GoFundMe campaigns established for Supreme Court nominee Brett Kavanaugh and his accuser, Christine Blasey Ford, have raked in over $1 million combined.
Ford, who lives in a $3.3 million Palo Alto home and has had free legal representation by attorneys has a combined GoFundMe “take” of more than $700,000 between two campaigns.
Kavanaugh, meanwhile, is likely to become the “poorest” Supreme Court justice with a mere $1.2 million home purchased in 2006 that has a mortgage of $865,000. His GoFundMe account, established by John Hawkins of Right Wing News, has reached over $500,000 of its $550,000 goal.
Last week Kavanaugh and Ford both testified in front of the Senate Judiciary Committee over allegations by Ford that the Supreme Court nominee held her down and groped her at a high school party in 1982. Ford’s account of the party is lacking in key details – however all of the individuals she named as having been in attendance have no memory of the event.
On Tuesday the FBI has confirmed those individuals’ accounts, after lame-duck GOP Senator Jeff Flake of Arizona sabotaged Kavanaugh’s confirmation by refusing to vote “yes” pending the results of an FBI investigation. Two other women who have accused Kavanaugh of sexual harassment have similarly uncorroborated or refuted accounts, while a fourth accuser has been referred to the Department of Justice by Judiciary Committee Chairman Chuck Grassley for issuing a false claim.
The Dow surged to a new record high today as Small Caps slump post-USMCA…
Another major divergence between big (Dow) and small (Russell 2000) stocks as the former soars relative to the latter and erases any relative performance YTD…
This is the biggest outperformance of Dow over Small Caps since Oct 2011.
Both are now up just over 8% on the year… (Trannies are worse. Nasdaq best)
Macro Risk Advisors technical analyst John Kolovos notes:
“Even though the S&P 500 is OK, the rest of the market is not. Very worrisome breaks in small and mid-cap stocks, as well as poor market internals with a growing percentage of stocks at one-month lows and internals trends at their weakest since April.”
While key price support levels are holding, a few more days of this kind of action will change the narrative to something more sinister.
Republican leaders are “a bunch of wimps,” said Jerry Falwell Jr.
Conservatives and Christians need to stop electing “nice guys.”
“The US needs street fighters like Donald Trump at every level of government because the liberal fascists Dems are playing for keeps.”
So tweeted the son and namesake of the founder of the Moral Majority, and he has here a self-evident point.
Thursday, 11 GOP senators on the judiciary committee freely forfeited to a female prosecutor their right to cross-examine Christine Blasey Ford, the accuser of Judge Brett Kavanaugh.
The Republicans feared that televised images of 11 white men, sharply questioning the credibility of Ford’s claim to be a victim of Kavanaugh’s sexual assault, would be politically lethal.
So, while the Republicans mutely abstained from challenging her, Ford was treated by the Democrats as the reincarnation of Joan of Arc, though not a single witness has corroborated her story.
Friday, Sen. Jeff Flake caved to Democratic demands for another weeklong FBI investigation of the judge. The Republicans, egg visible on their faces, endorsed their colleague’s capitulation.
Thursday, Sen. Lindsey Graham had been the Republican lion of the hearing, indicting Democrats for the moral atrocity they had deceitfully and dishonorably perpetrated against the judge.
By Friday, our Cicero was reaching out in collegiality to the same senators he was castigating 24 hours before.
Falwell’s point:Democrats fight savagely and for keeps, while Republicans — street-fighter Trump excepted — are wimps, often bewailing any loss of camaraderie with their colleagues across the aisle.
As my late friend Sam Francis said in the title of his book, many Republicans are perfectly content with being “Beautiful Losers.”
Yet the stakes here are immense. Consider how the Supreme Court has remade the America we grew up in.
Since World War II, the court has de-Christianized all public schools and the public life of a land Woodrow Wilson and Harry Truman called a “Christian nation.” It has established secularism as our state religion.
Despite civil right laws declaring race discrimination illegal, the court has given its blessing to affirmative action, deliberate discrimination in favor of peoples of color against white men in the name of diversity and equality.
The court has declared that what were once crimes, abortion and homosexuality, are now constitutional rights all Americans must respect.
These changes were not legislated democratically, but imposed dictatorially by the high court. While a Senate confirmation of Kavanaugh would not reverse these mandated changes, it might halt any further imposition of this radical social revolution by unelected judges.
But while the Democratic left, understanding the stakes, is fighting bare-fisted, Republicans are sparring with 14-ounce gloves and seeking to observe Marquess of Queensberry Rules.
In other ways as well America has been remade.
Not only has Christianity, and all its symbols and expressions of faith and belief, been removed, but also a purge is underway of monuments and statues of the explorers, colonists and statesmen who, believing in the superiority of their religion, culture and civilization, set out to create the county we inherited.
And William Frey, resident demographer at the Brookings Institution, writes about how America is being changed — without the consent of the people.
“Since 2000, the white population under the age of 18 has shrunk by seven million, and declines are projected among white 20-somethings and 30-somethings over the next two decades and beyond. This is … a trend that is not likely to change despite Mr. Trump’s wish for more immigrants from Norway.
“The likely source of future gains among the nation’s population of children, teenagers and young working adults is minorities — Hispanics, Asians, blacks and others.”
When we are all minorities, and all behave as minorities, making our separate demands upon the country, what then holds America together?
In Federalist 2, John Jay famously wrote:
“Providence has been pleased to give this one connected country to one united people — a people descended from the same ancestors, speaking the same language, professing the same religion … very similar in their manners and customs…
“This country and this people seem to have been made for each other, and it appears as if it was the design of Providence, that an inheritance so proper and convenient for a band of brethren, united to each other by the strongest ties, should never be split into a number of unsocial, jealous, and alien sovereignties.”
Yet, each decade, less and less are we descended from the same ancestors. Less and less do we speak the same language, profess the same religion, share the same manners, customs, traditions, history, heroes and holidays.
Does America look today like the “band of brethren united to each other” of which Jay wrote, and we seemed to be as late as 1960?
Or does not the acrimony attendant to the nomination of Judge Kavanaugh suggest that we have already become a land “split into a number of unsocial, jealous and alien sovereignties.”
With all our new diversity, whatever became of our unity?
Earlier today, we laid out the three main reasons why, according to to Goldman, the Italian bond turmoil was set to get worse: in brief, these were rising government debt (as a result of the sharply higher projected budget deficit of 2.4% through 2021), fading ECB support (QE ending at the end of 2018), and diminished market liquidity (wider bid-ask spreads and declining volumes).
Well after today’s initial selloff, when euroskeptic Claudio Borghi and president of the Lower House’s budget committee commented that the country would have solved its fiscal problems if it had its own currency while Deputy PM Luigi Di Maio said he’s not concerned about spread widening, it did not take long for the market to digest Goldman’s warning and to resume the selling in Italian government bonds, with the 10Y plunging for the second time today, and pushing the yield to 3.448%, the highest since 2014…
… while “lo spread” between Italian and German 10Y paper has blown out beyond 300 bps, the widest going back to 2013.
Curiously, unlike during today’s first selloff, the late day liquidation has not been accompanied by a drop in the Euro, which however may be explained by the sharp drop in the dollar index which has slumped back to session lows.
For now the Italian bond turmoil remains relegated within its borders, but the question on every trader’s mind is “for how much longer.”
Outgoing Arizona Senator Jeff Flake has insisted that his last-minute decision to demand that the FBI reopen its background check investigation into Trump SCOTUS nominee Brett Kavanaugh wasn’t inspired by a pair of young women who accosted him in the halls of the US Capitol and loudly berated him with tear-jerking stories of sexual abuse.
But the timing of Flake’s change of heart is certainly curious, and the liberal press has widely heralded the two young women has “heros” for helping to force a delay of Kavanaugh’s confirmation by at least another week.
But one thing the progressive press hasn’t reported is that the two young women weren’t merely concerned citizens speaking truth to power. The reality is that Ana Maria Archila and Maria Gallagher are both professional political activists employed by the Center for Popular Democracy.
And guess who finances the CPD?
That’s right…
According to a report in the New York Post,the CPD is financed primarily by George Soros’ Open Society foundation, the massive non-profit that supports groups fighting on behalf of the billionaire investors’ political agenda across Europe and the US. That dramatic confrontation in front of a Senators-only elevators was a political stunt organized by a Soros-funded organization. This means that Soros has played as large a role as anybody in helping delay a confirmation vote on Kavanaugh.
Make no mistake. The Center for Popular Democracy is at the heart of the effort to stop Kavanaugh. A source forwarded to me an email sent from the organization: “Last week, you saw protestors interrupting the Kavanaugh hearings, trying to slow it down and show the Judiciary Committee how much they/we care. Those protests were organized by the Women’s March and the Center for Popular Democracy and other groups.”
Archila has another role beyond her duties as co–executive director of the center. She is also a member of the national committee of the New York-based Working Families Party. The WFP was founded in 1998 by the leaders of ACORN, the now-disbanded and disgraced group of community organizers.
In 2009, ACORN finally ran off the rails. Guerrilla videographer James O’Keefe secretly recorded employees in its offices in Brooklyn, Baltimore, Washington and San Bernardino, Calif. O’Keefe and a colleague posed as a prostitute and a pimp and said they were planning to import underage women from El Salvador for the sex trade. They asked for and received advice on getting a housing loan and evading federal taxes.
The impact that this confrontation had on Flake was readily apparent…
…Media reported an instant change in his demeanor, with his “eyes wet” and his chin tucked into his chest.
Additionally, one of the women has ties to the Working Families Party, and organization financed by alumni of ACORN, the group of community organizers that shut down in 2009 after conservative journalist James O’Keefe exposed some of its “organizers” engaging in nefarious behavior on behalf of the organization.
Furthermore, just imagine if two women cornered Dianne Feinstein in an elevator and demanded that she investigate how Christine Blasey Ford’s letter describing her alleged assault leaked to the press?
But imagine if two women had cornered a Democratic senator in an elevator and demanded an investigation of who had leaked to the media Christine Blasey Ford’s letter alleging that Kavanaugh had sexually assaulted her. (Sen. Lindsey Graham said Sunday that he planned to investigate the leak.) There would have been sputtering outrage in media circles, and reporters would have breathlessly hunted down any ties between the women and outside groups.
If there is a takeaway here, it’s that the US media is far too lenient on these “activists”, often neglecting to perform even a simple background check to determine if they have any affiliations that might be cause for bias.
But given the current climate, we don’t expect this to change any time soon.
They say nobody rings a bell at the top of the market. But whether this is the top or not, two prominent market observers and historians, Robert Shiller and Edward Chancellor, are expressing concern.
First, Shiller warns readers not to take big increases in earnings too seriously because earnings are volatile.
Everyone knows that stock prices have risen dramatically since 2009. A $100 investment in the S&P 500 in 2009 has grown to nearly $400 at the end of August 2018. But Shiller reminds us that earnings have grown dramatically too. In fact, “real quarterly S&P 500 reported earnings per share rose 3.8-fold over essentially the same period, from the first quarter of 2009 to the second quarter of 2018,” according to Shiller. Prices, in fact grew a bit more slowly than earnings since the end of the crisis.
So should we think stocks are reasonably priced since earnings have grown at the same pace as prices? Not so fast, Shiller says. Earnings, the difference between two other data sets — revenues and expenses, are volatile, and cyclical. Rapid rises in earning are often followed by a return to long term trends or subpar levels. Such episodes have occurred more than a dozen times in U.S. stock market history.
Earnings can grow dramatically from things like “panicky demand” for U.S. goods from Europeans at the beginning of World War I. This led to political calls for “wealth conscription” or a heavy taxation on war-related profits. At that time stock prices didn’t follow profit advances as investors seemed to realize those gains would be short-lived.
In the “Roaring ‘20s,” however, emergence from a “war to end all wars” and a spirit of freedom and individual fulfillment spurred stock prices by Shiller’s lights. And this, of course, led to a crash at the end of the decade.
Another period where price gains outstripped earnings gains was 1982-2000. Real stock prices increased 7.5-fold, while real annual earnings only doubled, according to Shiller. Indeed the S&P 500 Index delivered an eye-watering 17% compounded annual return from 1982 through 2000, mostly on the back of multiple expansion (the increased price investors are willing to pay for underlying earnings).
In the next period, from 2003 through 2007, real corporate earnings per share almost tripled, but the real S&P 500 didn’t manage a double, because, as Shiller puts it, “investors apparently were unwilling to repeat their mistake in the years leading to 2000, when they overreacted to rapid earnings growth.”
After the 2008 financial crisis, which decimated earnings and prices, both have increased dramatically in tandem. Shiller can’t easily analyze investor psychology to know why, but he thinks it must be rooted in the “public’s loss of healthy skepticism about corporate earnings, together with an absence of popular narratives that tie the increase in earnings to transient factors.” In other words, nobody think earnings will go down dramatically or that their recent increase might be tied to something that can’t last.
Shiller doesn’t know if this is a bubble. He asks the question initially, but doesn’t answer it completely. I suspect that’s because Shiller thinks bubbles rest more on narratives and human psychology than on things like interest rates, and he can’t find a compelling narrative currently.
But Edward Chancellor thinks record low interest rates since the financial crisis have produced bubbles galore and zombies, meaning overpriced assets and unproductive companies sustained only by low rates.
Chancellor, concentrating less on psychology in his recent article, reminds us of Adam Smith’s remark that “the ordinary price of land… depends everywhere upon the ordinary market rate of interest.” That’s because one discounts future income by the interest rate to arrive at the present value of an asset. The lower the rate, the higher the present value, and vice versa. Unfortunately, central bankers refused to accept this Smithian calculation after the collapse of Lehman Brothers. And so, they have kept rates so low for so long that they have created bubbles in industrial commodities, rate earths, U.S. farmland, Chinese garlic bulbs, fine or not-so-fine art, vintage cars, fancy handbags, super-city properties from London to Hong Kong, long-dated government bonds, listed and unlisted technology stocks, and the broader American stock market. Finally, Chancellor wonders whether low rates have encouraged a cryptocurrency bubble.
U.S. stocks are very expensive on dependable valuation measure such as total market value relative to GDP and on replacement cost basis (Tobin’s Q) compared to historic levels. American companies have also been on a borrowing binge. The problem is the economic rebound has been lackluster, and Chancellor blames easy credit and zombie corporates for this. Usually, a severe recession washes out weak companies, and investors reallocate capital to productive enterprises. “Business failures are essential to the recovery.”
Low interest rates have allowed companies that would have otherwise gone out of business to stay alive, and this has caused a tepid recovery. Chancellor notes the cumulative default rate on junk bonds during the entire recession was 17%, or “around half the level of the two previous downturns.” And while central bankers might view this as a victory, he views it as the cause of economic weakness.
The lessons for investors are to remain vigilant about stock valuations and higher yielding bonds. At some point the zombies will not be able to sustain themselves any longer. And that’s when having a good financial plan and asset allocation will help.
The FBI has refused to declassify 37 pages of materials related to the Uranium One deal, citing national security and the privacy issues, reports The Hill‘s John Solomon. The documents are thought to contain information regarding then-Secretary of State Hillary Clinton’s involvement, as well as the Obama administration’s knowledge of the controversial deal.
The existence of the documents became known after a recent Freedom of Information Act (FOIA) release of related material contained an entry entitled “Uranium One Transaction.” The publicly available portion includes benign material, such as public letters from members of Congress who demanded information on the Uranium One approval.
Perhaps the FBI’s unexpected “release” — and I use that word loosely, since they gave up no public information of importance — in the FOIA vault was a warning flare designed to remind America there might be evidence worth looking at.
One former U.S. official, who had access to the evidence shared with CFIUS during the Uranium One deal, said this to me: “There is definitely material that would be illuminating to the issues that have been raised. Somebody should fight to make it public.”
That somebody could be President Trump, who could add these 37 pages of now-secret documents to his declassification order he is considering in the Russia case. –The Hill
William Campbell and the FBI
In October of 2017, John Solomon and Alison Spann broke the story of former CIA and FBI undercover agent, William D Campbell – who remained unnamed until this year. Campbell was deeply embedded in the Russian nuclear industry while Robert Mueller was the Director of the FBI – which paid him a $51,000 “thank you” award for his service.
“For several years my relationship with the CIA consisted of being debriefed after foreign travel,” Campbell noted in his testimony, which was obtained by this reporter. “Gradually, the relationship evolved into the CIA tasking me to travel to specific countries to obtain specific information. In the 1990’s I developed a working relationship with Kazakhstan and Russia in their nuclear energy industries. When I told the CIA of this development, I was turned over to FBI counterintelligence agents.” –saracarter.com
While undercover, Campbell was forced by the Russians (with the FBI’s blessing) to launder large sums of money – which allowed the FBI to uncover a massive Russian “nuclear money laundering apparatus.” Campbell claims to have collected over 5,000 documents along with video evidence of money being stuffed into suitcases, Russians bragging about bribing the West, and millions of dollars routed to the Clinton foundation.
The evidence was compiled as Secretary Clinton courted Russia for better relations, as her husband former President Clinton collected a $500,000 speech payday in Moscow, and as the Obama administration approved the sale of a U.S. mining company, Uranium One, to Rosatom. –The Hill
Campbell initially discovered that Moscow had compromised an Maryland-based uranium trucking firm, Transport Logistics International (TLI) in violation of the Foreign Corrupt Practices Act – which bribed a Russian nuclear official in exchange for a contract transport Russian-mined U.S. uranium, including “yellowcake” uranium secured in the Uranium One deal.
Yellowcake uranium
He delivered bribes from TLI in $50,000 increments to Russian nuclear official Vadim Mikerin of Tenex. Under orders from the FBI in order to maintain his cover, Campbell fronted hundreds of thousands of dollars he says he was never reimbursed for. As a result of Campbell’s work, TLI co-president Mark Lambert was charged in an 11-count indictment in connection with the scheme, while Vadim Mikerin, who resides in Maryland, was prosecuted in 2015 and handed a four-year sentence.
Second, Campbell says that Russian nuclear officials revealed a scheme to route millions of dollars to the Clinton Global Initiative (CGI) through lobbying firm ARPCO, which was expected to funnel a portion of its annual $3 million lobbying fee to the charity.
“The contract called for four payments of $750,000 over twelve months. APCO was expected to give assistance free of charge to the Clinton Global Initiative as part of their effort to create a favorable environment to ensure the Obama administration made affirmative decisions on everything from Uranium One to the U.S.-Russia Civilian Nuclear Cooperation agreement.“ –William Campbell
Campbell told Congressional investigators that the Uranium One deal along with billions in other uranium contracts inside the United States during the Obama administration was part of a “Russian uranium dominance strategy” involving Tenex and its American arm Tenem – both subsidiaries of state-owned Russian energy company Rosatom.
“The emails and documents I intercepted during 2010 made clear that Rosatom’s purchase of Uranium One – for both its Kazakh and American assets – was part of Russia’s geopolitical strategy to gain leverage in global energy markets,” he testified. “I obtained documentary proof that Tenex was helping Rosatom win CFIUS approval, including an October 6, 2010 email … asking me specifically to help overcome opposition to the Uranium One deal.”
“Rosatom/Tenex threw a party to celebrate, which was widely attended by American nuclear industry officials. At the request of the FBI, I attended and recorded video footage of Tenam’s new offices,” he added.
Officials with APCO – the lobbying firm accused of funneling the money to the Clinton Global Initiative, told The Hill that its support for CGI and its work for Russia were not connected in any way, and involved different divisions of the firm.
What did Obama know?
As Solomon notes, a giant question remains that may be solved by the release of the 37-pages of classified information; what did the Obama administration know about this?
Did the FBI notify then-President Obama, Hillary Clinton and other leaders on the CFIUS board about Rosatom’s dark deeds before the Uranium One sale was approved, or did the bureau drop the ball and fail to alert policymakers?
Neither outcome is particularly comforting. Either the United States, eyes wide open, approved giving uranium assets to a corrupt Russia, or the FBI failed to give the evidence of criminality to the policymakers before such a momentous decision. –The Hill
Campbell says that his FBI handlers assured him that Obama had been briefed by then-FBI Diretor Mueller on Rosatom’s criminal activities as part of the president’s daily briefing, however “politics” was the reason that the sale was approved anyway.
Smearing Campbell
After Solomon broke the Campbell story, Democrats viciously attacked Campbell, a cancer-stricken man showered by praise by the Obama administration at a 2016 celebration dinner in Crystal City, VA. Since his undercover work in Russia, Campbell has undergone 35 intensive radiation treatments after being diagnosed with brain cancer and leukemia.
Michael Isikoff
Michael Isikoffof Yahoo News wrote an article slamming Campbell – saying he would be a “disaster” as a witness because some of his claims could not be documented, an anonymous source told Isikoff (Isikoff’s Yahoo News article was used by the FBI to support the FISA spy warrant on Trump aide Carter Page, after Isikoff was fed information by Christopher Steele).
Meanwhile, in a move which can only be interpreted as an effort to protect the FBI, the Obama administration and the Clintons, AG Jeff Sessions and Deputy AG Rod Rosenstein even tried to suggest the nuclear bribery case uncovered by Campbell is not connected to the Uranium One deal.
Via John Solomon last November:
“Attorney General Jeff Sessions in testimony last week and Deputy Attorney General Rod Rosenstein in a letter to the Senate last month tried to suggest there was no connection between Uranium One and the nuclear bribery case. Their argument was that the criminal charges weren’t filed until 2014, while the Committee of Foreign Investment in the United States (CFIUS) approval of the Uranium One sale occurred in October 2010.” –The Hill
This rubbed several Congressional GOP the wrong way:
“Attorney General Sessions seemed to say that the bribery, racketeering and money laundering offenses involving Tenex’s Vadim Mikerin occurred after the approval of the Uranium One deal by the Obama administration. But we know that the FBI’s confidential informant was actively compiling incriminating evidence as far back as 2009,” Rep. Ron DeSantis, (R-Fla.) told The Hill, adding “It is hard to fathom how such a transaction could have been approved without the existence of the underlying corruption being disclosed”
Senate Judiciary Committee Chairman Chuck Grassley (R-IA) sent a similar rebuke to Rosenstein, saying the deputy attorney general’s first response to the committee “largely missed the point” of the congressional investigations.
Between the DOJ stonewalling Campbell and the MSM smear job he was subjected to after he went public, perhaps it’s more important than ever that those 37 pages see the light of day.
As the push towards 5G-powered ‘Smart’ surveillance cities begins across the United States the Federal Communications Commission has approved a new rule limiting the power of local authorities.
On Monday October 1st, Sacramento, Houston, Indianapolis and Los Angeles became the first cities to gain access to Verizon’s 5G Wireless service. The City of Sacramento has become a focus of Verizon’s nationwide expansion of 5G, or 5th Generation Cellular technology. “We were able to make Sacramento one of our first 5G cities because Mayor Darrell Steinberg and city leaders embraced innovation and developed a strategic vision for how 5G could be a platform for the larger Sacramento technology ecosystem,” said Jonathan LeCompte, Pacific Market president for Verizon.
The rollout of 5G is expected to herald the beginning of Smart Cities, where driverless cars, pollution sensors, cell phones, traffic lights, and thousands of other devices interact in what is known as “The Internet of Things”. The move towards the smart grid was hastened last week when the Federal Communications Commission (FCC) approved a rule that will limit the role of local authorities regarding the build of 5G networks, specifically the amount city officials can charge telecommunication companies (“Big Tech”).
“All four commissioners offered support for the rule, with Democrat Jessica Rosenworcel dissenting over only part of the proposal. When the new rules take effect, local officials will have 60 to 90 days to review installation requests.
Republicans on the commission say that limiting what they see as exorbitant fees in major cities will free up capital for companies like Verizon and AT&T to invest in building out their networks in underserved rural areas. The commission estimated that the rule will save wireless providers $2 billion.”
However, there are those who are resisting the race towards the “smart” future. The mayors of Los Angeles and Philadelphia opposed the rule and accused the FCC of overriding local authority to regulate the new technology. Los Angeles Mayor Eric Garcetti sent a letter to the FCC stating that the rules would override previous agreements established by local authorities and Verizon and AT&T. In addition, before the vote a group of House Democrats wrote to FCC Chairman Ajit Pai asking him to cancel the vote.
“This is extraordinary federal overreach,” Rosenworcel said of the rule. “I do not believe the law permits Washington to run roughshod over state and local authority like this and I worry the litigation that follows will only slow our 5G future.” The Hill also notes that critics argue that the rush to a 5G future is leading to an increased “digital divide” between those who have faster internet abilities and those who do not.
Sascha Meinrath, the Palmer Chair in Telecommunications for Pennsylvania State University, believes the rule will contribute to decreased competition. “What’s preventing deployment is not permitting fees from local governments, its anti-competitive behavior from the incumbents,” he told InsideSources in an interview. “If you study telecom history, this is a cycle that happens again and again and again.”
Is 5G safe?
Other concerns of the 5G expansion include potential health risks due to the need for an increase in cellular equipment. 5G technology is reported to be 100 times faster than current speeds but the signal is short so cities must install thousands of new “small cells” on current infrastructure, as well as new equipment. Critics worry about the health impact of these cells. GovTech reports:
“Additionally, the proliferation of small cells has prompted worries over potential health risks, particularly given how close some pole-mounted antennas are to homes. The FCC last updated its radiation exposure guidelines more than two decades ago, based mostly on existing cellphone towers. Citizens in several communities have protested installations, and the agency is in the process of updating its standards.”
The Verge also reported that the “FCC excludes these small cell cites from being reviewed for environmental impacts and impacts on the historical character of an area. It also limits review on tribal lands.” Health concerns regarding the dangers of cell phones and 5G have been prompted by a May 2011 assessment in which the World Health Organization’s International Agency for Research on Cancer (IARC) classified cell phones as Category 2B for “possibly carcinogenic to humans“. In addition, in August 2016, the LA Times asked, “Is 5G technology dangerous? Early data shows a slight increase of tumors in male rats exposed to cellphone radiation”.
That report shows that National Toxicology Program researchers released preliminary data in May 2016 which showed small increases in tumors in male rats exposed to cellphone radiation. The rats were exposed to nine hours of radiation daily, in 10-minutes-on, 10-minutes-off intervals, over their whole bodies for two years. The researchers found increased incidences of rare brain and heart tumors starting at about the federally allowable level of cellphone radiation for brain exposure, with greater incidences at about two and four times those levels.
Privacy, a Thing of the Past
The coming Smart Grid also threatens to wipe away the last vestiges of privacy – all in the name of convenience, novelty, and (allegedly) safety. However, the dangers are largely being ignored in favor of touting the perceived benefits. The ACLU described the surveillance dangers of 5G technology:
“Many of these technologies involve cameras that can be tasked with jobs that range from keeping track of traffic to monitoring when the corner trash can gets full. The problems start when they’re also used for tracking people and their movements. In a city blanketed with cameras — including in LED light bulbs found in streetlights — it would be very easy for the government to track which political meetings, religious institutions, doctors offices, and other sensitive locations people go to and to focus its attention even more on traditionally over-policed communities. This is why these “Smart Cities” are also referred to as “Surveillance Cities.”
The FCC and city officials must conduct further studies on the potential health effects related to the roll out of 5G. Also, the people of these cities must have a chance to comment on the health and privacy implications. Unfortunately, it seems most people are either totally in the dark about this situation or welcoming 5G because of the prospect of “living in the future now.”
As the return of turmoil to the Italian market has demonstrated, the decision by the current Italian government to target a deficit of 2.4% of GDP in each year through 2021 constitutes a meaningful deviation from the commitments made by the previous government to the European Commission of a projected deficit of 0.8% in 2019. The news sent BTP spreads back to the top end of their range since May, with today’s 10-year yield reaching a local high of 3.4%, surpassing the May highs.
And while some commentators see the localized turbulence in Italian markets as exaggerated – especially due to the lack of any 2nd order contagion effects – in a note this morning, Goldman’s Matteo Crimella lists three reasons to expect high volatility to persist for the time being:
First, the planned fiscal expansion, while not extreme,is sizable enough to renew investor concerns about the long-term sustainability of Italy’s public debt stock, in large part owing to the expected deterioration in the country’s primary surplus. A lower primary surplus increases the vulnerability of the economy to growth and market shocks, and worsens the outlook for the public finances, especially when the stock of public debt is already elevated and growth is unlikely to benefit much from fiscal easing owing to a low fiscal multiplier. The parliamentary budget office reports that, cumulatively over the past eight years, the government primary surplus has reduced Italy’s debt-to-GDP ratio by approximately 11.5 percentage points. Positive growth and lower interest expenditures (compared with 2011-2013) have also supported the stabilization of the Italian debt level over the past few years (Exhibit 1). With a lower expected primarily surplus, higher funding costs and soft economic activity, considerations of long-term debt sustainability pose a challenge to forward debt/GDP dynamics, and have meant investors have required a higher risk premium on Italian government bonds.
Second, the increase in government funding needs stemming from a higher public deficit comes in conjunction with the slowdown and forthcoming end of the ECB’s net asset purchases. The’s ECB quantitative easing program initiated by the ECB in March 2015 is coming to an end this year. Since its initiation, the central bank has purchased €360bn-worth of Italian government bonds and we expect it to buy another €5.5bn in the last quarter of this year. From January 2019 onwards, Goldman expects new purchases to end and reinvestments of the Italian government bond portfolio to average EUR3-3.5bn/month in 2019 (Exhibit 2).
Over the past few years, ECB buying of medium-/long-term debt has allowed the Italian Treasury to increase the average life of government debt by approximately 0.5 years and to bring it back to levels seen before the global financial crisis. Despite an increased reliance on term debt, the Italian Treasury has to roll over approximately EUR400bn in securities per year (including short-term securities). With ECB demand diminishing, the increase in supply to the private sector will likely represent an additional headwind to BTPs.
Third, heightened market volatility in recent months may have had lasting effects on BTP liquidity and market depth. In Exhibit 4, Goldman shows the average daily volumes of Italian government securities on cash secondary markets (M.T.S.) during April, May and June 2018. The volumes of BTPs exchanged in June, following the selloff of Italian bonds initiated at the end of May, have been almost one-third of those observed in April and May.
While these data refer to a few months ago, the collapse in volumes, accompanied by a meaningful increase in bid/ask spreads (Exhibit 5), point to a potentially severe deterioration of market liquidity, which in Goldman’s view has resulted in increasingly gappy price action.
In light of these three factors: rising government debt, fading ECB support, and diminished market liquidity, in the short term Goldman expects the volatility of Italian government bonds to remain elevated:
While the broader market seems to have partly moved on from Italy’s risk and international financial spillovers have been relatively muted thus far, we believe the current situation is an unstable equilibrium. After all, the new budget proposal will likely increase the odds of negative reactions from Brussels and rating agencies, and consequently the risk of additional volatility and curve flattening pressures.
Finally, while conceding that both the near- and medium-term outlook for BTPs remains highly uncertain, Goldman’s best guess for what happens in the near future is that spreads will trade closer to the high end of their range since May for the time being. Specifically, “a move through 300bp in spreads is possible and, if sustained, would likely require a policy change at the national or European level.” Who knows, it may even prompt the ECB to delay the December 31, 2018 end date of its QE program…
It would seem the Democrats had better quickly switch the Kavanaugh narrative back to him being an immature teenage drinker quickly as The Washington Post reports that, according to sources, three witnesses whom Christine Blasey Ford alleges were at the party in her testimony have told The FBI that they do not recall the gathering.
The FBI has talked to alleged party guests Patrick J. Smyth, Mark Judge and Leland Keyser:
“[Smyth] truthfully answered every question the FBI asked him and, consistent with the information he previously provided to the Senate Judiciary Committee, he indicated that he has no knowledge of the small party or gathering described by Dr. Christine Blasey Ford, nor does he have any knowledge of the allegations of improper conduct she has leveled against Brett Kavanaugh,” Smyth’s lawyer Eric B. Bruce said in a statement, according to WaPo.
Having denied the Ford and Swetnick allegations in a formal statement, Judge’s lawyer Barbara Van Gelder said in a statement Monday, according to CNN:
“Mr. Judge has been interviewed by the FBI but his interview has not been completed,”
“We request your patience as the FBI completes its investigation.”
Keyser does not remember the gathering in question but has said she believes Ford.
“Ms. Keyser does not refute Dr. Ford’s account, and she has already told the press that she believes Dr. Ford’s account,” Keyser’s attorney, Howard Walsh, wrote in a Friday statement, according to CNN.
“However, the simple and unchangeable truth is that she is unable to corroborate it because she has no recollection of the incident in question.”
Ford had yet to be interviewed b The FBI as of Monday evening, but there are plenty more interviews to come as Senate Judiciary Committee Democrats signed a letter Monday with a list of 24 additional witnesses they want interviewed by the FBI.
Tick tock… Of course, the chance they are going to stop the delay tactics now is zero. Remember Merrick!
