Month: March 2018

Libertarian Plays Spoiler in Close Pennsylvania Special Election

Libertarian congressional candidate Drew Gray Miller may have played spoiler in Pennsylvania’s down-to-the-wire special election last night.

Just after midnight, with all precincts reporting in the 18th district and some absentee ballots still being counted, Democratic candidate and former county prosecutor Conor Lamb had a 579-vote lead over the Republican, state Rep. Rick Saccone (R–Allegheny). Lamb declared victory early this morning, but Saccone has not yet conceded.

Meanwhile, Miller accumulated 1,372 votes—well more than the gap between the two major party candidates.

As the race tightened around 10 p.m., Miller took to Twitter to relish his newfound status as the guy who would be blamed for costing someone the election:

Needless to say, Miller’s 0.6 percent of the vote is not an outstanding showing. For comparison, Libertarian presidential nominee Gary Johnson received 2.4 percent of the statewide vote in 2016 and garnered at least 1.8 percent in each of the four counties that make up the 18th congressional district. Johnson also covered the spread in the presidential election, as Trump carried Pennsylvania by 1.1 percent.

Still, margins matter in close races. And this race was as close as they come.

“No party is entitled to anybody’s vote,” Drew Bingman, chairman of the Libertarian Party of Pennsylvania, told Reason on Tuesday night. “Maybe next time the Republican Party might consider somebody a little more libertarian.”

Bingaman praised Lamb for running a smart campaign that at times eschewed the national Democratic Party’s positions on issues like gun control. (Lamb’s first campaign ad featured footage of him firing an AR-15 at a shooting range.) Bingaman was impressed that a candidate like Lamb can win in a district that, on paper at least, is stacked in the GOP’s favor, and he took that as a welcoming sign for third-party candidates elsewhere.

It took until late in the evening for CNN and several other media outlets to add Miller’s name to their list of results. (He was the only other candidate in the race.) This happened only after it became clear that the Libertarian could cover the spread between the top two. The typical narrative emerged, that Miller had somehow cost Saccone the race:

“It’s a step forward as far as I’m concerned to be considered a spoiler,” Bingaman said, noting that it brought increased visibility to the candidate and party after the media largely ignored Miller’s campaign in the lead-up to the vote.

Regardless of the reason for the outcome, Tuesday’s result is certainly a disaster for Republicans. Trump won the district by 19 points in 2016. Outgoing Rep. Tim Murphy, who resigned after an affair with a staffer became public, did not even face a Democratic opponent two years ago. Republicans made a bad result worse when they publicly bailed on their candidate in the final hours of the race. National GOP leaders dumped on Saccone to Politico and tried to pin an seemingly inevitable loss on his poor fundraising skills—as if money is the most important factor in a post-Trump political landscape—only to have Saccone come within a few hundred votes of victory.

After Tuesday night, the top two candidates in the race will go their separate ways—literally.

The 18th district was dissolved by the state Supreme Court in January, when it ruled Pennsylvania’s congressional districts are an unconstitutional gerrymander. But those old lines were used for yesterday’s special election, because it had already been scheduled. The new map, imposed by the state’s high court (and subject to a challenge at the U.S. Supreme Court), splits the old 18th district into two new districts. Saccone resides in the new 14th district, and could run again for that seat in November. Lamb resides in the new 17th district, but so does another House incumbent: Rep. Keith Rothfus (R-Allegheny).

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The National School Walkout Reveals What Students Really Want: Safe Spaces

HoggStudents across the country plan to walk out of class at 10:00 a.m. today to protest the government’s failure to prevent crimes like the massacre at Parkland by tightening gun laws.

In doing so, the students are providing more evidence that increased safety is indeed the paramount goal of modern millennial and Gen Z political activism. They want to feel comfortable and protected, and they are willing to curtail other people’s rights to achieve this.

“It’s not Republican or Democrat; it’s about keeping people safe,” Arielle Geismar, a 16-year-old student from Manhattan, told Vox. “We know what we want from our society: to have less guns and, at some point, no guns at all.”

Perhaps ironically, the administrators at Geismar’s school also cited public safety as their top concern, and used it to justify their reticence about the planned walkout:

Arielle Geismar, a 16-year-old junior at the Beacon School in Manhattan, said her school administrators were primarily focused on student safety. “There definitely was pushback in terms of disrupting classes,” she said. “But we’re going to be loud, and we’re not going to apologize for that. I think that’s also the point of the walkout. We’re going to make ourselves heard whether you want to hear it or not.”

Of course Geismar and her fellow activists shouldn’t apologize for making themselves heard, being loud, or walking out of class. Nor should their First Amendment rights be curtailed because some overly cautious administrators are concerned about safety. Public safety is frequently used as a pretext for trampling the civil rights of some group or another. Think of racist stop-and-frisk policies, the anti-Muslim bigotry of domestic War on Terror paranoia, or the immigrant purges of the Trump era. Such measures are often justified on grounds of safety, security, and comfort.

Young people would therefore be justified in treating any safety-related abridgments of their rights with skepticism. Yet this post-Parkland student activism seems grounded in the exact same thinking: that we should sacrifice the rights of one group—gun owners—in order to make everybody else feel safer.

Whether doing this would actually make anyone safer is of course the subject of considerable policy debate. But just feeling safe is incredibly important to the current crop of high school and college students, who came of age during a time of increasingly paranoid parenting and hypersensitivity toward harm. Students certainly do deserve literal safety from violence. In many ways, they already do: Schools are safer than they used to be, and mass shootings are no more common. Unfortunately, these actual, dramatic social gains might seem counterintuitive to kids who live at a time of constant media coverage of murder, terror, and death. And the right caters to these fears by pushing airport-style security, more cops in schools, and metal detectors as reasonable solutions to school shootings, even though there’s little reason to believe these ideas work.

One of the main goals of this movement is to raise the legal age to purchase an AR-15 from 18 to 21, so these young activists are sometimes clearly willing to impose limits on their own freedoms as well as other people’s. Whatever you think of the gun issue, there’s reason to be concerned about just how much freedom the fragile generation would happily give away in order to feel safer—even when they’re getting safer already.

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Rex Tillerson’s Tenure as Secretary of State Was No Success—but What Comes Next Will Probably Be Worse: New at Reason

Nothing about Rex Tillerson’s firing should surprise us, except perhaps its timing.

Tillerson has often been at odds with his boss in the White House, whether on Russia, Iran, or North Korea. Though widely hailed as one of the “adults in the room,” it’s not clear he had much influence at all on Trump’s biggest foreign policy decisions.

He was widely disliked inside his own agency. Civil servants at Foggy Bottom hated his insularity and his plans to massively cut the State Department’s budget and diplomatic capacity.

Even the casual cruelty of the firing should not surprise us. Sure, the President fired his Secretary of State via Twitter, while Tillerson was abroad, without apparently offering him any explanation or courtesy phone call. But from the man who fired James Comey, his FBI Director, via television while Comey was on-stage giving a public speech, this was almost polite, writes Emma Ashford of the Cato Institute.

View this article.

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Gartman Makes “Watershed” Call: “Equity Markets Have Hit A Multi-Year Top”

Today is a “watershed” day, at least according to Dennis Gartman, who just hours after “covering his small remaining short position” has flipped again and is staking his reptuation that the market top is finally here.

The world-renowned commodity guru writes that his “long-time clients know that we do not write WATERSHED reports often and indeed we’ve not written one in many years… in fact we cannot remember when we put forth the last one but it was several years ago certainly” but today is one of those days when “we put our reputation hard upon the line… and we are doing so today, calling for a major, multi-year top on the equity markets following the recent volatility and following the reversals to the downside that took place yesterday in the Dow Industrials; the NASDAQ; the S&P and the Russell 2000.”

What is amusing is that as even Gartman notes “Market tops are hard to call; they take time to develop; they are messy, confusing, often embarrassing events that make those of us in the prognostication business appear beyond foolish at times as we try to fit an evolving thesis into an even more difficult evolving environment.” Which is ironic because as readers know, all it takes for Gartman to change his opinion is a 1% move in either direction for the “guru” to change his mind.

However, he adds, “the more we consider what we’ve written and what we’ve said in speeches and on television  regarding the movement by the monetary authorities to slowly removed the excess reserves they’d added to the banking systems and to the economies, and the violently random has been the trading environment of the past two or three months, with volume coming in as prices weaken and waning as prices advance, the more certain we are that henceforth when we trade equities we shall trade from the short side or we shall not trade at all.”

So what, according to Gartman, happens next?

We have lived through several great bear markets and perhaps that colors our thinking too egregiously, but we remember that the Dow fell from just over 1,000 to nearly 400 back in the early 70’s… and yes, the Dow really did trade down to triple digits back then, noting that recently the Dow “moved” more in one trading session than it actually was in the summer of ’74! At the peak, everyone was bullish; at the peak the Nifty Fifty were the FANGS of the day and everyone, everywhere owned them, believing them to be invulnerable. Many fell by 50, 60 even 80% when the bear market inevitably ran its course.

The reminiscences continue:

We remember that bear markets on the early 80’s and the “Double dip” recessions then as stock prices fell by more than 50% between the peak in ’77 and the bottom in the summer of ’82. We lived through the Crash of ’87 when the stock market fell 25% in the matter of a few days and when some individual stocks fell by 90+% in a few moments! Most of all we remember well the plunge in the stocks everywhere in the Dot.com collapse at the century’s turn when Microsoft’s shares fell by more than 60%; when Oracle and Nokia fell by nearly 80%; when Cisco’s shares fell by almost 90%…and these were the leading lights of the day. These were the FANGS of the time.

Closer to the present, Garmtan says that “we needn’t talk about the bear market of ’07-’09 for even the young among us should remember what happened then.”

The sky had previously been the limit; the economy was strong; euphoria was abundant. The “music” was pleasant; the women were beautiful and elegantly dressed; the world was viewed through a jaded lens. But soon the music stopped; soon the champagne went flat; soon the men grew rowdy and troublesome and soon the great party ended… badly.

Putting the above together, Gartman declares triumphantly that “this then is our WATERSHED comment; it is time to hold cash; it is time to sell rallies; it is time not to buy weakness. As T.S. Elliot Said, “Hurry up now, it’s time.” We can trade other things bullishly, but equities we’ll not and as he markets rally this morning we shall watch from the sidelines… waiting to act.”

Which would be great, if in the very same letter Gartman essentially admits he has no idea what he is doing:

We know that we have vacillated in our regard for equities of late, moving from bullish to bearish to bullish to bearish with too great regularity, but such is the demeanor of markets as they make important peaks: they make us appear foolish and ill advised, wearing out our margins and more importantly wearing out our psyches. But with the multiple “reversals” to the downside note above and with the volumes swelling each time as the markets fell and with the failures in so many instances well below the previous peaks, the stage finally is set for continued, manifest and perhaps material weakness going forward. Eventually, even “Old Turkey” is proven wrong.

Sorry bears.

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“Do Not Leave Your Homes” – Sleepy UK Town In Lockdown As Army Investigates Russian Spy Poisoning

Despite the UK’s promise to gather all of the facts before making an accusation in the poisoning attack on former Russian spy Sergei Skripal, officials from the British Army and Royal Air Force have been summoned to the north Dorset town of Gillingham as part of the investigation into the nerve attack, according to the Mirror.

Salisbury

While it’s not exactly clear what the military is doing in the sleepy coastal town, the media are speculating that the town is in lockdown due to some kind of connection with the attack. But exactly what that connection is, is unclear.

One thing is for sure: the Army have warned residents not to leave their homes.

 

 

But whatever the situation may be, it clearly requires a lot of firepower: The Mirror reports that two huge military vehicles have been seen thundering into the small town early Tuesday. A cordon has also been established to keep people away as a recovery vehicle towed away a car that may have belonged to one of the Skripals.

Salisbury

Residents told the Mirror that the car had been parked in the road for the last two days and they are worried they could have been exposed to health risks.

Skripal

Rumors suggested the car may have belonged to Yulia Skripal. She and her father were poisoned on March 4 in an attack that also left 18 bystanders and one police officer in critical condition. Another car was also seized at a village in Wiltshire, a town about 8 miles west of Gillingham.

Dorset police papered the town with noticed warning drivers to move their vehicles away from the Hyde Road area of town.

Notice

When approached for a statement, a Met Police spokesperson caustically declared: “There are a number of scenes in place, linked to the investigation into two people being taken ill in Salisbury on Sunday, 4 March. Enquiries are ongoing, and we won’t be providing a running commentary on the investigation.”

Police have also been photographed in protective suits.

Skripal

Tensions between the UK and Russia have escalated since Russia refused to respond to the UK’s request and warned it not to threaten “a nuclear power.”

Kremlin spokesman Maria Zakharova warned “no one can go to a parliament of their country and say: I give Russia 24 hours.”

In an apparent direct attack on foreign secretary Boris Johnson she said people with “absolutely nothing to do with foreign policy, who built their career on populism” should “not try to scare us.”

Russian Foreign Minister Sergey Lavrov has reportedly sent an official request to access the compound that the UK police have recovered so Moscow can test it. But the UK has so far been uncooperative.

British Army and Royal Air Force officials are reportedly on the scene in the town, along with cops and paramedics. According to the Daily Star, Met Police officials are understood to be in charge of the investigation currently unfolding in Gillingham.

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The Mysterious Crypto Billionaires Taking Over Puerto Rico

Authored by Michael Kern via SafeHaven.com,

Five months after Hurricane Maria, Puerto Rico is still struggling to rebound. As an unincorporated territory of the United States, the small island was sidelined when it came to restoration efforts. The U.S. Army Corps of Engineers estimates that over 10 percent of the island’s residents are still without power, though Carmen Yulin Cruz, Mayor of San Juan puts that number closer to 30 percent.

(Click to enlarge)

(Source)

Electricity isn’t the only concern for Puerto Ricans. Over 400,000 residents are still using blue tarps as roofs on their homes as they wait for federal assistance.

Cruz noted: “The U.S. government response has been inadequate, has been inefficient, and has been inappropriate.”

But this tragedy has turned into opportunity for some…

Crypto-Colonialism

A growing group of self-proclaimed “Puertopians” are flocking to Puerto Rico to set up a crypto-paradise. Because of its unincorporated status, the island has acted as a tax haven – and playground – for the super-rich for decades, and the new generation of crypto-millionaires is proving to be no exception.

The goal is to build an entirely new city with cryptocurrencies and blockchain tech as the foundation. The group has even been scouting the island for prospects, searching for a location where they will be able to build an airport and docks.

In the meantime, however, the Puertopians are occupying Old San Juan, eating at nice restaurants and living in upscale hotels in the heart of the colonial section of the city.

Upon closer inspection, this mysterious group and its high-profile leader are at the heart of one of the most bizarre movements in the modern era.

“Sol” and its Creator

The project, originally nicknamed “Puertopia,” had to change its name to “Sol” after it was pointed out that the Latin translation of its original name was “boy paradise” – the relevance of which will become clear as this story unfolds. “Sol” is headed by Brock Pierce, an extremely controversial, wealthy, and eccentric individual with a more-than-murky past.

Pierce is a polarizing figure in the crypto-space. As director of the Bitcoin Foundation, he has argued for the vast benefits of crypto-philanthropy, even suggesting that he would be giving away $1-billion of his personal funds to charity, but his unsavory rap sheet leaves a lot of questions that need answering.

Pierce, a former child actor, joined the world of digital business at 18 as the executive vice-president of the Digital Entertainment Network, which later came under fire over a massive child sex scandal that was featured in “An Open Secret,” directed by Amy Berg.

(Click to enlarge)

(Source)

The scandal first came to light in 2000, when employees and child actors alleged that Pierce and his partners, Chad Shackley and Marc Collins-Rector, were running a child abuse ring with several A-List actors, many of whom were tied financially to the network. It was alleged that this group would throw parties where minors would be given drugs, alcohol, and even forced to engage in intercourse at gunpoint.

Following the claims, Pierce and his counterparts resigned from the Digital Entertainment Network and fled to Spain. It was later revealed that Pierce settled out of court with accuser Michael Egan, for a sum of $21,600USD.

(Click to enlarge)

(Source)

While in Spain, Pierce formed IGE (Internet Gaming Entertainment), which acts as a broker-of-sorts for various in-game currencies, including Blizzard favorites World of Warcraft and Diablo 3. After several profitable years, and a noteworthy $60-million investment from Goldman Sachs, the company fell into a slump. In January 2007, the company was losing a reported $500,000 per month, and Pierce was ultimately replaced as CEO by none other than President Trump’s Ex-Right-Hand-Man, Steve Bannon.

Following several years of serial capitalism and philanthropic work, including donations to the Clinton Foundation, Pierce jumped into bitcoin headlines, founding the VC giant Blockchain Capital with Bart Stephens and Bradford Stephens in 2013. (Pierce has since been removed from the company’s webpage)

His early-adopter status, numerous connections, and tremendous wealth then propelled him to the position of Chairman of the Board of the Bitcoin Foundation a year later, resulting in the resignation of 10 key members, including Andreas Antonopoulis, who cited lack of transparency for his decision.

Since, Pierce has participated in numerous ICOs and crypto-ventures, including the wildly controversial Tether, which is supposedly a currency ‘tethered’ to the USD and closely connected to the world’s largest bitcoin exchange by volume, Bitfinex. While Tether refutes claims that the cryptocurrency is not, in fact, fully backed by USD reserves, a 2017 report from Nathanial Popper claims otherwise.

Back to Puerto Rico

With an understanding of the characters behind this latest initiative in Puerto Rico, we can now focus on what the apparent aims of these ‘Puertopians’ are.

Brock Pierce claims he is keen to “be a part of helping the Puerto Rican people”, believing that after the hurricane they will be able to “start over from scratch” and create a new utopia.

Hasley Minor, founder of CNET and fellow Puertopian went one step further when he called the hurricane a “perfect storm”, noting that “While it was really bad for the people of Puerto Rico, in the long term it’s a godsend if people look past that.”

The intentions, at first glance, may seem genuine, but the story itself, and the people involved, tell a very different story. So far, it seems less money has actually been spent on rebuilding the island than it has on avoiding taxes and sipping rum.

Another participant in this mysterious group, and Pierce’s partner at Tether, Reeve Collins, made no secret of his anti-tax position, explaining: “No, I don’t want to pay taxes,” as “This is the first time in human history anyone other than kings or governments or gods can create their own money.”

So, with tech majors and crypto-millionaires descending on Old San Juan, what are Puerto Ricans thinking?

Andria Satz, Old San Juan resident and employee of the Conservation Trust of Puerto Rico explains an ongoing trend on the island:

“We’re the tax playground for the rich. We’re the test case for anyone who wants to experiment. Outsiders get tax exemptions, and locals can’t get permits.”

And that’s exactly what has happened for years. Puerto Ricans have been excluded from participating in the gold rush while the mega-rich have exploited the island, its resources, and its people.  

It’s clear there is a stark contrast between the lavish lifestyles enjoyed by crypto-expats and the ongoing struggles of the citizens of Puerto Rico. And it raises an important question: is this just another case of the super-rich participating in disaster capitalism, re-colonizing a territory which has fallen victim to the same scheme from the ultra-rich time and time again? Or is this pseudo dream-team of tech heroes really going to save the day this time?

My money is definitely not on the latter, but I hope they prove me wrong.

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RIP Stephen Hawking, National School Walkout Today Over Gun Laws, U.K. Demands Answers From Russia on Nerve-Gas Attack: A.M. Links

  • Iconic scientist Stephen Hawking has died, his family announced Wednesday. He was 76.
  • High-school students across the country are planning to skip school today—you know, for politics.
  • “Despite Mr. Trump’s boast, the choice of [Gina] Haspel for promotion” to CIA Director “is no victory for women,” writes New York Times op-ed writer Mona Eltahawy.
  • Dogs will now be allowed in Virginia breweries, wineries, and distilleries.
  • Democrat Conor Lamb is being named the (narrow) victor over Republican Rick Saccone in a special election in Pennsylvania’s 18th District.
  • The U.K. Foreign Ministry is calling for an urgent U.N. Security Council meeting on the poisoning of former Russian spy Sergei Scripel and his daughter Yulia in a small British town, as Prime Minister Theresa May demands answers from Russia that haven’t come.

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    Profit Margins In Peril As Core Producer Prices Jump The Most Since August 2014

    The smell of stagflation is strong this morning, because just as retail sales missed badly on both the headline and the core prints as noted separately, and as BofA predicted last night, PPI came in a hotter than expected, with both headline PPI (0.2%) and PPI ex food, energy and trade (0.4%) coming in higher than the expected prints of 0.1% and 0.2% respectively after a mixed picture from yesterday’s CPI print.

    The index for final demand less foods, energy, and trade services climbed 0.4 percent in February, the same as in January. For the 12 months ended in February, core core PPI, i.e., prices for final demand less foods, energy, and trade services increased 2.7%, the largest rise since 12-month percent change data were available in August 2014.

    More troubling, on an unadjusted basis, the final demand index increased 2.8% for the 12 months ended in February, clearly suggesting that input costs are starting to impact business who are unable to pass on rising prices to consumers, and instead are forced to shrink their profit margins as a result.

    A breakdown of all key PPI components is below.

    Looking at final demand services, a major factor in the February rise of 0.3% in prices was the index for traveler accommodation services, which climbed 3.7%. The indexes for automotive fuels and lubricants retailing, food retailing, bundled wired telecommunications access services, hospital inpatient care, and airline passenger services also moved higher. In contrast, margins for machinery, equipment, parts, and supplies wholesaling fell 1.4 percent. The indexes for apparel, jewelry, footwear, and accessories retailing and for cable and satellite subscriber services also decreased.

    Separately, final demand products declined by 0.1%; leading the February decrease in the index for final demand goods, prices for fresh and dry vegetables dropped 27.1%. The indexes for gasoline, light motor trucks, diesel fuel, and liquefied petroleum gas also moved lower. Conversely, prices for primary basic organic chemicals jumped 7.2 percent. The indexes for chicken eggs, residential natural gas, and beef and veal also advanced.

    What happens next will be key: with input prices rising, whether companies are able to pass on these higher costs to end consumers will determine if profits margins shrink, or if inflation will truly blossom as consumer prices follow the surprising move higher in PPI.

     

     

     

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    Retail Sales Drop For 2nd Straight Month

    Following a disappointing drop in January, expectations were for a 0.3% rise in retail sales in Feb but BofA was far less sanguine, warning that sales could miss because tax benefits only went to people who had withholdings reduced, not those who actually got a refund as they were delayed.

    And BofA was right, Retail Sales dropped 0.1% MoM (with Jan revised up to -0.1%), falling for the second straight month for the first time since October 2015.

    Retail Sales disappointed across the board with Ex-Auto , Ex-Auto & Gas, and Control Group all missing expectations.

    This retail sales print is the lowest analyst expectation…

    Under the hood… Energy and Food costs fell most as Transportation jumped…

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    Don’t Deny Young Adults the Right to Self-Defense: New at Reason

    After last month’s mass shooting at a high school in Parkland, Florida, Donald Trump said he favored raising the minimum age for buying rifles or shotguns from federally licensed dealers, currently 18, to 21. On Monday he backed away from that position, saying the decision should be left to the states.

    The president was immediately criticized for kowtowing to the National Rifle Association. But Jacob Sullum says there are sound reasons, aside from crass political considerations, for questioning the effectiveness and fairness of new restrictions on young adults’ access to firearms.

    View this article

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