Category: zerohedge

Authored by Jonathan Turley,

Just yesterday, we discussed the censoring of a commentator by Twitter for merely expressing an opinion over the need for a “pause” on any federal mandates on Covid-19 as new research is studied.

Now, a former New York Times science reporter, Alex Berenson, has been suspended for simply quoting the results from a clinical trial by Pfizer and raising questions over any vaccine mandate. In the meantime, the White House accused both the Washington Post and New York Times of irresponsible reporting on Covid, but surprisingly Twitter has not suspended those accounts.  It is the license of the censor.  Twitter is unwilling to let people read or discuss viewpoints that it disagrees with as a corporation. Many on the left, however, have embraced the concept of corporate speech and censorship. It turns out that the problem with censorship for many was the failure to censor views that they opposed. With the “right” censors at work, the free speech concerns have been set aside.

I have little ability to judge the science on such questions. However, I welcome the debate. Yet, rather than answer such critics and refute their arguments, many people focus on silencing anyone with dissenting viewpoints like Berenson.

Berenson has been effectively confined to Substack by Big Tech due to his discussing dissenting views on the science surrounding Covid-19. His latest offense against Big Tech came when he posted the results published by Pfizer of its own clinical data. He claimed that the research showed little difference in morality between those in the trial with a vaccine and those given a placebo.

In the meantime, the White House sent out an all caps condemnation for “completely irresponsible” reporting on the infliction of vaccinated people according to another study.

Ben Wakana, deputy director of strategic communications and engagement for the White House, blasted the Washington Post over its headline about a study of a COVID-19 outbreak in Provincetown, Massachusetts on July 4th. The Post tweet read “Vaccinated people made up three-quarters of those infected in a massive Massachusetts covid-19 outbreak, pivotal CDC study finds.” Wakana responded “Completely irresponsible,. 3 days ago the CDC made clear that vaccinated individuals represent a VERY SMALL amount of transmission occurring around the country. Virtually all hospitalizations and deaths continue to be among the unvaccinated. Unreal to not put that in context.”

Completely irresponsible.

3 days ago the CDC made clear that vaccinated individuals represent a VERY SMALL amount of transmission occurring around the country.

Virtually all hospitalizations and deaths continue to be among the unvaccinated.

Unreal to not put that in context. https://t.co/BbmSNvQlrb

— Ben Wakana (@benwakana46) July 30, 2021

Wakana addressed the same issue with  a New York Times tweet stating “Breaking News: The Delta variant is as contagious as chickenpox and may be spread by vaccinated people as easily as the unvaccinated, an internal C.D.C. report said.” That sent Wakana into all caps: “VACCINATED PEOPLE DO NOT TRANSMIT THE VIRUS AT THE SAME RATE AS UNVACCINATED PEOPLE AND IF YOU FAIL TO INCLUDE THAT CONTEXT YOU’RE DOING IT WRONG.”

VACCINATED PEOPLE DO NOT TRANSMIT THE VIRUS AT THE SAME RATE AS UNVACCINATED PEOPLE AND IF YOU FAIL TO INCLUDE THAT CONTEXT YOU’RE DOING IT WRONG. https://t.co/gBkDbJ21xX

— Ben Wakana (@benwakana46) July 30, 2021

Now all three posters (Berenson, The Post, and The Times) were citing studies and accused on not putting them into context. However, only Berenson was suspended.

Obviously, none of these posters should be suspended and Twitter should not be enforcing one of the largest censorship programs in history. However, the silence of free speech supports, academics, and journalists to this hypocrisy is deafening.

The rise of corporate censors has combined with a heavily pro-Biden media to create the fear of a de facto state media that controls information due to a shared ideology rather than state coercion.  That concern has been magnified by demands from Democratic leaders for increased censorship, including censoring political speech, and now word that the Biden Administration has routinely been flagging material to be censored by Facebook.

This is why I have described myself as an Internet Originalist:

The alternative is “internet originalism” — no censorship. If social media companies returned to their original roles, there would be no slippery slope of political bias or opportunism; they would assume the same status as telephone companies. We do not need companies to protect us from harmful or “misleading” thoughts. The solution to bad speech is more speech, not approved speech.

If Pelosi demanded that Verizon or Sprint interrupt calls to stop people saying false or misleading things, the public would be outraged. Twitter serves the same communicative function between consenting parties; it simply allows thousands of people to participate in such digital exchanges. Those people do not sign up to exchange thoughts only to have Dorsey or some other internet overlord monitor their conversations and “protect” them from errant or harmful thoughts.

The late night Thursday attack of an Israeli-managed vessel in the Arabian Sea off the coast of Oman which left two international crew members dead was the result of a drone strike, the US Navy’s Fifth Fleet has said in a Saturday statement.

The US Navy had boarded and assisted in the distressed Liberian-flagged ‘Mercer Street’ tanker’s moving to safer waters on Friday after the incident which had initially been reported as possible piracy. The US military had immediately conducted an investigation in the aftermath, and is now citing “clear visual evidence that an attack had occurred,” according to the new statement.

“Initial indications clearly point to a (drone)-style attack,” the US Navy said, without naming specific evidence for that conclusion. Currently a pair of US warships, the aircraft carrier USS Ronald Reagan and guided missile destroyer USS Mitscher, are escorting the Mercer to a safe port.

London-based Zodiac Maritime, owned by Israeli billionaire Eyal Ofer, had issued a statement on Friday confirming that two crew members died as a result of the attack, including one Romanian and one British crew member. As we noted in our initial reporting, one prominent maritime security risk management firm is pointed to a likely drone attack.

This was followed by state media in Iran appearing to confirm that it was carried out by the Islamic Republic as “retaliation” for recent Israeli attacks and sabotage operations, including the latest airstrikes on Iran-backed targets inside Syria. 

Late in the day Friday and early Saturday, reports out of Israeli media and The New York Times have cited Israeli intelligence officials who say “several” drones struck the tanker:

The New York Times reported that two officials who spoke on condition of anonymity said that “the attack appeared to have been carried out by several unmanned Iranian drones that crashed into living quarters underneath the ship’s command center, or bridge.” This looks like a serious and complex attack that is not just a major escalation, but a new use of Iran drone technology.  

Drones carried out the attack on a tanker managed by an Israeli-led firm, killing two people, officials said — apparently the latest in a series of maritime clashes between Iran and Israel.@PatrickKingsley @ronenbergman https://t.co/luag310Uin

— Farnaz Fassihi (@farnazfassihi) July 30, 2021

US officials are also pointing the finger at Iran, reports CNN: “A US defense official familiar with the details of the incident said Friday that the tanker was attacked by an armed drone thought to be operated by Iran.”

So it appears the ‘tanker wars’ are back and in full force, with industry analysts Dryad Global describing that “this latest attack has the hallmarks of the ongoing Israel/Iran ‘shadow war‘”. The Israelis have taken the incident to the Untied Nations, likely also as part of efforts to halt nuclear negotiations in Vienna, which are already stalled at least into August.

Israel’s Foreign Minister Yair Lapid spoke with his British counterpart Dominic Raab, and noted “the need to respond harshly” to the attack on the Mercer Street oil tanker, his office says.

— Emanuel (Mannie) Fabian (@manniefabian) July 30, 2021

“Israel’s foreign minister said he has ordered the nation’s diplomats to push for UN action against Iran over a deadly attack on a ship managed by an Israeli billionaire,” AFP reports. “I’ve instructed the embassies in Washington, London and the UN to work with their interlocutors in government and the relevant delegations in the UN headquarters in New York,” Israeli Foreign Minister Yair Lapid said in a statement.

All of this likely means we’re about to see the Israelis escalate in a major way if the recent tit-for-tat history of military strikes is any guide. And none of this bodes well for the prospect of the upcoming seventh round of indirect US-Iran JCPOA nuclear talks in Vienna, which might prove to be derailed before they even get started again – and then there’s Iran’s new hardline president entering office in a matter of days on August 3rd, to complicate matters further.

Authored by Lance Roberts via RealInvestmentAdvice.com,

Market Rally Continues

Last week, we discussed that as the market hit new highs, further upside was likely limited. To wit:

“While the upside remains somewhat limited, given the already substantial advance this year, the rally will alleviate downside concerns momentarily. However, with that said, the extremely low level of volatility this year is reminiscent of 2017. The reason is that “stability” is fragile. In other words, stability ultimately leads to instability.“

For more information on the “instability of instability,” read “The Next Minsky Moment.”

Not surprisingly, the market didn’t make much headway this past week, given the current extended and overbought conditions. For now, “buy signals” remain intact, which likely limits the downside over the next week. However, a retest of the 50-dma is certainly not out of the question.

With that said, we are entering into the two weakest trading months of the year. Stocktrader’s Almanac had a good note on why the rally could experience a “pause” over the next two months.

“For the past 33 years from 1988-2020 August and September are the worst two months of the year for DJIA, S&P 500, and NASDAQ. August is the worst for DJIA and S&P 500 and September is worst for NASDAQ.

Despite the persistence and resilience of this bull rally market internals and technicals are showing some signs of fatigue.“

• Advancing issues have barely outpaced decliners in recent weeks.

• New highs have been shrinking while new lows remain high.

• Technical indicators are struggling to break through resistance.

• Relative Strength, Stochastics and MACD are breaking down again.

“The timing of a pause coincides with the weak seasonal patterns mentioned above during the worst months of the year August and September (not to mention Octoberphobia) as well as the 4-Year Presidential Election Cycle.” 

6-Month Advances Are Rare

Given the bullish bias currently remains unfettered, and the Fed is still applying $120 billion a month in liquidity, there is no reason to be overly “bearish” at this juncture. Thus, while we are carrying slightly reduced exposure currently and have increased our “risk hedges” as of late, we remain nearly fully invested.

With our “money flow buy signals” triggered, such suggests there is support for stocks currently. Such means two things over the next week or so: 1) there is not a great deal of downside, and 2) there is not much upside either. Thus, a sideways consolidation and a pickup in volatility are likely. One concern is the “negative divergence” of money flows (bottom panel) against an advancing market. Such corresponds with the technical weakness we will discuss momentarily.

Therefore, given this backdrop, we increased portfolio hedges.

An additional “red flag” is the S&P 500 has had positive returns for 6-straight months. As shown in the 10-year monthly chart below, such streaks are a rarity, and when they do occur, they are usually met by a month, or more, of negative returns.

(It is also worth noting that when the 12-Month RSI is this overbought, larger corrective processes have occurred.)

While prices have advanced sharply, the bullish mantra remains that “earnings” support the increase. While that “rationalization” may seem to have merit, investors are paying more today for the same expected earnings from January of 2020.

The Mirage Of Strong Earnings

The second-quarter earnings season started with a bang, with several companies reporting earnings “knocking the cover off the ball.”

“Overall, 24% of the companies in the S&P 500 have reported earnings to date for the second quarter. Of these companies, 88% have reported actual EPS above the mean EPS estimate. Another 1% have reported actual EPS equal to the mean EPS estimate, and 11% have reported actual EPS below the mean EPS estimate. The percentage of companies reporting EPS above the mean EPS estimate is above the 1-year (83%) average and above the 5-year (75%) average.” – FactSet

It is not surprising that stocks are rallying to new highs again this week with those kinds of numbers.

However, the longer-term problem for investors is that while the earnings were strong, they are only getting back to levels where they were supposed to be at the beginning of 2020. As shown, in January of 2020, the earnings estimate for the end of 2021 was $171/share. Currently, before estimates get downwardly revised, it is presently estimated that earnings will be just $174/share at the end of 2021.

As noted, the problem for investors comes down to valuations. For example, in January of 2020, investors were paying 19x for 2-year forward earnings. Today, they are paying 25x earnings for essentially the same dollar amount of earnings.

While it gets lost in the daily media, the reality is the price of the market is outpacing actual earnings growth. More importantly, when looking back historically, we see that earnings growth isn’t as strong as headlines suggest.

We certainly understand that valuations have very little importance in the short term. For now, all that matters is price momentum. However, as investors, it is essential to remember that valuations have great importance longer-term.

Sales Are Worse

Of course, such doesn’t even come close to premiums paid for each dollar of “actual sales” generated by the underlying companies. As we noted in “Priced For Perfection,” sales will decline this quarter, driving the price-to-sales ratio to historical levels. To wit:

Thought this was interesting.#Earnings are expected to hit $151 #reported this quarter

Q4-2020 = 94.13
Q1-2021 = 128.20
Q2-2021 = 151.17 est.

But here is revenue

Q4-2020 = 367.48
Q1-2021 = 364.05
Q2-2021 = 360.81

Anyone notice an issue relating to #Price/Sales

— Lance Roberts (@LanceRoberts) July 13, 2021

“Investors should not dismiss the above quickly. Revenue is what happens at the top line. Secondly, revenue CAN NOT grow faster than the economy. Such is because revenue comes from consumers, and consumption makes up 70% of the GDP calculation. Earnings, however, are what happens at the bottom line and are subject to accounting gimmicks, wage suppression, buybacks, and other manipulations.“

Currently, the price-to-sales (revenue) ratio is at the highest level ever. As shown, the historical correlation suggests outcomes for investors will not be kind.

Currently, there are more than 70 companies in the S&P 500 trading above 10x sales. That is 14% of the entire index, one of the highest levels ever on record. (How many of these companies do you own?)

A Lesson From 2000

Why is that important? For that answer, let’s revisit what Scott McNealy, then CEO of Sun Microsystems, said in 2000.

“At 10-times revenues, to give you a 10-year payback, I have to pay you 100% of revenues for 10-straight years in dividends. That assumes I can get that by my shareholders. It also assumes I have zero cost of goods sold, which is very hard for a computer company.

That assumes zero expenses, which is hard with 39,000 employees. That assumes I pay no taxes, which is very hard. And that expects you pay no taxes on your dividends, which is kind of illegal. And that assumes with zero R&D for the next 10-years, I can maintain the current revenue run rate.

Now, having done that, would any of you like to buy my stock at $64? Do you realize how ridiculous those underlying assumptions are? You don’t need any transparency. You don’t need any footnotes.

What were you thinking?”

Of course, much of this is “forgotten history,” as many investors today were either a) not alive in 1999 or b) still too young to invest. However, for the newer generation of investors, the lack of “experience” provides no basis for the importance of “valuations” to future outcomes.

That is something only learned through experience.

GDP Eclipses Pre-Pandemic Level

On Thursday, CNBC ran the following headline:

To wit:

“The U.S. economy is now larger than it was before the pandemic, but its growth rate may have peaked this year at a much slower pace than expected.” – Patti Dom, CNBC

Patti is correct; economic growth just peaked.

The problem with the 6.5% annualized rate is it was more than 50% lower than the original estimates of 13.5%. More troubling was the report was even lower than the Atlanta Fed’s much-reduced 7.6% estimate.

What was missed by the mainstream media are two very critical factors.

1. The sharp decline in expected GDP growth rates suggests that “deflationary” pressures are present; and,

2. Given the relationship between economic growth and earnings, current estimates will be revised lower.

Over the next two quarters and fully into 2022, economic growth rates will decline back to 2% or less.

More importantly, the weaker than expected GDP report pushed the Market Capitalization / GDP ratio (inflation-adjusted) to a record high. But, again, given that revenues are a function of consumption (70% of the GDP calculation), earnings growth will weaken by default.

Lastly, while the economy is indeed larger than pre-pandemic, such is of little consolation. When you realize it took $8 Trillion in monetary stimulus (40% of the economy) to create $406 billion in growth from Q1-2020, it is a little underwhelming.

Next year, the fiscal impulse will become a drag.

Such will make it much harder to justify current valuations in a much slower economic growth environment.

Portfolio Update (Party On Garth)

For now, as noted above, the markets remain bullishly biased, and there seems little to derail that mentality currently. The weaker than expected economic growth rate gave the markets reassurance the Fed won’t “taper” anytime soon.

In the meantime, we continue to maintain nearly full equity exposure in our portfolio models. However, the one change we have been quietly making over the last two months is increasing the duration of our bond portfolios. Such is because the recent peak in interest rates is more telling about the economy’s outlook and markets than many would like to admit. (See Why Bonds Aren’t Overvalued.)

While the markets are indeed in “Party On Garth” mode, the current extended, overbought, and bullish conditions provide the necessary backdrop for a short-term correction.

As discussed over the last couple of weeks, August and September tend to be weaker performance months. Therefore, with the bulk of earnings soon behind us, the focus will turn back to the economy and the Fed.

In the near term, the most significant risk for the market comes from the Federal Reserve at the Jackson Hole Summit this summer. If there is a change in their outlook to a more “hawkish” stance or more detailed “taper” discussions, the markets may react negatively.

Another immediate risk could be a failure to pass additional stimulus in Congress or a movement to “lockdowns” due to the virus.

In conclusion, it is simple enough to say “I have no idea” what could derail the markets. Such is why we analyze the risk each week and try to make prudent and informed decisions about portfolio exposures and risk management.

It’s the best we can do for you and our clients.

Have a great weekend.

No more heat wave for the Northeast, at least through the first week of August. 

All the weather data so far point to a very cool start to August compared with seasonal averages. 

The six-to-10 day temperature forecast highlights a cool first week of August for the Northeast. 

The colder weather may linger through the second week of August. 

Temperature anomaly forecast for July 31 through August 7 shows more than half the country may experience temperatures well below their norms from Texas to the Midwest to the Northeast. 

The colder weather may coincide with a dry spell for the Corn Belt to Mid Atlantic to Northeast. Probabilities for precipitation increase for the Pacific Northwest, in desperate need of rain amid wildfires and drought. 

This is a perfect time to open up the windows at night to naturally cool down the house amid an entire summer of scorching heat that has left tens of millions of Americans will high power bills. 

Authored by Paul Joseph Watson via Summit News,

Lockdown advocates who have repeatedly cited rising infection rates as a reason to maintain restrictions are now saying that those same figures are “fishy,” “suspicious,” and unreliable after they started to drop.

Who are the ‘conspiracy theorists’ now?

Reported COVID cases in the UK have dropped by 22% since Thursday last week and cases are falling in every English local authority.

Up until Wednesday, official day to day statistics showed that cases had dropped for seven days in a row, despite restrictions largely being lifted on July 19th.

The fact that the Euro football championships, ‘freedom day’ and the delta variant haven’t combined to create an explosion of new COVID cases seems to have disappointed lockdown advocates like Professor Tim Spector.

According to Spector, who previously called for mask mandates to remain indefinitely, the “sudden drop” in people testing positive for the virus in the government’s data is “very suspicious”.

“It’s dropped something like 30% in two days, which is pretty much unheard of in pandemics, and remember this is happening without restrictions, without lockdowns, without some sudden event,” said Spector.

“To me, it looks a bit fishy. It looks as if there’s some other explanation for this other than suddenly the virus has given up,” he added.

OK, calm down Mr. tin foil hat.

Spector’s rhetoric is particularly funny given that the media has previously demonized anyone who questions official government statistics on COVID infection rates and death tolls as dangerous conspiracy theorists.

Now that the numbers appear to be disproving the argument for lockdown, suddenly those numbers are “suspicious” and unreliable.

As we previously highlighted, Professor Neil Ferguson, the epidemiologist who predicted there would be as many as 200,000 COVID cases a day by this point, was also proven spectacularly wrong yet again.

This also speaks to the fact that lockdown advocates who have built up significant acclaim and media exposure over the last 16 months are seemingly upset that the pandemic might be coming to an end.

Irate Twitter mobs who have repeatedly demanded harsher lockdowns also seem to be genuinely upset when COVID infection rates and death tolls begin to drop.

While all the time grandstanding as “kind” and “compassionate” as they screech at you for “killing granny.”

*  *  *

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Some things simply sound too good to be true, but when money is involved, our judgement can become clouded.

This is often the case with Ponzi schemes, a type of financial fraud that lures investors by promising abnormally high returns. Money brought in by new members is used to pay the scheme’s founders, as well as its earlier investors.

The scheme is named after Charles Ponzi, an Italian who became infamous in the 1920s for claiming he could double his clients’ money within 90 days. Since then, numerous Ponzi schemes have been orchestrated around the globe.

To help you learn more about these sophisticated crimes, Visual Capitalist’s Marcus Lu examines some of the biggest Ponzi schemes in modern history.

 

In many cases, these schemes thrived by taking advantage of the unsuspecting public who often lacked any knowledge of investing. Caritas, for example, was a Ponzi scheme based in Romania that marketed itself as a “self-help game” for the poor.

The scheme was initially very successful, tricking millions of people into making deposits by offering the chance to earn an 800% return after three months. This was not sustainable, and Caritas was eventually unable to distribute further winnings.

Caritas operated for only two years, but its “success” was undeniable. In 1993, it was estimated that a third of the country’s money was circulating through the scheme.

Ponzi Schemes in the 21st Century

The American public has fallen victim to numerous multi-billion dollar Ponzi schemes since the beginning of the 21st century.

Many of these schemes have made major headlines, but much less is said about the thousands of everyday Americans that were left in financial ruin.

For victims of the Madoff Investment Scandal, receiving any form of compensation has been a drawn-out process. In 2018, 10 years after the scheme was uncovered, a court-appointed trustee managed to recover $13 billion by liquidating Madoff’s firm and personal assets.

As NPR reported, investors may recover up to 60 to 70 percent of their initial investment only. For victims who had to delay retirement or drastically alter their lifestyles, this compensation likely provides little solace.

Do the Crime, Pay the Time

Running a Ponzi scheme is likely to land you in jail for a long time, at least in the U.S.

In 2009, for example, 71-year-old Bernie Madoff pled guilty to 11 federal felonies and was sentenced to 150 years in prison. That’s 135 years longer than the average U.S. murder conviction. He died in prison on April 14, 2021.

Outside of the U.S., it’s a much different story. Weaker regulation and enforcement, particularly in developing countries, means a number of schemes are ongoing today.

Sergei Mavrodi, known for running the Russian Ponzi scheme MMM, started a new organization shortly after being released from prison in 2011. Now known as MMM Global, the self-described “social financial network” has established a base in several Southeast Asian and African countries.

Authored by Tilak Doshi via Forbes.com,

The EU published a whole raft of additional climate policies on July 14th with its long-awaited “Fit for 55” package to make Europe carbon neutral by 2050. It included its most contentious plank – the carbon border adjustment mechanism (CBAM).  On July 19th, US Democrat legislators introduced a similar bill to tax imported goods for their carbon content sourced from countries that lack strict environmental policies. Details on the US proposal are scant, with one leading newspaper article stating that the US would “require companies that want to sell steel, iron, and other goods to the United States to pay a price for every ton of carbon dioxide that is emitted during their manufacturing processes. If countries can’t or won’t do that, the United States could impose its own price.”

It would seem that the Nordhaus climate club has become the policy vehicle of choice for advocates of the “climate emergency” on both sides of the Atlantic.

Why The Climate Club

On the face of it, the climate club’s logic is straightforward enough. It is to replace the earlier flawed architectures of the Kyoto Protocol (1997) and the Paris Agreement (2015) which were voluntary international agreements to reduce carbon emissions. To mitigate the problem of ‘free riders’ that inevitably emerge with such agreements, the climate club would establish  an incentive structure that penalized nations that did not play by the rules.

The EU and the US want to impose trade tariffs to bring the cost of carbon-dioxide emissions caused by the manufacture of an imported good into alignment with what a domestic producer would pay to produce the same good. European and American companies are less competitive because they have to pay for their emissions while foreign companies that export to them don’t. Thus rules to reduce emissions will encourage companies in the West to “offshore” their production to developing countries which have less onerous restrictions on emissions, a process known as “carbon leakage”. Brussels and Washington, it is claimed, merely intend to “level the playing field”. Of course the question arises, whose playing field?

The European Commission will initially apply the CBAM to imports from energy intensive sectors including iron and steel, aluminium, cement, fertilisers and electricity, coming into force from January 2026. An analysis by a bank found that Russia, Turkey, Ukraine, India and China will be amongst the most impacted by the CBAM. The complexity of the Brussels-concocted plan ensures that exporters to the EU will have their work cut out for them. Exporting firms will have to document detailed carbon audits on their emissions which would include calculating the percentage of emissions that are already covered by carbon taxes elsewhere (domestic and for imports which go into manufacturing the exports). If these complex and expensive analyses are beyond the compliance capabilities of firms, especially for small and medium-sized businesses, the EC will unilaterally establish carbon tariffs on the basis of the dirtiest 10% of European producers of the same good.

The Climate Club’s Detractors

On July 26th, China opened its first defensive salvo against the EU’s plan to impose the world’s first carbon border tax, stating that it intruded climate issues into international trading norms, broke WTO rules and undermined prospects for economic growth. Earlier in April when it became apparent that both the EU and the US Biden administration were considering extra-territorial and unilateral policies to enforce upon the world their own predilections to “fight climate change”, India also adopted a position similar to China’s. It issued a joint statement with the BASIC bloc — Brazil, South Africa, India and China — calling CBAM “discriminatory“ and expressing its “ grave concern”.

Detractors of the climate club – a club which threatens to be both exclusive and punitive for non-members — point out that carbon border taxes are contrary to the UN climate body’s Article 4. This refers to “Common but Differentiated Responsibilities and Respective Capabilities”, an established feature of climate change negotiations since the UN’s first Rio Earth Summit in 1992.

Last week, at the G20 on climate change and energy, India cited this long-standing equitable principle in countering the “net zero by 2050” target backed by the EU, US, the UN climate body and other rich country-dominated multilateral agencies such as the IEA, the World Bank and the IMF. India’s environment minister Bhupender Yadav said that “…given the legitimate need of developing countries to grow, we urge G20 countries to commit to bring down per capita emissions to global average by 2030”.

While the global average is 6.5 tons per capita of CO2-equivalent, India emits just below 2 tons while the US emits 17.6 tons and Germany 10.4 tons. India asserted that as the rich countries have already “consumed” most of the available “carbon space” in the atmospheric sink since the Industrial Revolution, the “net zero by 2050” target is inadequate.  

The detractors are not limited to developing countries. Australia’s Prime Minister Scott Morrison called the proposed carbon tariff plan “trade protection by another name”. Russia, like China, sees the CBAM as running foul of WTO rules and had already made clear its views a year ago when the EU was mooting its Green Deal plans which included carbon tariffs.

Problems With The Climate Club

Apart from the UN climate body’s Article 4, there are areas in which the proposed carbon tariffs may conflict with WTO trading rules. They may be found to contravene the WTO’s rule of non‐discrimination, a mainstay of international trading norms which requires that any advantage granted to the imported products of one WTO member must be accorded immediately and unconditionally to like products originating from all other WTO members. Carbon tariffs could also be inconsistent with the WTO’s ‘ national treatment rule’, another foundation stone of modern international trade under the WTO regime which requires that imported products be given “no less favourable” treatment than that given to like domestic products. If European producers continue to receive free emissions allowances (as they do now under the EU’s Emission Trading System), then the EU will be found in violation of the “national treatment” rule.

It would seem that the putative rich-country climate club members are headed for an impasse with the rest of the world in the rules of international trade that have broadly prevailed since the Second World War. On the one hand, we have somewhat less that 20% of the world’s population represented by policy elites that are convinced that the “science is settled” and a “climate crisis” is upon us. On the other, we have the vast majority of the world’s population – over 6 billion — newly emerged from wretched poverty in recent decades or desperately trying to. For those beginning to enjoy — or at least having a fighting chance to taste — the fruits of economic growth and technological progress across Asia, Africa and Latin America, their worries are less to do with concerns of the carbon footprint of economic growth as much as ensuring that economic growth will re-emerge after the devastation brought on by the Covid pandemic lockdowns.

Democracy Prevails

But there is a final twist. The Western policy elites, convinced by climate models that purportedly predict dire climate conditions decades into the future, seem to be facing the constraints of democracy in their own backyards. After Switzerland dropped its negotiations with the EU, the country rejected a climate-protection law in a referendum last month. The referendum rejected all three parts of the law in separate votes: on CO2, on pesticides, and on drinking water. Two days ago, UK’s Prime Minister Boris Johnson, facing an increasing backlash from constituents over soaring heating costs with his plans to ban gas boilers in British homes in favour of expensive new-fangled heat pumps, delayed his government’s plans by 5 years to 2040.

For Europe, the greatest lesson of mass politics against climate change polices supported by metropolitan elites was the gilet jaune protests that was triggered by fuel taxes. As one acute observer put it, “The French love a good riot, but the political backlash to the French government’s plans to increase carbon taxes on fuel could be a harbinger of what’s to come in countries committed to the global warming crusade”. 

It is no surprise then that a senior economist at Deutsche Bank, one of Europe’s largest banks, warned that for the EU’s Green Deal to succeed, “a certain degree of eco-dictatorship will be necessary”.

The climate club’s detractors have the tide of history on their side.

Wildfires have been ravaging Turkey’s Mediterranean coast for the past few days, killing four, burning thousands of building structures, and affecting more than a dozen provinces. 

Turkish presidential spokesman Ibrahim Kalin called the wildfires a national disaster.

According to Reuters, at least 60 wildfires have broken out across the country’s Mediterranean and southern Aegean region. 

Forestry Minister Pakdemirli said 4,000 firefighters, 680 firefighting vehicles, 38 helicopters, nine drones, and three planes battle the wildfires. 

“We were hoping to contain some of the fires as of this morning but while we say cautiously that they are improving, we still cannot say they are under control,” Pakdemirli said.

DW correspondent Julia Hahn tweeted scenes from Manavgat in Antalya province showing “apocalyptic scenes” of one wildfire. 

Apocalyptic scenes from #Manavgat in Antalya province where forest fires have killed at least three people since yesterday, and send over 50 others to the hospital. Many neighborhoods, villages evacuated.
Authorities have reported more than 40 wildfires in 13 Turkish provinces. https://t.co/ct8Xx9Hsxo

— Julia Hahn (@juliahahntv) July 29, 2021

Social media is full of horrifying videos of the wildfires. 

Wildfire in Turkey. The planet is on fire #Turkey #UprootTheSystem pic.twitter.com/6bXmO9bf9x

— Rise up Movement (@Riseupmovt) July 30, 2021

Extreme summer wildfires are burning forests and mountains in several cities, including #Antalya and #Adana in #Turkey.🇹🇷#PrayForTurkey #Turkeyisburning pic.twitter.com/4DAwkfLt4e

— khudro manush (@KhudroM) July 30, 2021

🇹🇷⚡ Wildfires in southern turkey#Turkey pic.twitter.com/91e8GqTiUe

— The RAGEX (@theragex) July 29, 2021

⚠️SAD BREAKING NEWS, PLEASE SHARE AND JOIN US IN PRAYING FOR TURKEY!⚠️•Nearly 60 raging wildfires have broken out in Southern Turkey as temperatures have soared and strong winds stoked the flames the past 2 days, killing at least 4 people along with 1,000+farm animals..#Turkey pic.twitter.com/sIc5Gp4mxM

— AFTAB SHAIKH (@aftabshaikh9065) July 30, 2021

Senior scientist of Copernicus Atmosphere Monitoring Service Mark Parrington used satellite data to determine the “deadly scale” of the wildfires and shows which coastal areas are most affected. 

Another view of the wildfires from space. 

There’s still no word how the destructive fires began, but one government says “sabotage” cannot be ruled out. 

Fahrettin Altun, the Turkish presidential communications director, said “comprehensive investigations” are being launched into the origins of the wildfires. 

“Those responsible will have to account for the attacks against nature and forests,” Altun tweeted.

Turkey has been plagued with a heat wave like much of southeast Europe. 

In neighboring Greece, authorities warned the public against the heightened risk of wildfires during the latest heat wave. 

“A difficult weather phenomenon is coming in the next days with extremely high temperatures and several days of heat wave,” Citizens’ Protection Minister Michalis Chrysochoidis said. “I call on – I urge – everyone to show the highest degree of responsibility and cooperation.”

This summer has been absolute chaos across the world, heat waves in the US and Europe, cold snaps in South America, and floods in Europe and China, give climate alarmist Greta Thunberg ammunition to tweet climate disaster propaganda of how the world is ending unless governments act now.

Authored by Paul Joseph Watson via Summit News,

A video out of the UK shows NHS nurses demanding to COVID test a newborn baby, claiming it’s not the mother’s property once outside the womb and then threatening to report her to social services for refusing.

The shocking video, which was posted to Twitter, shows a heavily pregnant mother in a hospital bed being lectured by nurses about how it’s mandatory for the baby to be given a COVID test immediately after birth.

“It is my property,” states the mother, to which one of the nurses responds, “so you will…while the baby’s in your abdomen.”

“So you’re saying once the baby comes out it’s not my property no more, yes it is, I gave birth to it, it’s got my blood running through it,” the mother asserts.

The nurse then continued to insist she “explain” why the baby needs a COVID test, which only serves to stress out the pregnant woman.

VIDEO.

NHS Nurses tell high risk expectant mother that they WILL be P C R Testing the baby once born, that the baby isn’t “The mothers property” once out of the abdomen & that the Safeguarding team (Social Services) are being notified because of their refusal.

Heroes folks …. pic.twitter.com/oPSVuWiGRo

— Dissent Media (Official Account) ♿ (@DisabledJourno) July 28, 2021

“Do you really think I need this bullshit about COVID when I’ve got a risk of losing my baby?” the woman asks.

The father of the baby then suggests the pair leave the hospital, stating, “They’re not COVID testing my baby – end of.”

“You can’t tell me that you get to give me the say of what happens once my baby’s born – I don’t think so, you can’t do nothing to my baby without my permission,” says the mother.

The nurse then responds by saying the mother’s refusal to have her baby COVID tested will be documented and passed on to social services (the Safeguarding team), essentially meaning that the mother will be investigated for neglect and possibly face authorities trying to remove the baby from her care.

“You’re so good aren’t you, you people?” the mother sardonically states at the end of the clip, perhaps in reference to how nurses in the UK have been deified as a result of the pandemic, with people at one point being asked to participate in weekly applause sessions to show gratitude to the NHS.

*  *  *

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Authored by Kurt Schlichter, op-ed via Townhall.com,

Everybody wrap something around your face again even though they said you wouldn’t need to if you got vaxxed! But they didn’t lie – no, apparently a bunch of people – and not just those evil white nationalist-Christian-gun-Jesus-flag people – are refusing to get the vaccine, and the reason is that they are moral defectives somehow in thrall to Tucker Carlson’s Svengali-like powers of persuasion.

You see, the people who won’t get it are stupid people who hate science because they refuse to trust the people who have spent the last year-and-a-half lying to them.

I don’t blame those folks a bit. 

Let’s try a thought experiment. Let’s imagine our ruling class was not as utterly corrupt, dishonest, incompetent and downright stupid as it manifestly is. I know that’s hard, but go with me.

This weird new virus appears and starts spreading. Instead of leveraging it to take down Trump, the Democrats appear with the Republican president and GOP leadership to announce they are working together to solve the problem. Imagine that instead of shaming people, first about wearing masks, then about not wearing masks, then about not wearing two masks, then no masks, then masks again, they went with transparency. 

“We are not sure how much, if at all, masks work. We’re running test trials to see and we’ll tell you what we find as soon as we have the data. In the meantime, let’s all wear them just in case.” And then, when they ran the studies, they would tell us the answer. 

Have you seen any studies about masks? We get a lot of that fascist gnome and others telling us to wear masks (after initially telling us they were useless – remember that memory-holed narrative?) but where’s the actual science?

See, you have to believe the science, and believe them when they tell you what it is yet won’t show you. Obey!

But trust is earned, and these people act like it is their right to have our trust, that we owe them to take it on faith that whatever these people say is the Gospel. Except they are wrong all the time, and instead of owning up to it, they treat you like some sort of idiot for noticing. When you don’t trust people who are perpetually wrong, that’s not denying science. That is science – you are making observations, and drawing reasonable conclusions. In this case, the observation is that our establishment sucks, and that it can’t be trusted.

How far would a little humility gone? Very far. Imagine, and this will be hard, these masterminds getting up and saying,

“America, we were wrong about something. We thought it was right, but we tested it and we found we were not right. Here is the data, and now that we have better information, we are changing our recommendation.”

What would we say?

“Oh, okay. They were doing the best they can and being straight with us. People make mistakes. We need to learn from them. After all, it’s been a century since the last pandemic so we have a lot of lessons to re-learn. Let’s move forward.”

But no. No, there’s no humility. They make a mistake and they don’t stand up and admit it. Instead, they just change the narrative and act as if the narrative du jour was always the narrative. Oceania has always been at war with Eastasia. But we’re not blind or stupid for noticing.

They tell us the vaccine is going to make us immune from COVID. Then it turns out you can still get it, just not as bad. Yet when people notice this 180-degree spin, the smart set shrieks like Donald Sutherland at the end of Invasion of the Body Snatchers.

Just imagine if they had been honest and forthright. But that was not in the cards. The ruling caste’s conceit is that we are idiots, unable and unworthy to make simple decisions for ourselves. We must be guided, nudged, or intimidated, if necessary, into making the right choice. And we do not deserve explanations, because the last thing our elite wants is accountability. 

Instead, they want unlimited power. Look at their arbitrary emergency rules and regulations. You could go to a strip club but not a church. Huh? And the courts, again, let us down initially by not enforcing the Constitution. It was an emergency, after all, and as we all know, in an emergency you need to rule by decree, say our betters. So, we got to watch idiots walking around in the sunshine with mouth thongs on while cops busted mommies for letting little Billy play on the slide. At no time did most of the establishment reconsider or change. No, it doubled down on failure. Yet we’re supposed to trust it?

And then there are the revelations about where it came from. They first blamed the innocent pangolin. But it looks like it was our elite’s buddies the Chi Coms, except when people raised that notion earlier, they got banned by social media. Our establishment limited our ability to speak about something true. Think about that. And they want to do it again.

And that’s where the vaccine hesitancy comes in. The smart set squanders its trust then is shocked to find that its trust has been squandered. People are seeing side effects from the vaccine. Those were always going to happen. But our elite is unwilling to level with people about them and let individuals manage their own risks. Instead, our garbage elite dismisses people with questions as “anti-vaxxers” instead of engaging with them and earning their trust. See, we peasants are unworthy of engagement. How dare we seek to choose for ourselves? The nerve of us serfs!

I got the vaccine. I also had the disease. I talked to conservative doctors I trusted about my unique situation and made my decision. You should do the same – you know your situation, and you should balance the risks. I don’t tell other people what to do because it’s not my business and I don’t know their story. I’ve had people get on me for mine, and they need to back off – they don’t know my situation and it’s none of their business. Similarly, theirs is none of mine.

The establishment has squandered its credibility, which is why its demand that everyone take the shot is getting shriller and the attempts to force people more punitive. Imagine if they had been honest from the beginning. Imagine if they had been held accountable. But to do that, you have to imagine having a ruling class that doesn’t suck. And that’s more imagination than anyone can muster.