A major exchange of fire has erupted along the contested Kashmir border separating India and Pakistan known as the Line of Control (LoC). Pakistan’s army says at lease three Pakistani and five Indian soldiers were killed during the cross-border fighting on Thursday.
However, India is denying the Pakistani army’s account of the “ceasefire violations,” calling it “fictitious”. According to India Today “unprovoked fire” from the Pakistani side deliberately timed during India’s 73rd Independence Day forced a response. India claims there were no casualties on its side, while affirming that three Pakistani troops were killed.
File image: Indian troops along the Line of Control
The incident was first revealed when chief spokesman of the Pakistan armed forces, Major General Asif Ghafoor, announced on Twitter that Indian forces had fired at the LoC, and that “Intermittent exchange of fire continues”.
In efforts to divert attention from precarious situation in IOJ&K,Indian Army increases firing along LOC.
3 Pakistani soldiers embraced shahadat. Pakistan Army responded effectively. 5 Indian soldiers killed, many injured, bunkers damaged. Intermittent exchange of fire continues. pic.twitter.com/wx1RoYdiKE
In response to Pakistan’s claim of 5 Indian soldiers killed, a senior Indian Army official told national media, “The claim made by Pakistan’s military is fictitious.”
Sporadic shelling has continued along the LoC as a major Indian military crackdown on Jammu and Kashmir (J&K) continues after early last week New Delhi voted to revoke the Muslim majority region’s autonomous status.
A complete communications blackout and state of martial law has continued in the restive region. Recently Pakistan’s Prime Minister Imran Khan has vowed to support Kashmir amid the Indian crackdown “with all possible options”.
Analysts have predicted that India revoking J&K’s status could send it hurtling towards war with its nuclear-armed Muslim neighbor Pakistan.
via ZeroHedge News https://ift.tt/2KCgkpe Tyler Durden
One week ago, and just days before Wednesday’s market plunge and curve inversion, Nomura’s quant team – correctly – predicted that the early August rally was a head fake, and warned that any such rally “should be best treated as an opportunity to sell in preparation for the second wave of volatility” that the bank expects will arrive in late August or early September. Worse, as Nomura quant Masanari Takada said, “the second wave may well hit harder than the first, like an aftershock that eclipses the initial earthquake. At this point, we think it would be a mistake to dismiss the possibility of a Lehman-like shock as a mere tail risk.”
Since then a lot of things happened, but none more memorable than the inversion of the 2s10s curve – the most respected leading recession indicator – for the first time since 2007 following dismal economic data from both China and Germany. And, as Nomura’s quant team points out, “the trauma in global bond markets worked its way into equity markets as well, such that stock markets in the West—and especially in the US—underwent a massive sell-off.”
The result was that Nomura’s composite measure of US stock market sentiment swiftly dropped from -2.6 on 13 August to -6.5 on 14 August, while its measure of global stock market sentiment similarly fell from -3.1 to -4.8, both levels not seen since December’s mini bear market.
The other immediate result: the boost the market got on the previous day (13 August) from the postponement of a portion of the fourth round of US tariffs on Chinese goods evaporated almost immediately, putting a quick end to the relief rally in US stocks, and as Takada argued in his Wednesday note, sustaining the rally would depend on
the S&P 500 regaining the 2,960 line,
the VVIX settling down to around 90, and
a 10yr-2yr UST yield curve that resists becoming inverted.
By all three measures, yesterday’s developments were a complete rout, as the S&P 500 was sold down to 2,840, the VVIX rose to 113, and the 10-2 spread inverted, according to Takada. All of this is to say that the market seems to be experiencing just the sort of tense summer Nomura had anticipated, “raising the likelihood of the second “vol-up” wave that we have been warning may arrive in late August or early September.”
* * *
So if a vol explosion and/or a “Lehman shock” is indeed coming, how should one be positioned?
First of all, according to Nomura, there is little in the way of developments on the horizon that could help solidly reestablish a normal 10yr-2yr UST yield curve, so the bank thinks it makes sense for now to stay bearish on global equities and bullish on global bonds (sovereign debt).
Additionally, the bank’s quants see a high risk of the market unwittingly launching itself into a pattern of trades that make a recession essentially self-fulfilling, barring the emergence (by the end of August) of some positive news powerful enough to turn the tide, such as
the withdrawal of the fourth round of tariffs on Chinese goods,
an emergency rate cut by the Fed on the order of 50-100bp (or an implicit promise to make such a cut), or
reports to the effect that a coordinated fiscal response is on the way.
Absent these highly unlikely events, Nomura warns investors not to be swayed by day-to-day headlines that do not add up to one of these three things, and should consider strategies built around the assumption that a second “vol-up” wave is coming. In that context, Nomura has 4 key trade recommendations:
1. Buy low-beta & defensive stocks, sell high-beta & cyclical stocks: There is a loose correlation between the inversion of the 10-2 spread in DM bond markets and the relative performance of defensives vs. cyclicals in global equity markets (MSCI ACWI). The bond market’s track record in predicting recessions is somewhat less than perfect, but it makes sense to conservatively shift into low-beta & defensive stocks on the assumption that stock market players as well will become more fearful of a recession
2. Too soon to start contrarian buying in the hope of riding a bear squeeze rally in equity futures: CTAs and other speculative players are still net long US equities. Buying in now would mean trying to catch a falling knife, according to Takada; instead, a better opportunity may come in perhaps two weeks’ time. As the Nomura quant notes, “the right time to consider taking out contrarian long positions with the aim of capturing a bear squeeze rally would be when CTAs have cleared away their outstanding longs and have started taking on shorts.”
3. Still favoring long positions in the VIX and other measures of implied equity volatility, as the time for going short would be after the second “vol up” wave: CFTC data shows speculative players (non-commercial traders) to still have a net short position in VIX futures, to the tune of 80,000 contracts as of 6 August. Given the backwardation of the VIX futures curve between UX1 and UX2, speculators are likely to continue buying VIX futures to cover shorts.
4. Contrarian trades on indicators of fundamentals: Global markets are likely to increasingly press the Fed to cut interest rates substantially. Therefore expect stock market players to apply the “good news is bad news” reading to incoming US macroeconomic data.
Last but not least, beware of a self-fulfilling recession.
The inversion of the 10yr-2yr UST yield curve put a quick end to the relief rally in US stocks, and thereby seems to have pushed US stock market sentiment into a pattern that suggests further, significant deterioration ahead.
As Nomura concludes, “the inauspicious pattern in US stock market sentiment could well be signaling that a self-fulfilling recession is on the way.”
via ZeroHedge News https://ift.tt/31IrS00 Tyler Durden
The sprawling Bureau of Prisons (BOP) is one of the most opaque, tight-lipped, and slow-moving agencies in the entire federal government, and yet it sprang into action following the apparent suicide of Jeffrey Epstein, a mysterious billionaire who was rearrested in July on accusations of sex trafficking.
U.S. Attorney General William Barr said he was “appalled” by the news that Epstein had died of an apparent suicide in a federal lockup in Manhattan. He also announced that the Justice Department had already uncovered “serious irregularities” at MCC New York, the jail where Epstein died.
The Bureau of Prisons has already reassigned the warden of the jail, and news outlets reported that guards who were supposed to be monitoring Epstein were literally sleeping on the job and falsifying jail logs to cover up their lapses.
The “serious irregularities” that the Justice Department suddenly uncovered are everyday occurrences within the BOP, and anyone who’s bothered to pay attention to the federal prison system has known about them for years. The real irregularity is that the Justice Department is acknowledging the problems’ existence.
USA Todayreported last year on critical staff shortages at federal prisons that resulted in nurses and other auxiliary staff being pressed into guard duty. This January, congressional investigators released a report finding that serious misconduct at BOP is “largely tolerated or ignored altogether.”
“Clusterfuck doesn’t begin to describe the current state of the BOP, and it dates far beyond the Trump administration,” David Safavian, deputy director of the American Conservative Union Foundation’s criminal justice reform center, toldThe Marshall Project this week. “Anyone who thinks BOP is a high performing organization has never been inside a federal prison.”
Part of the problem is that the BOP is its own secretive fiefdom. It’s incredibly hard for reporters, family members, and civil liberties groups to find out what goes on behind prison walls, much less hold officials accountable.
For example, Reason has been waiting since April for records from BOP regarding the death of several inmates at FCI Aliceville, a federal women’s prison in Alabama. I received a tip from a mother whose incarcerated daughter sent her a message saying women there were dying due to medical neglect:
Today the 4th person died since I have been here. She died in medical at around 1 p.m. after sitting in medical complaining of chest pains since 8 a.m….. waiting to be seen…. My friend from my unit was in medical with her and described the lack of concern shown to this poor woman…. her family I pray learns the truth of how she died…. in the hallway slumped over in a wheelchair, until she fell out onto the floor dying, lying there with no one rushing over to assist her—praying for an ambulance that never came.
The BOP confirmed the names in three of these cases to me, but declined to provide any more information on the causes or circumstances of the deaths.
The family of Rick Turner is waiting for answers, too. Turner, a nonviolent drug offender, died in a maximum-security penitentiary in June. His family had begged BOP to relocate him, saying he feared for his life in the gang-ridden prison, and a member of Congress sent inquiries about his case, all to no avail.
I tried to get records on Turner’s death, but BOP rejected my Freedom of Information Act (FOIA) request, citing an ongoing investigation.
And for the last year, I’ve been trying to get to the bottom of what happened to Michael Monsivais, a former federal inmate who says correctional officers at FCI Lompoc, a federal prison complex in California, threw flashbang grenades on him and two other inmates while they were lying prone on the ground.
Monsivais, who was doing time for a drug offense, had a good reputation at Lompoc and had convinced the BOP bureaucracy, through years of tireless lobbying, to let him start an industry-certified vocational welding program for inmates.
On the night of June 21, 2017, a large fight broke out between two gangs at the prison. Monsivais wasn’t anywhere near the fight. He was in a separate housing unit for the Residential Drug Abuse Program (RDAP). The RDAP is the only program through which federal inmates can reduce their sentences, and as such, the lucky ones who are accepted into it aren’t looking for trouble.
In interviews and written statements, Monsivais and other former Lompoc inmates in the RDAP unit say that about an hour after the fight started, they were in their dorm getting ready for lights-out when they were ordered to stand by their bunks. They assumed they were about to be counted, but corrections officers yelled at everyone to get on the floor and, seconds later, threw flashbangs that landed on top of Monsivais’ and another inmate.
“So two of these grenades exploded next to my leg and blew the sweats off the left side of my leg,” Monsivais recalls. “And it burned me from my ankle all the way to my upper thigh, all the way down my left arm and parts of my left side.”
“Blew his entire pants off,” says Donald Konshuk, another former Lompoc inmate in the unit that night. “Burned his legs, shrapnel in his legs—him and a couple of other people that were right there.”
Monsivais’ bunk was the closest to the door, which is why he says he was hit. Ramon Daniel, another inmate in the RDAP unit, was assigned to the second closest bunk and says he was struck by two flashbang grenades.
“One of them landed by my left foot, blew up and broke my left toe,” Daniel says. “I can not repair it—unrepairable. I went to the doctors, and they can’t do anything about it. The next one fell on my right leg where it blew up. I had plastic balls in my legs that I removed two days later by myself because medical said, ‘We don’t have any time to give you any attention.'”
Monsivais was then thrown in the SHU—”special housing unit,” a sanitized term for solitary confinement—for 71 days. He says he was told he was being investigated for his possible role in the fight, but he and other inmates believe it was to cover up what happened. His fellow inmates wrote statements in his defense, for all the good that did. When he was finally cleared and let out of the SHU, he had to start the nine-month RDAP program again from scratch, pushing back his release date.
Monsivais says the grievances he filed were all dismissed, which is typical. FOIA records obtained by HuffPost in 2017 show that a minuscule number of inmate complaints against BOP officials are sustained.
Other former Lompoc inmates from the RDAP dorm confirmed Monsivais’ story but didn’t want to give their names, as they were still in halfway houses and feared retaliation from BOP (All of the former inmates I spoke to said institutional retaliation is a fact of life in the federal prison system.
“Michael Monsivais, he got done dirty,” one former Lompoc inmate says. “They did him wrong.”
Monsivais and Daniel said prison officials took pictures of their injuries, but BOP has stonewalled attempts to get them. When Monsivais filed a FOIA request for records on the incident, BOP completely withheld 65 out of 67 pages of records. Monsivais gave me a privacy waiver so I could put in a request for his inmate files, but BOP withheld 97 pages in total from me.
I don’t know if the pictures are hidden away in those pages, and without the photos, Monsivais has been unable to drum up much interest from reporters or civil rights lawyers in his case.
In the meantime, he’s launching a nonprofit, No More Locked Doors, that will place formerly incarcerated people in union trade jobs like welding, but the night of June 21, 2017, still gnaws at him.
“I’m a very stubborn and persistent individual, and based on everything I accomplished over there, they should know that. But I guess they’re making the bet that I’m going to just go away and get overwhelmed out here with life,” he says. “What they did to us was wrong, and I believe it’s something worth standing up for.”
People reach out to reporters when the government fails them. I tried, but I haven’t been able to prove yet whether Michael Monsivais was a victim of brutality, or whether a woman at FCI Aliceville died in a hallway waiting for someone to take her pleas seriously, or whether Rick Turner—a “kind, compassionate man” according to an email I received from a woman who worked with him at a children’s hospital—was murdered just like he said he would be.
Meanwhile, Epstein’s death, a giant embarrassment for the Justice Department, is being investigated by the Justice Department Inspector General, the FBI, and the House Judiciary Committee.
The Justice Department could investigate all these incidents, and who knows how many hundreds of others that go unreported within our prisons, and inform the American people. But apparently, you have to be a high-profile scandalous billionaire to get that kind of attention.
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I always try to be a rules-driven investor. And when the US stock market is down -3% in a day, taking it to -6% from its peak in three weeks, when 10-year US treasury yields have halved in nine months to just 1.55%, and when gold is up 20% in three months, it is a good time to review those rules to see what they can tell me. The answer is: quite a lot.
One of the core tenets of my approach to portfolio construction is that to hedge the equity portion of my portfolio, I know I can use gold if the economy is in an inflationary period, and long-dated US treasury bonds if it is in a disinflationary interlude.
The trick is to determine whether the economy is in an inflationary period or not. I tend to look at the markets. If gold has outperformed the 10-year US treasury over the previous five years, I can stop asking questions and hedge with gold. Conversely, if the bond market has outperformed, I can go ahead and hedge with long bonds, providing its valuation is not too demanding.
Now please take a look at the chart below. The upper pane shows the price of gold plotted against the total return index of the 10-year treasury. The lower pane shows the ratio of the two series. Looking at the ratio, it is clear that from 1971 to 1984, investors should have used gold as their hedge. From 1985 to 2002 they should have chosen US long bonds; then from 2003 to 2012 gold, and from 2014 to May 2019 US long bonds once again.
Since May 2019, when the treasury total return/gold ratio fell below its five-year moving average, I have been recommending that investors switch from overvalued bonds to gold as the preferred hedge for their equity exposure (see The Inflation Shift And Portfolio Construction).
Usually, these two assets—long-dated US treasuries and gold—tend to be negatively correlated. When treasuries are going up, gold tends to go down, and vice versa.
But in the last few months, both have powered ahead at the same time. This left me scratching my head, and as usual when puzzled, I reached for the history books to see when in the past both treasuries and gold have looked overbought at the same time. Specifically, I looked for other occasions when the three-month rate of change for each asset was above its respective standard deviation at the same time. The conclusion is striking: we are in a panic.
There were plenty of market panics in the 1970s, when real rates were negative. Then from 1980 to 2007, when short rates were “normal”, they were almost non-existent. However since 2007, there have been several occasions when—unusually—both treasuries and gold went up at the same time.
Here they are:
The beginning of the global financial crisis.
The end of the global financial crisis.
The bond market meltdown in peripheral Europe which prompted Mario Draghi’s “whatever it takes” put.
The slowdown in China which led to the G20 “Shanghai agreement”.
The latest panic.
Each previous panic was dealt with by governments and—more importantly —central banks, including the Chinese central bank, ganging up to stop the rout. However, given the current chill in relations between Washington and Beijing over trade and technology, it is hard to believe that the latest episode will be halted thanks to a cozy cooperation deal between Donald Trump and Xi Jinping.
So what should investors do? My immediate advice would be to do very little right now. Acting in the middle of a panic is seldom a good idea. I would just continue selling bonds, and so raising cash.
Structurally, I maintain my call to hedge the equity risk in a portfolio with gold, since bondholders are most likely to be the victims of the next crisis. Indeed, I believe that in the next crisis, trading in some bond markets may be discontinuous, as in Argentina in recent days (see Lessons From The Argentine Shock). In the coming crisis, I fear there may be very little to choose between some European bond markets and Argentina.
Investors who believe the Hong Kong situation will not deteriorate further (see Hong Kong Q&A (Part II)) should hold on to their Chinese bonds (over the last 12 months, the 10-year Chinese government bond is up 7% in US dollar terms, handsomely outperforming the total returns on both one-year US T-bills and the S&P 500). And they should concentrate their equity holdings in high quality stocks relatively immune from the vagaries of governments, and hedge them with gold.
Praying might also help.
via ZeroHedge News https://ift.tt/33BSbGY Tyler Durden
The sprawling Bureau of Prisons (BOP) is one of the most opaque, tight-lipped, and slow-moving agencies in the entire federal government, and yet it sprang into action following the apparent suicide of Jeffrey Epstein, a mysterious billionaire who was rearrested in July on accusations of sex trafficking.
U.S. Attorney General William Barr said he was “appalled” by the news that Epstein had died of an apparent suicide in a federal lockup in Manhattan. He also announced that the Justice Department had already uncovered “serious irregularities” at MCC New York, the jail where Epstein died.
The Bureau of Prisons has already reassigned the warden of the jail, and news outlets reported that guards who were supposed to be monitoring Epstein were literally sleeping on the job and falsifying jail logs to cover up their lapses.
The “serious irregularities” that the Justice Department suddenly uncovered are everyday occurrences within the BOP, and anyone who’s bothered to pay attention to the federal prison system has known about them for years. The real irregularity is that the Justice Department is acknowledging the problems’ existence.
USA Todayreported last year on critical staff shortages at federal prisons that resulted in nurses and other auxiliary staff being pressed into guard duty. This January, congressional investigators released a report finding that serious misconduct at BOP is “largely tolerated or ignored altogether.”
“Clusterfuck doesn’t begin to describe the current state of the BOP, and it dates far beyond the Trump administration,” David Safavian, deputy director of the American Conservative Union Foundation’s criminal justice reform center, toldThe Marshall Project this week. “Anyone who thinks BOP is a high performing organization has never been inside a federal prison.”
Part of the problem is that the BOP is its own secretive fiefdom. It’s incredibly hard for reporters, family members, and civil liberties groups to find out what goes on behind prison walls, much less hold officials accountable.
For example, Reason has been waiting since April for records from BOP regarding the death of several inmates at FCI Aliceville, a federal women’s prison in Alabama. I received a tip from a mother whose incarcerated daughter sent her a message saying women there were dying due to medical neglect:
Today the 4th person died since I have been here. She died in medical at around 1 p.m. after sitting in medical complaining of chest pains since 8 a.m….. waiting to be seen…. My friend from my unit was in medical with her and described the lack of concern shown to this poor woman…. her family I pray learns the truth of how she died…. in the hallway slumped over in a wheelchair, until she fell out onto the floor dying, lying there with no one rushing over to assist her—praying for an ambulance that never came.
The BOP confirmed the names in three of these cases to me, but declined to provide any more information on the causes or circumstances of the deaths.
The family of Rick Turner is waiting for answers, too. Turner, a nonviolent drug offender, died in a maximum-security penitentiary in June. His family had begged BOP to relocate him, saying he feared for his life in the gang-ridden prison, and a member of Congress sent inquiries about his case, all to no avail.
I tried to get records on Turner’s death, but BOP rejected my Freedom of Information Act (FOIA) request, citing an ongoing investigation.
And for the last year, I’ve been trying to get to the bottom of what happened to Michael Monsivais, a former federal inmate who says correctional officers at FCI Lompoc, a federal prison complex in California, threw flashbang grenades on him and two other inmates while they were lying prone on the ground.
Monsivais, who was doing time for a drug offense, had a good reputation at Lompoc and had convinced the BOP bureaucracy, through years of tireless lobbying, to let him start an industry-certified vocational welding program for inmates.
On the night of June 21, 2017, a large fight broke out between two gangs at the prison. Monsivais wasn’t anywhere near the fight. He was in a separate housing unit for the Residential Drug Abuse Program (RDAP). The RDAP is the only program through which federal inmates can reduce their sentences, and as such, the lucky ones who are accepted into it aren’t looking for trouble.
In interviews and written statements, Monsivais and other former Lompoc inmates in the RDAP unit say that about an hour after the fight started, they were in their dorm getting ready for lights-out when they were ordered to stand by their bunks. They assumed they were about to be counted, but corrections officers yelled at everyone to get on the floor and, seconds later, threw flashbangs that landed on top of Monsivais’ and another inmate.
“So two of these grenades exploded next to my leg and blew the sweats off the left side of my leg,” Monsivais recalls. “And it burned me from my ankle all the way to my upper thigh, all the way down my left arm and parts of my left side.”
“Blew his entire pants off,” says Donald Konshuk, another former Lompoc inmate in the unit that night. “Burned his legs, shrapnel in his legs—him and a couple of other people that were right there.”
Monsivais’ bunk was the closest to the door, which is why he says he was hit. Ramon Daniel, another inmate in the RDAP unit, was assigned to the second closest bunk and says he was struck by two flashbang grenades.
“One of them landed by my left foot, blew up and broke my left toe,” Daniel says. “I can not repair it—unrepairable. I went to the doctors, and they can’t do anything about it. The next one fell on my right leg where it blew up. I had plastic balls in my legs that I removed two days later by myself because medical said, ‘We don’t have any time to give you any attention.'”
Monsivais was then thrown in the SHU—”special housing unit,” a sanitized term for solitary confinement—for 71 days. He says he was told he was being investigated for his possible role in the fight, but he and other inmates believe it was to cover up what happened. His fellow inmates wrote statements in his defense, for all the good that did. When he was finally cleared and let out of the SHU, he had to start the nine-month RDAP program again from scratch, pushing back his release date.
Monsivais says the grievances he filed were all dismissed, which is typical. FOIA records obtained by HuffPost in 2017 show that a minuscule number of inmate complaints against BOP officials are sustained.
Other former Lompoc inmates from the RDAP dorm confirmed Monsivais’ story but didn’t want to give their names, as they were still in halfway houses and feared retaliation from BOP (All of the former inmates I spoke to said institutional retaliation is a fact of life in the federal prison system.
“Michael Monsivais, he got done dirty,” one former Lompoc inmate says. “They did him wrong.”
Monsivais and Daniel said prison officials took pictures of their injuries, but BOP has stonewalled attempts to get them. When Monsivais filed a FOIA request for records on the incident, BOP completely withheld 65 out of 67 pages of records. Monsivais gave me a privacy waiver so I could put in a request for his inmate files, but BOP withheld 97 pages in total from me.
I don’t know if the pictures are hidden away in those pages, and without the photos, Monsivais has been unable to drum up much interest from reporters or civil rights lawyers in his case.
In the meantime, he’s launching a nonprofit, No More Locked Doors, that will place formerly incarcerated people in union trade jobs like welding, but the night of June 21, 2017, still gnaws at him.
“I’m a very stubborn and persistent individual, and based on everything I accomplished over there, they should know that. But I guess they’re making the bet that I’m going to just go away and get overwhelmed out here with life,” he says. “What they did to us was wrong, and I believe it’s something worth standing up for.”
People reach out to reporters when the government fails them. I tried, but I haven’t been able to prove yet whether Michael Monsivais was a victim of brutality, or whether a woman at FCI Aliceville died in a hallway waiting for someone to take her pleas seriously, or whether Rick Turner—a “kind, compassionate man” according to an email I received from a woman who worked with him at a children’s hospital—was murdered just like he said he would be.
Meanwhile, Epstein’s death, a giant embarrassment for the Justice Department, is being investigated by the Justice Department Inspector General, the FBI, and the House Judiciary Committee.
The Justice Department could investigate all these incidents, and who knows how many hundreds of others that go unreported within our prisons, and inform the American people. But apparently, you have to be a high-profile scandalous billionaire to get that kind of attention.
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Jeffrey Epstein’s former bodyguard and driver has backpedaled over 2015 comments he made to former Daily Beast reporter M.L. Nestel, at one point sugesting he drop the story and stop asking questions about Epstein’s pedophilia.
Nestel, now with New York Magazine, was able to reach the former UFC fighter, Igor Zinoviev, who was happy to answer questions about shuttling Epstein around Palm Beach and training the ‘pretend billionaire’ via workouts and light martial arts, the Russian MMA competitor clammed up when the topic shifted to Epstein’s crimes.
You were Jeffrey Epstein’s driver? You weren’t just his bodyguard and trainer?
Yep.
You drove him in all three places?
In New York, I didn’t drive him. In New York, he had a driver, whatever his name was. He was like old family. I was just training with him in New York and travel with him. And I just drove him here in Palm Beach. Because other places he had different drivers. They’re just personnel, you know, who just drive him. Somebody drive him in New Mexico. Somebody drive him in Virgin Islands, actually. I just drove him here in Palm Beach.
You went with him to all the other properties? Did you go with him to New Mexico also?
Yeah.
You worked with him and traveled with him 24/7 — so that means you were on his plane with him, correct?
Yeah.
You lived in his guest house?
Yeah.
***
Now things get uncomfortable as Zinoviev backpedals on statements he made in 2015.
***
In our conversation in 2015, you described his relationship with teenage girlfriends: “So many time I tried to stop him. I try to tell tell him my opinion about that. He don’t listen to me. That’s the reason why I’m not working for him no more. I make him do that — to let me go.” Do you remember saying that?
It’s not the teenage girls. I never see the teenage girls. I tell you I never see teenage girls.
Plenty of times when I work for him I never see anything unproper or teenage girls around him.
That’s what I say.
So now you say you only saw him with women? Older than 18? 20?
All what I say he has always been with girlfriends and therewas a couple girls — I don’t remember their names. She was 25 and worked for him as assistant. Maybe 25 or 23 — whatever, I don’t know the age.
Okay. But you definitely told me that last time we talked.
No, no. It’s not that. He working like work-release on other stuff. And I just tell him, you know, he would order his girlfriends around, and I told him, “Calm down.” It’s not just teenage girls.
I never see teenage girls in my life at his house. That’s what it is. That’s a misunderstanding. Completely. That’s because — that’s what I’m saying. Most of the time with reporters they give me that kind of questions. “Who told you I see the teenage girls?” I never see the teenage girls in my life. And they said I was —
Here’s another thing you said last time about Epstein and the girls you saw at his house — specifically about moments when you were trying to offer him advice about his conduct: “Sometimes he tries to make a joke. He’d say, ‘Thank you, Grandma. I don’t need your opinion.’ So when you tried to do something good, he would try to make a joke in front of his girls. I never give anyone any questions. It’s one of my rules actually. I be honest with you. I never ask any of my clients what they do for a living or how they do whatever they do. I just do my job, and that’s it.”Do you remember saying that?
Yes, that’s what I say. I feel like the cops watching me whenever he’s on work release — I tell him, “Don’t do stupid stuff.” Like, “[Don’t] put your girlfriend in the car and drive together.
Don’t! Watch it out — all the extra attention.”
Epstein made fun of you in front of the girls, right?
Yeah. Yeah, that was his thing, yeah.
You said you never ask your employers questions.
Yeah. That’s normal answer. People like him just do whatever he wants to do. Because like people talking and just — they already have some release and I understand and just read some papers about his like, whatever, “teenage girls.” But that was [how] he answers. That’s it. So I don’t know.
Here’s another quote from our last interview:“He had a couple girlfriends. They have no idea the degree of what they are doing. But you can’t tell nothing to them. Because they support him kind of. For the while, this one girl can be more attached to him, he just fire her. Fire them and keep them away. For example, I give you some idea: You have private plane and you have three girlfriends and one girl can be more attached to him. And next week — he don’t take that girl. He takes another one, and he just switch them. He brings them on a couple trips and then get different girls. That’s what he doing.”Remember that?
Kind of not!
Igor.
Wait a minute. Wait a minute.
I understand this is sensitive —
It’s not sensitive — it’s just — kind of a little uncorrect.
It’s exactly what you said. I can send it to you. Here’s something else you said: “It could be tricky you know. Normally he always checks his newspapers — ‘Nothing about me?’ I say, ‘No!’ He say, ‘They forget about me?’” And when I mentioned Epstein was being exposed for messing with teenage girls, you said: “I’m not surprised at all. I’m just surprised how low he can be outside the real world. Someday is going to call him and it will be real jail. He have so much money he can pay it off. Me personally, if I caught him with my daughter or something do that — I’m not going to go to police. I do something else. Much worse. That guy could try to sue me and manipulate the situation with his money. That’s the American way. I know he screwed up a lot of fashion girls also. That’s a different story. [Laughs.]”Do you remember saying that?
I remember one thing: I say like, “If I be the father and somebody screw up my daughter, I don’t give shit with how much money he have. I definitely do some bad thing.” That’s what I said. Before that stuff, I don’t know. I’m just really like —
Igor, I’m not making stuff up. I was very careful.
I’m really careful, too.
It was four years ago. You may not remember what you told me. I kept very good notes of what you and I said. It must come across as very harsh. But it’s the truth. I’m happy to understand a little better. He’s not alive. You don’t have anything to be afraid of anymore.
I’m not afraid. Beyond that just he is dead. I don’t want anything to be uncorrect. There’s too much shit in here, you know, already. He’s dead and just like, freaking people, just leave him alone.
Hold on. When did you find out he died?
Saturday or Sunday or whenever.
What did you think when you found that out?
What did I think?
Yeah.
Are you sure you want to hear what I am going to think?
Yeah.
Somebody helped him to do that.
You think somebody helped him kill himself?
Yeah.
Okay. Why?
Listen, you know, that’s going a little too deep.
I mean, I’m just trying to understand that maybe you’d be happy he was dead or you would be upset. I don’t know. Are you even feeling anything?
I’m not sad. I mean, I didn’t have anything against him, like a bad thing, you know? I don’t care about his life completely. I don’t give a, let’s say, like, crap about how he die, how he live, or how he’s managed.
How many years did you live at his house?
Five or six years. In Palm Beach.
That’s a long time.
Yeah.
You don’t have any emotion after learning he’s dead?
No.
Did you think that would happen to him?
It’s unexpectable. Well —
***
One thing you told me, for instance — okay, one thing you told me is he got a heads up when the authorities were going to come to his house the night before.
Listen, what you say is between you and me —
You told me he would get phone calls the night before and eight o’clock the police are going to come. He would get a heads up from local police.
[Silence.]
You told me that, Igor. Want me to read the quote?
Well, you can read whatever you want right now. Don’t just — you can put yourself in big trouble.
You said: “He always do something wrong. There was some nights in question. There was at home arrest and police, before they come to the house, they call him and tell him they coming in at eight o’clock in the morning. It’s all corruption you know. It’s all bullshit.”
Listen, don’t put yourself in trouble. Seriously.
We talked about this.
I understand we got this.
I’m telling you to give you a chance to remember because we talked about this stuff. I know it’s hard. I don’t know what you mean about “put myself in trouble.”
Let that go. Seriously. Let that go.
Why is it so important? Are you worried about the local cops?
Listen, you’re really smart and I’m not going to offer that over the phone right now, okay? You’re really smart. You have no idea. Please!
What do you mean by that?
I can’t explain you. I can’t explain you over the phone any of this.
You said that last time. And we didn’t talk for years. You can tell the world who this guy was. You were with him for a long time. You know what I mean?
[Silence.]
I totally understand that you think he could have had help committing suicide.
First of all, I have to go right now. I have another client.
Still training people?
Yes. But just be careful. I’m not kidding.
What’s your email so I can send you —
Don’t do any kind of that stuff. Just don’t play it. Seriously.
Can you tell me why?
I can’t. I can’t.
May I ask you one more question?
Go ahead.
Have you been talking to anyone in the government, the FBI? Have they come to you?
[Long pause] Um. Great talking to you. Seriously. We talk later.
Really?
Bye.
All right.
Bye.
via ZeroHedge News https://ift.tt/2KPxGh7 Tyler Durden
The Food and Drug Administration (FDA) proposed new regulations today that would require cigarette packaging to sport graphic depictions of smoking’s possible health consequences.
“While most people assume the public knows all they need to understand about the harms of cigarette smoking, there’s a surprising number of lesser-known risks,” said Acting FDA Commissioner Ned Sharpless in a statement announcing proposed new regulations. “Given that tobacco use is still the leading cause of preventable disease and death in the U.S., there’s a lot at stake to ensure the public understands these risks.”
These “lesser-known” risks include lung disease, head and neck cancer, bladder cancer, erectile dysfunction, and diabetes. The new labels will also warn smokers about the damage their smoking might be doing to children and unborn babies.
This is not the first time that the FDA has tried to put graphic warning images on cigarettes. In 2009, Congress passed a law giving the agency the power to regulate tobacco products for the first time. That same law actually required the FDA to come up with graphic health warnings that would cover half of every cigarette packet and 20 percent of every tobacco advertisement.
In 2010, the FDA unveiled some remarkably gruesome warning labels that looked closer to a death metal album cover than something from a public health agency. The proposed labels included a picture of cadavers, diseased lungs and teeth, and a baby weeping in an incubator.
In 2012, a federal court ruled that the FDA’s new warning labels amounted to a First Amendment violation. By sensationalizing and overhyping the risks of smoking, the agency was compelling speech on the part of tobacco companies, U.S. District Court Judge Richard Leon ruled.
Any warning labels, Leon ruled, would have to be purely informational.
The ruling left the FDA between a rock and a hard place. By law, they were required to put new graphic labels on cigarette packets. The 2012 court ruling left them unsure about which warning labels might pass constitutional muster.
The result, The New York Times reports, is that the agency dragged its feet for years until a 2016 lawsuit by anti-smoking advocates eventually forced them to take another stab at crafting warning labels.
Other targeted industries have successfully challenged warning labels on free speech grounds. In January, a coalition of beverage, retail, and advertising trade groups successfully challenged the constitutionality of a San Francisco ordinance that required soda advertisements to include warnings about tooth decay and obesity.
The U.S. Court of Appeals for the 9th Circuit ruled that San Francisco’s requirement that these warnings take up 20 percent of any soda advertisement was overly burdensome. A smaller warning label could have achieved the government’s public health interests, the court said.
Whether tobacco companies will try to challenge these new, still pretty gruesome, warning labels on similar First Amendment grounds remains to be seen.
The FDA’s draft rules will still be subjected to public comment and revision.
At the same time as the FDA is trying to get people to quit smoking with flashy new warning labels, the agency is also making smoke-free alternatives to cigarettes less appealing.
Last week, the FDA ordered four companies to remove 44 flavored vaping and hookah products from the market. The agency has been cracking down on flavored e-cigarette products as part of its anti-teen vaping efforts.
As Reason‘s Jacob Sullum has noted, however, many adults prefer flavored e-cigarette products. Making e-cigarettes less attractive runs the risk that people will be less likely to switch from traditional cigarettes to less dangerous vaping products.
Cigarette smoking, like so many vices in life, involves a trade-off between risk and reward. Fortunately for those concerned about the health effects of smoking, there is no shortage of non-profit groups and government agencies who are happy to stress the risk side of that equation.
The FDA’s new warning labels, however, go beyond the mere provision of information. The agency is actively hijacking tobacco companies’ products in order to spread its own anti-smoking message. Relaying public health information shouldn’t have to come at the expense of corporations’ free speech and property rights.
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The Food and Drug Administration (FDA) proposed new regulations today that would require cigarette packaging to sport graphic depictions of smoking’s possible health consequences.
“While most people assume the public knows all they need to understand about the harms of cigarette smoking, there’s a surprising number of lesser-known risks,” said Acting FDA Commissioner Ned Sharpless in a statement announcing proposed new regulations. “Given that tobacco use is still the leading cause of preventable disease and death in the U.S., there’s a lot at stake to ensure the public understands these risks.”
These “lesser-known” risks include lung disease, head and neck cancer, bladder cancer, erectile dysfunction, and diabetes. The new labels will also warn smokers about the damage their smoking might be doing to children and unborn babies.
This is not the first time that the FDA has tried to put graphic warning images on cigarettes. In 2009, Congress passed a law giving the agency the power to regulate tobacco products for the first time. That same law actually required the FDA to come up with graphic health warnings that would cover half of every cigarette packet and 20 percent of every tobacco advertisement.
In 2010, the FDA unveiled some remarkably gruesome warning labels that looked closer to a death metal album cover than something from a public health agency. The proposed labels included a picture of cadavers, diseased lungs and teeth, and a baby weeping in an incubator.
In 2012, a federal court ruled that the FDA’s new warning labels amounted to a First Amendment violation. By sensationalizing and overhyping the risks of smoking, the agency was compelling speech on the part of tobacco companies, U.S. District Court Judge Richard Leon ruled.
Any warning labels, Leon ruled, would have to be purely informational.
The ruling left the FDA between a rock and a hard place. By law, they were required to put new graphic labels on cigarette packets. The 2012 court ruling left them unsure about which warning labels might pass constitutional muster.
The result, The New York Times reports, is that the agency dragged its feet for years until a 2016 lawsuit by anti-smoking advocates eventually forced them to take another stab at crafting warning labels.
Other targeted industries have successfully challenged warning labels on free speech grounds. In January, a coalition of beverage, retail, and advertising trade groups successfully challenged the constitutionality of a San Francisco ordinance that required soda advertisements to include warnings about tooth decay and obesity.
The U.S. Court of Appeals for the 9th Circuit ruled that San Francisco’s requirement that these warnings take up 20 percent of any soda advertisement was overly burdensome. A smaller warning label could have achieved the government’s public health interests, the court said.
Whether tobacco companies will try to challenge these new, still pretty gruesome, warning labels on similar First Amendment grounds remains to be seen.
The FDA’s draft rules will still be subjected to public comment and revision.
At the same time as the FDA is trying to get people to quit smoking with flashy new warning labels, the agency is also making smoke-free alternatives to cigarettes less appealing.
Last week, the FDA ordered four companies to remove 44 flavored vaping and hookah products from the market. The agency has been cracking down on flavored e-cigarette products as part of its anti-teen vaping efforts.
As Reason‘s Jacob Sullum has noted, however, many adults prefer flavored e-cigarette products. Making e-cigarettes less attractive runs the risk that people will be less likely to switch from traditional cigarettes to less dangerous vaping products.
Cigarette smoking, like so many vices in life, involves a trade-off between risk and reward. Fortunately for those concerned about the health effects of smoking, there is no shortage of non-profit groups and government agencies who are happy to stress the risk side of that equation.
The FDA’s new warning labels, however, go beyond the mere provision of information. The agency is actively hijacking tobacco companies’ products in order to spread its own anti-smoking message. Relaying public health information shouldn’t have to come at the expense of corporations’ free speech and property rights.
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Once upon a time, the quarterly publication of hedge fund 13F statements was a momentous event, more important even than corporate earnings, creating a frenzy of activity within the buyside community as hedge funds scrambled to figure out who is buying – or selling – what, and what such activity telegraphed about the bigger picture.
Alas, over the past decade – ever since SAC’s egregious use of “expert networks” made the legal use of inside information impossible and as central banks took over markets – hedge fund returns collapsed, and so did interest in their holdings. In fact, as we showed time after time, the best strategy since 2013 was not going with the crowd but against it, and as noted two weeks ago, going long the most shorted names and shorting the most popular ones has continued to be not only the most consistently profitable, alpha-generating strategy, but in 2019 YTD, the top 10 crowded stocks underperformed the 10 most neglected stocks by 19% YTD, a 5-year record!
Still, whether one uses it to bet with it or – more likely – against it, a list of what hedge funds buy and sell any given quarter is still informative, if for no other reason than to indicate what the prevailing groupthink regurgitates at various idea dinners across Manhattan.
So, courtesy of Bloomberg, the latest batch of 13-Fs revealed that the recent red-hot IPOs were quite popular among the 2 and 20 crowd, as Coatue, Tiger Global, and Viking Global all disclosed the value of their positions in struggling-IPO Uber Technologies while its rival Lyft tried to attract big hedge funds.
In what may have been the biggest surprise, billionaire activist investor Bill Ackman unveiled a new big new bet on Warren Buffett’s Berkshire Hathaway, prompting questions among his investors if they should be paying him… or Buffett? Meanwhile, Berkshire itself boosted its bets on Bank of America and Amazon.com.
Elsewhere, BlueMountain disclosed that it converted most of its stake in the bankrupt utility owner PG&E from common shares to swaps, while David Tepper’s Appaloosa bought some Intelsat and sold its entire Alibaba stake.
Also during the quarter, activist giant Elliott Management added a chunk of Marathon Petroleum to its holdings while exiting Sempra Energy. Casino stocks went out of favor last quarter as D1 Capital Partners and Melvin Capital Management were among funds that trimmed their positions in Wynn Resorts Ltd.
Courtesy of Bloomberg, here are the notable holdings changes for the most prominent money managers as of June 30. Top new buys may include IPOs in which hedge funds may have invested prior to their debut:
ADAGE CAPITAL PARTNERS GP
Top new buys: RTN, DUK, ABBV, CF, TEL, COMM, MDU, GRA, COP, SAP
Top exits: IFRX, EXP, BRKMY, LNG, BLD, TAK, WMB, CE, BMY, CMI
But they do share a belief that YouTube and Google are unfairly discriminating against them and censoring their content, and they’re both willing to sue in federal court to put an end to it.
Yesterday, a group of eight LGBT YouTube creators announced a federal class-action lawsuit against Google and YouTube claiming “discrimination, fraud, unfair and deceptive business practices, unlawful restraint of speech, and breach of consumer contract rights” by among other things, demonetizing their videos so that they can’t make money off of advertising, putting age restrictions on their videos, excluding their videos from recommendation algorithms, and otherwise making it harder for YouTube viewers to find their stuff and for them to make money off their works. The plaintiffs produced a video (and are hosting it on YouTube) explaining their lawsuit:
It’s fascinating how much their complaints mirror those by Prager University, which argues that Google and YouTube discriminate against their content because they’re conservatives. In fact, Prager U and these LGBT creators are being represented in their lawsuits by the same firm, Browne George Ross LLP. At their site, Browne George Ross provides a recording of a conversation between one of the plaintiffs, Chris Knight of GlitterBomb TV, and a YouTube advertising representative who told him they wouldn’t accept an advertisement for an episode of the show due to “shocking content,” which was further explained to mean “gay content.” The lawsuit argues that YouTube uses its “restricted mode” not just to block minors from accessing adult content, but to hide away LGBT videos entirely.
The lawsuit, much like the Prager U complaints, leans heavily on the idea that, because YouTube is such a powerful, dominant online hosting system for videos, it’s under an obligation to be “viewpoint-neutral,” and in fact, YouTube claims that they are indeed viewpoint-neutral in their moderation. From the lawsuit:
LGBTQ+ Plaintiffs understand and support effective, but lawful viewpoint-neutral content-based regulations on the platform. But that is not how these Defendants have been operating YouTube during the relevant time period of this lawsuit. Defendants have brazenly abandoned YouTube’s Four Freedoms and hijacked the YouTube Community and the Mission that defines that Community, by continuing to engage in and defend identity, viewpoint, discriminatory, and illegal content-based regulation, distribution and monetization policies that harm YouTube’s LGBTQ+ Community and other YouTube Community members. Requests by the LGBTQ+ Plaintiffs to address these allegations and concerns have been made to Defendants, but not only have these requests fallen on deaf ears, but in the past several weeks, they have been the subject of outright false denials by YouTube’s CEO.
The “Four Freedoms” referenced above are YouTube’s own creation: “Freedom of Expression,” “Freedom of Opportunity,” “Freedom of Information,” and “Freedom to Belong.” The plaintiffs claim that the restrictions and censorship YouTube has inflicted on their channels violate the company’s own standards.
The lawsuit also argues that YouTube isn’t censoring enough when it comes to anti-LGBT speech and hate speech showing up in their channels. The lawsuit complains about advertisements with anti-LGBT speech being placed in front of their videos by YouTube, offending viewers and discouraging them from watching. And the lawsuit further complains about the inability of content creators to effectively police the comments in their channels to weed out hate speech. The lawsuit contends:
The LGBTQ+ Plaintiffs strongly support the right of free Speech and expression for all Community Members. That right does not extend to Defendants’ promotion of anti-LGBTQ+ hate speech, speech which also violates Defendants’ own purportedly neutral content-based rules—especially when Defendants unlawfully use those rules as pretext to censor, restrain, demonetize, silence, and squelch the engagement and distribution of LGBTQ+ video content or viewership. Such, actions unlawfully interfere with the express rights of LGBTQ+ Community Members to protect themselves by speaking out against hate and homophobia on a level playing field, as provided by Defendants’ representations and warranties that the rules apply equally to all on YouTube.
This paragraph seems a bit confusing and muddled. If YouTube were a neutral platform, it wouldn’t be censoring anti-LGBT ads or deleting comments that these plaintiffs deem to be “hate speech.” The argument seems to be that by censoring their videos, but not the hate speech, they’re at a disadvantage.
Of course, there’s tons of pro-LGBT video content all over YouTube. I suspect that much like Prager U, they’re going to have a hard time convincing the government that Google holds some sort of animus against gay and trans people just like they do conservatives.
That’s not to say that there’s nothing of merit in any of these complaints, but they really end up being more about contractual obligations than free speech. The lawsuit notes that Knight’s company paid YouTube more than $14,000 to place ads and then had to fight regularly with YouTube, which frequently refused to accept their ads for vague and unexplained reasons. But this is an issue of whether or not YouTube is meeting its contractual obligations, not a free speech or censorship issue.
The lawsuit, filed in the United States District Court, Northern Division of California, San Jose Division, seeks class-action status, a cease-and-desist order stopping these practices, damages, a penalty of $2,500 for each violation, and attorneys fees.
They want a jury trial, and without trying to guess at the outcome, I’ll note that Prager U has already lost a lawsuit last year over claims like this, as a judge held that YouTube was a private platform and not a “state actor.” The judge also said that simply because YouTube expresses values supporting free speech doesn’t mean it must structure moderation with the First Amendment in mind.
Prager U has filed a new lawsuit, and Dennis Prager has turned to friendly conservatives in the Senate to try to get the federal government involved in setting rules for online platforms. Billy Binion has previously explained how Prager’s analysis that YouTube has some special desire to censor him is misguided, and in reality, his channel’s videos end up restricted far less than those of the History Channel, Democracy Now, and The Daily Show.
The reality is that YouTube is providing a hosting platform so large that there are going to be mishaps and confusion in applying its ultimately subjective regulations. This new lawsuit has entire sections devoted to explaining how YouTube restricted a video because of an appearance of a man’s bare butt, but did not do so at a more popular channel under the same circumstances. Does that sound more like intentional discrimination against LGBTQ, or the result of well-meaning humans and crude algorithms trying to enforce a shifting set of loosely defined content standards? And if federal lawmakers had their way, how many bare butts and kink explainers do you think you’d see on YouTube?
Prager’s lawsuit is completely misguided, and so is this one. If it succeeds, it will likely lead to more censorship on Youtube’s platform. Tech companies that host user-generated content will be less vibrant and less diverse if they have to cater to everyone, a category that includes powerful government leaders who have their own ideas about what messages must be allowed and what must be censored.
Read the LGBT creators’ lawsuit here and the Prager U lawsuit here.
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