Month: August 2020

Rapper 50 Cent went on the record last week to offer up his thoughts on the country’s growing cancel culture, calling it “unfair” and stating that it is “targeting straight men” who “don’t have any organizations to back them up.”

Curtis Jackson, known as “50 Cent” partook in a video interview with Variety late last week where he was asked about cancel culture in the U.S., according to The Blaze. Jackson “lamented the impact cancel culture has had on the lives of so many people who have worked hard to get where they are,” according to the write-up.

When asked if he was ever worried about saying the wrong thing, Jackson responded that he didn’t think he could be cancelled because “hip-hop culture loves things that are damaged. It loves people who are already broken from experience.” 

He then went on to talk about how cancel culture target straight men: “I think it’s so unfair, too, to the people that are canceled. Some of them have worked all their lives to position themselves the way they are, and you’re saying that one thing you said that someone didn’t like [results in being canceled].”

He continued: “We’re talking about people who have organizations and — whatever their preferences are. You a heterosexual male? Traditional choices? You like women? If you say something about someone who chooses something different, there’s organizations set up that start sending things around to get signatures and stuff.”

“As a heterosexual male, who’s going to send things around to tap signatures based on your feelings?” he asked. “There’s no one. There’s no organization.”

“There’s certain demographics that have been conditioned, because they’ve been taken advantage of in the earlier stages. They were once inferior, now they’re superior, because we have no organization. The biggest target is just heterosexual males in general,” he concluded.

You can watch the full interview here. 

Via AlMasdarNews.com,

The Russian news portal, Top War, released video footage on Saturday of the August 28th interception of a U.S. military aircraft over the Black Sea.

“In the South, after receiving a signal about the target, which is heading to the state border, two Su-27 fighters took to the air over the neutral waters of the Black Sea. The pilots identified the target as a U.S. Air Force B-52 strategic bomber,” Top War reported.

In the nearly 30-second-long footage, the Russian Su-27 jet can be seen closely approaching the U.S. B-52 bomber, coming within 30 meters of the aforementioned aircraft, according the U.S. Air Force commander in Europe, General Jeffrey Harrigan.

The interception incident was later slammed by the U.S. Air Force chief as being ‘unsafe’, as CNN relates of the incident:

The Russia pilots crossed within 100 feet of the nose of the B-52 multiple times and also caused turbulence to the B-52 restricting its ability to maneuver, according to the statement.

“Actions like these increase the potential for midair collisions, are unnecessary, and inconsistent with good airmanship and international flight rules,” Gen. Jeff Harrigian, US Air Forces in Europe and Air Forces Africa commander said.

Meanwhile, the US Air Force released its own footage showing the same incident from the B-52 bomber’s perspective:

USAF video of an ‘unsafe and unprofessional’ intercept of a B-52 by a Russian SU-27 over the Black Sea. pic.twitter.com/k7lzNseIJJ

— Andy Netherwood (@AndyNetherwood) August 30, 2020

“While the Russian aircraft were operating in international airspace, they jeopardized the safety of flight of the aircraft involved. We expect them to operate within international standards set to ensure safety and prevent accidents,” he added.

Richard Andrew Cloward and Francis Fox Piven are two names that are largely unfamiliar to the average American, but, as Jason Brown notes, their historical relevance is being seen all over the country today as we watch civil unrest in the form of riots ensue.

As Brandon Smith detailed previously, in the mid-sixties at the height of the “social revolution” the line between democratic benevolence and outright communism became rather blurry. The Democratic Party, which controlled the presidency and both houses of Congress, was used as the springboard by social engineers to introduce a new era of welfare initiatives enacted in the name of “defending the poor”, also known as the “Great Society Programs”. These initiatives, however, were driven by far more subversive and extreme motivations, and have been expanded on by every presidency since, Republican and Democrat alike.

At Columbia University, sociologist professors Richard Cloward and Francis Fox Piven introduced a political strategy in 1966 in an article entitled ‘The Weight Of The Poor: A Strategy To End Poverty’.

This article outlined a plan that they believed would eventually lead to the total transmutation of America into a full-fledged centralized welfare state (in other words, a collectivist enclave). The spearpoint of the Cloward-Piven strategy involved nothing less than economic sabotage against the U.S.

Theoretically, according to the doctrine, a condition of overwhelming tension and strain could be engineered through the overloading of American welfare rolls, thereby smothering the entitlement program structure at the state and local level. The implosion of welfare benefits would facilitate a massive spike in poverty and desperation, creating a financial crisis that would lead to an even greater cycle of demand for a fully socialized system. This desperation would then “force” the federal government to concentrate all welfare programs under one roof, nationalize and enforce a socialist ideology, and ultimately, compact an immense level of power into the hands of a select few.

Cloward and Piven claimed that this could be accomplished at a grassroots level through community activism, and, that it would facilitate a more compassionate federal authority, however, there are numerous problems with these assertions.

The Cloward-Piven Strategy has nothing to do with grassroots activism, and accomplishes nothing tangible for the downtrodden poverty class. In fact, I would dare to say that Cloward and Piven as well as most social engineers are well aware that the concept ultimately only serves to give even more dominance to the establishment and pilfer even more freedom from the masses.

Cloward-Piven is not limited to the destabilization of state and local welfare programs. It can easily be used against federal level entitlements, and in reality, is much more effective against an entity with the proven tendency towards exponential debt spending. Though the federal government may be able to borrow fiat dollars through the Federal Reserve to prolong welfare rolls while the states cannot, a more volatile threat arises when debt monetization begins to wear down the purchasing power of the currency. Weakened purchasing power results in reduced consumer activity, less industrial growth, less GDP, and obviously, more poverty. The dollar has lost approximately 98% of its purchasing power since 1972, and after 50 years of the so-called “War on Poverty”, nearly one third of the American population now repeatedly slips under the official poverty line.

In the past decade alone, the number of people dependent on food stamps and EBT for their survival in the U.S. has doubled from 25 million people to nearly 50 million people. Those who receive some kind of payment from the government, including those on social security, disability, and veterans benefits, are approximately 100 million. Americans on social security do not consider themselves welfare recipients because they paid into the system, however, the point remains that if the federal money tap shuts down due to overwhelming participation, the checks will stop whether you paid into the system or not.

In the end, it is the Federal Government itself that is most vulnerable to the Cloward-Piven Strategy, and I believe the goal is to set fire to ALL social structures in the U.S., then assimilate them into a new globalist system.

But, as ominous as that all sounds, we need to back a little further since it was Saul Alinsky, an American community activist and political theorist in Chicago, that was the inspiration for Cloward and Piven.

Alinksy grew impatient with the new leftist activists in the 1960’s. In his book ‘Rules for Radicals,’ (which is dedicated to Lucifer), he states, “Make the enemy live up to their own book of rules” (Alinsky, 1972).

When forced to do that, human agendas inevitably fall short. This gives the opportunity to replace the capitalist ‘rule book’ with a socialist one.

The strategy was to mobilize people in poverty en/mass to overwhelm the government agencies with a flood of demands beyond these agencies’ capacity.

This creates gridlock, and the aim was to bring the system down.

Alinsky had contact with Hillary Clinton. You can see her letter to him in 1971(freebeacon.com). Clinton wrote her college thesis on ‘Alinsky and His Organizing Plan.’ Also, Barack Obama taught Alinsky 101 at the University of Chicago. How much Allinsky’s concepts actually influenced Clinton and Obama is open to debate. See David Horowitz’s book ‘Barack Obama’s Rules for Revolution: The Alinsky Model’ for more information.

Other organizations rose up, such as Acorn, with the issue of “voting rights.” These organizations received support from people like George Soros (but that is another story).

Now, let’s look at the playbook that developed from Cloward and Piven’s ideas.

These steps have been incorrectly attributed by many to Saul Alinsky. While it is true that he didn’t write them, this much is true: the actual plan is real. It was inspired by Alinsky and enumerated by Cloward and Piven.

Some people will react to this list; others will say that some of the steps are desirable goals.

Nonetheless, you can quickly see how they fit into the socialistic goals of far-left politicians and others today.

The 8 Steps to Create a Socialist State.

1. Healthcare – Control healthcare and you control the people. HAPPENING NOW

2. Poverty – Increase the Poverty level as high as possible, poor people are easier to control and will not fight back if you are providing everything for them to live. HAPPENING NOW

3. Debt – Increase the debt to an unsustainable level. That way you are able to increase taxes, and this will produce more poverty. HAPPENING NOW

4. Gun Control – Remove the ability to defend themselves from the Government. That way you are able to create a police state. HAPPENING NOW

5. Welfare – Take control of every aspect of their lives. (Food, Housing, and Income) HAPPENING NOW

6. Education – Take control of what people read and listen to us“ take control of what children learn in school. ALREADY DONE

7. Religion – Remove the belief in the God from the Government and schools. ALREADY DONE

8. Class Warfare – Divide the people into the wealthy and the poor. This will cause more discontent and it will be easier to take (Tax) the wealthy with the support of the poor. HAPPENING NOW

Right now, as Geoffrey Grider explains, steps 1-5 and 8 are being executed right now in how our government is reacting to the COVID-19 coronavirus outbreak, with steps, 6 and 7 already having been implemented since 2008. The American economy is being split into pieces right now by the combination of a $2 trillion dollar bailout with more coming, Americans under stay-at-home orders, and with more people right now on unemployment in two weeks of the coronavirus crisis than in the second year of the Great Depression of 1929.

In fact, as Geoffrey Grider explains, the Cloward-Piven plan to collapse the American economy first began under President Obama, as you will see here in this program by Glenn Beck from 2009. But for whatever reason, Obama and his minions were not able to fully implement Cloward-Piven. We thought we dodged a bullet with the election of Trump in 2016, so why are we seeing what Obama started now being thrust upon us?

This video will fully explain the Cloward-Piven strategy to you, and when you understand it, you will understand what you are watching happen right now with the coronavirus outbreak. 

Watch Part 2 here

“>Watch Part 3 here

And this does not end well… (as Brandon Smith previously noted):

If we allow ourselves to fall into the trap of making the developing crisis about a singularly unimportant thing; then the elites get exactly what they want – an angry and desperate citizenry out for the blood of a middleman and out for the blood of each other, while they sit back, relax, and wait to swoop in as our financial saviors with strings attached.

For those naïve enough to assume that Cloward-Piven is just a well intentioned activist method, it is important to understand that even if that were so, the effect of the Cloward-Piven Strategy will never achieve the goal its creators claimed to support. In my view, it is probable that they never really intended for it to produce wealth equality or an increased quality of life.

The tactic can only decrease wealth security by making all citizens equally destitute. As we have seen in numerous socialist and communist experiments over the past century, economic harmonization never creates wealth or prosperity, it only siphons wealth from one area and redistributes it to others, evaporating much of it as it is squeezed through the grinding gears of the establishment machine. Socialism, in its very essence, elevates government to the role of all-pervasive parent, and casts the citizenry down into the role of dependent sniveling infant. Even in its most righteous form, Cloward-Piven seeks to make infants of us all, whether we like it or not.

The key to achieving this is simple:

“Don’t waste a crisis”?

That is exactly what has happened in 2020, especially as it involved more that one crisis.

The COVID-19 Crisis

This pandemic has affected the lives of everyone. It has been 100 years since we have had anything like it. Tragically, people have died, and hospitals and the health care system have sought to overcome it. It has wrecked the economy, which was doing incredibly well before the pandemic. COVID-19 has been a major crisis.

George Floyd’s Death

The death of George Floyd, while in the custody of police officers in Minneapolis, in May, set off a firestorm of protests that have, in certain places, resulted in violence and destruction of property. In turn, this has resulted in issues related to police reform, law and order, etc. This, too, has been a major crisis.

Now put these two crises together, and people, both in the community and in politics, have sought to promote wholesale changes in society. Not just ‘defunding the police,’ but more radical socialist goals for society.

Remember, Black Lives Matter, which has been so easily endorsed by individuals and organizations, was founded by Marxist communists, who embraced socialist beliefs and positions.

Simply put, that there are some who are taking advantage of the current crisis’ in America to promote far-reaching socialist goals that would change society radically for years to come.

Don’t believe us, here’s an interview with Frances Fox Piven from earlier this month as she discusses why disruption must be central to protests, the thorny questions of violence and property destruction…

…this wave of protest is remarkable, and such a relief, to tell you the truth, because it really did look as though we were marching down the road to fascism.

…

It was the coming together of this [the killing of George Floyd] kind of inciting, outrageous act with the underlying conditions — and underlying conditions not only of hardship but also of gross incompetence on the part of the government in charge — which contributed to the sense that people could win something, that they could make an impact on their society.

…

Everybody seems to agree that we have to be nonviolent. I think that’s a judgment that has to be made for each movement action. I do agree that the public that we play to doesn’t like violence. But at the same time, the violent capacity of the crowd is an important way of defending its ability to exercise disruptive power.

…

This movement, Black Lives Matter, in particular, is very open to electoral activism. After the 1960s, activists drew a sharp line between protest activity and electoral activity, as if doing one meant you couldn’t do the other. What they did not keep in full view was the way in which protest activism affected electoral activism and the way in which electoral victories encouraged protest. We can see that pretty clearly now. I don’t think we’ll get a classical realignment, but I think we have to look forward to the destruction of the Republican Party…

…Certainly a revolutionary transformation, yes. Something like a revolution. It’s hard to imagine a revolution in the old style, the French style, in the United States. But a revolutionary transformation in the United States, and in European countries as well.

To be clear, this is not the majority of the protestors. The extreme left-wing is not the majority of people on the left within the Democratic Party.

As Jason Brown notes, reflecting on the current crisis in America, we must acknowledge that there is an organized effort, by bad actors, foreign and domestic, that want to see the destruction of our republic. \

We cannot be intimidated by those that want to call us conspiracy theorists, or make fun of us and our “tin foil hats.” We have to speak truth to our elected officials and remind them that they work for us, and that we are not their subjects. 

Putting an end to these revolutionary insurgents, is only possible if we recognize them for what they are. The first step to solving a problem, is acknowledging that you have one. We need to be united as a people because together we are strong. When we are divided along lines of race, gender, sexual orientation, and political ideology we are weak as we fight each other, rather than push back against those that are doing the damage to this country. We need to realize this and stop sabotaging our fellow Americans.

That is America today. We are in the valley of decision, and we have to make a decision which way we want to go as a nation to become a full-blown socialist nation or hold fast to our present system as a free enterprise nation.

Authored by Mike Shedlock via MishTalk,

Consumers continued to spend in July but it won’t last.

Real Spending vs Real Income

Personal Income and Outlays, July 2020

The charts reflect data from today’s BEA report on Personal Income and Outlays, July 2020.

• Personal income increased $70.5 billion (0.4 percent) in July. Disposable personal income (DPI) increased $39.9 billion (0.2 percent) and personal consumption expenditures (PCE) increased $267.6 billion (1.9 percent).
• Real DPI decreased 0.1 percent in July and Real PCE increased 1.6 percent. The PCE price index increased 0.3 percent. Excluding food and energy, the PCE price index increased 0.3 percent.

On the surface, things look ok. 

Real Disposable Personal Income (DPI) was down a mere 0.1 percent while consumer spending more than held up.

Personal Consumption Expenditures (PCE), consumer spending, rose 1.6%.

Ominous Picture

This is an ominous picture because the Congressional Covid stimulus expired on July 25. 

That’s when the last weekly stimulus check of $600 was sent. As of August 28, consumers will have missed 5 weekly checks of $600 each. 

How Many People?

The answer comes from my post yesterday Unemployment Claims are Still Extremely Elevated.

All Continued Claims

Over 27 million people missed 5 weekly checks of $600 each. 

Here’s the math: 27 million * 5 * $600 = $81 billion dollars. 

That is money consumers don’t have to pay the rent, pay mortgages, or but food.

Some of those checks went to people working part-time. Continued claims represent people not working at all.

Continued Claims

Continued claims are covered employees who worked no hours. That’s at least 14.5 million. But that total does not include gig workers, self-employed, and other workers not covered at the state level. 

My best guess is around 20 million people are solely reliant on pandemic assistance. Of them about 6 million have no money coming in at all.

14.5 million have only state benefits and that is not nearly enough to pay the bills. 

Congressional Bickering

Congressional bickering over the amount of stimulus has been ongoing for months. Forbes has the latest details as of today. 

• According to Reuters, Meadows said the $1.3 trillion bill was offered to Democrats privately.

• In their first conversation in weeks, Meadows and House Speaker Nancy Pelosi (D-Calif.) spoke for 25 minutes via phone on Thursday but did not make any progress towards reaching an agreement.

• Meadows described the call as “25 minutes of nothing,” Fox Business reported, and Pelosi said in a statement that the conversation made it clear that “the White House continues to disregard the needs of the American people.”

• Pelosi also said Thursday that Democrats were “not budging” on their latest offer.

No End in Sight to Bickering

Despite over 20 million people are severely impacted and have been for 5 weeks, there is no end in sight to the bickering.

Financial Cliff Has Started

A financial cliff is not coming up, it has already started. It will show up in the August data accompanied by a jump in evictions and repossessions.

Just a few days ago, the American business and political scene were transfixed by the unceasing stream of eyeball-poaching TikTok headlines: Oracle had joined the group of bidders. Then, Wal-Mart joined the fray. Then Wal-Mart – having apparently realized that running a Gen Z-focused, video-based social media platform might be outside its core competency – joined forces with Microsoft, becoming the newest front-runners in the race to a deal.

All this happened against a backdrop of increasing political turmoil, as TikTok’s American CEO, brought on to serve as a peacemaker to Washington, decided to quit after just 3 months on the job.

While Oracle’s rumored bid allegedly valued TikTok at $20 billion (in a mix of cash and stock), Microsoft & Wal-Mart were reportedly willing to pay $30 billion. The bids were supposed to have been submitted – with some last-minute players (including a group led by Centricus Asset Management Ltd. reportedly did some sniffing around) reportedly opting against making an offer (another investment group from Silicon Valley that included General Atlantic partners and some other early ByteDance investors also ended up on the list of also-rans) – by the end of the week. TikTok was supposed to have picked an offer to move forward – according to at least one report – within 48 hours.

That was three days ago.

Now, instead of a deal, it looks like they’re facing another roadblock. And with it, the latest – but not the first – hint that Beijing isn’t planning on letting President Trump walk away from this without trying to hinder his chances of reelection in the fall.

Because while the West was focused on all this deal news, the world apparently failed to notice an announcement published on the Ministry of Commerce’s website late Friday. A set of new export controls had been adopted, and the list included AI interface technologies such as speech and text recognition, as well as those that analyze data to make personalized content recommendations. Both of these – but particularly the second – are critical components of TikTok’s content-recommendation machine, widely credited with driving the app’s global popularity.

Though China’s typical ministry spokespeople wouldn’t comment on the new rules, a few CCP functionaries were apparently willing to explain the situation to Bloomberg in an “off the record” chat. According to them, Beijing isn’t trying to scuttle the sale; it’s merely trying to delay it until after the election to force President Trump to either make good on his threat to ban the app (which, keep in mind, has already been banned in India, previously one of its most popular markets), or balk and risk another embarrassing U-turn that could diminish his “tough on China” reputation.

The move, we imagine, will be considerably vexing for President Trump, who has labeled TikTok a national security threat due to Chinese laws requiring domestic companies to cooperate with Chinese state intelligence services. The company is also being investigated by American regulators for purported abuses tied to the personal data of minors (a huge portion of the app’s user base).

Barring TikTok carries another political risk: it would also bolster liberal conspiracy theorist’ claims that the president secretly blames the app and its cadre of young, politically engaged, users for the poor turnout at his Tulsa rally.

It could also potentially hurt his approval among younger voters, a large, if politically unmotivated, section of the population (you can ignore all those media reports about how engaged Gen Z is – all the available data shows they don’t vote).

On Aug. 15, President Trump issued a second executive order extending the deadline for ByteDance to sell or spin off its US operations for TikTok.

“There is credible evidence that leads me to believe that ByteDance…might take action that threatens to impair the national security of the United States,” Trump said in his order, issued Friday.

The new longer deadline was designed to increase the odds of TikTok making a deal before US tech giants like Apple and Google are forced to remove it from their app stores. TikTok is also suing the Trump Administration over the ban in the US courts (how convenient that they even have the option).

At this point, the most advantageous outcome for President Trump would be if the US courts shoot down his executive order. They have challenged his claims of national security before when it came to immigration.

Here’s the original Chinese-language order, for anybody interested.

20200828200911003 by Zerohedge on Scribd

Authored by Adam Taggart via PeakProsperity.com,

In a year that has experienced a global pandemic, Depression-level job losses, a bevy of large-scale natural disasters from wildfires to Cat 4 hurricanes to derechos, the #1 current concern we’re now hearing from our readers isn’t any of these.

Instead, it’s the danger of social unrest breaking out in their local community.

Anyone with eyes can see that the mercury is rising across America. The riots that follow the deaths of folks like George Floyd and now Jacob Blake, the current violence in Kenosha, Seattle’s lawless autonomous zone, the movement to ‘defund the police’, the anger behind the surge of ‘cancel culture’ — the nation’s social fabric is suddenly stretched taut and starting to tear at the seams.

Is it any surprise that gun sales are up 72%(!) vs last year, with first-time buyers driving a material percentage of that increase:

According to a report by the Washington Post, the National Sports Shooting Foundation says that first-time gun buyers played a heavy role in the increase.  Women and black Americans have also shown interest in arming themselves this year.

“Nearly 5 million Americans purchased a firearm for the very first time in 2020. NSSF surveyed firearm retailers which reported that 40% of sales were conducted to purchasers who have never previously owned a firearm,” the organization said in its analysis, which tracked background checks associated with the sale of a firearm reported by the FBI’s National Instant Background Check System.

“This is a tectonic shift in the firearm and ammunition industry marketplace and complete transformation of today’s gun-owning community,” said Lawrence G. Keane, a senior vice president at the foundation. “These first-time buyers represent a group of people who, until now, were agnostic regarding firearm ownership. That’s rapidly changing…

(Source)

This rise in public ire is something we’ve been warning of for years here at PeakProsperity.com. While there are many serious injustices that exist in today’s society, we believe the root cause for the majority of them lies in the misguided and frequently immoral policies perpetrated by the Federal Reserve and Congress — policies that reward the already-rich at the expense of the general public.

2020 has revealed this truth clearly in the response to the covid-19 pandemic. With the $5+ trillion unleashed between the monetary and fiscal “rescue” stimulus efforts, the battle cry from our “leaders” has been: Defend the rich! 

Despite an unprecedented decline in economic activity, asset prices have more than recovered their losses and many are now back at all-time-highs in what has been the shortest-lived bear market history:

We have been referring to these detrimental policies as the Leave No Billionaire Behind (#LNBB) program, as they’ve resulted in a massive boom for the uber-wealthy, while the rest of America has lost tens of millions of jobs and received meager to no assistance.

To get a sense of the gargantuan disparity between the haves and the have-nots, watch this 2-minute video:

And these policies aren’t going away. In fact, as Fed Chairman Jerome Powell stated yesterday, our leaders are doubling- and tripling-down on them.

In my recent interview with former Fed insider Danielle DiMartino-Booth, she interprets Powell’s comments yesterday as nothing less than a public commitment to “do even more” of what the Fed has been doing since 2009.

So if you think creating a zombie economy that enriches the elites while screwing the rest of us has been bad, boy, you ain’t seen nothin’ yet…

This is why my fellow co-founder Chris Martenson and I share this quote by Plutarch so often. If we continue the status quo trajectory, history is extremely clear on what will follow:

There is a line of intolerance that, once crossed, will turn the desperate masses against the small few benefitting so vastly from today’s system.

Skeptical it could happen? History begs to differ. Its list of social revolutions, uprisings and rebellions is so long it makes your head spin. Even the number that have happened just within the past decade is staggeringly large

And with an upcoming US Presidential election as divisive as this one? Not only will a large part of America be angry at the outcome, whomever wins, imagine what would happen should the results be contested in a protracted dispute (as has already been hinted at by both parties)? It would be the equivalent of tossing a grenade into the already-overstuffed powder keg.

So, are there steps you can today to reduce your vulnerability should unrest and the threat of violence/looting come to your community?

The answer is fortunately: yes.

In Part 2: Protecting Yourself, Your Loved Ones, Your Home & Your Money From Social Unrest, we’ve compiled the most effective, practical actions and best practices for you to consider taking now to safeguard your loved ones, your home, and your wealth from “mob threat”.

If you’re as concerned about social unrest as many of our readers, you need to assess your biggest areas of vulnerability and actively decide which are worth taking action on today.

Because only those preparations you’ve already put in place are the ones available once crisis hits.

Click here to read Part 2 of this report (free executive summary, enrollment required for full access).

Yesterday, we published a collection of some of the most striking, outlandish and shocking market charts we have seen in recent weeks, and while we touched on various issues including the collapse in market breadth, Apple’s imminent overtake of the entire Russell 2000, the historic “growth vs value” decoupling, the record overvaluation of the tech sector vs the collapse in “value”, the fulcrum point was undoubtedly the bizarre moves in the VIX in general, and single name call activity of several giga-cap stocks in particular.

Perhaps of all the charts, one of the most curious observations was the recent meltup in the VIX, and especially the Nasdaq Vol index, which last week was tracking the Nasdaq almost tick for tick, a paradox when considering that the Nasdaq just hit all time highs virtually every day which should depress vol. What was behind this unprecedented inversion of one of the market’s most fundamental correlations?

It wasn’t just the Nasdaq of course. On Wednesday and Thursday, the VIX was more than 5% higher each day, with the S&P 500 up both of those days. How rare is this? Very. According to Larry MacDonald, there were just ten days in the last decade with the S&P up 1% with the VIX closing higher. Furthermore, this is especially rare with the market at all-time highs, and as Goldman showed, the last time the VIX was this high at an all time market high was in March 2000, just before the dot com crash.

Needless to say, in a healthy bull market at its best levels, the VIX should be in the low teens, not the lows 20s as shown in the chart above. In fact, as we showed previously, the correlation between volatility and equities was at the highest since January 2018, just days before the Volmageddon event of Feb 2018.

For those scratching their heads, here is an explanation from arguably the most important market maker in the world, Citadel, which just so happens to be at the nexus of institutional and retail orderflow, and “occasionally” just happens to frontrun one or both as a recent settlement with FINRA revealed. So without further ado, here’s why the market went nuts last week, courtesy of the Bear Traps Report:

Over the past few weeks, there has been a massive buyer in the market of Technology upside calls and call spreads across a basket of names including ADBE, AMZN, FB, CRM, MSFT, GOOGL, and NFLX. Over $1 billion of premium was spent and upwards of $20 billion in notional through strike – this is arguably some of the largest single stock-flow we’ve seen in years.

“The average daily options contracts traded in NDX stocks to rise from ~4mm/day average in April to ~5.5mm/day average in August (a 38% jump in volume). 

Given this group of 7 stocks accounts for a ~40% weighting in the NDX, the outsized volatility buying in the single names is having an impact at the Index level.  So why are Vols moving Wednesday and Thursday when this call buying has been taking place for weeks?  Yesterday CRM, one of the names we have seen outsized flow, rallied 26% on earnings – a less than ideal outcome for those short volatility from all the call buying.

As the street got trapped being short vol, other names in the basket saw 3-4 standard deviation moves higher as well – on Wednesday FB rallied 8% (a 3 standard deviation move), NFLX rallied 11% (a 4 standard deviation move), and ADBE rallied 9% (a 3 standard deviation move). 

The most natural place to hedge being short single name Tech volatility is through buying NDX volatility.  As such, there has been a flood of NDX volatility buyers with NDX vols up about 4 vol points in 2 trading days. And if NDX volatility is going up, SPX volatility/VIX will eventually go up too.”

And there you have it: another squeeze, if this time it was of bulls/vol shorts in a handful of tech names who were forced to cover, sending vol surging which due to the exploding gamma discussed yesterday led to even more buying of the tech index, a move further reinforced by pair trade buying of index vol to hedge single name index vol shorting. Susquehanna derivatives strategist Chris Murphy summarized it best: “We are seeing more ‘upside panic’.”

What is perhaps scariest is that there is nothing on the immediate horizon that suggests this dynamic will end any time soon.

Authored by Ivan Pentchoukov  via The Epoch Times,

An Iowa judge ordered a local county auditor to invalidate 50,000 absentee ballot requests, agreeing with a Trump campaign argument that a local elections commissioner broke the law by pre-filling the applications with voters’ personal information.

Judge Ian Thornhill ordered Linn County Auditor Joel Miller (D) to notify the affected voters in writing that their absentee ballot requests cannot be processed because they should not have been pre-filled with their personal information. The impacted voters would have to fill out new requests or vote in person on Election Day. Miller said he would comply with the order and send new blank forms to the voters in September.

The Trump campaign filed similar challenges to other counties in Iowa.

The Democrats and Republicans are waging an extensive legal battle across the nation that will shape the rules of the 2020 election. Democratic presidential nominee Joe Biden has said that his campaign has retained more than 600 lawyers for the effort.

Democrats called Thornhill’s decision an act of voter suppression. Republicans said the ruling would enhance voting security and hold a “rogue auditor” accountable.

Miller in July sent 140,000 absentee ballot request forms to voters pre-filled with their personal information, including their names, dates of birth, and voter identification numbers. Miller has said his intention was to make it easier to vote amid the pandemic.

The judge ruled that Miller’s move violated an order from Iowa Secretary of State Paul Pate, who told county officials in July that the absentee ballot request forms mailed to voters must be blank to ensure uniformity.

The voters signed and returned 50,000 of the forms.

The state will begin to send out absentee ballots on Oct. 5.

Absentee voting resulted in record turnout in the Iowa primary in June. Iowa is one of 16 toss-up states in the 2020 election, according to a tally maintained by Real Clear Politics.

Weeks after the primary, the state’s Republican-controlled legislature passed a law blocking county auditors from filling in voters’ four-digit voting identification numbers, which few know and are routinely left blank on the forms.

Instead, the law requires auditors to contact voters by email or mail to have them correct mistakes themselves. Supporters argued that requiring voters to fill out their forms was a step to make absentee ballots more secure.

Miller and elections commissioners in Johnson and Woodbury counties said contacting voters who leave the information blank would have been too burdensome and potentially disenfranchised people, so they mailed forms with that information already filled in. They contended that the law did not block them from doing so.

Trump’s campaign and state and national Republican Party groups filed lawsuits against the three counties, seeking to invalidate all forms returned in response to the mailings. They warned that any ballots cast in response to the mailings could be challenged later.

Thornhill’s ruling, issued after he heard arguments Thursday, is the first so far. Another hearing is set for Friday in Woodbury County, where 14,000 of the absentee ballot requests have been returned. A hearing in the Democratic stronghold of Johnson County, where thousands more have been returned, is planned for next week.

Thornhill was appointed by Democratic Gov. Chet Culver in 2009.

The secretary of state has alleged that the mailing violated a law intended to protect the personal information stored in government and corporate databases, and asked prosecutors to investigate.

It argues that Miller had no legitimate purpose to access voters’ identification numbers and share them with a vendor that processed the mailing. Attorney general’s office spokesman Lynn Hicks said the office hasn’t decided whether to open an investigation.

Assistant Linn County attorney warned that an injunction would hurt voters who are expecting to receive absentee ballots and taxpayers who would be forced to pay for additional notifications to be sent.