Category: zerohedge

Authored by Tom Luongo via Gold, Goats, ‘n Guns blog,

I’ve been on some form of low-carb diet since the 1990’s. If not for a few years of intense martial arts training and that dietary switch, I would have been likely ended up with type-II diabetes.

And well on my way to the grave.

I know, some of you are thinking, “More’s the pity.” Fair enough.

But, the truth is that once my wife and I started down that path and our health rapidly improved there was no going back. I clearly remember an early article in, of all places, the Gainesville Sun talking about how butter may not be bad for you.

That planted a seed and things went from there.

We started with Dr. Atkins. Then we moved on to books like Neanderthin and devoured, all puns intended, the work of the Drs. Mary and Michael Eades of Protein Power fame.

I went from 250 lbs. with high blood pressure. triglycerides and the kind of temper that cost me jobs (no lie) to dropping below 200 lbs for the first time since high school and more patience for the world.

My belly shrank. I could fit into 36 inch waist jeans.

My friends noticed it. My wife noticed it. My co-workers and my boss thanked me.

Being on that diet allowed me to handle the heat and stress at 35 of building my house in the North Florida summer; working sun up to sun down three days a week for seven-months straight.

I held my full-time job as a Senior Chemist at the same time, working four ten-hour days.

So yes, I had the endurance, focus, strength and fitness to work as a professional researcher and laboratory manager four days a week and an amateur framer, roofer, plumber, general contractor and ditch-digger the other three.

From March to October… in Florida. No days off. No bullshit.

The self-education continues today to refine what works and what doesn’t for us; what foods we’re allergic to and how can we support our organs and gut health as we enter our fifties.

Have I ‘fallen off the wagon’? Of course. At times really badly. I haven’t told you how much I loved my goat milk/duck yolk custard ice cream I used to make when I had a small dairy on the side. I sincerely love ice cream.

That’s the pernicious thing about sugar, like any other powerful drug, you always think you have control over it.

But you don’t. It controls you.

And as humans we really have no defense against the combination of fat and sugar. That’s why there is always room for desert.

And its control is far worse than cigarettes or coffee. I’ve quit both, it’s true. The former permanently the latter only when fasting (because I’m no ascetic).

Then you look in the mirror one day and you’re disgusted with what you see. And the only thing worse than that is knowing that you knew better and did it anyway.

Giving in to the Imp of the Perverse undermines your spirit far worse than any other mistake you can make.

And when I was forced by circumstance in 2017 to chain myself to my keyboard and ‘write or die’ to build a new career path, I didn’t treat myself as well as I should have.

And so, while I was in better health than I could have been I wasn’t happy about it either. Because I knew I should be better than that.

And it had gotten to the point of interfering with my ability to write at a level that I expected of myself, no less y’all.

That’s why three weeks ago I followed my wife onto a near all-meat diet. No exceptions, no “I can have a small fries with my hamburger,” or this one candy bar. Just meat, salt, the occasional egg and a little garlic with 20 to 24 hour fasts in between.

The dietary equivalent of cold turkey of everything bad.

And guess what? I’ve already lost significant girth, I sleep better, my concentration has improved, my joints don’t ache and I’m just plain happier.

Recently I had a physical ordered by my life insurance company. This was before I made the switch. And even then, as unhappy with myself as I was, my blood work was fine: a testament to eating mostly low carb, whole foods and staying away from God forsaken vegetables.

It wasn’t that hard for me. My body knows how to cycle in and out of ketosis now. The first couple of days are the toughest, thinking about food constantly. But once you get in the groove it’s not an issue.

Once you put your mind to it, as the saying goes, the rest is just doing it.

It wasn’t as hard as quitting sugar the first time. That was hard. Three weeks of that empty feeling in your stomach, the brain fog, the feeling of just being ‘off.’ It’s like those old V-8 commercials from the 80’s.

But here’s the thing. I was likely pre-diabetic at the time. My body had zero idea how to burn fat and so it resisted doing so for weeks. Once through that, however, I didn’t need a glass of pulverized compost material to keep me upright.

Low carb isn’t anything new now. We helped plow that field twenty years ago. And that’s a great thing.

But there is still this horrific stigma against meat that has zero basis in dietary reality. It is a holdover of Ancel Keyes’ moronic and virulent Lipid Hypothesis which demonized saturated fats.

But Keyes, like Michael Mann and his hockey stick chart of global temperatures, cherry picked his data to prove his point. And because what he said was in accordance with what the political establishment wanted to push on us, meat was vilified and vegetable oils (which have never been a big part of human nutrition) were elevated.

To the detriment of us all.

Trillions of dollars in misallocated capital to a theory that made us all fat, sick, stupid and perpetually pissed off.

Trillions to a health care industry designed to treat these new problems caused mostly from people eating like they are pigs being fattened for slaughter.

And the irony is, of course, that now we raise lean hogs as opposed to lard hogs. So even our pork is fed a better diet than we feed ourselves.

So much of our political debate about rising health care costs come down to treating lifestyle diseases brought on by insipid and venal government propaganda and the ideological zealotry of vegans.

Health care wouldn’t be the Byzantine nightmare and wholly unethical quicksand of graft, corruption and corporate profiteering if it wasn’t for Ancel Keyes and his disciples.

And the Democrats wouldn’t be pushing for Health Care to be a right as defined by everyone else has to pay for my shitty choices about what foods I push down my gullet.

Worse, today, after the mainstreaming of low-carb, we are still dealing with the remnants of Keyes and the vilification of meat-eating. Because they know that once a critical mass of us get trim, healthy and independent-minded, their amateurish narrative control techniques don’t work on us.

This is why we laugh at “Soy Boys” with “Bitch tits.”

They’ve given ground gradually and grudgingly. First it was butter was better than margarine, after telling us that trans-fats were better than saturated fats.

Then it was eggs are okay, even though a lot more people are allergic to egg whites than you would think.

But they won’t bring themselves to admit that saturated fats are the healthy fats. They are the ones that your body uses to build cell walls resistant to oxidative stress. They are the ones that are made of the ‘good cholesterol’ and not the nasty stuff the body produces when you starve it.

But, even then, grudgingly as the data started coming back, to hold the line they keep telling us, if you have to eat them, avacado, coconut and fish are okay.

Just stay away from the red meat!

Because the demonization of red meat cuts to the heart of the political con job that is modern cultural Marxism and its supposed moral high ground.

You can see this in the response to the landmark study just completed that concluded there is no perceivable risk from eating red meat as opposed to anything else. It immediately provoked apoplexy akin to doctors prescribing hemlock to treat eczema.

“Based on the research, we cannot say with any certainty that eating red or processed meat causes cancer, diabetes or heart disease,” said Bradley Johnston, an associate professor at Dalhousie University in Canada who co-led the review published on Monday in the Annals of Internal Medicine journal.

However, in what amounts to a scientific food fight, experts from Harvard, Yale, Stanford and elsewhere, including one of the review authors, said guidelines that could lead people to eat more red and processed meats were irresponsible.

They asked in a letter to the journal that it “pre-emptively retract publication” of the papers pending further review.

I can’t wait until the study comes out comparing those on a carnivore diet to vegan one. That’s the study no one in power wants to see the results of.

We’re at the overwhelming evidence stage of the benefits of not eating like our dinner eats and these guys are trying to hold back the dam and force the truth under the rug.

Because they can’t give up the dream, man.

Veganism and ethical vegetarianism are inextricably bound up with the push towards modern forms of social control. They are religions based on the mistaken, inherently Marxist, belief that humanity is a virus that needs to be contained.

Vegetarians claim a moral high ground they can’t support as an extension of an ideology built on the guilt of being alive, of denying their basic humanity as predators.

It is another false narrative designed to rob you of your reason physically as well as psychologically, since diet affects both in a vicious feedback loop of auto-immune disorders which are entirely avoidable, just like the donuts in the break room.

And the idea that you can just go to the gym and burn that donut off is simply ignorant of how the body actually functions. Calories in do not just equal calories out.

The body doesn’t treat a teaspoon of sugar the same way it treats an ounce of bacon grease. If you think that. Then you aren’t just ignorant, at this point, you are being willfully obtuse.

We don’t have a bathtub metabolism anymore than we have Keynes’ idea of a bathtub economy. Reducing our food intake to the same gross generalization that we do the economy via GDP is not only stupid but antithetical to truth.

The idea that calories are just calories is, literally meaningless. It strips out all meaning as to how specific molecules are utilized by the body and for what purpose. Just like reducing the economy to gross spending also strips out the meaning about what we spent the money on and how it was utilized.

If we spend all our money on hookers and blow do you think that’s any more sustainable than living on pasta, pizza and paninis?

But like all gatekeepers they will fail to hold containment on the truth because, as I keep saying, lies are expensive, the truth sells itself.

Don’t you ever wonder why they have to sell us on tofu but bacon sells itself?

I don’t.

*  *  *

Join my Patreon to help me bust open false narratives.  Install Brave if you want to help me starve Google from keeping us from talking.

While Democrats scramble to accuse President Trump of attempting to interfere with the 2020 US election by asking Ukraine to investigate former Vice President Joe Biden and his son Hunter, the MSM has been hard at work trying to discredit proof that a DNC contractor begged Ukraine for ‘dirt’ on the Trump campaign in 2016. 

You know, election meddling. 

As detailed in a 2017 Politico report that MSNBC‘s Katy Tur called Russian propaganda last week, DNC contractor and former Bill Clinton White House employee Alexandra Chalupa approached the Ukrainian embassy to solicit ‘dirt’ on the Trump campaign, and convince then-president Petro Poroshenko to help.

Now watch MSNBC‘s Katy Tur called this “Russian propaganda.” 

This is stunning. Watch @MSNBC‘s @KatyTurNBC deny Ukraine meddled in the 2016 election and call a @Politico report authored by @kenvogel “Russian propaganda.” https://t.co/Zx2FoMm1RU pic.twitter.com/UJIFkFgl6t

— Trump War Room (@TrumpWarRoom) September 27, 2019

As reported by The Hill‘s John Solomon in May, “In its most detailed account yet, the Ukrainian Embassy in Washington says a Democratic National Committee (DNC) insider during the 2016 election solicited dirt on Donald Trump’s campaign chairman and even tried to enlist the country’s president to help.”

In written answers to questions, Ambassador Valeriy Chaly’s office says DNC contractor Alexandra Chalupa sought information from the Ukrainian government on Paul Manafort’s dealings inside the country in hopes of forcing the issue before Congress.

Chalupa later tried to arrange for Ukrainian President Petro Poroshenko to comment on Manafort’s Russian ties on a U.S. visit during the 2016 campaign, the ambassador said.

Chaly says that, at the time of the contacts in 2016, the embassy knew Chalupa primarily as a Ukrainian American activist and learned only later of her ties to the DNC. He says the embassy considered her requests an inappropriate solicitation of interference in the U.S. election. –The Hill

Appearing on Fox News‘ “Hannity” on Tuesday, Solomon pushes back:

Let’s start with something that’s important about this. There is a media narrative that is false. How do we know it’s false? Because the documents I possess show it’s false. So let’s start with one of my favorites – this was Katy Tur on Friday night and many others across the weekend said “there is no evidence that the Ukraine Embassy was ever asked for help – to help the Democratic National Committee. In fact, Katy Tur called it Russian propaganda.”

“I have a statement from the Ukrainian Embassy in Washington. On the record, from their sitting Ambassador in Washington, that in fact Alexandra Chalupa – the DNC contractor, came to the Ukraine embassy in spring 2016 and asked for help in finding dirt on Donald Trump in the hopes of staging a Congressional hearing to hurt Donald Trump in the fall election of 2016. That is the Ukraine Embassy’s on the record statement.”

In addition, they state that Ms. Chalupa also asked for the Ukraine President to visit the United States and spend time with an investigative reporter trying to turn up dirt on Donald Trump and Paul Manafort. What did the Embassy do? They say they recognized this request for what it was; an improper request to influence the election, and they refused to cooperate with Ms. Chalupa.”

Watch: 

Having set expectation high again this quarter, with Musk telling employees in a recent email that the company “has a shot” at delivering 100,000 cars – which would have been a new record, the actual deliveries disappointed.

Consensus was for the carmaker to deliver 99,000 vehicles – they missed, delivering around 97,000 vehicles.

This should not be a total surprise, as we noted earlier, Morgan Stanley’s Adam Jonas called the Model S “old”, the Model X “overly engineered” and the Model 3 “trapped in a narrow sedan segment.”

And investors are not happy as the shares are down 5% after hours…

And then there’s this…

Quarterly reminder that Tesla likely has over 19,000 cars that remain unsold. Some used internally, but a lot still stacking up in lots around the world. $TSLAQ $TSLA pic.twitter.com/8BZoS86Rgr

— Paul Huettner, CFA (@Paul_M_Huettner) October 2, 2019

The company carefully CYA’d with the following comment:

“Our delivery count should be viewed as slightly conservative, as we only count a car as delivered if it is transferred to the customer and all paperwork is correct. Final numbers could vary by up to 0.5% or more.

Tesla vehicle deliveries represent only one measure of the company’s financial performance and should not be relied on as an indicator of quarterly financial results, which depend on a variety of factors, including the cost of sales, foreign exchange movements and mix of directly leased vehicles.”

But, if you’re banking on the company’s autonomous timeline to save the stock, Morgan Stanley’s Jonas simply lays down his arms and gives up:

“We think that both bulls and bears alike believe that Tesla’s autonomy timeline is unrealistic,” he says.

We couldn’t agree with you more, Adam. 

 

Authored by Michael Krieger via Liberty Blitzkrieg blog,

A second former Amazon employee would spark more controversy. Deap Ubhi, a former AWS employee who worked for Lynch, was tasked with gathering marketing information to make the case for a single cloud inside the DOD. Around the same time that he started working on JEDI, Ubhi began talking with AWS about rejoining the company. As his work on JEDI deepened, so did his job negotiations. Six days after he received a formal offer from Amazon, Ubhi recused himself from JEDI, fabricating a story that Amazon had expressed an interest in buying a startup company he owned. A contracting officer who investigated found enough evidence that Ubhi’s conduct violated conflict of interest rules to refer the matter to the inspector general, but concluded that his conduct did not corrupt the process. (Ubhi, who now works in AWS’ commercial division, declined comment through a company spokesperson.)

Ubhi worsened the impression by making ill-advised public statements while still employed by the DOD. In a tweet, he described himself as “once an Amazonian, always an Amazonian.”

– From the must read ProPublica expose: How Amazon and Silicon Valley Seduced the Pentagon

That U.S. tech giants are willing participants in facilitating mass government surveillance has been widely known for a while, particularly since whistleblower Edward Snowden risked his life and liberty to tell us about it six years ago. We also know what happens to executives who don’t play ball.

Perhaps the most high profile example relates to Joseph Nacchio, CEO of telecom company Quest in the aftermath of 9/11. Courageously, he was the only executive who pushed back against government attempts to violate the civil liberties of his customers. A few years later, he was thrown in jail for insider trading and stayed locked up for four years. He claimed his incarceration was retaliation for not bending the knee to government, which seems likely.

Charges his defense team claimed were U.S. government retaliation for his refusal to give customer data to the National Security Agency in February, 2001. This defense was not admissible in court because the U.S. Department of Justice filed an in limine motion, which is often used in national security cases, to exclude information which may reveal state secrets. Information from the Classified Information Procedures Act hearings in Nacchio’s case was likewise ruled inadmissible

Fast forward to today, and the tech giants have willingly and enthusiastically transformed themselves into compliant organs of the national security state. Big tech executives have by and large embraced this extremely lucrative and powerful role rather than push back against it. There’s simply too much money at stake, and nobody wants to go to the big house like Joe Nacchio. There is no resistance.

Just yesterday, we learned that Twitter’s executive for the Middle East is an actual British Army ‘psyops’ soldier. Unfortunately, this is not a joke.

As reported by Middle East Eye:

The senior Twitter executive with editorial responsibility for the Middle East is also a part-time officer in the British Army’s psychological warfare unit, Middle East Eye has established.

Gordon MacMillan, who joined the social media company’s UK office six years ago, has for several years also served with the 77th Brigade, a unit formed in 2015 in order to develop “non-lethal” ways of waging war.

The 77th Brigade uses social media platforms such as Twitter, Instagram and Facebook, as well as podcasts, data analysis and audience research to wage what the head of the UK military, General Nick Carter, describes as “information warfare”.

Here’s how Twitter responded to the revelation…

Twitter would say only that “we actively encourage all our employees to pursue external interests.”

They don’t even care.

While that’s troubling enough, I want to focus your attention on a brilliant and extremely important piece published a couple of months ago at ProPublica, which many of you may have missed. It details the troubling and incestuous relationship between Amazon and Google executives with the Department of Defense. A relationship which virtually guarantees these CEOs immunity as long as they play ball. It’s impossible to read this piece and come away thinking these are “just private companies.” They demonstrably are not.

In the case of Amazon, a Pentagon whistleblower named Roma Laster grew uncomfortable with the cozy relationship Jeff Bezos had with DOD leaders.

We learn:

On Aug. 8, 2017, Roma Laster, a Pentagon employee responsible for policing conflicts of interest, emailed an urgent warning to the chief of staff of then-Secretary of Defense James Mattis. Several department employees had arranged for Jeff Bezos, the CEO of Amazon, to be sworn into an influential Pentagon advisory board despite the fact that, in the year since he’d been nominated, Bezos had never completed a required background check to obtain a security clearance.

Mattis was about to fly to the West Coast, where he would personally swear Bezos in at Amazon’s headquarters before moving on to meetings with executives from Google and Apple. Soon phone calls and emails began bouncing around the Pentagon. Security clearances are no trivial matter to defense officials; they exist to ensure that people with access to sensitive information aren’t, say, vulnerable to blackmail and don’t have conflicts of interest. Laster also contended that it was a “noteworthy exception” for Mattis to perform the ceremony. Secretaries of defense, she wrote, don’t hold swearing-in events…

The swearing-in was canceled only hours before it was scheduled to occur.

Bezos would’ve certainly been sworn into that board had Laster not had the courage to speak up. She later received her reward.

Laster did her best to enforce the rules. She would challenge the Pentagon’s cozy relationship not only with Bezos, but with Google’s Eric Schmidt, the chairman of the defense board that Bezos sought to join. The ultimate resolution? Laster was shunted aside. She was removed from the innovation board in November 2017 (but remains at the Defense Department). “Roma was removed because she insisted on them following the rules,” said a former DOD official knowledgeable about her situation.

Real whistleblowers are never celebrated by mass media and are always punished. That’s how you distinguish a real whistleblower from a fraud.

As mentioned above, Laster also called out and angered Eric Schmidt who, as chairman of Alphabet (Google, Youtube, etc), was trying to sell services to the Pentagon while at the same time serving as Chairman of the Department of Defense’s Innovation Board. That’s about as incestuous and corrupt as it gets.

Schmidt, the chairman of the innovation board, embraced the mission. In the spring and summer of 2016, he embarked, with fellow board members, on a series of visits to Pentagon operations around the world. Schmidt visited a submarine base in San Diego, an aircraft carrier off the coast of the United Arab Emirates and Creech Air Force Base, located deep in the Nevada desert near Area 51.

Inside the drone operations center at Creech, according to three people familiar with the trip, Schmidt observed video as a truck in a contested zone somewhere was surveilled by a Predator drone and annihilated. It was a mesmerizing display of the U.S. military’s lethal reach…

A little more than a year after Schmidt’s visit, Google won a $17 million subcontract in a project called Maven to help the military use image recognition software to identify drone targets — exactly the kind of function that Schmidt witnessed at Creech…

Schmidt’s influence, already strong under Carter, only grew when Mattis arrived as defense secretary. Schmidt’s travel privileges at the DOD, which required painstaking approval from the agency’s chief of staff for each stop of every trip, were suddenly unfettered after Schmidt requested carte blanche, according to three sources knowledgeable about the matter. Mattis granted him and the board permission to travel anywhere they wanted and to talk to anyone at the DOD on all but the most secret programs.

Such access is unheard-of for executives or directors of companies that sell to the government, say three current and former DOD officials, both to prevent opportunities for bribery or improper influence and to ensure that one company does not get advantages over others. “Mattis changed the rules of engagement and the muscularity of the innovation board went from zero to 60,” said a person who has served on Pentagon advisory boards. “There’s a lot of opportunity for mischief”…

Over the next months, Schmidt and two other board members with Google ties would continue flying all over the country, visiting Pentagon installations and meeting with DOD officials, sessions that no other company could attend. It’s hard to reconstruct what occurred in many of those meetings, since they were private. On one occasion, Schmidt quizzed a briefer about which cloud service provider was being used for a data project, according to a memo that Laster prepared after the briefing. When the briefer told him that Amazon handled the business, Schmidt asked if they’d considered other cloud providers. Laster’s memo flagged Schmidt’s inquiry as a “point of concern,” given that he was the chairman of a major cloud provider.

The DOD became unusually deferential to Schmidt. He preferred to travel on his personal jet, and he would ferry fellow board members with him. But that created a problem for his handlers: DOD employees are not permitted to ride on private planes. Still, the staff at the board didn’t want to inconvenience Schmidt by making him wait for his department support team to arrive on commercial flights. So, according to a source knowledgeable about the board’s spending, on at least one occasion the department requisitioned military aircraft at a cost of $25,000 an hour to transport its employees to meet Schmidt on his tour. (The DOD’s spokesperson said employees did this because “there were no commercial flights available.”)

Similar to the situation with Bezos, Roma Laster started asking questions, which angered master of the tech and military-industrial-complex universe Eric Schmidt.

Schmidt responded by threatening to go over her head to Mattis, according to her grievance. She was told to stand down and never again speak to Schmidt. According to the grievance, her boss told her, “Mr. Schmidt was a billionaire and would never accept pushback, warnings or limits.”

There’s so much more in this excellent article, but the key takeaway is the troubling extent of the existing merger between tech giants and the national security state. Disturbingly, this appears to have become even worse in the aftermath of the Snowden revelations, and the reasons why are clear. First, there are billions upon billions of dollars to be made. Second, nobody from the private sector ever gets punished for violating the civil liberties of the American public on behalf of the government and intelligence agencies. On the contrary, the only people who ever lose their freedoms and livelihoods are those who blow the whistle on government criminality (Thomas Drake, John Kiriakou, Chelsea Manning, Edward Snowden and Julian Assange, just to name a few).

Which brings up a very uncomfortable, yet fundamental question. How dangerous are tech giants that have near monopoly level power in core areas such as communications and online retail and also enjoy state sponsorship and the total immunity that comes with it? Add to the equation the enormous amount of money up for grabs provided you play ball with the national security state and you have a very precarious situation. This isn’t a hypothetical future dystopian scenario. It’s where we stand today. 

Facebook and Google are two companies with known ties to the national security state that together have enormous control over who, for all practical purposes, gets to speak in the modern online public square. Then consider that the tech giants represent a perfect vehicle for the national security state to censor or disappear from the conversation those deemed problematic to imperial narratives.

The U.S. government cannot explicitly restrict most kinds of speech, but tech giants can do whatever they please and don’t even need to provide a reasonable justification. This means any relationship between companies with this sort of online speech-policing power and the national security state is extremely dangerous. It’s a conduit for fascism.

Tech giants are a conduit for fascism because tech giants can legally do at the government’s behest what the government cannot.
These companies are a clear and present danger to liberty.

— Michael Krieger (@LibertyBlitz) October 1, 2019

Then there’s Amazon. A company that has a $600 million contract with the CIA, has used questionable practices in attempts to secure a $10 billion JEDI cloud deal with Pentagon, is aggressively marketing its facial recognition software to police departments across the country, and is coaching cops on how to obtain surveillance footage from its Ring doorbell camera without a warrant. But it gets even worse.

In light of recent public concerns around facial recognition, Bezos and his company are actively writing legislation for Congress on the issue.

We learn:

Amazon CEO Jeff Bezos says his company is developing a set of laws to regulate facial recognition technology that it plans to share with federal lawmakers.

In February, the company, which has faced escalating scrutiny over its controversial facial recognition tech, called Amazon Rekognition, published guidelines it said it hoped lawmakers would consider enacting. Now Amazon is taking another step, Bezos told reporters in a surprise appearance following Amazon’s annual Alexa gadget event in Seattle on Wednesday.

“Our public policy team is actually working on facial recognition regulations; it makes a lot of sense to regulate that,” Bezos said in response to a reporter’s question.

The idea is that Amazon will write its own draft of what it thinks federal legislation should look like, and it will then pitch lawmakers to adopt as much of it as possible…

In a statement, ACLU Northern CA Attorney Jacob Snow said:

“It’s a welcome sign that Amazon is finally acknowledging the dangers of face surveillance. But we’ve seen this playbook before. Once companies realize that people are demanding strong privacy protections, they sweep in, pushing weak rules that won’t protect consumer privacy and rights. Cities across the country are voting to ban face surveillance, while Amazon is pushing its surveillance tech deeper into communities.”

Meanwhile, Amazon is now using mafia tactics to pressure retailers who feel forced to use the platform given its dominance in online retail, to pay for advertising. It’s not just small brands under the gun, even large companies with high name recognition like Samsonite are being twisted via increasingly unethical practices.

Via Vox:

As Recode’s Jason Del Rey explored in his Land of the Giants podcast about the rise of Amazon, companies that sell on Amazon are increasingly having to pay to show up in search results — even when people are searching for their specific brands.

Case in point: the luggage brand Samsonite, which has to pay for sponsored ads in order to be the top result when you search “Samsonite” on Amazon.

As Samsonite’s Chief E-commerce Officer Charlie Cole told Del Rey, “Amazon is making money off your products, making money off your data by creating brands, and Amazon is making money off the privilege of being on their platform by selling you advertising to protect your brand.”

“It’s been a tough relationship,” he added.

Think about how completely insane that is, yet it’s also exactly what you’d expect to happen when one company comes to completely dominate a space as fundamental to the modern economy as online shopping.

Naturally, there’s more. It’s been well documented how Amazon uses its knowledge of product sales on its platform to then rip off existing brands by copying them and making its own version.

Amazon is now straight copying Allbirds.

We have reached “peak cloning” in Silicon Valley.

There are no rules anymore – if you build a product that works, Amazon or Facebook will copy it.

People used to care. Not anymore. pic.twitter.com/73bDMgruMX

— Jeff Morris Jr. (@jmj) September 19, 2019

The more connected these tech giants are to the national security state, the more dangerous and unassailable they become. A destructive process which is already very much underway.

Centralized and unaccountable government power is always an existential threat to human liberty, but centralized and unaccountable government power exercised via tech behemoths which aren’t restrained by the Constitution is even worse. This is the world being built around us, and we’d be wise to address it soon.

*  *  *

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In the aftermath of today’s surprising WTO decision, in which the global trade mediator sided with the US in finding some $7.5BN in European Airbus subsidies illegal, moments ago the US Trade Rep confirmed that the US will waste no time in retaliating to what – for years – were illegal trade practices.

According to the USTR office, the US will impose a total of $7.5 billion in retaliatory tariffs on EU imports starting October 18, with 10% tariffs on large commercial aircraft, and 25% on agricultural and other industrial goods.

• U.S. WILL IMPOSE TARIFFS ON $7.5 BILLION OF EUROPEAN UNION IMPORTS BEGINNING OCT. 18, USTR SAYS
• U.S. WILL IMPOSE 10% TARIFFS ON LARGE COMMERCIAL AIRCRAFT AND 25% TARIFFS ON OTHER AGRICULTURAL AND INDUSTRIAL GOOD

The USTR also noted that its would publish the full list of items subject to tariffs over the next day.

And with that, instead of easing, the global trade war just sprung another major front, one which will see the EU retaliate in kind and impose tariffs on billions in US imports to the EU, guaranteeing that consumer prices in both the US and Europe will spike just as the world is entering a global recession, making further rate cuts by the Fed that much more complicated.

A manufacturing catacl-ism, a disappointing ADP jobs print, NY PMI plunges, crude builds (demand?), and fears about Bernie’s health sparking panic over Warren’s lead. But Fed’s Williams says they have the tools (well in one way he might be right there) and they promise to use them earlier this time… The (stock) market didn’t seem to buy it (even as the dollar and long bond ended unchanged)…

Although the market’s demand for rate-cuts in October is soaring…

Source: Bloomberg

China remains closed but US-based China ETF remains lower on the week…

Source: Bloomberg

Europe was a bloodbath with UK’s FTSE 100 crashed today, dropping 3.2% – the most since Jan 2016…

Source: Bloomberg

US markets cratered today led by Trannies…

Trannies are down 5% so far this week…

The Dow is down 1000 points from the catacl-ism…Some have argued today’s drop accelerated when Bernie Sanders headlines hit…

Sparking this…

And all the major US equity indices have broken below key technical levels… (Russell 2000 <200DMA, rest below 100DMA)

Both Defensives and Cyclicals were hit today, but Cyclicals considerably worse…

Source: Bloomberg

“Most Shorted” stocks fell for the 10th day in the last 12 after a huge squeeze to start September…

Source: Bloomberg

VIX topped 21 intraday and the term structure fell back into inversion…

Source: Bloomberg

Credit markets are starting to crack wider…

Source: Bloomberg

Treasury yields were down across the curve today but there was a very notable outperformance at the short-end (2Y -6bps, 30Y -0.5bps)

Source: Bloomberg

10Y Yields fell back below 1.60%…

Source: Bloomberg

The yield curve (3m10Y) remains inverted…

Source: Bloomberg

And the market shifted more dovishly – now pricing in 1.37 rate cuts by end 2019…

Source: Bloomberg

The Dollar was very modestly lower on the day, mimiccing yesterday’s rollercoaster ride…

Source: Bloomberg

Amid all the chaos, cryptos were ‘stable’…

Source: Bloomberg

Precious metals were bid today, back into the green for the week as oil tumbled after a big surprise crude build…

Source: Bloomberg

Gold futures surged back above $1500…

WTI tumbled to near 2-month lows – unchanged in almost 4 months – after a surprise crude build today, erasing all the Saudi attack gains…

Gold topped stocks once again year-to-date…

Source: Bloomberg

Finally, after being buoyed by ‘use-it-or-lose-it’ spending from the US in September, global macro data is collapsing fast…

Source: Bloomberg

Why ISM Manufacturing matters…

And, if you want to see what propaganda charted looks like, here it is…

Spread between positive & negative sentiment concerning consumer & manufacturing found in major T.V. news programming: financial media can’t get more bifurcated over demand & supply-sides of economy@DataArbor pic.twitter.com/YcANvwmprP

— Liz Ann Sonders (@LizAnnSonders) October 1, 2019

Just keep buying stuff ‘Murica!!

A little over a month ago, we warned that hedge fund crowding, especially within momentum stocks, had emerged as “one of the biggest market risks”…

… and just a few days later we got the infamous factor crash, as momentum/low beta stocks plunged as value/most shorted names exploded higher, in the process wiping out most YTD gains for the most popular hedge fund factor while the surge in the most hated trade meant that countless hedge funds were left flat for the year after sporting double-digit gains just days earlier.

Yet while the violent moves underscored just how illiquid, and ephemeral, the market has become, and how quickly even the most profitable trades can reverse, the bigger problem revealed by the quant quake, which saw the biggest 2-day losses for sector-neutral momentum factors ever…

… what the events of early September demonstrated is just how great a risk position crowding has become for asset managers.

Commenting on precisely this risk, Bank of America has published a new report in which it warns that “the diversification benefits of investing in different types of asset managers may be more limited than usual” simply because “everyone now owns the same stuff.”

Specifically, in addition to maintaining their now traditional biases toward growth and away from value and yield, BofA finds that “the overlap between the 50 largest stock exposures hit record levels this year.”

This happened as hedge funds cut their net exposure to Utilities, where they have been overweight in first half of this year, down to underweight (0.90x) – similar to “long only’s” persistent underweight in bond-proxy sectors. The key difference between LOs and HFs resides in cyclical versus defensive exposure – hedge funds are far more defensively positioned than LOs, and are one standard deviation below their long-term average exposure to cyclical vs. defensive sectors.

Incidentally, for those asking which stocks have the most overlap between long-only funds and hedge funds, the answer is shown in the chart below.

Meanwhile, despite the recent quant fireworks, BofA finds that even though active managers have historically maintained a bias towards high growth and low yield, the deviation between the two has hit a new record on Monday.

Specifically, among large cap long-only funds, Dividend Yield is now third most neglected factor (0.46x) of 47 factors the bank tracks, while Long-term Growth is one of just three factors where LOs maintain an overweight (1.09x).

In short: last month’s quant quake – while historic – is just the start of what will be a series of violent, massive market reversals as investors find out that if everyone owns the same things, there is nobody left to buy when everyone starts selling at the same time.

 

Via SaraACarter.com,

“Analysts need to be African-Americans, not people that are not,” Rep. Rashida Tlaib  said.

“It’s true, I think non-African-Americans think African-Americans all look the same!”

She said she has witnessed people confuse Reps. John Lewis, D-Ga., and Elijah Cummings, D-Md., who both are black and bald.

Detroit’s chief of police, Chief James Craig, gave Tlaib a tour of the Real Time Crime Center, where the department uses facial recognition technology to find suspects.

Craig, who is black, did not go for Tlaib’s suggestion.

“I trust people who are trained, regardless of race, regardless of gender,” he responded.

This came after Tlaib claimed that “the error rate among African-Americans, especially women,” was 60 percent.

“I understand the technology real well,” Craig said. He showed Tlaib how his analysts examine the software’s results before making determinations.

“See if you can get some of our money back until they fix it,” Tlaib said, to which Craig simply replied, “No.”

The Detroit Police Department extended the invitation to Tlaib in August, after she described facial recognition technology as “bulls—.”

@RashidaTlaib Before you criticize the software, come to our Real Time Crime Center to see how we @detroitpolice responsibly use it in efforts to identify criminals involved in violent crimes. Let’s set a date. https://t.co/aR7DOjQe2a

— Detroit Police Dept. (@detroitpolice) August 20, 2019

Click here to read this in full…

While President Trump is now accusing Rep. Adam Schiff (D-CA) of ‘helping to write’ a CIA whistleblower’s complaint at the heart of impeachment proceedings, the New York Times is out with a Wednesday article designed to put distance between the House Intelligence Committee Chairman by suggesting Schiff had no more than a vague sneak peek. 

Trump claims Adam Schiff wrote the whistleblower complaint. pic.twitter.com/jSv6pe9lcT

— Jason Easley (@PoliticusJason) October 2, 2019

As The Times reports, “The Democratic head of the House Intelligence Committee, Representative Adam B. Schiff of California, learned about the outlines of a C.I.A. officer’s concerns that President Trump had abused his power days before the officer filed a whistle-blower complaint,” adding “the original accusation was vague,” and “The aide did not share the whistle-blower’s identity with Mr. Schiff or anyone else.” 

So – according to the Times, Schiff kinda sorta knew what the whistleblower said, and a House Intel Committee aide told him (or her) to get an attorney, who happens to be Andrew Bakaj – who “interned for Schumer in the spring of 2001 and for Clinton in the fall of the same year,” per The Federalist. 

GOP spokeswoman Elizabeth Harrington has called it ‘COLLUSION’ and a ‘CON JOB’ in a Wednesday afternoon tweet.

“The whistle-blower’s decision to offer what amounted to an early warning to the intelligence committee’s Democrats is also sure to thrust Mr. Schiff even more forcefully into the center of the controversy.”

Ya think?!

Yes, people should take CIA coup attempts very seriously!

— Elizabeth Harrington (@LizRNC) October 2, 2019

Over the weekend, when trying to isolate the bank(s) behind the recent repocalypse, we looked at the aggregate cash levels of commercial banks in the US (which including foreign banks) as published each week by the Fed, and found that cash at foreign banks operating in the US rose by a respectable $13.6BN in the week ended Sept 18, to $537,8BN, in line with levels where foreign bank cash had been for much of the past two months.

“In other words”, we wrote “to find the culprit for the latest repo shock, don’t look to Europe (those banks have enough pain on their plate with the ECB recently launching QEternity, to also have to worry about overnight funding in the US) but look for clues among domestic US banks. “

Three days later, Reuters did just that, and in a report which surprisingly flew deep under the radar, appears to have found the one bank that may have been the inadvertent reason for the repo market to lock up on the 11th anniversary of Lehman when the repo rate exploded as high as 10%.

According to Reuters, “JPMorgan Chase has become so big that some rival banks and analysts say changes to its $2.7 trillion balance sheet were a factor in a spike last month in the U.S. “repo” market, which is crucial to many borrowers.“

As a reminder, just days after the record repo rate surge, a clearly clueless NY Fed president John Williams told the FT in an interview that the Fed was examining “why banks with excess cash failed to lend to the overnight money market, following a week that revealed cracks in the US’s financial plumbing.“

The answer: big changes JPMorgan made in its balance sheet “played a role in the spike in the repo market.”

Specifically, using public data, and conducting an analysis similar to the one we did last weekend tracking commercial bank cash levels, Reuters found that JPMorgan reduced the cash it has on deposit at the Federal Reserve, from which it might have lent, by $158 billion in the year through June, a 57% decline.

While JPMorgan’s moves were seen as logical responses to interest rate trends and post-crisis banking regulations, which have limited it more than other banks, “the data shows its switch accounted for about a third of the drop in all banking reserves at the Fed during the period”, Reuters adds. As a reminder, the recent slide in bank cash levels took the Fed’s reserves to the lowest level since 2012:

“It was a very big move,” said a Reuters source who watches bank positions at the Fed but did not want to be named. An executive at a competing bank called the shift “massive.”

And while other banks also brought down their cash, it was by only half the percentage, on average, according to Reuters calculations. One of them, Bank of America, the second-biggest U.S. bank by assets, with a $2.4 trillion balance sheet, took down 30% of its deposits, a $29 billion reduction, less than a fifth of JPM’s cash decline.

JPMorgan or not, as we showed for the past two weeks, total deposits at the Fed from banks have come down sharply over the past year as a consequence of the central bank’s decision to gradually reduce the vast holdings of bonds it had acquired to bolster the economy after the financial crisis: the reason is simple – as the Fed tapered its bond portfolio as part of QT, its deposits from banks have also declined.

“All of the banks were doing this to a degree,” said one Wall Street banking analyst, requesting anonymity because he was not authorized to speak on the record, adding: “JPMorgan does look like an outlier here.”

Ok, so we now know we can blame JPMorgan for not stepping up when the bank with the largest cash balances at the Fed clearly should have. But why?

Well, whereas in the past JPMorgan would have “gladly seized the opportunity to lend cash in the repo market, where loans are backed by the best collateral, often U.S. Treasury securities”, on on Sept. 17 even as the majority of repo loans were being made at 5% and above, twice the usual rates, “JPMorgan was limited in how much of its remaining cash it could provide because of regulatory and other constraints.”

The spike in rates reflected extra demand for cash, which was widely anticipated due to corporations requiring cash to make scheduled tax payments and banks and other firms needing it to buy newly-issued U.S. Treasury securities.

In other words, without the regulatory requirements and official constraints – most of which are created by the Fed itself – on JPMorgan, the rate wouldn’t have spiked to 10%, the person said.

Ironically, it was JPMorgan that made the biggest draws from the Fed late last year and bought securities, winning praise from analysts for locking in fixed interest rates before Federal Reserve cuts. Buying the securities also offset pressure on JPMorgan’s mortgage loan portfolio from falling rates. JPMorgan also needs cash for sudden demands by corporate depositors and to meet government requirements for reserves on checking account deposits.

It is this cash level that regulators now oversee to make sure there is no repeat of the cash crunch that took place during the 2008 financial crisis; as a result JPM must comply with rules which require banks to keep additional cash in case they fail and the government needs to transfer their operations in viable condition to other firms. Banks do not disclose how much of this so-called resolution cash they must hold, but the amount is clearly significant if $1.4 trillion in “excess” reserves turned out to be woefully insufficient.

Another post-crisis regulation imposes a capital surcharge on banks that are most important to the global financial system and it gives JPMorgan particular reason not to make repo loans going into the last three months of the year.

That is especially true for repos with firms from abroad, which include U.S. branches of foreign banks and Cayman Islands-registered hedge funds. Such loans could push JPMorgan’s surcharge higher, requiring it to carry an additional $8 billion of capital, a Goldman Sachs report said.

According to Goldman, JPMorgan’s capital surcharge is already the highest of any U.S. bank, which means its must make more profit from its business to produce the same return on shareholder equity.

Separately, as we reported before, Goldman analysts see the repo market pressures continuing under the regulatory constraints and what they believe is a shortage of extra cash on deposit at the Fed. Their solution: resuming Treasury purchases by the Fed, which they believe should conduct roughly $15bn/month rate of permanent OMOs, enough to support trend growth of the balance sheet plus some additional padding over the first two years to increase the size of the balance sheet by $150bn, restoring the reserve buffer and eliminating the current need for temporary OMOs. Altogether, this would boost the Fed’s balance sheet by a total of $180bn/year and result in net UST purchases by the Fed (the sum of the red and grey bars) of roughly $375bn/year over the next couple of years. When netting the purchases to rollover maturing debt, the monthly total rises to about $20BN/month on average.

For those asking, the $20BN in soon to be announced monetizations is virtually the same as the total debt purchased under the fully-upsized QE1 which was launched in response to the financial crisis, as the following JPMorgan chart shows:

Just whatever you do, “don’t call it QE” or someone may get the impression that the Fed is once again in the bank bailout business…