Month: September 2024

Authored by Jonathan Turley,

A poll released by the University of Chicago via the Chicago Project on Security and Threats offers a chilling account of the growing radicalism in America, particularly after the second foiled assassination attempt of former president Donald Trump, the poll found that 26 million Americans believe “the use of force” is justified to keep Trump from regaining the presidency.

As discussed in my book, “The Indispensable Right: Free Speech in an Age of Rage,” we have seen an increasing level of rage rhetoric in our political system. For some, violent language can become violent action. There is a normalization that can occur as extreme actions become more acceptable to more and more citizens:

“We are living in an age of rage. It permeates every aspect of our society and politics. Rage is liberating, even addictive. It allows us to say and do things that we would ordinarily avoid, even denounce in others. Rage is often found at the farthest extreme of reason. For those who agree with the underlying message, it is righteous and passionate. For those who disagree, it is dangerous and destabilizing.”

With the unrelenting claims of President Joe Biden, Vice President Kamala Harris, and others that democracy is about to die in America, some now feel a license to commit criminal acts in the name of “saving democracy.”

It is the ultimate form of self-delusion that one saves democracy by committing political violence against those with whom you disagree.

We have seen this radicalism spread in past years from higher education into society at large.

Years ago, many of us were shocked by the conduct of University of Missouri communications professor Melissa Click who directed a mob against a student journalist covering a Black Lives Matter event. Yet, Click was hired by Gonzaga University. Since that time, we have seen a steady stream of professors joining students in shouting down, committing property damage, participating in riots, verbally attacking students, or even taking violent action in protests.

It is now common to hear inflammatory language from professors advocating “detonating white people,” denouncing police, calling for Republicans to suffer,  strangling police officers, celebrating the death of conservatives, calling for the killing of Trump supporters, supporting the murder of conservative protesters and other outrageous statements.

At the University of Rhode Island, professor Erik Loomis defended the murder of a conservative protester and said that he saw “nothing wrong” with such acts of violence.

At the University of California Santa Barbara, professors actually rallied around feminist studies associate professor Mireille Miller-Young, who physically assaulted pro-life advocates and tore down their display.  Despite pleading guilty to criminal assault, she was not fired and received overwhelming support from the students and faculty. She was later honored as a model for women advocates.

At Hunter College in New York, Professor Shellyne Rodríguez was shown trashing a pro-life display of students.

She was captured on a videotape telling the students that “you’re not educating s–t […] This is f–king propaganda. What are you going to do, like, anti-trans next? This is bulls–t. This is violent. You’re triggering my students.”

Unlike the professor, the students remained calm and respectful. One even said “sorry” to the accusation that being pro-life was triggering for her students.

Rodríguez continued to rave, stating, “No you’re not — because you can’t even have a f–king baby. So you don’t even know what that is. Get this s–t the f–k out of here.” In an Instagram post, she is then shown trashing the table.

Hunter College, however, did not consider this unhinged attack to be sufficient to terminate Rodríguez.

It was only after she later chased reporters with a machete that the college fired Rodríguez. She was then hired by another college.

Another recent example comes from the State University of New York at Albany, where sociology professor Renee Overdyke shut down a pro-life display and then resisted arrest. One student is heard screaming, “She’s a [expletive] professor.” That of course is the point.

While Democratic leaders have condemned the second assassination attempt on Trump, they have continued the unhinged rhetoric of how this may be our last election and democracy is about to die in America.

At the same time, some leaders have allied themselves with violent groups.

We have continued to follow the attacks and arrests of Antifa followers across the country, including attacks on journalists.

Some Democrats have played a dangerous game in supporting or excusing the work of Antifa, one of the most violent anti-free speech groups in the world. Former Democratic National Committee deputy chair Keith Ellison, now the Minnesota attorney general, once said Antifa would “strike fear in the heart” of Trump. This was after Antifa had been involved in numerous acts of violence and its website was banned in Germany.

Ellison’s son, Minneapolis City Council member Jeremiah Ellison, declared his allegiance to Antifa in the heat of violent protests. During a prior hearing, Democratic senators refused to clearly denounce Antifa and falsely suggested that the far right was the primary cause of recent violence. Likewise, Joe Biden has dismissed objections to Antifa as just “an idea.”

These politicians are playing a dangerous game in toying with groups like Antifa, which will not stop at threatening their opponents. Politicians like Ellison could easily find themselves the next target as groups seek to “strike fear in the heart” of the establishment.

*  *  *

Jonathan Turley is the Shapiro Professor of Public Interest Law at George Washington University. He is the author of “The Indispensable Right: Free Speech in an Age of Rage” (Simon & Schuster).

Authored by Lance Roberts via RealInvestmentAdvice.com,

Since 2020, momentum investing has generated significantly better returns than other strategies. Such is not surprising, given the massive amounts of stimulus injected into the financial system. However, Brett Arends for Marketwatch noted in 2021 that momentum investing can give you an edge. To wit:

“Its success ‘is a well-established empirical fact,’ and can be demonstrated across multiple assets and over 212 years of stock market data, argues money manager Cliff Asness and his colleagues. It is ‘the premier market anomaly,’ writes analyst Gary Antonacci. It trounces a simple ‘buy and hold’ stock market strategy going back almost 100 hundred years, estimates money manager Meb Faber.”

While momentum investing is appealing in a liquidity-driven bull market, is it always the best strategy? As noted in the “Best Way To Invest:”

The last decade has been a boon for the index ETF industry, financial applications, and media websites promoting ‘buy and hold’ investing and diversification strategies. But is the ‘best way to invest’ during a bull market also the best way to invest during a bear market? Or, do different times call for different strategies?

That is the question we will explore further.

Momentum Investing Isn’t Passive

Brett compares several ETF funds over the past five years in his discussion. To simplify our analysis, we will use the following three ETFs from 2014 to the present. (2014 is the earliest date that all three ETFs have performance data.)

• SPDR S&P 500 ETF (SPY) as the “buy and hold” proxy,

• IShares Momentum ETF (MTUM) as the “momentum” proxy; and,

• IShares Value ETF (IVE) as the “value” proxy.

For our analysis, we calculated the growth of $1 invested in each ETF from January 2014 on a nominal capital appreciation basis only.

At first blush, the obvious choice for investors was momentum when compared to the S&P 500 or value.

So, is that all there is to it?

Do you buy a “momentum” fund and forget about it?

Well, not so fast, says Brett. However, while I agree with Brett, it is for a different reason. The issue with “Momentum investing” is that it is not a passive strategy. For example, if we look at the top 10 holdings of MTUM, we can see the changes being made to the ETF as momentum changes in the market.

At the end of 2020, Danaher Corp (DHR) and Thermo Fisher (TMO) were among the top 10 holdings as the market chased healthcare-related stocks due to the pandemic. By September 2021, with the steepening yield curve and developments related to vaccines and bitcoin, Paypal (PYPL), Moderna (MRNA), and major banks dominated the top 10. By the end of 2021, PayPal was replaced by Nvidia (NVDA), Costco (COST), and accounting stocks.

Looking at the present, following the 2022 correction and subsequent rebound, the holdings have once again shifted. After a strong run in 2024, Costco has returned to the top 10, replacing Netflix (NFLX) and Microsoft (MSFT).

The outperformance in Momentum is due to the changes in holdings to capture price trends. However, if you hold SPY, the only changes over the last few years are due to the weighting in the top-10 holdings.

Again, momentum seems to be the obvious choice.

But it isn’t.

Momentum Investing Doesn’t Always Win

Brett makes a very important point about momentum investing.

Researchers say investing in so-called “momentum” stocks, is the best documented and most durable “edge” in the market.

Critically, that applies to owning individual equities in a portfolio. Not passively holding an ETF.

There is a difference.

Yes, on a passive basis since 2014, momentum has outperformed the benchmark and value indices. However, passively holding an ETF negates the value of momentum investing.

“And there is an inbuilt cautious bias to this portfolio as well, because it only holds stocks that have positive trailing returns. In a bear market you may be invested in nothing whatsoever. As Meb Faber and others have pointed out, momentum strategies can help you avoid the worst market turmoil.” – Brett Arends

Read that again.

As a strategy, momentum investing raises cash when the momentum of holdings turns negative. Such is not the case for an ETF that must always remain invested. If we break the comparative performance down into specific periods, the value of the momentum strategy gets lost.

In 2105 and 2016, momentum provided no hedge against the Fed’s “taper” and Brexit.

Similarly, in 2018, relative performance was worse than the benchmark during the Fed’s “taper tantrum.”

Holding a momentum ETF in early 2020 did little to shield you from the downturn. However, momentum benefited from the recovery fueled by trillions in monetary and fiscal policies.

During 2022, holding a momentum ETF significantly underperformed the value index.

As Brett noted, momentum investing’s value, when applied to a portfolio of individual equities, is that it can help avoid significant capital destruction during market downturns.

However, the value of the momentum strategy gets lost when applying an active strategy to a passive holding.

Choosing The Right Strategy At The Right Time

As a strategy, momentum investing works well when properly applied to a portfolio of individual securities.

One of the most interesting aspects of this portfolio though is not only that it has a lot of hard numbers backing it up, but that it is in theory accessible to any ordinary investor who can screen stocks by monthly performance.

He is correct, and it is something that we provide at SimpleVisor daily, as shown:

Momentum investing works exceptionally well during a strongly trending bull market. However, it is critical to remember that strategies change during a bear market. As shown below, market cycles tend to precede economic cycles, so investment strategies should change with both economic and market cycles.

Such will be critically important when the next bear market begins.

The Return Of Value

As Brett aptly concludes:

My biggest problem with “momentum” as an investment strategy is that you are basically abandoning any attempt to do your own fundamental analysis whatsoever. It feels to me like the stock market equivalent of “social” media, jumping on the latest crowd mania regardless of any merits. 

But maybe that’s why I should do it. If Rome is falling, and the Dark Ages are coming, shouldn’t I just give up and bet on the Vandals?”

I wouldn’t give up just yet.

The chart shows the difference in the performance of the “value vs. growth” index. (Fidelity Value Fund vs S&P 500 Index)

Notable are the periods when “value investing” outperforms.

While it may seem like the current bull market will never end, abandoning decades of investment history would be unwise. As Howard Marks once stated:

“Rule No. 1: Most things will prove to be cyclical.

Rule No. 2: Some of the most exceptional opportunities for gain and loss come when other people forget Rule No. 1.”

The realization that nothing lasts forever is crucial to long-term investing. To “buy low,” one must first “sell high.” Understanding that all things are cyclical suggests that investment strategies must also change.

The rotation from “momentum” to “value” is inevitable. It will occur against a backdrop of economic weakness and price discovery for investors quietly lulled into complacency following years of monetary interventions.

“Relative valuations are in the far tail of the historical distribution. If, as history suggests, there is any tendency for mean reversion, the expected future returns for value are elevated by almost any definition.” – Research Affiliates

The only question is whether you will be the buyer of “value” when everyone else is selling “momentum?”

After last week’s solid auction which saw stellar demand no doubt on the expectation that the Fed will soon be slashing rates, moments ago we got the results of this week’s sole coupon offering: a $13 billion reopening of 19Y-11M cusip UD8, where we learned that demand for 20Y paper was far weaker than expected.

Stopping at a high yield of 4.039%, the 20Y reopening yield was down from 4.16% in August, and even though this was the lowest 7Y yields since July 2023, it was the auction this month to still yield above 4% (thanks to the infamous 20s-30s kink, the 30Y trades at 3.96%). Notably, it also tailed the When Issued 4.019% by 2.0bps, the biggest tail since February’s catastrophic – and record – 3.3bps tail, and followed 6 consecutive stop throughs.

The demand metrics were just as ugly: the bid to cover sank to 2.51 from 2.54, the lowest since February and naturally below the six-auction average of 2.68%. 

The internals were even worse: indirects took down 65.1%, down from 71.0% last month and the lowest since the dismal February auction. And with Directs taking 16.3%, Dealers were left holding 18.6%, double last month’s 9.7% and the highest since – you guessed it – February.

Overall, this was a very ugly auction, easily the second worst 20Y sale of 2024, and the market reacted appropriately, sending the 10Y yield to session highs.

Outgoing NATO chief Jens Stoltenberg has addressed the question of the US and UK mulling allowing Ukraine to strike Russian territory with West-supplied long-range weapons. President Putin last week spelled out clearly that if this happened then Moscow and NATO would be in a state of direct war.

Stoltenberg downplayed this threat of major new escalation in a Monday interview with LBC radio, saying he “welcomed” the discussion over long-rage missiles. He separately told Foreign Policy he’s in favor of the West greenlighting long-range strikes on Russian soil.

“I welcome these developments and these decisions but its for individual allies to make the final decisions,” Stoltenberg said. “Allies have different policies on this.”

And yet strangely, he seemed to admit the potential for nuclear-armed confrontation. “So far, we haven’t seen any changes in their nuclear posture that require any changes from our side,” he said, while acknowledging that there won’t be any winners in a nuclear war.

He was pressed over the question of Russia’s reaction if the West goes ahead with this long-range escalation:

Asked about possible Russian retaliation, Stoltenberg said there were “no risk-free options in the war”.

“But I continue to believe that the biggest risk for us, for United Kingdom, for NATO, will be if President Putin wins in Ukraine,” he added.

At this moment, the Russian side is indeed ‘winning’ in terms of Putin’s stated objectives to fully control the Donbass in Ukraine’s east. Zelensky has been seeking to escalate against Russian territory out of desperation, and in hopes Moscow would be forced to pull manpower from Donetsk and redirect it to Kursk.

Stoltenberg has rejected Putin’s assertion that NATO will be a direct part of the war if long-range attacks on Russia are approved. He in a separate Foreign Policy interview stated “This is not correct when President Putin says that we will become party to the conflict.”

He attempted to explain that given NATO doesn’t consider Iran and North Korea direct parties to the conflict over their alleged military aid shipments to Moscow, neither should Russia see NATO in the same light.

Of course, what Stoltenberg is leaving out is the heart of the issue: that this would involve Western weapons directly striking Russian territory, perhaps even as far as Moscow oblast. None of this will convince Putin that somehow NATO is not a party to the conflict.

Stoltenberg emphasized Ukraine’s right to self-defense, which includes the “right to strike targets inside the territory of the aggressor [Russia].” The NATO chief laid out that he is “in favor of loosening restrictions” of Ukraine using long-range Western weapons to attack Russia.

NATO Secretary-General @jensstoltenberg says on FP Live that he is in favor of allies loosening restrictions on Ukraine’s use of Western-made long-range missiles. Watch the full interview or read the Q&A here: https://t.co/3WEPN7WMqA pic.twitter.com/Lm4xle93pG

— Foreign Policy (@ForeignPolicy) September 16, 2024

To recount, Putin anticipated these arguments. He explained last Friday, “So this is not about whether or not to allow the Ukrainian regime to strike Russia using these weapons, but of deciding whether or not NATO countries are directly involved in the military conflict or not. If such a decision is taken, it will mean nothing short of direct participation of NATO countries, the United States, European countries, in the war in Ukraine.”

The Russian leader had continued in his televised short remarks: “This would constitute their direct participation, and this, of course, changes the very essence, the very nature of the conflict. It will mean that NATO countries, the United States and European countries, are at war with Russia.” He couldn’t have been any clearer.

Two members of the Chicago Civilian Office of Police Accountability were fired at the end of last month…immediately after they complained to the Inspector General about bias against police.

Matt Haynam, deputy chief administrator for the Civilian Office of Police Accountability (COPA), responsible for investigating Chicago Police misconduct, was abruptly dismissed during a virtual meeting with COPA Chief Andrea Kersten and general counsel Robin Murphy, according to a report from Law Enforcement Today, citing the Chicago Sun Times.

Earning $163,068 annually, Haynam said he was given no explanation for his immediate termination. Within 90 minutes of the meeting, COPA employees arrived at his home to collect his city-issued car, computer, and phone.

Haynam said he received a text from supervising investigator Garrett Schaaf, who had been similarly fired. Schaaf, who earns $117,792 annually, declined to comment.

“I recently made a complaint to the [inspector general] directly and was let go today effective immediately and given no justification,” Haynam said.

“I’m being fired because she [Kersten] is retaliating. There’s not a performance issue or an issue with my skill level or technical ability, nor was I told there was. I’ve work[ed] there for seven years and been promoted four times. Yet after I make a complaint against Andrea, I’m fired without explanation? I haven’t talked to her in over a month other than of her to fire me today,” he continued.

He continued: “I could probably give you 20 people at COPA who would tell you the same thing. We have employees inside with spreadsheets tracking bias.”

“We have quality managers who have met with Andrea and said, ‘We have a real problem here.’ Is there an issue? Yes. Enough people have been blowing the whistle that someone external to COPA has to either clear what’s going on and say investigations are sound or they’re not,” he said. 

The Law Enforcement Today report says Chicago Police Superintendent Larry Snelling has criticized COPA investigations as unfair and “outcome-based,” with Haynam agreeing and expressing distrust in the process.

However, COPA’s first deputy chief administrator, Ephraim Eaddy, refuted claims of anti-police bias, pointing out that only 14 percent of 2023 investigations resulted in sustained misconduct findings. Eaddy emphasized COPA’s commitment to its responsibility in investigating complaints and serving the city.

Earlier this year, the Fraternal Order of Police (FOP) sued COPA Chief Andrea Kersten and her aides, accusing them of biased investigations and excessively harsh discipline on officers. FOP President John Catanzara argued that COPA had strayed from its mission, pushing a far-left agenda and unfairly targeting police officers.

By Todd Maiden of FreightWaves

August data from Cass Information Systems showed the freight market continues to trudge along what is expected to be a trough. Both shipments and freight spend stepped lower from year-ago levels.

Shipments captured by the Cass Freight Index fell 1.9% year over year in August, following a 1.1% y/y decline in July. The August result came in ahead of a projected decline of 3%.

“These were the smallest declines in 18 months as goods demand continues to grow slowly, and slowing capacity additions reduce the pressure on for-hire shipments,” the Monday report stated.

The volume dataset improved 1% seasonally adjusted from July, a second consecutive monthly increase (up 3.1% seasonally adjusted in July) but remained 12.3% lower than the 2022 level.

The shipments index is expected to be down 3% y/y in September and off 3% to 4% for all of 2024 after a 5.5% decline last year.

The update from Cass appears to be in line with comments from trucking heads at an investor conference held last week. Some of the nation’s largest truckload carriers like Schneider National and Werner Enterprises said the industry is still coming out of a protracted recession and that there has been no market inflection, just normal seasonal demand trends.

The expenditures index, which logs total freight spend, fell 9% y/y and 1.3% (seasonally adjusted) from July. The index was off 6.2% y/y last month, which was the smallest decline since the beginning of 2023. Compared to two years ago, total freight spend was off nearly 32% in the month.

The expenditures index was down 16% y/y in the first half of the year and is expected to be off 11% to 12% for the full year as the declines have eased.

Excluding the impact that lower shipments had on the expenditures data, “inferred freight rates” were down 7% y/y and 2% sequentially in August to “a new cycle low.” However, a 3% decline in diesel fuel prices from July to August (down 16% y/y) weighed on inferred rates during the month.

Inferred rates are expected to decline 8% y/y this year after a 14% decline last year.

The Cass Truckload Linehaul Index, which records core linehaul rates excluding changes in fuel and accessorial surcharges, declined 3.3% y/y in August and 0.6% sequentially. This was the fourth consecutive sequential decline as “overcapacity keeps bids highly competitive.”

The TL linehaul index includes both spot and contract freight.

“With spot rates steady over the past year, downward pressure on the larger contract market is lessening, but recent slight increases in spot rates are not yet enough to turn contract rates higher,” the report said.

Data used in the indexes is derived from freight bills paid by Cass, a provider of payment management solutions. Cass processes $38 billion in freight payables annually on behalf of customers.

 

For Wall Street analysts banking on new AI-powered iPhones to spark an upgrade supercycle this fall, growing evidence already points to underwhelming demand for these smartphones. 

The latest development comes from China, the world’s largest smartphone market, where online retailers have already offered price discounts on the new iPhone 16 series. 

South China Morning Post offered more insight into iPhone discounts at major Chinese online retailers that only suggest lackluster demand: 

PDD Holdings’ Pinduoduo, one of the country’s most popular e-commerce platforms, has started selling the iPhone 16 Plus with 512 gigabytes of storage for 8,999 yuan (US$1,268), a 10 per cent discount from the official price of 9,999 yuan. The 128GB iPhone 16 is being sold at an even steeper 11 per cent discount.

Both Pinduoduo and Alibaba Group Holding’s’ Taobao marketplace have slapped a 4 per cent discount on the 256GB version of the high-end iPhone 16 Pro Max, lowering the price by 400 yuan to 9,599 yuan. Alibaba’s Tmall shopping platform also offers buyers the option to pay for a new Apple handset in 24 instalments without interest charges.

The discounts in China came days after TF International Securities analyst Kuo Ming-chi’s US pre-order analysis report on Sunday, which found less demand for the iPhone 16 Pro and iPhone 16 Pro Max and, inversely, more demand for base models. 

“Some consumers also questioned whether Apple’s promise to roll out the AI function in Chinese-speaking regions will cover the mainland, where generative AI technology is heavily regulated,” SCMP wrote in a separate note, adding, “Globally, Apple’s built-in AI is powered in part by OpenAI’s GPT models, which have not been made available in China.” 

“The absence of AI in China is akin to cutting one of Apple’s arms,” one blogger said on Weibo. One popular comment read, “With the biggest selling point unavailable, shouldn’t you charge us half the price?”

Meanwhile, Huawei’s share of smartphone sales in China continues to expand. Last quarter, the market tracker IDC showed that the Chinese tech giant recorded a 50% market share. Other brands, including Vivo and Xiaomi, also outpaced Apple, which fell to sixth place among handset makers in the country. 

Maybe Wedbush analyst Dan Ives needs to rethink his whole “AI is on the doorstep” and the grand iPhone upgrade supercycle that is supposedly ahead.

By Michael Every of Rabobank

Ahead of the Fed meeting, our US strategist Philip Marey has just put out an FOMC preview titled ‘Casino’ that acts as reminder that his ahead-of-the-market call of three Fed 25bps cuts this year starting in September still holds – but there is now a substantial risk of a 50bp move this week. The market has been pricing the Fed as close to a 50-50 red-black roulette wheel spin. Yet his title is even better: because those who use analysis to predict the game’s outcome get their hands broken with a hammer.

The Fed want inflation back at 2%. On a headline basis, it’s heading there. However, this is led by deflation in and from China, which the Fed has nothing to do with, and which is prompting tariffs globally. It’s also due to a collapse in global commodities pricing in a global downturn the Fed say isn’t coming. Core inflation is 3.2% y-o-y and not heading lower. On an ultra-core basis, it’s also over target, edging higher, held up by housing. There, rate cuts mean lower mortgage rates, so more housing demand, but not more supply. That means inflation, not deflation, regardless of what White House economic advisor and former Fed Deputy Chair Brainard just said.  

The Fed want to see unemployment stay low – if it’s meaningful given recent demographic changes they apparently knew nothing about. Yes, the last payrolls revision shifted the dynamic there significantly: but again, did the Fed not know this was coming when some had been mentioning it for months in advance? Literally weeks ago, the Fed were unconcerned, now they worry: yet weekly initial jobless claims data are unchanged.

Nor are the Fed using their endless speaking opportunities to underline that financial conditions are not tight, but loose. Mortgage rates are moving lower before the Fed does. Stocks are at record highs. Credit and junk bond spreads are near lows. The two-year yield is so far below the Fed Funds rate that we almost don’t need to bother having a Fed Funds rate, which is a discussion that gets your hand broken by different people.

You count all those cards, and it suggests a near 50-50 call between 25 and 50bps as the first Fed cut. Even so, logic and consistency say the larger move, only seen at the start of past economic shocks, would suggest the Fed fears something they aren’t telling us. As Philip puts it, “if the economy has become fragile, a 50bps cut could even undermine confidence and make it even more fragile.” Indeed, I put it to you that to go 50bps one must contend either the Fed didn’t know what they were doing recently; or don’t know what they are doing now; or both.

Regardless, large men in suits and sunglasses are politely inviting us for a chat about the Fed in a room with no windows. Fed whisperers used as channels for unofficial communication when their constant prattling, dots, and plots still don’t get the market to ‘efficiently price’ what they want, have one message: 50bps. Nick Timiraos; Greg Ip; John Hilsenrath; former Fed members; oddly, even the Financial Times editorial board are all saying it. How have the verbose Fed gotten to the point where this full court press is required, or is this all just coincidental?  

Worse, three Democratic senators, led by Elizabeth Warren, are openly calling for the Fed to go 75bps: these are the same people outraged at the idea that Trump should have a say in setting interest rates. Is that a framing device to make a 50bp move look measured, or is that just a conspiratorial thinking? It’s not like there isn’t a swirl of such thinking around right now, and for very good reasons, even if, again, it risks getting one’s hand broken even typing it.

Were we to get 50bp –which I repeat Philip sees as a tail risk, not a given– would the market see it as nifty (catching up to the curve), shifty (what am I missing?), grifty (who’s on the take?), or Swift-y (political)?

Yet, believe it or not, there are other high-stakes tables being played at elsewhere that matter:

• JPY is trading just above 140 after dipping below it during the Japanese holiday yesterday. The wild ride in the yen carry trade unwind likely isn’t over if the Fed as we hear “50!” and “No, 75!”
• The US has proposed closing the de minimis loophole allowing packages worth less than $800 to enter the US customs free, which is seen as targeting Chinese fast-fashion firms Temu and Shein. Thailand just made a similar move to protect its industries from postal Chinese imports.
• The second assassination attempt on Trump already seems to have a shorter media half-life than the first. Trump tweeted “0-2”, an improvement over “I HATE TAYLOR SWFIT!” The Babylon Bee tweeted: “Kamala safe and in stable condition after attempted interview.” Sadly, this all looks like the ‘DM = EM’ process in motion.
• Canada introduced 30-year mortgages for first-time and new-home buyers, and also allowed mortgage insurance on homes up to C$1.5m (up from C$1m), so buyers can bid on more expensive housing. Guess what this will mean? More expensive housing – demand goes up while supply remains unchanged; and more debt – especially alongside “RATE CUTS!” Can you tell there’s an election soon? And can you tell most politicians don’t have any new political-economy ideas yet?
• Germany reinstituted border controls as its coalition government tries to cap a surge in votes for the far right AfD and old-school far left BSW ahead of another state election this month; yet it also just signed an agreement with Kenya to allow 250,000 jobseekers to enter. That’s as VW may reportedly force through plant closures and 15,000 job cuts this year.
• EU commissioner Thierry Breton, who had threatened Elon Musk, resigned while alleging horse-trading over who gets what roles: what can one retort other than, “I am shocked, shocked that gambling is going on here!” Meanwhile a spat brews over the appointment of another commissioner alleged to have spied for former-communist Yugoslavia.
• Iran-backed Houthis fired what they claim was a hypersonic missile at Israel’s international airport, evading its defences. No harm was done, but the Houthis are getting better weapons, and a larger Israeli response seems inevitable. Israel’s war cabinet also set the goal of returning its displaced population to the north, into which Iran-backed Hezbollah fires almost daily from Lebanon. The US envoy to the region just stated attacking Hezbollah won’t allow displaced Israelis to return home, implying the key is a Hamas hostage deal – which means Hamas have an incentive not to make one to escalate the regional conflict. Meanwhile, rumours swirl PM Netanyahu is to fire defence minister Gallant for the second time (the first reversed after street protests, the interjection of the PM’s wife perhaps stymieing it this time). If it happens, there’s a higher probability of an attack on Lebanon including a ground operation. That would risk the regional conflagration simmering since October 7, 2023. But will it wait until after 5 November?
• The US has underlined its concerns Russia is helping Iran with nuclear technology in exchange for Tehran’s aid in fighting Ukraine. That’s as the new “reformist” Iranian president says his country “didn’t want to enrich uranium at near-weapons grade levels but had been forced to by the US withdrawal from its nuclear deal with world powers.” What can one retort other than, “I am shocked, shocked that nuclear weapons are going on here!”
• Russia announced it will expand its armed forces by 180,000 to a standing army of 1.5 million active servicemen (nearly double that including support staff). The EU feels like it has 180 people thinking how it can thrive in this realpolitik world, and 150 million rejecting their work.

“That’s the truth about Las Vegas. We’re the only winners. The players don’t stand a chance.” – Sam ‘Ace’ Rothstein, Casino

With Donald Trump now the target of two assassination attempts in two months, a new whistleblower report released by Senator Josh Hawley (R-MO) has unveiled a series of alarming security lapses by the U.S. Secret Service (USSS) and other federal agencies during the attempt at a rally in Butler, Pennsylvania, on July 13, 2024.

The report, based on information provided by multiple whistleblowers, highlights a pattern of incompetence, mismanagement, and inadequate preparation by the agencies responsible for safeguarding one of the most high-profile figures in American politics.

The report reveals that systemic failures, poor decision-making, and a lack of proper resource allocation within the Secret Service contributed to what is being described as a near-catastrophic breach of presidential security. These findings have sparked a call for urgent oversight and reform of the agency, raising serious questions about its ability to protect national leaders.

Gaps in Security Protocols and Poor Decision-Making

Among the most critical allegations in the whistleblower report is the Secret Service’s decision not to conduct a standard evaluation of the rally site. The Counter Surveillance Division, tasked with identifying potential threats, was notably absent during the event. This failure was compounded by the fact that the Secret Service reportedly declined multiple offers from local law enforcement to employ drone surveillance technology at the rally. The decision was particularly consequential, given that the would-be assassin himself used a drone to conduct surveillance of the rally site hours before launching his attack.

In a striking lapse, law enforcement personnel abandoned a rooftop surveillance position due to hot weather conditions. This rooftop was subsequently used by the shooter to fire shots during the rally, nearly succeeding in his assassination attempt. The report suggests that a significant security breakdown occurred because of a lack of counter sniper coverage and the absence of a coordinated response.

What’s more, the lead Secret Service agent responsible for site security during the rally was also flagged for a history of incompetence. This agent, who had previously been cited for failing to follow established security protocols, was nonetheless placed in charge of protecting the former president. The report raises questions about how and why this individual was entrusted with such a critical role.

Whistleblowers told me that the lead site agent at the Butler rally was someone who wasn’t trusted by other Secret Service agents and didn’t know what she was doing.

Why are these people running security for a former President and a major party nominee? pic.twitter.com/FPxPGA8yGM

— Josh Hawley (@HawleyMO) September 16, 2024

Resource Denial and Inadequate Training

According to whistleblowers, agents on the ground were discouraged from requesting additional security resources, with explicit instructions that such requests would be denied. This led to a situation where those responsible for protecting the former president were left under-resourced and vulnerable. The rally itself was reportedly covered by Department of Homeland Security (DHS) agents who were reassigned from other duties, such as child exploitation cases, with only a two-hour webinar as preparation. Such minimal training, the report claims, was grossly inadequate for the complexities of protecting a high-profile target like Trump.

The whistleblowers further allege that the Secret Service’s Counter Surveillance Division faced significant cuts in both funding and personnel. These reductions were purportedly directed by Acting Director Rowe, who has yet to respond publicly to these claims. These resource cuts, whistleblowers argue, directly impacted the agency’s ability to maintain the level of vigilance needed to thwart potential threats.

Internal Concerns and Allegations of Retaliation

The report also raises concerns about internal culture and leadership within the Secret Service, suggesting that agents who voiced concerns over security protocols were either ignored or faced retaliation. Some whistleblowers allege that they were subject to pressure or threatened with career repercussions if they raised alarms about inadequate security measures. This internal atmosphere, as depicted in the report, could have contributed to a chilling effect, discouraging agents from advocating for necessary precautions.

Following the attempted assassination, several high-level Secret Service officials were reportedly “encouraged to retire,” a move viewed by critics as an attempt to avoid deeper scrutiny and congressional oversight. This, the report suggests, points to a culture of evasion rather than accountability within the agency.

The whistleblower report highlights the slow response of executive agencies to the inquiries made by lawmakers. Senator Hawley’s office noted that while they had asked for clarifications from both the Secret Service and DHS, the responses have been delayed and lacking in detail. Notably, none of the agencies have outright denied the whistleblower allegations, which has only fueled further concern over the veracity of the claims.

Hawley emphasized the need for a comprehensive investigation and reforms, stating, “These failures expose significant vulnerabilities in our nation’s security apparatus that cannot be ignored. It is imperative that we hold those responsible to account and implement immediate changes to prevent such a failure from happening again.”

Several questions remain unanswered. For instance, why were critical security measures, such as rooftop surveillance and counter-sniper coverage, not enforced? Who within the Secret Service or DHS was responsible for denying requests for additional security resources? And what was the motive behind the assassination attempt, given the assassin’s use of encrypted communications?

Moreover, the report points to broader implications for U.S. security policy. In the wake of the assassination attempt, there is growing pressure on both Congress and the Biden administration to undertake sweeping reforms of the Secret Service. This would likely include revisiting funding levels, personnel training, and perhaps most critically, ensuring a culture of accountability within the agency.

The Biden administration has so far not commented directly on the findings of the whistleblower report. However, lawmakers from both parties are expected to press for further hearings and investigations into the matter.

A Call for Whistleblower Protections and Further Reforms

Hawley has promised protections for any new whistleblowers who provide additional information on the Secret Service’s failures. “We cannot afford to sweep these issues under the rug,” he said. “The American people deserve a transparent and accountable government, and that starts with a thorough investigation into these alarming revelations.”

Authored by Jesse Coghlan via CoinTelegraph.com,

Donald Trump didn’t end up talking about World Liberty Financial — his family’s new crypto platform — during a so-called launch event on X, but the team eventually shared information about the project’s token.

Former President Trump was interviewed by crypto influencer Farokh Sarmad in a Sept. 16 X Spaces, his first public appearance since an apparent assassination attempt on Sept. 15, which he spoke about to open the livestream.

Despite Trump billing the livestream as a “State of Crypto address,” it took about 16 minutes for him to mention the word, saying: “We’re going to make our country greater than ever before, and you’re going to be happy, and you’re going to love your crypto.”

While Trump spoke for around 45 minutes, he didn’t share any information about World Liberty Financial, details of which have already been sparse.

Join me live from Mar-A-Lago at 8:00PM Eastern, tonight on X Spaces. Set a reminder and be sure to tune in! https://t.co/MXTu3hxVFP

— Donald J. Trump (@realDonaldTrump) September 16, 2024

It wasn’t until over two hours into the livestream that one of the project’s leaders, Zak Folkman, shared that “there will be a token.”

Reading from a pre-written statement, Folkman said it was planning to sell non-transferrable WLFI tokens, which “are pure governance tokens, only providing the right to make proposals and vote on matters related to the platform.”

He added that the sale of WLFI tokens to US persons would only be available to accredited investors.

“Although we don’t consider WLFI to be a security, in the light of regulatory uncertainty surrounding tokens and token sales in general in the United States, we’ve decided that it’s prudent to limit the token sales to certain persons who would be eligible to participate in transactions that are exempt from registration under the US federal securities law,” Folkman said.

“So that means that US persons may only participate in a potential token sale if they have been reasonably verified as accredited investors.”

He added a potential token sale to non-US persons would similarly be limited by “applicable restrictions.”

Folkman and fellow project leader Chase Herro, along with Eric and Donald Trump Jr., have touted how the platform would remove barriers that exist in the traditional finance system.

Folkman did not share what WLFI’s total supply would be but said it would have an “incredibly fair token distribution” with “approximately 63%” set aside for sale to the public.

He added that there had been “no pre-sales” or “early buy-ins with discounted allocation” for venture capitalists. However, 20% of the tokens were allocated to the platform’s team and advisers, with the remaining roughly 17% for user rewards.

An earlier reported white paper draft suggested that 70% of the WLFI token supply would be held aside for the team, with the remainder allocated for public sale.

No details were shared on the World Liberty Finance platform itself. Reports said it will be a decentralized finance (DeFi) platform for borrowing and lending similar to Dough Finance, which was hacked for $1.8 million in July.

The white paper draft also mentioned credit systems for borrowing and lending built on the popular DeFi app Aave, which World Liberty Financial said it is “working with.” The project has also said it wants to drive “the mass adoption of stablecoins.”

Trump — who in 2019 said that cryptocurrency’s values are “based on thin air” — has changed his tune and has sold four non-fungible token (NFT) collections, accepted crypto for his campaign contributions and cozied up to the crypto industry, promising to be a “crypto president.”