Category: zerohedge

Police in the Sacramento, California suburb of Citrus Heights are investigating a string of arsons targeting homes displaying the American flag.

According to CBS13, at least four homes were targeted in the Sungarden neighborhood Saturday morning.

A charred pole is all that’s left of the American Flag that had been flying outside Marie Nuzzi’s home.

“If it had burned longer it would have caught the house on fire,” Nuzzi said. “Somebody’s lives, for what?”

The fire was set at about 3 a.m. Saturday morning and burnt out before reaching the house where Nuzzi and three other family members were sleeping inside.

“It was a nylon flag, so it’s just all this black soot is just on the concrete,” Nuzzi said. –CBS13

Down the street from Nuzzi, arsonists set trees on fire at another home which had smaller American flags on display around the front lawn, while at least two other American flags were set ablaze. 

Local resident Michael Howard, who helped clean up the ashes, says he’s never seen this type of crime in his 10 years in the neighborhood.

“This is the first time anything’s happened,” he said. “Gut reaction? Is it somebody with an agenda?”

Police are investigating whether the arsons are tied to the nationwide protests over the killing of George Floyd, a black man who died after a white Minneapolis police officer knelt on his neck for over eight minutes as onlookers begged him to stop.

Nuzzi isn’t so sure.

“I really don’t want to think like that, I really don’t,” she said, adding “I just think it was kind of a random thing.”

Police are asking for the public’s help with any surveillance footage from ring doorbells or other cameras which may have recorded the suspects around 3 a.m. on Saturday.

Meanwhile in Fremont, California, a person in a Honda Civic was seen jumping out and burning an American flag before fleeing the scene.

PREDAWN ARSON: Recognize this Honda Civic? Someone jumped out, burned an American flag & fled,per @FremontPD. VIDEO: https://t.co/0SfP1I1Khm pic.twitter.com/NMrXDzJZAM

— Henry K. Lee (@henrykleeKTVU) July 20, 2017

ViaAlmasdarNews.com

Syria criticized the statements of the American envoy, James Jeffrey, about the current situation in Syria, stressing that it affirms that the United States is looking at the region with “Israeli eyes”, and it also represents a recognition by Washington of its responsibility for the suffering of the Syrian people.

An official source in the Syrian Ministry of Foreign Affairs told state-owned SANA, “The intensification of sanctions is the other side of the declared war on Syria after the aggressive project staggered in the face of successive defeats of its tools from terrorist groups,” according to the Syrian News Agency.

The source said, “These statements confirm once again that the United States is looking at the region with Israeli eyes, because the demands that Jeffrey talks about are old and renewed Israeli demands to impose their control on the region.”

He continued: “This American policy, which constitutes a flagrant violation of the most basic human rights and international humanitarian law, will fail again in the face of the Syrians insistence to adhere to the sovereignty of their homeland and the independence of their political and economic options.”

The U.S. envoy to Syria, James Jeffrey, said in a video interview with a number of Syrians abroad two days ago that the U.S. sanctions against Damascus “contributed to the collapse of the value of the Syrian pound” and that “the Syrian regime is no longer able to manage an effective economic policy, or launder money from Lebanese banks, due to the economic crisis that is also affecting Lebanon.”

For years just prior to the outbreak of the war beginning in 2011 50 Syrian Pounds equaled $1…

Syrian pound exchange reaches 3500 SYL against US dollar.

Syria’s inflation rate is about 11.5% per month. It’s generally considered that hyperinflation sets in around 50% per month, when currency can no longer be used as a store of value.https://t.co/M60vrSfFt2 https://t.co/ZGUw9SDw29

— Joshua Landis (@joshua_landis) June 8, 2020

He added that “the U.S. Congress stood behind (Caesar’s law), and that the sanctions covered by the law to protect Syrian civilians, will automatically affect any economic activity, as well as any dealings with the Iranian regime.”

The U.S. administration recently approved the “Caesar Law” which comes into effect this month.

The Caesar Law, in addition to the Syrian government, targets all individuals and companies who provide funding or assistance to Syria, as well as a number of Syrian industries, including those related to infrastructure, military maintenance, and energy production.

James Jeffrey, the #US envoy for #Syria, admitted that the high prices of basic products in Syria and the devaluation of the Syrian pound are due to measures approved by his administration.

They seem to really enjoy watching Syrians starve to death. F*cking maniacs 😡 pic.twitter.com/wZfEJFfSxj

— Saimah Abdelnour (@AbdelnourSaimah) June 8, 2020

In this context, Jeffrey indicated that his country had presented Syrian President Bashar al-Assad with a way out of this crisis, and that if he was “interested in his people, he would accept the offer. Washington wants to see a political process and it may not lead to a regime change.”

Jeffrey boasted of US sanctions as the population suffers for extreme lack of resources and basic staples:

“Do sanctions work?… But as we see with the total freefall of the Syrian pound right now and other indicators – shortages of gas and other fuels – the Assad regime is under tremendous economic pressure...”

Kuwaiti newspaper Al-Qabas revealed Jeffrey’s offer, noting that “it requires going to a political solution to implement Security Council Resolution 2254 and the cision, and ompletion of a new constitution and holding elections under U.N. supervision after achieving a safe and neutral environment and acceptance of international decisions,” stressing that Washington’s offer is Assad’s commitment to the “Geneva 1” statement, which he says is not possible to stay in power.

Senior editor Ash Bennington joins managing editor Ed Harrison to discuss market sentiment in light of NBER’s recent announcement that the U.S. slid into recession in February. Bennington and Harrison explore whether market participants are betting that liquidity will mitigate the credit cycle’s severity and whether this could be a miscalculation that catches investors off guard, leading to a “double-dip” recession. They also draw comparisons between today’s markets to that of the dot-com era, highlight the shift toward momentum trading, and share their thoughts on how durable damage to demand can bring an unnaturally elevated market crashing down later in the year. In the intro, Peter Cooper explains the surge in new online brokerage accounts and explores particular instances of excess speculation by retail investors.

For the first time in decades since the issue was initially raised by the NAACP and other groups, the Pentagon says it’s now “open” to considering renaming all Army bases named after Confederate generals and leaders, after pressure coming from activists and civil rights groups amid George Floyd and ‘Black Lives Matter’ protests gripping the nation for the past two weeks.

This includes the sprawling Fort Hood base in Texas, named after Confederate General John Bell Hood, as well as nine other Army posts, especially Fort Lee Army Base in Virginia, named for top Confederate general Robert E. Lee.

No less than Secretary of Defense Mark Esper and Secretary of the Army Ryan McCarthy signaled early this week they are “open to a bi-partisan discussion on the topic,” according to an official Army statement.

This shift in even considering the possibility was also reportedly triggered by The Marine Corps recently decreeing a ban on all displays of Confederate symbols, such as the Confederate battle flag, including even on individual personnel’s vehicles. The order even goes down to banning depictions of Confederate symbols on bumper stickers, mugs, or T-shirts and posters.

“The Confederate battle flag has all too often been co-opted by violent extremist and racist groups whose divisive beliefs have no place in our Corps,” the Marine Corps said in a statement.

Naturally, those advocating for the erasure of anything related to this era of American history and the Confederacy are pushing for more, even the names of major US bases. 

Here are ten base names that would be on the chopping block if the Department of Defense actually went through with the renaming: 

• Fort Benning in Georgia
• Fort Bragg in North Carolina
• Fort Hood in Texas
• Fort Lee in Virginia
• Fort Polk in Louisiana
• Fort Gordon in Georgia
• Fort Pickett in Virgina
• Fort A.P. Hill in Virginia
• Fort Rucker in Alabama
• Camp Beauregard in Louisiana 

But we ask: where does this attempted ‘purging’ of America’s past and historical memory end? 

How long till even the Washington monument or Jefferson Memorial are targeted? Will even Monticello be taken apart brick by brick? 

Certainly those now defacing buildings and monuments amid the protests of the past two weeks will not stop advocating for the erasure of all American history. 

Authored by Ron Paul via The Ron Paul Institute for Peace & Prosperity,

It seems like only yesterday. Americans were denied the right to go to their churches. They were denied the right to visit their loved ones in the hospital. They were denied the right to open their businesses and go to work to provide for themselves and their families. They were denied the right to go to restaurants, to bars, to hair salons.

No laws were passed denying these rights. Even that would be illegal and immoral. But what happened was worse. They were denied these basic rights by governors, county judges, and even local mayors who used the coronavirus outbreak as an excuse to rule by decree. They stole power that was not theirs to take and wielded it at all levels to force America into three months of house arrest.

Then, in the midst of stay-at-home orders across the country, the same governors and local officials who locked Americans in their homes suddenly came around with their keys and threw open the doors.

Suddenly not only was it OK to go out into the street, it was required to go out into the street!

What happened? A cure? A miraculous vaccine?

No. The officials who locked Americans up found a cause they felt required Americans in the streets to protest. Police had killed a black man, George Floyd, in their custody in Minneapolis and suddenly the need to protest trumped the need to “stay home, save lives.”Suddenly the same health “experts” who told us we must not gather in crowds or there will be death in the millions from coronavirus issued statements supporting gathering in crowds. An open letter on the George Floyd protests signed by more than 1,200 doctors and other health professionals clarified that they “do not condemn these gatherings as risky for Covid-19 transmission.” However, they wrote, “this should not be confused with a permissive stance on all gatherings, particularly protests against stay-at-home orders.”

Did the coronavirus develop some kind of superior intelligence enabling it to distinguish between those who were congregating for a “good cause” and those who were congregating for a “bad cause”? Of course not. What has happened from the beginning of this shameful coronavirus episode is the politicization of public health at the hands of authoritarians.

Two prestigious medical journals, The Lancet and the New England Journal of Medicine, were forced to retract studies they had published concluding that Hydroxychloroquine was harmful to Covid patients. The rush to print the studies looks very much like a political move rather than one based on scientific principles. Once President Trump revealed that he was taking hydroxychloroquine the mainstream media and even “expert” journals began attacking the drug.

This is what happens when medicine merges with the state. We get the worst of both. We get career bureaucrat Dr. Fauci telling us we can never shake hands again and that we must stay home until a vaccine is found. Meanwhile, doctors across the globe are reporting that this variation of the coronavirus is disappearing on its own.

We have a tradition of separation of church and state in the United States for good reason. The merger of state and church invites oppression and corruption. We need to adopt this same approach to medicine and the state. We now see how this merger has produced the same kind of widespread tyranny and corruption.

The one discussion bulls chose to ignore while equity markets soar to new highs is the permanent economic damage story due to months of coronavirus lockdowns. A new report shows tens of thousands of brick and mortar shops could close their doors this year, which would indicate the “retail apocalypse” is accelerating. 

The report, commissioned by Coresight Research, forecasts that in 2020, upwards of 25,000 retailers could shutter operations after months of lockdowns decimated mall traffic — collapsing store sales and resulting in delinquent rent payments.  

Even before the pandemic, we noted the “retail apocalypse was particularly bad in 2019,” with about 10,000 stores closed for good. Most of the closures were mall-based retailers as consumerism and spending shifted online. Lockdowns, in the last few months, accelerated the shift to buying items online while strict social distancing rules enforced by the government led to non-essential shop closures. 

Coresight CEO Deborah Weinswig wrote in the report, a closure wave of “anchor tenants” in shopping malls will lead to surrounding shops closing up as well. She said if that happens, her firm would then expect 20,000 to 25,000 shops to close by year-end.

“Department and large apparel-chain store closures in malls will, therefore, create a ripple effect that spells bad news for malls,” Weinswig said. 

In early June, Simon Property Group, one of the largest mall operators in the US, sued GAP, it’s the largest tenant, claiming the retailer failed to pay more than $65.9 million in rent and other charges during shutdowns. 

The lawsuit “highlights the mounting tension between retail landlords and their tenants, many of which stopped paying rent after the crisis forced them to shut stores,” CNBC noted. 

So far, US retailers have planned about 4,000 permanent store closures, with hundreds from Pier 1 Imports, Neiman Marcus, Tuesday Morning, JC Penney, Stage Stores, and L. Brands. Before the virus outbreak, Coresight was already forecasting 15,000 stores would close this year. 

Store closures this year have already triggered an unprecedented implosion in US commercial real estate. The latest remittance data by Trepp shows a massive surge in newly delinquent CMBS loans. 

“CMBS Delinquency Rate registered at 2.29% in April, in May the Delinquency Rate logged its largest increase in the history of this metric since 2009. The May reading was 7.15%, a jump of 481 basis points over the April number. Almost 5% of that number is represented by loans in the 30-day delinquent bucket,” we said last week. 

As stores close up shop, jobs are also lost, which we recently noted, 18 million workers could be at risk of permanent job loss. 

And if you’re curious to learn just how big the impending commercial real estate bust will be, your questions will be answered in “Sizing The Commercial Real Estate Bust.” 

Over the past few months, a lot of attention has fallen on retail investors who at times appear to have taken over the market, as institutional investors have been slow in jumping in on the “hated” rebound from the March 23 lows, with many commentators lumping all retail investors in the same bucket.

However, as Goldman’s Tony Pasquariello points out, within the retail cohort there is a clear demographic divide: “the Boomers are selling equity mutual funds and ETFs every single week … that totals $73bn of YTD outflows. In stark contrast, the younger investor base is very active in single stocks … in many regards, retail traders today are as active as they’ve been at any point since ‘99/’00.”

Why the variation? A somewhat amusing summary of investment “fundamentals” was provided by @Keubiko today who summarized the key investment terms of the 1950-2019 period vs 2020 as follows:

1950-2019:

2020:

Joking (maybe) aside, DataTrek’s Jessica Rabe shares a somewhat more more take in answering the question whether millennials will fundamentally alter US societal capital allocation in favor of their personal values rather than simply maximizing returns, with the COVID-19 Crisis providing a useful case study into how this cohort invested as markets swooned.

Here is what Rabe found:

We use data from Robintrack, which tallies the number of accounts that hold specific stocks at no-fee trading app Robinhood, well known for its predominantly millennial user base. The app, already popular with this group, saw a flood of investor interest during the recent volatility and added +3 million funded accounts this year as of early May, half of which the company reported were first-time investors.
While the common narrative suggests millennials will invest differently than their baby boomer parents, here’s what the data actually shows:

#1: If most millennials invested based on their environmental beliefs, Ford would not be the top position among Robinhood users as it is today. In fact, 3.5x more accounts hold F – which makes its profits by selling polluting pickup trucks – as they do clean-energy electric car-maker Tesla. Yes, we understand Ford is trying to move to an eco-friendly future but it certainly is not there yet. Not even close…

Moreover, the top 20 most-held names at Robinhood include major airlines, such as American Airlines (#3), Delta (#4) and United Airlines (#12). Jet engine manufacturer GE is the second most held stock, and airplane manufacturer Boeing comes in 13th. As with Ford, an odd choice for a demographic cohort keenly aware of the environmental damage caused by high-altitude carbon emissions.

Our take: the lack of environmental, social and governance (ESG) friendly names at the top of the Robinhood leaderboard contrasts with the notion that millennials will only back companies that align with those characteristics. For example, the number of accounts that invested in Ford has doubled since mid-March, while those for AAL, DAL and UAL grew by 8.7x, 9.7x and 14.2x respectively.

“Big Tech” companies are also among the top held positions despite having well-known social (i.e. diversity, political issues, etc.) and governance (i.e. monopolistic) problems: Microsoft (#9), Apple (#10), Uber (#24), Twitter (#26), Facebook (#30), and Amazon (#31). In fact, the largest ESG ETF (iShares ESG MSCI USA ETF or ESGU) is currently ranked 4,147th on the Robinhood leaderboard, despite receiving significant inflows overall this year. Just 300 accounts hold ESGU on the online broker versus +890k for Ford.

#2: Millennials followed the age-old maxim to “buy low, sell high” by purchasing beaten down stocks over the last few months. Ford is a good example because its chart closely mirrors the rest of the 20 top held names on Robinhood. As Ford’s price started to crater heading into and during the pandemic, the number of users holding F jumped when shutdowns began in mid-March. They were up +44% from March 15th through March 31st (the low in its stock price was on March 23rd), and have consistently grown from there (doubled since March 15th to +890k accounts). The stock price is also up almost double (+88%) since the low in March.

Other 20 top held names that took a big hit from the virus include cruise line stocks: Carnival Corp (now #6 on the Robinhood leaderboard), Norwegian Cruise Line (#11) and Royal Caribbean (#20).

Our take: millennials showed strong conviction in names with uncertain outlooks even as older institutional investors sounded the alarm.

#3: Millennials tend to invest in companies they believe in or feel they understand. This includes:

• Brand names: Ford and GE (#1 & #2 on the list), Disney (#5), Bank of America (#15)
• Tech: GoPro (#7), Microsoft (#9), Apple (#10), Fitbit (#14), Snap (#17)
• Public marijuana stocks: Aurora Cannabis (#8) and Canopy Growth (#19)

Our take: millennials bought what they know, not dissimilar to baby boomer retail investors in the 1980s and 1990s (think Peter Lynch). Millennials grew up using technology (i.e. MSFT programs, AAPL products, social media platforms like Snapchat) and with the brand names listed (i.e. Ford cars, trips to Disney or the bank). They’re also the cohort most in-favor of legalizing recreational marijuana.

In sum, the portion of millennials that took control of their finances when stocks were falling apart did not invest more “ESG” minded than their parents. No doubt millennials care about the environment and other social issues, but they still invest just like prior generations.

* * *

We leave the last word to Bleakley Financial Group’s Peter Boockvar: “It’s great that Vegas is open again, but who needs it when you have the stock market instead. After an incredible run since March, we now have clear froth in parts of the market. We know this level of speculation has coincided with a sharp increase in the activity of retail investors.”

After liberal leaders and their trusted science community warned of mass COVID-19 deaths without drastic and lasting lockdowns, millions of activists around the world paid exactly zero attention to said warnings – gathering in tightly-packed crowds to protest the killing of George Floyd.

Now, a Seattle researcher behind early genomic analysis of the coronavirus says that daily deaths in the United States could more than double – adding between 200 and 900 deaths per day for each day of protests involving at least 600,000 people, according to Hot Air.

Trevor Bedford is the Seattle researcher who used genomic analysis early on in the pandemic to detect hidden community spread in Seattle, the first big clue that America had a more significant COVID-19 problem than it realized. He’s watching the mass demonstrations against police brutality this week with growing concern, knowing that from an epidemiological standpoint the “mass” part is all that matters. The virus won’t make exceptions in the name of progress. –Hot Air

These infections will percolate through the community and be realized over the coming weeks. Assuming an IFR of between 0.5% and 1%, we would expect these ~54k infections to result in 270-540 eventual deaths per day of protests. 7/12

— Trevor Bedford (@trvrb) June 7, 2020

My (updated) best guess is that each day of protests involving 600k people will result in between 200 and 1100 eventual deaths. 9/12

— Trevor Bedford (@trvrb) June 7, 2020

Meanwhile, as Hot Air‘s Allahpundit notes, from the Floyd protests, to Las Vegas, to the rest of the country reopening, there isn’t a lot of social distancing or mask-wearing going on.

Las Vegas is officially back. pic.twitter.com/EI3nXs2e5w

— Arash Markazi (@ArashMarkazi) June 6, 2020

The Vegas clip shocked me more than the protest clips did because of how normally everyone is behaving. Mass demonstrations are many things but “normal” isn’t one; the Vegas footage looks like it came from an alternate dimension in which there’s no coronavirus, though, with a few stray masks being worn by gamblers the only hint of a lurking threat. Most Americans aren’t behaving that recklessly — majorities still say they’d be “somewhat uncomfortable” eating at a restaurant or attending a public gathering — but the backsliding on social distancing has clearly begun. –Hot Air

Read the rest of the report here.

Authored by Charles Hugh Smith via OfTwoMinds blog,

Come on, Jay, you can always goose stocks back to new highs after the election.

Indulge me for a moment in some backroom speculation. It’s absurdly obvious that the unelected, permanent, ever-expanding National Security State, a.k.a the Deep State, and its Democratic Party allies have been attempting to torpedo Donald Trump since the 2016 election took them by surprise. (Imagine doing everything that worked so well in the past and failing at the last minute. Ouch. Revenge is best served cold, n’est pas?)

The comedy-of-errors RussiaGate collapsed in a foul heap, the impeachment backfired, and so what’s left in the Deep State quiver other than its usual bag of, ahem, accidents?

Some might argue that urban riots and civil unrest might be enough to cause Trump to lose the election in November, but this strategy can backfire just as easily as the previous Deep State strategies.

Assuming Americans will ultimately vote their pocketbook as in the past, the only sure way to sink Trump is to crash the stock market, the jewel in Trump’s crown. This is blinding obvious, but the Deep State’s political allies have been wary of shrinking the bloated wealth of their donors, and wary of a backlash from the wealthy who want to see Trump lose but not if it requires the personal sacrifice of surrendering any of the $548 billion they’ve gained in the recent stock market melt-up.

But with the election just months away, the pressure is now so intense that the Deep State is demanding Powell and the Fed stop the money-printing that’s goosing stocks higher. Hints have been elevated to suggestions which are about to become demands.

Jay, we’re sure you understand the importance of this election for the country, and so you’ll understand why we need to see new lows in the stock market by September, October at the latest. Can you do your duty, or do we need to find someone else willing to serve the national interest at this critical time?

The Deep State has tapped Powell on the shoulder, and Jay has likely hedged his bets, demanding some political-economic cover for stopping the money-printing that’s been goosing stocks to new highs (tech stocks) or gains for 2020 (S&P 500).

Presto, the bogus jobs reports is issued: good news! OK, Powell responds, that’s good but not enough. So we can anticipate the wheels are busy turning in the appropriate agencies to issue a surprisingly hot inflation number. A sudden spike in inflation would provide the additional cover the Fed needs to withdraw the stock market’s free-money lifeline.

Barring a hot inflation number, the Fed can always fall back on some other pretexts to turn off the money spigot and let the stock market start sliding into late October.

We can also imagine the Deep State tapping on other shoulders in town, reminding them of various skeletons in the closet and suggesting it’s time to take one for the Deep State team. After all, what’s a couple hundred billion dollars between friends?

Come on, Jay, you can always goose stocks back to new highs after the election. If Jay hesitates, fearing for his reputation as the rock-solid guarantor of new all-time highs in stocks, well, pressure can be applied on other players in various ways. Or it might even be suggested that Jay’s health is looking rather iffy, what with the stress and all, and perhaps a resignation for health reasons can be arranged.

The pressure on the Fed to turn off the money-printing that’s goosing stocks ever higher will be increasing as the election draws ever closer. The Deep State has lost every gambit so far in a humiliating string of failures, and killing the soaring stock market is the last best chance to torpedo Trump’s re-election.

This is for all the marbles, kiddies, and the gloves are about to come off. If the tap on the shoulder wasn’t persuasive, a punch in the gut might bring hearts and minds around to the desired perspective. After all, accidents can happen to just about anyone.

*  *  *

My recent books:

Will You Be Richer or Poorer?: Profit, Power, and AI in a Traumatized World ($13)
(Kindle $6.95, print $11.95) Read the first section for free (PDF).

Pathfinding our Destiny: Preventing the Final Fall of Our Democratic Republic ($6.95 (Kindle), $12 (print), $13.08 ( audiobook): Read the first section for free (PDF).

The Adventures of the Consulting Philosopher: The Disappearance of Drake $1.29 (Kindle), $8.95 (print); read the first chapters for free (PDF)

Money and Work Unchained $6.95 (Kindle), $15 (print) Read the first section for free (PDF).

*  *  *

If you found value in this content, please join me in seeking solutions by becoming a $1/month patron of my work via patreon.com.

Oil prices managed gains today (despite equity market weakness) on various ‘not-terrible’ headlines from BSEE (more gulf rigs still offline due to Cristobal), Nigeria (struggling to sell its crude so less supply hitting market), New Jersey lockdown lifted (more demand), and EIA’s outlook still hoping for a rebound in demand in Q3.

Inventories will once again be the main focus with hopes that the surge in product inventories was a blip due to Cristobal.

API

• Crude +8.42mm (-1.2mm exp)

• Cushing -2.285mm

• Gasoline -2.913mm (-200k exp)

• Distillates +4.271mm (+2.9mm exp)

US crude inventories were forecast to drop for the second week but API reported a surprising (and large) 8.42mm barrel build…

Source: Bloomberg

WTI was trading back below $39 ahead of the API print and slid modestly after the data…

We will have to wait for confirmation from the official data tomorrow but this is a notable build in the face of hope for a draw.