In the Middle of a Pandemic, San Francisco NIMBYs Sue To Stop a New Hospital From Being Built

reason-ucsf

Neighborhood activists in San Francisco are suing to stop the University of California, San Francisco’s (UCSF) plans for an ambitious expansion of the medical center at its Parnassus Heights campus, which would include a new hospital and housing for students and staff.

These neighborhood groups argue in three separate lawsuits that the University California Board of Regents, the governing body of the UC system, failed to properly consider the serious impacts UCSF’s planned expansion would have on housing demand, traffic, air quality, and aesthetics in the surrounding area when it approved those plans last month.

One of these lawsuits—filed Friday in the California Superior Court of Alameda County by the Parnassus Neighborhood Coalition and Haight-Asbury resident Calvin Welch—argues that a 2,100-page environmental impact report on UCSF’s Parnassus expansion should be thrown out, and another analysis be performed that more closely examines the project’s impacts.

“Although the [UCSF] project will cast shadows on Golden Gate Park and the Grattan Playground, result in more than 6,000 bird deaths a year, increase housing demand, and make traffic worse, the [environmental impact report] improperly dismissed all of these impacts as ‘less than significant,'” fumes the Parnassus Neighborhood Coalition on its website.

Two other groups, San Franciscans for Balanced and Livable Communities and the Yerba Buena Neighborhood Consortium, have filed similar lawsuits, reports the San Fransisco Chronicle. 

The Parnassus Neighborhood Coalition lawsuit also argues that UCSF’s expansion plans violate a Board of Regents resolution from 1976 that capped development of the Parnassus campus at 3.5 million gross square feet. UCSF’s planned expansion would bring the campus’s building space up to around 6 million square feet by 2050.

That 1976 resolution was passed under remarkably similar circumstances. At the time, UCSF was moving forward with a plan to modernize a hospital building on its campus and construct a new dental school.

Those plans also raised the ire of neighborhood activists, including Welch, who filed lawsuits to stop these projects and lobbied the state legislature to cut off funding to them, according to his complaint.

In an effort to safeguard its funding, the Board of Regents approved a compromise resolution that placed a number of limits on the campus’s growth, including the aforementioned cap building space. In return, activists agreed to drop their lawsuits and lobbying efforts.

According to the Parnassus Neighborhood Coalition’s complaint, that cap was understood at the time to be permanent.

But 50 years on, UCSF says an expansion of its campus is necessary in light of its growing student and faculty population, the outdated nature of its hospital facilities, and the increased demand for hospital beds.

Each year, UCSF turns away about 3,000 patients for lack of bed capacity, the university said in a press release. One of its existing hospital buildings, the 70-year-old Moffitt Hospital, also doesn’t meet state seismic standards and will have to be decommissioned for inpatient use by 2030, it said.

Nearly half of the additional building space UCSF is looking to add would be taken up by a new hospital building, which would bring with it an additional 200 hospital beds. New on-campus housing would add another 673,000 gross square feet of space and about 762 new units, according to the environmental impact report for the project.

Planning for this major expansion was kickstarted in 2018 after UCSF received a $500 million private donation from the Helen Diller Foundation to help construct a new hospital.

In July 2020, UCSF released a final environmental impact report on the planned expansion, which was then approved by the UC Board of Regents on January 20.

The California Environmental Quality Act (CEQA) requires government agencies like the Board of Regents to perform these kinds of environmental reviews when considering approval of a project.

The CEQA is a citizen-enforced statute, meaning that third parties have the power to sue government agencies if they believe they’ve abused their discretion by approving a project without doing a thorough enough analysis of its significant environmental impacts.

The law, passed in 1970, was originally intended to apply to major state infrastructure projects like a new highway or dam. Subsequent amendments and judicial interpretations have vastly expanded the law’s scope to include even largely pro forma government approvals of privately sponsored projects like a new apartment building or a new burger joint.

The Parnassus Neighborhood Coalition’s lawsuit, which is challenging a state agency’s approval of a public university’s expansion plan, is seemingly closer to the original purpose of the law.

Their petition is nonetheless trying to stop a hospital from modernizing and expanding its facilities on its own property over some very typical NIMBY (“not in my backyard”) concerns, including parking and population growth.

Given the twin housing and health crises faced by the city, maybe it’d be better to let this project proceed without litigation.

from Latest – Reason.com https://ift.tt/2ZMZwTn
via IFTTT

Most Major Retail Brokerages Suffer Outages As ‘Meme Stock’-Mania Continues

Most Major Retail Brokerages Suffer Outages As ‘Meme Stock’-Mania Continues

Downdetector reports customers of E-Trade, TD Ameritrade, Charles Schwab, Robinhood, and Fidelity are experiencing outages and issues 30 minutes into the US cash session on Thursday. This comes as heavily-watched so-called ‘meme stocks’ are higher after yesterday’s late-day gamma squeeze in GME (and AMC, among others).

E-Trade outages and issues were detected around the cash session start. 

The outage map shows E-Trade disruptions are widespread. 

TD Ameritrade users are reporting issues as well. 

The outage map shows TD Ameritrade disruptions are from coast to coast. 

Possible problems were spotted at Charles Schwab. 

Robinhood users are also reporting possible problems with the trading app. 

… and so is Fidelity. 

The resurgence in bullish sentiment towards WSB-Short-Squeeze favorites began Wednesday afternoon, with GameStop doubling in minutes. 

In a virtual conference on Thursday, Morgan Stanley Chief Financial Officer Jonathan Pruzan said the number of trades customers are making daily on the self-directed online trading platform E*Trade is “off the charts.” 

Tyler Durden
Thu, 02/25/2021 – 10:19

via ZeroHedge News https://ift.tt/3ssDbGM Tyler Durden

Pending Home Sales Unexpectedly Plunge In January – Lowest Since July

Pending Home Sales Unexpectedly Plunge In January – Lowest Since July

After sliding for four straight months, analysts expected pending home sales to flatline in January (despite bounces in new– and existing-home sales). But, amid a collapse in mortgage applications (and jump in mortgage rates), pending home sales tumbled 2.8% MoM to the lowest level since July…

Source: Bloomberg

And while pending home sales are up YoY, that acceleration is slowing rapidly…

Source: Bloomberg

“There are simply not enough homes to match the demand on the market” Lawrence Yun, chief economist at the NAR, said in a statement.

Still, Yun said he expects inventory to rise in the coming months.

By region, contract signings fell in the West, Northeast and Midwest. In the South, the index for pending home sales rose to the highest since August.

The tumble in pending home sales should not be a total surprise as mortgage applications crashed by most since April (dropping for 5 of the last 6 weeks)…

Source: Bloomberg

With home purchase applications (as opposed to refis) collapsing to the lowest in 9 months

Source: Bloomberg

As 30Y mortgage rates rise to their highest since September

Source: Bloomberg

Get back to work Mr.Powell!

Tyler Durden
Thu, 02/25/2021 – 10:07

via ZeroHedge News https://ift.tt/3dJ32pN Tyler Durden

GME Gamma Squeeze Round 2: Here’s What Happened (& What Happens Next)

GME Gamma Squeeze Round 2: Here’s What Happened (& What Happens Next)

Via SpotGamma.com,

Yesterday GME saw another massive price move with the stock ripping over 100% from $45 up over $200 in after hours trading. 

[ZH: It was not just GME that surged]

This move was likely fueled by an options gamma squeeze as we’ll explain here.

First, note the existing options positions in GME, from the day prior to yesterdays squeeze (Tuesday, 2/23). There was a large concentrated put position as highlighted in red box below. Call options in decent size were also spread from 40 up all the way into the 500 strikes (green box). This infers that as the stock started to lift off, all of those put positions started to bleed in value, which may have allowed market makers to reduce their short stock position. As the stock lifted higher all of those preexisting call positions start to pick up in value, requiring additional long stock hedges. In other words the “pump was primed” for a gamma squeeze.

From the days start there was fairly strong “bullish” options flow which picked up in spades after 1pm. This chart portrays the initial hedging requirement due to new options trades (delta hedge). Recall that as the stock moves higher, more stock must be purchased to re-hedge (gamma hedge).

We’ve indicated where the bulk of these options flows picked up in the GME price chart below.

The net result of the new options positions from Wednesday, and GME stock price jump is that the center of options hedging activity (ie large gamma strike) has shifted from 45 to 95. This indicates that major hedging flows will now be tied to that level, which could set up as support. Its important to note that these options price levels shift daily.

GME Prices: Looking Ahead

It is likely to be a challenge for GME to reach & sustain similar price heights as before (>$200). The main reason for this is that we think options market makers are going to be much faster to raise the price of options. The primary method options market makers have of deterring option buyers is to raise the costs of options, which should start to limit demand. This in turn may mean that marker makers risk and hedging requirements declines.

During the last price jump the cost of options (i.e. implied volatility) rose to very high rates, but it did not seem to deter call buying. This demand was primary to the initial options gamma squeeze, as we detailed in our previous analysis. Yesterday though options prices rose dramatically, surging past relative levels from similar GME price jumps.

You can see this below, where we show the cost of at the money option (left axis). Each dot represents a different expiration date, with an option strike equal to where the stock last traded. The thin blue line shows the price of GME stock (right axis). Last night with GME stock closing near $100, the cost of an option was nearly 3x that of the last time GME was near $100.

This similar chart below shows the options in implied volatility terms, and you can see that the cost of call options (blue dots) rose well past that of put options (orange dots).

If call sellers begin to show up in earnest, that can allow the market makers to sell long stock hedges. We believe this was a strong reason as to why GME stock dropped from >$200 down to $60.

The mechanics of this trade our outlined here: The GME Gamma Trap.

Tyler Durden
Thu, 02/25/2021 – 09:46

via ZeroHedge News https://ift.tt/3aRFP2U Tyler Durden

Explosive CIA Report Blaming MbS For Khashoggi Murder To Be Released Today

Explosive CIA Report Blaming MbS For Khashoggi Murder To Be Released Today

It comes as no surprise that an explosive CIA report on the 2018 killing of journalist Jamal Khashoggi inside the Saudi consulate in Istanbul is expected to identify Crown Prince Mohammed bin Salman as the main culprit who ordered the hit.

It’s expected to be released to the public later in the day Thursday, Reuters first reported based on multiple admin officials, which is likely to mark a low-point in US-Saudi relations after Biden has promised to get tough on Riyadh.

“The officials said the report, for which the CIA was the main contributor, assessed that the crown prince approved and likely ordered the murder of Khashoggi, whose Washington Post column had criticized the crown prince’s policies,” Reuters reports.

NBC underscores that “its public release will mark a significant new chapter in the U.S.-Saudi relationship and a clear break by President Joe Biden with former President Donald Trump’s policy of equivocating about the Saudi state’s role in a brutal murder that was widely condemned by members of Congress, journalists and a U.N. investigator.”

White House press secretary Jen Psaki confirmed on Wednesday that the previously classified investigation’s findings is set to be released imminently. “The president confirmed to reporters late Wednesday that he had read the report,” NBC notes further.

Officially the report was compiled by the US Office of the Director of National Intelligence (ODNI) based mostly on the earlier CIA findings from its 2018 inquiry. 

President Biden is expected to hold his first official phone call with the Saudis, after which the report will be made public. Crucially, the phone call will be held with King Salman bin Abdulaziz Al Saud and not the kingdom’s de facto ruler MbS.

The White House is soon expected to also release the readout of that call with the king.

Biden will reportedly convey to the king the findings of the intel report – something that will no doubt prove deeply awkward and embarrassing for the kingdom and which will possibly once again keep MbS away from public venues and events for a while (similar to the way he was treated essentially as persona non grata by world leaders in the year after Khashoggi’s murder).

Tyler Durden
Thu, 02/25/2021 – 09:30

via ZeroHedge News https://ift.tt/3sEwdyP Tyler Durden

On Elite Campuses Like Smith College, Woke Students Have All the Power

Pierce_Hall_-_Smith_College_-_Northampton,_MA_-_DSC02114

During the summer of 2018, a Facebook post by a black Smith College student named Oumou Kanoute went viral. Smith recounted being harassed by a college janitor and police officer who had accused her of trespassing while eating inside a dormitory lounge. The incident left her shaken and frightened—in Kanoute’s telling, she was persecuted for the crime of “eating while black.”

The Washington Post and The New York Times both covered her story, and the American Civil Liberties Union (ACLU) came to her assistance. As a result of the attention brought to the situation, many of the employees involved—particularly the janitor and a cafeteria worker who had spoken with Kanoute—were publicly branded racists and subjected to extreme opprobrium. Kanoute eventually received a formal apology from Smith College’s president, Kathleen McCartney.

“This painful incident reminds us of the ongoing legacy of racism and bias in which people of color are targeted while simply going about the business of their ordinary lives,” said McCartney in a public statement.

Yesterday, the Times revisited the story, adding some key details. It turns out that Kanoute was trespassing: The dormitory in which she ate lunch was closed to students for the summer. Only children attending a summer camp were allowed to use the building’s cafeteria. The janitor who approached Kanoute—a nearsighted man in his 60s—had every reason to call security, and the officer who showed up apologized for bothering the student. Contrary to Kanoute’s claim that she thought her life might be in danger, the officer was quite unarmed.

According to the Times, Smith commissioned a report on the incident, and that report

cleared Ms. Blair altogether and found no sufficient evidence of discrimination by anyone else involved, including the janitor who called campus police.

Still, Ms. McCartney said the report validated Ms. Kanoute’s lived experience, notably the fear she felt at the sight of the police officer. “I suspect many of you will conclude, as did I,” she wrote, “it is impossible to rule out the potential role of implicit racial bias.”

The report said Ms. Kanoute could not point to anything that supported the claim she made on Facebook of a yearlong “pattern of discrimination.”

Ms. McCartney offered no public apology to the employees after the report was released. “We were gobsmacked — four people’s lives wrecked, two were employees of more than 35 years and no apology,” said Tracey Putnam Culver, a Smith graduate who recently retired from the college’s facilities management department. “How do you rationalize that?”

Rahsaan Hall, racial justice director for the A.C.L.U. of Massachusetts and Ms. Kanoute’s lawyer, cautioned against drawing too much from the investigative report, as subconscious bias is difficult to prove. Nor was he particularly sympathetic to the accused workers.

“It’s troubling that people are more offended by being called racist than by the actual racism in our society,” he said. “Allegations of being racist, even getting direct mailers in their mailbox, is not on par with the consequences of actual racism.”

The revelation that the entire narrative surrounding the incident was a lie has not changed matters one bit at Smith. Employees must now undergo rigorous anti-bias training. Faculty are exempt from these sessions, but they are encouraged to attend “white accountability” Zoom groups, in which they are supposed to interrogate their prejudices.

The Times story is worth reading in full, because it’s a welcome instance of the mainstream media giving much-needed attention to the phenomenon of ostensibly progressive (though considerably privileged) college students weaponizing false claims of racism or sexism to punish ordinary, innocent people who irked them. It’s a tactic that is spreading from elite college campuses to elite media institutions—like the Times itself—which disproportionately hire graduates of places like Smith. And it’s spreading still. As Andrew Sullivan once observed, “We all live on campus now.”


FREE MINDS

Amazon is no longer carrying When Harry Became Sally, a socially conservative take on transgenderism by Ryan Anderson, president of the Ethics and Public Policy Center. Amazon has not offered an explanation, but appears to have recently crafted a policy against “content that we determine is hate speech,” according to The Washington Free Beacon.

As a private bookseller, Amazon is not required to stock its virtual shelves with any particular tome. But refusing to sell Anderson’s book will prompt understandable charges of rank hypocrisy. Prime users can currently order Mein Kampf and have it delivered in 48 hours.


FREE MARKETS

The White House is still backing former Center for American Progress President Neera Tanden to head the Office of Management and Budget, but Senate Democrats are postponing committee votes on her nomination. According to Reuters:

Biden, a Democrat, still supports Tanden, an Indian American who would be the first woman of color to lead the agency.

“Neera Tanden is a leading policy expert who brings critical qualifications to the table during this time of unprecedented crisis,” his press secretary, Jen Psaki, wrote on Twitter.

Asked later at the White House whether Tanden had offered to withdraw her nomination, Psaki said: “That’s not the stage we’re in.”


QUICK HITS

• The Conservative Political Action Conference (CPAC) begins today, and former President Donald Trump is slated to speak on Sunday. Rep. Liz Cheney (R–Wy.), who voted to impeach the president, thinks Trump should not continue to play a role in the Republican Party’s activities, but she seems to be vastly outnumbered.

• Hillary Clinton is writing a thriller.

Mercia Bowser, elder sister of Washington, D.C., Mayor Muriel Bowser, has died of COVID-19.

• New York Gov. Andrew Cuomo is facing his own #MeToo scandal.

• Fans of Frasier and Avatar: The Last Airbender have reasons to celebrate.

from Latest – Reason.com https://ift.tt/3bydRsc
via IFTTT

On Elite Campuses Like Smith College, Woke Students Have All the Power

Pierce_Hall_-_Smith_College_-_Northampton,_MA_-_DSC02114

During the summer of 2018, a Facebook post by a black Smith College student named Oumou Kanoute went viral. Smith recounted being harassed by a college janitor and police officer who had accused her of trespassing while eating inside a dormitory lounge. The incident left her shaken and frightened—in Kanoute’s telling, she was persecuted for the crime of “eating while black.”

The Washington Post and The New York Times both covered her story, and the American Civil Liberties Union (ACLU) came to her assistance. As a result of the attention brought to the situation, many of the employees involved—particularly the janitor and a cafeteria worker who had spoken with Kanoute—were publicly branded racists and subjected to extreme opprobrium. Kanoute eventually received a formal apology from Smith College’s president, Kathleen McCartney.

“This painful incident reminds us of the ongoing legacy of racism and bias in which people of color are targeted while simply going about the business of their ordinary lives,” said McCartney in a public statement.

Yesterday, the Times revisited the story, adding some key details. It turns out that Kanoute was trespassing: The dormitory in which she ate lunch was closed to students for the summer. Only children attending a summer camp were allowed to use the building’s cafeteria. The janitor who approached Kanoute—a nearsighted man in his 60s—had every reason to call security, and the officer who showed up apologized for bothering the student. Contrary to Kanoute’s claim that she thought her life might be in danger, the officer was quite unarmed.

According to the Times, Smith commissioned a report on the incident, and that report

cleared Ms. Blair altogether and found no sufficient evidence of discrimination by anyone else involved, including the janitor who called campus police.

Still, Ms. McCartney said the report validated Ms. Kanoute’s lived experience, notably the fear she felt at the sight of the police officer. “I suspect many of you will conclude, as did I,” she wrote, “it is impossible to rule out the potential role of implicit racial bias.”

The report said Ms. Kanoute could not point to anything that supported the claim she made on Facebook of a yearlong “pattern of discrimination.”

Ms. McCartney offered no public apology to the employees after the report was released. “We were gobsmacked — four people’s lives wrecked, two were employees of more than 35 years and no apology,” said Tracey Putnam Culver, a Smith graduate who recently retired from the college’s facilities management department. “How do you rationalize that?”

Rahsaan Hall, racial justice director for the A.C.L.U. of Massachusetts and Ms. Kanoute’s lawyer, cautioned against drawing too much from the investigative report, as subconscious bias is difficult to prove. Nor was he particularly sympathetic to the accused workers.

“It’s troubling that people are more offended by being called racist than by the actual racism in our society,” he said. “Allegations of being racist, even getting direct mailers in their mailbox, is not on par with the consequences of actual racism.”

The revelation that the entire narrative surrounding the incident was a lie has not changed matters one bit at Smith. Employees must now undergo rigorous anti-bias training. Faculty are exempt from these sessions, but they are encouraged to attend “white accountability” Zoom groups, in which they are supposed to interrogate their prejudices.

The Times story is worth reading in full, because it’s a welcome instance of the mainstream media giving much-needed attention to the phenomenon of ostensibly progressive (though considerably privileged) college students weaponizing false claims of racism or sexism to punish ordinary, innocent people who irked them. It’s a tactic that is spreading from elite college campuses to elite media institutions—like the Times itself—which disproportionately hire graduates of places like Smith. And it’s spreading still. As Andrew Sullivan once observed, “We all live on campus now.”


FREE MINDS

Amazon is no longer carrying When Harry Became Sally, a socially conservative take on transgenderism by Ryan Anderson, president of the Ethics and Public Policy Center. Amazon has not offered an explanation, but appears to have recently crafted a policy against “content that we determine is hate speech,” according to The Washington Free Beacon.

As a private bookseller, Amazon is not required to stock its virtual shelves with any particular tome. But refusing to sell Anderson’s book will prompt understandable charges of rank hypocrisy. Prime users can currently order Mein Kampf and have it delivered in 48 hours.


FREE MARKETS

The White House is still backing former Center for American Progress President Neera Tanden to head the Office of Management and Budget, but Senate Democrats are postponing committee votes on her nomination. According to Reuters:

Biden, a Democrat, still supports Tanden, an Indian American who would be the first woman of color to lead the agency.

“Neera Tanden is a leading policy expert who brings critical qualifications to the table during this time of unprecedented crisis,” his press secretary, Jen Psaki, wrote on Twitter.

Asked later at the White House whether Tanden had offered to withdraw her nomination, Psaki said: “That’s not the stage we’re in.”


QUICK HITS

• The Conservative Political Action Conference (CPAC) begins today, and former President Donald Trump is slated to speak on Sunday. Rep. Liz Cheney (R–Wy.), who voted to impeach the president, thinks Trump should not continue to play a role in the Republican Party’s activities, but she seems to be vastly outnumbered.

• Hillary Clinton is writing a thriller.

Mercia Bowser, elder sister of Washington, D.C., Mayor Muriel Bowser, has died of COVID-19.

• New York Gov. Andrew Cuomo is facing his own #MeToo scandal.

• Fans of Frasier and Avatar: The Last Airbender have reasons to celebrate.

from Latest – Reason.com https://ift.tt/3bydRsc
via IFTTT

The Law Of Unintended Conse-Kiwi-Nces

The Law Of Unintended Conse-Kiwi-Nces

By Michael Every of Rabobank

Allow me to focus on just New Zealand today as the perfect illustration of the law of unintended market conse-Kiwi-nces.

The RBNZ left rates on hold at 0.25% as expected, but that’s not the real story. To tell it, let’s rewind. NZ was, not that long ago, a highly-regulated economy that focused almost exclusively on exporting its lovely agri output to the UK. Then the UK made a geopolitical pivot to join the EU and its common agricultural policy, and NZ was left adrift. The country suffered a massive economic shock; had to reinvent itself; and reinvent itself it did, with a market-friendly, Asia-focused export economy. The first law of unintended conse-Kiwi-nces is that geopolitics is swinging back in the other direction, or at least as far as the EU and UK, and a pre-1973-style export focus on China is concerned.

As part of its market reforms, and after the high and variable inflation of the 1970s, which followed on the back of both the end of Bretton Woods in 1971, the oil shock of 1973, and the UK joining the EU, there was a search for a new policy direction. Neoliberal monetarism was very much in vogue, and in 1984 the RBNZ adopted inflation targeting as the focus of monetary policy, the first to do so. As part of the broader financial reforms introduced, a series of variable reserve requirement ratios and interest rate controls, to try to limit how credit flowed, and FX controls, to prevent international flows to circumvent the former, were all removed. The NZD dropped sharply, floated freely, and we entered the policy framework we see in most major economies today.

There was an immediate spike in Kiwi inflation in the 1980s. As then usual, this was taken as a signal for the wage round – and yet under this new neoliberal framework, it fell on deaf ears. While arguably necessary at the time as part of restructuring and transition towards the macrostability inflation targeting likes to flag as its ultimate reward, this was the first clear indication that wages/labour were always going to come second to business/capital/exports in this brave new world. How else was inflation to be kept in check?

As we all now know from the global experiment with this system, this power imbalance within the economic structure –which presents itself as natural, sensible, and entirely ‘neutral’– ultimately requires workers to borrow more and more to sustain the level of consumption they would have previously enjoyed via wage growth. We also now know that this means asset bubble after asset bubble, usually of housing; and when these burst, the system can only respond with even more liquidity, which exacerbates the problem rather than acting as any kind of counterbalance for the underlying root cause. So the second law of unintended conse-Kiwi-nces is that socio-economic AND macro stability are ultimately undermined if you focus on inflation and ignore the political economy. Which is part of the reason why geopolitics is shifting so uncomfortably for NZ.

Yes, some central banks have a dual inflation and employment remit: the RBNZ had one added too. Yet in the US this was historically ignored in favour of inflation; and now that the zeitgeist has shifted, that dual mandate in both the US and NZ is being used as an excuse to let inflation —which actually means asset prices!— run hot. So where is this mythical balance? That there isn’t just underlines that without addressing the taboo issue of labour vs. capital, which involves undoing much of the labour market deregulation of the past, central banks still can’t resolve the real problem: and so (geo)politics shifts even faster.

So here we today, and the Kiwi government has just told the RBNZ that from now on it must also “consider housing” in its interest rate and financial policy decisions, aiming at keeping them “sustainable”. The RBNZ of course considers risks to housing in terms of financial stability, but not whether the prices are sustainable (or affordable to voters) or not. Naturally, the RBNZ welcomes this decision. But what will it mean? With housing prices soaring again in NZ, as everywhere, and homelessness a political issue for the government, this logically must point to one of three policy outcomes:

  • First, nothing happens. As with full employment promises, it’s just neoliberal window dressing. That would get politically difficult at some point, one would imagine;
  • Second, rates have to rise despite other parts of the economy still suffering, underlining how inefficient the central rates tool is when trying to target activity across a variety of different sectors in a globalized economy. This suggestion has helped see NZD soar, now up 4% in just a week! That means potentially higher mortgage payments AND a far less competitive currency for those farmers already having to consider what exporting alternatives might need to be available in a worst-case Australia-style scenario. Fortunately, high commodity prices, which the US central bank is more than partly responsible for, are providing some kind of cushion to Kiwi farmers for now in a law of unintended(?) conseq-US-nces; or
  • Third, major macroprudential measures to allow for ultra-low rates but to stop liquidity flowing to housing. This has been tried to some degree before, but current house prices tell you if it’s worked or not (hint: they are no more affordable/”sustainable” vs. wages).

I would remind regular readers that this last point is not too far removed from the idea floated just days ago – that if you want ultra-easy monetary policy for a long time without bubbles, one is going to have to use de facto credit rationing. Is the RBNZ a market thought leader here again too, but in reverse? Probably not, because then you also have to deal with capital flows to stop foreigners buying Kiwi houses, which takes us all the way back to the pre-1984 Kiwi economy again.

Indeed, the final law of unintended conse-Kiwi-nces is that neoliberalism saw a shift from an economy too geopolitically fixed on one large power, in need of macroeconomic adjustment, and with an overvalued exchange rate, to an economy too geopolitically fixed on one large power, in need of macroeconomic adjustment, and with an overvalued exchange rate. Yes, it’s far richer today: but due to asset prices, not wages. Or, putting it differently, the only logical way to deal with the underlying problem seems to be bringing back elements of the pre-neoliberal regulatory policies that were dumped 40 years ago.

In the meantime, let the NZD and the neoliberal easy money rip: and ‘good as gold,’ as they say in NZ.

Tyler Durden
Thu, 02/25/2021 – 09:16

via ZeroHedge News https://ift.tt/2O0Dl9C Tyler Durden

‘Meme Stock’-Mania Accelerates Pre-Market

‘Meme Stock’-Mania Accelerates Pre-Market

Several heavily-watched so-called ‘meme stocks’ are higher in the pre-market after yesterday’s late-day gamma squeeze in GME (and AMC among others).

The resurgence in bullish sentiment towards several of the WSB-Short-Squeeze favorites is extreme…

GME is up over 70% in the pre-market

AMC is up 15-20% in the pre-market…

Pot stocks (also notably discussed on Reddit) are also bid with Sundial Growers up over 10%…

Given the surge in implied vols and the chaos into the close last night, we wonder how much knock-on effect this latest short-squeeze will have on hedge funds (and if there will be a need to delever once again)?

Tyler Durden
Thu, 02/25/2021 – 09:07

via ZeroHedge News https://ift.tt/37MNsWo Tyler Durden

First-Time Jobless-Benefits Seekers Plunge To COVID-Crisis Lows Amid Collapse In CA,OH Claims

First-Time Jobless-Benefits Seekers Plunge To COVID-Crisis Lows Amid Collapse In CA,OH Claims

After disappointingly rising the prior week, analysts expected initial jobless claims to shrink modestly last week but remain above 800k (825k exp) for the seventh straight week. However, the data was better, much better, with first-time claimants plunging to just 730k (against a 825k exp) – back near its lowest levels since pre-COVID…

Source: Bloomberg

The plunge in claims was driven by a somewhat unprecedented collapse in claims in California and Ohio…

But Pandemic Emergency Claims soared to post-COVID record highs…

Source: Bloomberg

Leaving the total number of Americans on government unemployment benefits higher, back above 19 million last week

Source: Bloomberg

So there’s something for everyone here – Good news (initial claims down), Bad news (total claimants higher), and Ugly news (pandemic claims at a record highs)

Tyler Durden
Thu, 02/25/2021 – 08:54

via ZeroHedge News https://ift.tt/3bwmrYg Tyler Durden