No Qualified Immunity for Kentucky Cops Who Strip-Searched a 4-Year-Old and Threatened Mom

dreamstime_xxl_160387259

Good news, parents: If you let your kids wait in the car for less than 10 minutes on a cool day—doors locked and fan on—a caseworker and sheriff are actually not allowed to come to your home, threaten to take your children away, and strip search the kids.

These very basic rights were just vindicated the hard way: by a Kentucky mom in federal court. Holly Curry sued the cop and the caseworker, insisting that the day she was investigated for child abuse, the two authorities so overstepped their bounds that they should not be afforded qualified immunity. In other words, their behavior was so egregious, they had to take responsibility for it. The judge agreed.

You may recall the case. Back in March of 2017, Curry was driving her kids to karate when she stopped to get them some muffins. She was in the café for just a few minutes. When she came out, two cops rebuked her for leaving the kids.

In Kentucky, it’s a crime to leave children under the age of eight in a car under circumstances that “manifest an extreme indifference” to human life and create a grave risk of death. But the cops didn’t say she’d done that. The kids all looked fine, and they the officers left without charging Curry with a crime. Nevertheless, they felt obligated to call the state’s child protection hotline, thus opening a neglect investigation which automatically required a visit to the Curry home to check on the kids.

When the caseworker arrived at the home, Holly refused to let her in without a warrant. The worker returned with a sheriff’s deputy, but still no warrant. When Holly insisted that they still couldn’t enter, they threatened to “come back and put your kids into foster care.” Holly begged for time to call her husband. They refused. Finally, crying and terrified, Holly let them in.

Labeling that decision “voluntary consent,” the authorities entered the home. Unsurprisingly, the house and kids all looked fine. Even so, the caseworker insisted on strip searching each kid, removing their underwear and examining their genitals for signs of abuse.

A few months later, the caseworker closed the investigation as “unsubstantiated,” saying that what Holly had done was a “one-time ‘oopsy-daisy.'” But she telephoned Curry later and said, “If we ever get a call against your family again, bad things will happen to you, and we’ll take your children.”

At that point, Curry had had enough. She turned around and filed suit against the caseworker and cop, claiming violation of her constitutional rights.

They, in turn, pressed hard for immunity. But in in a powerful ruling on August 19 in Curry v. Kentucky Cabinet for Health and Human Services, Judge Justin Walker said that it was clear the government used an improper threat to enter the home, lacked any evidence that might have justified a strip search, and violated the children’s rights to bodily integrity. According to Walker:

Act One: An “attentive and loving” mother gets muffins for her children. Act Two: There’s a knock on her door and a threat by the government to take away her children. Act Three: Her children are strip searched without cause. America’s founding generation may never have imagined a Cabinet for Health and Family Services. But they knew their fair share of unwelcome constables. And they added a Fourth Amendment to our Constitution to protect against this three-act tragedy.

To enter a home without consent and examine stripped kids requires a warrant, genuine suspicion of abuse, or an actual emergency. Who knew? Apparently not the authorities in Kentucky, who have been defending the warrantless entry and strip ever since the Curry’s filed their lawsuit in 2018.

Assuming the decision stands, “it’s very good news for child welfare and police reformers,” says Diane Redleaf, co-chair of United Family Advocates and Let Grow’s legal consultant.

“It’s also welcome news for all the parents who want to give their kids some unsupervised time—to walk to school, to come home with a latchkey, to wait briefly in the car—but fear what could happen to them if an onlooker decided to call 911,” says Redleaf.

The Currys are home schoolers who enlisted James R. Mason, executive director of the Home School Legal Defense Association, to file the federal suit on their family’s behalf. Mason hopes that now the authorities will think twice before barging into homes and strip searching kids without evidence of wrongdoing by the parent. The investigator in the case testified that they “automatically strip search every child when they go into a home,” Mason notes. “No more.”

from Latest – Reason.com https://ift.tt/2Yr945V
via IFTTT

What About…Defunding the Police?

Defund the Police

In this month’s issue, we draw on decades of Reason journalism about policing and criminal justice to make practical suggestions about how to use the momentum of this summer’s tumultuous protests productively. Check out Damon Root on abolishing qualified immunity, Peter Suderman on busting the police unions, Jacob Sullum on ending the war on drugs, Sally Satel on rethinking crisis response, Zuri Davis on restricting asset forfeiture, C.J. Ciaramella on regulating use of force, Alec Ward on releasing body cam footage, Jonathan Blanks on stopping overpolicing, and Nick Gillespie interviewing former Reasoner Radley Balko on police militarization.

The current wave of protest in the United States since the death of George Floyd has gone beyond familiar demands for changes in police tactics and punishments for officer misconduct to something altogether more radical. Increasingly, the goal is for police departments in major cities to be “defunded.” At the very least, this would mean a serious rethinking of the current model of American policing and a significant redirection of public spending to other ends. In its more extreme variants, it would mean much more: a move away from the very idea of a public police force, uniformed, permanent, paid for through taxation, and possessed of powers not enjoyed by ordinary citizens.

This would not just represent a change in policing methods and the pattern of government spending; it would be a revolutionary rejection of what for 200 years has been a core capacity and function of the modern state. The immediate response of most to this idea is that abolishing the existing system in this way would lead to an explosion of criminality and violence. The underlying belief is that it is only the active presence of a police force of the kind we are familiar with that stops such an explosion from happening. But history and modern criminology suggest otherwise. 

Calls to defund the police are being made across the United States. In Minneapolis, where the current wave of protests began, the City Council’s majority has committed to a strategy, already advocated by some local community organizations, of a version towards the radical end of the suggestions. In Los Angeles, the suggestion is to reduce the city’s police budget from 51 percent of general fund spending to 5.7 percent.

The push for defunding has been triggered by specific incidents and growing frustration at a trend involving deaths at the hands of police officers following arrests or confrontations over minor matters. However, that particular concern derives from a more general discontent (also growing) with the way the entire policing and law enforcement system works. This critique has several aspects. The first is simply the cost of policing in contemporary America. A recent report calculated that total annual police department spending in the U.S. amounts to $115 billion. In Minneapolis, police spending accounts for 30 percent of the total budget. In Los Angeles, the 51 percent of spending accounted for by the Los Angeles Police Department (LAPD) comes to $1.8 billion a year. These are not small amounts—and the cost has been rising steadily even as crime has been declining sharply since the middle of the 1990s.

The discontent goes beyond mere cost, however. It relates to the whole style and philosophy of policing on display in most U.S. metropolitan areas and beyond. As The Washington Post‘s Radley Balko has pointed out, the last few decades have witnessed a militarization of U.S. policing to the point where large urban police forces are equipped like, and too often behave like, an occupying army (without the military training). This has much greater consequences because of two other developments, which in turn grow out of the philosophy and vision that has driven much U.S. policing since its creation in the mid–19th century. 

The first development is the use of the police as an agency for moral and social policy. This includes enforcing the laws against nonviolent, consensual crimes (e.g., the war on drugs) and dealing with local community or public health problems (e.g., mental health issues and domestic abuse). The second development is the growth of “broken windows” policing, a strategy where officers aggressively address minor infractions of the law, such as vandalism, often with maximal force. This is the contemporary version of “proactive” or “preventative” policing, a strategy that has been tried in places around the world since it was first advocated at the end of the 18th century—virtually always with bad results. This kind of policing brings militarized police officers into regular contact with members of the public. Not a random selection of the public, though; members of disadvantaged groups (typically African Americans and other minorities, but also poor whites) are disproportionately affected. This in turn leads to often violent confrontations and a policing policy that, instead of preserving public order and safeguarding communities, actively disrupts order and escalates violence in communities.

What does “defunding” mean in practical terms? One consistent element is that much current spending on police should be redirected elsewhere. The more moderate proposals call for either large cuts to existing budgets or for the existing department to be replaced by a new and smaller one (with different personnel). The most radical idea is that the entire police system should be scrapped and replaced by some other mechanisms for maintaining public order. Importantly, different entities (either public or private) would be tasked with dealing with minor rules infractions on the one hand and handling serious or violent crime on the other. This idea calls the whole notion of policing as a central function of the state into question.

The immediate response to these ideas, and particularly the last one, is often that they are preposterous. Most people believe that getting rid of the police force in its present form would lead to immediate chaos. Advocates of defunding are at pains to explain that they are talking not about shutting down departments overnight but about a process to redefine the policing function, with one method of maintaining social order replaced by another. Yet these explanations tend to fall on deaf ears. 

One reason has to do with widespread beliefs that serious crime is much more prevalent than it really is and that dealing with it is the main function of a police force. Neither is true. Pew Research Center reports that 60 percent of the American public believes crime is higher today than a year ago, even though FBI and Bureau of Justice Statistics data show that it has been declining steadily since 1993. Meanwhile, studies have consistently found that police spend only about one-fifth of their time dealing with actual crime.

Because the actual main purpose of the uniformed police is enforcing rules and maintaining order in public places, these misconceptions can have knock-on effects. For the most part, people recognize that most of their peers are law-abiding and peaceful, but they also tend to believe there is a large minority who are not. This minority is often identified with a particular social group (the Irish; inner-city African Americans; etc.). In such cases, the public order aspect of policing will disproportionately be directed at these groups. The (usually unspoken) fear is that if this surveillance is removed, the disorderly minority will erupt. Fortunately, we have historical evidence demonstrating that this is not so. 

One way to corroborate this claim is to look at police strikes, which offer a kind of natural experiment: If police stop working, we can see whether it leads to a sudden spurt of opportunistic predation and lawlessness. The answer is sometimes yes—but only on a small scale—and in most cases not at all.

In 1853, there was a series of what were effectively strikes by police forces in towns in the North of England, including Manchester, Hull, and Preston. In Manchester, two-thirds of the police simultaneously resigned. It took weeks for the dispute to be resolved. Until it was, there was no effective police force in the city, yet crime did not increase. The same pattern was found in the other Northern towns such as Hull and Preston.

A whole series of police strikes occurred in various U.S. cities between 1967 and 1983. These included walk-outs in Detroit, New York, Baltimore, San Francisco, Cleveland, New Orleans, and Milwaukee—plus no fewer than 10 separate disputes in Cook County, Illinois. In several of these, the strike lasted for several days or longer. None saw a significant increase in crime, according to contemporaneous news reports. 

In New York in 1971, according to the Associated Press, “there has been no apparent rise in crime since the walkout.” In New Orleans in 1979, “there was no apparent increase in crime during the walkout.” In San Francisco in 1975, “the strike left the city short of protection, but no major upswing in crime was reported.” In Toledo, Ohio, in 1975, “the first day of the walkout passed without reports of violence in this city of 370,000 persons.” And in Cleveland in 1978, “the strike had no immediate effect on the city, except for flocks of prostitutes who openly flaunted their wares in the muggy summer weather—even stepping into the streets to flag down passing motorists.”

There have been strikes that were associated with looting, such as Melbourne, Australia, in 1923 and Liverpool, England, in 1919. But this was limited: No general increase in crime resulted. 

Order is what makes a free society possible. But there are many ways of preserving order and protecting persons and property that do not require a centralized police force, much less the aggressive paramilitary-style policing that has become so common in the United States. In the U.K., prior to the County and Borough Police Act (which made local police departments compulsory in 1857), many areas did not have a paid public police force. Instead, they relied on action by private individuals (under the terms of the 1285 Statute of Winchester) or collective voluntary action by locals, through “associations for the prosecution of felons.” They did not experience crime or disorder at higher levels than areas that did have police. 

Society needs a dedicated professional organization to investigate and deal with serious and organised crime, as advocates of “defunding the police” generally acknowledge. These tasks, however, are only a small part of what police departments do. Many of the offenses dealt with by police are nonviolent activities, such as drug use, that criminal law should have no say over. Other tasks—like maintaining orderly behavior in public places and enforcing traffic rules—do not require an armed force with powers of arrest. Mental health, domestic abuse, and neighborhood nuisance calls are better dealt with using health care and social work professionals and the civil courts.

The police clear-up rate for minor crimes such as burglary, theft, and criminal damage is staggeringly low. This is not surprising: Officers face a very acute knowledge problem, since the information they need is tacit and dispersed among the people in a locality. Rather than expecting a professional bureaucracy to be able to ferret it out, it makes more sense to have a community organization that draws upon and pools local information, involving the people most directly affected by the disorderly conduct of a minority of individuals. 

Proposals for defunding American police departments grow out of an increasing impatience with the type of policing that is predominant in the United States. Despite the knee-jerk resistance, this is not an unreasonable idea, and effecting it in a measured way would not—as far as we can tell from recent and historical evidence—lead to a violent explosion of the kind that many fear. Some police officers are talking of resorting to strike action in response to the defunding proposals. The record suggests this could help people realize how little they’re actually needed.

from Latest – Reason.com https://ift.tt/3j7Qyrm
via IFTTT

It’s time to rethink the Hong Kong dollar

In 221 BC, the 38-year emperor Qin Shi Huang declared total victory against all of his rivals in northern China.

Qin’s ancestors had literally spent centuries invading neighboring states and engaging in complex diplomacy in order to unify China into a single empire.

And Qin Shi Huang was the first Emperor to rule over the unified China that his ancestors had worked so long to build. Talk about having a long-term view.

But instead of celebrating his military success and enjoying peace, Qin decided to expand his empire even further. He focused his attention on the fertile, tropical lands south of the Yangtze River… and sent a massive army of 500,000 men to seize the region.

Among Qin’s new conquests was a small peninsula where the Pearl River flows into the South China Sea.

Today we call this area Hong Kong.

Hong Kong really rose to prominence more than 1,000 years later when invading Mongols ripped through China in 1276 AD.

The imperial family of the Song Dynasty knew they would be executed by the Mongols… so they relocated to Hong Kong’s Lantau Island.  Countless refugees followed, fleeing the Mongols for Hong Kong.

So even more than seven centuries ago, Hong Kong was part of people’s Plan B.

This continues to be the case today; Hong Kong has long been among the world’s most prosperous and free jurisdictions. And even people who don’t live, work, or do business in Hong Kong have been able to benefit from its stability and economic freedom.

One of those ways has been through its currency– the Hong Kong dollar.

Hong Kong’s currency has been ‘pegged’ to the US dollar since 1983 at a rate of 7.80 Hong Kong dollars per US dollar, plus/minus a very tiny range of less than 1%.

This policy has effectively made Hong Kong dollars completely interchangeable with US dollars. And Hong Kong actually has the ability to back it up.

Plenty of other countries have tried (and failed) to peg their currencies to the US dollar. They do this create stability– having a currency that’s interchangeable with US dollars makes it easier to attract foreign investment because the peg eliminates currency risk.

Problem is– most places can’t back it up.

When a government or central bank pegs its currency to the US dollar, they need to be willing and able to exchange US dollars for their currency. And obviously this policy requires having a stockpile of US dollars in reserve.

Most countries that try to peg their currencies do not have this stockpile of US dollar reserves. Argentina, for example, pretended to peg its currency to the US dollar back in the 1990s.

It was a total disaster.

Argentina didn’t have enough dollars in reserve to actually make good on the peg. And before long, the arrangement (along with Argentina’s economy) collapsed.

But Hong Kong actually DOES have the reserves.

Hong Kong’s US dollar reserves are so vast that they could literally buy back every single Hong Kong dollar in circulation, and still have plenty of savings left over.

This is practically unheard of when it comes to pegged currency arrangements. So Hong Kong’s dollar is truly the real deal.

This is one of the reasons why I’ve long favored it, especially as part of a sensible Plan B.

For US dollar-based businesses and individuals, Hong Kong’s dollar represented all the good parts of the US dollar, but none of the downsides.

Think about it: the US dollar is backed by a government that has $26.6 trillion in debt. Hong Kong is practically debt-free. Yet these two currencies are worth almost exactly the same.

So clearly, between the two, the Hong Kong dollar was a safer choice.

But I don’t believe that’s still the case.

In the last few months, we’ve seen a minor trade dispute between the US and China escalate into a full-blow Cold War, resulting in sanctions, arrests, and asset freezes on both sides.

More importantly, China has now squashed any illusion of Hong Kong sovereignty.

Even though Hong Kong is supposed to remain autonomous for several more decades, mainland China’s government has taken over Hong Kong’s political and economic policymaking.

I do not find it coincidental that China began its most aggressive power grab in Hong Kong around the same time that tensions between the US and China began to rise.

So at this point, Hong Kong’s dollar is pegged to the US dollar. China has taken over Hong Kong. And the US and China are quickly becoming bitter enemies.

With these conditions, I don’t believe we can count on the stability we’ve seen over the past several decades when it comes to the Hong Kong dollar peg.

Quite simply, there’s no rational reason for the two currencies to be pegged anymore. Hong Kong is not some frontier market like central Africa that needs the stability of the peg.

Hong Kong is a wealthy, advanced economy. And it’s far more connected to China than the US.

So with tensions flaring between China and the US flaring, the peg may be a casualty of the Cold War.

Sure, it’s possible that nothing happens. China could decide to leave the Hong Kong dollar alone… or gradually re-peg it to a basket of other currencies.

But China could also decide to re-peg the Hong Kong dollar to its own currency, the renminbi. Or to seize a portion of Hong Kong’s US dollar reserves and devalue the Hong Kong dollar.

And it’s not only China. Just a few weeks ago, the US government threatened to break the Hong Kong dollar peg.

Now, those were just idle (and silly) threats. But the point is that there are several uncertainties today that did not exist even a few weeks ago. And those uncertainties may result in change to the peg.

Keep this in mind if you hold Hong Kong dollars: you might not be able to count on that stable exchange rate.

Source

from Sovereign Man https://ift.tt/3j8sc0t
via IFTTT

No Qualified Immunity for Kentucky Cops Who Strip-Searched a 4-Year-Old and Threatened Mom

Good news, parents: If you let your kids wait in the car for less than 10 minutes on a cool day—doors locked and fan on—a caseworker and sheriff are actually not allowed to come to your home, threaten to take your children away, and strip search the kids.

These very basic rights were just vindicated the hard way: by a Kentucky mom in federal court. Holly Curry sued the cop and the caseworker, insisting that the day she was investigated for child abuse, the two authorities so overstepped their bounds that they should not be afforded qualified immunity. In other words, their behavior was so egregious, they had to take responsibility for it. The judge agreed.

You may recall the case. Back in March of 2017, Curry was driving her kids to karate when she stopped to get them some muffins. She was in the café for just a few minutes. When she came out, two cops rebuked her for leaving the kids.

In Kentucky, it’s a crime to leave children under the age of eight in a car under circumstances that “manifest an extreme indifference” to human life and create a grave risk of death. But the cops didn’t say she’d done that. The kids all looked fine, and they the officers left without charging Curry with a crime. Nevertheless, they felt obligated to call the state’s child protection hotline, thus opening a neglect investigation which automatically required a visit to the Curry home to check on the kids.

When the caseworker arrived at the home, Holly refused to let her in without a warrant. The worker returned with a sheriff’s deputy, but still no warrant. When Holly insisted that they still couldn’t enter, they threatened to “come back and put your kids into foster care.” Holly begged for time to call her husband. They refused. Finally, crying and terrified, Holly let them in.

Labeling that decision “voluntary consent,” the authorities entered the home. Unsurprisingly, the house and kids all looked fine. Even so, the caseworker insisted on strip searching each kid, removing their underwear and examining their genitals for signs of abuse.

A few months later, the caseworker closed the investigation as “unsubstantiated,” saying that what Holly had done was a “one-time ‘oopsy-daisy.'” But she telephoned Curry later and said, “If we ever get a call against your family again, bad things will happen to you, and we’ll take your children.”

At that point, Curry had had enough. She turned around and filed suit against the caseworker and cop, claiming violation of her constitutional rights.

They, in turn, pressed hard for immunity. But in in a powerful ruling on August 19 in Curry v. Kentucky Cabinet for Health and Human Services, Judge Justin Walker said that it was clear the government used an improper threat to enter the home, lacked any evidence that might have justified a strip search, and violated the children’s rights to bodily integrity. According to Walker:

Act One: An “attentive and loving” mother gets muffins for her children. Act Two: There’s a knock on her door and a threat by the government to take away her children. Act Three: Her children are strip searched without cause. America’s founding generation may never have imagined a Cabinet for Health and Family Services. But they knew their fair share of unwelcome constables. And they added a Fourth Amendment to our Constitution to protect against this three-act tragedy.

To enter a home without consent and examine stripped kids requires a warrant, genuine suspicion of abuse, or an actual emergency. Who knew? Apparently not the authorities in Kentucky, who have been defending the warrantless entry and strip ever since the Curry’s filed their lawsuit in 2018.

Assuming the decision stands, “it’s very good news for child welfare and police reformers,” says Diane Redleaf, co-chair of United Family Advocates and Let Grow’s legal consultant.

“It’s also welcome news for all the parents who want to give their kids some unsupervised time—to walk to school, to come home with a latchkey, to wait briefly in the car—but fear what could happen to them if an onlooker decided to call 911,” says Redleaf.

The Currys are home schoolers who enlisted James R. Mason, executive director of the Home School Legal Defense Association, to file the federal suit on their family’s behalf. Mason hopes that now the authorities will think twice before barging into homes and strip searching kids without evidence of wrongdoing by the parent. The investigator in the case testified that they “automatically strip search every child when they go into a home,” Mason notes. “No more.”

from Latest – Reason.com https://ift.tt/2Yr945V
via IFTTT

What About…Defunding the Police?

Defund the Police

In this month’s issue, we draw on decades of Reason journalism about policing and criminal justice to make practical suggestions about how to use the momentum of this summer’s tumultuous protests productively. Check out Damon Root on abolishing qualified immunity, Peter Suderman on busting the police unions, Jacob Sullum on ending the war on drugs, Sally Satel on rethinking crisis response, Zuri Davis on restricting asset forfeiture, C.J. Ciaramella on regulating use of force, Alec Ward on releasing body cam footage, Jonathan Blanks on stopping overpolicing, and Nick Gillespie interviewing former Reasoner Radley Balko on police militarization.

The current wave of protest in the United States since the death of George Floyd has gone beyond familiar demands for changes in police tactics and punishments for officer misconduct to something altogether more radical. Increasingly, the goal is for police departments in major cities to be “defunded.” At the very least, this would mean a serious rethinking of the current model of American policing and a significant redirection of public spending to other ends. In its more extreme variants, it would mean much more: a move away from the very idea of a public police force, uniformed, permanent, paid for through taxation, and possessed of powers not enjoyed by ordinary citizens.

This would not just represent a change in policing methods and the pattern of government spending; it would be a revolutionary rejection of what for 200 years has been a core capacity and function of the modern state. The immediate response of most to this idea is that abolishing the existing system in this way would lead to an explosion of criminality and violence. The underlying belief is that it is only the active presence of a police force of the kind we are familiar with that stops such an explosion from happening. But history and modern criminology suggest otherwise. 

Calls to defund the police are being made across the United States. In Minneapolis, where the current wave of protests began, the City Council’s majority has committed to a strategy, already advocated by some local community organizations, of a version towards the radical end of the suggestions. In Los Angeles, the suggestion is to reduce the city’s police budget from 51 percent of general fund spending to 5.7 percent.

The push for defunding has been triggered by specific incidents and growing frustration at a trend involving deaths at the hands of police officers following arrests or confrontations over minor matters. However, that particular concern derives from a more general discontent (also growing) with the way the entire policing and law enforcement system works. This critique has several aspects. The first is simply the cost of policing in contemporary America. A recent report calculated that total annual police department spending in the U.S. amounts to $115 billion. In Minneapolis, police spending accounts for 30 percent of the total budget. In Los Angeles, the 51 percent of spending accounted for by the Los Angeles Police Department (LAPD) comes to $1.8 billion a year. These are not small amounts—and the cost has been rising steadily even as crime has been declining sharply since the middle of the 1990s.

The discontent goes beyond mere cost, however. It relates to the whole style and philosophy of policing on display in most U.S. metropolitan areas and beyond. As The Washington Post‘s Radley Balko has pointed out, the last few decades have witnessed a militarization of U.S. policing to the point where large urban police forces are equipped like, and too often behave like, an occupying army (without the military training). This has much greater consequences because of two other developments, which in turn grow out of the philosophy and vision that has driven much U.S. policing since its creation in the mid–19th century. 

The first development is the use of the police as an agency for moral and social policy. This includes enforcing the laws against nonviolent, consensual crimes (e.g., the war on drugs) and dealing with local community or public health problems (e.g., mental health issues and domestic abuse). The second development is the growth of “broken windows” policing, a strategy where officers aggressively address minor infractions of the law, such as vandalism, often with maximal force. This is the contemporary version of “proactive” or “preventative” policing, a strategy that has been tried in places around the world since it was first advocated at the end of the 18th century—virtually always with bad results. This kind of policing brings militarized police officers into regular contact with members of the public. Not a random selection of the public, though; members of disadvantaged groups (typically African Americans and other minorities, but also poor whites) are disproportionately affected. This in turn leads to often violent confrontations and a policing policy that, instead of preserving public order and safeguarding communities, actively disrupts order and escalates violence in communities.

What does “defunding” mean in practical terms? One consistent element is that much current spending on police should be redirected elsewhere. The more moderate proposals call for either large cuts to existing budgets or for the existing department to be replaced by a new and smaller one (with different personnel). The most radical idea is that the entire police system should be scrapped and replaced by some other mechanisms for maintaining public order. Importantly, different entities (either public or private) would be tasked with dealing with minor rules infractions on the one hand and handling serious or violent crime on the other. This idea calls the whole notion of policing as a central function of the state into question.

The immediate response to these ideas, and particularly the last one, is often that they are preposterous. Most people believe that getting rid of the police force in its present form would lead to immediate chaos. Advocates of defunding are at pains to explain that they are talking not about shutting down departments overnight but about a process to redefine the policing function, with one method of maintaining social order replaced by another. Yet these explanations tend to fall on deaf ears. 

One reason has to do with widespread beliefs that serious crime is much more prevalent than it really is and that dealing with it is the main function of a police force. Neither is true. Pew Research Center reports that 60 percent of the American public believes crime is higher today than a year ago, even though FBI and Bureau of Justice Statistics data show that it has been declining steadily since 1993. Meanwhile, studies have consistently found that police spend only about one-fifth of their time dealing with actual crime.

Because the actual main purpose of the uniformed police is enforcing rules and maintaining order in public places, these misconceptions can have knock-on effects. For the most part, people recognize that most of their peers are law-abiding and peaceful, but they also tend to believe there is a large minority who are not. This minority is often identified with a particular social group (the Irish; inner-city African Americans; etc.). In such cases, the public order aspect of policing will disproportionately be directed at these groups. The (usually unspoken) fear is that if this surveillance is removed, the disorderly minority will erupt. Fortunately, we have historical evidence demonstrating that this is not so. 

One way to corroborate this claim is to look at police strikes, which offer a kind of natural experiment: If police stop working, we can see whether it leads to a sudden spurt of opportunistic predation and lawlessness. The answer is sometimes yes—but only on a small scale—and in most cases not at all.

In 1853, there was a series of what were effectively strikes by police forces in towns in the North of England, including Manchester, Hull, and Preston. In Manchester, two-thirds of the police simultaneously resigned. It took weeks for the dispute to be resolved. Until it was, there was no effective police force in the city, yet crime did not increase. The same pattern was found in the other Northern towns such as Hull and Preston.

A whole series of police strikes occurred in various U.S. cities between 1967 and 1983. These included walk-outs in Detroit, New York, Baltimore, San Francisco, Cleveland, New Orleans, and Milwaukee—plus no fewer than 10 separate disputes in Cook County, Illinois. In several of these, the strike lasted for several days or longer. None saw a significant increase in crime, according to contemporaneous news reports. 

In New York in 1971, according to the Associated Press, “there has been no apparent rise in crime since the walkout.” In New Orleans in 1979, “there was no apparent increase in crime during the walkout.” In San Francisco in 1975, “the strike left the city short of protection, but no major upswing in crime was reported.” In Toledo, Ohio, in 1975, “the first day of the walkout passed without reports of violence in this city of 370,000 persons.” And in Cleveland in 1978, “the strike had no immediate effect on the city, except for flocks of prostitutes who openly flaunted their wares in the muggy summer weather—even stepping into the streets to flag down passing motorists.”

There have been strikes that were associated with looting, such as Melbourne, Australia, in 1923 and Liverpool, England, in 1919. But this was limited: No general increase in crime resulted. 

Order is what makes a free society possible. But there are many ways of preserving order and protecting persons and property that do not require a centralized police force, much less the aggressive paramilitary-style policing that has become so common in the United States. In the U.K., prior to the County and Borough Police Act (which made local police departments compulsory in 1857), many areas did not have a paid public police force. Instead, they relied on action by private individuals (under the terms of the 1285 Statute of Winchester) or collective voluntary action by locals, through “associations for the prosecution of felons.” They did not experience crime or disorder at higher levels than areas that did have police. 

Society needs a dedicated professional organization to investigate and deal with serious and organised crime, as advocates of “defunding the police” generally acknowledge. These tasks, however, are only a small part of what police departments do. Many of the offenses dealt with by police are nonviolent activities, such as drug use, that criminal law should have no say over. Other tasks—like maintaining orderly behavior in public places and enforcing traffic rules—do not require an armed force with powers of arrest. Mental health, domestic abuse, and neighborhood nuisance calls are better dealt with using health care and social work professionals and the civil courts.

The police clear-up rate for minor crimes such as burglary, theft, and criminal damage is staggeringly low. This is not surprising: Officers face a very acute knowledge problem, since the information they need is tacit and dispersed among the people in a locality. Rather than expecting a professional bureaucracy to be able to ferret it out, it makes more sense to have a community organization that draws upon and pools local information, involving the people most directly affected by the disorderly conduct of a minority of individuals. 

Proposals for defunding American police departments grow out of an increasing impatience with the type of policing that is predominant in the United States. Despite the knee-jerk resistance, this is not an unreasonable idea, and effecting it in a measured way would not—as far as we can tell from recent and historical evidence—lead to a violent explosion of the kind that many fear. Some police officers are talking of resorting to strike action in response to the defunding proposals. The record suggests this could help people realize how little they’re actually needed.

from Latest – Reason.com https://ift.tt/3j7Qyrm
via IFTTT

“Main Street Is Struggling Severely” – Nouriel Roubini Warns Wall Street Euphoria Ignores Main Street Crash

“Main Street Is Struggling Severely” – Nouriel Roubini Warns Wall Street Euphoria Ignores Main Street Crash

Tyler Durden

Mon, 08/24/2020 – 10:20

Speaking on Bloomberg Television Friday, Nouriel Roubini warned the stock market is completely disconnected from the dire economic outlook of a waning recovery amid continued depressionary pressures. 

Roubini told “Bloomberg Surveillance” the global economy is slowing, and another downturn could be ahead if a vaccine is not found in short order. 

h/t Bloomberg TV 

He said the shape of the recovery is transforming from a “V” and is “becoming a U and the U could become a W if we don’t find a vaccine and don’t have enough stimulus.”

Roubini, the chief executive of Roubini Macro Associates Inc., said the recovery on Wall Street doesn’t reflect the real economy:

 “Main Street is struggling,” he said.

Roubini said Europe’s policies to protect workers are much more robust than the U.S., where tens of millions of folks are jobless, hungry, and face eviction. 

“The European system of greater social cohesion gives you better economic outcomes than the one of the United States that is just Wild West capitalism,” he said.”That’s why the unemployment rate barely went up in Germany or even in Italy, while in the U.S. we’ve had double-digit unemployment rate and actually even worse, considering underemployment and so on.”

Jobs data this week showed the U.S. labor market recovery continues to reverse. Another million Americans filed for jobless benefits last week, back above one million and up notably from the 971k (revised higher) last week, and notably worse than the 920k expected…

The Federal Reserve’s minutes on Wednesday from its July meeting highlighted doubts about the “V-shaped” recovery, showing that the swift labor market rebound seen in May and June had likely slowed. Quoting Rabobank’s global strategist Michael Every, he told clients: “Of course, the Fed agreed that the virus is weighing heavily on the economy: is that some kind of surprise? Apparently, it was.”

While it was a surprise to many on Wall Street who have turned a blind eye to the utter destruction of the labor market and small businesses, the Fed’s monetary cannon has injected trillions of dollars into the economy markets to reinflate asset prices and distract everyone from the worst economic crash since the Great Depression in the 1930s.

The party on Wall Street, driven by liquidity via central banks has reinflated financial assets to nosebleed valuations as the labor market implodes.  

The party on Wall Street is also concentrated in a handful of technology stocks, about five to be exact. If Facebook, Amazon, Apple, Microsoft, and Google were removed from the S&P500 index, the overall main equity index would be flat on the year, as opposed to +35%.

As for the rest of the world, a resurgence of coronavirus across the Asia Pacific, Europe, and the U.S. have stalled the global recovery. The risk now is the world economy slumps in the back half of the year. 

The consequence of central banks saving Wall Street at the expense of main street will result in widening wealth inequality to unimaginable levels that will continue to lead to a socio-economic implosion of the middle class. 

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

As More Children Learn From Home, The State Is Cracking Down On ‘Virtual Truancy’

As More Children Learn From Home, The State Is Cracking Down On ‘Virtual Truancy’

Tyler Durden

Mon, 08/24/2020 – 10:00

Authored by Kerry McDonald via FEE.org/The Libertarian Institute,

As remote learning creates more distance between school districts and students, school and state officials are clinging to control however they can. From sending Child Protective Services (CPS) agents to investigate charges of neglect in homes where children missed Zoom classes last spring, to proposing “child well-being checks” in homes this fall, government schools and related agencies are panicking over parents having increased influence over their children’s care and education during the pandemic.

A front page article in Boston Sunday Globe days ago describes the experiences of several parents who were interrogated by CPS agents last spring when their children missed remote classes or failed to submit homework assignments amidst pandemic-related school shutdowns. Some parents didn’t have Internet access and were blindsided by the CPS investigations of “virtual truancy.” One Latina mother featured in the Globe story is Em Quiles, who, like many parents last spring, scrambled to care for her children and continue to work during tremendous upheaval and uncertainty.

Truancy court file image

According to the Globe:

Then in June, Quiles was stunned to receive a call from the state’s Department of Children and Families. The school had accused Quiles of neglect, she was told, because the 7-year-old missed class and homework assignments.

“I couldn’t believe it,” she said.

Quiles lived one of the worst nightmares for a parent: A neglect charge, if substantiated, can lead to removing a child from their home.

While most of the parents featured in the Globe story were ultimately exonerated, previous interaction with CPS, even if unfounded, can act as a Scarlet Letter for parents, haunting them for years to come. More troubling, parents singled out for CPS enforcement are disproportionately low-income and minority, often lacking the resources to defend themselves against government overreach. According to the Globe: “Most of the families caught up in remote learning allegations are Latino or Black, groups that are likely to be overrepresented in state foster care at all times.”

School districts across the country have a history of activating CPS against parents who stray from a district’s command and control. An in-depth 2018 investigative report by The Hechinger Report and HuffPost revealed that schools increasingly use child protective services as a “weapon against parents” — especially parents who lack the means to fight back.

Kamala Harris: “We Are Putting Parents On Notice”

Truancy has long been a trigger for CPS investigations, and now virtual truancy seems poised to accelerate these practices during the pandemic. This is particularly concerning because, just as in typical truancy cases, virtual truancy is often prompted by factors other than parental neglect. Special needs students and students with disabilities or health conditions may have more school absences, and they may find virtual learning to be uniquely challenging. A 2019 HuffPost article entitled The Human Costs of Kamala Harris’ War on Truancy, found that strict truancy laws and enforcement terrorized families, with parents being pulled out of their homes in handcuffs and sent to jail.

Cheree Peoples, one of the parents spotlighted in the HuffPot piece, whose daughter missed school frequently due to sickle cell anemia, was awakened in the early hours by police officers who arrested her for truancy. She told the HuffPost: “You would swear I had killed somebody.”

The HuffPost article, revealed that then Democratic presidential candidate and now the presumptive Democratic vice presidential nominee, Kamala Harris, was responsible for much of the heightened aggression toward parents regarding truancy. As California’s attorney general, Harris was a crusader against truancy and was instrumental in toughening criminal prosecution of parents whose children missed too much school. According to HuffPost, Harris “persuaded the state legislature to adopt harsher penalties for truancy. Under the new law, the parent or guardian of a young, truant child could face a fine of $2,500 or more — or one year in jail. Harris pushed hard for the law as she was running for attorney general, and it passed just as she won the election. ‘We are putting parents on notice,’ Harris said at her 2011 inauguration.”

Proposed Child Wellbeing Checks During COVID-19

Criminal investigations of child neglect tied to virtual truancy are set to skyrocket this fall, as school districts across the country adopt remote learning plans. Worried that parents can’t be trusted to care for their own children, some education officials have proposed large scale “child well-being checks,” by government agents. Earlier this month, the Tennessee Department of Education announced that it would be performing these well-being checks on children across the state. This plan created such an uproar among Tennessee parents and conservative lawmakers that the proposed initiative was withdrawn and its guidelines removed from the education department’s website.

Despite this immediate victory, all parents should remain on alert. School and state officials, aided by high-profile academics, will likely seek to increase CPS involvement in family affairs during remote learning and beyond. Elizabeth Bartholet, the Harvard Law School professor who made headlines last spring when she called for a presumptive ban on homeschooling, spoke out last week in favor of increased CPS action this fall. In an interview with Harvard Law Today, Bartholet said: “My overall general recommendation is that educators and CPS agencies need to recognize the level of problems that kids at home are now facing in terms of risk of both education and maltreatment, and come up with some creative new solutions.”

In the interview, Bartholet acknowledged the heightened interest in independent homeschooling, as more parents choose to forgo district learning this fall and consider separating from their school district going forward. According to Bartholet: “Roughly three percent of the population is now homeschooled. Let’s say that increases to six percent post-COVID. Legislators and other policymakers may look at that and say, ‘Wow, now this is a big phenomenon, it may continue to grow. Of course, it shouldn’t be just this lawless world out there with no rules and regulations and oversight. Of course, this should be part of our overall regulated educational system.’”

As I’ve written previously, homeschooling should not be part of the overall regulated education system. It is a form of private education that is separate and distinct from state schooling, and many parents are now finding that they prefer homeschooling over other education options. Parents are pulling their children out of school this fall in record numbers, dissatisfied with school reopening plans and aiming for greater educational freedom and flexibility. So many parents submitted online intent to homeschool forms in North Carolina last month that it crashed the state’s nonpublic education website. Perhaps not surprisingly, a recent report by a law professor at North Carolina’s Duke University called for greater regulation and oversight of the state’s growing ranks of homeschoolers.

As parents pull away from state-controlled education and assume greater responsibility for their children’s learning, the state will hasten efforts to maintain and expand its authority through its monopoly on the use of force. From virtual truancy claims and increased CPS investigations that disproportionately target poor parents and families of color, to calls for child well-being checks and more homeschooling regulations, the state will not willingly yield control of children’s education to parents.

Parents should strongly reject these heavy-handed efforts to interfere with family life during and after the pandemic, and be especially vigilant about helping low-income and minority parents to resist as well. Minimizing state power while maximizing individual liberty is the hallmark of a free society. Now more than ever, parents are exercising and securing their freedom to raise and educate their children as they choose. Parents may have been put on notice, but they are pushing back and opting out.

via ZeroHedge News https://ift.tt/2EoHwr7 Tyler Durden

Private Equity Will Soon Know Which Of Your Ancestors Owned Slaves

Private Equity Will Soon Know Which Of Your Ancestors Owned Slaves

Tyler Durden

Mon, 08/24/2020 – 09:45

With Main Street still largely in disarray, despite the billions of dollars left in Fed-backed lending programs for small and medium-sized businesses and Ice Cube asking “where’s our f**king bailout?”, we imagine the millions of newly impoverished Americans can appreciate the fact that America’s jet-setting private equity barons are still doing their thing. After all, a pandemic is trivial compared with Steve Schwarzman’s insatiable lust for more – more assets, more capital, more recognition.

As America’s obsession with race and lineage intensifies thanks to the left’s embrace of ‘identity politics’, Schwarzmann has found a clever way to cash in on this trend, by paying top dollar for Ancestry.com. In a $4.5 billion deal – a staggering number, especially considering that Silver Lake and Singapore’s Sovereign Wealth Fund acquired their majority stake for just $2.6 billion 4 years ago.

Though GIC will retain a significant minority stake, the deal appears to be a play for a quick IPO turnaround (though they may need to move quickly).

Since Blackstone is buying a relatively mature company with a huge marketing budget and a DNA network of 18 million people, we suspect Schwarzman’s plan is to pray that the market holds up (we’ll see what his buddy Jerome Powell has to say about that during his virtual Jackson Hole speech), at least long enough for Blackstone to take Ancestry.com public, and saddle retail investors with any long-term losses.

According to Blackstone’s press shop, the deal will be the first acquisition of the “largest ever private equity fund” which was recently raised by the $564 billion AUM asset manager, leaving it flush with cash during a period of market frenzy utterly at odds with the underlying economic fundamentals.

Bloomberg reports that deal talks regarding Ancestry.com started a few months ago when much of the world was still at home and looking for things to do, which increased the appeal of its by-mail business, which saw a boost in traffic.

We can see a slightly more sinister side to the deal: Pretty soon, Schwarzman & Co. will know which Americans’ ancestors owned slaves, and which did not.

Read the press release below:

* * *

New York, August 5, 2020 – Blackstone (NYSE:BX) today announced that private equity funds managed by Blackstone (“Blackstone”) have reached a definitive agreement to acquire Ancestry® from Silver Lake, GIC, Spectrum Equity, Permira, and other equity holders for a total enterprise value of $4.7 billion. Current Ancestry investor GIC will continue to retain a significant minority stake in the company. This transaction represents the first control acquisition for Blackstone’s eighth vintage of its flagship private equity vehicle.

Ancestry is the global leader in digital family history services, operating in more than 30 countries with more than 3 million paying subscribers across its Ancestry online properties and more than $1 billion in annual revenue. The company harnesses the information found in family trees and historical records to help people gain a new level of understanding about their lives. Ancestry also operates a market-leading consumer genomics business, which informs consumers about their heritage and key health characteristics.

David Kestnbaum, a Senior Managing Director at Blackstone, said: “We are very excited to partner with Ancestry and its management team. We believe Ancestry has significant runway for further growth as people of all ages and backgrounds become increasingly interested in learning more about their family histories and themselves. We look forward to investing behind further data, functionality, and product development across Ancestry’s market leading platform to continue to provide a differentiated service. Our investment is a prime example of Blackstone’s continued, high-conviction focus on investing in growing, digital consumer businesses, which are resilient in the current environment and beyond.” Sachin Bavishi, a Managing Director at Blackstone, added: “Ancestry’s large network of highly engaged users, unique content, and scaled technology platform have made it a market leader. We look forward to contributing Blackstone’s resources and leveraging our strong expertise in digital content to further accelerate Ancestry’s growth.”

Margo Georgiadis, President and Chief Executive Officer of Ancestry, said: “Our entire leadership team is thrilled to have the opportunity to partner with Blackstone to further accelerate Ancestry’s global leadership in family history and consumer genomics, and to help us achieve our mission to empower journeys of personal discovery to enrich lives. Looking ahead, in collaboration with Blackstone, we will continue to leverage our unique content, powerhouse consumer brand and technology platform to expand our global Family History business while bringing to life our long-term vision of personalized preventive health.” Howard Hochhauser, Ancestry’s Chief Financial Officer and Chief Operating Officer, added: “We want to thank Silver Lake, GIC, Spectrum Equity and Permira for their support in helping set up Ancestry for our next phase of growth.” Stephen Evans and John Rudella, Managing Director and Director at Silver Lake, respectively, said: “We thank Ancestry’s management team, employees, and our co-investors on the board including GIC and Spectrum, as well as our Board Chairman Tim Sullivan, for their partnership during a period characterized by impressive growth, accelerating technology innovation and expansion across new products. We will be cheering on from the sidelines going forward, and hope and expect that the company will achieve continued success under Blackstone’s ownership.”

Choo Yong Cheen, Chief Investment Officer of Private Equity at GIC, said: “Ancestry is the clear leader in helping people discover, preserve, and share their family histories. As a long-term investor, we are proud to have contributed to Ancestry’s family history mission since 2012, and we are confident the team will continue to innovate for years to come. We appreciate the contributions of Silver Lake, Permira, and Spectrum and look forward to partnering with the Blackstone and Ancestry teams for this next phase of growth.”

Morgan Stanley & Co. LLCserved as lead financial advisor to Ancestry. Barclays also served as a financial advisor to Ancestry. Latham & Watkins LLP is serving as legal advisor to Ancestry and Simpson Thacher & Bartlett LLP is serving as legal advisor to Blackstone. Dechert LLP is serving as legal advisor to GIC.Committed debt financing for the transaction was provided by Bank of America and Credit Suisse.

* * *

Source: Blackstone

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

VIX ‘Mini’ Flash-Crash, Small Caps Collapse, Retail Traders Marooned On App Outages

VIX ‘Mini’ Flash-Crash, Small Caps Collapse, Retail Traders Marooned On App Outages

Tyler Durden

Mon, 08/24/2020 – 09:44

After all major indices rose almost tick for tick overnight following the COVID treatment headlines, the cash market open has seen a very aggressive flush in Small Caps (into the red) and bid for Nasdaq as the growth/value rotation accelerates hard…

This follows some malarkey in VIX this morning that saw a mini-flash-crash around 0800ET…

Additionally retail investors are marooned…

  • Robinhood is having problems since 9:41 AM EDT – DownDetector

  • TD Ameritrade is having problems since 9:33 AM EDT – DownDetector

How much longer can this farce continue?

via ZeroHedge News https://ift.tt/2Et6Lbx Tyler Durden

Key Events In The Coming Week: All Eyes On Jackson Hole

Key Events In The Coming Week: All Eyes On Jackson Hole

Tyler Durden

Mon, 08/24/2020 – 09:29

With earnings season now over, looking at the week ahead the highlight will be the Jackson Hole gathering on Thursday and Friday, where central bankers will be meeting (virtually this year) for the annual economic symposium. This theme this year is “Navigating the Decade Ahead: Implications for Monetary Policy”, and one of the key highlights will be Fed Chair Powell’s speech on Thursday on the topic of the monetary policy review. As DB’s Henry Allen writes, the bank’s US economists note that while it’s possible that the policy review results will be released along with Powell’s appearance, they think it’s more likely that he summarizes the key findings and outlines the likely implications for the Fed moving forward. They think instead the review results won’t be released until the next meeting in mid-September. In addition to Powell, central bank watchers will have plenty of other speakers to look out for at the gathering, including Bank of England Governor Bailey, ECB chief economist Lane, and Bank of Canada Governor Macklem.

Turning to politics, attention will also be on the Republican National Convention taking place this week from Monday to Thursday, even if there aren’t likely to be as many market-moving headlines compared to Jackson Hole. Nevertheless, a CNN report said that President Trump would be appearing on every night of the convention, according to a Republican familiar with the convention planning, on top of his own speech planned for the Thursday night. So that could generate some news depending on the nature of any remarks. There are just over 10 weeks to go now until election day on November 3rd, and according to the polling averages, President Trump continues to lag behind Biden.

On the data side, we don’t have many top-tier releases with the US jobs report not until the following week. However, tomorrow will see both the Ifo’s business climate indicator from Germany, as well as the Conference Board’s consumer confidence from the US. The recent breakdown in fiscal negotiations in Congress could weigh on consumer attitudes, and DB economists see the number falling to 92.0 (vs. 92.6 in July).

Courtesy of Deutsche Bank, here is a day-by-day calendar of events:

Monday

  • Data: US Chicago Fed July National Activity Index
  • Politics: Republican National Convention begins

Tuesday

  • Data: Germany final Q2 GDP, August Ifo business climate, US June FHFA house price index, August Conference Board consumer confidence, July new home sales, August Richmond Fed manufacturing index
  • Central Banks: Fed’s Daly speaks
  • Earnings: Salesforce, Medtronic, Intuit, Autodesk

Wednesday

  • Data: US weekly MBA mortgage applications, preliminary July durable goods orders, nondefence capital goods orders ex air
  • Central Banks: ECB’s Schnabel and BoE’s Haldane speak
  • Earnings: Royal Bank of Canada

Thursday

  • Data: China July industrial profits, Japan June all industry activity index, final July machine tool orders, France August business confidence, Euro Area July M3 money supply, Italy June industrial sales, industrial orders, US second reading Q2 GDP, weekly initial jobless claims, July pending home sales, August Kansas City Fed manufacturing activity
  • Central Banks: Economic Symposium at Jackson Hole commences, Fed Chair Powell, Bank of Canada Governor Macklem and ECB’s Lane speak, Bank of Korea monetary policy decision
  • Earnings: Dollar General, HP
  • Politics: President Trump speaks at Republican National Convention

Friday

  • Data: Germany September GfK consumer confidence, France preliminary August CPI, final Q2 GDP, Italy August consumer confidence index, Euro Area final August consumer confidence, Canada June GDP, US July personal income, personal spending, advance goods trade balance, PCE deflator, preliminary July wholesale inventories, August MNI Chicago PMI, final August University of Michigan consumer sentiment index
  • Central Banks: Economic Symposium at Jackson Hole concludes, BoE Governor Bailey speaks

Finally, here is Goldman’s take on the key events in the US, where the key event this week is Fed Chair Jerome Powell’s speech at the Jackson Hole Economic Symposium. The key economic data releases this week are the durable goods report on Wednesday, the second Q2 GDP estimate on Thursday, and the personal income report on Friday.

Monday, August 24

  • There are no major economic data releases scheduled.

Tuesday, August 25

  • 09:00 AM FHFA house price index, June (consensus +0.3%, last -0.3%)
  • 09:00 AM S&P/Case-Shiller 20-city home price index, June (GS flat, consensus +0.10%, last +0.04%): We estimate the S&P/Case-Shiller 20-city home price index remained unchanged in June, following a 0.04% increase in May.
  • 10:00 AM Conference Board consumer confidence, August (GS 94.0, consensus 93.0, last 92.6): We estimate that the Conference Board consumer confidence index increased by 1.4pt to 94.0 August, as an improving virus situation and rising stock prices could boost confidence.
  • 10:00 AM New home sales, July (GS +2.5%, consensus +1.2%, last +13.8%): We estimate that new home sales rose by 2.5% in July, partly reflecting a boost from higher mortgage applications.
  • 10:00 AM Richmond Fed Manufacturing, August (consensus 10, last 10)
  • 03:25 PM San Francisco Fed President Mary Daly (FOMC non-voter) speaks: San Francisco Fed President Mary Daily will discuss inequity and Covid-19 in a virtual panel hosted by the Rotary Club of Oakland.

Wednesday, August 26

  • 08:30 AM Durable goods orders, July preliminary (GS +5.5%, consensus +4.5%, last +7.6%); Durable goods orders ex-transportation, July preliminary (GS +2.5%, consensus +1.7%, last +3.6%); Core capital goods orders, July preliminary (GS +2.5%, consensus +2.0%, last +3.4%); Core capital goods shipments, July preliminary (GS +2.5%, consensus +2.0%, last +3.3%): We expect durable goods orders to increase 5.5% in the preliminary June report, reflecting improvements in net aircraft orders. We expect a 2.5% increase in core capital goods orders, given the continued industrial rebound.

Thursday, August 27

  • 08:30 AM GDP, Q2 second (GS -31.6%, consensus -32.5%, last -32.9%); Personal consumption, Q2 second (GS -32.0%, consensus -34.6%, last -34.6%): We estimate the second estimate of Q2 GDP will show an upward revision to -31.6% (qoq ar), compared to -32.9% as reported in the advance release. The quarterly services survey revealed more resilience in consumer activity than the BEA assumed in the first vintage of Q2 GDP, with surprisingly modest weakness in healthcare services and personal and household services. Accordingly, we expect a 2.6pp upward revision to real consumption growth to -32.0%. Given the weakness in motion picture and music recording revenues, we look for a sizable downward revision to Q2 intellectual property investment.
  • 08:30 AM Initial jobless claims, week ended August 22 (GS 1,000k, consensus 1,000k, last 1,106k); Continuing jobless claims, week ended August 15 (consensus 14,400k, last 14,844k): We estimate initial jobless claims fell to 1000k in the week ended August 22.
  • 09:10 AM Fed Chair Powell (FOMC voter) speaks: Federal Reserve Chair Jerome Powell will deliver a speech titled “Monetary Policy Framework Review” at the Kansas City Federal Reserve Bank’s annual Economic Symposium in Jackson Hole, hosted as a virtual event. The topic of the conference this year is titled “Navigating the Decade Ahead: Implications for Monetary Policy.” Prepared text and media Q&A are expected. The event will be livestreamed.
  • 10:00 AM Pending home sales, July (GS +4.0%, consensus +2.0%, last +16.6%): We estimate that pending home sales increased by 4.0% in July based on regional home sales data, following a 16.6% surge in June. We have found pending home sales to be a useful leading indicator of existing home sales with a one-to-two-month lag.

Friday, August 28

  • 08:30 AM Personal income, July (GS +0.1%, consensus –0.4%, last -1.1%); Personal spending, July (GS +2.0% consensus +1.5%, last +5.6%); PCE price index, July (GS +0.40%, consensus +0.4%, last +0.37%); Core PCE price index, July (GS +0.45%, consensus +0.5%, last +0.20%); PCE price index (yoy), July (GS +0.98%, consensus +1.0%, last +0.75%); Core PCE price index (yoy), July (GS +1.24%, consensus +1.2%, last +0.95%): Based on details in the PPI, CPI, and import price reports, we forecast that the core PCE price index rose by 0.45% month-over-month in July, corresponding to a 1.24% increase from a year earlier. Additionally, we expect that the headline PCE price index increased by 0.40% in July, corresponding to a 0.98% increase from a year earlier. We expect a 0.1% increase in personal income in July and a 2.0% increase in personal spending.
  • 08:30 AM Advance goods trade balance, July (GS -$69.9bn, consensus -$72.2bn, last -$71.0bn): We estimate that the goods trade deficit decreased by $1.1bn to $69.9bn in July compared to the final June report, as both exports and imports likely rose further.
  • 08:30 AM Wholesale inventories, July preliminary (consensus -0.8%, last -1.4%)
  • 09:45 AM Chicago PMI, August (GS 51.9, consensus 52.5, last 51.9): We estimate that the Chicago PMI remained unchanged at 51.9 in August—following a 15.3pt increase in July—reflecting mixed manufacturing surveys so far in the month.
  • 10:00 AM University of Michigan consumer sentiment, August final (GS 73.0, consensus 72.8, last 72.8): We expect the University of Michigan consumer sentiment to edge 0.2pt higher from the preliminary estimate for August, in which the index rose 0.3pt. The report’s measure of 5- to 10-year inflation expectations increased by one-tenth to 2.7% in the preliminary report.

Source: Deustche Bank, Goldman, BofA

via ZeroHedge News https://ift.tt/31mBaRK Tyler Durden