Trucker Bust Begins As Oversupply Plagues Freight Industry, Spot Rates Crash 

Recent economic reports from the trucking industry show the transportation recession continues to deteriorate through summer, with no end in sight. This is the second transportation recession since the 2008 crash, outlining that freight is a very cyclical business.

Freight companies are dealing with a hangover from last year’s economic sugar high, driven by President Trump debt-fuelled tax cuts and a trade war, that forced importers to build inventory ahead of tariffs. This led to higher demand for big rigs in 2018 as imported items had to be shipped from the port of entries to warehouses.

Freight companies used 2018 profits and the earnings from the 2017 tax cuts to record one of the largest orders for new trucks in some time, resulting in an explosion of overcapacity while cargo volumes started to slide in late 2018, reported The Wall Street Journal.

The global economy started slowing in 1Q18, a quarter or so before President Trump launched the first significant punch in the trade war against China. This means an industrial slowdown around the world was structural and unrelated to tit-for-tat tariffs between both countries. By August 2018, ISM manufacturing and UST5Y peaked and had a drastic reversal, due to the start of a domestic industrial slowdown.

Freight executives warn that the industrial slowdown and trade tensions that started last year have reared their ugly heads in the freight industry this year. Companies pulled imports forward late last year ahead of anticipated tariffs are now working through excess inventory piled up in warehouses put a damper on 2019 shipments.

“We’re three months into a freight recession,” said Jack Atkins, a transportation analyst with Stephens Inc.

The spot price to contract a big rig collapsed 18.5% in June on a YoY basis, to $1.89 per mile, according to online freight marketplace DAT Solutions LLC. DAT has recently said there were three loads for every available truck, compared with six loads per vehicle in June 2018.

“The industry bought a lot more trucks than we realized that they did,” Doug Waggoner, chief executive of freight broker Echo Global Logistics Inc., said in a July 24 earnings call. “Relative to last year at this time, there is less demand for capacity and that, coupled with an oversupply of trucks, means there’s little to no spot freight and all truckload prices have come down dramatically.”

Earlier this month, Knight-Swift Transportation, the largest freight carrier in North America, slashed its profit outlook for the second and third quarters, warning “the oversupply of capacity in the truckload freight market” was crushing revenue per loaded mile.

Carrier executives said a credit crunch is headed for the freight industry in the coming quarters, indicating increasing cancellations of truck orders and bankruptcies among smaller regional carriers was adding stress to the industry.

Truck manufacturers like Freightliner, Kenworth, Peterbilt, and International, are still working through order backlogs and fleets continue receiving delivery of new trucks, said Kenny Vieth, president of transportation industry data provider ACT Research, which monitors Class 8 trucks.

“Freight as we measure it is growing at less than 1% in 2019,” Vieth said. “Our modeling suggests that we are adding about 7% to the U.S. Class-8 market capacity…. So the supply-demand equilibrium is tilting away from truckers right now.”

As we mentioned earlier, most of the economic weakness originated from an industry slowdown, so trucking related to consumer demand has been somewhat stronger than the rest of the industry.

The energy sector has felt the brunt of the industrial slowdown. Rig counts peaked in November 2018, have since declined by 12.5% overall. In the last 50 days, domestic oil production has dropped about 9% from its peak, a violent reverse that is the result of a deteriorating economy. Another industrial sector cycling down is residential construction. With industrial demand waning from big rigs, DAT Flatbed Barometer shows the plunge:

Alternative data, like trucking, serves as a good proxy as to the directional heading of the economy. Freight data overall paints a dire picture for the economic outlook in 2H19.

As Wolf Richter via Wolf Street writes: “The cyclicality in trucking is also based on the classic mismatch in the timing of demand for transportation that creates a capacity crunch because there aren’t enough trucks, as it had done last year, that in turn creates a boom in orders of trucks. And when a few quarters later those trucks are being delivered, this is precisely when demand for transportation is starting to slow down, cycling the industry from capacity crunch to overcapacity in a very short time.”

And to summarize the global industrial slowdown in one chart. Here’s Global Trade YoY crashing to levels not seen since the last financial meltdown.

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Auer Deference Post-Kisor

Auer deference, under which courts are required to defer to reasonable agency interpretations of their own ambiguous regulations, has long been one of the more problematic doctrines within administrative law. This past term, in Kisor v. Wilkie, the Court was asked to overturn Auer, but only four justices were willing to take that step.

The Supreme Court may not have been willing to eliminate Auer deference in Kisor , but it certainly attempted to bring it to heel. Justice Kagan’s opinion for the Court claimed to uphold Auer v. Robbins, yet her opinion for the Court emphasized the limits on Auer deference, as it also “compile[d] and further develop[ed]” them. As reformulated in Kisor, Auer deference now requires a context-dependent, five-step analysis in order to determine whether a court must defer to an agency’s interpretation of its own regulation.

As Justice Kagan’s opinion for the Court makes explicit, Auer deference has a limited role to play in administrative law, and should only be applied in a limited set of circumstances. For starters, the question of Auer deference may only arise if the regulation at issue is truly ambiguous—not merely complicated or technical, but truly ambiguous. As Justice Kagan explained, “a court cannot wave the ambiguity flag just because it found the regulation impenetrable on first read.” The reviewing court must utilize all of the traditional tools of textual interpretation and can only even consider deference upon concluding the regulation at issue contains “genuine ambiguity” as to the question at hand.

But ambiguity is not enough. The agency’s interpretation must constitute a reasonable interpretation of the relevant text, represent the agency’s official and authoritative interpretation, be with within the agency’s expertise, and reflect the agency’s considered judgement with due regard for notice and reliance interests. Auer deference remains to be used “where it applies,” Justice Kagan explained, but “it often doesn’t.”

The upshot of Kisor is that reviewing courts should rely upon Auer deference to resolve cases less often than they have to date. Indeed, this was the result in Kisor itself, where every justice agreed the Federal Circuad been too quick to conclude the applicable VA regulation was ambiguous and that the VA’s interpretation merited deference.

The Supreme Court has given us a more “tame” and less “menacing” Auer doctrine.  The question is whether lower courts will get the message. For while Justice Kagan’s opinion is clear, the headline result is still that Auer v. Robbins was not overturned and Auer deference is still with us. Some courts make take this as a reason to continue on as before, particularly when the alternative is assuming responsibility for the heavy interpretative lifting.

One of the first courts to consider how Kisor modifies the application of Auer was the Oregon Supreme Court—and the justices split over the question. In Eastern Oregon Mining Association v. Department of Environmental Quality, the court considered the application of the Clean Water Act’s permitting requirements to suction dredge mining. A majority of the court concluded Kisor supported its conclusion that the state DEQ’s permit was valid under the CWA and applicable regulations.

The court was not unanimous. One justice dissented, arguing that Kisor required the court to look more closely before deferring to a federal agency’s interpretation of its own rules. Whether or not the majority reached the correct conclusion on the ultimate question, the dissent makes a persuasive case that the majority failed to heed Justice Kagan’s admonition not to rush to deference.

Perhaps the Oregon Supreme Court reached the right bottom line, and perhaps this is a one off. Kisor has scarcely been on the books for a month, so few courts have dug into it. Yet it will be interesting to see whether lower courts heed the message that Auer deference has a far more limited role to play in a post-Kisor world.

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These Are The World’s Lowest Cost Gold Mines

Authored by Tom Lewis via GoldTelegraph.com,

Gold has been a medium of exchange for thousands of years. It is easy to carry, and its very rarity makes it a valuable commodity. While we can’t be certain how much gold remains undeveloped, the cost of finding and mining gold is increasing. First, new deposits need to be discovered and explored; then the find must be analyzed. Only then can a mining company bring the equipment to extract the precious ore.

It’s a long and expensive process from ore to gold bullion, and the price of gold must keep up with the cost of production. It’s important to remember, however, that every ounce of gold produced will be around forever because of its physical properties.

The price of gold may fluctuate, but gold will retain its value at all times because of its physics and universal recognition.

Due to higher production costs, mining companies need to operate efficiently. In 2019, the average all-in sustaining costs (AISC) of mining for gold rose to $1,000 per ounce from $988 per ounce in the last quarter of 2018. Indications are that the major mining companies can control their cost of production and keep their operations cost-efficient. This is excellent news for investors.

Below is a list created by Mining Intelligence of the top primary gold production companies and their production costs. A primary gold operation is a mining company which derives 80 percent of its revenues from gold production.

Six of the top 10 lowest cost mines shown have seen their costs decline during Q1 2019, led by Kirkland Lake’s Fosterville located in Australia. Fosterville Mine has been the leader in cost efficiency for the past two quarters. Their gold production rose to 356,230 ounces in 2018, with 400,000 ounces anticipated by the end of 2019.

Barrick’s Pueblo Viejo in the Dominican Republic also tops the charts for world’s lowest gold production cost at below $550 an ounce in 2019. Barrick mined 581,000 ounces of gold in 2018 at a cost of $623 per ounce. The company has announced a billion-dollar expansion project.

Three gold mines showed a 20 percent or more improvement in their production costs, which also placed them in the top ten cost-efficient mining companies. These companies are:

Evolution Mining in Queensland, Australia, owns the Mt Carlton open-pit mine which has produced 100,000 ounces of gold for three years in a row.

Kainantu Mine in in Papua New Guinea. Kainantu is producing 120,000 ounces of gold annually and attempting to surpass that goal.

Polyus Mine’s Olimpiada mine in Natalka, Russia is another mine with considerable production promise.

Kumtor Mines is owned by Centerra and is located in China. Kumtor is Central Asia’s largest gold mining operation. It produced 534,563 ounces of gold in 2018.

A welcome addition to the top-ten list is the Canadian-based Semofa’s Natougou-Boungo mine located in Burkina Faso. This open pit mine has shown considerable promise while keeping mining operation costs at $534 an ounce.

Three mines that were dropped from the top-ten list were Norgold’s Neryungri mine in Russia, Alacer’s Copler mine in  Erzincan, Turkey, and Hounde mine in Burkina Faso.

While much of the world’s gold may have already been found and mined, exploration efforts should ramp up in this next bull market with the hunt for finding and expanding deposits.

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Beyond Meat Completes Secondary Offering At Massive Discount

Beyond Meat shares are trading down notably in the after-hours following a Bloomberg report that, according to a person familiar with the matter, BYND and its inside shareholders priced a secondary offering at $160 per share – a dramatic 18.6% discount to tonight’s close.

The transaction lets early investors such as Kleiner Perkins and Obvious Ventures and executives including Chief Executive Officer Ethan Brown take profits on a small portion of their stakes after an almost eight-fold gain since the stock’s debut.

The question is, does that $160 secondary level act as a floor? Or will it be the critical threshold for shorts to test?

Finally, for those considering shorting this fake meat farce, don’t forget that BYND is still the most-expensive short in the market. As Bloomberg reports, according to July 30 datafrom financial analytics firm S3 Partners, the last transaction went off at 197%.

There is one silver lining for shorts – the secondary offering will likely release some more shares to borrow on to the market and may, somewhat ironically, lower carry costs.

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“The Bigger The Farm, The Bigger The Gov’t Check” – Bailout Goes To Richest Farmers

More than half of President Trump’s $8.4 billion bailout for American farmers through April was received by the top 10% of wealthiest farmers, the Environmental Working Group (EWG) said in a new study published Tuesday.

EWG said the bailout “overwhelmingly flowed to the largest and most successful farmers,” which left very little money for the mom-and-pop farmers affected by the trade war with China.

The advocacy group said top 1% of bailout recipients received on average $180,000 while the bottom 80% collected less than $5,000 for their trade war-induced financial hardships.

The group acquired that data from the US Department of Agriculture via a Freedom of Information Act request. The data showed bailout payments made through the first two rounds of the Market Facilitation Program (MFP). Through April, total MFP payments for 2018-19 were $8.4 billion.

The Trump administration began administering farm bailouts last year after China halted purchases of soybean. Chinese buyers aren’t expected to resume agricultural purchases in 2H19.

As of Wednesday, the latest round of trade talks between both countries collapsed after a half-day of negotiations. The US trade delegation broke off talks with its Chinese counterpart and is already on its way back to Washington, a sign that no new progress was made, and that the probability of China buying agriculture products from the US has collapsed. China will likely continue sourcing from Latin America.

As a result of the trade war, soybean exports to China have crashed to levels not seen since 2004.

The first of the bailouts, announced in 2018, was approximately $12 billion. As China pulled back even more on US agriculture purchases, the Trump administration rushed to issue a second bailout last week, includes $16 billion and $14.5 billion of that are direct payments.

EWG said 82 farms have so far received more than $500,000 in payments but has left many small farms on the brink of bankruptcy.

The group said the first bailout had been associated with crop production, favoring the largest farmers. The second bailout, debuted last week, would support big farms because it was created to pay per acre, EWG said.

The bigger the farm, the bigger the government check,” it said. A USDA spokeswoman said aid payments were made based on a producer’s individual production. “The more acres they farm and bushels per acre they produce – the more assistance they receive,” she said in emailed comments to Reuters.

President Trump’s trade-war-driven farmer bailout is a clear indication that the government is handing out free money, picking winners and losers, and redistributing wealth, otherwise known as socialism.

When the government intervenes in markets, they always tend to break something, this time it was the president’s base located in rural America, scattered throughout the Midwest.

The consequences of the trade war are taxpayer-funded bailouts; the consequences of bailouts is an uneven distribution of wealth that has gravitated towards the richest farmers, driving financial hardships for mom-and-pop farmers that could culminate into another farm crisis on par to the early 1980s.

The moral of the story: Get government out of markets!

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Nunes: FBI/CIA’s Actions Against Trump Campaign Overseas Must Be Investigated

Authored By Sara Carter via SaraACarter.com (emphasis ours)

The top Republican with the House Intelligence Committee Rep. Devin Nunes told SaraACarter.com there is insurmountable evidence of the FBI’s malfeasance regarding the bureau’s probe into President Trump’s 2016 campaign and Russia, but what must be investigated is the FBI’s actions overseas into the campaign.

Those questions will also naturally involve the CIA and any relationship the clandestine agency had with the bureau during the Russia probe, Nunes said.

What has been revealed during the course of nearly three years of investigations by the Intelligence Committee and others, is that the FBI had informants spying on the campaign. The most damning information was that the FBI had specifically targeted volunteers with the Trump campaign: Carter Page, George Papadopolous, as well as others who traveled outside the United States. Once they were overseas, the FBI had continuing operations and received information from informants to build an investigation into the Trump campaign and Russia.

The details of what actually took place and when the investigation by the bureau actually began, however, remain murky. Nunes said there needs to be a thorough investigation into the role of the FBI and CIA regarding the Trump probe.

There are so many unanswered questions about what happened in Cambridge, where numerous people were making strange unexplained attempts to contact Trump associates,” Nunes told SaraACarter.com. “We already know the FBI committed a lot of abuses in this investigation, and we want to discover whether more were being committed overseas.”

Nunes is referring to the University of Cambridge in London, ‘Cambridge Intelligence Seminar,’ where employees made successful attempts in contacting members with the  Trump campaign in 2016, including Carter and Papadopolous.

The CIA And FBI

Nunes also spoke with Maria Bartiromo Sunday on Fox News saying that former CIA Director John Brennan still needs to answer questions. He said it’s important for DOJ investigators to know whether it was the FBI or CIA, or both, that lined up confidential sources to contact the Trump campaign.

“Well, as you know, we have jurisdiction over both FBI and CIA and what they do overseas,” Nunes told Bartiromo on Sunday Morning Futures. “We have lots of information about FBI people going overseas and doing things, we don’t really have any information from CIA.”

So far, they’ve really come clean. I would say the only one who has questions to answer is John Brennan, because we now know that John Brennan briefed Harry Reid on the dossier in August 2016. At the same time he never briefed me or Paul Ryan who was the speaker of the House at the time.”

Nunes has also been pushing for the public release of currently declassified documents turned over by President Trump to the DOJ’s Attorney General William Barr. Those documents are expected to reveal details of the FBI’s investigation into the Trump campaign. In particular information regarding Page and Papadopolous, which sources say will expose that the FBI withheld exculpatory information from the Foreign Intelligence Surveillance Court.

According to several sources some of those documents could come as early as this week or next. But Barr has received fierce pushback from some in the intelligence community, including Brennan. After Trump ordered the intelligence community to cooperate with Barr the New York Times reported that if Barr declassifies the documents he would reveal one of the agencies most trusted assets in Russia.

According to the New York Times the asset is “close to [Vladimir] Putin” and someone who gave the CIA “information about [Putin’s] involvement” in U.S. election interference.

However, according to sources that spoke with SaraACarter.com, who have knowledge of the documents, Barr would not reveal any information that would harm U.S. national security.

The Professors: Mifsud And Halper

Durham’s investigation is also looking into Professor Joseph Mifsud, who made direct contact with Papadopolous. Mifsud shared information with the young campaign volunteer suggesting the Kremlin had the missing Hillary Clinton emails during the  2016 campaign. Mifsud’s attorney has told The Hill’s John Solomon, that his client was a “longtime cooperator of western intel.” This claim is huge because it is thoroughly missing from former Special Counsel Robert Mueller’s report and begs the question: Why would a source connected to western intelligence be giving a Trump campaign official information from Russian’s suggesting they had Clinton’s emails?

Mueller’s report contends that Papadopolous contact with Mifsud was the reason the bureau initiated the investigation into the Trump campaign at the end of July, 2016. The bureau dubbed the investigation ‘Crossfire Hurricane,’ as the New York Times first reported.

Further, there are questions regarding Mifsud’s contacts with others at Link University in Rome and the London Center of International Law Practice (LCILP). Both of these policy institutes have ties to western intelligence.

The task of investigating the actions of the bureau and CIA overseas DOJ appointed prosecutor John Durham, the U.S. attorney in Connecticut, and simultaneously Inspector General Michael Horowitz will not be easy, “as they navigate the various agencies and contend with classified information and sources,” said one former U.S. intelligence official, familiar with Russia.

Durham Questioning CIA Officers

Durham is also believed to be questioning senior CIA personnel, according to a recent New York Times report.   According to The Times Durham’s inquiry is directly related to the Russia investigation and “focused partly on the intelligence agencies’ most explosive conclusion about the 2016 election: that President Vladimir V. Putin of Russia intervened to benefit Donald J. Trump.”

More importantly, the inquiry shows the expansive nature of the Justice Department’s probe into the FBI and it’s handling of the case.

Durham’s inquiry reveals that the DOJ is investigating every aspect of the Russia Trump probe and the connection the FBI had with the agency.

There is no possible way that Brennan didn’t know what was going on during the FBI’s investigation, particularly when agents were working with sources overseas in London and Italy,” the official said. “The agency would have been well aware of the issue, particularly because it involved a presidential candidate.”

Another major player in the DOJ’s investigation is former Cambridge Professor Stefan Halper, who was outed as an informant for the bureau, as previously reported. Halper was the director of American studies in the Department of Politics and International Studies at Cambridge. There, he taught classes and worked on research papers for Chatham House in London, the Center for Strategic and International Studies in D.C., and the U.S. Naval War College. He also has a close working relationship with former MI6 Director Sir Richard Dearlove. Dearlove was the director from 1999 to 2004. His extended family was also tightly connected to the agency.

Grassley’s Inquiry Into The DOD Payments To Halper

Currently, Finance Committee Chairman Chuck Grassley is investigating financing that was provided by the Department of Defense’s Office of Net Assessment to Halper. He sent a letter early this month asking DOD Acting Secretary Mark Esper for more information regarding contracts awarded to Halper.

Grassely, R- Iowa, stated that the information be provided no later than July 25. He also requested a full in person briefing with his committee staff on all of Halper’s contracts with the DoD.

Grassley’s committee asked for the information after an audit was released by the DoD’s Inspector General’s showed that there was failure to conduct appropriate oversight of contracts awarded under the DOD. Halper had long career in the U.S. government under several GOP administrations. His connections to the CIA and FBI are extensive and he had been awarded multiple contracts with the DOD totaling $411,000 by Washington Headquarters Services on Sept. 26, 2016, for a contract that ran until this March, 2018, according to USASpending.gov.

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Josh Hawley: What Has Technology Done for Us Lately?

While speaking to a group of young conservatives on Wednesday, Sen. Josh Hawley (R–Mo.) made the bizarre claim that the biggest problem with technology today is the lack of innovation.

His “biggest critique of big tech,” Howley said, “is: what big innovation have they really given us?”

“I mean, we just celebrated the 50th anniversary of the moon landing. Think about what the tech sector gave to America in the 1960s—just in that decade, think about what the tech sector gave to America,” Hawley said. His remarks, delivered before a gathering hosted by the Young America’s Foundation, a conservative nonprofit, were recorded and posted to Twitter by audience member Greg Price.

“What is it now that in the last 15, 20 years that people who say they are the brightest minds in the country have given this country?” Hawley continued. “What are their great innovations?”

Hawley should pick up the latest issue of Reason, half of which is devoted to the many ways in which the world is getting better. He’d be shocked to learn that a lot of those improvements are due to modern technological innovations. “We live in a world of reliable miracles,” writes Reason Editor in Chief Katherine Mangu-Ward. It is a world where deaf people can be made to hear with the use of cochlear implants, where the nearly blind can have their vision restored by lasers, and where paraplegics have access to advanced prosthetics that let them walk.

Adrianne Haslet-Davis lost a leg in the Boston Marathon bombing, but now, thanks to technology, she can do this:

That prosthetic was designed by Massachusetts Institute of Technology biophysicist Hugh Herr, who also happens to be a double amputee. As Associate Editor Mike Riggs detailed in that same issue of Reason, Herr’s latest project is a surgical procedure that will allow the brain to control robotic limbs as if they were part of your body. That’s technology!

There’s also a Silicon Valley biotech firm that’s developing artificial pancreases for diabetics. Technology!

It’s not just medical technology that’s getting better and better, though that’s obviously Hawley’s biggest blindspot. Hawley wants to sneer at the vapidity of Snapchat “streaks” and fret over YouTube’s “autoplay” feature, but he’s ignoring the real ways in which social media companies are making the world a better place.

“Social media and Google and such things have revolutionized public discourse,” says Price, who posted the video of the senator’s speech and also questioned Hawley about the bill. “There’s certainly ways to criticize specific actions of the companies without making the government our social media nanny.”

Daisy Soderberg-Rivkin, a technology fellow at the R Street Institute, a free market think tank, points out that social media has helped people topple oppressive regimesrespond to disastersbuild democracy, and expose human rights abuses.

“I think what this senator often forgets is that social media is not just a way for users to scroll through endless videos of puppies, or talk to friends about their last vacation,” says Soderberg-Rivkin. “To claim that social media does more harm than good is a broad generalization that underestimates the power of users to harness technology to make a real difference.”

That Hawley seems unable to grasp the value of such things is a good indication that he’s the wrong guy to be leading a legislative crusade against technology.

But leading one he is. Earlier this week, Hawley introduced a bill that aims to regulate how Americans use social media. As Reason Features Editor Peter Suderman explained yesterday, Hawley’s proposal would “outlaw such features as infinite scroll and Snapchat’s ‘streaks,’ which encourage users to engage in unbroken communications with friends. The bill would additionally require social media companies to install time-use dashboards, and it would give the Federal Trade Commission and the Department of Health and Human Services the power to regulate other features in the future.”

Hawley’s bill is one of the first legislative ideas to emerge from a growing conservative backlash against modern technology—a backlash generated in part by Fox News’ Tucker Carlson and others in the nascent “national conservatism” movement. They are all making the same mistake: dismissing the obvious benefits of technology while focusing solely on some of the unproductive trade-offs.

Recent technologies have helped countless Americans live longer, better, healthier, happier lives. And while scrolling through a never-ending Instagram feed might not be as valuable as the development of prosthetic limbs, both innovations add value to the human experience and should be free from government interference.

What has technology done for us lately? Just open your eyes.

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Josh Hawley: What Has Technology Done for Us Lately?

While speaking to a group of young conservatives on Wednesday, Sen. Josh Hawley (R–Mo.) made the bizarre claim that the biggest problem with technology today is the lack of innovation.

His “biggest critique of big tech,” Howley said, “is: what big innovation have they really given us?”

“I mean, we just celebrated the 50th anniversary of the moon landing. Think about what the tech sector gave to America in the 1960s—just in that decade, think about what the tech sector gave to America,” Hawley said. His remarks, delivered before a gathering hosted by the Young America’s Foundation, a conservative nonprofit, were recorded and posted to Twitter by audience member Greg Price.

“What is it now that in the last 15, 20 years that people who say they are the brightest minds in the country have given this country?” Hawley continued. “What are their great innovations?”

Hawley should pick up the latest issue of Reason, half of which is devoted to the many ways in which the world is getting better. He’d be shocked to learn that a lot of those improvements are due to modern technological innovations. “We live in a world of reliable miracles,” writes Reason Editor in Chief Katherine Mangu-Ward. It is a world where deaf people can be made to hear with the use of cochlear implants, where the nearly blind can have their vision restored by lasers, and where paraplegics have access to advanced prosthetics that let them walk.

Adrianne Haslet-Davis lost a leg in the Boston Marathon bombing, but now, thanks to technology, she can do this:

That prosthetic was designed by Massachusetts Institute of Technology biophysicist Hugh Herr, who also happens to be a double amputee. As Associate Editor Mike Riggs detailed in that same issue of Reason, Herr’s latest project is a surgical procedure that will allow the brain to control robotic limbs as if they were part of your body. That’s technology!

There’s also a Silicon Valley biotech firm that’s developing artificial pancreases for diabetics. Technology!

It’s not just medical technology that’s getting better and better, though that’s obviously Hawley’s biggest blindspot. Hawley wants to sneer at the vapidity of Snapchat “streaks” and fret over YouTube’s “autoplay” feature, but he’s ignoring the real ways in which social media companies are making the world a better place.

“Social media and Google and such things have revolutionized public discourse,” says Price, who posted the video of the senator’s speech and also questioned Hawley about the bill. “There’s certainly ways to criticize specific actions of the companies without making the government our social media nanny.”

Daisy Soderberg-Rivkin, a technology fellow at the R Street Institute, a free market think tank, points out that social media has helped people topple oppressive regimesrespond to disastersbuild democracy, and expose human rights abuses.

“I think what this senator often forgets is that social media is not just a way for users to scroll through endless videos of puppies, or talk to friends about their last vacation,” says Soderberg-Rivkin. “To claim that social media does more harm than good is a broad generalization that underestimates the power of users to harness technology to make a real difference.”

That Hawley seems unable to grasp the value of such things is a good indication that he’s the wrong guy to be leading a legislative crusade against technology.

But leading one he is. Earlier this week, Hawley introduced a bill that aims to regulate how Americans use social media. As Reason Features Editor Peter Suderman explained yesterday, Hawley’s proposal would “outlaw such features as infinite scroll and Snapchat’s ‘streaks,’ which encourage users to engage in unbroken communications with friends. The bill would additionally require social media companies to install time-use dashboards, and it would give the Federal Trade Commission and the Department of Health and Human Services the power to regulate other features in the future.”

Hawley’s bill is one of the first legislative ideas to emerge from a growing conservative backlash against modern technology—a backlash generated in part by Fox News’ Tucker Carlson and others in the nascent “national conservatism” movement. They are all making the same mistake: dismissing the obvious benefits of technology while focusing solely on some of the unproductive trade-offs.

Recent technologies have helped countless Americans live longer, better, healthier, happier lives. And while scrolling through a never-ending Instagram feed might not be as valuable as the development of prosthetic limbs, both innovations add value to the human experience and should be free from government interference.

What has technology done for us lately? Just open your eyes.

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Endgame: Starting In 2024, All US Debt Issuance Will Be Used To Pay Only For Interest On Debt

While it is common knowledge that the US budget deficit is soaring even though the US economy is allegedly growing at a brisk, mid-2% pace (and yet the Fed is about to cut rates), resulting in recurring bond trader nightmares about funding the growing twin US deficits (Budget and Current Account), what few people know is the increasingly ominous composition of this budget deficit.

As we first pointed out back in March, when looking at the US ‘income statement’, most concerning by far is that for the first four months of fiscal year 2019, interest payments on the U.S. national debt hit $221 billion, 9% more than in the same five-month period last year, with the rate of increase breathtaking (see chart below). As a reminder, according to the Treasury’s conservative budget estimates, interest on the U.S. public debt is on track to reach a record $591 billion this fiscal year, more than the entire budget deficit in FY 2014 ($483 BN) or FY 2015 ($439 BN), and equates to almost 3% of estimated GDP, the highest percentage since 2011. In fact, as of June 30, US interest had already surpassed $600 billion.

It only gets worse from there.

 

As part of today’s Treasury Presentation to the Treasury Borrowing Advisory Committee, there is a chart showing the Office Of Debt Management’s forecast for annual US debt issuance, broken down between its three component uses of funds: Primary Deficit, Net Interest Expense, and “Other.”

That chart is troubling because while in 2019 and 2020 surging US interest expense is roughly matched by the other deficit components in the US budget, these gradually taper off by 2024, and in fact in 2025 become a source of budget surplus (we won’t be holding our breath). But what is the real red flag is that starting in 2024, when the primary deficit drops to zero according to the latest projections, all US debt issuance will be used to fund the US net interest expense, which depending on the prevailing interest rate between now and then will be anywhere between $700 billion and $1.2 trillion or more.

In short: in the stylized cycle of the US “Minsky Moment”, the US will enter the penultimate, Ponzi Finance, phase – the one in which all the new debt issuance is used to fund only interest on the debt – some time around in 2024.

From that point on, every incremental increase in interest rates, which will eventually happen simply due to rising inflation expectations, will merely accelerate the ponzi process, whereby even more debt is sold just to fund the rising interest on the debt, requiring even more debt issuance, and so on, until finally the “Minsky Moment” arrives.

At that point, while we don’t know yet what the next reserve currency – either fiat, hard or digital – after the US dollar will be, we urge readers to own a whole lot of it.

via ZeroHedge News https://ift.tt/2Kg14gn Tyler Durden

Hacked Highways? Connected Cars Could Gridlock Entire Cities, Study Warns

Authored by John Anderer via StudyFinds.org,

Cybersecurity has quickly become a priority for large corporations, businesses, and individuals alike in recent years. It seems like another major data breach is being reported every other week, and personal online accounts are often compromised by malicious actors.

Now, a new study out of the Georgia Institute of Technology has found that hackers may soon be able to cause major traffic problems in the real world by hacking and stranding internet-connected cars.

The study’s authors theorize that hackers would only have to shut down a portion of cars on the road in a busy city like Manhattan during rush hour to completely shut down traffic and gridlock the city. Researchers hope that their findings will spark a more detailed analysis of automotive cybersecurity, especially moving forward as cars become more and more high tech.

“Unlike most of the data breaches we hear about, hacked cars have physical consequences,” says co-author Peter Yunker in a release.

Yunker and his team say that right now the automotive cybersecurity sector is focusing too much on hacks that target one car, and they need to consider the possibility that a higher number of cars being hacked at the same time could lead to mayhem.

“With cars, one of the worrying things is that currently there is effectively one central computing system, and a lot runs through it. You don’t necessarily have separate systems to run your car and run your satellite radio. If you can get into one, you may be able to get into the other,” explains co-author Jesse Silverberg.

The research team ran simulations on Manhattan, and found they were able to bring all traffic to a complete freeze by randomly stalling 20% of the cars on the road at rush hour. Hacking just 10% of cars on the road would stop traffic enough to prevent emergency vehicles from moving around.

“At 20 percent, the city has been broken up into small islands, where you may be able to inch around a few blocks, but no one would be able to move across town,” says graduate research assistant David Yanni.

Researchers say that Manhattan is actually a less than ideal target for car hackers, and more damage may be done with less cars in other cities.

“Manhattan has a nice grid, and that makes traffic more efficient. Looking at cities without large grids like Atlanta, Boston, or Los Angeles, and we think hackers could do worse harm because a grid makes you more robust with redundancies to get to the same places down many different routes,” Yunker explains.

Furthermore, the study’s authors say they did not account for any outside factors, such as traffic spillover from other blocked streets or public panic, when compiling their findings. With this in mind, they say that its likely that significantly less than 20% of all cars would be needed to gridlock a city and cause a panic.

The study is published in the journal Physical Review E.

via ZeroHedge News https://ift.tt/2GEajGc Tyler Durden