Category: zerohedge

Authored by Tyler O’Neil via PJMedia.com,

In the days after the Capitol riot on January 6, 2021, Big Tech moved against a conservative alternative social media platform, Parler, based on the premise that the rioters has used Parler to plan the attack on the Capitol and that Parler had failed in its responsibility to prevent such coordination. Based on this narrative, Apple and Google removed Parler from their app stores and Amazon removed Parler’s internet hosting. Yet on Thursday, Parler flipped the narrative on its head.

On Thursday, Parler sent a response to the House Committee on Oversight and Reform’s request for documents regarding the riot, the company explained in a press release. In that response, Parler revealed that it had “proactively developed an open line of communication with the Federal Bureau of Investigation (FBI) in the fall of 2020 and referred violent content and incitement from Parler’s platform over 50 times before January 6th. Parler also warned the FBI about specific threats of violence being planned for the events at the Capitol on January 6th.”

In its letter, Parler said that the company recognizes “legal limits to free speech” and that its policies “have always prohibited threats of violence and incitement on its platform.”

The letter details Parler’s efforts “to flag and remove unlawful speech from its platform that was not protected by the First Amendment.” It also notes that of the 270 charging documents filed by the Department of Justice, 80 percent of social media references involved Big Tech platforms like Facebook, Twitter, and Instagram. “Only 5% referred to Parler.”

The letter goes on to explain that Parler accumulated over 15 million users by January 2021 and its app was the most downloaded app at the Apple App Store and the Google U.S. Play Store on January 8, 2021.

The company’s press release connected the dots.

“Big Tech rivals Facebook and Twitter saw Parler as a viable threat and ganged up with Amazon and others to de-platform and destroy the Company. Big Tech has been effectively scapegoating Parler for the riots at the Capitol, but Parler’s revelations today show that the Company acted responsibly to try and stop the violence at the Capitol on January 6th,” the press release concluded.

Along with the letter and the press release, Parler provided the emails alerting the FBI to incitements to violence on Parler’s social media platform. The company repeatedly warned its FBI contact about the potential for violence on January 6.

In one email, Parler forwarded a message from a user who called for “an armed force of American Patriots 150,000… prepared to react to the congressional events of January 6th … And follow what the Declaration of Independence has dictated to do in situations of absolute despotism.”

“One more from same account. More where this came from. Concerned about Wednesday,” a Parler employee wrote to the FBI contact on January 2, the Saturday before the events of Wednesday, January 6.

Contrary to the Big Tech narrative, Parler did its due diligence and reported threats of violence to the FBI in advance of the Capitol riot. These actions, coupled with the fact that Parler only appeared in 5 percent of the DOJ’s charging documents, completely flips the Big Tech narrative on its head. The Capitol rioters did coordinate on Parler, in part, but they also did so on other social media platforms.

Parler was not negligent in its duty to remove incitements to violence, as Amazon, Apple, and Google claimed. In fact, it removed those incitements and altered the FBI about them. Parler may not have been perfect in this regard, but the company had been proactive before the Capitol riot.

“There is no truth to the absurd conspiracy theories that have been put forth by Big Tech and its media allies to unfairly malign the company and which were referenced in the Committee’s Letter,” Parler said, according to the letter.

“Contrary to what has been reported, and as explained in more detail below: the company is and always has been American-owned and controlled; Parler has never engaged in any collusion with ‘the Russians’; and Parler never offered President Donald J. Trump an ownership interest in the company.”

Internet Accountability Project (IAP) President Mike Davis summed up the situation well.

“When Twitter targets conservatives – including President Trump – Big Tech shills tell us to ‘build our own Twitter.’ So Parler did. Then trillion-dollar monopolists Google and Apple – running their duopoly/cartel – kicked Parler out of the app stores. Then trillion-dollar monopolist Amazon kicked Parler off the internet,” Davis recounted.

“The stated reason for Google, Amazon, and Apple’s anticompetitive conspiracy was that Parler promoted the violence at the January 6th protests at the Capitol. But we’ve learned today that was a bogus, pretextual excuse by three trillion-dollar Big Tech monopolists (Google, Apple, and Amazon) to kill a competitor of Twitter (another Big Tech monopolist),” Davis declared. “Indeed, we now know that in the days and weeks leading up to January 6th, Parler made over 50 referrals of violent content to the FBI, including specific threats of violence being planned at the Capitol.”

“Now we know the truth, which is Big Tech used Parler as a scapegoat to destroy a startup company that was a viable threat to their social media dominance,” the IAP president concluded.

While Parler withdrew its original January federal lawsuit against Amazon, it filed a new lawsuit in Washington State court, alleging defamation and breach of contract.

Former President Donald Trump has announced he will launch his own social media platform, which will apparently compete with Twitter and Facebook, as well as conservative alternatives like Gab and Parler.

After the extreme surge in income and spending in January (as government handouts gushed across the nation), analysts expected February to see some give back (more on the income side than on the spending side) – they were right.

Americans’ income fell 7.1% MoM in February (-7.2% exp) vs the 10.1% (revised up) rise in January.

Americans’ spending fell 1.2% MoM in February (-1.0% exp) vs the 3.0% (big upward revision) jump in January.

Source: Bloomberg

That is the largest MoM decline in Americans’ income on record.

On a year-over-year basis, spending remains lower and while income growth tumbled, it is still up 4.3% YoY…

Source: Bloomberg

All of which means the savings rate tumbled from 19.8% in Jan to 13.% in Feb…

… as the Dec stimulus was spent but ahead of the March Biden stimulus.

What would the US ‘economy’ be without trillions of handouts from our overlords?

Authored by Bill Blain via MorningPorridge.com,

“I can only show you the door. You’re the one that has to walk through it.”

As Q1 wends to a close the threat of global recovery and higher rates overhang markets! Meanwhile, the market has spawned a whole new class of stocks: Trend Stocks – based on what we collectively believe about the future. Non Fungible Tokens (NFTs) look set to benefit from Trend Stock status!

And what an interesting week that was… Imminent vaccine wars, the “threat” post-pandemic economic recovery triggers rate rises thus undoing unsustainable P/E stock price multiples, and regulators seeking to regulate the vim out of the big dogs of Big Tech. Money is flowing back into cyclicals and fundamental stocks – but it seems based largely on what looks cheap to today’s already grossly inflated market. If it all looks like the ingredients for a corrective burst – well who knows?

There are a couple of victims out there. I feel most sorry for AstraZeneca and Oxford University – despite all their good intentions to produce a fast vaccine at zero profit and get it out there, they are on everyone’s solids list. The Europeans are using them as the sacrificial lamb for their botched rollout, and the Americans are being all high & mighty about numbers – although the good Dr Fauci did say “It’s still a very good vaccine.” I got the AZ jab and I ain’t dead yet. Good on them!

Pity the pilot and captain of the container ship Ever Given. How embarrassing. How dangerous to the global economy?

Next week will be slow ahead of the Easter Break and quarter-end. There is a deal of account balancing underway, so we may yet see some moves. It might be an opportunity to take stock of where markets are.

What’s going to happen in Q2?

Clearly the theme of vaccine rollout and recovery will lead, putting more pressure on rates and stock returns, and upping the ante on investors to find returns. That’s unlikely to be in bond markets – meaning the focus will be on already over-priced stocks and, as ever, finding the next new new thing.

The new new things become increasingly confusing the older we get. Its difficult to perceive new opportunities when they flip around all our existing experiences – especially when you are an aged old market hack like myself. Much of the stuff I look at surprises me because it just sounds so unlikely. I often take the view the market must be delusional to think some of the stuff will ever be adopted.

Much of what I see today I really don’t understand. I look at a stock at some insane valuation, compare its visions and promises to its competitive threats, the barriers to adoption and everything else and think; “this is daft.” But then I panic. I am not especially clever, so if it’s so obvious to me this is a delusional price then why aren’t smarter people also seeing it? Fear takes over. Fear is the mind-killer and investment paralyser.

The reality is often what I think is delusional today is someone else’s transformational vision of the market tomorrow, raising new opportunities and futures. Fortunately, I am surrounded by younger and smarter colleagues who take the time out to explain how things are changing, developing and finding adoption in the Tech sectors that are completely beyond my ability to catch up on, let alone comprehend.

For many of us over a certain age, it does feel like the speed of change, rollover and invention across the Tech sector is way-ahead-of-itself. Many of my clients agree it feels a bit like 1999 – with the dot.com bubble about to burst. Maybe it will – but there is a whole lot of new “stuff” that is going to occur!

Therefore, I am inventing a new category to follow: Trend Stocks

The emerging theory of Trend Stocks (invented this morning as I walked into the office) is based on two factors:

• The first is the Trading aspect to Trend Stocks:  This is the art of being able to read the behaviour of crowds and be indifferent to the crowd’s ability to differentiate between delusion versus adoption probabilities. The trick is to understand what the market believes it to be – following the Trend. There is absolutely nothing wrong with exploiting the phycology of crowds to play these “Trend Stocks”. The trend is your friend. Trend Stock Trading is all about trading the Zeitgeist…

• The second is the Investment aspect of Trend Stocks – the art of looking past the 80 to infinity times earnings stocks and picking the long-term winners – is the difficult part. Trying to pick winners from what new new thing Tech stocks are emerging is art – where it helps to have a healthy imagination.

Let’s take the latest market Trend Stock Trend : Non-Fungible Tokens.

When I read about someone selling a digital photo as a Non-Fungible Token for $69 mln I literally snorted. Oh, the foolishness of the rich. But I was intrigued in respect to ownership in the digital economy.

There is an article in the Times this morning on Spotify: Pressure is growing on Spotify to change its tune on paying artists. It confirms what we all know; despite the success of streaming and the simplicity of having every track available on download, most artists receive a pittance in earnings for streaming. One area of the digital economy that could innovate NFTs is music. Imagine if music fans would go back in time, and actually own the music their favourite artists produce?

There was a time when I owned literally thousands of vinyl albums. Foolishly, and unaware of the future, I gave most away in the 80s swapping them for CDs, and then dumping those for downloads and then streaming. I am now trying to rebuild my collection. Every time I buy a new pressing of an old album, it usually comes with a code to enable me to download an uncompressed Hi-Res version of the album.

Will NFTs become a basis for selling music as an alternative to streaming? If bands can sell an album giving blockchain registered owners unlimited rights to listen, that’s much more profitable for them. But it makes the assumption owning a digital asset gives the same pleasure and customer utility as owning a physical piece of Vinyl.

I will continue to spend my pocket money scouring second hand record stores and buying new pressings. I get a real buzz handling the new 180 gramme pressings. They send a shiver down my spine. But will I buy an album in NFT form? It will be same quality as hi-res streaming and I won’t get that same buzz of tangible ownership and the joy of vinyl. I want to own physical music. I like owning racks of records. And I also have racks of CDs…

We were debating this in the virtual office y’day and I was utterly surprised as younger colleagues disagreed and said they’d rather own the digital rather than hard asset. That argument developed through the afternoon as I learnt about luxury brands selling digital goods. I countered with my killer argument:

“So, what would be the point in owning a digital Aston Martin?”

Quick as flash young Richard quipped back “More reliable and fewer repairs!”

But the reality is the growing digital community actually is buying expensive digital smeakers, handbags, and even, (wait for it) digital digital watches! NFTs are their proof for digital ownership. There is a Trend underway: This week US stock Hall of Fame Resort and Entertainment (HOFV) announced a tie-up allowing it to sell NFT products linked to professional football and sports stars. The stock doubled. If you think that’s daft how about virtual sneakers – $10k for a virtual shoe you can’t wear.

Much to my initial disbelief, the NFT markets might be digital only, but they are increasingly real. Therefore, I’m putting NFT stocks into my Trend Stock follow list.

Just imagine…

5 years from now you and I are going to have a meeting to discuss an investment idea. I am going to show up at your office in my perfectly purring Aston, ostentatiously checking the time on my Patek Phillipe, and there will be no problems parking. I’ll be 40 kilos lighter, my hair will be back and curly again, and my new tailored suit will fit perfectly. You will meet me on the forecourt and whisk me straight to the meeting in your perfect office adorned with original Banksys with no need for security checks.

Of course.. we will actually both still be at home using the latest virtual reality sets. Heck, I won’t even be there, having programmed my Bill Blain slim-line avatars to be even better Bill Blains than this one..

US equity futures and global markets rose this morning, continuing yesterday’s torrid late day surge, as investors looked past supply chain disruptions and focused on the optimistic targets for vaccinations and economic re-openings, after Joe Biden doubled the goal for his vaccination drive even though Covid-19 cases keep rising, and the Federal Reserve freed banks from pandemic restrictions on dividends. Oil rebounded and pushed Treasury yields higher, prompting investors to buy undervalued energy and bank stocks ahead of what is expected to be the fastest economic growth since 1984. Investors awaited key income, spending and inflation data later in the day.

Risk appetite made a comeback across the world on economic-recovery bets, capping a volatile week beset with vaccine-supply disputes, a traffic block on the Suez canal and further deterioration in China’s relations with the West. The renewed optimism helped investors look past another poor 7Y debt auction in the U.S.

“Like a flickering light bulb, the tone of the market has somehow altered from angst to optimism, spurred by President Biden’s doubling of the U.S. vaccine-rollout target and the Fed’s end to pandemic-era dividend cuts,” Nema Ramkhelawan-Bhana, a strategist at Rand Merchant Bank in Johannesburg, wrote in a note. “It’s remarkable how little it takes to shift the mood.”

After the reflation trade faded early this week, it was back with a bang on Friday when inflation jitters appeared to take the upper hand again, because as the 10Y yield jumped 5bps today..

… futures gains were capped and pushed Nasdaq futures back in the red.

At 740 a.m. ET, Dow E-minis were up 129 points, or 0.40%, S&P 500 E-minis were up 7.5 points, or 0.19% and Nasdaq 100 E-minis were down 42.75 points, or 0.33%.

Among the notable premarket movers:

• Oil giants Exxon, Chevron, Exxon, Marathon Oil, Occidental Petroleum and Devon Energy rose between 0.7% and 2.6% as crude prices gained 2%.
• Nio dropped about 1% as the Chinese electric vehicle maker said it would halt production for five working days at its Hefei plant due to a shortage in semiconductor chips.
• Big banks JPMorgan Chase, Bank of America, Wells Fargo, Citigroup, Goldman Sachs and Morgan Stanley were up between 0.6% and 1.8% in premarket trading.
• Cruise-line operators Royal Caribbean Cruises Ltd. and Carnival Corp. rose at least 2.9% in premarket trading.

In Europe the Stoxx 600 Index had gained 0.6% by 750 a.m. Eastern Time with miners by far the best performers, after overnight gains on Wall Street as U.S. President Joe Biden doubled his vaccination target for the first 100 days. European equities rose at the end of a volatile week of trading as fresh U.S. vaccine targets boosted optimism about global growth prospects. Value and cyclical shares led broad sector gains in Europe as miners jumped 2.3%, while oil shares also rallied as the Suez Canal blockage continued. Banks outperformed, while health-care rose the least. Stocks in Europe have whipsawed since mid-March on concern over whether the rising virus rate and setbacks in the vaccination program will delay the economic reopening. Still, many market players are bullish about the region’s equities as cheap and cyclical shares gather pace, and the Stoxx 600 is less than 2% away from a record reached in February 2020. “We look set for a decent end to the week,” said Michael Hewson, chief market analyst at CMC Markets. “It has been notable this week that for all the concerns about a slowdown in Europe and a delay to an economic reopening that any dips in European stocks have been fairly shallow ones. This suggests that for all of the concerns about valuations, in Europe at least the appetite for stocks is still there.” The Stoxx 600 is up 5.3% in March and poised for a fourth straight quarterly increase.

Earlier in the session, the MSCI Asia Pacific Index added 1.3%, poised for their biggest advance in over two weeks, driven by gains in technology firms. Consumer discretionary and financials were also among the biggest contributors to the broad rally in the MSCI Asia Pacific Index. Chinese stocks rebounded, with the CSI 300 adding 2.3% after ending Thursday at a new low this year. Shares climbed ahead of earnings reports from the nation’s largest banks due later on Friday. TSMC was the largest single boost to the Asian benchmark, driving gains in Taiwan’s benchmark as well.

Japanese shares were also strong as they advanced for a second day, with electronics and automakers climbing with help from a weaker yen amid optimism over Covid-19 vaccines and after the yen weakened against the dollar. Electronics and auto makers were among the biggest boosts to the Topix index, with all 33 industry groups gaining. SoftBank Group and Advantest were the biggest contributors to the rise in the Nikkei 225. The yen slightly extended its loss through 109 per dollar. Asian stocks rallied broadly, following U.S. peers higher after President Joe Biden announced a new goal of administering 200 million Covid-19 vaccine doses in his first 100 days in office. Meanwhile, the Federal Reserve announced banks that clear stress tests can raise dividends after June 30. Even with two days of strong gains, the Nikkei still finished the week with with a loss of over 2%. Theblue chip gauge dropped below he 30,000 mark last Friday after the Bank of Japan announced a plan to shift its exchange-trade fund purchases to the focus on just the Topix. “It may be difficult for the Nikkei 225 to push above 30,000 without the support of the Bank of Japan,” said Ayako Sera, a market strategist at Sumitomo Mitsui Trust Bank. “The Topix currently looks a little on the expensive side, but with time, corporate profits will come out and justify the strength.”

“There is some risk-on trading with Biden announcing a doubling of the vaccination target for his first 100 days in office and German Chancellor Merkel backing down from her plans for a strict five-day lockdown over Easter,” said David Forrester, a currency strategist at Credit Agricole CIB in Hong Kong. “The Fed is also going to lift pandemic-era limits on U.S. bank dividends from mid-year for those banks that pass a stress test”

In rates,Treasuries were cheaper by 5bp at long-end of the curve, follow a wider bear-steepening move in bunds and gilts as European stocks and U.S. futures advance. 10-year Treasury yields around 1.68%, higher by nearly 5bp, with bunds gilts lagging by almost 1bp each; long-end-led losses steepen 2s10s by more than 4bp, 5s30s by nearly 2bp. Core EGBs continued to lose haven bid after Germany March IFO beat expectations. Raft of U.S. data Friday includes February personal income/spending. U.S. swap spreads are widening into the back-up in Treasury yields, led by intermediates. 

In FX, the dollar fell against most Group-of-10 currencies after risk appetite was boosted by a quickening vaccine rollout in the U.S. and the Federal Reserve’s move to lift curbs on dividend payouts. Treasury yields eased after a lackluster seven-year auction, with traders focused on quarter-end flows. Investors are awaiting U.S. employment figures due next week after a report Thursday showed applications for jobless benefits fell to a pandemic-era low last week.

Global equities remain just under record highs as investors consider progress in the fight against Covid-19 and the risks of inflation from heavy stimulus. The U.S. recovery looks on track with latest data showing a bigger-than-forecast drop in weekly jobless claims. Federal Reserve Chair Jerome Powell​ reiterated the U.S. central bank would wait until the economy has “all but fully recovered” to pull back extraordinary monetary support.

To the day ahead now, and US data releases include February’s personal income and personal spending, and the preliminary reading of wholesale inventories for February, along with the final reading of March’s University of Michigan consumer sentiment index. Over in Europe, there’s also the Ifo business climate indicator for March from Germany, Italian consumer confidence for March and UK retail sales for February. Central bank speakers include the ECB’s Rehn and the BoE’s Saunders and Tenreyro, while the virtual summit of EU leaders will continue into today.

Market Snapshot

• S&P 500 futures up 0.3% to 3,913.00
• SXXP Index up 0.8% to 426.25
• MXAP up 1.3% to 204.82
• MXAPJ up 1.4% to 676.36
• Nikkei up 1.6% to 29,176.70
• Topix up 1.5% to 1,984.16
• Hang Seng Index up 1.6% to 28,336.43
• Shanghai Composite up 1.6% to 3,418.33
• Sensex up 1.4% to 49,129.67
• Australia S&P/ASX 200 up 0.5% to 6,824.23
• Kospi up 1.1% to 3,041.01
• Brent futures up 1.7% to $62.97/bbl
• Gold spot up 0.1% to $1,728.31
• U.S. Dollar Index down 0.2% to 92.70
• German 10Y yield up 6 bps to -0.36%
• Euro up 0.1% to $1.1778

Top Overnight News from Bloomberg

• European Union leaders gave their guarded support to a plan to restrict vaccine exports after it emerged the bloc sent more shots to the rest of the world than it has given to its own people
• Efforts to dislodge the massive Ever Given container vessel blocking the Suez Canal will take until at least next Wednesday, longer than initially feared, raising the prospect that the incident will trigger disruptions across global supply chains from oil to grains to cars
• The downgrade of a major property firm has deepened investor concern about China’s debt- laden real estate sector, as defaults among onshore corporate borrowers surge to a record high.
• U.K. retail sales posted a modest rebound in February after a brutal start to the year, when a lockdown to contain the coronavirus forced non-essential stores to close.

Quick look at global markets courtesy of Newsquawk

Asia-Pac stocks traded mostly higher following the rebound in the US where small caps atoned for the prior day’s underperformance. ASX 200 (+0.5%) was propped up by strength in telecoms and commodity-related sectors but with upside capped by weakness in defensives and concerns regarding Australia’s ties with its largest trading partner after Chinese industry representatives confirmed that some Australian hay imports were halted and that they are seeking alternative sources, while Nikkei 225 (+1.6%) continued to outperform and reclaimed the 29k level amid a weaker currency and with the JPY-risk dynamic intact. Hang Seng (+1.6%) and Shanghai Comp. (+1.6%) adhered to the positive mood with Xiaomi and Great Wall Motor among the biggest gainers in Hong Kong after news that the smartphone maker plans to make EVs and is in discussions to partner with and use Great Wall Motor’s factory for the production. Attention was also on a deluge of earnings releases including China’s oil majors CNOOC and PetroChina lagged. Finally, 10yr JGBs were relatively flat with demand hampered by the heightened risk appetite and following on from another soft 7-year auction stateside, although the downside in JGBs was stemmed amid the BoJ’s presence in the market for JPY 850bln of JGBs with mostly 1yr-3yr and 5yr-10yr maturities.

Top Asian News

• Billionaire Mistry’s Family Loses Court Battle in Tata Feud
• China’s Tariffs on Australian Wine to Last 5 Years as Ties Sour
• China’s Central Bank Estimates Potential Growth of Under 6%
• Hong Kong Buyout Firm EmergeVest Said to Plan $250 Million SPAC

European equities (Eurostoxx 50 +0.6%) trade on a firmer footing bringing the Eurostoxx 50 to relatively unchanged levels for the week. Today’s session has seen a preference towards some of the more cyclically-exposed sectors with Basic Resources the clear outperformer, alongside gains in Autos and Oil & Gas names; albeit, gains for the latter have been trimmed alongside a pullback in crude prices. Note, the gains for cyclicals have not come at the expense of Tech/Momentum stocks with the Technology sector in Europe currently firmly in the green despite the US 10yr yield moving back above 1.65%. The latest IFO report from Germany failed to have much sway on indices. However, it is worth noting that the above-expectations report was relatively bullish on the German economy with IFO economists noting that German industry is very strong and order books have filled up. In terms of stock specifics, notable gainers including Smith Group (+6.8%) post-earnings and Maersk (+4.9%) in the wake of ongoing disruptions in the Suez Canal which has led to a surge in shipping costs. To the downside, Burberry (-1.3%) lags peers with the company embroiled in the Xinjiang criticism row, whilst Ocado (-0.6%) is also lower on the session after being downgraded at Berenberg.

Top European News

• Soaring French Infection Rate Causes Concern in Germany
• Allianz Agrees to Buy Aviva’s Poland Unit for $2.9 Billion
• Santander Signals Boost to Profit After Strong Start to Year
• Ex-Commerzbank CEO’s Fintech SPAC Falls in Amsterdam Debut

In FX, pre-weekend position paring and general consolidation may be contributing to the Greenback’s loss of momentum, but a marked improvement in risk sentiment and the latest recovery in crude prices are also dampening demand for the Dollar that has enjoyed 3 successive winning sessions vs most if not quite all rivals. The DXY closed above a key technical level on Thursday in the form of the 200 DMA that stands around 92.600 today, but could not quite reach 93.000 and chart proponents may have been somewhat disappointed or simply persuaded to take some profit and trim longs. However, the index and Buck remain firm overall ahead of US data including PCE inflation and final Michigan sentiment, with the former meandering between 92.836-684.

• JPY – No relief for the Yen at the Greenback’s expense at all or Tokyo CPI that was a tad firmer than forecast on balance, as Usd/Jpy continues to rebound through 109.00 and has now posted a new y-t-d high circa 109.55. Moreover, there is little in terms of resistance tech-wise before 110.00 and spot month, Q1 and FY end is yet to come on Monday for the Yen that carries a historically large rebalancing hedge SD for the last day of March.
• NZD/AUD – Conversely, the mood has improved somewhat down under along with risk appetite, and to the extent that the Kiwi is back near 0.7000 against its US counterpart, while the Aussie has actually reclaimed 0.7600+ status against the backdrop of Westpac’s dovish RBA call for QE to be extended in October at the current Aud 100 bn pace compared to Aud 50 bn previously and China slapping anti-dumping tariffs of up to 218.4$ on wine for 5 years with effect from March 28.
• GBP/NOK/CAD/EUR – Sterling is fending off an oil-fuelled Norwegian Krona for 3rd spot in the G10 ranks as Cable eyes 1.3900 and Eur/Gbp retests bids/support around 0.8550 due to risk back on impulses and hopes that the UK-EU vaccine stand-off will be resolved before too long. Meanwhile, Eur/Nok is straddling 10.1500, Usd/Cad has retreated through 1.2600 ahead of Canadian budget balances and Eur/Usd has pared declines from the low 1.1760 area that also arrested losses beneath a Fib retracement yesterday to take another look at 1.1800 in wake of an upbeat German Ifo survey slightly tarnished by the RKI’s stark warning of clear signs that the current COVID-19 wave might be more sever than the first.
• CHF/SEK – The other major laggards, as the Franc pivots 0.9400 vs the Buck and 1.1075 against the Euro post-SNB, while the Swedish Crown rotates either side of 10.1800 and reversed through par vs the single currency and its Scandinavian peer respectively with no real impetus from trade or retail sales data.
• EM – While the commodity bloc gleans traction from the aforementioned revival in crude, precious and base metals, the Try remains locked in a battle to hold above 8.0000 or deeper lows vs the Usd even though Turkish manufacturing confidence improved in March, as investors continue to shun the Lira on CBRT credibility grounds.

In commodities, WTI and Brent front month futures have started the last session of the week on the front foot, seeing a continuation of gains, but have since dipped off best levels. Fundamentally, support for prices has come alongside reports that it could take weeks to dislodge the Ever Given container ship from the Suez Canal. The blockage is leading to a squeeze in oil supplies and increasing fears of supply constraints over the coming weeks. Note, gains have been somewhat capped by growing COVID infection rates in Europe and emerging markets, such as Brazil and India. Rising case counts could push back expectations for a summer recovery for jet fuel demand. The May WTI contract trades just below the USD 60.00/bbl handle (vs low 58.32/bbl) whilst its Brent counterpart trades marginally above USD 63.00/bbl (vs low 61.85/bbl). Looking ahead, notable risk events include possible JMMC & OPEC+ source reports ahead of next week’s meeting, where expectations remain that OPEC+ will maintain current production. Note, today’s Baker Hughes Rig Count data is released in the UK today at the earlier time of 17:00GMT. Spot gold has traded choppy, but, like spot silver is firmer on the session alongside a slight pullback in the Dollar. That said, the DXY hit a four-week high yesterday and as such, gold is set for its first weekly decline in three weeks. Spot gold remains just below USD 1,730/oz (vs low USD 1,723/oz) and spot silver is trading around the USD 25.20/oz mark (vs low USD 25.04/oz). In base metals, LME copper follows the broader firmer sentiment and is up on the session and resides in proximity to USD 8,930/t. Additionally, there is growing optimism around the versatile metal amid its faster-than-expected COVID vaccination progress in the US. Lastly, Dalian iron ore is set for its first weekly rise in four weeks, amid declining steel inventories and rising demand in China.

US Event Calendar

• 8:30am: Feb. Personal Income, est. -7.2%, prior 10.0%
• 8:30am: Feb. Personal Spending, est. -0.8%, prior 2.4%
• 8:30am: Feb. PCE Deflator MoM, est. 0.3%, prior 0.3%; PCE Deflator YoY, est. 1.6%, prior 1.5%
• 8:30am: Feb. PCE Core Deflator MoM, est. 0.1%, prior 0.3%; PCE Core Deflator YoY, est. 1.5%, prior 1.5%
• 8:30am: Feb. Real Personal Spending, est. -1.0%, prior 2.0%
• 8:30am: Feb. Retail Inventories MoM, est. 0.8%, prior -0.6%, revised -0.5%; Wholesale Inventories MoM, est. 0.8%, prior 1.3%, revised 1.4%
• 8:30am: Feb. Advance Goods Trade Balance, est. -$86b, prior -$83.7b, revised -$84.6b
• 10am: March U. of Mich. 1 Yr Inflation, prior 3.1%; 5-10 Yr Inflation, prior 2.7%
• 10am: March U. of Mich. Current Conditions, est. 93.1, prior 91.5; Sentiment, est. 83.6, prior 83.0;  Expectations, est. 78.8, prior 77.5

DB’s Jim Reid concludes the overnight wrap

Markets zig-zagged around yesterday like me on the fairways early next week. At lunch time the Stoxx 600 was as much as -1.02% lower before clawing all the way back to nearly flat (-0.07%) by the close. The US followed the trend (-0.92% in early trading) and continued on the path higher after Europe went home before eventually closing +0.52% higher on the day. 20 of the 24 S&P 500 industry groups rose yesterday, while over 80% of all S&P 500 constituents were up. Banks were the best performing industry (+2.28%), followed by other cyclicals such as consumer services (+2.02%), transportation (+1.83%) and autos (+1.58%). Energy stocks (+0.25%) stabilised somewhat even as oil prices fell back over -4% yesterday. Tech stocks struggled even if the NASDAQ managed to recover from an intraday low of -1.35% to end the session up +0.12%. However megacap tech continues to underperform with the NYFANG index down another -2.30% yesterday and now down -4.57% on the week so far.

A focal point in rates was the 7-yr Treasury auction which saw demand fall short of dealer’s expectations as the notes were awarded at 1.30% – 2.5bps higher than just prior to the auction. This was better than last month’s very bad equivalent, but still worse than average. Immediately after 10yr yields rose nearly 2bps and by the close had finished up +2.5bps overall. However this might still put them on track for their biggest weekly decline since last June, having fallen by -9.8bps since the start of the week. The moves came as Fed Chair Powell continued to strike a dovish tone, saying in an interview yesterday that support would be pulled back “when the economy has all but fully recovered”. Nevertheless, market pricing continues to outpace the Fed’s dot plot, with a rate hike fully priced in by Q1 2023, even though the dot plot last week indicated that rates would still be on hold at the end of that year. Over in Europe, sovereign bond yields declined, with those on 10yr bunds (-3.1bps), OATs (-2.7bps) and BTPs (-1.1bps) all moving lower.

Asian markets have taken Wall Street’s lead this morning with the Nikkei (+1.47%), Hang Seng (+1.46%), Shanghai Comp (+1.41%) and Kospi (+1.03) all posting strong gains. Futures on the S&P 500 are up +0.40% while those on the Nasdaq are up +0.61%. Large US banks are extending gains in after hours trading partly helped by the Fed decision to allow those large US banks that clear the next round of stress tests with sufficient capital to resume dividend increases at the end of June. This signals an end to pandemic-era restrictions that dragged on financial stocks last year. JPM (+0.92%), Bank of America (+1.09%), Citigroup (+1.23%) and Wells Fargo (+0.97%) all traded higher in extended trading. Yields on 10y USTs are flattish this morning while those on New Zealand’s 10yrs are up +5.3bps likely on news that the RBNZ will lower its weekly QE target due to lower issuance from the Treasury. Australia’s 10y yields are down -2.5bps. Crude oil prices are trading up c.+1% this morning having fallen around -4% yesterday.

The moves in markets came amidst some strong economic data releases out of the US yesterday where the weekly initial jobless claims for the week through March 20 fell to 684k (vs. 730k expected), which is their lowest level since the pandemic began. Furthermore, the 4-week moving average was also at a post-pandemic low of 736k, as were continuing claims for the week through March 13, which fell to 3.87m (vs. 4m expected). And finally, the latest estimate of Q4 growth was revised up two-tenths, to now show an annualised pace of +4.3%.

Nevertheless, it’s Covid that has partly hampered the recent risk rally, with the data showing a sustained rise in the global case count since mid-February that’s showed no sign of abating thus far, and has led investors to ponder what a renewed bout of restrictions could mean for the world economy. European Commission President von der Leyen yesterday announced that “we’re at the start of the third wave of the pandemic.” In Poland, it was announced that nurseries and preschools would close, as the country reported a fresh record of 34,151 new cases. In turn, this has sent the Polish Zloty to its weakest level against the Euro since 2009. Elsewhere, the Finnish government has submitted a proposal that would see temporary restrictions on movement in the worst-hit areas for 3 weeks, with people only able to leave their homes for essential reasons or outdoor recreation. Meanwhile France extended their lockdown to three additional regions – the Nievre, Rhone and Aube areas – with the government announcing that the newest wave has a higher number of younger people being admitted to hospitals. German Chancellor Merkel also signalled that she would be declaring France a “high-risk Covid Area.” Overnight, French President Macron has said that new measures to contain the epidemic might be needed in the coming weeks and added that “The next few weeks will be tough.”

On the more upbeat side, President Biden announced in his first press conference since becoming President that his administration was upwardly revising its goal of 100m shots within his first 100 days to 200m shots within the same time frame. Supply is expected to pick up in the coming weeks as manufacturers increase shipments, particularly Johnson & Johnson which only received authorisation more recently. The US has administered more than 130mn jabs so far, with 16.5mn coming during the final days of President Trump’s administration. Roughly 13% of the country is fully vaccinated at this time.

President Biden’s press conference otherwise focused on his upcoming long-term economic agenda, which he is expected to unveil next week. He promised a new “paradigm” for the middle class with a focus on expanded support for health care, tax changes aimed at companies and the wealthy, along with a new infrastructure plan. When asked about the filibuster, the measure in the Senate that forces much of the non-fiscal and non-judiciary votes to pass by at least a 60-40 vote margin, President Biden gave his closest endorsement yet to getting rid of the rule, which Republicans argue would make policy much more volatile going forward. Lastly on China, Biden said that China has “an overall goal to become the leading country in the world, the wealthiest country in the world and the most powerful country in the world. That’s not going to happen on my watch, because United States is going to continue to grow and expand.”

Meanwhile at the EU leaders’ summit newly elected Italian Prime Minister Draghi urged other EU leaders to use the bloc’s new rules to make sure that there is an adequate supply of vaccines for the member states. He also endorsed the EC’s plan to curb exports of vaccines and medical equipment, this comes after reports that the EU has exported over 77mn doses vs the 62mn does administered in the region. EC President von der Leyen used slides during the meeting that showed that the EU expects to receive about 100mn jabs in the first quarter of the year and 360mn in the second quarter.

Turning to the Suez Canal, the buildup of congestion has got worse over the last 24 hours as the Ever Given container ship remains stuck in place. In terms of latest, the Suez Canal Authority has said that the Ever Given has been partially re-floated and moved alongside the canal bank. GAC, a Dubai based marine services company has said on its website that “Convoys and traffic are expected to resume as soon as the vessel is towed to another position”. Just as we are about hit print, Bloomberg is reporting that the work to dislodge the container vessel will take until at least Wednesday next week as more time will be needed to dredge sand.

Looking at other markets, it’s clear that the risk reversal over the last few days has been having effects elsewhere, with the dollar strengthening +0.36% to a 4-month high, while the key industrial bellwether of copper (-1.73% yesterday) has seen prices fall to a 1-month low. Bitcoin investors have been hit too, with the cryptocurrency down a further -3.79% yesterday to $52,001, which leaves prices down by c.16% from their intraday peak of $61,742 back on March 13.

To the day ahead now, and US data releases include February’s personal income and personal spending, and the preliminary reading of wholesale inventories for February, along with the final reading of March’s University of Michigan consumer sentiment index. Over in Europe, there’s also the Ifo business climate indicator for March from Germany, Italian consumer confidence for March and UK retail sales for February. Central bank speakers include the ECB’s Rehn and the BoE’s Saunders and Tenreyro, while the virtual summit of EU leaders will continue into today.

Roughly 18 months after WeWork’s planned IPO collapsed, effectively killed by a stream of leaks about its rapidly-sinking private valuation (which bottomed out around $10 billion, down from a $47 billion peak), the office-space rental company will soon make its debut on the public markets thanks to the SPAC boom.

Days after leaked reports offered a glimpse into WeWork’s pandemic-era financials, the SoftBank-backed private company has reached a deal with BowX Acquisition Corp (where basketball legend Shaq serves as an advisor/pitchman), to take the company public in a $9 billion deal (that figure includes the value of WeWork’s remaining debt).

As we learned the other day, WeWork actually saw its losses shrink in 2020 compared with the prior year after cutting its operating expenses to the bone as it shuttered office spaces around the world and laid off staff.

Few weeks late — or couple yrs, depending on your point of view —

WeWork has deal to go public https://t.co/66N509KV3u

— Dan Primack (@danprimack) March 26, 2021

WSJ added that WeWork would also raise $1.3 billion, including $800MM in a so-called private investment in public equity, or PIPE, from Insight Partners, funds managed by Starwood Capital Group, Fidelity Management and other investors.

WeWork became infamous for its claims about “elevating the world’s consciousness”, a mission statement featured in its original IPO prospectus thanks to former CEO/co-founder Adam Neumann, who was pushed out of the company (with a juicy billion-dollar golden parachute) after investors and investment banks turned on him for insisting that control of the company be concentrated within his family, something the firm’s would-be backers were unwilling to stomach.

The deal is hardly a surprise. A few days ago, Bloomberg’s Matt Levine pointed out that, according to details leaked to the press, the WeWork deal with BowX would actually be a “de-SPAC” deal. In other words, while BowX might be taking WeWork public, it stands to reap a swift exit as WeWork is lining up major institutional investors to invest in the parallel “Private Investment in Public Equity” – or PIPE – vehicle.

Here’s the other point. This is a “de-SPAC merger,” in which WeWork will merge with BowX, take its $483 million, and become a public company. It is natural to emphasize the SPAC here: It is a SPAC deal, that is the mechanism that WeWork would use to go public, and the SPAC and its sponsor would play a major role in both the deal to go public and WeWork’s future as a public company.

But I wouldn’t emphasize it too much. If this deal goes through, more than half the money WeWork raises will come not from the SPAC but from the parallel “private investment in public equity,” or PIPE, transaction that it does with big institutional investors. WeWork is apparently out on the road now, with a pitchbook, explaining to big institutional investors why it’s a good investment at a $9 billion valuation. Eventually that will work, or not; it will find buyers at that price, or it will have to lower the price, or it will have to give up on the deal and stay private. Or else demand – from these big institutional investors in these private meetings – will be so strong that WeWork will be able to upsize the deal and raise more money, or it will be able to raise the price and go public at a $12 billion valuation or whatever.

At the top of the hour, WeWork CEO Sandeep Mathrani and Vivek Ranadivé, BowX founder and owner of the NBA’s Sacramento Kings and founder of Tibco Software, will appear on CNBC to answer questions about the deal.

Egypt Today reports two trains have collided in Sohag, Upper Egypt, “resulting in derailing three passenger carriages.” There were reports of at least 50 people injured, according to Sputnik News. 

#BREAKING
Several casualties reported as two trains collide near Sohag governorate, Egypt pic.twitter.com/4ooAHbEmZ2

— Daily News Egypt (@DailyNewsEgypt) March 26, 2021

Reporting of the incident is scant at the moment, but Twitter users have been uploading alleged images of what appears to be passenger railway cars derailed in a twisted mess. 

Here are more photos of the incident. 

🇪🇬 #egypt

Mısır’ın Sohag kentinde iki tren çarpıştı. Ölü ve yaralılar var. pic.twitter.com/z6PaIzEU81

— Frank William (@frankyedekkk) March 26, 2021

Preliminary photos of a collision accident two trains in the governorate of Sohag, south of Egypt pic.twitter.com/gIBmVDo7Yr

— spriters (@neccamc1) March 26, 2021

#Egypt : Crash involving passenger trains in Sohag governorate – unclear how many casualties #سوهاج #مِصر pic.twitter.com/7NUzVGVCJe

— sebastian usher (@sebusher) March 26, 2021

Poor Egypt this week, first the Suez Canal crisis and now Sohag. 

*This story is developing… 

The world got another wake-up call this week about the overreliance on complex global supply chains. As of Friday, the massive containership, “Ever Given,” remains stuck in the canal, unable to be refloated, paralyzing the world’s most important shipping lane. 

Ever Given is one of the world’s largest containerships, with approximately 20,000 shipping containers of goods. The shipping lane is a vital linkage between Asian factories and customers in Europe and the US. 

Reuters reports the Suez Canal Authority (SCA) is looking forward to cooperating with the US to refloat the stranded containership that has blocked the canal since Tuesday. 

“The Suez Canal Authority (SCA) values the offer of the United States of America to contribute to these efforts, and looks forward to cooperating with the US in this regard,” it said in a statement.

Shoei Kisen, the Japanese owner of the ship blocking the Suez Canal, aims to dislodge the vessel from the canal bank by Saturday. But as Bloomberg reports, the process to refloat the ship could “take until at least next Wednesday.” 

Peter Berdowski, CEO of Dutch company Boskalis who has been tasked with dislodging the vessel, warned Ever Given “could be stuck in the canal for weeks.” 

So actual timelines on when the vessel will be unstuck are unclear. The blockage is wreaking havoc across global supply chains, and crude prices were higher on Friday morning on mounting fears the containership will be stuck for much longer than initially anticipated. Since the containership got stuck on Tuesday, crude prices have been chopping around 57-handle to 61-handle. 

On Friday, tugboats and suction dredger crews worked around the vessel’s front hull to remove sediment. The task to refloat the 200,000-ton ship may involve removing containers to lessen the vessel’s weight. 

Since Tuesday, tugs and diggers have been unsuccessful in attempting to refloat the stranded vessel. As hundreds of ships pile up on either end of the canal entrances – A.P. Moller-Maersk A/S and Hapag-Lloyd AG have instructed their vessels to take alternative routes to avoid the canal. Vessels have been instructed to reroute around the Cape of Good Hope. 

The canal is one of the world’s most important shipping lanes, with 12% of global trade and 8% of liquefied natgas traverse the canal and nearly two million oil barrels each day. Every day the canal is blocked, it halts about $9.6 billion of trade.

“The number of ships loaded with billions of dollars worth of goods waiting to traverse the canal has risen to more than 300,” according to Bloomberg data.

Reeling from the blockage, marine freight rates are surging this week as companies race to find alternative shipping lanes. 

According to Bloomberg, the cost to ship a 40-ft. container from China to Europe has risen to $8,000, up 4x year-over-year. Suezmax vessels, which carry about 1 million barrels of crude, are now chartering for approximately $17,000 per day, the most since summer 2020. 

Reuters notes the Black Sea to Mediterranean fuel shipping rates rose this week as traders attempt to bypass the blocked Suez canal.

On top of an already stretched global supply chain, manufacturers in Asia are already preparing for extended shipping delays due to the blockage. To get an idea of some of the goods that flow through the canal from the East to West, cargo aboard an HMM Co. vessel moored outside the canal is carrying frozen beef, paper, beer, auto components, chocolate, furniture, frozen pork, and other goods. 

Other reports include Caterpillar Inc. is facing shipping delays because of the canal blockage and is considering air freight for certain parts. 

Mark Ma, owner of Seabay International Freight Forwarding Ltd., a company that handles Chinese goods including toys, pillows and mattresses sold on Amazon, has 20 to 30 containers stuck in the canal. 

“If it can’t be resumed in a week, it will be horrible,” said Ma. “We will see freight fares spike again. The products are delayed, containers can’t return to China and we can’t deliver more goods.”

More reports indicate at least 10 LNG vessels from the Middle East with end destinations in Europe have been delayed. 

“Even if the route is liberated within one week, there is a large queue of cargoes lining up to cross the canal,” said Carlos Torres Diaz, Rystad’s head of gas and power markets. “The return to normal flow will take some time.”

The knock on effects of the blockage is rippling through the global supply chain and is the “worst-case scenario” for global trade. 

Democrats are furious after Georgia Gov. Brian Kemp last night signed an election bill that requires strengthening voting rules in the Peach State by limiting the number of ballot drop boxes, establishing photo ID requirements for absentee voters, and prohibiting distribution of food and drinks to voters waiting in line.

Just an hour before the signing, the GOP-controlled Georgia General Assembly passed the bill on a party-line vote as Democrats, including elected representatives from around the state, gathered to protest. The backlash was intense, and during the scuffle, at least one lawmaker was arrested, with video of her being led away by police going viral.

The bill is just one of dozens being considered in state capitols around the country in the wake of last year’s presidential election, where signs of irregularities in states like PA, MI and even GA were repeatedly ignored by Democrats. Recently, the Washington Post recanted a story where it claimed that President Trump had personally pressured Georgia election officials, drawing a heated response from Trump himself.

According to a summary from the Hill, the bill includes sweeping changes to the state’s voting rules and procedures.

It would require voters to provide a driver’s license or state-issued ID card number to request and submit absentee ballots, and it would curtail the use of ballot drop boxes, limiting their placement to early-voting locations and making them accessible only while the precinct is open.

The legislation also gives the Georgia State Elections Board the ability to effectively take over county elections boards in areas that it determines are in need of oversight. The secretary of state would also be removed as chair of the State Elections Board, a proposal that critics say would strip the state’s top elections official of a key power.

The bill also takes aim at the state’s absentee-ballot request period, setting the deadline for voters to request absentee ballots at 11 days before an election. It also calls for prohibiting people from giving food or drinks to voters waiting in line to cast their ballots.

Democrats slammed the bill, and others like it that are circulating in other states, as retaliation to the GOP’s recent string of losses in critical Senate races (along with the presidential race, as we noted above). Twin victories for Democrats in GA special elections on Jan. 5 helped stoke support for the law, as Democrats relied on aggressive get-out-the-vote campaigns, absentee voting and millions in out-of-state dollars to clinch narrow victories for Raphael Warnock and Jon Ossoff.

Stacey Abrams, former gubernatorial candidate who has burnished her reputation as a national “voting rights” advocater, predicted a swift passage for the bill, accusing Republican lawmakers of trying to limit public review and awareness of the proposals.

From passage of the #SB202 voter suppression bill targeted at Black and brown voters to the arrest of a Black legislator who was advocating for the voting rights of her constituents, today was a reminder of Georgia’s dark past. We must fight for the future of our democracy #gapol pic.twitter.com/IZWZGAX9RT

— Stacey Abrams (@staceyabrams) March 26, 2021

During the chaotic protests held at the capitol Thursday evening as lawmakers in the assembly passed the bill, Georgia State Representative Park Cannon was arrested during a protest at the state capitol last night.

“I am a legislator”: Georgia State Representative Park Cannon identified herself as a lawmaker as she was arrested Thursday night after protesting a voting bill that voting rights groups believe will make it harder for communities of color to cast their ballots. pic.twitter.com/lTVRnGV3vt

— CBS News (@CBSNews) March 26, 2021

Per the Hill, Cannon was cuffed Thursday after she repeatedly knocked on Gov. Kemp’s office door while he signed the bill.

After the arrest, Sen. Warnock visited Cannon in her holding cell at the Fulton County jail, and told reporters during an impromptu briefing out front that her arrest shouldn’t have happened. “She did not deserve this,” he said, adding that she was “shaken” by what happened.

Calls to boycott the state of Georgia – a playbook used by progressives a few years back after North Carolina passed a “transphobic” bathroom bill – have already started circulating on twitter.

It is time for businesses and sports teams to boycott Georgia. This is racist voter suppression.

— Norman Ornstein (@NormOrnstein) March 26, 2021

We imagine these calls will be amplified Friday morning by a legion of social media influencers urging their followers to join the boycott.

Authored by Jack Phillips via The Epoch Times,

Officers with the Los Angeles Police Department (LAPD) were attacked with smoke bombs, bottles, and rocks on March 24 as they attempted to clear out a homeless encampment at a park, according to video footage and the LAPD.

“Two unlawful assemblies were declared and dispersal orders were issued at Santa Ynez Street and Glendale Blvd due to officers being assaulted with rocks, bottles, and smoke bombs. Fencing is being installed and police will be there overnight,” the LAPD wrote in a tweet on March 24, adding that officers attempted to clear out Echo Park.

They were met with left-wing protesters, according to video footage of the incident.

The homeless camp has been criticized by citizens who live in the area, prompting the city to say it would move those living in the park to hotels, according to the Los Angeles Times.

Homeless residents say they have a right to stay in the park, which is public property.

“No one else may enter. 24 hr notice for those in the park to leave. Housing resources are being provided to everyone,” Los Angeles Police Chief Michel Moore wrote in a March 24 tweet.

Our people remain in the area around Echo Park tonight as fencing is installed. Those already inside the park in tents will be allowed to remain overnight. No one else may enter. 24 hr notice for those in the park to leave. Housing resources are being provided to everyone

— Chief Michel Moore (@LAPDChiefMoore) March 25, 2021

“The Los Angeles Police Department continues to ask for calm and cooperation as the installation of fencing in support of the Echo Park rehabilitation effort continues. Unfortunately, officers have received projectiles and refusals from individuals blocking streets in the area,” the LAPD wrote on Twitter.

Police told KTLA that there was misinformation being spread that officers deployed “tear gas” during the incident, saying that it was instead smoke caused by smoke bombs that were being used by anti-police demonstrators.

This is literally you right now.

Fuck you @LAPDChiefMoore @LAPDHQ pic.twitter.com/hhMst8oQVN https://t.co/M8P3sbWL0P

— People’s City Council – Los Angeles (@PplsCityCouncil) March 25, 2021

The left-wing activist group People’s City Council—Los Angeles wrote of the demonstrations: “YALL ITS GOING DOWN IN ECHO PARK.”

🚨🚨🚨

CALL TO ACTION! Show up tonight at 5 pm and stand in solidarity with the residents of Echo Park Lake! It’s going to go down tonight. We need a critical mass. Please show up. #EchoParkRiseUp pic.twitter.com/J6S5g5ffgK

— People’s City Council – Los Angeles (@PplsCityCouncil) March 25, 2021

Edward Juarez, a homeless resident, said he has been living in a tent at the park after he lost his job due to the COVID-19 pandemic and associated government-mandated lockdowns. Juarez said he was a photographer at events and concerts, which were closed down amid the lockdown orders, the LA Times reported.

“I just want to get out of here, it’s getting crazy,” he said of the scene.

“The pandemic has not even been lifted and they’re trying to evacuate people who have nothing anymore,” another homeless person, Jessee Mendez, said to KTLA.

Residents have told local outlets that the park is no longer a safe place for children, as they’ve found needles and numerous other health hazards.

A Change.org petition states that Echo Park is “virtually unusable” and is “becoming Skid Row,” referring to the downtown Los Angeles area where a number of homeless people and drug addicts live.

“As of late, activists and the current Los Angeles leadership, have sought to let unhoused peoples use all of the lake facilities and land for housing- Instead of using the $1.2 billion in Prop HHH funds we the voters approved to construct housing for the unhoused (None of which has been built),” the petition states.

After scrapping some senior bonuses, suspending several top executives and replacing the head of its asset management unit (where trade-finance funds co-managed with Greensill Capital were managed), Credit Suisse apparently has the money to toss overworked junior bankers a $20K ‘second bonus’. But the bank’s virtue-signaling when it comes to its treatment of junior bankers (currently a hot topic in the public discourse thanks to a handful of exhausted Goldman analysts) might not look so generous after its clients see their total losses from the collapse of the aforementioned funds.

According an exclusive report in the Financial Times arriving just one week after the Swiss bank published its 2020 annual report – in which the Swiss bank claimed in a section addressing the Greensill collapse that “Credit Suisse’s priority remains the recovery of funds for CSAM’s investors” – CS executives have tabulated its client losses at a whopping $3 billion, on some $10 billion in assets in the funds, which were stocked with assets structured by Greensill. After gating the funds on March 1, CS has reportedly returned more than $3 billion to its clients, with another $1 billion promised. Reuters reported that more than $1 billion in cash is left in the funds. But after spending the last three weeks trying to unwind a complex series of contracts underpinning the fund’s assets, the bank has determined that many of the firms financed by Greensill are unable, or unwilling, to make good on their debts.

Urs Rohner, Chairman of the Board of Directors and Thomas Gottstein, Chief Executive Officer.

The funds were marketed to CS’s “professional” – ie institutional – clients as low-risk vehicles, and now Credit Suisse is in the uncomfortable position of telling some of its most valuable clients, including wealthy individuals in the Middle East and pension funds in Switzerland (the bank’s backyard), that the funds it marketed as low risk vehicles that helped grease the wheels of international trade were actually stocked with claims on future sales of companies like GFG Alliance, Sanjeev Gupta’s steel empire, which owes $1.3 billion. SoftBank-backed construction startup Katerra is reportedly on the hook for $400MM.

Unfortunately for CS, as it goes about trying to collect on the money owed, there are several major creditors that are “dragging their heels” on repaying the Credit Suisse funds, according to a person briefed on the process of recovering the assets.

“I would stress that is the theoretical maximum,” said a person involved in the discussions. “I still expect losses to be much lower…It could be a long process though.”

In the long term, once courts have had an opportunity to adjudicate the avalanche of lawsuits, executives believe they might be able to cut that loss down to $1.5 billion. But that seems like a big “if”. At any rate, the final tally of losses might not be known for months, or years.

With these lucrative relationships hanging by a thread, Bloomberg reports that the internal investigation being carried out by the board is looking into top executives’ role in the trade-finance business.

Directors are reviewing the way in which supply chain finance funds were sold to investors, including its own wealth management clients, and how the bank managed conflicts of interest and a business relationship with Lex Greensill that spanned three divisions, one of the people said. The bank has reactivated a special crisis committee — led by chairman Urs Rohner and the heads of the audit and risk committees — to oversee the issues surrounding Greensill, according to its annual report.

Bloomberg reported that the investigation will examine CEO Thomas Gottstein’s role in the Greensill business. To be sure, even if the bank does find some culpability on Gottstein’s part, dumping a second CEO overboard within the span of 18 months isn’t exactly a good look. And at any rate, the bank’s clients probably wouldn’t care either way. Heads on platters aren’t going to put money back in their pockets.

But with the risk of losing billions of dollars in business over the episode, Credit Suisse is reportedly considering doing just that: Citing four sources from within the bank, Reuters reported that Credit Suisse is considering reimbursing some of the customers.

Switzerland’s second-largest bank this month closed around $10 billion of supply-chain finance funds that bought notes from Greensill. Of this, $3.1 billion has so far been repaid and more than $1.2 billion in cash remains in the funds, leaving more than $5 billion outstanding.

While Credit Suisse hopes more can be salvaged, the fact it is considering making investors in the funds good underscores concern that the debacle could see ultra-rich customers turn their back on it, three of the people said.

“Money is going to flow,” one person with direct knowledge of the discussions within the bank told Reuters. “Investors will get compensation. That’s unavoidable. It’s going to hurt.”

The total cost has yet to be determined, but “there is a proposal on the table to take over about 50% of the losses.”

While the report might just be a trial balloon, we can’t help but wonder how its shareholders might feel. Investment banks are supposed to rip clients’ faces off. Covering a third party’s duly deserved losses might set a dangerous precedent.