Month: April 2017

Ever since Mike Cernovich dropped the bombshell report over the weekend outing Obama’s National Security Advisor, Susan Rice, as the person behind the unmasking of the identity of various members of Trump’s team who were ‘incidentally’ surveilled during the 2016 campaign (see “Confirmed: Susan Rice “Unmasked” Trump Team“), a report which was subsequently confirmed by Eli Lake of Bloomberg earlier this morning, everyone has been wondering who within the Trump White House or the intelligence community supplied him with such a massive scoop. 

But, as it turns out, Cernovich didn’t need a ‘deep throat’ within the NSA or CIA for his blockbuster scoop, all he needed was some well-placed sources inside of a couple of America’s corrupt mainstream media outlets.  As Cernovich explains below, his sources for the Susan Rice story were actually folks working at Bloomberg and the New York Times who revealed that both Eli Lake (Bloomberg) and Maggie Haberman (NYT) were sitting on the Susan Rice story in order to protect the Obama administration.

“Maggie Haberman had it.  She will not run any articles that are critical of the Obama administration.”

 

“Eli Lake had it.  He didn’t want to run it and Bloomberg didn’t want to run it because it vindicates Trump’s claim that he had been spied upon.  And Eli Lake is a ‘never Trumper.’  Bloomberg was a ‘never Trump’ publication.”

 

“I’m showing you the politics of ‘real journalism’.  ‘Real journalism’ is that Bloomberg had it and the New York Times had it but they wouldn’t run it because  they don’t want to run any stories that would make Obama look bad or that will vindicate Trump.  They only want to run stories that make Trump look bad so that’s why they sat on it.”

 

“So where did I get the story?  I didn’t get it from the intelligence community.  Everybody’s trying to figure out where I got it from.  I got it from somebody who works in one of those media companies.  I have spies in every media organization.  I got people in news rooms.  I got it from a source within the news room who said ‘Cernovich, they’re sitting on this story, they’re not going to run it, so you can run it’.”

 

“If you’re at Bloomberg, I have people in there.  If you’re at the New York Times, I have people in there.  LA Times, Washington Post, you name it, I have my people in there.  I got IT people in every major news room in this country.  The IT people see every email so that’s how I knew it.”

And while this could certainly be interpreted as a clever ploy to protect his real sources, Cernovich’s video comments seem to be validated by both his tweet from yesterday afternoon…

Obama may be the first POTUS brought down by a scandal after he left office. Every major outlet had this scoop, none would run it. https://t.co/LvPEGqJxtk

— Mike Cernovich ???????? (@Cernovich) April 2, 2017

…and the fact that Eli Lake of Bloomberg was able to conveniently confirm Cernovich’s story with his own article this morning. 

All of which just begs the question of what other stories the mainstream media is sitting on in an effort to protect their chosen candidates.

via http://ift.tt/2nR5xdG Tyler Durden

Authored by Gary Galles via The Mises Institute,

via http://ift.tt/2o3xYra Tyler Durden

With Trump’s approval rating recently sliding to record lows, it may be impacting various affiliated assets, such as a 2007 Ferrari F430 F1 Coupe (bright red, of course) which was previously owned by Trump, and which left the sale block before meeting reserve at auction on Saturday in Florida. According to Boomberg, bidding on the car stopped at $240,000, $10,000 below its reserve price. Hours later, the auction house issued a statement saying “we can confirm it exchanged hands just minutes after it left the podium” for in a private sale for a final price of $270,000, just barely making the cut.

The 2007 Ferrari was purchased new by Trump a decade ago. He didn’t drive the Ferrari much. Trump sold the supercar in 2011 with fewer than 2,400 miles on it.

The company did not say who purchased the vehicle and offered no further details about the off-the-record sale; we await the usual anonymous WaPo sources to report that it was an agent of the Kremlin who ended up buying the car above the gavel price to prevent Trump’s assets from looking deflated.

Despite missing the reserve in the regular auction, this was still the most ever paid for an F430 Coupe with semi-automatic transition at auction according to Hagerty Insurance. It had been expected to take as much as $350,000.

Bloomberg notes that prices can vary widely on this exotic V8, 490-horsepower stallion. RM Sotheby’s sold a 2008 Ferrari F430 GTC for €459,200 ($490,310) in January in Paris; a 2008 Ferrari F430 Scuderia sold for $182,600 at a Motostalgia sale in Amelia Island, Fla. And Sotheby’s sold a yellow 2007 F430 Spider for $357,500 in 2016. Other F430s in various conditions can found online, for as much as $234,500 and as little as $121,000. 

Pristine, low-mileage versions—especially those with manual transmission or special craftsmanship—hold value better than lesser examples. Trump’s included Daytona-style seats and Scuderia crests on the fenders; it had yellow dials, a radio with a CD changer, and a carbon dash insert.

This 2007 Ferrari F430 F1 Coupe was formerly owned by Donald Trump

Since the car belonged to Trump, speculation immediately emerged as to why the price disappointed as much as it did.

The low price could have been affected by the fact that the car belonged to a “polarizing” president who used it himself, said Jonathan Klinger, a spokesman for Hagerty.

 

Trump purchased it new in 2007 and owned it for four years, enough to add on 2,400 miles. (Total mileage is near 6,000.) It’s certainly the only supercar to have been owned by a sitting president. Maybe it would have been worth more if Trump still owned it. (The car was offered to the auction house by its second and current owner.)

 

“The appeal is slightly lower than if [bidders] were buying the car directly from Trump,” Klinger said.

Perhaps Trump just got ahead of himself: according to Bloomberg, most sales of presidential memorabilia come after a former chief executive’s death. Last year, a pair of cowboy boots owned by Ronald Reagan carried a high estimate of $20,000 but sold for $199,500; a concrete shard of the Berlin wall signed by Reagan sold for $277,500. It had been expected to take $20,000.

Saturday’s disappointing auction appears to have been on outlier as previously Trump-owned cars have fared better at recent sales.

Trump’s Cadillac limousine took $68,261 at a Bonhams sale last month in England. The total was four to seven times the average value of an American limo from the same era, according to Hagerty data. His Lamborghini Diablo took $460,000 in September last year—on EBay. That was 75 percent higher than today’s current average price for Diablos.

Trump aside, the auction results suggest that the F430 is not necessarily a superior investment, something the vintage car market has shown for some time. Average values at auction for this model have fallen 15 percent over the last five years, according to Hagerty, hovering near $120,000 to $130,000 for a car with an F1 (paddle-shifter) gearbox. The original MSRP ranged from $185,000 to $215,000.

The biggest depreciating asset: the gearbox, which according to Klinger is the key to holding a car’s value, specifically whether a car has a true manual transmission vs. the six-speed paddle-shifter in Trump’s Ferrari.

“I would expect the cars with the F1 gearbox, like this one, to continue to depreciate for the near future,” Klinger said.

 

“These were some of the last Ferraris available with manual transmission, making them worth considerably more than the F1 cars,” Klinger continued. “A manual car is worth somewhere from 50 to 75 percent more than the F1 gearbox cars.”

The Ferrari’s new owner will get the car with just over 6,000 miles on it, and the purchase comes with a copy of the original title boasting Trump’s recognizable “bold signature,” Auctions America said.

And with that piece of trivia out of the way, here are some more gratuitous photos of a red ferrari.

Trump bought the car new in 2007 and registered it to Trump Tower

The former Trump Ferrari uses F1-style paddle-shifting on a six-speed gearbox

The car has a 4.3-liter, 490-horsepower V8 engine. Top speed is 196 miles per hour

The car has Daytona-style sport seats

In 2009, Ferrari discontinued the F430, which it had launched at the Paris Motor Show in 2004

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Authored by Kevin Muir of The MacroTourist

Way back in the 4th quarter of 2015, GMO’s Jeremy Grantham wrote a piece titled “Part II: 2015 and 2016, U.S. Equity Bubble Update, and Yet More on Oil.”

It is easy to forget, but at that point, the S&P was trading around 2,000 and everyone was bearish. QE had ended, the Fed was fumbling with their first hike and “fully valued” were the buzz words used to describe US equities.

Yet Jeremy didn’t write the all-too-easy piece about how stocks were about to crash. Instead, he acknowledged that equities were expensive, but not yet in bubble territory.

“On the evaluation front, the market is not quite expensive enough to deserve the bubble title. We at GMO have defined a bubble as a 2-standard deviation event (2-sigma). We believe that all great investment bubbles reached that level and market events that fell short of 2-sigma, did not feel like the real thing.”

 

“…I must admit to feeling nervous for this year’s equity outlook in the U.S. But I am not entirely convinced. Sure, we can have a regular bear market. That is always the case. But the BIG ONE? I doubt it.”

So while most everyone else was predicting a U.S. stock market bear market, Grantham postulated the most likely course for equities was to become even more expensive.

“The most important missing ingredient is a fully-fledged blow-off. This should come complete with crazy speculative anecdotes for your grandchildren, massive enthusiasm from individual investors, an overwrought, over capacity economy, and, at minimum, a 2-sigma S&P 500 at 2300. Lacking all of this, I still believe it is ‘likely’ that we will reach Election Day more or less intact.”

With the benefit of hindsight, this call doesn’t seem that outrageous, but think back to the end of 2015. Few were predicting new highs. It took guts for Grantham to write that piece. It was a terrific call.

Therefore I was extremely interested to hear what Grantham thinks now that we have hit his 2,300 target. Was this 2-sigma overvaluation enough for him to write some pink tickets?

But in a recent interview with the WSJ, Jeremy refused to join the parade of crash forecasters.

“Is the U.S. stock market in a bubble, or is it different this time?”

 

“It doesn’t have the characteristics of a bubble. A simple way of defining a bubble is that it has to have nearly perfect fundamentals which have to be irrationally extrapolated with considerable euphoria. Remember the style from 2000, Japan in ‘89, or the US housing market (house prices will never decline), or 1929 in the old days was a classic. We have none of that euphoria. We also have very imperfect fundamentals.”

 

“It’s only the other day that people were lining up to commit 10, 20, 30 year money for a guaranteed no real return. This is not a real prescription of mad desire to invest in the stock market.”

 

“Getting back to your question about whether this time is different. Value managers always say this time is never different. But it is fair to say that this time, it is decently different.”

I can’t say I disagree with my favourite veteran value manager. Asset markets have been squeezed higher through Central Bank financial repression. In the process, all assets have become expensive. But that is a much different phenomenon than the previous bubbles where the public’s imagination ran amok with thoughts of sugar plum fairies and rainbows. The only ones experiencing that sort of disillusion today are the Central Bankers who believe they will be able to control this mad science experiment.

A little more than a year and a half ago, Jeremy Grantham predicted the over valuation of U.S. equities would only become more acute. Today he seems to be sticking to that theme. Don’t dismiss his opinion just because he has committed the cardinal sin of saying “this time is different.” At least he added “decently…”

via http://ift.tt/2nQQ39F Tyler Durden

Two weeks ago, Reuters reported that due to “unexplained” reasons, the Venezuela central bank had stopped publishing its M2, or money supply, data.  The M2 money supply was up by nearly 180% in mid-February from a year earlier, according to the central bank before it halted the release of the weekly data without explanation in February.

 “If they are not publishing, you know it must be skyrocketing,” Aurelio Concheso, director of the Caracas-based business consultancy Aspen Consulting, stated the obvious. The central bank and ministry of communications did not respond to a request for comment, Reuters adds.

Fast forward to today when following the international outcry over last Wednesday’s failed coup-attempt by Maduro, in which the Supreme Court first withdrew the power of Venezuela’s opposition-controlled Congress, and then promptly reversed itself following loud international outcry and after it appeared that Maduro’s precarious grip on Venezuela society was about to be lost, when Venezuela’s M2 has once again mysteriously reappeared. According to the latest data, the money supply in the crisis-stricken country has surged over 200% in a year, up from 180% as of February, and the fastest rise since records began in 1940, putting it on track for the world’s highest inflation.

According to Reuters which first spotted the return of the data, soon after a month-long hiatus from publication, the central bank said late on Friday the total amount of local currency in circulation, M2, as of March 24 was 13.3 trillion bolivars, up 202.9% from a year earlier. By comparison, in the US, M2 rose by 6.4% in the same period.

But while M2 may have returned, official inflation data is still missing, which is probably for the best: Venezuela is in a major economic crisis, with millions struggling with food shortages and hyperinflation inflation in triple digits, if not higher.  Venezuela’s opposition-led National Assembly, which correctly accuses the leftist government of destroying the OPEC country’s economy, says inflation reached 741 percent in the year to February. It’s likely far higher.

The exponential rise in M2, the sum of cash, together with checking, savings and other deposits, means an exponential rise in the amount of currency circulating. Coupled with a decline in the output of goods and services, that has accelerated inflation.

Curiously, never before has Venezuela sunk so low, despite its economy being largely uniform over the years. As Reuters notes, the central bank website shows five separate spreadsheets with money supply data going back to 1940. Back then, as now, Venezuela’s primary export was oil.

One thing did change recently, however, roughly around the time the M2 curve started going exponential: that paragon of socialist virtue, Nicolas Maduro took over. The rest is history.

Maduro says right-wing businessmen are hoarding goods to sabotage his administration, and has accused the US of coordinating with other global leaders to remove him from power (that actually may not be too far off, if only the CIA wasn’t more focused on destabilizing the domestic US situation in recent months).

Meanwhile, as M2 goes exponential, we have a feeling that the following chart of the Bolivar on the Venezuela black market – which reflects its true lack of value – is about to take its next step function higher… or rather lower as what little value the local currency may have had disintegrates in the coming months.

We can only imagine the awe shared by Western central bankers who watch in dumbfounded amazement as this small country has achieved precisely the final outcome all “developed” currencies will one day soon experience.

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Authored by Matt Taibbi Of Rolling Stone

Putin Derangement Syndrome Arrives

So Michael Flynn, who was Donald Trump's national security adviser before he got busted talking out of school to Russia's ambassador, has reportedly offered to testify in exchange for immunity.

For seemingly the 100th time, social media is exploding. This is it! The big reveal!

Perhaps it will come off just the way people are expecting. Perhaps Flynn will get a deal, walk into the House or the Senate surrounded by a phalanx of lawyers, and unspool the whole sordid conspiracy.

He will explain that Donald Trump, compromised by ancient deals with Russian mobsters, and perhaps even blackmailed by an unspeakable KGB sex tape, made a secret deal. He'll say Trump agreed to downplay the obvious benefits of an armed proxy war in Ukraine with nuclear-armed Russia in exchange for Vladimir Putin's help in stealing the emails of Debbie Wasserman-Schultz and John Podesta.

I personally would be surprised if this turned out to be the narrative, mainly because we haven't seen any real evidence of it. But episodes like the Flynn story have even the most careful reporters paralyzed. What if, tomorrow, it all turns out to be true?

What if reality does turn out to be a massive connect-the-dots image of St. Basil's Cathedral sitting atop the White House? (This was suddenly legitimate British conspiracist Louise Mensch's construction in The New York Times last week.) What if all the Glenn Beck-style far-out charts with the circles and arrows somehow all make sense?

This is one of the tricks that keeps every good conspiracy theory going. Nobody wants to be the one claiming the emperor has no clothes the day His Highness walks out naked. And this Russia thing has spun out of control into just such an exercise of conspiratorial mass hysteria.

Even I think there should be a legitimate independent investigation – one that, given Trump's history, might uncover all sorts of things. But almost irrespective of what ends up being uncovered on the Trump side, the public prosecution of this affair has taken on a malevolent life of its own.

One way we recognize a mass hysteria movement is that everyone who doesn't believe is accused of being in on the plot. This has been going on virtually unrestrained in both political and media circles in recent weeks.

The aforementioned Mensch, a noted loon who thinks Putin murdered Andrew Breitbart but has somehow been put front and center by The Times and HBO's Real Time, has denounced an extraordinary list of Kremlin plants.

She's tabbed everyone from Jeff Sessions ("a Russian partisan") to Rudy Giuliani and former Assistant FBI Director James Kallstrom ("agents of influence") to Glenn Greenwald ("Russian shill") to ProPublica and Democracy Now! (also "Russian shills"), to the 15-year-old girl with whom Anthony Weiner sexted (really, she says, a Russian hacker group called "Crackas With Attitudes") to an unnamed number of FBI agents in the New York field office ("moles"). And that's just for starters.

Others are doing the same. Eric Boehlert of Media Matters, upon seeing the strange behavior of Republican Intel Committee chair Devin Nunes, asked "what kind of dossier" the Kremlin has on Nunes.

Dem-friendly pollster Matt McDermott wondered why reporters Michael Tracey and Zaid Jilani aren't on board with the conspiracy stories (they might be "unwitting" agents!) and noted, without irony, that Russian bots mysteriously appear every time he tweets negatively about them.

Think about that last one. Does McDermott think Tracey and Jilani call their handlers at the sight of a scary Matt McDermott tweet and have the FSB send waves of Russian bots at him on command? Or does he think it's an automated process? What goes through the heads of such people?

I've written a few articles on the Russia subject that have been very tame, basically arguing that it might be a good idea to wait for evidence of collusion before those of us in the media jump in the story with both feet. But even I've gotten the treatment.

I've been "outed" as a possible paid Putin plant by the infamous "PropOrNot" group, which is supposedly dedicated to rooting out Russian "agents of influence." You might remember PropOrNot as the illustrious research team the Washington Post once relied on for a report that accused 200 alternative websites of being "routine peddlers of Russian propaganda during the election season."

Politicians are getting into the act, too. It was one thing when Rand Paul balked at OKing the expansion of NATO to Montenegro, and John McCain didn't hesitate to say that "the senator from Kentucky is now working for Vladimir Putin."

Even Bernie Sanders has himself been accused of being a Putin plant by Mensch. But even he's gotten on board of late, asking, "What do the Russians have on Mr. Trump?"

So even people who themselves have been accused of being Russian plants are now accusing people of being Russian plants. As the Russians would say, it's enough to make your bashka hurt.

Sanders should know better. Last week, during hearings in the Senate, multiple witnesses essentially pegged his electoral following as unwitting fellow travelers for Putin.

Former NSA chief Keith Alexander spoke openly of how Russia used the Sanders campaign to "drive a wedge within the Democratic Party," while Dr. Thomas Rid of Kings College in London spoke of Russia's use of "unwitting agents" and "overeager journalists" to drive narratives that destabilized American politics.

This testimony was brought out by Virginia Democrat Mark Warner. Warner has been in full-blown "precious bodily fluids" mode throughout this scandal. During an interview with The Times on the Russia subject a month back, there was a thud outside the window. "That may just be the FSB," he said. The paper was unsure if he was kidding.

Warner furthermore told The Times that in order to get prepared for his role as an exposer of 21st-century Russian perfidy, he was "losing himself in a book about the Romanovs," and had been quizzing staffers about "Tolstoy and Nabokov."

This is how nuts things are now: a senator brushes up on Nabokov and Tolstoy (Tolstoy!) to get pumped to expose Vladimir Putin.

Even the bizarre admission by FBI director (and sudden darling of the same Democrats who hated him months ago) James Comey that he didn't know anything about Russia's biggest company didn't seem to trouble Americans very much. Here's the key exchange, from a House hearing in which Jackie Speier quizzed Comey:

SPEIER: Now, do we know who Gazprom-Media is? Do you know anything about Gazprom, director?
COMEY: I don't.
SPEIER: Well, it's a – it's an oil company.

(Incidentally, Gazprom – primarily a natural-gas giant – is not really an oil company. So both Comey and Speier got it wrong.)

As Leonid Bershidsky of Bloomberg noted, this exchange was terrifying to Russians. The leader of an investigation into Russian espionage not knowing what Gazprom is would be like an FSB chief not having heard of Exxon-Mobil. It's bizarre, to say the least.

Testimony of the sort that came from Warner's committee last week is being buttressed by news stories in liberal outlets like Salon insisting that "Bernie Bros" were influenced by those same ubiquitous McDermott-chasing Russian "bots."

These stories insist that, among other things, these evil bots pushed on the unwitting "bros" juicy "fake news" stories about Hillary being "involved with various murders and money laundering schemes."

Some 13.2 million people voted for Sanders during the primary season last year. What percentage does any rational person really believe voted that way because of "fake news"?

I would guess the number is infinitesimal at best. The Sanders campaign was driven by a lot of factors, but mainly by long-developing discontent within the Democratic Party and enthusiasm for Sanders himself.

To describe Sanders followers as unwitting dupes who departed the true DNC faith because of evil Russian propaganda is both insulting and ridiculous. It's also a testimony to the remarkable capacity for self-deception within the leadership of the Democratic Party.

If the party's leaders really believe that Russian intervention is anywhere in the top 100 list of reasons why some 155 million eligible voters (out of 231 million) chose not to pull a lever for Hillary Clinton last year, they're farther along down the Purity of Essence nut-hole than Mark Warner.

Moreover, even those who detest Trump with every fiber of their being must see the dangerous endgame implicit in this entire line of thinking. If the Democrats succeed in spreading the idea that straying from the DNC-approved candidate – in either the past or the future – is/was an act of "unwitting" cooperation with the evil Putin regime, then the entire idea of legitimate dissent is going to be in trouble.

Imagine it's four years from now (if indeed that's when we have our next election). A Democratic candidate stands before the stump, and announces that a consortium of intelligence experts has concluded that Putin is backing the hippie/anti-war/anti-corporate opposition candidate.

Or, even better: that same candidate reminds us "what happened last time" when people decided to vote their consciences during primary season. It will be argued, in seriousness, that true Americans will owe their votes to the non-Putin candidate. It would be a shock if some version of this didn't become an effective political trope going forward.

But if you're not worried about accusing non-believers of being spies, or pegging legitimate dissent as treason, there's a third problem that should scare everyone.

Last week saw Donna Brazile and Dick Cheney both declare Russia's apparent hack of DNC emails an "act of war." This coupling seemed at first like political end times: as Bill Murray would say, "dogs and cats, living together."

But there's been remarkable unanimity among would-be enemies in the Republican and Democrat camps on this question. Suddenly everyone from Speier to McCain to Kamala Harris to Ben Cardin have decried Russia's alleged behavior during the election as real or metaphorical acts of war: a "political Pearl Harbor," as Cardin put it.

That no one seems to be concerned about igniting a hot war with nuclear-powered Russia at a time when both countries have troops within "hand-grenade range" of each in Syria other is bizarre, to say the least. People are in such a fever to drag Trump to impeachment that these other considerations seem not to matter. This is what happens when people lose their heads.

There are a lot of people who will say that these issues are of secondary importance to the more important question of whether or not we have a compromised Russian agent in the White House.

But when it comes to Trump-Putin collusion, we're still waiting for the confirmation. As Democratic congresswoman Maxine Waters put it, the proof is increasingly understood to be the thing we find later, as in, "If we do the investigations, we will find the connections."

But on the mass hysteria front, we already have evidence enough to fill a dozen books. And if it doesn't freak you out, it probably should.

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As U.S. equity markets continue their march back toward all-time highs, courtesy of the latest BTFD binge trade, at least one ‘small’ segment of the U.S. economy does not seem to be participating in the rally as 9 brick-and-mortar retailers have already filed for bankruptcy protection in 1Q 2017 alone.  That volume of filings matches the total number of retail bankruptcies for all of 2016 and puts the industry on pace to exceed even the ‘great recession’ highs. Per CNBC:

Nine retailers have filed in just the first three months of 2017, according to data provided exclusively to CNBC from AlixPartners consulting firm. That equals the number for all of 2016. It also puts the industry on pace for the highest number of such filings since 2009, when 18 retailers resorted to that action.

 

The rising number of retail bankruptcies comes as consumers are making more purchases online, and shifting their spending toward travel and other experiences. Meanwhile, the supply of physical stores continues to outweigh shopper demand, putting pressure on the industry’s profits.

 

“It’s just kind of this perfect storm where things are coming together, and it’s going to continue for awhile,” Deb Rieger-Paganis, a managing director in the turnaround and restructuring practice at AlixPartners, told CNBC.

Many of the early retail victims include companies that were snapped up by Private Equity interests during the last down cycle and aggressively levered.  In addition to the following nine retailers that have already liquidated or are working to reorganize, Payless Shoes and Bebe are also expected to file at some point in the not so distant future.

• Gordmans Stores
• Gander Mountain
• General Wireless Operations (formerly RadioShack)
• HHGregg
• BCBG Max Azria
• Michigan Sporting Goods Distributors
• Eastern Outfitters
• Wet Seal
• Limited Stores

Of course, as Deb Rieger-Paganis, a managing director in the turnaround and restructuring practice at AlixPartners, points out, retail bankruptcies and/or store closures, especially from anchor tenants, can push the whole retail space into a downward spiral as “people don’t like to shop where there’s a lot of vacant space.”  So while larger retailers like Macy’s, J.C. Penney, Sears and Kmart have avoided chapter 11 so far in this cycle, they’re all in the process of closing hundreds of stores and those vacancies are likely to have ripple effects through the industry.

Meanwhile, as we pointed out last month (see “America’s Desperate Mall Owners Turn To Grocers, Doctors & High Schools To Fill Empty Space“), America’s mall owners are having such a hard time filling empty retail space that they’re turning to high schools, doctors offices and grocery stores.

Once a shining beacon of American capitalism, malls around the U.S. are failing at an alarming rate due to a combination of shifting consumption patterns, years of underinvestment by mall owners and a spate of retailer bankruptcies over the past 12 months that have left large swaths of once prime real estate empty (see “Number Of Distressed US Retailers Highest Since The Great Recession“). 

Now, as the vacant square footage grows larger, mall owners are being increasingly forced to turn to non-conventional tenants to fill empty space.  Per the Wall Street Journal, the latest target of mall owners is yet another struggling industry, grocers, with everyone from Whole Foods to Kroger looking to snap up square footage at discount prices.

But we’re sure it will all work out just fine and wall street will go on buying those mall reits with reckless abandon…you know, because dividend yields.

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Authored by John Banzhaf via ValueWalk.com,

In the wake of an announcement by U.S. Attorney General Jeff Sessions that he would cut off funding if so-called sanctuary cities did not begin cooperating with the federal government regarding illegal aliens, it has been reported that the New York City Police Department [NYPD] alerts Immigration and Customs Enforcement [ICE] agents if immigrants facing deportation are due to appear in Criminal Court, thereby making it easier for them to be detained by the federal government.

Although many cities loudly proclaimed that they would not yield to these threats and yield even one inch on their sanctuary status, some observers, including public interest law professor John Banzhaf, predicted that Sessions’ threat, even if arguably unconstitutional, would successfully pressure at least some jurisdictions.

He noted that Florida’s largest county, Miami-Dade, long known for welcoming immigrants, has already ordered jails there to “fully cooperate” with Trump’s order regarding sanctuary cities, and others appear to be considering it.

Other states are also moving to pressure localities to begin cooperating with federal immigration enforcement.  These include, Iowa, Kansas, Kentucky, North Carolina, Pennsylvania, Texas, Virginia, and Wisconsin.

Banzhaf has publicly suggested that Trump’s order may unconstitutionally violate both states’ rights and Congress’ rights, and the sanctuary behavior about which he complained may not even violate the statute he cited.

Nevertheless, in part because cities may have difficulty obtaining a prompt judicial ruling on the constitutionality of the threat or even of a proposed cutoff, and because of the huge risks and legal costs of challenging governmental action, many more – despite their defiant claims – are likely to cave in.

Indeed, if New York City begins cooperating even in a small way with ICE, this might help persuade many other jurisdictions – which lack NYC’s resources to fight the federal government in court – to likewise bend, suggests Banzhaf.

The entire program, beginning with President Trump’s executive order stating that funds should be cut off to so-called sanctuary cities – if it is interpreted as many suggest, and if a court is ever able to rule on the issue – may be an unconstitutional violation of both states’ rights and Congress’ rights.

If, as some fear, the order would threaten funding for cities which claim sanctuary status because they tell police not to question people about their immigration status, and don’t honor detainer requests to hold people in jail for immigration purposes, it may be unconstitutional on several grounds.

First, it arguably violates the long-standing principle that the federal government cannot, consistent with the Tenth Amendment, “commandeer” local officials to enforce federal law. This principle dates back at least to a 1842 Supreme Court decision striking down a requirement that states assist federal officials to capture runaway slaves.

It was also reinvigorated in a 2012 ruling that states could not be required to expand Medicaid programs under threat of a loss of federal funds – the same coercive method threatened by Sessions – except there the threat was one mandated by Congress and signed into law, not a mere presidential order.

Second, the Court has said that conditions may not be imposed on federal grants unless they are “unambiguously” stated in the statute’s text “so that the States can knowingly decide whether or not to accept those funds.”  Few if any existing grants have explicit conditions related to providing sanctuary.

Moreover, the conditions, if any, seemingly have to be passed by Congress.

Allowing a president to cut off funds based solely upon his own whim, without any congressional approval, could create a very dangerous precedent undercutting Congress’ authority (under separation of powers) as well as federalism (upholding state’s rights).

For example, it could permit a Democratic president to force states to do what a Republican dominated House and Senate might oppose.

Moreover, since the order provides for funds to be cut off only to “jurisdictions that willfully refuse to comply with 8 U.S.C. 1373,” it’s not clear if it would even apply to most “sanctuary cities.”

That statute says simply that “a Federal, State, or local government entity or official may not prohibit, or in any way restrict, any government entity or official from sending to, or receiving from the Immigration and Naturalization Service, information regarding the citizenship or immigration status, lawful or unlawful, of any individual.”

But since sanctuary cities usually simply have police not question people about their status, officials would have no citizenship and/or immigrant status information available to share which would be restricted.  Even more clearly, 1373 has nothing to do with refusing to honor detainers.

Many experts commenting on the possible unconstitutionality or uncertainty about the applicability of the order fail to also note that it may be difficult if not impossible for sanctuary cities to get a court to rule on these issues, especially in a timely manner, for a number of reasons.

The first is the administrative law principle known as ripeness, which says that courts should not address legal issues until they are ripe – sufficiently developed, with the facts clear enough, for a court to rule knowledgeably and authoritatively.  This applies most strictly when constitutional issues are raised.

Here, since the very meaning of the order, its applicability to different so-called sanctuary activities, and how federal officials will interpret and seek to enforce it are all unclear, courts may well decide that the issues – especially those related to constitutionality – are just not yet ripe enough for adjudication.

A second administrative law doctrine, exhaustion of administrative remedies, provides that courts should not decide legal issues if plaintiffs have failed to exhaust whatever administrative remedies they may have before and within the agency itself.

For example, if the agency provides for hearings, these hearing should occur, and the agency at the highest level should then render a final decision, before a court decides important legal issues.

Here, each threatened city almost certainly will be entitled to a hearing before funds are finally terminated, so cities may have to participate in such a hearing before they can get relief from a court.

However, despite their claims now to the contrary, many cities might be unwilling to have this Sword of Damocles hanging over their heads while they go though a lengthy expensive hearing process, often with their very survival hanging in the balance, simply to protect people illegally in the country.

That means, suggests Banzhaf, that Sessions’ threat is likely to be effective even if it is unconstitutional.   Entities faced with possible financial devastation from funds being cut off are rarely willing to take a risk, and often find that it is much easier to simply comply than to take a chance and fight.

Indeed, this effect is so well known that it goes by the name “regulation by raised eyebrow” – i.e., an agency need do nothing more than suggest possible adverse consequences, and those subject to a possible sanction all too often comply immediately.

Certainly this has proven to be true with regard to colleges which have spent hundreds of millions of dollars to set up programs to deal with rape, based solely upon mere suggestions by the Department of Education [DOE], with no more than an implied threat to their funding.

This DOE threat falls far short of the explicit threat of loss of funding coming directly from the president in the sanctuary cities executive order.  In short, even if the executive order is in fact unconstitutional, no court may ever be able to make that ruling, and many if not most cities may well comply anyhow.

via http://ift.tt/2oCvvlf Tyler Durden

While not surprising – her departure had been floated previously – moments ago ReCode confirmed that Yahoo CEO Marissa Mayer “will not be continuing with the new company that was announced today prematurely in a tweet by AOL CEO Tim Armstrong today.”

Perhaps what is more surprising is the name of said pro forma company, which according to Kara Swisher will be called “Oath”, and will be headed by Armstrong.

Billion+ Consumers, 20+ Brands, Unstoppable Team. #TakeTheOath. Summer 2017. http://pic.twitter.com/tM3Ac1Wi36

— Tim Armstrong (@timarmstrongaol) April 3, 2017

As Recode adds, it will also be interesting to see if she gets the full pay-out she is owed, after the recent hacking disaster and the general downturn in Yahoo’s business during her tenure.

Some other details on the transition:

Armstrong is now close to making choices on which top Yahoo execs in Silicon Valley to keep and which to bid farewell too. Likely to stay, for example, is communications products head Jeff Bonforte; and likely to go is Adam Cahan, who has run a number of units under Mayer. On the bubble still: CRO Lisa Utzschneider (she wants to be a CEO apparently) and Enrique Muñoz Torres, who heads advertising and search product and engineering. CFO Ken Goldman is also departing, although on his own steam as has been expected since the Verizon-owned Oath is lousy with financial types in New York.

Finally, Oath’s leadership in Sunnyvale will supposedly be a mix of Yahoo and AOL execs and will focus on product and engineering for the entire combined company.

via http://ift.tt/2nUwSNX Tyler Durden