Author: admin

Between an economy-wrecking pandemic and a blistering crime wave driven by race riots and a disbanded anti-crime unit, New York City residents are switching to Pace Picante and fleeing the metropolis in droves.

That, of course, is nothing new if you’re been following along. But if you need yet another data point, NYC moving companies are so busy they’re having to turn down business, according to DNYUZ.

While the moving industry is fractured among numerous small business owners, and official statistics are tough to come by, one thing is clear: From professionals who are downsizing following a job loss, to students moving back in with their parents, to families fleeing the city for the suburbs, New Yorkers are changing their addresses in droves.

According to FlatRate Moving, the number of moves it has done has increased more than 46 percent between March 15 and August 15, compared with the same period last year. The number of those moving outside of New York City is up 50 percent — including a nearly 232 percent increase to Dutchess County and 116 percent increase to Ulster County in the Hudson Valley. –DNYUZ

“It felt like move-out day on a college campus,” said former NYC resident, Bobby DelGreco, who moved out of his apartment of nine years in Stuyvesant Town, located in East Manhattan. DelGreco is now living in a long-term Airbnb in Los Angeles, so we assume he’ll be moving again shortly.

“All the doors were propped open, and there were moving trucks and furniture everywhere,” he added.

Matt Jahn, owner of Brooklyn-based Metropolis Moving, told DNYUZ that he’s been flooded with so many customers that he’s had to reject new business. “We are turning people away because we just don’t have the capacity,” he said, adding “Normally, in a given summer, we spend a bunch on advertising. But we cut it this year because we couldn’t afford it. And we have still had amazing demand.”

Moving trucks everywhere in our #Manhattan neighborhoods. Let’s work together to bring our borough back. Stay tuned. #NYC #2021 pic.twitter.com/kREnR1eFap

— Elizabeth Caputo (@elizabethcaputo) June 26, 2020

That said, things were looking dicey in March, as the COVID-19 lockdown meant a sharp dropoff in business for moving companies. “Right in the beginning, we weren’t sure if we were allowed to work, and a lot of businesses were in limbo,” according to Daniel Norber, owner of West Village-based Imperial Movers. “Everyone was wondering if they should close shop.”

Then, Gov. Andrew Cuomo announced that moving companies were considered an essential service, and the phones began to blow up.

“Within 30 minutes of the announcement I got a flood of calls,” said Jahn of Metropolis Moving, who added that things haven’t slowed down since.

“The first day we could move, we left,” said Jaime Welsh-Rajchel. In mid-March, Dr. Welsh-Rajchel, a dentist, and her young son, Henry, took refuge from the city with family in Pennsylvania, while her husband, Todd Rajchel, a dental anesthesiologist at Wyckoff Heights Medical Center in Bushwick, stayed behind to spend the height of the pandemic intubating Covid patients.

Dr. Rajchel has since accepted a position at the School of Dentistry at Creighton University in Omaha, and his wife, Dr. Welsh-Rajchel, returned to Brooklyn just long enough to help move their items. “Todd was saying we need a five-year period to decompress from this experience before we can come back to New York for a visit,” she said. –DNYUZ

Compounding issues for moving companies is a industrywide labor shortage while movers get sick.

“Everyone wanted to flee New York because it was the epicenter, but at the same time, our movers started getting sick,” said Norber of Imperial Movers, who added that the company lost a dozen workers who were either too ill or too afraid to show up. He has been using company vans to pick up movers instead of letting them take public transportation. Norber says he’s operating at around 40% capacity.

“We didn’t know what the summer would bring, so we didn’t ramp up hiring as quickly,” said FlatRate Moving CEO David L. Giampietro, who added that after it became obvious demnad was spiking, “all the moving companies were competing for workers.”

Read the rest of the report here.

Authored by Simon Watkins via OilPrice.com,

Having failed to achieve the slightest semblance of success in the two oil price wars that it started – the first running from 2014 to 2016, and the second running from the beginning of March to effectively the end of April this year – it might be assumed that key lessons might have been learned by the Saudis on the perils of engaging in such wars again.

Judging from various statements last week, though, Saudi Arabia has learned nothing and may well launch exactly the same type of oil price war in exactly the same way as it has done twice before, inevitably losing again with exactly the same catastrophic effects on it and its fellow OPEC members. 

At the very heart of Saudi Arabia’s problem is the collective self-delusion of those at the top of its government regarding the Kingdom’s key figures relating to its oil industry that underpins the entire regime. These delusions are apparently not discouraged by any of the senior foreign advisers who make enormous fees and trading profits for their banks from Saudi Arabia’s various follies, most notably oil price wars. It is, in the truest sense of the phrase, a perfect example of ‘The Emperor’s New Clothes’, although in this case, it does not just pertain to Crown Prince Mohammed bin Salman (MbS) but to all of the senior figures connected to Saudi Arabia’s oil sector. One of the most obvious examples of this is the chief executive officer of Saudi Arabia’s flagship hydrocarbons company, Saudi Aramco (Aramco), Amin Nasser, who said last week – bewilderingly for those who know even a modicum about the global oil markets – that Aramco is to go ahead with plans to increase its maximum sustained capacity (MSC) to 13 million barrels per day (bpd) from 12.1 million bpd.

Quite aside from the sheer pointlessness of this posturing in a world already awash in oil as a result of the negative demand effect of the COVID-19 pandemic and the output overhang from the oil price war just ended, this comment from Saudi Arabia’s third-ranking oil man (after MbS, albeit by the loosest possible definition, and Energy Minister, Abdulaziz bin Salman al Saud), is extremely misleading. As such, it feeds into the oil market’s collective understanding since the 2014-2016 oil price war that anything that Saudi Arabia says about its oil industry is not to be taken as true, without a lot of additional fact-checking. Regarding the ‘maximum sustained capacity’ statement, to begin with, this term is one that has been repeatedly used by Saudi Arabia since the first oil price war disaster to cover for two other long-running delusions relating to the real level of its crude oil reserves and to the real level of its spare capacity.

Before the 2014-2016 oil price war, Saudi had stated for decades that it had a spare capacity of between 2.0-2.5 million bpd. This implied – given the widely-accepted (but also wrong) belief that Saudi Arabia had pumped an average of around 10 million bpd for many years (it actually pumped an average of just over 8.162 million bpd from 1973 until 2020) – that it had the ability to ramp up its production to about 12.5 million bpd when required. However, even as the 2014-2016 oil price war dragged on and wreaked new heights of economic devastation on Saudi Arabia and its OPEC colleagues, the Kingdom could produce on average no more than just about 10 million bpd. Crucially here, the Energy Information Administration (EIA) defines spare capacity specifically as production that can be brought online within 30 days and sustained for at least 90 days, whilst even Saudi Arabia has said that it would need at least 90 days to move rigs to drill new wells and raise production by an additional 2.0-2.5 million bpd.

Instead, from that point onwards, Saudi Arabia began to attempt to obfuscate this spare capacity lie by semantic trickery. Senior Saudis spoke of ‘capacity’ and of ‘supply to the market’ rather than of ‘output’ or ‘production’ and these two groups of terminology mean very different things. ‘Capacity’ (or its synonym, as far as the Saudis are concerned, ‘supply to the market’) relate to the utilization of crude oil supplies held in storage at any given time in the Kingdom plus the supplies that can be withheld from contracts and re-directed into those stored supplies. It can also mean oil clandestinely bought in from other suppliers (notably Iraq in the last oil price war) through brokers in the spot market and then passed off as its own oil supplies (or ‘capacity’). Exactly the same semantic trickery was used to cover up the actual supply shortfalls in the aftermath of the September 2019 attacks by the Iran-backed Houthis on Saudi Arabia’s Khurais and Abqaiq facilities, with the Energy Minister talking of ‘capacity’ and later of ‘supply to the market’, which are absolutely not the same thing at all as actual production at the wellheads.

The reason why Saudi Arabia seeks to obfuscate its real production and also spare capacity figures is that oil has been the only true foundation-stone of the Kingdom’s geopolitical power since its discovery in the late 1930s and this is also why it lies about its crude oil reserves. Specifically, at the beginning of 1989, Saudi Arabia claimed proven oil reserves of 170 billion barrels but only a year later, and without the discovery of any major new oil fields, the official reserves estimate somehow grew by 51.2 percent, to 257 billion barrels. Shortly thereafter, it increased again to just over 266 billion barrels, a level that persisted until a slight increase in 2017 to just over 268 billion barrels, with, again, no major new oil field finds made, a figure which – depending on who you believe – has increased yet again. At the same time, as highlighted, Saudi Arabia took out of the ground an average of 8.162 million bpd from the beginning of 1973 to the beginning of 2020, which totals over 2.979 billion barrels of crude oil every year, or 137.04 billion barrels of crude oil taken out of the ground over that time period. Given this tangible and proven production, with no major new field finds (and declining production at many of its core oil fields as well, including Ghawar), it is mathematically very difficult to see how it is possible that Saudi Arabia’s crude oil reserves are not actually around 120 billion barrels (and that is using the highly-dubious 257 billion barrels base figure) and not the stated 268+ billion barrels.

Given the wider public realization that the core figures upon which Saudi Arabia’s remaining geopolitical and economic power is based are essentially nonsense, Aramco’s share price might – in the normal circumstances of a correctly functioning market – be regarded as vulnerable. However, such was the absolute desperation on the part of MbS not to lose personal credibility by allowing the omni-toxic Aramco IPO to be seen to fail – at least in Saudi Arabia – that very few of the share purchasers have much to lose. In order to even sell the 1.5 percent stake finally offered (cut down from the initially-mooted 5 percent), Saudi banks were ‘encouraged’ to offer to lend money to retail customers at a 2-to-1 ratio for every riyal they would invest in Saudi Aramco (compared to average leverage ratio limit for loans of 1-to-1). Additionally, the IPO’s international adviser banks were there to take up any slack in the offering left after the sovereign wealth funds of neighboring states were equally ‘encouraged’ to participate on the offering, as were various senior Saudis fearful of a re-run of their treatment in the Ritz Carlton in 2017.

Now, in addition to these levers, Aramco has also reassured this small cadre of investors that it will meet the minimum US$75 billion dividend payout that it was forced into promising in order to ensure that it sold even 1.5 percent of the company. As Aramco’s share price is now intimately connected to MbS’s standing at home, Aramco has little choice in the matter, despite the announcement last week that its net profit plunged by 73.4 percent in the second quarter of this year. This was entirely due, ironically, to Saudi Arabia’s starting yet another oil price war to destroy the U.S. shale sector by crashing prices through overproducing at a time when demand was already annihilated by the COVID-19 pandemic. Such figures, of course, will become entirely meaningless if Saudi Arabia embarks on yet another oil price war in the not-too-distant-future, as is the clear implication of the announcement that it will increase its MSC to 13 million bpd from 12.1 million bpd, as the result for Saudi Arabia next time could be the end of the al-Saud dynasty in the Kingdom.

Yesterday we showed that following the July 31 fiscal cliff, spending among unemployed workers – those impacted the most by the end of the emergency Unemployment Insurance fiscal stimulus program – declined substantially just as many had expected…

… with the decline affecting virtually all income cohorts, as the YOY growth rate slowed by 12% for the unemployed cohort (formerly) earning under $50K vs. a roughly 5% drop for the middle and upper income cohorts (more here), even as spending among all other Americans posted a healthy increase.

Yet despite some marginal fluctuations, spending continued as per the norm for a society where 70% of GDP comes from consumption (mostly funded by debt).

So using the latest Bank of America data, what have Americans been spending more – and less – on during the pandemic? Well, as the chart below shows, the latest weekly data shows that total card spending, as measured by aggregated BAC credit and debit card data, dipped a modest -0.1% yoy for the 7-day period ending August 15th, meaning that overall spending is virtually identical compared to last year, and is also consistent with the rate of growth since late June. In fact, excluding autos, spending is up a whopping 8% likely reflecting the tail end of the government’s extra generous benefits.

However, the composition of spending has changed dramatically, with spending on “person to person” service industries still dismal, with airlines, entertainment and lodging all down between 42% and 83%. Separately, spending on restaurants & bars, transit, gas and clothing is down double digits Y/Y.

At the same time spending on online shopping for electronics has exploded, up 95% compared to a year ago, and everything home related – in a time of universal Work From Home – also soaring (Home improvement up 29%, furniture up 27%) to go along with the great migration from cities to suburbs.  But the biggest beneficiary is overall online spending – read Amazon – where Americans have spent a massive 69% more compared to last year.

Another notable observation: spending on credit remains depressed on a Y/Y basis, down 12% Y/Y, as Americans remain unwilling to incur more debt in a time of great uncertainty about the future (unlike their corporate peers). So where is the funding coming from? As the chart below shows, it’s all debit cards – which are up 10% Y/Y – as Americans for once drain their savings generously funded by Uncle Sam.

So with all that in mind, here is how aggregate US spending by major category has changed compared to this time last year:

Below is some additional spending spending as broken down by state of reopening…

… and which shows that for the most part spending across various segments has caught up regardless of when a state reopened. As BofA notes, over the past several weeks, there has been a convergence in spending trends between the states regardless of the timing of the initial reopening and path of the virus. That said, there is some differentiation in beauty salons and recreation services which likely reflects the decision of some states – most notably California – to roll back the reopening.

We next look at spending on a regional basis, comparing the largest US Metro Statistical Areas to find that the biggest declines can be found in liberal West Coast cities – San Fran, Seattle and Portland – while the most notable rebounds have been observed in Detroit and such sunbelt MSAs as Atlanta, Tampa and Miami.

The same chart but broken down by state:

One final observation: the bulk of the spending boost continues to be led by low income (those making <$50K) Americans, while those in the mid-range ($50-$125K) are unchanged from last year, while the upper cohort of Americans making >$125K remains subdued compared to 2019.

This is problematic because as noted above, it is these lowest-income Americans that will be most adversely impacted now that the fiscal cliff has resulted in a material decline in government stimulus checks, and implies that – all else equal – consumption, and US GDP in general, are about to post a sharp decline.

By Rosie Bradbury of Restaurant Dive,

• New York City’s restaurants may be forced to return to only takeout and delivery in the fall to stall a second wave of coronavirus cases, New York Gov. Andrew Cuomo told reporters on a conference call Wednesday, CNBC reports.

• Cuomo claimed that New York City’s restaurants have “a much bigger problem” with lack of compliance with COVID-19 restrictions than in surrounding areas, though that assertion has been disputed. Unlike other parts of the state, the city’s restaurants have not been allowed to return to reduced-capacity indoor dining.

• Restaurant operators in the city have indicated their willingness to pursue legal action in the face of an indefinite halt to indoor dining, according to Restaurant Business. Executive Director of NYC Hospitality Andrew Rigie predicted this week that restaurant closures could be “in the thousands” over the next six to 18 months.

Restaurant operators have expressed concerns that as temperatures drop, diners’ openness to outdoor dining will dwindle. However, Cuomo’s remarks in a press conference this week reflect his continued reluctance to progress toward reopening, citing the potential of a second wave of coronavirus cases, the risks posed by the city’s high population density and impending flu season.

But operators warn that without a dine-in plan, the city’s restaurant industry will be decimated. Prior to the pandemic, the city had more restaurants, cafes, and food stores per capita than anywhere else in the country

A recent NYC Hospitality Alliance reports found that over 80% of the city’s businesses were not able to pay full rent in July, and many independent businesses raised alarm in May that solely takeout and delivery were not bringing in enough revenue to cover their costs. A New York Times report on Yelp data estimated that over 2,800 businesses in the city have closed since March 1, and the city’s financial budget documented a 90% drop in restaurant spending in late March, when operations were restricted to solely takeout and delivery ordering.

For many of the city’s restaurants, especially those concentrated in business districts, outdoor dining may not be financially sustainable in the long term, and a return to delivery and takeout-only could be devastating. 

Statewide, 150 restaurants and bars have had their liquor licenses revoked for failing to adhere to coronavirus safety requirements as part of Cuomo’s “Three Strikes and You’re Closed” policy. Cuomo asserts that compliance with social distancing has been particularly lax in the city, however a Politico report found that the city’s enforcement measures were largely in line with that in municipalities elsewhere in the state.

Local and state officials have mentioned the difficulties of enforcing mask wearing in dining rooms, as well as upsurges in coronavirus cases across multiple regions as their justification for indefinitely halting indoor dining. A significant portion of community outbreaks this summer have been traced to bars and restaurants, including roughly a quarter of Louisiana’s cases since March and 12% of Maryland’s cases in the month of July. 

Epidemiologists say that outdoor and patio dining carries a lower likelihood of virus spread. Lindsey Leininger, a health policy researcher at Dartmouth, told The New York Times that they “hadn’t traced a major U.S. outbreak of any sort to an outdoor exposure.” However, restaurant staff serving a number of parties are placed at greater risk than with takeout service. Restaurant architect Marites Abueg suggested that restaurants could minimize the danger to workers by reducing touchpoints, such as eliminating table service in favor of window ordering. 

Wells Fargo has certainly led the way in the banking sector when it comes to things like massive scandals and botching Small Business Relief Loans – so why not lead the way when it comes to announcing massive layoffs?

That’s exactly what the bank has done. Under pressure to lower its costs, the bank “quietly ended a moratorium on terminations in recent weeks” according to the LA Daily News. The move is seen as the bank preparing to make deep job cuts. 

Beth Richek, a spokesperson for the bank, offered up a perfunctory dodge: “Starting in early August, we resumed regular job displacement activity.”

She continued: “We are at the beginning of a multiyear effort to build a stronger, more efficient company. We expect to reduce the size of our workforce through a combination of attrition, the elimination of open roles and job displacements.”

Chief Executive Officer Charlie Scharf said last month:  “We have a series of employees who’ve been told that their jobs will ultimately go away. But we are going to let some time pass as we got through the initial stages of the COVID crisis.”

Tens of thousands of jobs could be on the chopping block, according to the report. Scharf said: “It’s like an onion: The more we do, the more clearer the next round will become.”

Cuts will begin with people the firm had originally planned to let go this year, prior to the Covid crisis. Those cuts will move on to additional employees and an effort to “thin management ranks” and “remove underperformers”. 

Recall, the bank reported its first quarterly loss in over a decade and slashed its dividend by 80% this year. The cuts could open the floodgates for other banks to act accordingly, citing Wells Fargo as their “all clear”.

U.S. banks have mostly abstained from cutting employees this year, despite European banks engaging in active talks to cut their workforces. 

Authored by MN Gordon via EconomicPrism.com,

Your Figuring Central Planners At Work

“Every man is a consumer, and ought to be a producer,” observed 19th century philosopher Ralph Waldo Emerson.  

“He is by constitution expensive, and needs to be rich.”

These days Emerson’s critical insight is being taken to its extreme.  Consumers, many whom lost their jobs due to government lockdown orders, no longer produce.  Yet they still consume.  They’re expensive.  Not rich.

What’s more, this consumption is not funded through personal savings.  Nor is it funded through government transfer payments.  Rather, it’s funded via the printing press.

Emerson, no doubt, was lacking in the unique perspective we’re presently granted.  He didn’t have the special opportunity to watch his government destroy the economy in short order.  Perhaps if he had, he would have penned a neat axiom to distill the essence of what has happened.

The world today looks nothing like Emerson’s day.  The 19th century was an age of honest money.  Central bankers did not roam the land.

Printing money to buy bonds and stocks, and to sprinkle on people, would have been quickly dismissed.  The experience of the Continental Congress during the American Revolution, and their over issuance of paper “continentals”, had shown that resorting to the printing press was an act of suicide.

Currently, printing press money is considered enlightened central banking policy.  Inflation targets, zero interest rate policy (ZIRP), direct bond purchases, twisting the yield curve, unlimited credit.  This is merely a partial list of the trouble central bankers are up to.

Despite all the well-meaning intentions they may have, the efforts of central bankers in 2020, let alone the 21st century, have been a disaster.  Where to begin…

Pure Arrogance

During the Great Recession, money supply expansion was mainly restricted to financial markets via ZIRP and Treasury purchases.  Stocks, bonds, and real estate prices increased much faster than worker incomes.  Financial assets holders, mainly the rich, got the nirvana of Fed inflated wealth.  Wage earners and savers got exactly squat.

Money supply expansion for the 2020 bailouts, as initiated by the Fed’s Primary and Secondary Market Corporate Credit Facilities (PMCCF and SMCCF), also puffed up financial assets.  However, in addition to financial markets, the 2020 bailouts, as initiated under the CARES Act, directed bailout funds into the real economy through stimulus and unemployment checks.  The intent of this money served to compensate for spending lost from mass unemployment and business closures.

According to the Bureau of Labor Statistics, the consumer price index (CPI) increased 1 percent over the last 12 months.  Here at the Economic Prism we’d prefer a stable money supply and no price inflation.  But what do we know.  We don’t think like central planners.

Central planners, of just the right academic pedigree, want an expanding money supply.  They also want moderate price inflation – 1 percent per year is not nearly enough – to ease an ever expanding debt burden.  These are things they want.  And they think they know just how to get them.

These smart and clever fellows think that with the right market interventions, programs, and policies, they can target just the right price inflation.  This line of thinking, while it may make for interesting academic fodder, is pure arrogance.

Your Figuring Central Planners At Work

The central planners never hit their inflation targets.  But, in spraying the economy with birdshot, they cause massive disruption.  This aside, assuming the central planners at the Fed could target price inflation, what rate of inflation would they precisely pinpoint?

This exact question is what the spoon benders at the Fed have spent the better part of the past year figuring.  In fact, they are currently working overtime so they can provide their answer in a forthcoming policy initiative.  Fed Chair Powell said they’d have it all wrapped up “in the near future.”  From what we gather, it’ll be hitting the press sometime in September.

What in the world will this new policy initiative include?  Will it be something radical?  Will a new era of dollar debasement be upon us?

We’ll have to wait and see.  But in the interim, several hints have been offered.  Here’s Dallas Fed President Robert Kaplan, after consulting the person in the mirror:

“I would be willing to see inflation run moderately above 2 percent in the aftermath of periods where we’ve been running persistently below.”

Prior to joining the Dallas Fed, Kaplan was a Senior Associate Dean and the Martin Marshall Professor of Management Practice at Harvard Business School.  Before that he spent over 20 years at Goldman Sachs – doing God’s work.

Between 2011 and 2015, Kaplan wrote a series of books titled: What to Ask the Person in the Mirror.  What You’re Really Meant to Do.  What You Really Need to Lead.

It really is too bad he never wrote a book titled: How to Not Be a Moron.  He may have found the endeavor helpful.  Because just after revealing his willingness “to see inflation run moderately above 2 percent,” Kaplan, a moron, wafted this sulfurous equivocation:

“I’m not making a commitment of what we’re going to do, I’m basically suggesting a tendency or likelihood, but it’s going to be subject to conditions we find and we’re going to have to adapt to those conditions.”

There you have it, folks.  Your figuring central planners at work.

As speculation about a state-backed plot and Russia’s upcoming elections swirl, it appears Russian anti-corruption zealot Alexei Navalny has arrived in Germany in “worrying” condition now four days after his plane was forced to make an emergency landing in Siberia so that the opposition candidate could be treated for what he said was a deliberate poisoning.

Navalny, who has reportedly been in a coma since Thursday, remains in a “very critical”, though, somehow, still stable, condition since arriving in Germany for medical treatment after Russian officials allowed his family and his organization to intervene, according to Bloomberg.

Navalny was purportedly poisoned once before while in prison in Moscow, but officials poured cold water on his claims then, too.

“The good news is that he arrived in Berlin in a stable condition,” said Jaka Bizilj, co-founder of Cinema for Peace, which facilitated Navalny’s move to the Charite hospital. While there, Navalny will be examined by doctors with Germany’s biggest teaching hospital, who will need to try to help him and ascertain medical facts, said Bizilj.

Navalny was permitted by Russian authorities to leave the hospital in Omsk, Siberia, after his family, activists and international leaders appealed directly to President Vladimir Putin, who according to Russian media has never once mentioned his opposition rival by name.

Chancellor Angela Merkel’s government said it hopes Navalny’s treatment in Berlin will lead to “a complete recovery,” though she said little else to annoy Putin, given its reliance on Russian energy.

Manuela Zingl, a Charite spokeswoman, said by phone today that Navalny is already undergoing a “comprehensive diagnosis of his condition” and that more would be known soon. Navalny is “a strong man and went swimming the day before he fell ill,” said Bizijl, a Slovak film producer.

Though the doctors who treated Navalny in Omsk said only that his illness was likely due to some unspecified ‘metabolic condition’, a spokeswoman for Charite said the opposition leader was undergoing a “comprehensive diagnosis” of his condition.  Doctors who treated Navalny in Siberia said traces of chemicals were found on his hands and in his hair.

So it looks like they are determined to find he had been poisoned after all?

A top insurance executive at Guggenheim Partners has been charged with negligence and reckless driving as a result of a December boating collision that took place near Fort Lauderdale. 

Guggenheim’s Daniel Towriss now faces five misdemeanors as a result of the accident and has pleaded not guilty to all five charges, according to the Wall Street Journal. 

The collision left a brand new 42 foot custom yacht upended on a jetty shortly after midnight on December 31. Two of his passengers were thrown from the boat and suffered injuries as a result, according to another lawsuit filed in July. The passengers allege that Towriss was driving “recklessly and under the influence”.

One of the passengers “suffered a fractured skull and injuries to her brain, leg and ribs, and has since had three surgeries”. Both passengers claimed in a lawsuit that Towriss “had a mixed drink and a share of two or three bottles of wine” before going out on the boat. On the boat, they claim he had another drink, became unaware of his surroundings and “permitted the boat to drift in an erratic way on the open water in dark, nighttime conditions.”

Guggenheim refrained from commenting, telling the WSJ: “The boating accident you have inquired about is a personal matter that occurred during a holiday vacation and is entirely unrelated to Mr. Towriss’s business duties and responsibilities.”

Towriss’ lawyers – as lawyers do – blamed the jetty and the passengers.

John Seiler, lawyer for Mr. Towriss, said Towriss was disappointed that the “boating outing among friends of many years turned into a lawsuit for money damages and the end of a friendship.”

Eric Schwartzreich, another one of Mr. Towriss’s lawyers, said: “We’re disappointed in these charges and intend to vigorously fight them in Court. This accident happened because of the well-known and dangerous conditions of the jetty.’’

Authored by Gary Galles via The Mises Institute,

The US Postal Service has recently made a comeback in the headlines. Not only has the red ink it has long bathed in gotten deeper, but now it has become embroiled in mudslinging over vote-by-mail issues, such as people failing to get the ballots mailed to them and possible delays in processing election results, using that to make “new and improved” monetary bailout requests, with politicians and letter carrier unions attacking any cutbacks in service, even down to dropping underutilizing drop boxes.

With the Postal Service’s massive and unsustainable losses, what is striking is that even with a new reformer in charge, there is virtually no consideration of abandoning the USPS’s monopoly on first-class mail, allowing rivalry from private providers to reveal the services and prices market competition could offer. Not only does competition have a long record of success in countless products and services, but history shows it is not impossible in postal services. As Adam Summers has written,

Several private mail entrepreneurs sprouted up from about 1839–1851. While they were eventually shut down by the government, they proved that private mail delivery was possible. And the competition they provided forced the government to drastically reduce its prices in the process.

Summers brings up an important question: What so blinds us to even the possibility of allowing postal competition? He is not the first to ask that question. Leonard Read, wellspring of the Foundation of Economic Education and tireless advocate of “freedom philosophy,” wrote about the postal monopoly several times, starting more than half a century ago. The current mail meltdown makes it worth revisiting his understanding. Consider his insights from “Pre-Emptors: Agents of Destruction” in Comes the Dawn (1976) and “Causes of Authoritarianism” in Why Not Try Freedom? (1958):

Any time any activity is preempted, all thought as to how it would be conducted by free and self-responsible people is deadened.

An example…mail delivery. Our postal system is a socialistic institution….Its record? As all users know, a dramatic increase in rates, enormous deficits mounting annually, and service deteriorating rather than improving.

Observe the effect of this pre-emption: no intelligent thought of what this type of communication would be like among a free and self-responsible people.

There are many among us…without the slightest idea of what the freedom alternative would be. Why this blindness as to the results of freedom? The answer is: the actions of free men are quite impossible to foresee!

It is one thing to believe that competition affords more efficient service than does a monopoly. Indeed, this very belief is implicit in the arguments of government officials who refuse to permit private delivery of mail: the U.S. Postal Service couldn’t stand the competition; someone else would do it more efficiently and at less cost to the customer.

But as long as the monopoly is coercively maintained, there is no legal way to prove that the cost of performing an identical service would be lower under competition—or how much lower. Nor can it be proved beyond doubt that competitive private enterprise would indeed perform precisely the same services now available through the Postal monopoly.

But this is the whole point of anyone who believes in the blessings of competition as the most efficient way to provide the goods and services customers are willing and able to pay for. Such faith must concede that no one knows or can know in advance just the form in which the postal service would emerge and develop were everyone free to devote his own ingenuity and time and scarce resources toward serving the ever-changing demands of willing customers in a free market.

If all those changing conditions could be foreseen by any one individual, there is no logical reason why he could not make socialism work. But that is the whole case against socialism and for competitive private enterprise: the unknown is not foreseeable or predictable with certainty; conditions change, and freedom affords us the best possible chance to cope with those changes.

If one believes the Postal monopoly should be abolished, it is in part because he has witnessed miraculous market developments in the delivery of items other than mail.

Take voice delivery. How far could the human voice be delivered prior to the beginning of the Bell system…[now] the miracle of the market—around the earth…at the speed of light….Those who find this not particularly amazing are nonetheless reluctant to entrust the delivery of mail to the unhampered and unpredictable ingenuity of a free and self-responsible people!

Why this fear to try—this lack of faith in the potential wonders that might be ours? There are at least two reasons: (1) we cannot foresee the unknown and, thus, we are not attracted to the unimaginable, and (2) the moment a miracle is wrought, we take it as much for granted as the air we breathe….We no longer give it a second thought.

Years ago, I observed that no person knows how to make such a “simple” thing as an ordinary wooden lead pencil. Yet, that year, we made 1,600,000,000 pencils in the U.S.A. Were we to grasp this single miracle of the free market, we would know that there is not a person who knows how to operate a postal service.

Why, then, does the Free Society work its wonders? Why, when no one knows how to make a pencil, do we have such a proliferation of goods and services?…ideas by everyone are free to flow!…Ideas configurate and show forth in everything from billions of pencils to jet planes.

But most people fail to generate ideas on activities that have been pre-empted.

As the belief grows that coercion is the only practical way to get things done…belief in the competence of man acting privately, freely, voluntarily, competitively, cooperatively declines. As the former increases, the latter decreases.

In the U.S.A., for example, government has a monopoly of mail delivery. Ask citizens if government should do this and most…will reply in the affirmative. Why? Simply because government has pre-empted this activity for so many decades that all enterprisers have ceased to think how mail could be delivered were it a private enterprise opportunity. Indeed, most of them have come to believe that private enterprise would be wholly incapable of effective mail service.

Yet, I note that each day we deliver more pounds of milk than mail. Further, milk is more perishable than a love letter, a catalogue, or an appeal for funds…the delivery of milk is more prompt and less costly to us than is the delivery of mail.

I ask myself, then, why shouldn’t private enterprise deliver mail? Private enterprise delivers freight.

But, no; my countrymen have lost faith in man’s ability, acting freely, to deliver letters…men who do such fantastic things have lost faith in themselves to do the simple chore of letter delivery.

Today, even the massive, ongoing failures of the US Postal Service and the new political attention being drawn to it seem unable to overcome a pervasive blindness to the potential of competition to benefit Americans. That vindicates Leonard Read’s insight that not only are the ideas and the benefits that freedom can create often preempted by government, but that people can, as a result, lose the belief that a free society can do those things that have been coercively crowded out. And, in his ominous words, “A decline in faith in free men and what they can accomplish results in a rising faith in disastrous authoritarianism.”

The current postal situation offers a chance to rethink what many have been lulled into taking for granted. Not only is real competition a valid alternative, despite our inability to know in advance precisely what it would look like, but if the history of freedom is any guide, it would be far superior.

The National Hurricane Center’s (NHC) latest update (Saturday morning) on two tropical storms swirling in the Gulf of Mexico, with crosshairs both pointed at the Gulf Coast of the US, is that both storms are set to strengthen through the weekend. 

Readers may recall, Tropical Depression 13 (upgraded to Tropical Storm Laura) and Tropical Depression 14 (upgraded to Tropical Storm Marco), are two systems positioned in different locations of the Gulf of Mexico, with long-term tracking models both forecasting the storms could make landfall in very similar areas within, or a little more than a day apart. 

“It is really unprecedented to have two storms make landfall within 24 to 36 hours in essentially the same spot,” Aaron Carmichael, a meteorologist with the commercial forecaster Maxar, told Bloomberg. 

The last time two storms simultaneously traversed the warm waters of the Gulf was in 1959. The current forecast suggests Marco could strike south Texas to western Louisiana, on Tuesday, while Laura could make landfall on Wednesday evening into Thursday from Houston, Texas, to Mobile, Alabama. 

The NHC released a statement at 11:00 ET about new updates on Laura, indicating the system is moving across the Virgin Islands and Puerto Rico. 

Another statement was released by NHC detailing Marco could become a hurricane on Saturday night. 

Long-term track models of both systems suggests, if both are upgraded to hurricane status before landfall, there could be widespread coastal damage from Texas to Alabama. 

Carmichael said, “there’s still a lot of uncertainty with the forecast because the two storms could interact, with one sapping the other of its strength.” 

The prospects of two storms slamming into the Southern US early next week comes as President Trump signed an executive order to redirect the Department of Homeland Security’s Disaster Relief Fund to support weekly unemployment checks for tens of millions of broke Americans. 

Oh, and yes, there’s also a coronavirus pandemic ravaging Sun Belt states, along with depressionary unemployment – a perfect storm to say the least…