules were clear. The Federal Deposit Insurance Corporation (FDIC) guaranteed deposits of up to $250,000 per depositor per US bank. If your bank shuts down tomorrow, the FDIC ensures you get your money back, up to $250,000. Above that amount, you might lose money. According to Barron’s, 87% of SVB’s deposits were above $250,000, and therefore at risk. As any corporate treasurer knows, there were ways to extend this coverage. You could spread your money across multiple accounts, for example. If you have $2.5 million and put 1/10th into 10 different banks, it’s all insured. But by the looks of it, there’s no longer a need to do any of that. Because over the weekend, the Feds changed the rules. Here’s Barron’s: In essence, Federal Deposit Insurance Corporation protection—usually limited to $250,000 per account—became unlimited. Additionally, the Federal Reserve created a new program to help protect other banks from depositor flight. This is a HUGE deal. Guaranteeing all deposits should go a long way toward stemming this crisis. It’ll make SVB depositors whole. And it’ll stop most folks from running to their bank to pull out their cash. But a government changing rules on the fly sets a dangerous precedent. Not only does it introduce uncertainty and spur questions about why we have these rules at all... It sows the seeds of an even bigger crisis because it shields the people who made mistakes from their consequences. Worries About Regional Banks Everyone is worried about a chain reaction… The problem with bank runs is they spread. They shatter confidence and make investors wonder: Could this happen to my bank? At the time of writing, the latest news is New York regulators shut down Signature Bank—a crypto-focused bank—due to these concerns. And First Republic, another big bank, looks to be in trouble as well. At one point, its stock went down 60% in pre-market trading. The chart of KRE—a regional bank ETF—looks awful: I wouldn’t be surprised if more regional banks fail. Don't Believe The Media Here’s my rule for highly emotional times like this… Think independently. Remember, the media’s job is to scare you. Of course, they’re saying this is 2008 all over again. Their ratings shot through the roof in 2008. But the reality is, the end-of-the-world narrative is NOT being reflected in asset prices. Outside of regional banks and Silicon Valley, markets are holding up well. The S&P 500 and the Nasdaq are up slightly on the year. Bitcoin and Ethereum—two of the most speculative assets—are holding up fine. And many global stock markets—like the UK, France, Denmark, and Australia—are a hair off all-time highs. Ask yourself: How bad could things really be if the UK’s stock market is near record highs?   A Crash Is Unlikely And the #1 reason I doubt this crisis will crash the stock market is… The weakness in the US dollar. For reasons we’ve discussed many times, the US dollar is the ultimate “canary in the coal mine.” It ALWAYS spikes during big crises... It spiked in 2001, 2008, and even leading up to the difficult year that was 2022. But today? The dollar is down more than 2% since March 8: Bottom line: The failure of SVB is a big deal for the banking sector and Silicon Valley. But there’s a complete lack of evidence that it’s going to crash the stock market. Unless you count media headlines as evidence… which I most definitely do not. Article by Stephen McBride - Chief Analyst, RiskHedge To get more ideas like this sent straight to your inbox every Monday, Wednesday, and Friday, make sure to sign up for The RiskHedge Report, a free investment letter focused on profiting from disruption. Expect smart insights and analysis on the latest breakthrough technologies, the big stories the mainstream media isn't reporting on, and much more... including actionable recommendations. Click here to sign up......»»

Category: blogSource: valuewalkMar 23rd, 2023

Meta"s big job cuts aren"t about the tricky economy or rising inflation. They"re about Mark Zuckerberg"s mistakes.

Mark Zuckerberg blames the economy for his company's workforce problems, but investors have always blamed Meta and its CEO. Mark Zuckerberg says the economy and competitive pressure has hurt its growth. Investors say it was Zuck's own decisions that led to Tuesday's sweeping job cuts.Getty Images Meta laid off 10,000 staff on Wednesday, adding to its November job cuts. CEO Mark Zuckerberg said it was economic changes that led to over 21,000 in total being laid off. Investors have long said that Zuckerberg's own decisions and mistakes led to this point. Meta CEO Mark Zuckerberg sent a letter to staff announcing a second round of layoffs on Tuesday, just months after its last round of big job cuts.The memo said that 10,000 more workers would be let go, in addition to the 11,000 that were handed a pink slip starting in November. What's more, 5,000 open roles would be closed, showing just how serious the company is about slimming down their workforce and reducing operating costs overall. In the note, also shared on Facebook, Zuckerberg blamed the most recent state of the economy: "Last year was a humbling wake-up call. The world economy changed, competitive pressures grew, and our growth slowed considerably." He continued: "Higher interest rates lead to the economy running leaner, more geopolitical instability leads to more volatility, and increased regulation leads to slower growth and increased costs of innovation."But investors had been asking Meta to have that "humbling wake-up call" for a while — as early as the second quarter of 2022, when Wall Street noticed the social networking giant's revenue was shrinking even as its employee headcount continued to rise.  Last October, two weeks before reports surfaced that Meta was cutting jobs, shareholder Altimeter Capital's CEO Brad Gerstner penned an open letter to the social network giant requesting that it reduce headcount by 20% and cut back on overall spending, including its multi-billion dollar investments in the metaverse.Zuckerberg has bet his company's future on the metaverse, including its expensive bets on virtual reality goggles via its Reality Labs unit. But those efforts have yet to materialize into actual revenue for the company, even as it spends billions on research and development. Investors have begun calling for Zuckerberg to hedge those bets."Like many other companies in a zero rate world — Meta has drifted into the land of excess — too many people, too many ideas, too little urgency," wrote Gerstner last year.Meta's stock has moved up after every layoff announcement, a sign that investors liked the announcements. Last November, after suffering a price drop following its disappointing third quarter earnings where profits slid 52% year-over-year on declining revenue and metaverse expenses, causing Meta's stock to fall more than 20%, news of layoffs put a pep back in investors' step as the stock price rose 6%. Evercore head of internet research Mark Mahaney said in a note to investors that Meta and Zuckerberg seemed to have heard the "negative investor reaction to perceived lack of cost discipline" during its third-quarter earnings results because they are pivoting in a less costly direction. Investors had a positive response on Wednesday as Meta's stock rose 6% again off the news of more layoffs. And the fact that Meta's Reality Labs are included in this most recent round of layoffs is apparently music to some investors' ears, according to an AllianceBernstein investor note by tech specialist Mark Schilsky."That's very important for a lot of reluctant shareholders who have shied away from Meta's stock because they didn't feel comfortable underwriting the risk that Zuckerberg was going to spend an ever increasing amount of money on the Metaverse," he wrote.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderMar 14th, 2023

Rep. Greene To Lead GOP Visit To Jan. 6 Defendants In DC Jail

Rep. Greene To Lead GOP Visit To Jan. 6 Defendants In DC Jail Authored by Gary Bai via The Epoch Times (emphasis ours), Republican lawmakers sitting on the House Oversight Committee are planning to visit the jail holding Jan. 6 defendants in Washington, D.C., multiple media outlets confirmed. U.S. Rep. Marjorie Taylor Greene (R-Ga.) waits to speak during a news conference outside the U.S. Capitol in Washington on Feb. 1, 2023. (Drew Angerer/Getty Images) Rep. Marjorie Taylor Greene (R-Ga.) and Rep. James Comer (Ky.), who both sit on the committee, told media outlets on Wednesday that they are intending to organize a trip to the Central Detention Facility to visit defendants who were criminally charged for their involvement in the Jan. 6 Capitol breach. A spokesperson for Comer confirmed with Fox News that Greene is leading the effort. Greene told ABC that she would send a letter this week to congressional lawmakers to begin the scheduling process for the visit. Comer told The Hill that the visit is “not high on [his] list” and he will see what his schedule looks like. The Epoch Times contacted Greene’s and Comer’s offices for comment. Tucker Carlson Airs Footage It comes two days after House Speaker Kevin McCarthy (R-Calif.) released more than 40,000 hours of Jan. 6 footage to Fox News’s Tucker Carlson, who then aired some of the footage on his show on Monday and Tuesday. One tape aired Monday showed Capitol Police officers walking alongside Jacob Chansley, a Jan. 6 defendant serving a 41-month sentence after pleading guilty to an obstruction charge. Chansley was unarmed and walked past several Capitol police officers. Jacob Chansley, center, and other protesters are seen inside the U.S. Capitol in Washington on Jan. 6, 2021. (Manuel Blace Ceneta/AP Photo) Another showed Capitol Police officer Brian Sicknick giving directions inside the Capitol apparently after clashing with protestors, which Carlson said casted doubt on the mainstream narrative that Sicknick died of a head injury. The aired tapes have caused an uproar in the media and in Congress. Republicans have had mixed reactions to the tape release, while virtually all Democrats condemned the release and Fox News’s coverage of the tapes. Greene said in reaction to the tapes’ airing that Democrats had lied to the American people and that they “had people in place to make” the Capitol breach happen. “The Democrats that support Antifa terrorism, lied about Covid and locked down America, ripped our borders wide open to Mexican Cartel terrorism and daily fentanyl murder of Americans, were the ones who did not place the National Guard at the Capital on J6 when they knew the intelligence because they had people in place to make it happen,” Greene wrote in a Twitter post on March 7, citing Tucker Carlson’s Monday Segment. “Then they blamed all of us for the breach of the Capital and have tortured American citizens as political prisoners.” “You don’t get to ignore Antifa anarchists and terrorism on one hand and be all about justice for J6 on the other,” she said in another post. Since Jan. 6, 2021, more than a thousand Americans have been arrested and charged with crimes related to the Capitol breach, according to a March 8 statement published by the U.S. Attorney’s office in D.C. These include more than 320 individuals charged with assaulting or impeding law enforcement, the statement reads. People at the Save America rally in Washington on Jan. 6, 2021. (Shao Lin/The Epoch Times) ‘Human Rights Abuse’ The visit is partially to see the conditions of the Washington facility, Greene told The Hill. “They’re pretrial, and they haven’t even been convicted, and they’re not allowed to see their families, many times are not allowed to see their attorneys. The food has been a major complaint,” Greene told the outlet. “There’s been complaints of it tasting like cleaner.” “We’re going to be addressing the human rights abuse, such as the fact that they’ve been held in solitary confinement up to 23 hours a day, denied the ability to see their families,” Greene said. A November 2021 inspection report published by U.S. Marshals Service found “systematic failures” in the conditions of confinement at the Washington jail. Observed violations of civil rights include “overpowering” smells of urine and sewage, punitive withholding of food and water, lack of attentiveness to “observable injuries” on prisoners, and intentional antagonization of prisoners, U.S. Marshal Lamont Ruffin wrote in the report. The Epoch Times has contacted the Washington Central Detention Facility for comment. “As prisoners of this Jail, we have witnessed the horrendous treatment and have been personally afflicted by the hellacious conditions this Jail insists on tormenting its traumatized guests with,” reads a letter written by some of the Jan. 6 defendants in prison. “A more accurate terminology to describe the facility … would be to call this location an ‘evisceration facility,’ of the body, mind, and soul.” Tyler Durden Fri, 03/10/2023 - 19:40.....»»

Category: personnelSource: nytMar 10th, 2023

Founders Fund, Other VCs Advise Companies To Pull Cash From SVB

Founders Fund, Other VCs Advise Companies To Pull Cash From SVB Update (1730ET): SVB must have seriously upset someone... Founders Fund, the venture capital fund co-founded by Peter Thiel, has reportedly advised companies to pull money from Silicon Valley Bank.. The firm told portfolio companies that there was no downside to removing their money from the bank, according to the people, who asked not to be identified because the information isn’t public. Additionally, Bloomberg reports that Garry Tan, the president and CEO of Y Combinator, warned its network of startups that solvency risk is real and implied they should consider limiting their exposure to the lender. “We have no specific knowledge of what’s happening at SVB,” Tan wrote in a post viewed by Bloomberg News.  “But anytime you hear problems of solvency in any bank, and it can be deemed credible, you should take it seriously and prioritize the interests of your startup by not exposing yourself to more than $250K of exposure there.” He added, “Your startup dies when you run out of money for whatever reason.” Venture firm Tribe Capital has advised its portfolio companies to move some, if not all, of their balances from SVB.  “What’s important to understand is that banks all have leverage and they use deposits, so almost by definition any bank with a business model is dead if everyone moves,” Tribe co-founder Arjun Sethi told portfolio companies in communication reviewed by Bloomberg. “Since risk is non-zero and the cost it tiny, better to diversify your risk if not all,” he added. An email thread of more than 1,000 founders from Andreessen Horowitz was abuzz with the news Thursday, with many encouraging each other to pull cash from the bank. SIVB shares down further after hours (-70%), back below $80... A cunning plan perhaps -  numerous VC icons potentially ganging up to crush a midsize bank  - which could be systemic. What better way to force Powell back into QE to 'save the world'?   *  *  * Update (1500ET): As the day wore on and SIVB shares collapsed (and fear spread contagiously across other banks and asset-classes), The Information reports that Silicon Valley Bank CEO Greg Becker on Thursday told top venture capitalists in Silicon Valley to “stay calm” amid concerns around a capital crunch that wiped nearly $10 billion off the bank’s market valuation. “I would ask everyone to stay calm and to support us just like we supported you during the challenging times,” he said. On a call, Becker said that “calls started coming and started panic.” He added that the bank has “ample liquidity to support our clients with one exception: If everyone is telling each other SVB is in trouble that would be a challenge.” Haven't we heard that kind of reassurance before? *  *  * Is the bursting of the tech bubble finally spilling over to the financial system? One day after the biggest crypto-focused bank, Silvergate Capital, announced plans to unwind and liquidate after a deposit run effectively killed its core business model, this morning its far larger peer - the parent company of the venerable Silicon Valley Bank, SVB Financial Group - saw its shares plunge the most in more than two decades after the company took "steps to bolster its financial position" that included not only a highly dilutive stock offering but also a panicked asset sale that sparked fears of a liquidity crisis at one of the biggest and original providers of funding to the Venture Capital industry. The Santa Clara-based company’s shares sank by as much as 60% on Thursday, their biggest decline in the company's history since going public in 1987. The slump in the shares to their lowest level since May 2020, came after SVB i) announced a stock offering, ii) sold substantially all of the available-for-sale securities in its portfolio and iii) updated its forecast for the year to include a sharper decline in net interest income. Put in context, this 60% plunge smashes SIVB back to its lowest since 2016... “While we view these actions combined with a weaker guide as a clear negative, we do not believe that SIVB is in a liquidity crisis, especially following the significant proceeds” from its sale of securities, Wedbush analyst David Chiaverini wrote as he cut his price target for the company to $200 from $250. Others clearly disagreed and dumped the stock at a pace not seen in a quarter century. The bank also said it had sold about $21 billion of securities from its portfolio (with a plan to reinvest the proceeds but don't hold your breath) which will result in an after-tax loss of $1.8 billion for the first quarter. And the cherry on top was SVB's announcement of equity offerings for $1.25 billion of its common stock and $500 million of securities that represent convertible preferred shares. Additionally, General Atlantic committed to purchase $500 million of common stock, taking the total amount being raised to about $2.25 billion. It wasn't immediately clear whether the SIVB liquidity crisis is a function of assets, i.e., loans collateralized by toxic early stage investments that have turned sour... or liabilities, i.e., a good old-fashioned deposit bank run. “The improved cash liquidity, profitability and financial flexibility resulting from the actions we announced today will bolster our financial position and our ability to support clients through sustained market pressures,” the company said in a letter to stakeholders but judging by the stock reaction, nobody believed it. Multiple analysts have pointed to the high deposit outflows as the catalyst for the liquidity sale, which stoked fears for the banking industry as a whole. Truist analyst Brandon King says “the increase in balance sheet asset sensitivity should lower the left tail risk to higher interest rates” but expects material value per share dilution from the proposed capital raise.” “The proceeds from the sale are expected to be reinvested into short duration US treasuries along and hedged with receive floating swaps” KBW analyst Christopher McGratty says SVB Financial will exit 2023 on a notable lower earnings run rate due (NII and share count), and “it’s possible that 2024E is in the $16.00-$18.00/share range” pending the price of the capital raise SVB Financial sold $21B of securities to better manage liquidity, in light of accelerated deposit outflows For the broader sector, “balance sheet management for the group is unquestionably front and center” and it’s possible that banks with “more volatile/flightly deposits” could trade lower on this news. Namely, SBNY and PACW Evercore ISI analyst John Pancari: “We favor SIVB’s strategy to shore up liquidity and reposition the balance sheet for increased asset sensitivity, particularly in lieu of the Fed’s more hawkish recent tone” Management’s updated outlook reveals incrementally weaker deposit dynamics – an output of more resilient than expected client cash burn trends, and the likely catalyst of the move Jefferies analyst Casey Haire says the balance sheet restructuring and capital raise will boost net interest income and nudge capital ratios higher... ...but also reveal that SVB Financial’s ecosystem is still challenged due to higher for longer interest rates and a surprise pick-up in client cash burn Also notes the updated 2023 guidance that implies EPS of ~$15 against consensus of $19 Bloomberg Intelligence analyst Herman Chan notes the sale “comes as a surprise considering the bank’s ability to source off-balance-sheet client funds for deposit funding” To ease the hit, SVB will raise $2.25 billion through common stock, depositary shares and a sale of shares to General Atlantic In an earlier note, Chan notes that “SVB is sitting on a $15 billion unrealized loss position in its $91 billion held-to-maturity securities portfolio” $SIVB $SIVBP You can see $15.1 billion of unrealized losses on the HTM vs. $1.3 at 2021. This is all MBS and its toasted more now than at 12/31/22. Average yield on this book is a mere ~190 bps. They can't sell this. They are frozen. — Lake Cornelia Research Management (@CorneliaLake) March 9, 2023 As Lake Cornelia Research Management goes on to note, the market implications of this situation are far and wide.   We have a $210+ billion balance sheet (which was a mere 86 billion 2 years ago) that could well have an unwind.  It is not a stretch at all to argue that on a current mark to market basis that equity is negative to the tune of of billions (you can be insolvent but liquid and survive as a bank).  The hit to the startup eco-system of an impaired or vanquished $SIVB would be substantial.   Beyond the negative duration risk we highlighted (asset side locked at sub 200 bps vs. liability side could increase to 200+), the simple mark to market on the HTM and the $88 billion of HTM and $70 billion of loans is likely far greater than the realized losses on the AFS securities sold at a $1.8 billion loss.  The asset growth since 2020 is crazy.  Total assets for $SIVB are 50% of $BSC at time of $JPM bid.   We do not believe it would be crazy to see $SIVB at $50 or lower per share when this is all done.  The negative earnings loop, and associated balance sheet pressure, of higher deposit rates plus potential for fleeing private bank clients is a dark scenario.  There are many scenarios where they will need to raise more capital (dilution to existing holders) and this may not have fixed the situation.      We have rarely seen a situation where buying a bank when it is down 40% on the day to be a good entry...these things can unwind far quicker than people realize.  People with facilities with $SIVB may well call them / draw which would further stress liquidity.  Just haircutting by 10% the value of the 21-22 growth of held loans and HTM securities alone would be a $5+ billion hit to book equity (which is ~$20 billion post these transactions).  The GA concurrent PIPE we think was the wrong investor.  If there was ever a situation to bring in an "Elliot" / "Baupost" / $GS "Prop Desk" it was this one.  The balance sheet needs to be seen as credible and diligenced.  The earnings and conference call transcripts are farcical; the CEO talks about the VC funding environment and IPO pipeline as opposed to any questions on the balance sheet position.  If this plays out adversely, it will be another sad case of a storied franchise that had a great moat..and then woke up during the $ARKK boom and decided to blow it all on a $140+ billion balance sheet growth splurge on a mortgage and loan book yielding a blended ~3.25% with massive correlation risk...which ran right into rising interest rates.    Seeing the preferred stock trade down 15% today should be eye opening to many.  It is at $16.60.  This is distress debt mafia stuff.  Par is $25 for reference.   Lot of digging to do and all the above could well be wrong.  Many / most people far smarter than I am on fins (and other things).  The point is we don't think this is over and there are a lot of second and third order implications. Tyler Durden Thu, 03/09/2023 - 17:27.....»»

Category: smallbizSource: nytMar 9th, 2023

The Justice Department investigated Jeffrey Epstein"s death. Then it went silent.

Jeffrey Epstein's victims — and his brother — are still waiting for answers from the DOJ inspector general, more than three years later. The Justice Department's Office of Inspector General launched an investigation after Jeffrey Epstein was found dead. But more than three years later, the office still hasn't released its report.New York State Sex Offender Registry via AP, File; Rebecca Zisser/Insider Jeffrey Epstein's death in a federal jail was seen as a shocking Justice Department failure. Over three years later, the DOJ inspector general hasn't released the results of its investigation. Epstein's accusers — and his brother — still want answers. On October 28, 2019, two months after his brother's death, Mark Epstein was summoned to the US Attorney's office in downtown Manhattan.Jeffrey Epstein died in the custody of a federal jail just one building over, and officials at the Justice Department said they had an update for Mark on their investigation into his death. Mark showed up with a lawyer and Michael Baden, a forensic pathologist he hired to examine Jeffrey's body. Baden believed Jeffrey Epstein died by homicide.  The group was met with a "nice little panel" of Justice Department officials, Mark Epstein recalled.The officials said Jeffrey Epstein died by suicide. Pressed for more detail, they just repeated themselves."They didn't give me any information other than 'After a thorough investigation, we determined it was a suicide,'" Mark Epstein said. "It was like I was talking to a fucking robot."The meeting was the only time Mark got any answers from the DOJ about his brother's death. Three years later, he still doesn't know exactly how Epstein died and why it's taken the government that long to share its answer to that question.Mark Epstein told Insider that even though he's Jeffrey's next of kin, he hasn't been able to obtain certain medical records, including the care reports filled out by EMTs who evaluated his brother's corpse.The public hasn't gotten answers either. Epstein flew at the heights of power, consorting with presidents and princes while at the same time abusing scores of girls. His death in the custody of the Bureau of Prisons represents one of the most shocking failures of federal law enforcement in history. How could the Justice Department let him just slip away?The Justice Department's Office of Inspector General launched an investigation after he was found dead. But more than three years later, the office still hasn't released its report into the circumstances of Epstein's death.In the information vacuum, conspiracy theories have proliferated about whether Epstein was killed to cover up for his powerful friends — Bill Clinton, Donald Trump, and Prince Andrew among them.Epstein's victims and at least one US senator are still demanding answers from the DOJ.  "For many people, the death was suspicious, to say the least," said Gloria Allred, an attorney who represents 20 of Epstein's victims. "Others have their own conclusions about what happened to Mr. Epstein. But the speculation needs to be replaced by facts and evidence."Mark Epstein remains puzzled by the holdup. He's convinced his brother didn't kill himself and stands by the conclusions of Baden, who personally observed the four-hour autopsy of Jeffrey Epstein's body."We all took it by surprise," Mark Epstein told Insider. "Nobody thought he was gonna kill himself. Nobody."After 3 years, it's not clear what's holding up DOJ's reportWhen Jeffrey Epstein was found dead in his cell, on August 10, 2019, then-Attorney General Bill Barr's first reaction was disbelief, he later wrote in his memoir."No one's gonna believe it was a suicide," Barr recalled saying. "There'll be conspiracy theories all over the place."Epstein had been arrested two months earlier on charges that he trafficked girls for sex. He was investigated by Manhattan federal prosecutors following a series of articles by the Miami Herald journalist Julie K. Brown, who detailed how he secured a secret, lenient plea deal with Florida prosecutors in 2007, even after law enforcement concluded he sexually abused more than 30 girls. A compensation program his estate formed after his death concluded he sexually abused at least 136 people overall.Until his arrest in 2019, Epstein continued living a lavish lifestyle, splitting time between his Palm Beach home, his Manhattan mansion, an island in the US Virgin Islands, and an apartment in Paris.After losing all that, it was possible he found the prospect of life behind bars unappealing, Mark Epstein said. "When I first heard that my brother was dead, and found dead from suicide, I just figured, 'OK, he decided to take himself out,'" he told Insider.Barr tasked the Justice Department's inspector general, Michael Horowitz, and the FBI with investigating "the circumstances of Mr. Epstein's death."There were two major unanswered questions: How, exactly, did he die? And — whether it was a suicide or homicide — how did the Bureau of Prisons allow it to happen?Within those questions are a number of smaller mysteries, still unresolved. Why was Epstein's body moved after his death, in violation of jail protocol? If his body was found hours after he already died, why did paramedics try to push air into his lungs? If he hanged himself, why does Baden believe the bone fractures in his neck were more consistent with strangling? Why would he tear strips of bedsheets to make a noose instead of using the cord of his sleep-apnea machine? Why weren't the cameras watching his cellblock working the day he died? Who else was incarcerated in the same block, and did they see anything?Epstein claimed he had dirt on powerful people and, after his 2007 guilty plea, still appeared to consort with the likes of Mohammed bin Salman of Saudi Arabia, Elon Musk, and Steve Bannon. Were any of Epstein's acquaintances capable of planning an assassination? An Insider poll taken later that fall found nearly half of Americans believed Epstein was murdered.The Justice Department's Office of the Inspector General is uniquely suited to answer these questions. Equipped with subpoena power and statutory independence, the office is one of the rare institutions in Washington, DC, carefully designed to stand apart from partisan forces and political winds.It also had a significant measure of independence from Barr, whose own father may have given Epstein a job that he leveraged into a career in finance.More than three years later, it's not clear why the inspector general's investigation is taking so long.Horowitz's other high-profile investigations concluded far more quickly. An investigation into the flow of US arms to Mexican drug cartels took a year. A 568-page report about how the Justice Department dealt with Hillary Clinton's email server and a 478-page report about the "Crossfire Hurricane" investigation into Trump's links with Russia were each released about a year and a half after they were initiated.Glenn Fine, who served as the Justice Department's inspector general between 2000 and 2011, told Insider the office is likely taking extraordinary care to make sure it gets all the details right."The OIG is probably taking the position: We want to make sure we get it right, and we want to make sure we are thorough and that the report is so convincing that the people who think that Epstein was murdered will be persuaded by all the evidence once it's out there," Fine said.There are four possible reasons the report hasn't yet been released, Fine said. The inspector general's office could still be investigating; it's holding a report so as not to interfere with any pending criminal cases; it's writing the report; or it's waiting for feedback from the Bureau of Prisons. A representative for the Bureau of Prisons said it was cooperating with the Justice Department and referred Insider to the Office of Inspector General for further questions. A spokesperson for the inspector general's office declined to comment on this story.The only public criminal cases linked to the inspector general's investigation were charges brought against Tova Noel and Michael Thomas, the two jail security guards who were tasked with watching Epstein and other inmates housed near him. That case stemmed from investigations by the FBI and the US attorney's office in the Southern District of New York, which is parallel to but independent from the inspector general investigation, run out of Washington, DC.In a November 2019 indictment, Manhattan prosecutors said Noel and Thomas skipped their required rounds the night of Epstein's death but falsified records to hide that fact.Prosecutors used court documents in the case to give the public a glimpse of what they had discovered. Video footage indicated no one entered the area outside Epstein's cellblock between 7:49 p.m. on August 9, when he was escorted to his cell, until 6:33 a.m. on August 10, when Noel and Thomas were serving breakfast and found him dead."Epstein was alone in his cell and not responsive, with a noose around his neck," the indictment said.Noel and Thomas entered deferred prosecution agreements in May 2021, agreeing to be interviewed by the OIG's investigators. They sat for those interviews in June that year, according to a person familiar with the investigation who spoke to Insider on the condition of anonymity because they were not authorized to speak on the record.Prosecutors formally dropped the criminal charges against Noel and Thomas in December 2021. Once that case was over, it looked like the path was clear for the inspector general's office to release the report.But it's been more than a year, and the report is still under wraps.Even members of Congress appear to have lost interest in Epstein's fate.Back in December 2019, four members of the Senate Judiciary Committee — Sens. Ted Cruz of Texas, Ben Sasse of Nebraska, Richard Blumenthal of Connecticut, and Marsha Blackburn of Tennessee — wrote an open letter urging Horowitz to complete his investigation."These events have ignited a crisis of public trust in the Department and exacerbated the erosion of trust that the American people have in our institutions of republican self-government more broadly," they wrote.Representatives for Cruz and Blackburn didn't respond to Insider's request for comment on this story. Sasse, who sent a follow-up letter to Horowitz in 2020 and who's now the president of the University of Florida, didn't respond to Insider's request for comment, either.Only Blumenthal responded to Insider's request for comment. He urged Horowitz to release his report soon."I continue to believe the public deserves to be made aware of the results of the Department of Justice's investigation into the death of Jeffrey Epstein," Blumenthal said.Fine believes Horowitz is in a tough spot with the investigation, likely weighing the importance of informing the public against doing a thorough job."I believe that it's important to be timely, particularly in matters of significant public concern," Fine, now a Governance Studies fellow at The Brookings Institution and law professor at Georgetown University, told Insider. "Having said that, it's most important to get it right, and to be thorough and persuasive."Epstein's death highlighted bigger problems in federal jails It remains unclear how much of the inspector general's investigation has encompassed failures at the jail where Epstein was housed.After Noel and Thomas were charged with falsifying records, their lawyers argued they were scapegoats for the Bureau of Prisons as a whole, which left the Metropolitan Correctional Center chronically understaffed, forced employees to work extraordinarily long hours, and allowed the facility to deteriorate. Only 18 employees were guarding the MCC's roughly 750 inmates the night Epstein died, records show.Records obtained by The New York Times demonstrate that jail staffers bungled routine details. An intake form described Epstein as a Black male and indicated he had no prior sex-offense convictions. Numerous phone calls he made while in custody weren't logged.Martin Weinberg, one of Epstein's criminal defense attorneys in his New York case, told Insider that he hopes the inspector general's investigation will shed more light on the dire conditions of the MCC."His conditions of confinement were medieval," Weinberg said. The inspector general's office has made passing mentions of Epstein a handful of times in broader reports about the Justice Department. In 2019, it mentioned the deaths of Epstein and Whitey Bulger as examples of why the Bureau of Prisons needed better monitoring for incarcerated people. A 2020 report said the indictment against the two jail guards, Noel and Thomas, promoted "accountability."In a 2022 report about the Justice Department's challenges, the inspector general's office called Epstein's death a suicide and said it had "numerous ongoing investigations" into whether Bureau of Prisons employees did their job well and how deaths like Epstein's "impair the public's trust in the Department."The Bureau of Prisons shut down the MCC entirely in August 2021 and transferred its inmates to other facilities. It remains closed.Despite the Justice Department's policy of not commenting on ongoing investigations, Barr has happily gabbed about how the MCC was to blame for Epstein's death.Just two days after Epstein's death, Barr suggested in a speech to police-union members that the investigation would focus on "serious irregularities" at the jail.In an interview with the Associated Press in November 2019, Barr said he concluded Epstein killed himself and that "a perfect storm of screwups" at the MCC allowed it to happen. In his memoir, the former attorney general wrote that correctional staff failed to do their job of checking on Epstein every 30 minutes, and that he was not housed in the same cell as "a trusted inmate," as he was supposed to be, as a result of "an unintentional oversight."Mark Epstein doesn't believe his brother killed himselfWhen Mark Epstein saw Barr dismiss the possibility of a murder based on his review of security footage outside Jeffrey Epstein's cell tier, he wasn't remotely satisfied. "What I thought was, this is either a cover-up, or he's the dumbest fuck on the planet," Mark Epstein said.To Mark, Barr's version of events suggests he came to the conclusion that Jeffrey Epstein killed himself and then backfilled evidence from there. Barr seemed to consider only the possibility that a murderer would have been someone who snuck into the jail. Mark told Insider he was gobsmacked that Barr didn't seem to consider the possibility that someone else in Jeffrey Epstein's block of cells killed him.Since there were eight cells in the tier, there would have been between seven and 14 people other than Epstein in the block, depending on how many had cellmates. The Justice Department has not made the names of those incarcerated people public.Mark Epstein told Insider that he spoke to his brother about once a month in the years before his death. The two caught up over the phone while Jeffrey Epstein was in Paris, the night before he flew to New Jersey and was arrested after his private jet landed.Jeffrey Epstein had reasons to stay alive, Mark said. He didn't leave a suicide note — or at least none that has been reported — and reportedly deposited money into other inmates' commissary accounts in return for protection. People who spoke with him in the weeks leading up to his death believed he was optimistic about getting the charges dismissed.After he was arrested, in early August 2019, Epstein and attorney David Schoen had a five-hour meeting to discuss criminal-defense strategies. Schoen told Insider that Epstein appeared optimistic that he'd be protected by the controversial and unusual non-prosecution agreement he signed with Alexander Acosta, the US Attorney in Florida he cut a deal with in 2007. Bill Cosby had his sexual-assault conviction overturned in 2021 for similar reasons, Mark Epstein pointed out. Epstein's Florida agreement had been repeatedly upheld by federal courts.Mark Epstein told Insider he built his wealth independently from his brother, founding a silk-screening business before pivoting to real estate with Ossa Properties, which at one point reportedly owned hundreds of apartments in New York City.At least one of Mark Epstein's Upper East Side buildings, however, includes multiple links to his brother. Mark has said he purchased it from the business magnate Leslie Wexner, his brother's longtime patron. Jeffrey Epstein owned about a dozen apartments in the building, which he used to house at least one of his sex-trafficking victims as well as his private pilots while they were staying in New York, according to testimony at Ghislaine Maxwell's trial. Right before Epstein died, his lawyers were preparing to appeal a judge's decision to deny him bail. They had prepared a bond package valued at $100 million.Mark Epstein agreed to guarantee the whole thing, he told Insider, meaning he'd lose that amount of money if his brother tried to flee authorities."If you get bail, you're gonna be home for a year — under house arrest, with an ankle bracelet, armed guards, video cameras, whatever the conditions were — but he'll be in his house," Mark Epstein said. "So why kill yourself then?"There are still unanswered questions about Epstein's bodyIt's not clear to what extent the inspector general's office has tried to retrace Jeffrey Epstein's last days.Michael Baden — the forensic pathologist, who sits on a commission that reviews all inmate deaths in New York state-controlled prisons and jails — told Insider that investigators haven't interviewed him.Mark Epstein, Weinberg, and Schoen (who said he has full confidence in Horowitz) all spoke to Jeffrey Epstein not long before his death and said they haven't been interviewed by the inspector general's office either.A person close to Ghislaine Maxwell, who is serving a 20-year prison sentence, said the inspector general's office never requested an interview with her about the investigation into Epstein's death.Baden still has lingering questions about the state of Epstein's body.Kristin Roman, the New York City medical examiner who conducted the autopsy, couldn't come to a conclusion and listed the manner of death as "pending further study." Baden claims Roman told him at the time that she wanted to learn more about the circumstances of Epstein's death before making a final determination."It wasn't clear yet what the findings were at the scene, because he was brought out of the cell many hours after he died, when nobody had seen him," Baden said. "We didn't know at the time, and we still don't know, how the two guards found him — whether he was hanging, whether he had a ligature around his neck — because nobody else saw the scene."New York City's chief medical examiner at the time, Barbara Sampson, sidestepped Roman and ruled the death a suicide a few days later, after saying she reviewed additional evidence. She didn't disclose what that additional evidence was, but CBS News reported that one element was Epstein's prior suicide attempt. Roman didn't respond to Insider's request for comment.According to Baden, certain features of Epstein's dead body lined up more with homicide than suicide. His neck bones were fractured in three different places in a way you'd expect from strangling, he said. There weren't hemorrhages in his eyes, as you'd expect with a suicide, according to Baden. And the ligature marks on Epstein's neck didn't look like they'd come from the bedsheet found in his cell, Baden said."The ligatures on the ground do not match the mark on the neck," Baden said. "A smooth sheet leaves a smooth mark on the neck. This one has a pattern. There's a pattern on the skin."A good forensic pathologist, Baden said, would take into account everything about the circumstances of a subject's death. But the public is still missing key details, such as whether inmates could move freely between their cells within the tier and how the cells were locked. Epstein's body was also moved after he was found dead.Baden said he still wants to make a final determination about Epstein's death."As I sit here, I still don't know what position he was found in," Baden told Insider.Epstein's accusers want answers from the DOJThe silence from the DOJ has disappointed Epstein's victims, many of whom believe his death is yet another example of how the federal government failed them in holding the serial child rapist to account.Attorneys who have collectively represented more than 80 of Epstein's accusers told Insider they were disappointed and puzzled by the lack of transparency.Lisa Bloom, an attorney who represented eight of Epstein's accusers, told Insider that the silence only leads to distrust among accusers."In 2019, he was allowed to take his own life to escape justice — maybe that's what happened," she said. "And now, more than three years later, victims do not even get the simple courtesy of a final report. This breeds resentment and distrust. What is the government hiding?""It is remarkable that now, literally years later, the Justice Department has yet to release its report," Paul Cassell, an attorney who sought to invalidate Epstein's non-prosecution agreement, told Insider. "This blatant lack of transparency will only lead to further speculation about exactly how Epstein died."Some of the attorneys said the secrecy may lead to victims of abuse thinking twice before going to authorities."There is no good reason the investigation has taken this long," Brad Edwards, who represented more than 50 of Epstein's accusers, said. "The victims and the public were made strong promises that with pure motive were easy to uphold. The lack of transparency raises suspicions about who is protecting whom or what."Adam Horowitz, an attorney who represented eight of Epstein's accusers and has no relation to Michael Horowitz, told Insider the lack of information "will deter other suffering crime victims from coming forward."Mark Epstein wanted to file a wrongful-death lawsuit against the Bureau of Prisons but said he was blocked by the executors of Jeffrey Epstein's estate. He believes a lawsuit would be a "slam-dunk case" that might have generated answers.An attorney for the estate executors didn't respond to Insider's request for comment.Fine told Insider the inspector general's office may be taking a long time because it's being extraordinarily thorough."I would think the OIG would be assessing the entire situation," Fine said. "Whether it was just a suicide and, if so, how did it happen? I would expect there to be a full report on this, and maybe that's why it's taking a long time."Allred said the inspector general's office should, at the very least, give accusers a time frame for the results of the investigation and be told whether it will be made public."They were denied their day in court to confront Jeffrey Epstein because of his death," she said. "They should not be denied the results of the investigation by the inspector general."Read the original article on Business Insider.....»»

Category: smallbizSource: nytMar 9th, 2023

Silicon Valley Bank, At Center Of Venture Capital Bubble, Suffers Record 47% Crash Amid Sudden Liquidity Crisis

Silicon Valley Bank, At Center Of Venture Capital Bubble, Suffers Record 47% Crash Amid Sudden Liquidity Crisis Is the bursting of the tech bubble finally spilling over to the financial system? One day after the biggest crypto-focused bank, Silvergate Capital, announced plans to unwind and liquidate after a deposit run effectively killed its core business model, this morning its far larger peer - the parent company of the venerable Silicon Valley Bank, SVB Financial Group - saw its shares plunge the most in more than two decades after the company took "steps to bolster its financial position" that included not only a highly dilutive stock offering but also a panicked asset sale that sparked fears of a liquidity crisis at one of the biggest and original providers of funding to the Venture Capital industry. The Santa Clara-based company’s shares sank by as much as 47% on Thursday, their biggest decline in the company's history since going public in 1987. The slump in the shares to their lowest level since May 2020, came after SVB i) announced a stock offering, ii) sold substantially all of the available-for-sale securities in its portfolio and iii) updated its forecast for the year to include a sharper decline in net interest income. “While we view these actions combined with a weaker guide as a clear negative, we do not believe that SIVB is in a liquidity crisis, especially following the significant proceeds” from its sale of securities, Wedbush analyst David Chiaverini wrote as he cut his price target for the company to $200 from $250. Others clearly disagreed and dumped the stock at a pace not seen in a quarter century. The bank also said it had sold about $21 billion of securities from its portfolio (with a plan to reinvest the proceeds but don't hold your breath) which will result in an after-tax loss of $1.8 billion for the first quarter. And the cherry on top was SVB's announcement of equity offerings for $1.25 billion of its common stock and $500 million of securities that represent convertible preferred shares. Additionally, General Atlantic committed to purchase $500 million of common stock, taking the total amount being raised to about $2.25 billion. It wasn't immediately clear whether the SIVB liquidity crisis is a function of assets, i.e., loans collateralized by toxic early stage investments that have turned sour... or liabilities, i.e., a good old-fashioned deposit bank run. “The improved cash liquidity, profitability and financial flexibility resulting from the actions we announced today will bolster our financial position and our ability to support clients through sustained market pressures,” the company said in a letter to stakeholders but judging by the stock reaction, nobody believed it. Tyler Durden Thu, 03/09/2023 - 12:59.....»»

Category: dealsSource: nytMar 9th, 2023

Washington Post Lets Hersh"s Dangerous Cat Out Of The Bag

Washington Post Lets Hersh's Dangerous Cat Out Of The Bag Authored by Ray McGovern via, Bombshell No. 1: Seymour Hersh’s Feb. 8 report that President Joe Biden authorized the sabotage of the Nord Stream pipelines built to carry cheap Russian gas to Europe. Bombshell No. 2: The Washington Post today ended the Establishment media embargo on Hersh’s damning report, mentioning its findings and even including a link to his article. The Post’s article by Karen DeYoung, no rogue reporter, bore the headline, "Russia, blaming US sabotage, calls for UN probe of Nord Stream." DeYoung reported on the UN Security Council meeting yesterday at which Russia called for a special United Nations commission to investigate the explosions that blew up the Nord Stream undersea pipelines. DeYoung also noted that Professor Jeffrey Sachs and I gave short briefings at the beginning of the Security Council session. Here’s an edited summary account by the UN of our testimony at the Security Council session: SACHS: As the destruction of the Nord Stream pipelines on 26 September 2022 constitutes an act of international terrorism and represents a threat to peace, it is the Council’s responsibility to take up the question of who might have carried out the act, help bring the perpetrator to justice, pursue compensation for the damaged parties and prevent such actions from recurring in the future. Countries need full confidence that their infrastructure will not be destroyed by third parties. The destruction of the Nord Stream pipelines required a very high degree of planning, expertise and technological capacity, he continued, adding that only a handful of State-level actors have both the technical capacity and access to the Baltic Sea to have carried out this action. These include the Russian Federation, the United States, the United Kingdom, Poland, Norway, Germany, Denmark and Sweden, either individually or in some combination. Sweden has perhaps the most to tell the world about the crime scene; that country has kept the results of its investigation secret from the rest of the world. It has refused to share its findings with the Russian Federation and turned down a joint investigation with Denmark and Germany. Pointing to investigative journalist Seymour Hersh’s detailed account of the Nord Stream destruction, he said his work attributes the Nord Stream destruction to a decision ordered by United States President Joseph R. Biden and carried out by United States agents in a covert operation. The Biden Administration has described Hersh’s account as "completely and utterly false" but did not offer any information contradicting Hersh’s account and/or any alternative explanation. RAY MCGOVERN: Mr. Hersh attracts whistle-blowers because of his perfect record of protecting their identities and accurately publishing what they reveal, despite Government attacks. While some are now smearing Mr. Hersh, such critics do not themselves have a good record of credibility… The North Atlantic Treaty Organization (NATO) more than doubled in size, despite its promises not to. When Crimea was annexed by the Russian Federation, President Vladimir Putin noted that the country had to annex Crimea due to a February 2014 coup, and due to the prospect that medium-range ballistic missiles will be placed in already operational systems in Romania and Poland. Despite being disguised as anti-ballistic missile systems, they can easily accommodate hypersonic missiles. China Gives Full Support to Russian Resolution ZHANG JUN (China): It is increasingly clear that the damage to the Nord Stream pipelines was a deliberate human act. The United Nations can play an active role by ensuring the security of transboundary infrastructure, among other things. China welcomes the draft resolution tabled by the Russian Federation that authorizes an investigation into the sabotage of the Nord Stream pipelines. Why Crimea Annexed I included two related but under-analyzed issues in my remarks. (1) Why President Putin considered it important to annex Crimea; and (2) the so-called "unprovoked" nature of Russia’s invasion of Ukraine. In an earlier interview with Brian Becker, I called attention to a not-widely-known public comment on April 17, 2014 by President Vladimir Putin, a month after the annexation of Crimea, focusing on the reasons behind Moscow’s strong reaction. One main reason was Russia’s felt need to thwart Washington’s plan to incorporate Ukraine and Crimea into U.S. antiballistic missile deployment encircling Russia. PUTIN: "This issue is no less, and probably even more important, than NATO’s eastward expansion. Incidentally, our decision on Crimea was partially prompted by this." Earlier, in a formal address in the Kremlin on March 18, 2014, the day Crimea was re-incorporated into Russia, Putin went from dead serious to somewhat jocular in discussing the general issue. PUTIN: "We have already heard declarations from Kiev about Ukraine soon joining NATO. What would this have meant for Crimea and Sevastopol [the Russian naval port] in the future? It would have meant that NATO’s Navy would be right there in this city of Russia’s military glory, and this would create not an illusory but a perfectly real threat to the whole of southern Russia… "We are not opposed to cooperation with NATO … [but] NATO remains a military alliance, and we are against having a military alliance making itself at home right in our backyard or in our historic territory… "I simply cannot imagine that we would travel to Sevastopol to visit NATO sailors. Of course, most of them are wonderful guys, but it would be better to have them come and visit us, be our guests, rather than the other way around." ‘Unprovoked’ Given the "mainstream media’s" coverage (or lack thereof), small wonder that the American people forget about (or never heard of) the Feb. 22, 2014 coup in Ukraine. In 2015, when Sen. John McCain feigned short-term memory loss, I got the following letter into the Washington Post. (The Post’s URL seems to have disappeared.) McCain, Ukraine and Mr. Putin In his June 28 Sunday Opinion essay, "The Ukraine cease-fire fiction," Sen. John McCain was wrong to write that Russian President Vladimir Putin annexed Crimea without provocation. What about the coup in Kiev on Feb. 22, 2014, that replaced President Viktor Yanukovych with pro-Western leaders favoring membership in NATO? Was that not provocation enough? This glaring omission is common in The Post. The March 10 World Digest item "Putin had early plan to annex Crimea" described a "secret meeting" Mr. Putin held on Feb. 23, 2014, during which "Russia decided it would take the Crimean Peninsula." No mention was made of the coup the previous day. I have searched in vain for credible evidence that, before the coup, Mr. Putin had any intention to annex Crimea. George Friedman, the widely respected president of the think tank Stratfor, has described the putsch on Feb. 22, 2014, as "the most blatant coup in history." So much for ‘unprovoked.’ As most paying-attention people know, there has been a long string of provocations since I wrote that letter in 2015. And so it goes. Tyler Durden Fri, 03/03/2023 - 16:20.....»»

Category: blogSource: zerohedgeMar 3rd, 2023

Howard Law School Sued by White Student Over Racial Discrimination

Howard Law School Sued by White Student Over Racial Discrimination Authored by Jonathan Turley, A new lawsuit is garnering attention in Washington where a white law student has sued Howard University’s School of Law for racial discrimination. Michael Newman alleging the school maintains a “hostile education environment.” The complaint names Law Dean Danielle Holley as well as other Howard officials in addition to the university as a whole. Newman joined the freshman class at Howard in the fall semester of 2020 and remained there for two years.  He was expelled in September 2022. He alleged that he suffered “depression, anxiety and suicidal thoughts” as a result of “public ostracism, vilification and humiliation” due to his race. The complaint is particularly detailed in what Newman alleges was Holley’s role in this hostile environment. It alleges that Holley told him that the school owed him no First Amendment rights as a private institution and denied that using terms like “King Mayo” and “mayonnaise” were in any way racial epithets. He claims that Holley told student to avoid interacting with him and advised him to avoid further discourse with students. Global Head of Diversity Recruiting Reggie McGahee allegedly told Newman he had become the most hated student he had seen during his time at Howard. Newman was targeted by students after he posted thoughts on an online forums following a symposium featuring an African-American speaker in the run-up to the 2020 election. Newman asked a professor if there could be further dialogue on “whether: (1) Black voters didn’t question turning to government for solutions, and (2) reliably voting for the same party every election disincentivized both parties from responding to the needs of the black communities.” The response was highly negative and Newman was removed from at least one of his group chats for the class. Another flashpoint occurred after a student searched Newman’s social media posting and found a famous picture of a slave baring his badly scarred back with the caption, “But we don’t know what he did before the picture was taken.”  Newman explained that this was a posting against police brutality and an attempt to rebut claims that victims must have done something wrong to justify such a reaction. Newman faced racial slurs as the “mayo king” and “white panther.” Other students claimed that the “controversies” caused by his exercise of free speech was producing stress and inhibiting their learning. When Newman attempted to explain his views in a four-part letter, it was labeled a “manifesto” and resulted in Newman’s removal from a second class-wide group chat. Holley is accused of secretly recording at least one meeting with Newman and publicly denouncing Newman’s views in a public forum as “disturbing in every sense of the word.” She allegedly blocked him from using several functions to try and speak up in his defense, even disabling the chat function and turning off his camera. Holley and Newman filed complaints against each other. A law school panel sided with the dean, but the complaint alleged that his complaint was never adjudicated. Holley is correct, if as alleged, she denied the governance of the First Amendment over her actions or those of her school. Howard is a private, not a state, school. However, the university guarantees free speech protections for both students and faculty, even though the university has been repeatedly flagged as hostile to free speech due to its speech code. It is ranked 93rd on free speech rights. Moreover, as Dean, Holley should be striving to assure free speech protections for all students as the very foundation for higher education. That is particularly true at a law school that should be instilling the values of free speech that define not just our country but our profession. Tyler Durden Fri, 03/03/2023 - 12:44.....»»

Category: worldSource: nytMar 3rd, 2023

Democratic Rep. Judy Chu, the first Chinese American woman elected to Congress, blasts a Texas GOP congressman after he questioned her loyalty to the US: "It is racist"

"If she doesn't realize what's going on then she's totally out of touch with one of her core constituencies," Rep. Gooden said of Chu on Fox News. California Democratic Rep. Judy Chu hit back at Texas GOP Rep. Lance Gooden after he responded to her criticism of a Republican effort to investigate Biden economic appointee Dominic Ng.AP Photo/J. Scott Applewhite Judy Chu criticized Lance Gooden after he seemingly questioned her "loyalty" to the US on Fox News. Gooden called out Chu after she blasted GOP attempts to investigate Biden economic appointee Dominic Ng. Chu responded to Gooden, describing his remarks regarding her allegiance to the US as "racist." Rep. Judy Chu, the first Chinese American woman elected to Congress, on Thursday blasted Texas GOP Rep. Lance Gooden over recent statements that he made where he seemingly questioned her loyalty to the United States.During a Wednesday interview on Fox News, the third-term Gooden suggested that the California Democrat, who has served in the House since 2009, should be barred from accessing sensitive classified materials over her defense of Dominic Ng — the chairman and chief executive of the California-based East West Bank and President Joe Biden's appointee to the Asia-Pacific Economic Cooperation Business Advisory Council.Several Republicans, including Gooden, have said that Ng needs to be investigated by the FBI after a Daily Caller investigative article was published alleging the banker had ties to a Chinese Communist Party front group.Gooden, while on the Fox News program "Jesse Watters Primetime," rebuked Chu, calling her "out of touch.""I question her either loyalty or competence," he said during the interview. "If she doesn't realize what's going on then she's totally out of touch with one of her core constituencies."Earlier this month, Chu, the chair of the Congressional Asian Pacific American Caucus, released a joint statement with Reps. Ted Lieu and Mark Takano of California and Rep. Grace Meng of New York that condemned the GOP move.Gooden while on Fox News criticized Chu for issuing the statement, while also accusing her of being the "ringleader" behind the effort."I think she has drug along the other Chinese American members to sign this letter. But I do think she's the ringleader," Gooden said. "I'm really disappointed and shocked that someone like Judy Chu would have a security clearance and be entitled to confidential intelligence briefings until this is figured out."Chu and top Democratic lawmakers quickly slammed Gooden over his comments."Rep. Gooden's comments on Fox News questioning my loyalty to the USA is absolutely outrageous," Chu said in a statement. "It is based on false information spread by an extreme, right-wing website. Furthermore, it is racist. I very much doubt that he would be spreading these lies were I not of Chinese American descent."House Democratic leader Hakeem Jeffries of New York also zeroed in on Gooden, needling him over his actions after the 2020 presidential election, when then-President Donald Trump sought to overturn now-President Joe Biden's electoral victory. In January 2021, Gooden voted against the certification of electors from Arizona and Pennsylvania in the 2020 election. Biden narrowly won both states over Trump, flipping them into the Democratic column, a point of contention for many Republicans who questioned the integrity of the results despite no evidence of widespread voter fraud."Lance Gooden's slanderous accusation of disloyalty against Rep. Chu is dangerous, unconscionable and xenophobic," Jeffries said in a statement. "Congressman Gooden appears to sympathize with violent insurrectionists and spreads big lies to the American people, having voted not to certify the election of President Joe Biden.""Look in the mirror, Lance. You have zero credibility," he added.Rep. Suzan DelBene of Washington, the chair of the Democratic Congressional Campaign Committee, on Friday excoriated Gooden over his comments."At a time when anti-Asian hate continues to threaten communities, it's critical that we condemn these racist and xenophobic attacks immediately and hold our fellow colleagues accountable to rid our politics of such dangerous statements and hatred," she said in a statement.And Rep. Adam Schiff of California, a 2024 Senate candidate and former Intelligence Committee chairman who last month was removed from the panel by House Speaker Kevin McCarthy of California, also decried Gooden's comments."Questioning @RepJudyChu's loyalty to the United States is xenophobic and racist," Schiff tweeted. "Shame on you, @LanceGooden. And on @FoxNews for airing such hate. We cannot allow anti-Asian bigotry to go without condemnation."Rep. Gooden accused Democrats of bringing up race after his criticism of Rep. Chu.Bill Clark/CQ-Roll Call, Inc via Getty ImagesAll eyes on ChinaGooden hit back at the Democratic charges, accusing Chu and Jeffries of inserting race into the discussion."Rather than following facts that indicate the presence of Chinese espionage, Chu and Jeffries are playing the race card in a sick display of disloyalty to our nation," Gooden remarked in an email.During his Fox News interview, Gooden also voiced his frustration over the Democratic response to the GOP request for a probe into Ng."We're standing up to communist China and these Democrats' first reaction is to come to their defense and call us all racists," Gooden said at the time.The jockeying among both parties comes as many lawmakers are pushing for a firm line against China, especially after a spy balloon operated by the Chinese traversed the interior of the United States before being taken down over the Atlantic Ocean.While Biden and top military officials in his administration were closely monitoring the balloon, with the president even remarking that he sought to take down the object shortly after he found out about its existence, the commander-in-chief was ultimately advised that it would be safer to shoot down the balloon over water.Many Republican lawmakers immediately launched a wave of criticism against Biden, stating that the balloon should have immediately been taken down.But Sen. Mitt Romney of Utah, the party's 2012 presidential nominee, defended the administration's stance while speaking with CNN earlier this month after a congressional briefing on the matter."I believe that the administration, the president, our military and intelligence agencies, acted skillfully and with care," he told the network. "At the same time, their capabilities are extraordinarily impressive."Read the original article on Business Insider.....»»

Category: topSource: businessinsiderFeb 25th, 2023

Operation Choke Point 2.0 Is Underway, And Crypto Is In Its Crosshairs

Operation Choke Point 2.0 Is Underway, And Crypto Is In Its Crosshairs Authored by Nic Carter via Pirate Wires, What began as a trickle is now a flood: the US government is using the banking sector to organize a sophisticated, widespread crackdown against the crypto industry. And the administration’s efforts are no secret: they’re expressed plainly in memos, regulatory guidance, and blog posts. However, the breadth of this plan — spanning virtually every financial regulator — as well as its highly coordinated nature, has even the most steely-eyed crypto veterans nervous that crypto businesses might end up completely unbanked, stablecoins may be stranded and unable to manage flows in and out of crypto, and exchanges might be shut off from the banking system entirely. Let’s dig in. For crypto firms, obtaining access to the onshore banking system has always been a challenge. Even today, crypto startups struggle mightily to get banks, and only a handful of boutiques serve them. This is why stablecoins like Tether found popularity early on: to facilitate fiat settlement where the rails of traditional banking were unavailable. However, in recent weeks, the intensity of efforts to ringfence the entire crypto space and isolate it from the traditional banking system have ratcheted up significantly. Specifically, the Biden administration is now executing what appears to be a coordinated plan that spans multiple agencies to discourage banks from dealing with crypto firms. It applies to both traditional banks who would serve crypto clients, and crypto-first firms aiming to get bank charters. It includes the administration itself, influential members of Congress, the Fed, the FDIC, the OCC, and the DoJ. Here’s a recap of notable events concerning banks and the policy establishment in recent weeks:    On Dec. 6, Senators Elizabeth Warren, John Kennedy, and Roger Marshall send a letter to crypto-friendly bank Silvergate, scolding them for providing services to FTX and Alameda research, and lambasting them for failing to report suspicious activities associated with those clients On Dec. 7, Signature (among the most active banks serving crypto clients) announces its intent to halve deposits ascribed to crypto clients — in other words, they’ll give customers their money back, then shut down their accounts — drawing its crypto deposits down from $23b at peak to $10b, and to exit its stablecoin business On Jan. 3, the Fed, the FDIC, and the OCC release a joint statement on the risks to banks engaging with crypto, not explicitly banning banks’ ability to hold crypto or deal with crypto clients, but strongly discouraging them from doing so on a “safety and soundness” basis On Jan. 9, Metropolitan Commercial Bank (one of the few banks that serve crypto clients) announces a total shutdown of its cryptoasset-related vertical On Jan. 9, Silvergate stock falls to a low of $11.55 on bank run and insolvency fears, having traded as high as $160 in March 2022  On Jan. 21, Binance announces that due to policy at Signature bank, they will only process user fiat transactions worth more than $100,000  On Jan. 27, the Federal Reserve denies crypto bank Custodia’s two-year application to become a member of the Federal Reserve system, citing “safety and soundness” risks On Jan. 27, the Kansas City Fed branch denies Custodia’s application for a master account, which would have given it the ability to use wholesale payment services, and to hold reserves with the Fed directly On Jan. 27, the Fed also issues a policy statement which discourages banks from holding cryptoassets or issuing stablecoins, and broadens their authority to cover non-FDIC insured state-chartered banks (a reaction to Wyoming Special Purpose Depository Institutions (SPDIs) like Custodia, which can hold crypto alongside fiat for its banking customers)  On Jan. 27, the National Economic Council releases a policy statement not explicitly banning banks from serving crypto clients, but strongly discouraging banks from transacting with cryptoassets directly or maintaining exposure to crypto depositors On Feb. 2, the DoJ’s fraud unit announces an investigation into Silvergate over their dealings with FTX and Alameda  On Feb. 6, Binance suspends USD bank transfers for retail clients (Binance US was not affected) On Feb. 7, the Jan. 27 Fed statement is entered into the federal register, turning the policy statement into a final rule, with no Congressional review, or public notice-and-comment period  As of Feb. 8, Protego and Paxos’ applications to follow Anchorage and obtain full approval to become National Trust Banks are still outstanding (past the 18 month deadline), and appear likely to be imminently denied by the OCC  In sum, banks taking deposits from crypto clients, issuing stablecoins, engaging in crypto custody, or seeking to hold crypto as principal have faced nothing short of an onslaught from regulators in recent weeks. Time and again, using the expression “safety and soundness,” they’ve made it clear that for a bank, touching public blockchains in any way is considered unacceptably risky. While neither the Fed/ FDIC/ OCC statement — nor the NEC statement a few weeks later — explicitly ban banks from servicing crypto clients, the writing is on the wall, and the investigations into Silvergate are a strong deterrent to any bank considering aligning itself with crypto. What is clear now is that issuing stablecoins or transacting on public blockchains (where they could circulate freely, like cash) is highly discouraged, or effectively prohibited. It is equally evident that a bank-issued fiat token would only be acceptable to regulators if it were domiciled on a surveilled, private blockchain. No ‘unhosted’ wallets allowed. 1 And perhaps most damagingly, the Fed’s devastating denial of Wyoming SPDI bank Custodia, as well as their policy statement, effectively ends any hopes that a state-chartered crypto bank might get access to the Federal Reserve system without submitting to FDIC oversight. Why might crypto entrepreneurs be wary of the FDIC? It traces back to Operation Choke Point. Some in the crypto space believe that the recent attempts to ringfence the crypto industry and cut off its connectivity to the banking system are reminiscent of this little-known Obama-era program. Beginning in 2013, Choke Point was a scheme which sought to marginalize specific industries operating legally — not through lawmaking, but by applying pressure via the banking sector. The Obama DoJ had already cut its teeth with its successful effort to sideline the online poker space in 2011 and 2012 with threats issued to banks supporting poker companies. With Choke Point, the Department decided to scale up its efforts and target other industries, starting with uncontroversial targets like payday lenders. Then, the DoJ coordinated with the FDIC and OCC to pressure member banks to “redline” — determine as too risky to do business with — certain legal but politically disfavored sectors, chief among them firearms manufacturers and adult entertainment 2 . Banks and payment processors internalized this guidance, and even after the program was formally shuttered under Trump in 2017, its shadow lingered. Today, banks simply ascribe a higher risk to activities that they suspect might draw the government’s ire, even if no specific guidance exists. Since Choke Point nominally ended, using financial rails as an extra-judicial political cudgel has only become more popular. Under pressure, a number of banks walked away from the Dakota Access Pipeline in 2017. In 2018, Bank of America and Citigroup deplatformed firearms companies, and BoA began to report client firearm purchases to the federal government. In 2019, AOC announced her intent to marginalize private prisons through her seat on the House Financial Services Committee. Financial regulators are being asked to advance progressive causes, too. In 2021, the Democratic House passed the “Federal Reserve Racial and Economic Equity Act,” which would have required the Fed to aim to “eliminate disparities across racial and ethnic groups with respect to employment, income, wealth, and access to affordable credit.” Gensler’s SEC now maintains a controversial climate agenda, as does the Fed (at smaller scale). Kamala Harris has deputized banks to advance a racial equity agenda, effectively imposing uneven demographic standards for credit provision. Today it’s even commonplace for explicitly conservative organizations like Gab or Parler, and various malcontents and dissidents who fall afoul of regime politics, to find themselves deplatformed from banks, fintech, and payment processors that they rely on to do business. For those who support this, I would invite you to imagine what financial inclusion (or exclusion) under a similarly zealous DeSantis administration might look like. “Just build your own bank,” right? Well, not if the Fed has anything to say about it. As evident with the stillborn Wyoming SPDI, the crypto industry tried that path and was utterly stymied. Banks are highly regulated public-private partnerships in an environment where new charters are excruciatingly hard to obtain, and as such remain de facto arms of the state. It has been and remains trivial to deputize them to carry out political objectives. If there was any doubt, it’s now evident that the Obama administration and its successor in Biden’s regime are comfortable circumventing the First Amendment by engaging nominally private companies to do their dirty work. Anyone paying remote attention would have noticed the oddly close revolving door between monopolistic big tech firms and Obama/ Biden security state officials. And ever since Elon Musk leaked the Twitter Files, it’s nakedly clear that the US government and its security apparatus used proxies at Twitter for overt censorship and narrative control. Twitter is “just a private company,” though, right?  In 2017, Trump and Republican lawmakers like Rep. Luetkemeyer were able to put a stop to Choke Point for a time, but it didn’t last. One of the first moves from Biden’s OCC was to undo Brian Brook’s Fair Access rule that prohibited political discrimination in banking. Biden’s deputies picked up where Obama’s regulators had left off. And now, after the time it took to digest Biden’s Executive Orders, regulators are tightening the screw.  Today, the outlook for banks remotely interested in crypto is precarious. Bankers tell me that crypto is toxic and the risks of engaging with the asset class aren’t worth it. In the wake of the Custodia decision, obtaining a new charter for a crypto bank looks extremely unlikely. Banking innovations at the state level, like Wyoming’s SPDI for crypto banks, appear dead in the water. Federal Charters for crypto firms with the OCC also look dead in the water. Traders, liquid funds, and businesses with crypto working capital are nervously examining their stablecoin portfolios and fiat access points, wondering if bank connectivity might be severed with little notice. Privately, entrepreneurs and CEOs in crypto tell me that they sense a regulatory noose tightening. As crypto-facing banks ‘derisk,’ younger and smaller firms will struggle to get banking, taking us back to the 2014 to 2016 period when fiat access for crypto businesses was at an extreme premium. Exchanges and other businesses that rely on fiat onramps are concerned that their few remaining bank partners will shut them off or institute draconian standards for scrutiny. As a venture capitalist operating at the early stage, I am directly witnessing the chilling effects of this policy in action. Founders are reckoning with new uncertainties around whether they’ll be able to operate their businesses at all.  So why the push by bank regulators now? The FTX collapse and its ensuing effects, particularly on Silvergate, provides much of the answer. Financial regulators weren’t interested in FTX while the fraud was underway (with the exception of the SEC and its chairman Gensler, who had oddly close ties to the organization), but ever since the exchange failed in spectacular fashion, they are now contemplating ways to avoid the next such collapse. FTX as an offshore exchange was not directly supervised by financial regulators (aside from FTX US, which was a marginal stub), so it was outside of their direct aegis. However, regulators believe that they might have a silver bullet in the fiat on- and off-ramps on which the industry relies. If they can choke off fiat access, they can marginalize the industry — on and off shore — without regulating it directly.  In some key respects, Crypto Choke Point 2.0 differs from the original. It appears that the administration has learned from the efforts of its predecessors. In Choke Point 1.0, guidance was mainly informal and involved backdoor, off-the-record conversations. Its main tool was the threat of investigation from the DoJ and FDIC if financial institutions didn’t internalize the administration’s risk standards. Because this was patently unconstitutional, it gave Republicans the collateral to ultimately repeal the program. In 2.0, everything is happening in plain sight, in the form of rulemaking, written guidance, and blogs. The current crypto crackdown is being sold as a “safety and soundness” issue for banks, and not merely a reputational risk issue. Jake Chervinsky of the Blockchain Association calls it “regulation by blog post.” No need to ask Congress for new laws if federal regulators can simply make policy (and in the case of the Fed, grow their scope and mandate) by publishing guidance which dissuades banks from doing business with crypto. Custodia’s Caitlin Long calls the Fed denial of her application “shooting the stallion to scatter the herd.”  As a consequence, the only banks willing to touch crypto at this point are smaller, less risk-averse ones, with more to gain from banking the industry. However, this means that crypto deposits and flows end up being substantial relative to their core business, which introduces concentration risks. Banks prefer not to have excessive exposure to single counterparties, or a depository base that is highly correlated in its flows. Silvergate felt this acutely with the bank run it suffered — and survived — post FTX. While it’s impressive that they were able to honor a 70% drawdown in their depository base, that episode will dissuade any banks looking to serve crypto clients that might face the same.  And practically speaking, labeling crypto-facing banks “high risk” has four direct effects: it gives them a higher premium with the FDIC, they face a lower cap rate with the Fed (which inhibits their ability to overdraw), they face restrictions on other business activities, and management risks a poor examination score with their regulatory supervisors, which inhibits their ability to do M&A. So while some analysts like Wilson Sonsini’s Jess Cheng have pointed out, somewhat optimistically, that banks are not explicitly barred from providing crypto custody or onboarding crypto clients, they still stand to get labeled high risk — and face serious business hurdles as a result.  Some might be sympathetic to regulators’ attempts to insulate the banking system from the vicissitudes of the crypto space. But thus far, crypto’s various disasters haven’t produced any meaningful contagion. The industry had a full-blown credit crisis in 2022, with virtually every major lender going bankrupt, but the damage was contained. The worst fallout in the banking space was suffered by Silvergate, which suffered an $8b drawdown, but survived. No onshore, fiat-backed stablecoin suffered any meaningful adverse effects, despite the massive crypto selloff in 2021 and 2022. They functioned as intended. And no contagion spilled into traditional finance via mass selling of Treasuries, something officials have historically felt might be a key transmission channel.  As Biden enters the second half of his term, his crackdown on crypto banking has deflated hopes for a regulatory rapprochement in the US. Many crypto entrepreneurs now tell me that they’re waiting for 2025 and a putative DeSantis regime for things to turn. Some can’t wait that long, and are shuttering their plans for businesses which involve any type of regulatory approval, especially with regards to bank charters. Regulators are effectively picking winners — with larger, more established crypto firms able to hang on to their bank relationships, while newer ones are shut out. Meanwhile, other jurisdictions are making a bid for their business. Hong Kong has adopted a friendlier tone once again, as has the UK. The UAE and the Saudis are looking to attract crypto firms. And US regulators can scarcely afford to forget what happened with FTX, in which they curtailed the business activities of onshore exchanges, effectively pushing US individuals into the waiting claws of SBF. If bank regulators continue their pressure campaign, they risk not only losing control of the crypto industry, but ironically increasing risk, by pushing activity to less sophisticated jurisdictions, less able to manage genuine risks that may emerge. -Nic Carter Author’s note: Thanks to Austin Campbell for his feedback on this story. 1) If you’re wondering how using a stablecoin on-chain is substantively different from a bank letting clients withdraw cash from an ATM and using it to buy something from someone else, you’re not alone. 2) The FDIC at one point listed 30 different industries for banks to avoid. Subscribe to Pirate Wires here... Tyler Durden Fri, 02/10/2023 - 07:20.....»»

Category: smallbizSource: nytFeb 10th, 2023

Google is in a weird place right now

Google's Bard feels like a knee-jerk reaction to Microsoft Bing's integration with ChatGPT. Plus, Twitter's massive outage. InsiderAre you single and ready to mingle, reader? I'm Diamond Naga Siu, and I'm not single but am always ready to mingle — in a professional sense, that is. Even if I were on the proverbial market, I'm not sure how much I'd want to rely on tech to find love.One person told Insider how dating an AI chatbot is the best thing that's happened to him in decades. Another shared how the same dating service helped ease her anxious attachment style. It's giving "Be Right Back" from Black Mirror.More relatably, former 10 Things in Tech writer Jordan Parker Erb tried using ChatGPT to respond to Hinge matches. And then, she had a dating coach rate ChatGPT's responses to Tinder matches.But the coach warned: "It's really important to try to steer away from (AI) when it comes to dating."I guess ChatGPT won't be planning my Valentine's Day. But for now, let's jump into today's tech.P.S. I'm finally hosting the Reddit AMA on tech layoffs (it was delayed due to technical difficulties). It's on Thursday, February 9 at 1 p.m. PT/4 p.m. ET in the r/cscareerquestions subreddit. I look forward to chatting with you soon!If this was forwarded to you, sign up here. Download Insider's app here.Google Bard VS OpenAI ChatGPT displayed on Mobile with Openai and Google logo on screen seen in this photo illustration. On 7 February 2023 in Brussels, Belgium.Jonathan Raa/NurPhoto/Getty ImagesGoogle is in a weird place right now. After Microsoft announced integration of ChatGPT with Bing, all eyes were on Google to do something. And it did. The search giant had a knee-jerk reaction that resulted in what my teammate Hasan Chowdhury said was a FOMO-filled event on Wednesday.Bard is Google's competitor to ChatGPT and will become available to the public in coming weeks. It's currently only open to "trusted testers," and my teammate writes that "trusted" is the key word, since Google doesn't trust you.Google has had the majority of search users for a long time. But now that Microsoft has upgraded Bing with ChatGPT, it's primed to win over some of Google's users.Yet, in this crucial moment, Google seems to only be able to react with fear, Hasan writes.Lean into Google's discomfort here.CFOTO/Future Publishing/Getty ImagesIn other news:Google is about to destroy online search. Bard will save you time searching for things online. But at the same time, the chatbot will sometimes give you wrong answers. We break down chatbot hallucinations for you here.Microsoft's new Bing refuses to write cover letters. Unlike ChatGPT, the upgraded Bing rejected my colleague Huileng Tan's request to write a cover letter for a job. The chatbot said it would be "unethical" and "unfair to other applicants." More on the job rejection here.Pharmacy startup Medly is shutting down. An Insider investigation previously revealed that the startup grew faster than it could handle, leaving patients out in the cold. Its remaining 22 locations will shutter in February. Check out the store closures here.The CEOs that are taking massive pay cuts. The economic downturn has hammered tech companies. In response to the harsher conditions, prominent CEOs including Apple's Tim Cook and Intel's Pat Gelsinger have voluntarily cut their pay. Get the full list here.Why most returned items end up in landfills. According to an estimate by tech platform Optoro, as many as 9.6 billion pounds of returns ended up in landfills in 2021. That's equivalent to 10,500 fully loaded Boeing 747s. The simple reason for this is cost. Dive into this trash-hole with us here.Twitter suffered one of its largest outages ever. Users on Wednesday were suddenly unable to tweet, direct message, or follow people on the platform. Inside the company, it was a "scramble" to find the source of the problem. Read more here. The biggest lessons after driving 20 electric cars. Insider's EV maven Tim Levin faced a road trip disaster in one vehicle. Then, he experienced a "face-melting rip" in the world's fastest supercar. Gather round for EV storytime here.Odds and ends:Williams in Alaska.Taryn Williams/Insider"I moved to a tiny Alaskan village to be a teacher." Taryn Williams told Insider what living and working in a village of 89 people is like. She teaches five students and lives off the land. Check out her story (with photos!) here.Enter the life of the FBI's former chief New York spy hunter. Charlie McGonigal lived a double life. He's an FBI spy hunter who was charged with taking money from a sanctioned Russian oligarch. Now, he's facing two federal indictments. Dive into his life of greed and espionage here.What we're watching today:New York Fashion Week Women's Fall/Winter 2023 begins.Paramore headlines the first night of the Bud Light Super Bowl Music Fest. Ain't it fun?Quarterly earnings for Lyft, PayPal, and other companies. Keep up with earnings here.Another court hearing for FTX founder Sam Bankman-Fried. He's facing money laundering and conspiracy to commit fraud charges. If you don't know anything about crypto, here's Insider's guide to catch you up on the SBF saga.Curated by Diamond Naga Siu in San Diego. (Feedback or tips? Email or tweet @diamondnagasiu) Edited by Matt Weinberger in San Francisco and Hallam Bullock in London.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderFeb 9th, 2023

How 5 major streaming services are cracking down (or not) on password sharing, from Netflix to Hulu

As Netflix prepares to charge for account sharing early this spring, other streaming services have been slower to take a stance on password swapping. Streaming services are struggling to navigate password sharing.grinvalds/Getty Images Netflix will start charging for password sharing by the end of March, according to the company. Other services like HBO Max have traditionally struck a different tone on sharing. Netflix expects to see increased revenue after the rollout, according to a letter to shareholders. While Netflix prepares to end free password sharing, other streaming companies have avoided taking a hard stance on the matter. The company is making good on its promise to stop users from accessing the service without paying for their own account, announcing Wednesday it will soon roll out a paid-sharing model. Netflix has already rolled out a similar program in some South American countries, allowing users to pay $2 or $3 dollars to add a member to their accounts. Notably, password sharing is against the terms of service of virtually every streaming service, and a federal court ruling in 2016 upheld a conviction of password theft under a 1980s anti-hacking law. Still, services like HBO Max, Amazon Prime Video, Apple TV+, and Hulu each have their own methods for preventing — or allowing — users to share their accounts.Here's a look at the current state of password streaming among the major streamers. Netflix will introduce its paid-sharing account before the end of March.Netflix will introduce its paid-sharing account before the end of March.Jakub Porzycki/NurPhoto via Getty ImagesWhile the streaming industry navigates password sharing, attempting to strike a balance between usability and profit, some experts have said policies like the one coming to Netflix can be hostile. "A password crackdown across the industry would lead to more volatility because people will swing to the content that they want," consultant Stephen Beck told Marketing Brew in an Interview. "They won't stick around on that service for the periods of time when the content is not fresh and not interesting." While Netflix anticipates the new policy may lead to cancellation, it said in a letter to shareholders last week it anticipates an overall increase in revenue. "We expect to see some cancel reaction in each market as we roll out paid sharing, which impacts near term member growth," the letter reads. "But as borrower households begin to activate their own standalone accounts and extra member accounts are added, we expect to see improved overall revenue." HBO Max allows users to share passwords, but the streaming service is changing rapidly.SOPA Images/ShutterstockHBO Max largely struck an indifferent tone around password sharing before WarnerMedia, which owned the service, merged with Discovery last spring.Executives at AT&T, which formerly owned WarnerMedia, indicated that HBO Max has been able to manage password sharing effectively without a large-scale crackdown, Deadline reported.However, a new life is on the horizon for the streaming service, as HBO Max prepares to merge with Discovery+ this spring, creating a new streaming service set to launch this summer, Insider's Travis Clark reported in August. It's unclear how the new service might handle password sharing after it launches, but for now HBO Max users seem to have no trouble borrowing passwords from one another. Hulu lets users share passwords, but has been strict on sharing live TV.HuluHulu has typically allowed password sharing to continue on most accounts, but access to live TV can be restricted for some users sharing passwords. Users on accounts with access to live TV must intermittently login at the home where the account is based in order to continue access to live programming, according to the company's website. Amazon Prime Video allows users to add members for free, with some restrictions.Katja Knupper/Die Fotowerft/DeFodi Images via Getty ImagesAmazon takes a slightly more friendly approach to password sharing in some instances, offering households the ability to merge accounts and add users for free. Amazon Prime members can share some of their benefits, including access to Prime Video, with other members in their household. The Amazon Household feature, however, restricts access to a max of two "adults," four "teens,"  and four "children." Adults are defined as users over the age of 18, and teens range ages 13-17, according to Amazon. Apple TV+ has a sharing feature which allows up to six accounts.Rafael Henrique/SOPA Images/LightRocket via Getty ImagesApple TV+ has a Family Sharing feature which allows account holders to share video access with up to six users for free. The streaming account must be linked directly with an Apple ID, and the account holder is responsible for any purchases made by members with access, according to Apple. Apple TV+ users can also invite users with different Apple IDs to join their "family," granting them access to the service.  Read the original article on Business Insider.....»»

Category: smallbizSource: nytJan 28th, 2023

Tesla Beats On Top And Bottom Line As Margins Slump

Tesla Beats On Top And Bottom Line As Margins Slump As previewed earlier, analysts are expecting Tesla to post earnings of $1.02 per share, and $24.1 billion in revenue, with the stock having been hammered in early 2023 before rebounding solidly over the past 2 weeks. Needless to say, 2022 was ugly for Tesla: it's share price tumbled 65% during the worst ever year for the company, taking the automaker out of the rarefied trillion-dollar-valuation club, and cost it the position of the fifth-biggest company on the S&P 500 Index. Turning back to the earnings, focus will be around the company's lackluster Q4 delivery figures which, although a new record, fell short of Wall Street expectations. There will also be a looming question about margins with Tesla's recent price cuts, though pressure from the sales may not show up until Q1 2023 figures. Adjusted EPS: $1.02 Revenue estimate $24.07 billion Automotive gross margin estimate +28.4% Gross margin estimate 25.4% Capex estimate $1.9 billion Free cash flow estimate $3.12 billion Cash and cash equivalents estimate $22.71 billion This will also be the first earnings call since Musk completed his acquisition of Twitter: it will be interesting if Musk will will (or will allow) questions about the impact of that decision on Tesla’s brand. Meanwhile, Tesla continues to grow the number of owners who are trying the beta version of its so-called “Full Self-Driving” software, so expect to hear more about that tonight. That’s a crucial technological milestone for Tesla, but also one that could unlock more than a billion dollars of deferred revenue at some point. That said, Tesla has promised fully autonomous cars for the better part of a decade now. So with all that in mind, here is what Tesla reported moments ago (pdf link): Revenue was a record $24.318BN, up 37% Y/Y, beating the consensus estimate of $24.1BN Adj EPS $1.19, up 40% Y/Y, and also beating the consensus estimate of $1.12 Free cash flow $1.42BN, down 49% Y/Y, and missing estimates of $3.13BN Capital expenditure $1.86 billion, up 3%, missing estimates of $1.9 billion Bottom line: Tesla reported better-than expected profits amid growing skepticism about the auto industry, and signaled strength as it faces growing questions about demand for its all-electric vehicle lineup. And while the top and bottom lines both beat, it came at a cost to margins: in Q4, Tesla's Automotive Gross Margin was +25.9%, down a whopping 466bps from 30.6%,  and missing the estimate of +28.4%. The reason for this sharp drop in margins most likely has to do with the company's creeping price cuts and still rising commodity costs. The drop in the automotive gross margin also hit the total gross margin, which dropped to 23.8% vs. 27.4% y/y, and also missed the estimate of 25.4%. This is how the company spun the shrinkage in margins: "our ASPs have generally been on a downward trajectory for many years. Improving affordability  is necessary to become a multi-million vehicle producer." Visually: Of note: the company's regulatory credits added $467 million to revenue, meaning the difference between the miss and a beat; the number was a 49% increase Y/Y, and the third highest quarter for reg credits on record. It wasn't just reg credits however: Tesla also recognized a material $324 million of FSD revenue this quarter. The company has said that software will be a growing part of revenue going forward. By recognizing such a big chunk of deferred revenue thanks to expanding access to FSD Beta, Tesla’s deferred revenue declined quarter-on-quarter for the first time in a while, though it’s still sitting pretty high at $1.74 billion. And speaking of other liabilities, Tesla saw its second straight quarterly drop in customer deposits, which dropped modestly to $1.06 billion from $1.083 billion, after hitting an all-time high of $1.1 billion exiting Q2 in 2022. Like most other companies, Tesla was also impacted by negative FX impact, which hit revenue by $1.4BN, and profit by $300MM: Some other headlines from the report: Cybertruck on Track to Begin Production Later This Yr Next Generation Vehicle Platform Is Under Development Will Share Added Details at March Investor Day Tesla said that in Q4, each of its factories produced a record number of vehicles and continued a gradual shift "toward a more even regional mix of production and deliveries." Tesla also confirmed it’s still on track to start building the Cybertruck in Austin later this year and adds that it will discuss more details of its next-generation vehicle platform at the upcoming investor day on March 1. The company also said that it expect to remain ahead of its Long-Term 50% average annual growth in vehicle deliveries. The  EV market leader said it would increase output “as quickly as possible”and said it is on track to deliver about 1.8 million vehicles this year.  To meet this output increase, Tesla doubled its production capacity in 2022 and increased its production each quarter. According to Bloomberg, its annualized production estimate for the fourth quarter was a new record, and near the company’s total production capacity for the first time. To be sure, the overall tone in the latest letter was quite optimistic in general: “Our relentless cost control and cost innovation is why we believe that no other OEM is better equipped to navigate through 2023, and ultimately succeed in the long run, than we are.” Elsewhere, Tesla confirmed it’s still on track to start building the Cybertruck in Austin later this year and adds that it will discuss more details of its next-generation vehicle platform at the upcoming investor day on March 1. Tesla said that it has released FSD Beta to nearly all customers who bought it (nearly 400,000). Shifting away briefly from the generally solid automotive results, the company also had a solid quarter for solar deployments: in Q4 the company deployed a total of 100 megawatts. That’s above the 94 megawatts of 3Q, but below the 106 megawatts in 2Q. Still, that’s about double what Tesla had been doing per quarter before last year Storage deployed inched up, this time to 2,462 megawatt-hours in 4Q. Tesla is a clear industry leader in batteries. Tesla says demand for its storage products exceeds its ability to supply. While the company is now profitable (and FCF positive), few are worried about it running out of cash, yet it is interesting that Tesla entered into a credit agreement on Jan. 20 that provides for a senior unsecured revolving facility of up to $5 billion, and the company may increase total commitments by up to an additional $2 billion. Underwriters are Citibank, (administrative agent) and Deutsche Bank Securities. Naturally, with substantial cash (over $22BN), no loans were outstanding under the Credit Facility as of January 25, 2023 The market reaction was surprisingly muted, and after the stock dumped and pumped after the results, it has remained largely unchanged from its closing level around $144. As Bloomberg notes, the lack of a big stock reaction in Tesla after the results may come as a surprise to some market participants: options pricing implied a possible 11% move in the shares in either direction, after the earnings. It got 0%. Attention now turns to the earnings call where Musk may or may not be present. Tyler Durden Wed, 01/25/2023 - 16:47.....»»

Category: smallbizSource: nytJan 25th, 2023

"Leave Him Alone!!!": Trump Defends Pence After Discovery Of Classified Documents At Indiana Home

"Leave Him Alone!!!": Trump Defends Pence After Discovery Of Classified Documents At Indiana Home Authored by Frank Fang via The Epoch Times (emphasis ours), Former President Donald Trump defended former Vice President Mike Pence on Tuesday, after classified documents were found at Pence’s home in Indiana. “Mike Pence is an innocent man. He never did anything knowingly dishonest in his life. Leave him alone!!!” Trump wrote on his Truth Social account on Jan. 24. Former Vice President Mike Pence gestures as he speaks during a Republican Jewish Coalition Annual Leadership Meeting in Las Vegas on Nov. 18, 2022. (Wade Vandervort/AFP via Getty Images) Pence’s lawyer, Greg Jacob, told the National Archives and Records Administration in a Jan. 18 letter that a “small number of documents” marked classified were found at Pence’s Indiana home two days earlier. The documents were “inadvertently boxed and transported” to the former vice president’s home at the end of the Trump–Pence administration. The discovery came after Pence engaged outside counsel to review records stored at his residence, according to Jacob, who added that the classified documents were “immediately secured” in a locked safe. “Vice President understands the high importance of protecting sensitive and classified information and stands ready and willing to cooperate fully with the National Archives and any appropriate inquiry,” Jacob wrote. FBI agents visited Pence’s residence on Jan. 19 and collected the documents that had been secured, according to Jacob. At the time, Pence was in Washington to attend the March for Life rally. Former President Donald Trump speaks at the Conservative Political Action Conference at the Hilton Anatole in Dallas, Texas, on Aug. 6, 2022. (Brandon Bell/Getty Images) The discovery of classified documents at Pence’s home came on the heel of investigations by the Department of Justice over classified documents found in President Joe Biden’s Delaware home and his former office space in Washington, as well as in Trump’s Mar-a-Lago estate in Florida. White House press secretary Karine Jean-Pierre did not comment on Tuesday when a reporter asked if the White House had any reaction to Pence’s documents. “I’m not going to comment on any ongoing criminal investigation or any investigation,” she said. “As you all know, the Department of Justice is independent, and we will not politically interfere.” Congress The news of the discovery of classified documents at Pence’s residence has generated mixed responses from lawmakers. House Committee on Oversight and Accountability Chairman James Comer (R-Ky.) issued a statement saying that Pence has agreed to work with congressional oversight. “Former Vice President Mike Pence reached out today about classified documents found at his home in Indiana,” Comer wrote. “He has agreed to fully cooperate with congressional oversight and any questions we have about the matter. “Former Vice President Pence’s transparency stands in stark contrast to Biden White House staff who continue to withhold information from Congress and the American people.” On Jan. 22, Comer accused the White House of “stonewalling” a Republican investigation into Biden’s handling of classified documents. Rep. Jamie Raskin (D-Md.), ranking member of the House Committee on Oversight and Accountability, issued a statement saying it was important for the Department of Justice to conduct its probes. “It is critical that we allow the Justice Department to carry out its investigations and follow the facts in specific cases, and we should work together on a bipartisan basis to improve all relevant federal policies and practices,” Raskin wrote. “There is plainly a lot of work to do.” Sen. Lindsey Graham (R-S.C.) wrote on Twitter on Jan. 24 that he believed neither Biden, Trump, nor Pence had anything “sinister” over how they handled classified documents. “I don’t believe there were ‘sinister motives’ with regards to the handling of classified information by President Biden, President Trump, or Vice President Pence,” Graham wrote. “We have a classified information problem which needs to be fixed.” Special Counsel Rep. Matt Gaetz (R-Fla.) said it remains to be seen whether Attorney General Merrick Garland would appoint a special counsel to investigate Pence. “Whether or not Mike Pence gets a special counsel for classified documents found at his residence is dependent on if he announces that he is running for president,” Gaetz wrote on Twitter. Read more here... Tyler Durden Wed, 01/25/2023 - 15:45.....»»

Category: personnelSource: nytJan 25th, 2023

Netflix Surges After Sub Growth Smashes Expectations, Resumes Buybacks, Hastings Steps Down As CEO

Netflix Surges After Sub Growth Smashes Expectations, Resumes Buybacks, Hastings Steps Down As CEO Recent earnings reports from streaming giant Netflix had been a veritable rollercoaster horrorshow: the stock soared to an all time high two years ago when Netflix reported a blowout subscriber beat and projected it would soon be cash flow positive - if only briefly before again reversing and then tumbling seven quarters ago when Netflix again disappointed after it reported a huge subscriber miss and giving dismal guidance, leading to the second quarter when Netflix slumped again after the company missed estimates and guided lower. This again reversed five quarters ago when Netflix soared after it blew away expectations and guided to a blowout Q4, only to plummet one year ago when the company's stock crashed after NFLX reported a dismal subscriber miss for Q4 and gave horrific guidance for the current quarter. Then three quarters ago, the stock absolutely imploded, plummeting 20% in seconds after the company reported the loss of 2 million subs in Q2 and forecast catastrophic earnings. Then two quarters ago, when there was almost no more muscle to cut, the stock finally jumped after reporting a smaller than expected subscriber loss. The upside trend continued last quarter when NFLX again surged when the company reported solid subscriber growth for Q3 with a forecast that topped expectations. In short, after the shares tumbled on 4 of the past 8 earnings releases, and obviously surged on the other 4, it's been a dizzying rollercoaster, with the shares losing almost 50% of their value since the start of 2022 - one of the most oversold tech stocks of the past year - yet up almost 100% from its June 2022 lows. Heading into today's earnings, Citigroup analyst Jason Bazinet said the focus will be on fourth-quarter subscribers, the forecast for first-quarter revenue, the profit outlook, and any commentary regarding the new cheaper ad-supported tier that started during the quarter. In a note to clients, he said the ad-supported tier was only offered in 12 markets and “likely had a slow start” but will help lift the shares over time.  In a sign of how seriously Netflix is taking the advertising opportunity, the company said Wednesday it is expanding its relationship with Nielsen, the long-time leader in TV ratings. Coincidentally, Nielsen reported its latest streaming data on Thursday morning. Netflix had a 7.5% share of the overall time people spent watching TV in December, larger than all other streamers but YouTube. Netflix remains the dominant player by other measures, though, accounting for seven of the 10 most-watched shows on streaming in mid-December. Meanwhile, Wells Fargo analyst Steven Cahall said Netflix’s comments about cracking down on password sharing will be the big focus of today’s earnings call. “As the Street better understands password sharing we see it as upside to revenue growth estimates,” he said in a note to clients Wednesday. Bloomberg Intelligence analyst Geetha Ranganathan had a bullish take, saying that things are finally falling in place for Netflix, as a solid content slate that included hits like Wednesday and Glass Onion could help it easily meet and possibly exceed guidance for 4.5 million more subscribers in the fourth quarter: "Though investors will be looking for color on the adoption of its ad-supported tier, which debuted in November, we expect this to be a slow build that will eventually boost average revenue per user and revenue through 2023, especially when combined with a crackdown on password sharing.” Analysts at MoffettNathanson had a more bearish view warning that Netflix has “hit subscriber maturity” in the US, Canada and Western Europe, and it now faces “a number of strategic challenges that cloud future earnings and cash-flow growth prospects.” Among them, they said, are creating an option with ads that creates an attractive price point for consumers to sign up without creating “a high degree of spin-down behavior,” meaning subscribers switching from high price ad-free tiers to lower ad-included price tiers. So with all that in mind, here are the details from the fourth quarter letter with news hitting moments before the results that CEO Reed Hastings is stepping down as CEO: Q3 Revenue $7.85 billion, +1.9% y/y, in line with the estimate $7.86 billion Q3 EPS 12c vs. $1.33 y/y, missing the estimate 42c But while the financials were ok, it was the blowout number of subscriber adds that blew away expectations, and that everyone is focusing on: Streaming paid net change +7.66 million, down modestly -7.5% y/y, but smashing the estimate +4.5 million UCAN streaming paid net change +910,000, -24% y/y, beating the estimate +553,653 EMEA streaming paid net change +3.20 million, -9.6% y/y, beating the estimate +1.3 million LATAM streaming paid net change +1.76 million, +81% y/y, beating the estimate +727,190 APAC streaming paid net change +1.80 million, -30% y/y, beating the estimate +1.9 million Streaming paid memberships 230.75 million, +4% y/y, beating the estimate 227.3 million Operating margin 7% vs. 8.2% y/y, beating the estimate 4.45% Operating income $550 million, -13% y/y, beating the estimate $393.2 million Free cash flow $332 million vs. negative $569 million y/y, below the estimate of negative $199.2 million The good news: after two quarter of subscriber declines, the company is now seeing two consecutive quarters of sharp subscriber growth. That said, Netflix admitted that “2022 was a tough year, with a bumpy start but a brighter finish.” It adds that “we believe we have a clear path to re-accelerate our revenue growth: continuing to improve all aspects of Netflix, launching paid sharing and building our ads offering.” Predictably, the company wasted no time to pat itself on the back for its solid Q4 results: "Q4’22 revenue, operating profit and membership growth exceeded our forecast - we continue to lead the industry in streaming engagement, revenue and profit. Our Q4 content slate outperformed even our high expectations: Wednesday was our third most popular series ever, Harry & Meghan our second most popular documentary series, Troll our most popular non-English film, and Glass Onion: A Knives Out Mystery our fourth most popular film . We delivered on the high end of our operating profit margin target for full year 2022, and we expect to increase our operating margin in 2023 vs. 2022. For 2022, we finished with 231M paid memberships and generated $32B of revenue, $5.6B in operating income, $2.0B of net cash from operating activities and $1.6B of free cash flow (FCF). In 2023, we expect at least $3B of FCF, assuming no material swings in F/X." Addressing the elephant in the room - its new, lower-priced ad-supported plan which launched in November - Netflix said “we are pleased with our progress to date across every dimension" adding that the lower price point is “driving incremental membership growth,” and it’s seen “very little switching” from other plans. But Netflix also warns that revenue and profit growth from the new initiative this year “will be modest given that this will build slowly over time.” Some more details on the various price tiers including paid sharing: Later in Q1, we expect to start rolling out paid sharing more broadly. Today’s widespread account sharing (100M+ households) undermines our long term ability to invest in and improve Netflix, as well as build our business. While our terms of use limit use of Netflix to a household, we recognize this is a change for members who share their account more broadly. So we’ve worked hard to build additional new features that improve the Netflix experience, including the ability for members to review which devices are using their account and to transfer a profile to a new account. As we roll out paid sharing, members in many countries will also have the option to pay extra if they want to share Netflix with people they don’t live with. As is the case today, all members will be able to watch while traveling, whether on a TV or mobile device. As we work through this transition – and as some borrowers stop watching either because they don’t convert to extra members or full paying accounts – near term engagement, as measured by third parties like Nielsen’s The Gauge, could be negatively impacted. However, we believe the pattern will be similar to what we’ve seen in Latin America, with engagement growing over time as we continue to deliver a great slate of programming and borrowers sign-up for their own accounts. Looking ahead, Netflix no longer discloses detailed estimates of subscriber growth for future quarters, instead focusing purely on financial metrics which for Q1 are largely in line with consensus: Q1 revenue $8.17 billion, in line with the median analyst estimate of $8.17 billion EPS $2.82, missing the estimate $2.99 Operating margin 19.9%, missing the estimate 21.7% Free Cash Flow $3BN for 2023, beating the estimate of $2.41BN Expects to increase operating margin in 2023 vs. 2022 Now expects to deliver roughly 21%-22% operating margin in FY23 based on F/X rates at the beginning of 2022 More details from the company's forecast which also while no longer disclosing new subs, notes that it expects "modest positive paid net adds in Q1 ‘23 (vs. paid net adds of -0.2M in Q1’22)" and adds that "fewer paid net adds in Q1’23 vs. Q4’22" is "consistent with normal seasonality and factors in our strong member growth in Q4’22, which likely pulled forward some growth from Q1’23." In other words, NFLX picked the perfect time to stop disclosing new subs. Here is what else it said: As we noted in our Q3’22 shareholder letter, revenue is our primary top line metric, particularly as we develop additional revenue streams where membership is just one component of our growth (like advertising and paid sharing). The quarterly guidance we provide is our actual internal forecast at the time we report. As always, we strive for accuracy although the rollout of major new initiatives (paid sharing and ads) plus current uncertain macroeconomic environment leads to less-than-normal visibility. We forecast Q1’23 revenue growth of 4% (8% on a F/X neutral basis). We expect our F/X neutral revenue growth to be driven by a combination of year over year growth in average paid memberships and ARM. This translates into modest positive paid net adds in Q1 ‘23 (vs. paid net adds of -0.2M in Q1’22). Our expectation of fewer paid net adds in Q1’23 vs. Q4’22 is consistent with normal seasonality and factors in our strong member growth in Q4’22, which likely pulled forward some growth from Q1’23. In addition, we expect to roll out paid sharing more broadly later in Q1’23 (more details below in the Product and Pricing section). We anticipate that this will result in a very different quarterly paid net adds pattern in 2023, with paid net adds likely to be greater in Q2’23 than in Q1’23. From our experience in Latin America, we expect some cancel reaction in each market when we roll out paid sharing, which impacts near term member growth. But as borrower households begin to activate their own standalone accounts and extra member accounts are added, we expect to see improved overall revenue, which is our goal with all plan and pricing changes More importantly to some investors, the company anticipates "resuming share buyback program in 2023" while its "long term financial objectives remain unchanged - sustain double digit revenue growth, expand operating margin and deliver growing positive free cash flow" and the following details:  We have been targeting a FY23 operating margin of 19%-20% based on F/X rates at the beginning of 2022. We now expect to deliver roughly 21%-22% operating margin on this basis (above the 19%-20% range). Rolling forward to F/X rates as of January 1, 2023, this translates into a FY23 operating margin target of 18%-20%. For Q1’23, we expect operating margin to be down year over year (20% vs. 25%) due primarily to the timing of content spend. Turning to cash flow, NFLX announced that net cash generated by operating activities was $0.4B in Q4’22 (vs. -$0.4B in the prior year period) and $2.0B for FY22 (vs. $0.4B in FY21). Free cash flow (FCF) for Q4 totaled $332, compared with -$569MM in the year ago quarter. For FY22, the company generated FCF of $1.6B (vs. -$0.2B in FY21), above its forecast of approximately $1B. The company says that "Now that we are a decade into our original programming initiative and have successfully scaled it, we are past the most cash intensive phase of this buildout. As a result, we believe we will now be generating sustained, positive annual free cash flow going forward. Assuming no material swings in F/X, we expect at least $3B of FCF for the full year 2023." Turning to the cap table, the company's debt at quarter end totaled $14B; with cash and short term investments of $6B, net debt totaled $8B, or 1.3x LTM EBITDA. There are no scheduled debt 7 maturities in FY23 and only $400M of debt maturities in FY24 (all of our debt is fixed rate). As noted above, NFLX says that its capital structure policy is unchanged, and the "first priority for our cash is to reinvest in our core business and to fund new opportunities like gaming, followed by selective acquisitions." NFLX is targeting maintaining minimum cash equivalent to roughly two months of revenue (e.g., about $5.2B based on Q4 revenue). After meeting those needs, NFLX intend to return cash to stockholders through share repurchases, and assuming no material acquisitions, it anticipates resuming our share buyback program in 2023. Here is our buyback math: NFLX plans on keeping a minimum cash equivalent to 2 months of revenue ($5.2B based on Q4 revenue). It currently has $6BN in cash, so it will buy back ~$1BN in stock. For 2023 it plans on generating  another $3BN in cash, so up to ~$4BN in buybacks. * * * Besides Q4 earnings, the company also reported the very material news that the company's founder, Reed Hastings, is stepping down as chief executive in a shake-up at the top of one of the most powerful studios in Hollywood. Hastings, who launched Netflix in 1997 as a DVD-by-mail service, wrote in a blog post that he has been increasingly delegating management in recent years. Now is “the right time to complete my succession”, he added. He will stay on as the company's executive chairman. To replace Hastings, chief operating officer Greg Peters has been promoted as co-chief executive with Ted Sarandos, who was in charge of programming during Netflix’s massive investment period and promoted in 2020 to co-chief executive alongside Hastings. The change comes as Netflix has lost more than a third of its market value in the past year, after revealing its decade-long growth spurt had come to an end. Sarandos and Peters will be charged with regaining momentum and leading Netflix through a more austere era for the entertainment industry. As Bloomberg notes, Reed Hastings stepping aside as CEO is not an entirely unexpected event. And he notes in his blog post he’s not leaving entirely. He promoted Ted Sarandos to co-CEO and Greg Peters to COO 2 1/2 years ago. The three of them have worked together for 15 years. “We’ve all learned how to bring out the best in each other,” Hastings wrote. “I look forward to working with them in this for many years to come.” “Our board has been discussing succession planning for many years (even founders need to evolve!)”, Hastings, 62, wrote. “I’m so proud of our first 25 years, and so excited about our next quarter of a century” * * * Commenting on the Q4 results, Bloomberg Intelligence senior industry analyst Geetha Ranganathan says the results show Netflix is set up well for the fiscal year. “4Q has traditionally been a strong quarter for them, and what they’ve done really really well in terms of execution in the third quarter and the fourth quarter was a steady cadence of content hits... What this tells investors is that they have a steady pipeline of more and more hits, and more and more predictable hits. Not just a sleeper every once in a while. That gives us confidence that they should be able to monetize that, whether it’s through pay sharing, whether it’s through the ad-supported tier and other efforts.” The market clearly agrees and while the stock initially dumped as much as 4% on news of the Hasting resignation, it has since spiked as much as 8% and was settling about 6% higher around 5pm ET ahead of the conference call. Tyler Durden Thu, 01/19/2023 - 16:15.....»»

Category: blogSource: zerohedgeJan 19th, 2023

We could soon be facing the biggest financial crisis in history as Republicans threaten to stop paying America"s bills

Republicans are using the debt ceiling as a bargaining chip, and their actions could torpedo the economy in the process. Speaker of the House Kevin McCarthy (R-CA)Chip Somodevilla/Getty Images Republicans are using the debt ceiling as leverage to achieve spending cuts on Democratic priorities. But failing to raise the debt ceiling by the summer could cause the US to default on its debt. Consequences of default are dire, and Biden has urged the GOP to not bargain with the debt limit.  Republican lawmakers could torpedo the economy if they don't act soon.Drama has been infiltrating the halls of Congress over the past few weeks. Due to squabbling among the GOP, it took some late nights — and 15 ballots — to elect Kevin McCarthy as Speaker of the House. But it appears that was the easy part, as Republicans are now contending with a bigger, and much riskier challenge: raising the debt ceiling and keeping America on top of paying its bills.Treasury Secretary Janet Yellen has warned that the debt limit is looming, with the US projected to officially reach the statutory limit for borrowing on January 19. That's when the Treasury will step in with "extraordinary measures" — shuffling around some spending related to federal employee pension plans — until it's either funded again or runs out of options and becomes unable to pay its bills. "Failure to meet the government's obligations would cause irreparable harm to the U.S. economy, the livelihoods of all Americans, and global financial stability," Yellen wrote in a letter to McCarthy.Those "extraordinary measures" are expected to run out sometime this summer, at which point the US could find itself in a dire economic situation. The country — and world — could plunge into a financial crisis, destabilizing global markets and leaving millions of Americans jobless. What's different this timeThis isn't a new dilemma for lawmakers. Raising the debt ceiling means increasing the legal amount of debt the federal government is able to allocate to keep paying for programs already mandated by Congress, and it's something Republicans managed to do three times under former President Donald Trump.But with a Democratic White House, this time around is different because Republicans are planning to use the debt ceiling as leverage to accomplish their own policy priorities — largely significant spending cuts on things like Medicare and Social Security. The White House, and Democratic lawmakers, have blasted the GOP using the debt limit as a bargaining chip."Failure to raise the debt limit will not reduce our debt, but it would wreck the economy if it led to a default. Unfortunately many Republicans seem determined to find out how catastrophic a default would be through experience," Rep. Don Beyer, a Democrat from Virginia, said in a statement to Insider.He added: "Republicans accorded President Trump clean, bipartisan debt limit increases to cover the costs of debts which many of them voted to incur, and there is no reason for them to refuse to do the same under President Biden other than pure partisan politics.""In exchange for not crashing the United States economy, you get nothing," Hawaii Sen. Brian Schatz previously told The Daily Beast. "You don't get a cookie. You don't get to be treated like you're the second coming of LBJ. You're just a person doing the bare minimum of not intentionally screwing over your constituents for insane reasons."Michael Strain, the director of economic policy studies at the American Enterprise Institute, a center-right think tank, wrote that the Biden administration and Democrats have to accept the reality that "House firebrands" are not bluffing about not reaching a deal."All responsible politicians must get to work immediately, with the goal of raising the ceiling this winter," Strain wrote. "The closer we get to the as-yet-unknown day this summer when the government will run out of borrowing power, the worse the market reaction will be."This isn't the first time the debt ceiling has been caught in political crosshairsIf the challenge to raise the debt ceiling sounds familiar, that's because Congress was in a very similar situation two years ago. Senate Minority Leader Mitch McConnell initially refused to help Democrats raise the limit in 2021, leading the US dangerously close to defaulting on its debt before agreeing to a short-term agreement that raised the debt ceiling to its current level.That obstruction harkened back to 2011, when delays in raising the ceiling amidst negotiations between the Obama administration and Republicans resulted in $1.3 billion more in borrowing costs and the US's S&P credit rating getting downgraded. In 1995, a standoff between President Bill Clinton and Republicans over spending cuts led to a government shutdown and Moody's saying it would potentially downgrade Treasury bonds — leading Republicans to acquiesce. This time could be different, however, as the new GOP House majority appears particularly insistent on playing hardball. "I think in the past, the assumption or the strategy was we want the Republicans to yield," Rohan Grey, an assistant professor at Willamette University College of Law, said. "We want to play a game of chicken with them because we think they don't actually want to be responsible for blowing up the whole economy."But, Grey said, while Mitch McConnell did ultimately blink, this group of Republicans is a "fundamentally different group of people."Goldman Sachs' Alec Phillips wrote in a January 9 analysis that the debt limit is now "a greater risk than at any time since 1995 or 2011," when the government shut down, or came close to shutting down, to avoid missing payments.Phillips explained that passing a bill to raise the debt limit, along with spending cuts McCarthy conceded to, would be difficult to implement because the cuts "would primarily impact seniors, a Republican-leaning demographic.""This could be the most economically irresponsible backroom deal in Republican history (even conservative economists are warning that the consequences could include a stock-market spiral and significant job losses)," Robert Reich, the Secretary of Labor during the 1995 debt ceiling crisis, wrote in a piece on the current situation.Zachary D. Carter, the author of "The Price of Peace: Money, Democracy and the Life of John Maynard Keynes," told Insider a default on the national debt would throw the country back to some of the worst days after the Great Recession in 2008, he said, but with even more severe risks. The US Treasury bond "is the basic unit of global finance," Carter said. "We are talking about every single financial institution in the world having to suddenly revalue the price of a basic asset that is used to settle balances every day.""We'd just be setting off a global financial crisis. What happens after that? No one knows," he added.U.S. Treasury Secretary Janet YellenChip Somodevilla/Getty ImagesBiden could get past the debt ceiling without CongressIf Biden ultimately decides he wants to avoid the risky debate in Congress, another solution is waiting for him in the form of a $1 trillion platinum coin. Through a process known as "minting the coin," Biden could sidestep Congress by depositing a $1 trillion platinum coin in the Federal Reserve, keeping the US afloat without having to formally issue any new debt. The coin concept comes from a loophole in the type of coins the Treasury Department can mint. The Department has the jurisdiction to mint "platinum bullion coins and proof platinum coins in accordance with such specifications, designs, varieties, quantities, denominations, and inscriptions as the Secretary, in the Secretary's discretion, may prescribe from time to time." Under that wording, the platinum coin could be any value — so, theoretically, Treasury Secretary Janet Yellen could mint a platinum coin, say it's worth a trillion dollars, and use that to resolve the issue."When you talk about the trillion dollar platinum coin, it sounds very silly — and it is really silly!" Carter said. "But a silly thing is much better than a catastrophic thing."Obama even considered the idea, saying in 2017 that there "were all kinds of wacky ideas about how potentially you could have this massive coin." (The coin does not have to be physically large, just worth a trillion dollars).While it may seem like a radical solution, "the really radical thing about this is the Treasury Secretary and others saying, we are going to ignore our constitutional responsibilities to spend the amount that Congress has told us to spend — because we don't like the tools that they've given us to do it," Grey said, referring to the contradiction between Congressionally-mandated appropriations and the debt ceiling. But at this point, Biden has rejected going that route and his administration maintains that Congress must act to ensure the US continues paying its bills, and doing so should not be a matter of negotiation."This is just another attempt by congressional Republicans to force unpopular cuts on programs critical to seniors, the middle class and working families," White House Press Secretary Karine Jean-Pierre said on Tuesday. "Congress needs to act and do so quickly. There is no excuse for political brinkmanship."Additionally, The Washington Post reported last week that McCarthy and House Republicans are preparing a "payment prioritization" plan that would tell the Treasury what to do should Congress fail to raise the debt ceiling. Jean-Pierre called the plan "a recipe for economic catastrophe."Widespread job losses, coupled with a roiled global economy, could take place if Congress doesn't act. "We would see a financial crisis and massive job losses without aid from the federal government to deal with it," Carter said. "You would see very serious material hardship, very widespread, very quickly." Read the original article on Business Insider.....»»

Category: dealsSource: nytJan 19th, 2023

How To Protect Airline Passengers With Life-Threatening Allergies

How to Protect Airline Passengers With Life-Threatening Allergies; Use Simple Tactics Which Worked For Smoke-Sensitive Passengers Protecting Airline Passengers  WASHINGTON, D.C. (January 16, 2023) – Millions of airline passengers who have serious life-threatening allergies to foods served or sometimes brought onto airplane flights are regularly being denied the protection to which they are legally entitled, […] How to Protect Airline Passengers With Life-Threatening Allergies; Use Simple Tactics Which Worked For Smoke-Sensitive Passengers Protecting Airline Passengers  WASHINGTON, D.C. (January 16, 2023) – Millions of airline passengers who have serious life-threatening allergies to foods served or sometimes brought onto airplane flights are regularly being denied the protection to which they are legally entitled, according to the Wall Street Journal and other sources. But a tactic which protected passengers with allergies and/or special sensitivities to secondhand tobacco smoke might help to solve the problem and perhaps save lives, says public interest law professor John Banzhaf. if (typeof jQuery == 'undefined') { document.write(''); } .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 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 Henry Singleton Series in PDF Get the entire 4-part series on Henry Singleton 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); Q4 2022 hedge fund letters, conferences and more   More than 30 million Americans, including 6 million children, have food allergies, primarily to milk, peanuts, and tree nuts. While some conditions may not be very serious, a few passengers are so sensitive that merely touching a surface on which nuts or other foods have rested can trigger a life-threatening condition called anaphylaxis. Which causes swelling, hives, lowered blood pressure, medical shock, and most importantly construction of the airways - which can cause death in less than 15 minutes, or at very least may require hospitalization. That's why those who can suffer a severe allergic reaction from certain foods need to be able to preboard flights in order to clean their seats (including arm rests) and tray tables (usually with antibacterial wipes), says the Journal, citing a case where such a passenger found his tray table covered in food crumbs. The Department of Transportation [DOT] ruled in 2019 that: "Section 382.93 states that carriers 'must offer preboarding to passengers with a disability who selfidentify at the gate as needing additional time or assistance to board, stow accessibility equipment, or be seated.' Passengers with severe nut allergies are passengers with disabilities for purposes of Part 382.5." But, according to the Journal and other sources, airlines have conflicting policies regarding preboarding for passengers with allergies, and even those policies which could help passengers with life-threatening allergies might not always be followed because those in charge of boarding may not be familiar with them, or overlook them because of time pressures or for other reasons. The same types of problems occurred when I filed a formal legal petition to protect sensitive airline passengers from secondhand tobacco smoke long before there were reports that it caused lung cancer and heart attacks among even healthy nonsmokers, says Banzhaf. The result was a federal requirement for no-smoking sections aboard commercial airline flights. Also, during the time when federal regulations required that nonsmokers who arrived on time were entitled to be seated in the no-smoking section, even if it mean shrinking the smoking section to accommodate them, this legal requirement was all too frequently violated. To protect sensitive passengers, my antismoking organization and I adopted a two-pronged approach. First, we printed up wallet-sized cards containing the actual text of the federal regulation, along with instructions to show it to flight attendants and others in charge of seating arrangements, and if necessary to ask that the card be brought to the cockpit. This guaranteed that there would be no misunderstanding or misinterpretation of the applicable law. Second, the card told airline employees that I as a lawyer would file formal complaints of any violations, and provided information for nonsmoking passengers whose rights were violated to send me the information so that I could file legal complaints on their behalf. This resulted in many hundreds-of-thousands of dollars worth of fines against many major carriers and, for the first time, forced airlines to take steps to insure compliance. The DOT Ruling Banzhaf suggests that nonprofit organizations concerned about passengers with allergies, and perhaps even large HMOs and other medical organizations, print a simple wallet-size card containing the formal text of the DOT ruling which can be shown by passengers with serious food allergies to those in charge of preboarding. A simpler and even less expensive alternative would be to produce a document - which could be downloaded and stored in a cellphone - which provided the text of the federal preboarding ruling articulating the right to which severely allergic passengers are entitled. Along with warnings about formal legal complaints to the DOT as well as suits in civil courts for life-endangering violations even in no injuries actually result (e.g. for intentional infliction of severe emotional distress if the severely allergic passenger is a young child).   Such a document could also provide links so that passengers whose preboarding rights are being violated could post the situation to appropriate social media sites; a tactic which can often provide a very prompt response by carriers which monitor such sites to head off various embarrassing problems. However, to prevent passengers increasingly desperate to board early in order to assure space overhead for their carry-on luggage and/or for other reasons, it might be useful to require that passengers do more than verbally claim (i.e., self identify) their legal entitlement for preboarding by presenting a doctor's letter attesting that they meet the DOT's stringent requirements. As the DOT has explained: "an allergy may or may not rise to the level of a disability, depending on severity. Part 382 Preamble, 73 FR 27459, 27660 ('remember that not all allergies rise to the level of a disability. The fact that someone may have a stuffy nose or sneeze when exposed to dog or cat dander does not necessarily mean that the individual has a disability.') In contrast, an allergy that 'produces shock or respiratory distress that could require emergency or significant medical treatment' would rise to the level of a disability." Indeed, D.O.T. considers severe allergies a disability under the act if they impact a passenger’s ability to breathe or “substantially impact another major life activity.” Banzhaf notes that, just like many passengers would like to be able to preboard, many if not most college students would like to be granted more time to finish writing their exams. However, colleges and universities do not simply allow students to self identify that they have learning disabilities which require them to have increased time to complete their exams. Instead, they require detailed individualized medical certification which meets stringent criteria for any student to be entitled to this valuable perk. Arguably, something more than mere self identification or certification of an allergy so serious that it "produces shock or respiratory distress" should be required, the law professor suggests. Banzhaf says he is considering filing another formal legal petition with the DOT to clarity and perhaps increase protections for passengers with serious food allergies, just as he was so successful in doing for passengers who were allergic or especially sensitive to tobacco smoke......»»

Category: blogSource: valuewalkJan 16th, 2023

Destroying American Democracy - An Inside Job

Destroying American Democracy - An Inside Job Authored by Pete Hoekstra via The Gatestone Institute, Over the last few years, there has been much written about the destruction of American democracy. Frequently the threat has been of alleged interference in U.S. elections by Russia, China or other state actors. Government agencies, the name of election integrity, were assigned to identify and disrupt these foreign intrusions. As more and more information is revealed about these agencies, it seems that America's Intelligence Community participated in these activities domestically, and in a way that poses a grave threat to both election integrity and American democracy. Just last week it was revealed that the FBI again withheld pertinent information from the American public, for past two months, until after the November 8, 2022 federal election. As with the Bureau's reported cover-up of evidence influence-peddling reportedly found on Hunter Biden's laptop, agents knew, since November 2, 2022, about at least some of the three sets of classified material that illegally found their way into the garage and library of President Joe Biden and into the Penn Biden Center think tank at the University of Pennsylvania -- to which anonymous members of the Chinese Communist Party have donated $54.6 million. Their existence only became known this week, after the newly elected Republican-majority House of Representatives announced that it would hold hearings on "how the [Justice] department handled investigations into classified materials found at former President Donald Trump's Florida home and those found at President Joe Biden's office in a Washington think tank bearing his name and his Delaware home..." In addition, the recent release of the "Twitter Files" has raised at least two major concerns regarding actions by the Intelligence Community. The first is that the wall of separation between the Intelligence Community and the U.S. media has not only sprung a leak, it has totally collapsed. The report that officials from the Office of the Director of National Intelligence (ODNI) met weekly with Twitter executives to coordinate information is totally inappropriate. Would officials from the ODNI review, affirm or label certain sets of information as false? When ODNI was created, no one intended its officials to have a role in these types of discussions. It also appears that intelligence officials in recent years have politically weaponized intelligence. The combination of a politically weaponized Intelligence Community, operating hand-in-hand with organizations that are the main gateways for information to millions of Americans, poses a serious threat to American democracy and the integrity of our elections. Let us just briefly look at the steep slope of lying, deceit and corruption that has seeped into the leadership of the U.S. Intelligence Community. First, there are not enough words to praise our Intelligence Community and the men and women who risk their lives to keep America safe. These are the rank-and-file professionals that form the core of the Intelligence Community. Most are dedicated to the mission of gathering the necessary information to protect our nation. Their leaders have a responsibility to serve these individuals. Too often, however, as the current array of whistleblowers indicates, those leaders have let these individuals down. Imagine their reaction in 2013 when, in response to a question from Senator Ron Wyden to then-Director of National Intelligence (DNI) James Clapper about whether the National Security Agency (NSA) collects "any type of data on millions, or hundreds of millions of Americans," Clapper answered, "No sir, not wittingly." Clapper, who had been given the question the previous day, was asked after the hearing if he wanted to amend the answer, and declined. It was shortly thereafter that a massive NSA program containing millions of pieces of Americans' data was revealed. Clapper was caught in a huge lie -- to U.S. Senator Wyden and the American people. On January 12, 2017, CNN reported that President-elect Donald Trump had been briefed by DNI Clapper, FBI Director James Comey, CIA Director John Brennan, and NSA Director Michael Rogers. The topic: "Russian operatives claim to have compromising personal and financial information about Donald Trump." It was intended to inform the President-elect that these allegations "are circulating among intelligence agencies, senior members of Congress, and other government officials in Washington." The briefing also touched on other major allegations they claimed were "circulating." Having this false information -- some of which the FBI actually altered -- in the public domain was evidently intended to damage Trump. The Russian "hoax" allegations would haunt and damage the Trump presidency for almost two years. Clapper himself stated: "I express my profound dismay at the leaks that have been appearing in the press ... they are extremely corrosive and damaging to our national security." Clapper also released a statement that neither he nor anyone else in the Intelligence Community were responsible for the leaks. How did this highly classified information, then, get into the public domain? A House Republican investigation provides the answer. Clapper denied leaking the dossier but admitted to discussing the dossier with CNN correspondent Jake Tapper and perhaps other journalists in early January 2017. Later in 2017, Clapper would go on to join CNN as a "national security" contributor and CNN would receive an award for its reporting at the White House Correspondents' dinner. Today we know that the "Russia hoax" was a lie. After a 22-month investigation, no evidence of collusion between any element of the Trump campaign and Russia was uncovered. The supposedly compromising evidence had never existed; the information in the "Steele dossier" was false -- and the FBI had known it was from the start. The entire fabrication had been an attempt to attack and politically weaken Trump. In October 2020, shortly before the elections 51 former intelligence professionals had even signed a joint letter stating that the Hunter Biden laptop had "has all the classic earmarks of a Russian information operation." They stated that their national security experience made them "deeply suspicious that the Russian government played a significant role in this case." They went on: "If we are right, this is Russia trying to influence how Americans vote in this election, and we strongly believe that Americans need to be aware of this." The New York Times raised questions about the authenticity of the materials found on the laptop. Bill Evanina, the National Counterintelligence and Security Center Director, had indicated in August that Russia was trying to denigrate the Biden campaign. All these manufactured "facts" were apparently intended to create circumstances where reasonable people would have to conclude that the Hunter Biden laptop was Russian disinformation. Signatories of the 2020 letter included Clapper, Brennan, Michael Hayden, Jeremy Bash and David Buckley. Clapper and Brennan are familiar names. They were involved in the January 2017 briefing to President Donald Trump on the fake Steele dossier. Jeremy Bash and David Buckley are worth mentioning because they continue to play significant roles in domestic and national security areas in the U.S. government. Buckley was the majority staff director on the House Select Committee investigating January 6th. Bash has been named to co-chair a government commission to review the war in Afghanistan. The fraudulent efforts by the U.S. government, Clapper, Brennan and the 49 others -- along with Hillary Clinton, her campaign committee, the Democratic National Committee and the suppression of the media and social media (here and here) -- to influence the public unfortunately met with some success. For almost two years, the authenticity of the material found on Hunter Biden's laptop was questioned. Today, its authenticity has been verified; the information is real and damning. As summarized by the New York Post: "Yes that letter from the Dirty 51 had all the classic earmarks of a disinformation operation, all right – one designed to ensure Joe Biden won the presidency. And it was essentially a CIA operation, considering 43 of the 51 signatories were former CIA." One final example of the Intelligence Community involving itself in domestic politics comes from the recent release of the "Twitter Files." According to tweet #20 of the third tranche released: "This post about the Hunter Biden laptop situation shows that Roth not only met weekly with the FBI and DHS, but with the Office of the Director of National Intelligence." Tweet #17 states: "executives were also clearly liaising with federal enforcement and intelligence agencies about moderation of election-related content." Finally, the FBI paid Twitter $3.5 million reportedly to "handle requests from the bureau." We now know what happened. Twitter suppressed discussion of the Hunter Biden laptop story and suppressed conservative messaging, while at the same time it appears the FBI, DHS and the ODNI had literally had set up shop at Twitter. The American people should be outraged. This level of collaboration between federal law enforcement and a private sector company on controlling speech is terrifying. Having our Intelligence Community, which is supposed to be focused on foreign intelligence collection, involved is even more terrifying. DNI James Clapper lying to the American people in 2013 about government surveillance of them, the promoting of the Russian hoax theory in 2017 by CIA Director Brennan, DNI Clapper, FBI Director Comey and others, the suppression of the Hunter Biden laptop story by 51 former intelligence professionals, and the close working arrangement between the FBI, DHS and the ODNI in 2020-2022 raises a staggering series of questions: Can our government, law enforcement, and the Intelligence Community still be trusted? Have those federal government agencies literally weaponized law enforcement and intelligence against political opponents in the U.S.? Has more than one solitary person -- former FBI attorney Kevin Clinemith, for altering an email -- been held accountable for these egregious abuses of power? Why wasn't there a more powerful response from the Intelligence Community and the law enforcement community about the disinformation from the 51 former intelligence professionals? Who authorized the cozy relationship between law enforcement, the intelligence community with Twitter? Who in these government agencies reviewed and approved of the output and decisions coming from these joint efforts? Were political appointees in the review loop? Who has the records, notes and decisions that emanated from these groups? It is clear that our law enforcement community needs to be investigated, but most importantly we need to investigate how our Intelligence Community has evolved from having literally a non-existent relationship with speech in America to being inside the room determining what speech is allowed. There also needs to be a significant investigation by an outside, non-government group to understand how far this massive government overreach into free speech and election manipulation went. Clearly the government has been influencing what we get to see and hear. It needs to stop -- now -- before our democracy is destroyed. Tyler Durden Sun, 01/15/2023 - 23:30.....»»

Category: blogSource: zerohedgeJan 16th, 2023

5 Reasons Why Gold Is Green

5 Reasons Why Gold Is Green Authored by Ronni Soeferle via, Introduction by Matthew Piepenburg In this refreshingly fact-focused report, Matterhorn Asset Management (MAM) advisor, Ronni Stoeferle, takes a deeper look at the false “eco war” on gold. In a world of ever-growing public narratives completely at odds with transparent reality (from “Putin’s” war to “Transitory Inflation”), it should come as no surprise that the current ESG and “Green Revolution Army” of the woke West has turned its political gun sights toward the one precious metal which serves as the greatest threat to a dying fiat currency system: Gold. With puffed chests and lofty claims, global environmental leadership has conveniently made a disingenuous but full-frontal assault on gold mining (and hence gold) as an environmental threat. How convenient… Fortunately, Ronni’s analysis of gold’s use/consumption data, CO2 characteristics and environmental comparisons to conventional fiat currencies provides a far more fact-based (rather than politically-charged) context to this otherwise bogus war on history’s most precious of metals. 5 Reasons Why Gold Is Green In the gold industry, too, ESG is now on everyone’s lips. Behind the letter abbreviation ESG lies the endeavor to motivate companies to actively pursue ecological, social and good governance targets. ESG ratings offer investors and NGOs the opportunity to track progress in this effort and identify the best companies in the industry. However, it is wrong to limit the concept of sustainability only to these ESG ratings. After all, the ratings only evaluate the mining companies, but not the precious metals themselves. Gold suffers particularly from this limited view of sustainability. For example, gold mining is usually reported in a negative context. Inhumane working conditions in some gold mines in Africa or the environmental threat posed by cyanide contamination are the focus of this reporting. The detection of such misconduct is undoubtedly justified and important. However, the fact that such news completely discourages environmentally conscious or socially committed investors from investing in the yellow metal is an exaggerated reaction. It may sound surprising at first glance: Environmentally conscious investors should focus on gold as an investment instrument. Gold is green because gold is used and not consumed CO2 emissions only occur in the relatively insignificant mining of new gold gold is versatile in its use many other raw materials perform significantly worse ecologically fiat money also has a poor environmental record. 1. Gold is used and not consumed In the public debate, truncated representations are currently very much in vogue. Electric cars are considered climate-friendly because, unlike cars with internal combustion engines, their operation does not cause any emissions. Any additional emissions and environmental impact caused by electricity production and the manufacture and scrapping of the car are not taken into account. In this context, however, only the overall view over the entire life cycle should be relevant for an ecological assessment. And in this view, gold is indeed the most sustainable metal in the world because of its elementary properties, the extraction process and its stable value. Gold has been mined for more than 7,000 years. During this period, more than 205,000 tons have been produced, which is equivalent to the size of about 3.5 Olympic swimming pools. More than half of this has been mined since the 1950s. Crucial to gold’s sustainability and environmental footprint is that virtually all of the gold ever mined is still in use. With every gold jewelry, every gold coin, every gold bar, there is some chance that some of it has been used for many centuries, perhaps even millennia. Unlike consumer goods such as food, commodities, but also real estate, gold is not consumed, but merely used. Therefore, new gold production is hardly significant in an overall view, as the stock-to-flow ratio demonstrates. The current value of around 58 means that the amount of gold already in existence is 58 times the amount of the current annual new production. In other words, the annual “inflation rate”, i.e. the growth of the global gold stock compared to the already mined and further used (!) amount, is low and relatively stable. It fluctuates between 1.2% and a maximum of 2.4%. As a precious metal, gold is characterized by the fact that it does not chemically react with air or its components such as oxygen, carbon dioxide and other gases. This protects gold from losing its luster. Gold therefore remains in its purest form forever. This makes it the perfect investment vehicle that can be passed down from generation to generation. The social and environmental costs of gold mining can consequently be spread over an almost infinitely long period of time, making them converge towards zero. The permanence of gold also means that gold never has to be disposed of as waste. No one will voluntarily throw gold away, but will want to recycle it for profit. 2. Significant CO2 emissions are incurred only during mining The current strong focus on curbing CO2 emissions to combat climate change should also lead to a stronger focus on gold among investors. This is because gold is a decidedly CO2-friendly metal and investment. Three different sources are distinguished in the attribution of CO2 emissions. Scope 1 emissions cover those climate-damaging emissions that are released within the company itself, Scope 2 includes those emissions caused by the company’s energy suppliers, and finally Scope 3covers those thatoccur in the upstream and downstream supply chain. For many products, the good part of the emissions arises in the upstream and downstream supply chains, i.e. Scope 3. However, the Scope 3 emissions of gold mining companies are almost negligible, as a gold bar is very rarely further processed. Furthermore, Scope 1 and Scope 2 CO2 emissions per ounce of gold produced are extremely low for large operations. The comparison with other raw materials makes this clear. The production of aluminum consumes almost 11 times as much CO2 per US dollar of production value, steel more than 5.5 times, coal almost three times and zinc more than two times. Copper is in the region of gold, lead slightly below, while iron ore is much more CO2 -friendly, with around two-thirds fewer emissions. However, gold recycling produces 90% fewer CO2 emissions than gold mining, and about 25% of annual gold demand is met by recycling alone. In addition, gold that has already been mined does not cause any additional emissions, as these are generated exclusively during the mining and refining of the gold. Gold is used and not consumed. Consequently, the possession of physical gold does not produce any emissions. Only the processing of gold into jewelry and the industrial use of gold emits a small amount of additional CO2. Over time, physical gold will therefore continue to reduce the emissions intensity of a portfolio. 3. Gold greens a portfolio Consequently, an increase in the share of gold in an investor’s portfolio significantly reduces the CO2 footprint and the emissions intensity of the overall portfolio. For a portfolio consisting of 70% equities and 30% bonds, a 10% gold allocation reduces emissions intensity by 7%. A 20% gold allocation reduces emissions by 17%, according to calculations by the World Gold Council in its readable study “Gold and climate change – Decarbonizing investment portfolios.” 4. Fiat money harms the climate and the environment Fiat currencies, on the other hand, have a major impact on the environment. There are approximately 1.5 trillion coins in circulation worldwide, with a total weight of an estimated 5.25 million tons, consisting mainly of nickel, copper and steel. Banknotes in circulation in 2018 were around 576 billion. Every year, around 150 billion new banknotes are put into circulation. This corresponds to a stock-to-flow ratio of not even 4. Or put another way, a banknote has a life expectancy of just 4 years. The environmental damage that such enormous quantities of cotton, water, ink, and polymers as well as of metal continually cause is enormous, especially when compared to the 205,000 tons of gold that have been mined to date. This raises the more than legitimate question of whether our current fiat money system can be classified as sustainable – and this in two ways: on the one hand, sustainable in the sense of ecological compatibility, and on the other hand, sustainable in the economic sense. This is because the negligible marginal costs of paper money production encourage an excessive expansion of the money supply, which causes both ecological and economic distortions. 5. Gold is versatile in its use Gold is also very sustainable due to other properties. Its specific gravity and malleability make gold the perfect currency. It can be used to transport a large amount of value in a confined space, or it can be hammered into paper-thin gold leaf that is less than a micron thick.. It was highly prized thousands of years ago and is still the first choice of central banks today. Unlike a paper currency, gold reserves do not need to be replenished to maintain purchasing power, because gold is largely immune to inflation. Conclusion A closer look reveals beyond doubt that, contrary to a multitude of reports and prejudices spread by the media, gold can already be classified as a very sustainable investment in the sense of the ESG guidelines. And the entire industry is making great efforts to eliminate the remaining blemishes. Beyond the importance of gold for investors and the industry, the undeniable benefits of gold should raise the question of whether the current monetary system can be made more sustainable through greater integration of gold should increasingly come into focus; not only for environmental but also for economic sustainability considerations. So anyone turning away from gold is in fact turning away from the world’s most sustainable metal in terms of its CO2 balance sheet, the amount of waste and the amount of resources used. Tyler Durden Sat, 01/14/2023 - 09:20.....»»

Category: smallbizSource: nytJan 14th, 2023

C-SPAN calls on House Speaker Kevin McCarthy to give their cameras greater access to the House floor

C-SPAN's request followed a proposal by Rep. Matt Gaetz to allow C-SPAN cameras on the House floor during regular proceedings. Rep. Matt Gaetz, R-Fla., left, talks with Rep. Angie Craig, D-Minn., and Rep. Alexandria Ocasio-Cortez, D-N.Y., in the House chamber as the House meets for a second day to elect a speaker and convene the 118th Congress in Washington, Wednesday, Jan. 4, 2023.AP Images After covering the House speaker drama, C-SPAN says it's time for their cameras to have greater access. The network requested that Kevin McCarthy allow C-SPAN to cover more House floor proceedings. The network normally uses government-controlled cameras in the chamber that are restricted to wide-angle shots. After providing rare footage of the chaotic House speaker vote last week, C-SPAN says it's time for their cameras to have greater access to the House chamber.The cable and satellite television network's co-CEO Susan Swain, in a letter Tuesday, asked House Speaker Kevin McCarthy to allow C-SPAN to cover House floor proceedings on behalf of their network and all Congressionally-accredited news organizations.—CSPAN (@cspan) January 10, 2023 C-SPAN, a not-for-profit public affairs network, normally uses government-controlled cameras in the chambers that are restricted to wide-angle shots. But the network was allowed to cover last week's House speaker drama with it's own cameras from different angles — and they gave viewers a fascinating, behind-the-scenes show."This is the best season of cspan…ever," tweeted comedian Jon Stewart on January 4.The C-SPAN request came after Rep. Matt Gaetz — a breakout star of last week's House speaker C-SPAN show — introduced an amendment to House rules to allow C-SPAN cameras on the floor during regular proceedings.A spokesperson for McCarthy did not immediately respond to a request for comment.In her letter, Swain noted that there has been "little change in the strict rules" for video coverage of floor proceedings. The public, press, and House member's reaction to C-SPAN's coverage of the the House speaker votes last week "along with the 'transparency' themes in your new rules package — have encouraged us to resubmit a request we have made to your predecessors without success," she wrote.She asked to install a few additional cameras in the House chamber to create a "second journalistic product," in addition to the House Recording System. If ongoing coverage is not acceptable, she requested McCarthy permit C-SPAN and other independent journalists to cover key legislative sessions.Video produced by House Recording Studio government employees, she wrote, "lacks the transparency that C-SPAN, as a journalistic institution is able to provide."—CSPAN (@cspan) January 9, 2023 Read the original article on Business Insider.....»»

Category: worldSource: nytJan 10th, 2023