Category: zerohedge

Authored by Dagny Taggart via The Organic Prepper blog,

A recent report from Kaiser Health News raises serious concerns about the spread of “medieval diseases” that are resurging in some parts of the US.

“Infectious diseases – some that ravaged populations in the Middle Ages – are resurging in California and around the country, and are hitting homeless populations especially hard,” the report explains.

Los Angeles recently experienced an outbreak of typhus — a disease spread by infected fleas on rats and other animals — in downtown streets. Officials briefly closed part of City Hall after reporting that rodents had invaded the building.

People in Washington state have been infected with Shigella bacteria, which is spread through feces and causes the diarrheal disease shigellosis, as well as Bartonella quintana, which spreads through body lice and causes trench fever.

Hepatitis A, also spread primarily through feces, infected more than 1,000 people in Southern California in the past two years. The disease also has erupted in New Mexico, Ohio and Kentucky, primarily among people who are homeless or use drugs. (source)

These diseases will eventually spread to the public.

While the outbreaks are occurring primarily among the homeless, public health officials warn that these diseases can easily spread outside of that population.

Terms like “disaster” and “public health crisis” are being used to describe the outbreaks.

In his State of the State speech in February, California Governor Gavin Newsom warned, “Our homeless crisis is increasingly becoming a public health crisis,” citing outbreaks of hepatitis A in San Diego County, syphilis in Sonoma County, and typhus in Los Angeles County.

“Typhus,” he said. “A medieval disease. In California. In 2019.”

The diseases sometimes are referred to as “medieval” because people in that era lived in squalid conditions without clean water or sewage treatment, said Dr. Jeffrey Klausner, a professor of medicine and public health at UCLA.

The growing homeless population means more outbreaks are likely.

The report goes on to explain that the homeless population has grown in the past two years, and infectious diseases spread quickly and widely among those who are living outside or in shelters.

“About 553,000 people were homeless at the end of 2018, and nearly one-quarter of homeless people live in California,” the report says.

Sidewalks contaminated with human feces, crowded living conditions, weakened immune systems and limited access to health care are all factors contributing to the proliferation of these medieval diseases.

People living on the streets or in homeless shelters are vulnerable to such outbreaks because their weakened immune systems are worsened by stress, malnutrition. and sleep deprivation. Many also have mental illness and substance abuse disorders, which can make it harder for them to stay healthy or get health care. (source)

Dr. Glenn Lopez, a physician with St. John’s Well Child & Family Center, who treats homeless patients in Los Angeles County, described what conditions are like for people living on the streets.

“The hygiene situation is just horrendous. It becomes just like a Third World environment where their human feces contaminate the areas where they are eating and sleeping,” he said.

Don’t be fooled into thinking you are safe from these diseases.

Those infectious diseases are not limited to homeless populations, Lopez warned. “Even someone who believes they are protected from these infections are not.”

At least one Los Angeles city staffer said she contracted typhus in City Hall last fall. And San Diego County officials warned in 2017 that diners at a well-known restaurant were at risk of hepatitis A.

There were 167 cases of typhus from Jan. 1, 2018, through Feb. 1 of this year, up from 125 in 2013 and 13 in 2008, according to the California Public Health Department. (source)

Typhus is a bacterial infection that can cause a high fever, stomach pain, and chills. It usually can be treated with antibiotics. Outbreaks are more common in overcrowded and trash-filled areas that attract rats. Clusters of the flea-borne disease were reported in downtown Los Angeles and Compton last fall. Health officials said they also have occurred in Pasadena, likely due to people feeding stray cats that are carrying fleas.

In February, the county announced another outbreak in downtown Los Angeles that infected nine people, six of whom were homeless. After city workers said they saw rodent droppings in City Hall, Los Angeles City Council President Herb Wesson briefly shut down his office to rip up the rugs, and he also called for an investigation and more cleaning. (source)

There were 948 cases of hepatitis A in 2017 and 178 in 2018 and 2019, the state public health department said. That outbreak killed 21 people.

Hepatitis A is caused by a virus and is usually transmitted when people come in contact with feces of infected people. Most people eventually recover on their own, but the disease can be very serious for those with preexisting liver conditions.

Pneumonia and tuberculosis also occur among homeless populations, but are more often seen in shelters.

Infectious disease outbreaks are a public health disaster.

Dr. Jeffrey Duchin, the health officer for Seattle and King County, Washington, said the infections around the country are not surprising. The lack of attention to housing and health care for the homeless and the lack of bathrooms and places to wash hands are contributing to the problem, he explained.

“It’s a public health disaster,” he said. He has seen shigellosis, trench fever, and skin infections among homeless populations in his region.

“It really is unconscionable,” said Bobby Watts, CEO of the National Health Care for the Homeless Council, a policy and advocacy organization. “These are all preventable diseases.”

These diseases will become a widespread problem if the SHTF.

If outbreaks like these are beginning to spread among the population now, can you imagine what things will be like if the SHTF?

If you think it can’t happen here, you’d be mistaken.

Just take a look at what happened in Puerto Rico after Hurricane Maria hit. Selco has outlined – in tragic detail – what life was like after SHTF after the Balkan War of the 90s.

In the article Venezuela Faces the Return of Forgotten Diseases, Jose explained that tuberculosis, diptheria, ehrlichiosis (a tropical variation of Lyme disease), and leishmaniasis are spreading quickly and are hard to treat due to the lack of medication and proper nutrition.

As Lizzie Bennett explained in Disease: 10 Conditions That Will Become Far More Common After A Collapse, “Many diseases are opportunists, they will surface at a time the conditions are right for them to flourish and most often this is at a time when humans really could do with concentrating on other stuff.” She goes on to outline ten diseases (typhoid is one of them) “that will make their presence felt after a major, long term, disaster be it war, societal collapse or in some cases even an economic downturn.”

For more on avoiding infection with contagious disease now and after SHTF, please see 5 Simple Pieces of LIFESAVING Medical Knowledge and The Grim Reality of Survival Medicine in Austere Conditions.

via ZeroHedge News http://bit.ly/2TVKQMl Tyler Durden

President Trump on Friday said that the law is “100 percent” on his side in an longstanding battle with Democrats over his tax returns. 

Trump, who has agreed to “absolutely” release his returns once they are no longer under IRS audit, told reporters “Hey, I’m under audit. But that’s up to whoever it is. From what I understand the law is 100 percent on my side.”

President Trump: “From what I understand, the law is 100% on my side” in battle with Democrats over release of tax returns. https://t.co/eaFJf8g2ry pic.twitter.com/2fbEvRLQqT

— The Hill (@thehill) April 5, 2019

That’s not good enough for Congressional Democrats

Wednesday evening Ways and Means Committee Chairman Richard Neal (D-MA) said Wednesday evening that he had filed a formal request with the Treasury to obtain six years’ worth of the president’s tax returns, putting Treasury Secretary Steven Mnuchin in the hot seat. 

“[The] request tests Mnuchin’s oath of office: whether Mnuchin will faithfully execute the laws of the United States, or whether Mnuchin will bend to the will of the president,” said Steve Rosenthal, a senior fellow at the Urban-Brookings Tax Policy Center who testified before Congress in February about Trump’s tax returns. 

When asked on Thursday if he would instruct the IRS to withhold his returns, Trump said “They’ll speak to my lawyers and they’ll speak to the attorney general.” 

The IRS has stated that audits don’t preclude people from releasing their own tax information, while House Democrats are attempting to use a provision in the federal tax code which allows the chairmen of Congressional tax committees to ask for tax returns for examination in a closed session. 

The law says that the Treasury secretary “shall furnish” the documents for nonpublic examination – a virtually useless requirement given Capitol Hill’s pervasive leaks. 

Pushback

Several Key Republicans stand opposed to Neal’s request, including Rep. Kevin Brady of Texas and Sen. Chuck Grassley of Iowa. 

“Weaponizing our nation’s tax code by targeting political foes sets a dangerous precedent and weakens Americans’ privacy rights,” wrote Brady in a Wednesday letter to Mnuchin. “As you know, by law all Americans have a fundamental right to the privacy of the personal information found in their tax returns.” 

Key Republicans are critical of the request. The top Republican on the Ways and Means Committee, Rep. Kevin Brady (R-Texas), argued in a letter to Mnuchin Wednesday that the request is “an abuse of the tax-writing committees’ statutory authority,” and he said it weakens Americans’ right to have their personal information kept private.

Senate Finance Committee Chairman Chuck Grassley (R-Iowa) said Thursday that courts have ruled that congressional requests for information need to have legitimate legislative purposes, and Democrats have fallen short on that front.

“They don’t have a purpose,” he said. “All they have are a lot of excuses.” –The Hill

Senator Lindsey Graham, on the other hand, suggested that all 2020 candidates should be requred to release their tax returns. 

Sen. Lindsey Graham: “I think you should release your tax returns, if you’re running for president in 2020.”

Lawmakers split as they respond to Pres. Trump’s claims that an audit is keeping him from releasing his tax returns. https://t.co/wLL0DNqH3c pic.twitter.com/HmXPyp3MXp

— ABC News (@ABC) April 4, 2019

During a March Ways and Means Committee hearing, Mnuchin said that the Treausry Department would “follow the law and we will protect the president as we would protect any individual taxpayer under their rights.”

via ZeroHedge News http://bit.ly/2G32CcM Tyler Durden

Via The Organic Prepper blog,

This weekend, on April 6th, we’re having another Y2K. This one is on GPS devices, as they roll over from “week 1024” to “week 1.” If you have a Garmin or a TomTom on which you rely for navigating, you could run into trouble.

And could be even worse than that minor inconvenience. Some experts warn that the power grid, transportation, and the financial system could be affected.

What’s this all about?

First, here’s what’s going on.

The rollover issue itself is caused by the fact that GPS systems count weeks using a ten-bit parameter. This means they start counting at week zero and reset when they hit week 1,024. The first count (or “GPS epoch”) started on January 6th, 1980, and the first reset took place on August 21st, 1999. That means the next one is due April 6th this year. (source)

The good news is, devices have successfully been through an epoch before. The bad news is, some devices could go haywire and we’re way more tied into the GPS grid than we were when it happened in ’99.

What’s the worst case scenario?

Relax. I don’t think planes will begin crashing into the ocean.

But, if you have an older device and you haven’t been updating it, there is the possibility that the epoch could cause big problems.

When the rollover happens older devices may reset their date, potentially corrupting navigation data and throwing off location estimates. GPS relies on precise timing data to operate, and each nanosecond the clock is out, translates into a foot of location error.

All this is why some have compared the issue to a sort of mini Millennium, or, Y2K Bug for GPS receivers that will come into affect from April 6th this year. Bug. That was also caused by a number rollover problem, as a lot of early software recorded the year using a two-digit code (“78” for “1978” and so on) that reset when clocks hit the year 2000. (source)

Computers. Sheesh.

And, like a Ginsu knife commercial, there’s more.

Just because you don’t have problems on April 6th, it doesn’t mean you’re out of the woods.

…it’s worth noting that just because the next GPS week reset is scheduled for April 6th, actual errors might kick in later. As telecoms testing company Spirent noted in a blog post, some devices may have restarted their week count later — for example, when the manufacturer compiled their firmware. As Spirent’s Guy Buesnel writes, that means “the impact won’t necessarily be felt on rollover day itself. In fact, it’s much more likely that an affected receiver won’t start outputting erroneous data until long after the 6 April 2019.” (source)

There’s really no way then, to know if your GPS will one day steer you horribly wrong.

Unless you follow these instructions.

The good news is, you can avoid all these problems with a simple update. The Department of Homeland Security released a white paper with these recommendations:

Critical Infrastructure and other owners and operators are strongly encouraged:

1. to investigate and understand their possible dependencies on GPS for obtaining UTC,

2. to contact the GPS manufacturers of devices they use to obtain UTC

a. to understand the manufacturers’ preparedness for the April 6, 2019 WN rollover,

b. to understand actions required by CI and other owners and operators to ensure proper operation through the April 6, 2019 WN rollover, and

3. to ensure that the firmware of such devices is up-to-date (source)

Garmin says it’s no big deal, but you can also go here to learn how to update your device.

TomTom, on the other hand, warns that you really need to update your device and explains how.

Possible effects of the GPS Y2K

The most likely issue is that your car’s navigation system will be wonky, with inaccurate times of arrival, and incorrect times and dates.

But other problems could happen, too.

Financial companies who use GPS to record trades could have issues when the times, dates, or locations are off. As well, ports that use GPS location to report the loading of ships could have inaccurate information.

And the website, Tom’s Guide, reported even more serious problems might occur.

…because GPS satellites are also crucial to digital timekeeping used by websites, electrical grids, financial markets, data centers and computer networks, the effect of April 6 may be even more wide-ranging.

“I’m not going to be flying on April 6,” said one information-security expert during a presentation at the RSA 2019 security conference in San Francisco this week…

…”The effects would be more widespread [today] because so many more systems have integrated GPS into their operations,” said Bill Malik, a Trend Micro vice president who said he wouldn’t fly April 6, in a private conversation with Tom’s Guide.

“Ports load and unload containers automatically, using GPS to guide the cranes,” Malik said. “Public-safety systems incorporate GPS systems, as do traffic-monitoring systems for bridges. Twenty years ago these links were primitive. Now they are embedded. So any impact now will be substantially greater.”…

…FalTech GPS, a British company that makes GPS signal repeaters for indoor use, said in a blog post that “some GPS receivers, or other systems that utilize the date and time function, may not be able to cope.”

“Financial markets, power generating companies, emergency services and industrial control systems may be affected, as well as fixed-line and cellular communications networks,” the post continues. (source)

Experts seem to be at odds over the risk.

Some experts think that the risk is negligible, while others think this is something to which we should pay strict attention.

Carl “Bear” Bussjaeger, a New Hampshire-based science-fiction writer, Air Force veteran and former telecommunications network technician, reached out to us via Twitter to say that the link between GPS timing and telecom networks is not direct.

“Networks don’t time off GPS,” Bussjaeger said in a tweet. “They time off internal/master station clocks. Those clocks periodically synchronize off GPS.”

In a further conversation, Bussjaeger told us he had monitored the 1999 GPS epoch rollover as part of his telecoms job, and that there was “not so much as a bit error” on the network clocks.

“The clocks used in telecoms can free-run for days,” he said. “They’re very stable. GPS timing is really just a backup to the backup.”

During an epoch rollover, Bussjaeger said, “geolocation could glitch, but only momentarily, if at all. A GPS unit might have to reacquire the birds [satellites] to determine its location, but it’s no worse than turning on a unit and waiting for it to acquire [the satellite signal] in the first place.”

“Twenty years ago, we didn’t have a problem,” he added. “I rather expect that clocks are better, more stable now.” (source)

On the other hand, not everyone sees it as a non-event.

“I would say it’s legitimate to be concerned,” Brad Parkinson, the retired Air Force colonel and Stanford University professor who was the lead architect of GPS, told San Francisco’s KPIX-TVin an interview published April 2.

“GPS affects everything we do,” he said. “It affects timing, banking, cell towers, airplanes, ships, passengers in cars … everything that we can imagine.”

“If you’re driving your car and it were to suddenly say you’re in the middle of the Pacific Ocean, be very suspicious,” he told KPIX-TV. (source)

So, basically, the vibe I’m getting from this is that nobody really knows what will happen, or even if anything will happen. Either way, it’s good to be aware that there’s some potential for issues.

via ZeroHedge News http://bit.ly/2UkfxzN Tyler Durden

In a unique twist on the excesses of the last credit bubble, Canada’s bond market is now issuing bonds backed by increasingly riskier assets, but that hasn’t stopped investors from jumping at the chance to buy them – because why would history ever repeat itself when central bankers are here to make sure there is no more risk, ever? 

According to Bloomberg, some popular recent deals have included debt backed by assets like mortgages on junk-rated Hudson’s Bay stores and consumer loans that charge interest rates of up to 40%. There is also new debt being backed by home-equity lines of credit, credit cards, and auto loans/leases. Non-banking mortgage lenders may also soon issue similar debt, according to the report. In fact, the only thing that differentiates the current Canadian bond issuance frenzy from what took place in the US in 2005-2006 is… well… we’ll get back to you on that.

These bonds in Canada are starting to hit the market as Canada’s own bond market inverts with the yield on the 10 year government bond trading below the Bank of Canada’s overnight rate. Consumer spending has been poor and inflation has been weak in the country, however its economy recorded its best monthly advance in growth in eight months in January, and has an unemployment rate of 5.8%, a four decade low, so all must be well…

Randall Malcolm, senior managing director of fixed income at Sun Life Investment Management said: “The flattening of the curve, in which you see the ten year bonds inside the overnight rate is prompting investors to hunt for yield.”

Some of these new issues include C$202 million of securities backed by mortgages on Hudson’s Bay department stores, put together by RBC. The top portion of these bonds were priced to yield 3.64%, which is about 200 basis points over government issued bonds. A smaller Class “B” tranche of bonds were issued at a yield of 4.63%. The borrower of the loans is a joint venture between Hudson’s Bay and RioCan Real Estate Investment Trust. Hudson’s Bay is rated six grades below investment grade and RioCan Real Estate Investment Trust holds S&P global’s second-lowest investment rating. Hudson’s Bay has reported losses 9 out of its last 10 quarters. 

At least during the financial crisis, we could blame the ratings agencies for not doing their jobs. This coming crisis we’ll instead have to blame underwriters and bond buyers for ignoring them. 

The issue has an “element of concentration which I haven’t seen in a long time,” said Malcolm, referring to the fact that it is Canada’s first-ever commercial MBS pooling of loans from a single entity.

Fairstone Financial also recently issued C$322.4 million in bonds backed by consumer loans with rates as high as 39.99%.The issue has an expected maturity of 2.6 years and offers a 3.94% yield. The punchline: 70% of those loans had FICO scores below 649, which is also better known as subprime. It was the first non-prime asset backed security deal out of Canada since 2007. Back then things did not work out quite as expected.

Fairstone spokeswoman Fiona Story said that interest in the deal was brought on by: “Fairstone’s long history and tenured track record of providing transparent and responsible lending options for a segment of the Canadian market that may experience sudden financial needs, but is not eligible for prime credit.”

Canada also had its first issue of Heloc bonds since October 2017 when Fortified Trust sold C$750 million of notes at 2.56%. Borrowing through Helocs in Canada has grown faster than mortgages since 2017 and represents about 11% of total household debt. 

There have also been five additional issues backed by credit-card debt and two by auto loans and leases. Canadian consumers reduced their average monthly payments on credit cards in February to 38% of outstanding balances – the lowest level since 2015. 

Vivek Selot, a credit analyst at RBC, said in a March 27 note: “That deterioration in payment rates may be attributed to
some stress on the consumer. Considering that fragile household balance sheets could be a precipitating factor for the credit cycle to turn, any signs of consumer credit quality deterioration seem worthy of attention.”

Making matters worse, we recently pointed out that low rates had buried Canadian consumers under a mountain of debt, which assures that the adverse impact of the next financial crisis will be substantially magnified. Canadians now collectively owe C$2.16 trillion, which as a share of GDP is the highest debt load in G-7 economies, at just over 100%. At the same time, the housing market is starting to cool in the country and people are “freaking out”, even with rates not far above historical lows, according to Bloomberg. 

Due to low rates, the once financially sound country has found itself on a recent borrowing binge. The country’s ratio of debt to disposable income rose to a record 174% in the fourth quarter, from 148% a decade earlier.

And while nobody dares to exit the party just yet, everyone is waiting to see what happens next. The Bank of Canada has raised rates 5 times since 2017, resulting in current rates of 1.75%. Federal rules put into place have curbed speculation in the housing market. Home values are falling for the first time in three decades. In other words, the chickens could soon be coming home to roost. 

Individual households are also feeling the pain. For instance, the debt service ratio, which measures how much disposable income goes to principal and interest payments, was up to 14.9 in the forth quarter, nearly matching the 2007 record high. 

Meanwhile, in yet another credit red flag, auto loan delinquencies hit 0.97% in the last quarter of 2018, which is the highest number since the aftermath of the 2008 recession. Data is also showing a “pronounced shift” to leasing, as higher rates make it less economical to offer cheap longer term loans. Leases made up 36% of the C$7.85 billion in new auto loans in the fourth quarter, the largest share since before the financial crisis. 

via ZeroHedge News http://bit.ly/2OOOF51 Tyler Durden

Authored by Brandon Smith via Alt-Market.com,

I sometimes think that the free market concept is treated like The Hunchback of Notre-Dame’s Quasimodo in the long novel of global economic history. It is considered ugly and undesirable by most people who judge it at a mere glance without bothering to understand it. It is a bogeyman; a scapegoat for numerous societal problems that it has nothing to do with. In reality, the only time free markets do cause trouble is when they are manipulated or misused by elitists seeking to turn them into something other than free markets. And, even when free markets display their great value and internal beauty, many still prefer other systems that are intrinsically corrupt but flashier on the surface.

There are many reasons behind this persistent attitude. However, they are not coincidental or natural. Human beings actually tend to gravitate toward free markets over and over again in history, and away from centralized government interference and dominance in economic trade. But whenever they do, they get hammered down by the-powers-that-be. In our modern era, establishment elites have chosen to be more subtle (for now) and dissuade people from free markets through disinformation and propaganda.

To break it all down to a simple observation – Whenever disaster strikes economically, free markets are blamed. Whenever something is fixed, even if that fix is a temporary band-aid on a sucking chest wound, government involvement and socialism are applauded. And so the cycle continues until free markets become a pariah with no place in our world and centralization becomes the prevailing answer to everything.

Free market trade is ever present at a local level and always has been. But, those who favor globalism are hell-bent on putting an end to any and all private unregulated commerce forever.

Before the increased lockdown in the 20th century, domestic trade in the U.S. was loosely regulated, if at all. The income tax didn’t exist, except for a trial run during the Civil War which was eventually repealed. There was no permanent central bank managed by unaccountable elites arbitrarily dictating interest rates or inflating the economy through asset purchases. Businesses were formed around partnerships which were limited in their scope, and while government grants and aid were afforded to some of these partnerships (as during the construction of the transcontinental railroad), these grants or bonds had an expiration date set for the moment the job was completed. At that point, the partnerships were dissolved and the company heads were expected to pay back the government on the grants given.

This is not to say that corruption in business did not exist pre-20th century; it certainly did. And in most cases this corruption was fueled by collusion between business moguls and government officials. Without the aid of government (the opposite of free markets) such criminal companies and monopolies cannot exist.

The suppression of free markets began in the aftermath of the Civil War and the passage of the 14th Amendment, which was intended to protect the citizenship rights of former slaves, but was instead used as a legal loophole by the elite to establish what we now know as “corporations”.

Corporations are defined by their corporate charter, which is granted by the government, as well as their “corporate personhood” derived from the exploitation of the 14th Amendment. Corporate personhood allowed for limited liability as well as many other government protections. Unlike partnerships, leaders of corporations cannot in many cases be prosecuted criminally and their personal assets are protected if those crimes were executed by “the company”.  There are exceptions in history, but how often do you see corporate CEO’s prosecuted and suffer anything more than a slap on the wrist?

The company can be sued as a “legal person” in civil court, or fined by the government, but in general CEO’s and major shareholders are protected from any consequences, even if they were directly involved in the commission of a crime.

This relationship between government and corporations has become so egregious that today these monopolies receive special legal protections and immunity from some civil lawsuits, aid in the form of taxpayer funded welfare, massive tax cuts which smaller businesses and less connected corporations do not enjoy, and even central bank bailouts which keep them afloat. Major corporations are not allowed to fail, and no one is allowed to compete with them on a level playing field.

This is the exact antithesis to free markets. This is socialism. Yet many socialists point the finger at free market “capitalism” as the source of all our economic problems. This is impossible, because free markets on a level any higher than local trade do not exist today and have not existed for at least a century.

Another often misrepresented part of the free market mythos is that free markets are amoral creations that must be allowed to evolve without any oversight or conscience. This claim is sometimes made by a subset of people who say they are free market activists, but do not understand free markets in the slightest.

A soulless economic model is not what “Wealth of Nations” writer Adam Smith originally envisioned. Smith was a staunch advocate of an inherent moral compass as a guide for society. He was also highly distrustful of elitist philosophy, and saw it as a control mechanism designed to convince the public that their everyday experiences and instinctual judgments were “inadequate”; meaning, people should set aside their voice of conscience and let the system tell them what they should think and do.

What Smith asserted was that while people often act in their own best interest, they will generally do so while still adhering to a universal moral compass. They will seek success through hard work and endeavor (as they should be allowed to do), but the notion that people will naturally destroy everything and everyone around them in the process unless they are heavily governed is a propaganda argument with no basis in reality. This claim persists today and is still the primary argument used against freedom in trade.

There is a group of people that do behave in a destructive way automatically or instinctually when engaging in commerce without regulation, and these people have become a fascination of mine. They are narcissistic sociopaths; the defining characteristic of most financial and political elites.

I have outlined the facts surrounding narcissistic sociopaths in numerous articles, and I recommend readers study these for greater details. To summarize, full blown narcissistic sociopathy is a psychological aberration present in around 1% of any given population from birth. That is to say, in most cases these people are not created by their environment. Many of them come from very balanced and sheltered childhoods. They are born the way they are.

Narcissistic sociopaths are a tiny portion of the population, but lacking any sense of empathy or conscience, they account for a vast percentage of all crimes committed in society. They also gravitate to positions of power and influence from the business world to politics.

Most of the criticisms of Smith’s model for free markets revolve around the crimes of corporations (which are anti-free market) as well as the immoral behavior of narcissistic sociopaths. When one applies the free market idea to normal people, it works. When one applies it to narcissistic sociopaths, it doesn’t. My question is this – Is the best solution to remove free markets for everyone? Or, is the best solution to remove narcissistic sociopaths from positions of power and influence within free markets?

Establishment elites want us to believe that the former solution is the only solution, and with good reason. All centralization starts with economic centralization. Trade is the lifeblood of civilization, and if you can control the mechanisms of trade, you can potentially control an entire nation, or even the entire world. Free markets are a cure for the cancer of corporatism and socialism, and all they require is that people start participating in commerce without the consent or oversight of government. This is a difficult thing to stop when it gets started.

This is why the establishment is so obsessed with converting to a cashless society in which every transaction no matter how small is tracked and vetted. This is why governments are enacting harsher and harsher penalties for anyone doing business without their explicit approval. This is why government taxation and regulation is making small business ventures more difficult. And, it is why law enforcement officers are being encouraged by bureaucrats to write tickets punishing children selling lemonade on street corners. We are being conditioned to avoid attempting free market trade.

The final and most prolific attack on free markets is the use of the “greater enemy” and the “greater good” as props to undermine positive views of free markets. For example, a common argument against free markets relies on the idea that if people are allowed to pursue commerce unregulated, they would devour the Earth’s resources and destroy it in the process. While we have already seen some of the environmental damage done by the corporatocracy and the sociopathic people that control it, most of these crimes go unpunished despite considerable regulation.

How long have companies like Monsanto operated with impunity under the protection of government? Only recently in civil courts has this company finally had to pay for some of its crimes. But will a single Monsanto CEO or major shareholder go to jail for poisoning the ecosystem or giving people cancer? I doubt it.

The claim of the socialists and environmentalists that more government will save us from bad corporate practices is observably not true. Government and corporations work together to protect their fellow narcissistic sociopaths. More government means more corporate and elitist power. There is not a socialist nation on the planet that has not suffered this outcome.

I agree with Adam Smith in the idea that normal citizens will act to pursue success, but also to pursue balance. When given the opportunity to actually function within a true free market, most people are not going to destroy their surrounding environment and resources in some mad dash for gain. Why? Because it is in their self-interest not to. They know that if they abuse the structures around them they will lose their source of commerce. They know that if they ruin the system for others they will be shunned in business. They also know that if they fail in such a spectacular manner and commit criminal sabotage of the free market system they will have to suffer the regret and shame that will follow.

The only factor that this does not apply to are the elites themselves; the narcissistic sociopaths devoid of conscience with whom we now contend for our freedoms. I would suggest that Smith’s free markets, unshackled from centralization and government interference, would function almost perfectly if these people were cut from the equation entirely.

*  *  *

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via ZeroHedge News http://bit.ly/2K7w5WW Tyler Durden

Just when you thought professional cuddlers had roped in all the easy money just short of prostitution and strip clubs, along comes OneTaste.  

OneTaste is controversial “business” that focuses on a practice that the company calls “orgasmic meditation” (OM). On its website, the company describes “orgasmic meditation” as “a unique wellness practice that combines mindfulness with the power of the deeply human, deeply felt experience of Orgasm” and which Bloomberg describes as “a trademarked procedure that typically involves a man using a gloved, lubricated fingertip to stroke a woman’s clitoris for 15 minutes”

Or in other words, and despite what it may claim otherwise, the company is selling sex. 

Founded in San Francisco (of course), the company is trying to make a business out of selling better orgasms to potential marks customers, focusing mostly on emotionally walled-off women, while allowing nerdy men to finger woman (in exchange for a price). And they’re not just selling videos or brochures – they’re selling interactive classes, where participants are encouraged to learn by doing.  

But the company’s former members, including 16 of them profiled by Bloomberg, highlight the dark side of what some are calling a cult: expensive classes, preying on emotionally vulnerable people and being shunned by group members after leaving. 

Former members spoke anonymously for fear of retribution from the company. Some called the company a “kind of prostitution ring” that would exploit trauma victims and others searching for healing. Some members believed that the company used flirtation and sex to lure in targets that were emotionally vulnerable. It is also accused of having employees be conditioned to work for free and “ordering staffers to have sex or OM with each other”, or customers. 

The company’s classes can range from $199 for an introduction to $4,000 for a retreat, to $16,000 for an “intensive”. The company also started charging $60,000 for an annual membership in 2014. According to the company, about 1,400 people have taken its coaching program, 6,500 have come to an intro class, and more than 14,000 have signed up for online courses and its app.

Confused by what the company really does? Here is Bloomberg:

The company-hosted evening OM circles in Manhattan sometimes held 30 or more pairs of strokers and strokees in one room, the fully clothed men concentrating on their moving fingertips while the women, naked from the waist down, moaned, wailed, and sighed. Afterward, Michal and her co-workers would run that night’s OneTaste event, where they set up chairs, jogged the microphone over to attendees, and chatted up more sales leads. It was exhausting.

One former sales person said: “You fluff someone to get them energetically and emotionally hard. You were the dangled bait, like ‘You can have more of this if you buy this $10,000 course.’ ”

But according to the report, the company gets around this by teaching its practitioners that “money is just an emotional obstacle”. Students also say they were encouraged to take out multiple credit cards to pay for classes. 

“The first time I didn’t cover my credit card bill, it broke something in my mind,” says Ruwan Meepagala, who went to his first OneTaste event in 2012 at age 24, worked for the company for about two years, and left owing $30,000 on his credit cards. “I was no longer afraid of debt,” he says. “Once you break that barrier, $3,000 is the same as $30,000.” At one point, Meepagala complained that he and his co-workers hadn’t been paid in two months; he says he was publicly shamed for having a “scarcity mindset.”

The company denies this characterization, calling it “outrageous”. Chief Executive Officer Joanna Van Vleck said: “OneTaste is the Whole Foods of sexuality—the organic, good-for-you version. The overarching thing is, orgasm is part of wellness.”

They are also trying to lure businesses as clients, exploiting the #MeToo movement as a reason companies should consider their service. 

“We’re having conversations with companies about #MeToo and how to teach connection as preventive health for companies rather than treating the disease of sexual harassment,” Van Vleck said. 

But former members have left feeling worse than when they joined. One former member said, looking back on her time with the company:  “I feel really disgusted that I put myself through that. I felt so much more confused about sex and the boundaries of my body, even though that’s what they say it helps you cultivate.”

Bloomberg also did a video report on its longform article, which you can view here:

via ZeroHedge News http://bit.ly/2TVG9lH Tyler Durden

Authored by EconomicPrism’s MN Gordon, annotated by Acting-Man’s Pater Tenebrarum,

A Growing Gap

The first quarter of 2019 is over and done.  But before we say good riddance.  Some reflection is in order.  To this we offer two discrete metrics.  Gross domestic product and government debt.

US nominal GDP vs total federal debt (in millions of USD) – government debt has exceeded  total economic output for the first time in Q4 2012 and since then its relative growth trajectory has increased – and it seems the gap is set to widen further. [PT]

GDP for the quarter, as estimated by the March 29 update to the New York Fed’s GDP Nowcast, grew at an annualized rate of 1.3 percent.  For perspective, annualized GDP growth of 1.3 percent is akin to getting a 1.3 percent annual raise.  Ask any working stiff, and they’ll tell you… a 1.3 percent raise is effectively nothing.

By comparison, the U.S. budget deficit for fiscal year 2019 is estimated to hit roughly $1.1 trillion.  This amounts to an approximate 5 percent increase of the current $22.2 trillion national debt.  In other words, government debt is increasing about 3.85 times faster than nominal GDP, which is about $21 trillion.

These two metrics offer a rough perspective on the state of the economy.  Deficit spending is grossly outpacing economic growth.  Heavy treatments of fiscal stimulus are being applied.  Yet the economy’s practically running in place.  In short, the state of the economy is not well.

A case of restricted maneuverability…  [PT]

And as the economy slows and then slips into reverse later this year, and as Washington then applies more fiscal stimulus, these two metrics will move even further towards madness.  What’s more, the Fed is gearing up to promote this greater state of madness in any and every way possible…

Indefinite Madness

The Fed confirmed during the first quarter something all honest thinkers have known for about a decade. There really is no viable way to dispose of the government bonds and mortgage securities purchased with the trillions of dollars of fake money conjured into existence as part of quantitative easing.  We are stuck in this state of madness indefinitely – there is no going back.

The Fed’s balance sheet will never be materially reduced.  Quantitative tightening will conclude this year with the balance sheet well over 3.5 times higher than it was a decade ago.  The federal funds rate will never be materially normalized. Financial markets, governments, corporations, industries, individuals, and everything in between, depend on the grease and lard to remain solvent.

Since December, the Fed’s priority has shifted from normalization to maintaining an elevated stock market.  Moreover, when the economy, now close to its longest, yet most anemic expansion in the post-World War II era, rolls over, you can expect the Fed will reintroduce its policies of mass money debasement.

The difference between now and 2008, however, is the Fed will be easing from a place that’s already highly accommodative. Remember, prior to the 2008-09 recession, the federal funds rate was at 5.25 percent and the Fed’s balance sheet was at $900 billion.  Now the federal funds rate is currently close to 2.5 percent and Fed’s balance sheet is about $3.9 trillion.

And the song remains the same…  [PT]

Heading into the next recession the Fed has much less room to maneuver from.  Future quantitative easing could take the Fed’s balance sheet to $10 trillion or more. Plus, with the federal funds rate at just 2.5 percent, the Fed will have to push rates below zero – or negative – to bailout financial markets.

This, no doubt, will take an economy and financial markets that are already extremely distorted and disfigure them beyond all recognition.  But that’s not all.  The Fed will also move to direct asset purchases.  Quantitative easing will likely be expanded to include purchases of corporate debt and the U.S. stock market.

As the Madness Turns

This is the mad world we live in.  A world that will only get madder as policies of desperation are rolled out in earnest to keep the price of money cheap, the price of assets high, and the government swindlers in Washington flush with money borrowed on the backs of the unborn.  But make no mistake, this madness will turn.  First it will turn to fear, then to anger, and then to death…

The crisis coming down the turnpike will collide with a combustible populace that’s grown sick and tired of having its nose rubbed in the mud.  The booming economy reported by the government bureaus over the decade long expansion never showed up in their biweekly paychecks.  The fruits of their labors were consumed by Washington long before they blossomed.

To be clear, the failures of the American worker are not failures of capitalism.  They’re failures of America’s brand of a centrally planned economy.  The dual impediments of fake money and regulatory insanity apply exactions which cannot be overcome.

A glimpse of the future… [PT]

The economy, in other words, has been tilted on end.  The value that workers produce flows to Washington and Wall Street, where it’s misallocated to an army of officials, cronies, and big bankers.  While the mechanics of how this all works are not well understood by the masses, the bitterness that comes with schlepping and slogging to little avail can be articulated by just about everyone.

Alas, solutions, which will be in the form of various promises of free money, will exacerbate problems of too much money.  Scapegoats will be misassigned.  Demigods will be swept to power.  And Mark Zuckerberg – that Facebook geek – will do his part to make tomorrow even less agreeable than today.

via ZeroHedge News http://bit.ly/2FUxAlZ Tyler Durden

Hours after California and 19 other states filed a lawsuit to try and stop President Trump from appropriating funds for his border wall via his national emergency declaration, President Trump flew to Calexico for a press conference with immigration agents and border patrol officials that was tantamount to flipping a giant middle finger to the state’s recently inaugurated, rapidly anti-Trump governor, Gavin Newsom. Not to mention California Attorney General Xavier Becerra, who has repeatedly challenged the Trump administration on immigration-related issues.

Bolstered by a flurry of news stories about the rapidly deteriorating situation at the border, which is being exacerbated by an unprecedented surge in the number of asylum seekers from Central America, Trump declared that at least 400 miles of his promised wall would be built over the next two years, and blamed Democrats for the slow progress so far. Trump has been pushing Congress to tighten asylum rules, to make it harder for migrants to qualify.

Notably, his visit came a day after he withdrew his nominee to lead ICE, the longtime border official Ron Vitiello, who had appeared to be on track for confirmation until Trump decided he wanted to go in a “tougher direction.”

He also repeated his explanation for backing off his threat to close the border, saying that Mexico has been cracking down on migrants traveling through its territory, and reiterated his threat to tariff auto parts and close the border if significant progress hasn’t been made in a year, according to the Associated Press.

During the press conference, Trump shared a message to migrants that he described as “our new statement,” and warned anyone traveling to the US – whether it’s to declare asylum, or enter illegally – to instead “turn around.”

“This is our new statement- the system is full. We can’t take you anymore. Whether it’s asylum or anything you want – illegal immigration – we can’t take you anymore. Our country is full. Our area is full. The sector is full. Can’t take you anymore, I’m sorry. Turn around.”

During the meeting, Trump was presented with a piece of the future border wall.

Unsurprisingly, the president’s visit triggered Gov. Newsom to condemn the president’s efforts to shut down immigration,.

“Since our founding, this country has been a place of refuge – a safe haven for people fleeing tyranny, oppression and violence. His words show a total disregard of the Constitution, our justice system, and what it means to be an American,” said Democratic Gov. Gavin Newsom.

Watch a clip from his speech below:

TRUMP: “This is our new statement- the system is full. We can’t take you anymore. Whether it’s asylum or anything you want – illegal immigration – we can’t take you anymore. Our country is full. Our area is full. The sector is full. Can’t take you anymore, I’m sorry. Turn around” pic.twitter.com/W1Bjnnf7UR

— Aaron Rupar (@atrupar) April 5, 2019

via ZeroHedge News http://bit.ly/2I2Pqqy Tyler Durden

Authored by Charles Hugh Smith via OfTwoMinds blog,

Zombification / Japanification is not success; it is only the last desperate defense of a failing, brittle status quo by doing more of what’s failed.

A recent theme in the financial media is the Japanification of Europe.Japanification refers to a set of economic and financial conditions that have come to characterize Japan’s economy over the past 28 years: persistent stagnation and deflation, a low-growth and low-inflation economy, very loose monetary policy, a central bank that is actively monetizing debt, i.e. creating currency out of thin air to buy government debt and a government which funds “bridges to nowhere” and other stimulus spending to keep the economy from crashing into outright contraction.

The parallels with Europe are obvious, but they don’t stop there: the entire world is veering into a zombified financial, economic, social and political status quo that is the core of Japanification.

While most commentators focus on the economic characteristics of Japanification, social and political stagnation are equally consequential. If we only measure economic/financial stagnation, it appears as if Japan and Europe are holding their own, i.e.maintaining the status quo via near-zero growth and near-zero interest rates.

But if we measure social and political decay, the erosion is undeniable. Here’s one example. Few Americans have access to or watch Japanese TV, so they are unaware of the emergence of the homeless as a permanent feature of urban Japan. The central state propaganda media is focused on encouraging tourism, a rare bright spot in Japan’s moribund economy, and so you won’t find much media coverage of homelessness or other systemic signs of social breakdown.

If you watch Japanese detective / police procedural dramas, however, you’ll find constant references to homeless people and homeless encampments: detectives seek witnesses to a crime in the nearby homeless encampment; a homeless man living in an abandoned warehouse is found murdered, etc.

Here’s the core dynamic of zombification / Japanification: the top 25% are doing whatever is necessary to maintain the status quo because it works well for them, but the system is failing the bottom 75%, who must be politically, socially and economically neutered so they can’t upset the apple cart.

Depending on the economy/society in question, one could argue that it’s the top 40% defending the status quo and disenfranchising the bottom 60%, or it’s the top 20% disenfranchising the bottom 80%. The exact ratio doesn’t matter; what matters is the status quo no longer works for the majority, but they are powerless to change the system because it’s controlled by the minority who benefit so greatly from it being locked in its present setting.

The other dynamic of zombification / Japanification is: past success shackles the power elites to a failed model. The greater the past glory, the stronger its hold on the national identity and the power elites.

And so the power elites do more of what’s failed in increasingly extreme doses. If lowering interest rates sparked secular growth, then the power elites will lower interest rates to zero. When that fails to move the needle, they lower rates below zero, i.e. negative interest rates.

When this too fails to move the needle, they rig statistics to make it appear that all is well. In the immortal words of Mr. Junker, when it becomes serious you have to lie, and it’s now serious all the time.

The necessity of neutering the majority politically, socially and economically manifests in two destructive ways: young people who opt out (or are frozen out) of the failed status quo do not mate and have children, do not buy houses, new cars, etc. This sets off a demographic time bomb that guarantees the implosion of the financial promises made by the self-serving status quo.

This is social depression, and once it is embedded it is essentially impossible to reverse.

Needless to say, if young people no longer have kids and no longer make enough money to buy houses, cars, etc., the economy is doomed to stagnation and decline as old people don’t spend much. That leaves the entire economy’s spending and borrowing on the top 10% who are doing splendidly. But the top 10% cannot hold up the entire economy for long. That fragility is exposed once one of the many rotten props holding up the status quo collapses.

The second option is political upheaval, i.e. populism. When the losers in the winner-take-most economies of the world (and every economy is now winner-take-most once you scrape away the PR and propaganda) have had enough, they take to the streets.

Beating them, shooting them, vilifying them and so on only hardens their resolve to bring the status quo crashing down, regardless of the damage.

Either way, the brittle status quo collapses from either political rebellion or social depression or the fragility that arises from pursuing ever more extreme measures of defending the status quo’s winners at the expense of the many losers.

Zombification / Japanification is not success; it is only the last desperate defense of a failing, brittle status quo by doing more of what’s failed. Japan has perfected the art of managing decline while maintaining the illusion that the status quo is solid and permanent.

In this, the entire global status quo is embracing Zombification / Japanification. By all the usual economic measures–growth, national debt, percentage of tax revenues devoted to interest on the debt, and so on–the status quo can continue to maintain the facade of solidity essentially forever.

Beneath the surface solidity, however, all the buffers are thinning. The great irony of zombification / Japanification is that the success of maintaining the illusions of permanence only masks the increasing fragility of the status quo; it doesn’t actually fix what’s broken or obsolete.

*  *  *

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via ZeroHedge News http://bit.ly/2uPLVuZ Tyler Durden

The Musk meltdown show must go on.

Tesla’s embattled and increasingly erratic CEO Elon Musk may have been involved in a physical confrontation with an employee who had handed in his resignation last September, according to Bloomberg. The incident occurred when the employee, who had resigned, returned to work to say goodbye to his colleagues.

After word had spread that the employee had resigned, Musk accosted the worker, swearing at him and telling him to leave immediately, according to the report. Musk also reportedly made physical contact with the employee in a “heated confrontation that drew the attention of other employees” before spilling out into the hallway and later the parking lot. 

The departing worker, described by his peers as “one of the best problem solvers and a great business mind” (which may explain why Musk felt… challenged) reportedly went to get his backpack prior to leaving, but Musk physically blocked him, telling him to just “get the fuck out“. Musk then confronted him outside, telling the employee “I will nuke you!” if he harmed Tesla. Some speculated that the warning was meant to keep the employee quiet about what had taken place that day.

Musk’s chief of staff ended up returning the backpack to the employee, who then left for the day.

The departing employee told people that Musk had pushed him, while others described it as a tap or a light touch. Either way, the Board of Directors got involved and reviewed the matter, compiling accounts from witnesses. In the end, the board concluded that there – surprise – was “no physical altercation”. They did not address the allegations of verbal abuse.

The worker involved in the incident did not comment for the story, who did not name him or others involved, for fear of retribution from the company. The event reportedly took place at Tesla’s headquarters in Fremont during September of last year, which was a period Musk had referred to as “delivery logistics hell”. 

Word of the incident, which was witnessed by several people, has traveled among current and former Tesla employees, several of whom say they remain afraid of their former boss. While the September incident is an extreme example, it reflects a description of Musk that is notorious among both current staff and the growing diaspora of Tesla alumni: an inspiring but sometimes volatile leader, often driving employees to a breaking point.

To be sure, this wasn’t the first meltdown Musk allegedly suffered during a termination. Earlier in September, Musk confronted another employee, and started yelling at him in front of customers. Another manager, a former army veteran, stepped in to defend the now visibly shaken employee, according to a person familiar with the matter. Musk later announced that the employee had been fired on an internal call attended by dozens of Tesla employees. The company had yet to alert the employee himself of his termination.

As part of its reporting, Bloomberg contacted the board whose job it ultimately is to tame the CEO, which made the following statement:

“It is the board’s responsibility to take seriously any potential issues that come to our attention involving senior executives, no matter how small or how large. In this instance we conducted a thorough review, which proved that there was never a physical altercation, a fact confirmed by multiple people who were present at the time.”

The company said an a statement: “Elon did exit an employee at our Fremont delivery center last year due to concerns about his performance, however there was no physical altercation whatsoever. Those reports are simply untrue as confirmed by numerous people that observed the incident first-hand.”

The report noted that it was not clear who led the investigation on behalf of Tesla’s board, but Twitter seems to have a good guess:

Elon led the investigation. He deemed his own conduct to be immaterial.
First amendment bro.
Case closed.$TSLA $TSLAQ

— TeslaCharts (@TeslaCharts) April 5, 2019

via ZeroHedge News http://bit.ly/2G1DMtz Tyler Durden