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A Defense Witness Says the Cops Who Pinned George Floyd to the Pavement Were Not Using Force


Barry-Brodd-testifying-4-13-21-Newscom

The defense in Derek Chauvin’s murder trial yesterday presented testimony from a use-of-force expert who said the former Minneapolis police officer’s “interactions” with George Floyd “were following his training, following current practices in policing, and were objectively reasonable.” That conclusion contradicted the testimony of the city’s police chief, other supervisors, and other use-of-force experts. It was also highly implausible, relying on dubious definitions, eyebrow-raising assumptions, and the omission of crucial details.

Incredibly, former police officer Barry Brodd testified that pinning a handcuffed Floyd facedown on the pavement for nine and a half minutes did not constitute a use of force. “I don’t consider a prone control as a use of force,” he said. “The maintaining of the prone control, to me, is not a use of force…because it’s a control technique. It doesn’t hurt. You’ve put the suspect in a position where it’s safe for you, the officer, safe for them, the suspect, and you’re using minimal effort to keep them on the ground.”

While Chauvin was using this “control technique,” he had one knee on Floyd’s neck and the other on his arm or back. Officer J. Alexander Kueng also was applying pressure to Floyd’s back, while Officer Thomas Lane was holding down his legs. But according to Brodd, the officers were not using force, because they were not hurting Floyd.

Yet Brodd admitted during cross-examination that pressing Floyd against the pavement “could produce pain,” in which case, according to his idiosyncratic definition, it would qualify as a use of force. As prosecutor Steve Schleicher pointed out, Floyd repeatedly complained that he was in pain. He said his neck, stomach, and “everything” hurt. Hennepin County Chief Medical Examiner Andrew Baker testified that Floyd had abrasions on his cheek and shoulder from contact with the pavement.

Los Angles Police Department Sgt. Jody Snider, a use-of-force expert, testified that the officers used “pain compliance” techniques on Floyd’s hands and wrists. “If the officers were manipulating Mr. Floyd’s hands in a way that would create pain,” Brodd conceded, “then I would say yes, that would be a use of force.”

In any case, the Minneapolis Police Department’s definition of force does not require the infliction of pain. “Do you accept that the Minneapolis Police Department generally defines force to include restraint?” Schleicher asked. Brodd acknowledged that Schleicher was right about that.

Given that Chauvin used force against Floyd (a point I did not realize was up for debate until I watched Brodd’s testimony), was that use of force justified in the circumstances? While addressing that question, Brodd, prodded by defense attorney Eric Nelson, introduced several irrelevancies.

The officers believed that Floyd, who had ingested black-market “Percocet” tablets that contained fentanyl and methamphetamine, was under the influence of drugs. “Drug-influenced” suspects, Brodd averred, “don’t feel pain” and “may have superhuman strength”—an old canard with racist roots that police tend to drag out when they are accused of using excessive force.

Even drug warriors who still promote this myth generally do not claim that opioids like fentanyl make people aggressive or enable them to overpower several police officers at once. And while they do make that claim about methamphetamine, prior testimony indicated that the amount of that drug consumed by Floyd was comparable to a single prescribed dose. Superhuman strength and insensitivity to pain are not commonly noted as side effects of Desoxyn or of other oral stimulants with similar effects, such as Adderall and Ritalin.

In any event, Floyd was not displaying the characteristics that Brodd attributes to “drug-influenced persons” during his prone restraint. Far from demonstrating superhuman strength, he was at the cops’ mercy, and he certainly was not insensible to pain, judging from his repeated complaints that the officers were hurting him. Yet the defense seems to think that introducing discredited notions about how people behave when they are “on something” will distract jurors from what actually happened in this case.

Speaking of distraction, Brodd reinforced the defense argument that bystanders who objected to the officers’ treatment of Floyd drew Chauvin’s attention away from the man under his knee. That claim is inconsistent with much of the video record, which shows Chauvin  looking at Floyd, acknowledging his complaints, and talking to his colleagues about how Floyd should be treated.

The defense makes it sound as if the officers were facing an incipient riot. But for much of the time, the bystanders were simply watching the encounter and recording it on their cellphones. Even when some of them were moved to criticize the officers’ conduct and express concern about Floyd’s welfare, they were not violent and did not make any threats. And regardless of what the bystanders were doing, as Schleicher pointed out and Brodd agreed, their behavior cannot legally justify the use of force against Floyd.

Nor can it justify the officers’ failure to perform CPR after Floyd became unconscious and no longer had a detectable pulse. Brodd suggested it was reasonable for them to “wait for the professionals to show up.” But he also acknowledged that they had a duty to care for Floyd—a duty that was not obviated by the fact that an ambulance was on the way.

Brodd also noted that Floyd, who initially seemed to be having a panic attack, struggled with Kueng and Lane when they tried to force him into the back of their squad car. Floyd said he was claustrophobic, complained that he could not breathe, and asked to ride in the front seat. But once Kueng and Lane pulled him out of the car and onto the street, Floyd, at this point handcuffed and kneeling, stopped struggling and thanked them.

That was when Chauvin, Kueng, and Lane tackled Floyd and pinned him to the ground on his stomach, keeping him there despite his complaints that he was having trouble breathing and despite bystanders’ warnings that his life was in danger. Chauvin continued kneeling on Floyd even after he stopped talking, became unresponsive, and no longer had a detectable pulse. The fact that Floyd had earlier resisted Kueng and Lane cannot justify this continued use of force.

Brodd claimed that Floyd was still resisting the officers even when they had him pinned. But his definition of resistance is broad:

Brodd: It appeared to me in that video that he was still struggling.

Schleicher: Struggling or writhing?

Brodd: I don’t know the difference.

Schleicher: Would a reasonable police officer on the scene consider whether somebody is actively resisting or writhing on the ground because they can’t breathe?

Brodd responded that it was reasonable to discount Floyd’s 27 complaints that he could not breathe because he had said something similar during the struggle inside the squad car. Schleicher suggested that it was not reasonable to ignore Floyd’s complaints once the officers were pressing him against the pavement, a different context in which it was less plausible that Floyd was faking.

Brodd’s idea of how Floyd would have behaved if he were “perfectly compliant” underlines how police interpret distress as resistance:

Brodd: A compliant person would have both their hands in the small of their back and just be resting comfortably…He is still moving around.

Schleicher: Did you say “resting comfortably”?

Brodd: Or lying comfortably.

Schleicher: Resting comfortably on the pavement?

Brodd: Yes.

Schleicher: At this point in time…he’s attempting to breathe by shoving his shoulder into the pavement.

Brodd: I was describing what the signs of a perfectly compliant person would be.

Schleicher: So attempting to breathe while restrained is being slightly noncompliant?

Brodd: No.

Brodd’s discussion of “positional asphyxia,” which is what the prosecution says killed Floyd, likewise had an air of unreality. He initially suggested that the hazard is relevant only when police are dealing with an “extremely obese” suspect whose body weight would press against his lungs when he lies on his stomach. But during cross-examination, he conceded that there could be a risk of positional asphyxia when police apply their own body weight to a thinner person in that position. He also acknowledged that the Minneapolis police officers are trained to move suspects to a “side recovery position” because of that danger, which he said is widely recognized by police.

Lane twice suggested that Floyd should be rolled onto his side, but Chauvin flatly rejected the idea. “In this situation, there [were] space limitations,” Brodd said. “Mr. Floyd was butted up against the tire of the patrol car. There was traffic still driving down the street. There were crowd issues that took the attention of the officers. Mr. Floyd was still somewhat resisting. So I think those were relatively valid reasons to keep him in the prone [position].” According to prosecution witnesses, including the police chief, the decision that Brodd calls “relatively valid” was objectively unreasonable and a clear violation of department policy.

Even by Brodd’s account, Floyd was “actively resisting” or “struggling against the officers” for “a couple of minutes.” Yet Chauvin kept kneeling on Floyd for an additional seven and a half minutes. At one point, Lane said, “He’s passing out.” Brodd conceded that Floyd did not seem to be resisting after he lost consciousness. Yet Chauvin maintained his position over Floyd for nearly five minutes after he became unresponsive, even after Kueng said he could not find a pulse.

While the prosecution says the prolonged prone restraint killed Floyd, Brodd said it was for his own good. Given an intoxicated suspect’s “potential erratic behavior, going from compliant to noncompliant, not feeling any pain, potentially having superhuman strength,” he averred, “it’s just safer for the officer and for the suspect to keep them in that prone control.”

How is it safer for the suspect? “If they were to get up and run, handcuffed,” Brodd said, they could “trip and fall, sustain facial injuries, other injuries. On the ground, their mobility is reduced…and their ability to hurt themselves is reduced.” If you believe Brodd, the cops killed Floyd to stop him from hurting himself.

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A Defense Witness Says the Cops Who Pinned George Floyd to the Pavement Were Not Using Force


Barry-Brodd-testifying-4-13-21-Newscom

The defense in Derek Chauvin’s murder trial yesterday presented testimony from a use-of-force expert who said the former Minneapolis police officer’s “interactions” with George Floyd “were following his training, following current practices in policing, and were objectively reasonable.” That conclusion contradicted the testimony of the city’s police chief, other supervisors, and other use-of-force experts. It was also highly implausible, relying on dubious definitions, eyebrow-raising assumptions, and the omission of crucial details.

Incredibly, former police officer Barry Brodd testified that pinning a handcuffed Floyd facedown on the pavement for nine and a half minutes did not constitute a use of force. “I don’t consider a prone control as a use of force,” he said. “The maintaining of the prone control, to me, is not a use of force…because it’s a control technique. It doesn’t hurt. You’ve put the suspect in a position where it’s safe for you, the officer, safe for them, the suspect, and you’re using minimal effort to keep them on the ground.”

While Chauvin was using this “control technique,” he had one knee on Floyd’s neck and the other on his arm or back. Officer J. Alexander Kueng also was applying pressure to Floyd’s back, while Officer Thomas Lane was holding down his legs. But according to Brodd, the officers were not using force, because they were not hurting Floyd.

Yet Brodd admitted during cross-examination that pressing Floyd against the pavement “could produce pain,” in which case, according to his idiosyncratic definition, it would qualify as a use of force. As prosecutor Steve Schleicher pointed out, Floyd repeatedly complained that he was in pain. He said his neck, stomach, and “everything” hurt. Hennepin County Chief Medical Examiner Andrew Baker testified that Floyd had abrasions on his cheek and shoulder from contact with the pavement.

Los Angles Police Department Sgt. Jody Snider, a use-of-force expert, testified that the officers used “pain compliance” techniques on Floyd’s hands and wrists. “If the officers were manipulating Mr. Floyd’s hands in a way that would create pain,” Brodd conceded, “then I would say yes, that would be a use of force.”

In any case, the Minneapolis Police Department’s definition of force does not require the infliction of pain. “Do you accept that the Minneapolis Police Department generally defines force to include restraint?” Schleicher asked. Brodd acknowledged that Schleicher was right about that.

Given that Chauvin used force against Floyd (a point I did not realize was up for debate until I watched Brodd’s testimony), was that use of force justified in the circumstances? While addressing that question, Brodd, prodded by defense attorney Eric Nelson, introduced several irrelevancies.

The officers believed that Floyd, who had ingested black-market “Percocet” tablets that contained fentanyl and methamphetamine, was under the influence of drugs. “Drug-influenced” suspects, Brodd averred, “don’t feel pain” and “may have superhuman strength”—an old canard with racist roots that police tend to drag out when they are accused of using excessive force.

Even drug warriors who still promote this myth generally do not claim that opioids like fentanyl make people aggressive or enable them to overpower several police officers at once. And while they do make that claim about methamphetamine, prior testimony indicated that the amount of that drug consumed by Floyd was comparable to a single prescribed dose. Superhuman strength and insensitivity to pain are not commonly noted as side effects of Desoxyn or of other oral stimulants with similar effects, such as Adderall and Ritalin.

In any event, Floyd was not displaying the characteristics that Brodd attributes to “drug-influenced” people during his prone restraint. Far from demonstrating superhuman strength, he was at the cops’ mercy, and he certainly was not insensible to pain, judging from his repeated complaints that the officers were hurting him. Yet the defense seems to think that introducing discredited notions about how people behave when they are “on something” will distract jurors from what actually happened in this case.

Speaking of distraction, Brodd reinforced the defense argument that bystanders who objected to the officers’ treatment of Floyd drew Chauvin’s attention away from the man under his knee. That claim is inconsistent with much of the video record, which shows Chauvin  looking at Floyd, acknowledging his complaints, and talking to his colleagues about how Floyd should be treated.

The defense makes it sound as if the officers were facing an incipient riot. But for much of the time, the bystanders were simply watching the encounter and recording it on their cellphones. Even when some of them were moved to criticize the officers’ conduct and express concern about Floyd’s welfare, they were not violent and did not make any threats. And regardless of what the bystanders were doing, as Schleicher pointed out and Brodd agreed, their behavior cannot legally justify the use of force against Floyd.

Nor can it justify the officers’ failure to perform CPR after Floyd became unconscious and no longer had a detectable pulse. Brodd suggested it was reasonable for them to “wait for the professionals to show up.” But he also acknowledged that they had a duty to care for Floyd—a duty that was not obviated by the fact that an ambulance was on the way.

Brodd also noted that Floyd, who initially seemed to be having a panic attack, struggled with Kueng and Lane when they tried to force him into the back of their squad car. Floyd said he was claustrophobic, complained that he could not breathe, and asked to ride in the front seat. But once Kueng and Lane pulled him out of the car and onto the street, Floyd, at this point handcuffed and kneeling, stopped struggling and thanked them.

That was when Chauvin, Kueng, and Lane tackled Floyd and pinned him to the ground on his stomach, keeping him there despite his complaints that he was having trouble breathing and despite bystanders’ warnings that his life was in danger. Chauvin continued kneeling on Floyd even after he stopped talking, became unresponsive, and no longer had a detectable pulse. The fact that Floyd had earlier resisted Kueng and Lane cannot justify this continued use of force.

Brodd claimed that Floyd was still resisting the officers even when they had him pinned. But his definition of resistance is broad:

Brodd: It appeared to me in that video that he was still struggling.

Schleicher: Struggling or writhing?

Brodd: I don’t know the difference.

Schleicher: Would a reasonable police officer on the scene consider whether somebody is actively resisting or writhing on the ground because they can’t breathe?

Brodd responded that it was reasonable to discount Floyd’s 27 complaints that he could not breathe because he had said something similar during the struggle inside the squad car. Schleicher suggested that it was not reasonable to ignore Floyd’s complaints once the officers were pressing him against the pavement, a different context in which it was less plausible that Floyd was faking.

Brodd’s idea of how Floyd would have behaved if he were “perfectly compliant” underlines how police interpret distress as resistance:

Brodd: A compliant person would have both their hands in the small of their back and just be resting comfortably…He is still moving around.

Schleicher: Did you say “resting comfortably”?

Brodd: Or lying comfortably.

Schleicher: Resting comfortably on the pavement?

Brodd: Yes.

Schleicher: At this point in time…he’s attempting to breathe by shoving his shoulder into the pavement.

Brodd: I was describing what the signs of a perfectly compliant person would be.

Schleicher: So attempting to breathe while restrained is being slightly noncompliant?

Brodd: No.

Brodd’s discussion of “positional asphyxia,” which is what the prosecution says killed Floyd, likewise had an air of unreality. He initially suggested that the hazard is relevant only when police are dealing with an “extremely obese” suspect whose body weight would press against his lungs when he lies on his stomach. But during cross-examination, he conceded that there could be a risk of positional asphyxia when police apply their own body weight to a thinner person in that position. He also acknowledged that the Minneapolis police officers are trained to move suspects to a “side recovery position” because of that danger, which he said is widely recognized by police.

Lane twice suggested that Floyd should be rolled onto his side, but Chauvin flatly rejected the idea. “In this situation, there [were] space limitations,” Brodd said. “Mr. Floyd was butted up against the tire of the patrol car. There was traffic still driving down the street. There were crowd issues that took the attention of the officers. Mr. Floyd was still somewhat resisting. So I think those were relatively valid reasons to keep him in the prone [position].” According to prosecution witnesses, including the police chief, the decision that Brodd calls “relatively valid” was objectively unreasonable and a clear violation of department policy.

Even by Brodd’s account, Floyd was “actively resisting” or “struggling against the officers” for “a couple of minutes.” Yet Chauvin kept kneeling on Floyd for an additional seven and a half minutes. At one point, Lane said, “He’s passing out.” Brodd conceded that Floyd did not seem to be resisting after he lost consciousness. Yet Chauvin maintained his position over Floyd for nearly five minutes after he became unresponsive, even after Kueng said he could not find a pulse.

While the prosecution says the prolonged prone restraint killed Floyd, Brodd said it was for his own good. Given an intoxicated suspect’s “potential erratic behavior, going from compliant to noncompliant, not feeling any pain, potentially having superhuman strength,” he averred, “it’s just safer for the officer and for the suspect to keep them in that prone control.”

How is it safer for the suspect? “If they were to get up and run, handcuffed,” Brodd said, they could “trip and fall, sustain facial injuries, other injuries. On the ground, their mobility is reduced…and their ability to hurt themselves is reduced.” If you believe Brodd, the cops killed Floyd to stop him from hurting himself.

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Hong Kong Journalist Who Embarrassed WHO Official Quits After Online Attacks

Hong Kong Journalist Who Embarrassed WHO Official Quits After Online Attacks

A Hong Kong journalist who exposed China’s influence over the World Health Organization by pressing a WHO official over Taiwanese independence has quit her job at broadcaster RTHK, according to the Hong Kong Free Press, which suggests that there are fears over the outlet’s editorial independence “following criticism from pro-Beijing forces and the government, which says the station needs major reforms.”

Journalist Yvonne Tong famously embarrassed the WHO’s Bruce Aylward during a 2020 interview, when she asked whether the organization might consider giving Taiwan a membership – to which Aylward hung up on her, and then dodged the same question when asked again.

China views Taiwan as a breakaway province which it has vowed to retake by force if necessary, while Taiwan’s leaders argue it’s a sovereign state.

The incident between Tong and Aylward caused Taiwan’s Foreign Minister, Joseph Wu, to highlight Aylward’s overt shilling for the CCP.

After the clip went viral, the WHO issued a statement clarifying that membership in the organization is up to WHO states, not staff – and that Taiwan has kept COVID-19 numbers relatively low, and should be learned from.

“WHO is taking lessons learned from all areas, including Taiwanese health authorities, to share best practices globally,” said WHO spokesman Tarik Jasarevic.

Yvonne Tong, however, came under attack according to HKFP – and was harassed and doxxed online, with her personal information being posted on pro-Beijing websites.

Tong had worked for RTHK since 2014, according to her LinkedIn page.

Tyler Durden
Wed, 04/14/2021 – 16:40

via ZeroHedge News https://ift.tt/3dfQCVY Tyler Durden

Final Nail In The Coffin

Final Nail In The Coffin

Authored by James Rickards via The Daily Reckoning,

The stock market is trading at record highs. The mainstream financial media will tell you it’s because the market is anticipating a robust recovery as the economy continues to reopen and vaccination numbers grow.

But don’t buy into the happy talk that all is well with the U.S. economy.

The unemployment rate has indeed dropped. But initial unemployment claims are on the rise again. That’s a trend that will show up as weaker job creation in the months ahead.

The declining headline unemployment rate ignores over 10 million able-bodied Americans between the ages of 25 and 54 who don’t have jobs but are not counted as unemployed because they haven’t looked for a job recently.

If you’re a waitress, why would you look for a job if half the restaurants in town are closed or out of business?

You can judge the health of the economy based on a few key metrics: the labor force participation rate, real wage increases, and initial unemployment claims. Right now, all three point to slower growth and a recovery that is running out of steam.

Of course, some claim the cure is more government spending.

Under 10% To Actual Infrastructure

No sooner had Biden signed the $1.9 trillion COVID relief bailout bill, than his administration proposed another $4 trillion of deficit spending for “infrastructure.”

Proponents of the bill claim the spending is for “infrastructure.” But most of what they’re saying about this legislation is phony.

Most Americans understand infrastructure to mean bridges, tunnels, roads, railroads, airports and other needed additions and improvements to the transportation network. But the bill only provides about $400 billion for those types of projects, under 10% of the proposed total.

The rest goes to windmills, solar panels, subsidies to electric vehicles, and school repairs (as a payoff to teachers’ unions).

Even more spending goes to items that have nothing to do with infrastructure, such as day care, tuition, unemployment benefits, community organizers and other welfare-style programs.

In other words, it’s more of a political project than an economic package to provide good jobs and stimulate the economy.

One difference between Biden’s $4 trillion infrastructure spending binge and the $1.9 trillion of COVID relief is that the White House is at least going through the motions of trying to pay for the new spending with massive tax increases.

Phony Talking Points on Taxes

In round numbers, today’s view is that Biden will have $4 trillion of new “infrastructure” spending combined with $2.1 trillion of tax increases, making the net new deficit spending on infrastructure $1.9 trillion.

But the tax increases are the subject of even more phony talking points.

Biden proclaimed that he would not raise taxes on anyone making less than $400,000. But now, “anyone” is being redefined to include a married couple filing a joint return with $400,000 combined income.

This means that if one spouse makes $220,000 and the other spouse makes $180,000, then the combined income of $400,000 would be subject to the new top bracket of 39.6% that Biden wants.

A spouse making $220,000 may sound like a lot of money, unless you happen to live in New York, San Francisco, Los Angeles or Miami and have two or more children. In this case, it’s barely enough to get buy after income taxes, property taxes, sales taxes, gasoline taxes and a generally high cost of living.

Additionally, much of the tax increase burden will fall on U.S. corporations, which will hurt our international competitiveness and force corporations to move businesses and jobs offshore to avoid the higher taxes in the U.S.

So, Biden’s tax plans will drive U.S. jobs offshore and punish the middle-class, not just the “rich.” It will be just one more headwind for economic growth in the years ahead.

Modern Monetary Theory Is Here Now

The real takeaway from the avalanche of new spending is that the last vestiges of fiscal constraint are vanishing.

I’m sure you’ve heard about Modern Monetary Theory (MMT) by now.

Biden may or may not understand what MMT is, but it doesn’t matter. The point is, it’s here.

MMT is now the law of the land in the form of extreme deficit spending.

There’s a complete disregard for the size of the deficit or whether spending is paid for with taxes. The resulting unprecedented growth in the debt-to-GDP ratio has now put the U.S. in the same super-debtor league as Lebanon, Greece and Italy.

Bernie Sanders is chair of the Senate Budget Committee, and his muse is Professor Stephanie Kelton, the bright light of MMT advocates.

Presidents and members of Congress have always been addicted to spending; but now, they have intellectual air cover in the form of the callow analytics of MMT.

At this stage of the process, there is no stimulus or real growth, just more debt. The already slow recovery will slow further, and the debt will remain.

That’s what rising initial claims for unemployment benefits are telling us.

Biden Wants to Be the Next FDR or LBJ

The infrastructure spending bill may be broken into two pieces so that part of it can be passed under a process called “reconciliation” that requires no Republican votes. The tax bill itself may be separated for the same reason.

The result is that the entire program may require three separate bills and lots of horse-trading behind the scenes, but the Democrats are determined to get it all done by the end of the summer.

Democrats want at least large parts of this new spending plan out of committee by the end of May and passed by the entire House of Representatives by the Fourth of July.

Then they hope the Senate will act quickly and get the entire package done before the August recess.

There’s a method to the madness.

Biden and Democrat party leaders know that 2022 is an election year for the House and Senate. The Democrats may very well lose the House; they currently have a slim nine-vote margin (222-213), and it would only take five losses to flip the House to a 218-217 Republican majority.

New administrations typically lose 20 or more House seats in their first mid-term election, so the Democratic majority is definitely in danger.

The Republicans could eke out a slim majority in the Senate as well. Either result (or both) would put an end to the Democrats’ ability to ram through their agenda.

The window for Democrats’ plans such as the New Green Deal, free tuition, free healthcare, free child care, increased unemployment benefits, student loan forgiveness, and so-called infrastructure is brief.

By August, we’ll know if the country has held the line on reckless spending and more welfare or if Biden will get to make history by permanently pushing America to the left in the manner of FDR’s original New Deal and Lyndon Johnson’s Great Society.

The difference for investors in terms of portfolio construction and asset allocation is huge. I’ll be watching closely and keeping you ahead of the curve. We won’t have long to wait.

Tyler Durden
Wed, 04/14/2021 – 16:20

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Dollar Dumps Amid COIN Carnage, Archegos Angst, & Ignited Inflation

Dollar Dumps Amid COIN Carnage, Archegos Angst, & Ignited Inflation

While soaring import and export price inflation was enough to spook some…

Source: Bloomberg

All eyes were on Coinbase’s IPO (direct listing). The stock opened at $381, spiked to $429.54, then tumbled back below it’s open

Still could have been worse, anyone else remember the BATS IPO in 2012?

Probably the most disastrous IPO of all time, BATS, an alternative stock exchange, was forced to pull out after a bizarre technological glitch in its own exchange! Trading was halted after the stock plunged to $.04 from an initial price of $15.25 just a few moments after it opened.

And as crypto stole the headlines, the dollar continued its recent demise…

Source: Bloomberg

The dollar ran the stops from early March and has tumbled back to what is a key level here…

Source: Bloomberg

Does make you wonder if Washington has “meddled with the primal forces” one too many times?

Small Caps went vertical at the cash open in a haze of utter ridiculousness, but everything rolled over as COIN broke below its open level…

Anxiety over whether the Archegos debacle is over arose again last night as Credit Suisse dumped big blocks of Discovery and iQIYI…

Bank stocks were mixed after earnings with JPM down, WFC and GS up

Source: Bloomberg

Notably, the Bitcoin-proxies all slid lower today also…

Source: Bloomberg

“Most Shorted” stocks were squeezed hard at the open (which probably explains the spike in Small Caps), but after Europe closed, the shorts started to slide and hedge-fund-faves were also dumped…

Source: Bloomberg

Bonds were sold today with yields in the belly and the long-end up around 2bps

Source: Bloomberg

Amid the Coinbase excitement, cryptos were choppy today with bitcoin hitting a new record high near $65,000…

Source: Bloomberg

And Ethereum also hit a new record high above $2400 before fading…

Source: Bloomberg

Ether is notably outperforming BTC in the last few days…

Source: Bloomberg

Despite the dollar weakness, gold was hit on the inflation data this morning and never bounced back…

Oil prices on the other hand were on fire, with WTI spiking above $63 after a surprisingly large crude draw…

Finally, while EPS season commencement obviously matters from a sentiment-, vol-, dispersion- and gross / net leverage- impact; Nomura’s Charlie McElligott warns that locally, Op-Ex cyclicality will likely matter the most for market prices over the next week + period:

The Vol crush into Op-Ex has meant ongoing supportive Vanna- and Charm- flow, while hedger Delta is covered in out of the money Calls and Puts.

Yet analytics showing ~36% of SPX Gamma will be running-off after this Friday’s upcoming expiration, with an even more eye-watering 55% reduction of QQQ Gamma, 64% (!) of IWM and 47% of EEM, sets us up for “freedom to move around the cabin” thereafter beginning Friday morning and into start of next wk, with the prior hedging buffers sharply lowered in both directions and allowing for much larger price ranges again both directions – especially with aforementioned massive $Deltas (SPX $Delta 96%ile, QQQ $Delta 100%ile) as source of potential de-risking.

In other words – brace!

Tyler Durden
Wed, 04/14/2021 – 16:01

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Threat of Frivolous but Reputation-Damaging Lawsuit Can Be Criminal Extortion,

The case is yesterday’s U.S. v. Koziol, written by Judge Bridget Bade and joined by Judge Carlos Bea and District Judge Gershwin Drain (E.D. Mich.):

Benjamin Koziol was convicted of attempted extortion under the Hobbs Act, 18 U.S.C.
§ 1951(a), for threatening to file suit against a well-known entertainer asserting salacious and scandalous allegations of sexual harassment, sexual assault, and assault and battery if the entertainer did not settle with Koziol for $1,000,000.

On appeal, Koziol argues that … the threat of litigation, even a baseless and bad faith threat, cannot constitute “wrongful” conduct under the Hobbs Act…. We affirm [the] conviction ….

Here, there was ample evidence at trial from which a rational jury could conclude that Koziol knew his allegations were baseless and that he had no right to obtain any money from the entertainer. As an initial matter, the uncontested evidence at trial established that it was the manager, not the entertainer, who was present at Sweet’s apartment on the night of the massage. Several months after the manager negotiated a settlement with Koziol’s wife, Sweet, Koziol accused the manager of “verbally and physically” assaulting him, even though Koziol was not mentioned in the detailed
demand letter that Saadian, Sweet’s attorney, previously sent to Wright, the manager’s attorney.

When Koziol made these allegations against the manager, Koziol was aware that the
manager had settled with Sweet and he claimed that Saadian had also represented him. After Wright refused any attempts to extract additional money from her client, Koziol changed his story to accuse the entertainer. He later falsely claimed that he had “never accused [the manager] of anything!” And in his threats to sue the entertainer, Koziol contradicted his earlier allegations and stated that the manager “was never at my apartment and has nothing to do with this case.”

Moreover, the uncontested evidence also established the entertainer had never even met Koziol or Sweet. Nonetheless, despite his earlier claims that the manager was the massage customer who assaulted him, Koziol changed his story and claimed that he confronted the entertainer at the apartment on the night of the massage and spoke to him, asserted that “by the look on [the entertainer’s] face” he was “obviously surprised to see” Koziol, and accused the entertainer of punching him in the face and knocking him unconscious. Koziol also claimed that he “immediately recognized” the entertainer when he searched for him on the internet. From this evidence, a rational jury could find that Koziol knew that the manager, not the entertainer, was the massage customer and that Koziol knew he did not have a claim against the entertainer.

Koziol also used falsified evidence (the photograph of his purported injuries) to bolster his threats against the entertainer, he lied about the existence of evidence that supported his claims (the video that purportedly showed the entertainer at Sweet’s apartment the night of the massage). And in the demand letter that Koziol’s wife sent to the manager through her attorney, she also claimed that she had a video showing the massage customer at the apartment—but stated that the video showed the manager at the apartment. Again, from this evidence, a rational jury could conclude that Koziol knew he had no lawful claim against the entertainer.

Among other things, the court concludes that such threats are unprotected by the Petition Clause (which does prevent many kinds of liability based on non-sham litigation):

Koziol fabricated evidence, lied about the existence of evidence, and knew that his claims were baseless, all of which further demonstrates that his threats to file a lawsuit were made with an improper motive. From this evidence, we conclude that Koziol knew that his threatened lawsuit could never prove fruitful if brought before a jury, which is why he attempted to intimidate the entertainer into a settlement based on admittedly falsified evidence and an implied threat that scandalous allegations in a publicly filed lawsuit would irrevocably damage the entertainer’s reputation and livelihood.

Therefore, we reject Koziol’s argument that his litigation threats did not rise to the level of a sham as a matter of law and conclude that the Noerr–Pennington doctrine did not immunize Koziol’s threats of sham litigation.

Thanks to Howard Bashman (How Appealing) for the pointer. For a similar case, though one in which the threatened lawsuit wouldn’t have damaged the defendant’s reputation as much, see this 2009 post. A District Court decision names the target of the extortion scheme (who appears to have been entirely innocent here), and so does a press account about the Ninth Circuit decision. News reports about the target (unrelated to the extortion case) do suggest that he is known in part for traditional sexual morality and religiosity, which might explain why the extortionate threats may have been seen as especially potentially damaging.

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Watch: Rand Paul Demands “Petty Tyrant” Fauci Be “Removed From TV For Fear Mongering”

Watch: Rand Paul Demands “Petty Tyrant” Fauci Be “Removed From TV For Fear Mongering”

Authored by Steve Watson via Summit News,

Appearing on Fox Business Tuesday, Senator Rand Paul made an impassioned plea for Anthony Fauci to be taken off the airwaves for continually ‘fear mongering’.

Paul claimed that Fauci has ceaselessly made claims that are not “matched by the science of his own institute.”

“I so much think Dr. Fauci should be voluntarily removed from TV because what he says is such a disservice, and such fear-mongering,” Paul urged.

The Senator pointed in particular to comments made by Fauci earlier this week when he claimed that Americans should still not be socialising together indoors, even if they have been fully vaccinated, comments that contradict CDC findings that vaccinated people cannot transmit the virus.

Paul called Fauci’s demands “ridiculous”, “against the science,” and charged that Fauci could also be “discouraging people” from getting vaccinated.

“People want a reward, rewards work, and your reward if you get the vaccine is you can live your life again, you’re not going to get it or transmit it to people, the likelihood is very, very small, and the risk is such that you could probably go back to living a normal life,” Paul stated.

“So he needs to quit dictating to the entire world how to live and let us make our own decisions,” the Senator urged.

Earlier this week Paul called Fauci a “petty tyrant,” accusing the White House medical advisor of  ignoring “100 years of vaccine science”.

The Senator also urged Americans to get vaccinated “if you think you need or want it” and then to throw away the masks and reclaim freedom:

Paul has repeatedly clashed with Fauci over the latter’s obsession with masks and lack of clarity on the science of the COVID pandemic.

Most recently, two weeks ago, Paul urged Fauci to follow the CDC’s latest findings that the vaccinated do not carry the virus:

The Senator clashed with Fauci last month, telling him “You’ve been vaccinated and you parade around in two masks for show. You can’t get it again.” 

“There’s virtually zero percent chance you’re going to get it and you’re telling people that have had the vaccine who have immunity — You’re defying everything we know about immunity by telling people to wear masks who have been vaccinated,” Paul charged during the hearing.

Fauci has repeatedly flip flopped on the efficacy of masks, and has admitted that there is little science behind lockdown restrictions.

Nevertheless, Fauci still will not drop the mask charade, even suggesting that the world needs to carry on wearing them into 2022, and that children should be wearing them in order to play together, until they are all vaccinated from the age of 6 months old.

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Tyler Durden
Wed, 04/14/2021 – 15:41

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Egypt Impounds Suez-Blocking Megaship ‘Ever Given’ As Authorities Seek $900 Million Compensation

Egypt Impounds Suez-Blocking Megaship ‘Ever Given’ As Authorities Seek $900 Million Compensation

The Egyptian authorities have seized the massive container ship that notoriously blocked the Suez Canal for almost a week as the government demands hundreds of millions of dollars in compensation from its owners. 

This week, an Egyptian court ordered Ever Given’s Japanese owner, Shoei Kisen Kaisha, to pay a whopping $900 million in compensation after the vessel blocked the world’s most important waterway for six days. 

The seizure was first reported on Ahram Gate, a state-run website, on Tuesday: 

Lieutenant General Osama Rabie, Chairman of the Suez Canal Authority (SCA), confirmed in a press statement, today, Tuesday, that the Panamanian ship “Evergiven”, which ran aground earlier for six days, was seized for failure to pay an amount of $ 900 million , which is the value of what it caused. The delinquent ship from losses to the Authority as well as the flotation and maintenance process, according to a court ruling issued by the Ismailia Economic Court.

The Authority relies in its estimation of the fees mentioned in the guidance regulation in force within the Suez Canal Authority, and the Authority based its request for precautionary seizure on the ship, on Article 6 of the Economic Courts Law, which is exclusively the jurisdiction of the appellate circuits in the economic courts, to first consider all disputes and lawsuits that It arises from the application of maritime trade law.

The Authority also based its request on Article 59 of the Maritime Trade Law, which permits precautionary seizure of ships by order of the head of the court or whoever acts on his behalf. The order also permits the imposition of this seizure even if the ship is ready to travel, and it is also based on Article 60, which states that The precautionary seizure is signed except for the fulfillment of a maritime debt, and the debt is considered maritime if it arises from several reasons, including port fees and waterways, the expenses of removing, salvaging or lifting the ship’s wreck and cargo, and the damages caused by the ship due to collision, pollution or other similar maritime accidents.

The compensation payment Egypt seeks includes lost revenue from the ships that would have transited the waterway during the blockage and damages to the canal and the equipment and labor to dislodge the mega container ship from the canal’s bank. 

For at least two weeks, Ever Given has been moored in Egypt’s Great Bitter Lake, at the canal’s midpoint as it undergoes inspections and now seizure. 

Osama Rabie, chairman of the SCA, told the Wall Street Journal that the vessel “will remain here until investigations are complete and compensation is paid.” He added, “the minute they agree to compensation, the vessel will be allowed to move.”

WSJ said Ever Given’s Japanese owner, Shoei Kisen Kaisha, is locked in SCA discussions on compensation amounts. The vessel’s owners filed a lawsuit in a British court with the hopes of limiting its liability for the incident.

Rabie told Egyptian television on Monday that a complete investigation into the mishap on the canal will be wrapped up by the end of the week. He said even after the investigation is complete – compensation negotiations could continue. He said the ship’s owners were attempting to reduce compensation by at least 90%. 

All and all, Ever Given’s six-day accident in the world’s most important waterway could turn out to be the most expensive parking ticket ever. 

Tyler Durden
Wed, 04/14/2021 – 15:25

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Threat of Frivolous but Reputation-Damaging Lawsuit Can Be Criminal Extortion,

The case is yesterday’s U.S. v. Koziol, written by Judge Bridget Bade and joined by Judge Carlos Bea and District Judge Gershwin Drain (E.D. Mich.):

Benjamin Koziol was convicted of attempted extortion under the Hobbs Act, 18 U.S.C.
§ 1951(a), for threatening to file suit against a well-known entertainer asserting salacious and scandalous allegations of sexual harassment, sexual assault, and assault and battery if the entertainer did not settle with Koziol for $1,000,000.

On appeal, Koziol argues that … the threat of litigation, even a baseless and bad faith threat, cannot constitute “wrongful” conduct under the Hobbs Act…. We affirm [the] conviction ….

Here, there was ample evidence at trial from which a rational jury could conclude that Koziol knew his allegations were baseless and that he had no right to obtain any money from the entertainer. As an initial matter, the uncontested evidence at trial established that it was the manager, not the entertainer, who was present at Sweet’s apartment on the night of the massage. Several months after the manager negotiated a settlement with Koziol’s wife, Sweet, Koziol accused the manager of “verbally and physically” assaulting him, even though Koziol was not mentioned in the detailed
demand letter that Saadian, Sweet’s attorney, previously sent to Wright, the manager’s attorney.

When Koziol made these allegations against the manager, Koziol was aware that the
manager had settled with Sweet and he claimed that Saadian had also represented him. After Wright refused any attempts to extract additional money from her client, Koziol changed his story to accuse the entertainer. He later falsely claimed that he had “never accused [the manager] of anything!” And in his threats to sue the entertainer, Koziol contradicted his earlier allegations and stated that the manager “was never at my apartment and has nothing to do with this case.”

Moreover, the uncontested evidence also established the entertainer had never even met Koziol or Sweet. Nonetheless, despite his earlier claims that the manager was the massage customer who assaulted him, Koziol changed his story and claimed that he confronted the entertainer at the apartment on the night of the massage and spoke to him, asserted that “by the look on [the entertainer’s] face” he was “obviously surprised to see” Koziol, and accused the entertainer of punching him in the face and knocking him unconscious. Koziol also claimed that he “immediately recognized” the entertainer when he searched for him on the internet. From this evidence, a rational jury could find that Koziol knew that the manager, not the entertainer, was the massage customer and that Koziol knew he did not have a claim against the entertainer.

Koziol also used falsified evidence (the photograph of his purported injuries) to bolster his threats against the entertainer, he lied about the existence of evidence that supported his claims (the video that purportedly showed the entertainer at Sweet’s apartment the night of the massage). And in the demand letter that Koziol’s wife sent to the manager through her attorney, she also claimed that she had a video showing the massage customer at the apartment—but stated that the video showed the manager at the apartment. Again, from this evidence, a rational jury could conclude that Koziol knew he had no lawful claim against the entertainer.

Among other things, the court concludes that such threats are unprotected by the Petition Clause (which does prevent many kinds of liability based on non-sham litigation):

Koziol fabricated evidence, lied about the existence of evidence, and knew that his claims were baseless, all of which further demonstrates that his threats to file a lawsuit were made with an improper motive. From this evidence, we conclude that Koziol knew that his threatened lawsuit could never prove fruitful if brought before a jury, which is why he attempted to intimidate the entertainer into a settlement based on admittedly falsified evidence and an implied threat that scandalous allegations in a publicly filed lawsuit would irrevocably damage the entertainer’s reputation and livelihood.

Therefore, we reject Koziol’s argument that his litigation threats did not rise to the level of a sham as a matter of law and conclude that the Noerr–Pennington doctrine did not immunize Koziol’s threats of sham litigation.

Thanks to Howard Bashman (How Appealing) for the pointer. For a similar case, though one in which the threatened lawsuit wouldn’t have damaged the defendant’s reputation as much, see this 2009 post. A District Court decision names the target of the extortion scheme (who appears to have been entirely innocent here), and so does a press account about the Ninth Circuit decision. News reports about the target (unrelated to the extortion case) do suggest that he is known in part for traditional sexual morality and religiosity, which might explain why the extortionate threats may have been seen as especially potentially damaging.

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US Stimmy Checks Support Foreign Manufacturing Economies

US Stimmy Checks Support Foreign Manufacturing Economies

Via SchiffGold.com,

What do you get when you hand Americans big fat stimulus checks after decades of offshoring the country’s manufacturing economy?

Massive trade deficits.

The proof is in the numbers.

The overall trade deficit expanded by 87% in February to $71.1 billion, according to the latest Census Bureau data.

The trade deficit in goods hit another all-time record of $88 billion in February. Imports of goods jumped 10.3% year-on-year $219 billion. Exports of goods sagged 5.2% to $131 billion.

In the past, we were told the persistent drop in exported US goods was not a big problem because we can make up for it by exporting services. It hasn’t worked out that way. While the US still runs a trade surplus in services, the number is shrinking. The surplus of services in February plunged 24.4% to $16.9 billion. That was the lowest level since 2012. In fact, we’ve seen a steady deterioration of the services surplus since 2018.

As WolfStreet explains, the US has increasingly offshored its entire economy.

During the Financial Crisis, the goods trade deficit shrank substantially, as consumers cut back buying imported stuff, while the trade surplus of services dipped only briefly and the overall trade deficit shrank substantially. But instead of reversing the course of the prior two decades of ballooning trade deficits, Corporate America went into hyperdrive during the Financial Crisis to offshore not only production, but also the design work that went along with it.”

Today, virtually all of the durable goods sold in the US are imported – from smartphones, to appliances, to clothing. And many of the products assembled in the US are made from imported parts. WolfStreet says we’ve established a pattern.

After decades of rampant offshoring of production, US consumers get free stimulus money in the hopes that they will turn this taxpayer money – or rather future taxpayers’ money since this is borrowed money and will have to be dealt with by future taxpayers for all times to come – into a big-fat stimulus for the manufacturing economies in other countries.”

This mirrors what Peter Schiff has been saying.

The government, or the Federal Reserve, is printing money and just giving it to unemployed people who aren’t making stuff, but they’re spending money. And so what they’re doing is they’re buying the stuff that people in other countries are employed making. So, it’s the productivity of the rest of the world that Americans are living off of, and the trade deficit evidences that and shows you that our whole economy, our whole recovery, is a fraud.”

Peter said this shows you just how much the US economy has declined.

At this point, we’re just living off the charity of the rest of the world and there’s a limit to the amount of charity, and I think we’re going to be testing those limits soon.”

What we’re seeing is entirely predictable. When you had a bunch of people who aren’t producing anything big fat checks, they’re going to spend the money on goods that come from places where people are working. In effect, the US government is supporting the manufacturing economies of China and other countries. As Peter put it, China gives the US valuable consumer goods that our economy lacks the capacity to produce. All the Chinese get in exchange for their efforts and resources are dollars, which the US creates for free.

This is clearly not sustainable. What happens when the Chinese decide they have enough dollars? And that day may not be far down the road.

Tyler Durden
Wed, 04/14/2021 – 15:10

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