Author: admin

The same brokerages that have been notorious for freezing up and locking people out of their accounts during points of volatility over the last year now claim they are ready and well positioned for post-election volatility in markets. 

We’ll believe it when we see it…

Exchanges have also said they “have spent months planning” for dealing with volatility that may arise as a result of the outcome of the election, according to Reuters. With just 6 days left until the election, we are about to find out if they are bluffing or not. 

In addition to brokerages like Robinhood and TD Ameritrade freezing out customers during the volatility induced by the Covid-19 pandemic earlier this year, exchanges like Euronext and the Tokyo Stock Exchange also suffered outages. New Zealand’s stock exchange was hit by cyberattacks in August and in July, a Deutsche exchange was similarly compromised. 

Kevin Kennedy, head of U.S. options at Nasdaq Inc., commented: “This thing could take days, weeks, months, so we embarked on a journey of increasing our capacity by multiple times.”

NASDAQ reportedly started shoring up its exchange after the volatility in March put everybody on notice that it could be an issue. NASDAQ saw its volume of trades increase by 2.5x from their 2019 peaks in March. Options markets saw volumes triple – and just think – this was before Softbank was manipulating the NASDAQ via the options market.

CBOE also says it is taking preparations, including increasing the size of its Chicago based trading floor for additional brokers and market makers: “This was done to ensure adequate liquidity and broker coverage in anticipation of potential expanded volumes and volatility around the election.” 

And while the CBOE and NASDAQ held up mostly well during March, brokerages like Ameritrade and Robinhood – well…didn’t.

During the pandemic volatility, Ameritrade’s website was often slow and many times unusable until the market had been open for an hour or two each morning.

“We’re lining up all available client service resources to be available to assist on the phones. In addition, we are communicating with clients about our election-related education and commentary,” Ameritrade, which is now Schwab, commented.

Robinhood – the startup brokerage that has helped “gamify” the stock market via its app went down on numerous occasions during the first and second quarter of 2020, inciting outrage from its users who couldn’t trade or have access to their funds at arguably one of the most crucial points in the trading year. 

Robinhood commented: “This year, our engineering teams have worked diligently to further harden our infrastructure, improve reliability, and increase capacity.”

We’ll see how well that statement holds up on November 4. 

Authored by Ethan Yang via The American Institute for Economic Research,

If you get your information about American politics from the media, politicians, and even from a lot of Washington, DC think tanks, you’re doing it wrong. It goes without saying that politics is about mass mobilization and power; narratives and oversimplification are the tools of the trade. That would be fine if real-life consequences didn’t come out of half-baked ideas about policy, but guess what, they do. If you find yourself constantly frustrated by the superficial and borderline false explanations given to support various political agendas, then you should look into John Tamny’s latest book, They’re Both Wrong: A Policy Guide for America’s Frustrated Independent Thinkers. The name speaks for itself and Tamny spares no time taking aim at both Conservatives and Liberals, dismantling their frequently peddled narratives, besting their emotional facade with independent, fact-based analysis.

Today, it is rare to find any sort of analysis that resembles Tamny’s independent and truth-focused writing. Few people in politics seem to care about looking a couple inches below the surface and a few steps ahead into the future when it comes to making the case for their policies. Why would they? Politics is war, power is the end that justifies the means, victory is all that matters. If it riles up the masses and gets the right team elected, that’s all they could ask for. The problem with the way all this works however, is that politicians don’t need to live with the consequences of their decisions. The rest of us definitely do. That’s why the level of analysis and thought Tamny exercises in his book is so desperately needed in today’s politics. To bring back some semblance of concern for the consequences of the policies politicians are empowered to make and to usher in some sobriety to the drunken party that is Washington, DC. 

Unlike the other books I review, Tamny’s book doesn’t have some groundbreaking thesis or an ultimate idea. It’s quite straightforward and the title says it all. The book itself is a collection of essays, each touching on a common belief or talking point perpetuated by either the American left or right. Each essay could essentially function as a policy brief discussing with a high degree of detail and insight on why a certain talking point is mistaken. At the end of the book, the reader will have received an introduction into how to think clearly about important issues in American politics. Whether or not you agree with Tamny’s reasoning, you will at least be able to see past the emotional appeal of certain ideas and start thinking about the facts. That is certainly something we can all agree is important, especially today.

Debunking Conservative and Liberal Narratives 

Tamny doesn’t wait to warm up the reader; he goes right for the hot stuff by starting off the book with a chapter on immigration and conservatives. We hear it all the time; “Build the wall,” “Protect American jobs,” and “Immigrants are just here to take welfare.” In an interview with Tamny, I asked him what conservatives are missing when it comes to immigration. 

His answer: “Basic economics.”

According to Tamny, the Conservative aversion to immigration seems to go against everything that they ever believed in and also just falls short of reality. Firstly, how will a wall along the Mexican border help anything? Roughly a thousand people still manage to escape North Korea every year, the most totalitarian regime on the planet. How big is the government going to have to get to fund a border wall over 1,700 miles long and adequately patrol it? Not only is that a silly question but conservatives would be betraying their commitment to limited government. 

When immigrants come to this country they are not here to take welfare. They are here to establish a better life and have a shot at prosperity. That’s why someone would flee Communist North Korea or the Soviet Union for America. Last time I checked, there are more handouts in socialist countries and people leave those countries for places like America. Immigrants want to come to work, not take welfare. Tamny points out in his book that immigration was at its most recent lows during the Obama administration, not the Trump administration. The reason for this is simple; President Obama presided over a worse economy. I’m sure the Obama administration was far more open and accommodating than the Trump administration but immigrants are interested in working. There was more work to go around during the Trump and Bush administrations and the immigration trends follow that.

Tamny writes 

“If immigrants were in fact crossing the border for handouts as conservatives regularly argue, wouldn’t the Obama years have coincided with a massive increase in crossings? Wasn’t Obama all about amnesty and handouts as is?

Furthermore, immigration restrictions to protect workers are basically central planning and antithetical to free markets. A competitive and dynamic workforce is good for everybody. Companies get better choices for workers which in turn produces better services for everyone. Lower costs, more inventions, and more services brought about by immigration produces net benefits for society. 

Just like central planning frequently trips over its own feet in attempting to predict and run all market transactions, so too does attempting to “protect American jobs.” Which jobs are conservatives referring to when they say that? Do they somehow know exactly what jobs are being protected now and forever into the future? How do they know that the immigrants they let in won’t in some way contribute to the creation of new jobs? That’s a silly question because the notion that the government can somehow be an all-knowing and all-powerful benevolent steward of each and every one of our jobs is a fatal conceit. Something a Socialist like Bernie Sanders might think, not a Conservative. 

Tamny has many more chapters where he debunks conservative talking points and dives into the facts surrounding everything from school choice to domestic energy production. 

He also saves equal room for the Liberals to make sure they get their turn to have their bubbles popped.

Just to pick a random topic, Tamny goes after the left hard on their demagoguery over corporations. If you thought Conservatives perpetuated economically questionable and factually dubious narratives about immigration, take a look at how liberal politicians talk about corporations. According to labor unions and their allies in politics, you would think that we all live under the boot of corporate tyranny. Normal people like you and me are worked to the bone for scraps as rich fat cats at the top enrich themselves with the fruits of our labor. Then they put their money into cementing their power by rigging the system. 

That would be somewhat reasonable if there wasn’t an entire wing of American politics that demonizes corporations. It’s not tyranny if half of Congress is opposed to this alleged corporate scheme. However, Tamny digs a bit deeper than just that. If you look at the state of the workforce right now with NBA players collecting millions of dollars and workers at oppressive corporations like Facebook getting impressive new work complexes it seems like corporations are doing all the work. Corporations are bigger than ever and we are all collectively more wealthy and more comfortable than ever before. If anything, the bigger the corporation, the better the employees are treated. 

That isn’t to say that there aren’t plenty of cases of worker abuse and poor working conditions, but that’s also just how humans treat each other and all of history is dominated by poor working conditions. What has done more for worker welfare is not onerous labor regulations but increased competition and commercial success. When companies are forced to fight over workers, they treat them better. When companies make a profit, those gains are passed down to all members of the firm be it through pay raises, benefits, or fancy new amenities. 

Would you rather work in a startup in someone’s garage where your boss can only afford to pay you minimum wage and you all share a table, or would you rather work at Apple’s fancy new campus? Employment is a two-way street. Employees and corporations both have something they each want. In a free-market economy, such relationships are governed by a system of competing interests and facilitated by mutual benefit.

Tamny explains

“Benefits focused on retaining the best workers aren’t just a Silicon Valley or a Wall Street concept. People are essential and companies, far from exploiting them, are going out of their way to retain them.”

This is not to suggest that corporations are perfect or that those who are skeptical of corporate power are completely wrong. The main takeaway here as with every chapter in Tamny’s book is to look beyond the surface narrative you are being given. Perhaps you have found Tamny’s explanation about corporate power or immigrants unconvincing. That’s fine but rather than engaging with the fear-mongering narratives surrounding corporations and immigrants, do some independent research. Don’t be satisfied with the first thing out of your favorite politician who just wants your vote or that news anchor who wants to keep your eyes glued to the screen.

The bottom line: Do your own research, understand what you’re talking about, and engage honestly. Emotions and soaring rhetoric sound great on TV but that is not how you run a country. 

Key Takeaways

Tamny’s book is incredibly refreshing and intellectually stimulating, especially in polarized times like this. Although the common narratives Conservatives and Liberals like to use may be entertaining, perhaps even inspiring, they cannot be more harmful. Politics first and foremost is conflict. It’s about power and victory more than it is about the truth. In They’re Both Wrong, Tamny gives his thoughts on the problems associated with the various talking points that both sides like to offer. 

Although I am not saying that he is right about everything or that each chapter is to be treated as the final word on a matter, his book starts a conversation based on facts, not emotions. You may disagree with him but there is no denying that he cares about the consequences of his ideas and not just winning the argument. However, it must be said that after reading, I find it difficult to disagree with him. If anything, reading this book will give the reader a strong foundation in which to approach political issues. 

Such a book is essential not just because it provides insightful commentary on important political issues but because it provides a timeless lesson. This is that a country, a government, and a society cannot sustain itself on a foundation of weak narratives. Independent thought and rigorous conversations are what form the backbone of a vibrant democracy.

For weeks now, we’ve been been pointing to expectations that a Joe Biden victory, accompanied by a Democratic sweep of the Senate, could accelerate a “reflation” trade, as the world witnesses the shift toward fiscal policy in the form of massive fiscal stimulus supplant QE as the preferred vehicle for the central bank carrying out its monetary policy objectives.

This fusion between fiscal and monetary policy is an inevitable consequence of the Fed’s shouldering the burden of promoting economic “equality”, or at least combating “inequality” – a laughably ironic objective for the Fed, which has done more than any other single entity in blowing the equity asset bubble that’s driven economic inequality in the US back to levels last seen during the Gilded Age.

Well, after having MMT pioneer Stephanie Kelton, best known as the go-to economic policy advisor for AOC and Bernie Sanders, on the show, MacroVoices this week followed up with an individual who has examined the potential blowback caused by this historic policy shift.

This week, MV host Erik Townsend interviewed Tian Yang, the head of macro at Variant Perception, an established research shop that frequently produces opinion columns in the financial press. During this week’s interview, Yang outlines the findings from a slide deck that was provided free by MacroVoices to all members (membership is free)

After the historic drubbing endured by crude in the US earlier this year, Yang is among a group of strategists who have been warning about the reflationary blowback that the Fed is risking now that it has explicitly decided to allow inflation to run hot.

Yang outlines some of these concepts in the interview, which we have excerpted below:

* * *

Erik: And where do you see the inflation story coming into this?

Central Banks Must ‘Play Their Part’

Tian: So I think we need to think about inflation both from a structural point of view and a cyclical point of view. So the thing to say is cyclically, when unemployment rates are still quite high, when there’s still capacity in the economy, you don’t expect to see kind of immediate pickup in core inflation. Headline could tick up a little bit when commodity prices industrial commodity, so forth, initiate pickup, so on the cyclical front, there’s not necessarily as much inflation pressure right now.

But structurally, we’ve seen some truly seismic shifts in the kind of policy landscape and the structure of the economy actually just this year. When you see governments and developed market governments around the world start to run giant fiscal deficits funded by central banks, that’s obviously a very dramatic shift away from independent central banking and the focus on inflation.

This is very much going back to the old Keynesian kind of playbook of essentially, fiscal led growth and at the same time, we’ve seen the US Federal Reserve do a number of quite dramatic shifts this year. Firstly, moving to average inflation targeting is obviously quite a big mission that they don’t really know where the NAIRU (Non-accelerating inflation rate of unemployment) is, they don’t really care what the NAIRU is, they are just going to run the economy and let it run hot.

And such a policy is also pretty timing consistent because it’s not well defined, what’s the period over which we’re targeting average inflation. The incentive will always be as inflation picks up for policymakers to just run their heart because it’s easier to kind of keep the party going.

So, both fiscal and monetary policy are starting to become a lot more expansionary and loose. And the historical precedents for this kind of price action would probably go back to World War 2 with a fair-trade record, that essentially meant fiscal deficits would be very large. But there was a moral imperative for the central banks to finance the government deficits, and that ended up creating a lot of inflation.

And this time around, the moral imperative is that the central bank’s got to play their part with the pandemic. And going into the future, the central bank probably has to play their part was addressing inequality, climate change, or any of these big issues that essentially justifies why central banks should finance government deficits.

So that’s quite dramatic policy shift, the other thing that’s happened is that the Fed is now proactively kind of destroying the quality of its balance sheet. So again, as extreme, we could go back to when we were on the gold standard, if you look at central bank balance sheet, most currencies backed by gold, right.

So $1 is an asset for us but for the central bank $1 is a liability so previously they backed it on the asset side of their balance sheet with gold. Obviously, over time we abandoned the gold standard, so forth, the quality of assets on the central bank’s balance sheet is getting worse and worse. And obviously, this year, the fact that they started buying corporate bonds, the fact that, they’re willing to take on fallen angels, hide your debt and take on more credit risk is just another reflection of just the weakening central bank balance sheets.

It’s not necessarily a immediate concern, but it lays the foundations for people to kind of increase inflation expectations and to really worry about what the value of the dollar is. And so when you have these kind of structural shifts in policy coming together in a couple ways to make a kind of deterioration in central bank balance sheets and government balance sheets. That’s typically been the recipe for inflation expectations to become unhinged.

From A Lake To An Ocean

Erik: Tian, I love the picture on page five where you’re talking about lake and ocean regimes of inflation. Needless to say, you’re not talking about a necessarily a really calm easy day out on the ocean, but maybe a stormy day.

Now I want to go back to what you said because it seems to me that the game is very different this time around in that you drew an analogy to, okay, after World War 2 we move to a whole lot of deficit spending, which should be inflationary. The thing is, after World War 2 we were still, as you said, on a gold standard. And the big inflation didn’t really get unleashed until we came after the gold standard with the breakdown of Bretton Woods in 1971.

Now, this time around, we’re going to have I think the same if not a greater shift to a public policy emphasis on major spending programs with a lot of deficit spending. But we’re already in a pure fiat environment, so nobody’s pretending there’s a constraint on how much money you can print in order to finance government spending.

I would think that means that the inflation is certainly not delayed by 20 years the way it was after World War 2, but is it immediate? Or is there still a lag of several years before that inflation really hits the system in terms of consumer price inflation after those pre generated factors like deficit spending kick in? How long does it take before we really see the inflation start to get away?

Tian: Yeah, I mean, that’s a great question. I guess it’s a little bit like when they think about how people go bankrupt, right, it happens very slowly and or all at once. I think this is kind of the analogy we’re kind of drawing here because we’re talking about a shift in inflation expectations, which is obviously predicated on just the general belief in the system.

These things are obviously inherently fairly hard to predict but what we can do is kind of position for when it already makes sense. So when markets are already not pricing in much inflation risk premiums and also as the economy cyclically picks up, those things are going to help just drive a more normal reflation cycle.

So right now, if you position for that, then when the tail comes through and potentially more inflation picks up later, you’re kind of on the right side of it. In terms of the mechanism it could, as you say, potentially happen quickly or you could take a few years. I mean, if we’re in this kind of 1960 style environment then what you need to do is go along for the excess capacity in the economy to be used up first, and then have inflation pick up.

And then you will need that to feed into shifting hecs inflation expectations higher, and then you should move into more of a wage price spiral. Then when people think inflation is going higher, they’re going to demand higher wages and that’s what really kicks off the more uncontrolled inflation right now.

Arguably right now for a lot of people, you know say live in the United States, the actual cost of living inflation is actually already been a lot higher than what CPI would be saying if you look at shadow stats, inflation and these kind of different projections. They would say inflation has be running a 4-5% annually for the past 20 years, if you get rid of a lot of the hedonic adjustments and so forth. And arguably, it’s actually this mismatch between what official CPI says and what people feel is their true cost of living. That gap is also fueling a lot of the populism and the kind of general discontent that we have been seeing in society and, by the way, this isn’t a new, it’s just quite rare that we see it in developed markets.

If you take emerging market economies like Argentina or these places that have been known to have huge inflation’s, this is typically what happens. The population doesn’t believe in the CPI, they think their real cost of living is going up a lot higher, so when it comes to wage negotiations, they demand CPI plus 5-10%.

No more ’60/40′?

Erik: Tian, let’s talk about how this translates for portfolios, it sounds like we’re very much in agreement that inflation is coming, but it’s kind of hard to know exactly when and how it shows up. Probably when it does show up, it shows up in a big way, you don’t want to be caught by surprise, but you don’t know that it’s happening right away. So what do you do in terms of your portfolio in order to be ready for that?

Tian: Yeah, well that’s kind of the million-dollar question at the moment isn’t it? So the first thing to know is, I think I mentioned briefly at the start, clearly more traditional portfolio construction, the kind of 60/40 or the heavy allocation to fixed income, it’s naturally kind of getting to the end of the road. I think most people recognize that as yields bump up against the zero bound, the ability for your fixed income portion to really offer a diversified impact or a hedge to equity risk is going to diminish.

So, going forward, what’s very interesting about commodities is that one of the unique properties of commodities is typically when commodity volatility is high commodity prices actually tend to go up a lot. And this is quite different to equities because normally for equities only when equities are crashing that volatility picks up, whereas for commodities, the volatility tends to be to the upside. Now, the thing to say about commodities is that one of the big reasons why it tends to be very high volatility is that there tends to be quite prolonged periods of demand and supply mismatches for the industry. Just because typically supply responses can take a long time if you’re going to build a new mine, or drill a new well, or build a new plant, it could sometimes you could take up to three to five years. Obviously, if it’s like the super-efficient shell well, maybe it takes one year to get to get it going.

But for a lot of commodity sites if you’re going to build a refinery or build a chemical plant or things like that, it’s going to be three to five years. And because of that very delay supply response it is where you end up with this prolonged period of demand supply mismatches. And so that that’s kind of what we’re starting to see right now, where for a lot of commodity sectors are more capital scarce.

This being a prolonged period of a lack of investment, a lack of capex, and so these are sectors that we would expect to have quite explosive upside as the as the economy recovers and as demand comes back. So I think in the slide deck there’s a section on page 15 where I mentioned the capital cycle. So, I think this is a very interesting framework to actually think about when we’re trying to decide where to invest in.

So for the capital cycle I think that the best thing that I’ve read that’s really inspired us on this was some pieces written by Marathon Asset Management. And it was basically collated together in a book called “Capital Returns: Investing Through the Capital Cycle”, and the book was put together by Edward Chancellor. And so the basic idea is that, if there’s a lot of money flowing to a particular industry or sector, then that inflow of money will cause a lot more competition within that industry which drives down returns and then as returns fall very low then nobody in the industry can make a profit.

Listen to the rest of the interview below:

Submitted by Market Crumbs,

The music industry has been one of the hardest hit since the outbreak of Covid-19 earlier this year.

A survey of 2,000 independent concert venue owners across all 50 states in the U.S. conducted by the National Independent Venue Association found that 90% expect to close for good within a few months if federal funding isn’t provided.

“Independent venues were the first to close​ and will be the last to reopen​,” the NIVA said. “Venues have zero revenue, but obligations like mortgage/rent, bills, loans, taxes, and insurance continue. We have no work to offer our employees for the foreseeable future. The shutdown is indefinite and likely to extend into 2021 as our venues are in the last stage of reopening.”

With federal funding looking all but certain to not come in time to save these venues, Marc Geiger sees an opportunity to pitch his solution. Geiger, who formerly served as global head of the William Morris Endeavor Music Division from 2003 until 2020 and co-founded the music festival Lollapalooza, has formed what he calls SaveLive to essentially bail out struggling music venues.

SaveLive, which Geiger founded with former WME colleague John Fogelman, has landed $75 million in an initial investment round to invest in venues across the country by acquiring at least a 51% stake in each. SaveLive’s plan is to invest in dozens of clubs across the U.S. to create a network of venues that will be prepared for live entertainment to hopefully return in 2022 by their estimates.

“One of my favorite things in the world is to go to a club, be treated well and see an incredible band,” Geiger said. “So I thought, ‘OK, I’m going to raise a bunch of money and I’m going to backstop all these clubs. I’m going to be a bailout solution for them, and I’m going to call the company SaveLive.”

Despite having barely any other options, not everyone in the music industry is keen to SaveLive’s move to bailout struggling venues.

“Geiger’s solution on some level scares me,” Frank Riley of High Road Touring told the New York Times. “He is going to buy distressed properties for money on the dollar and end up owning 51 percent of their business. Is that independent? I don’t know. But it does save the platforms on which things grow and where artists are sustained.”

Geiger told the New York Times that SaveLive isn’t looking to flip venues but rather be a long term partner. SaveLive’s primary backer, Jordan Moelis of Deep Field Asset Management, echoed Geiger’s sentiment, saying “We don’t see this as a distressed-asset play. We see this as a business-building play, a play to be a long-term partner and to be around for a long time.”

With few other options available to struggling music venues across the U.S., SaveLive may be the best hope to save them from closing for good even if some in the industry aren’t completely on board.

Over the past decade we have closely watched the unprecedented divergence between growth and value stocks, which has made 13-year-old momentum-chasing Robinhooders millionaires, while bankrupting countless seasoned value investing titans.

However, as our friends at Kailash Concepts show, there is another historic divergence worth noting. The chart below shows the following:

• Light Blue Line: The Price to Sales ratio of the firms in the S&P500 with the fastest revenue growth
• Dark Blue Line: The Price to Sales ratio of the firms in the S&P500 with the slowest revenue growth

The fastest growers have almost never been more expensive and conversely the slowest growers have almost never been cheaper. Most importantly, the spread between the two has almost never been wider.

Those curious for more may find value, no pun intended, in Kailash’s May 2016 white paper, “The Revenue Wreck – Are We Paying Rational Prices for an Ex-Growth America?”

Authored by John E. McNellis, Principal at McNellis Partners, via WOLF STREET,

Landlords already know this: People are getting more toasted than Wonder Bread…

Happy Hour starts at 3 o’clock. Tenants selling reality-relief are killing it. I called a number of retailers to double-check my desultory anecdotal evidence. One, the owner of a first-rate supermarket chain, said his alcohol sales are up 25 percent since March. That came as no surprise, but the identity of his best-selling beer — Corona — did.

Along with half of America, I assumed that Corona was destined to become the Adolph of beer labels. Wrong. Drinkers love it — some think calling a hangover a “corona virus” is funny. This merchant said the only limitation on his Corona sales was lack of inventory. Neither he nor any other seller of liquor is asking for any rent breaks.

I called a major beer distributor in the Central Valley. Same story. Up 25 percent across the board. Any brand outselling the pack? “Honey, anything selling in a can or a bottle, our customers are buying it.”

Alcohol is easy to vet, sales are reported — no one’s cooking moonshine in their backyards. Marijuana? Let’s just say the numbers are a little cloudy. Without getting lost in the weeds, the big picture looks like this: Recreational marijuana (“rec”) consumption is up considerably this year, but precise numbers are hard to come by. Point of sale numbers for California’s legal rec were up 29 percent for the month of August.

These reported sales exclude of course the everyday low-cost alternatives of illegal and homegrown dope. How big is the illegal business? No one really knows, but a couple weeks ago California’s Attorney General Xavier Becerra touted the eradication of more than a million plants at 455 grow sites by the Department of Justice’s Campaign Against Marijuana Planting (CAMP) program. Unless CAMP is considerably more effective than most governmental programs, his numbers mean there’s enough illegal pot growing in the Golden State’s hills to blanket a lesser state. Or two.

As for the do-it-yourself crowd, you can grow a single plant on your kitchen window sill and, according to the net, harvest a couple hundred joints, enough to light up your neighborhood like a diesel generator. Grow the six plants you’re permitted under California law and you can buy yourself a tractor. No one has a clue how many pot transactions are free or bartered; maybe Netflix could make an educated guess by counting the number of times “Harold and Kumar go to White Castle” has been downloaded.

On the other hand, medical marijuana — the pain-killing lotions and potions — does lend itself to accurate accounting. It’s highly regulated, legal in 33 states and no one is selling it off the back of a truck. I asked the president of a leading medical marijuana company how the virus affected his business. Surprisingly, he said his sales were off 50 percent in early spring, during the depths of the shut-down, but slowly rebounded over the summer and are now surpassing their pre-Covid levels. He needed rent breaks in the spring.

I had assumed just the opposite: that with everyone in all kinds of pain, his sales would have soared. He replied, “Tinctures and topicals are expensive. When the shutdown hit and people were suddenly unemployed, there was a flight from med to rec, to quantity over quality.”

I think he meant that you can deal with back pain a couple different ways: rub an expensive lotion on your lumbar region or roll up a fattie. In addition to being cheaper, the latter approach has the benefit of making television comedy actually seem funny.

Reflecting on the Cannabiz in general, he said the price of “top flower” (on the street, buds) has risen from $1200 a pound wholesale in January to $1500 today, a result of its increased demand. He said the industry benefited by being earmarked essential from the get-go. (Guns and ammunition were also classified essential from day one; let’s hope the overlap between the two consumer groups is small.)

More than its essential classification, he believed the business was aided by the $600 federal stimulus payments to the unemployed. That figures. And, reflecting trends in the larger economy, he thought one clear Cannabiz winner is its home delivery sub-industry; it’s been growing exponentially at the expense of the bricks-and-mortar dispensaries.

As with alcohol, the real estate industry need not worry about its marijuana tenants. Let’s face it, selling highly addictive products has a distinct upside (just ask Starbucks).

The great toilet paper run may have made all the headlines, but it had nothing on pot. When the dopers belatedly realized their dispensaries were about to shut down in mid-March (“Whoa, dude, for sure? No? Whoa. That’s heavy”), they stormed the Bastille, their lines wrapping around the pot shops for blocks, buying everything green except the AstroTurf. A reasonable response to this the worst year anyone can recall.

*  *  *

Enjoy reading WOLF STREET and want to support it? Using ad blockers – I totally get why – but want to support the site? You can donate. I appreciate it immensely. 

Hunter Biden’s abandoned laptop contained a ‘treasure trove of top-secret material, including his father’s private emails and mobile phone numbers,’ and was protected by the password “Hunter02”, according to the Daily Mail.

The younger Biden’s MacBook Pro was full of ‘classic blackmail material’ between compromising sexual material and the private information of not only the Bidens, but also Bill and Hillary Clinton.

Hunter’s passport, driver’s license, social security and credit card numbers were also on the laptop, which revealed that he spent $21,000 on a ‘live cam’ porn website (while claiming he was too broke to pay his stripper baby-mama child support?).

Via the Mail:

The material, none of which was encrypted or protected by anything as basic as two-factor authentication, includes:

• Joe Biden’s personal mobile number and three private email addresses as well as the names of his Secret Service agents;
• Mobile numbers for former President Bill Clinton, his wife Hillary and almost every member of former President Barack Obama’s cabinet; 
• A contact database of 1,500 people including actress Gwyneth Paltrow, Coldplay singer Chris Martin, former Presidential candidate John Kerry and ex-FBI boss Louis Freeh; 
• Personal documents including Hunter’s passport, driver’s licence, social security card, credit cards and bank statements; 
• Details of Hunter’s drug and sex problems, including $21,000 spent on one ‘live cam’ porn website and ‘selfies’ of him engaging in sex acts and smoking crack cocaine; 

The article does not that while Hunter may have used his family name to boost deals with Chinese and Ukrainian firms, there is nothing implicating Joe Biden in any wrongdoing (just a massive like that he ‘never spoke with Hunter’ about his business dealings).

“‘It’s a data breach and dangerous to have this type of material floating around,” one former police commander told the Mail. “For someone prominent, there is not only a risk of great reputational damage but also a risk of blackmail should the material fall into the wrong hands.”

Hunter’s laptop was filled with 11 gigabytes of material covering the period from when his father was Vice President, to when Hunter dropped it off at a Mac Store in Wilmington, Delaware.

Read the rest of the report here.

PeakProsperity’s Adam Taggart writes that a legendary investor foresees hard times ahead…

Jim Rogers is not only one of the most successful investors of our era, he’s also an avid scholar of history.

Seeing that the world is buried under an unprecedented mountain of debt that is requiring more and more central planner intervention to keep from imploding on itself, Jim says history is clear on what happens next.

A clearing of the debt either via massive default, or destruction of the currency it’s denominated in.

He looks into the future and sees a terrible reckoning ahead; one he predicts will be “the worst economic crisis of my lifetime” — and Jim is 78 years old.

So where should investors look to preserve the purchasing power of their wealth against what’s coming?

Jim highly recommends precious metals and other commodities as an important part of the solution. As an overall index, commodities are the cheapest they’ve ever been vs the general stock market in over half a century:

Like many of the previous guest experts on our program, Jim maintains the near-term environment will be one of the most challenging times to invest in our lives.

“I caution all of you, it’s been 11 years since we’ve had a serious bear market… and I would suggest to you that maybe next time when we have a serious bear market it’s going to be the worst in my lifetime,” Rogers told an international forum hosted by Russia.

Additionally, as RT reports, while the coronavirus outbreak triggered the deepest crisis in decades, “overreacting” politicians have only exacerbated the situation, Rogers said.

“This is probably the worst [crisis] that I have seen in my lifetime, because everything collapsed and you had politicians and media and everybody overreacting in my view, and everybody closed down,” he told the 12th annual ‘Russia Calling’ Investment Forum in Moscow, when asked if he sees any parallels with previous financial crises.

“We’ve had many epidemics in history, but never before did they close McDonalds, never before did they close all the airlines,” Rogers noted, adding that this overreaction has ruined many economies and the lives of many people.

Which is why now, more than ever, is the time to partner with a financial advisor who understands the risks in play, can craft an appropriate portfolio strategy for you given your needs, and apply sound risk management protection where appropriate:

Anyone interested in scheduling a free consultation and portfolio review with Mike Preston and John Llodra and their team at New Harbor Financial can do so by clicking here.