iftttwall

Yesterday, in the aftermath of the spectacular collapse of Melvin Capital which only exists because Citadel’s Ken Griffin and Point72’s SAC’s Steve Cohen gave it $2.75BN to pay for a margin call, we speculated that the option heavy, short-focused Maplelane Capital (established in 2010 by a former PM at the disgraced tech-focused hedge fund Galleon) and  was full to the gills with puts on names that had exploded in recent days, could be the next major hedge fund to blow up.

Today, Bloomberg read our article and reported that – as we expected – “Maplelane Capital, a $3.5 billion stock hedge fund, lost about 33% this month through Tuesday in part because of a short position on GameStop Corp., according to investors.”

While we didn’t know the exact number, it’s clear that it would be bad.

What follows is speculation that despite the massive loss, “the firm significantly altered its portfolio in recent weeks, adjusting risk, one of the people said, asking not to be identified because the information isn’t public. Those changes helped protect against further losses, and the firm has no liquidity or margin issues.”

Right… a 33% drop and no liquidity or margin issues, is their Prime Broker the Federal Reserve, or god?.

And even if that is right, we can’t wait to see the inbound redemption request faxes from delighted LPs who just lost a third of their capital which should assure that this particular hedge fund does not reincarnate a third time.

Meanwhile, reporting something we did not know but certainly speculated, Bloomberg also said that Steve Cohen’s $19 billion Point72 Asset Management “lost 10% to 15% so far this month as a growing number of hedge funds tally losses from retail investors’ attacks on popular positions.” And this after Cohen plowed $750MM in Melvin Capital to make sure that his previous investment in his former employee, Gabe Plotkin, wasn’t wiped.

Cohen’s loss underscores the potential for pain to spread after investors using chat rooms and social media set out to target some hedge fund bets. Point72 already had about $1 billion at Melvin, which as of Tuesday had lost more than 30% so far this year.

Yes: one of the most legendary hedge funds on Wall Street, the firm that was the inspiration for “Billions”, lost almost a sixth of its value because of a unprecedented raid by a ragtag band of teenage “autists” who showed the world just how much power and how much damage countless DDOS-type attacks on a handful of hedge funds by millions of individual investors all armed with stimmy checks – who are irrelevant alone but so powerful combined – can do.

So much damage, in fact, that the powers that be found it necessary to first shut down the discord server, and then give them a permanent time out because one more hedge funds – perhaps Steve Cohen himself – complained.

And just like that wallstreetbets has a new enemy pic.twitter.com/WngCRuS67k

— zerohedge (@zerohedge) January 27, 2021

A new audit of California’s Employment Development Department (EDD) finds the agency was unprepared and had ineffective management to handle the surge in jobless claims during the virus pandemic. 

In September, the Joint Legislative Audit Committee ordered State Auditor Elaine Howle to conduct an in-depth audit into EDD following a tidal wave of abuse reports. 

One of the most notable abuses was rapper Fontrell Antonio Baines, 31, who fraudulently collected $1.2 million in EDD claims. He even detailed the EDD scam in a rap video. 

State lawmakers had criticized the agency for massive backlogs that delayed claims, along with its failure to prevent widespread fraud. 

“Although it would be unreasonable to have expected a flawless response to such a historical event, EDD’s inefficient processes and lack of advanced planning led to significant delays in its payment of [unemployment insurance] claims,” Howle’s letter said, which was addressed to the governor and lawmakers. 

Howle found at least half of the claims submitted online to EDD could not automatically process between March and September and were processed manually. 

“As a result, hundreds of thousands of claimants waited longer than 21 days — EDD’s measure of how quickly it should process a claim — to receive their first benefit payments,” Howle said. “EDD has begun to modify its practices and processes to increase the rate at which it automatically processes online claims, but the automation it has gained during the pandemic is not fully sustainable.”

As the backlog soared during the pandemic and internal chaos at EDD erupted, the agency relaxed eligibility rules to speed up claims distribution. This may have resulted in millions of people who shouldn’t have received claims or were overpaid. Now EDD is deciding how these folks will repay the jobless benefits they got during the pandemic.

Around 2.4 million people who received jobless benefits might have been ineligible, and 1.7 might have been overpaid, totaling more than 4 million people might have to repay the state government. 

“That could have significant consequences for claimants,” the audit said.

In December, EDD flagged 12.7 million eligibility issues affecting 2.4 million people. To review the millions of issues, it would take the agency 3 million hours of work to resolve just half of the claims. 

California Labor Secretary Julie Su said this week that the state paid out $11.4 billion in fraudulent claims last year, representing about 10% of the $114 billion in benefits paid since March.

Authored by Jack Phillips via The Epoch Times (emphasis ours)

The Biden administration was sued on Jan. 27 over its executive order to halt oil and gas leasing on federal lands and waters.

The lawsuit (pdf) was filed in the U.S. District Court in Wyoming by the Western Energy Alliance, a group representing fossil fuel producers on federal lands. They say President Joe Biden exceeded his authority with the recent order.

“The law is clear. Presidents don’t have authority to ban leasing on public lands. All Americans own the oil and natural gas beneath public lands, and Congress has directed them to be responsibly developed on their behalf,”  Alliance President Kathleen Sgamma said in a statement, according to The Washington Times. “Drying up new leasing puts future development as well as existing projects at risk. President Biden cannot simply ignore laws in effect for over half a century.”

The executive order, Sgamma said, violates the Mineral Leasing Act, the National Environmental Policy Act, and the Federal Lands Policy and Management Act.

The lawsuit argues that the administration’s suspension of the federal oil and gas leasing program is “an unsupported and unnecessary action that is inconsistent with the Secretary’s statutory obligations” and is “both arbitrary and capricious.”

The Biden executive order sets up a “pause on entering into new oil and natural gas leases on public lands or offshore waters to the extent possible” and will launch a “rigorous review of all existing leasing and permitting practices related to fossil fuel development on public lands and waters,” according to the White House.

The White House said the move is an attempt to “tackle the climate crisis.”

Republicans and industry leaders said the order would harm the U.S. economy and result in thousands of job losses.

Dan Naatz of the Independent Petroleum Association of America said in a separate statement: “Do not be fooled, this is a ban [on drilling]. The Biden administration’s plan to obliterate the jobs of American oil and gas explorers and producers has been on clear display.”

What’s more, according to Sgamma, the order would also put at risk $8.8 billion in conservation revenue that is funded in part by mineral development on federal property.

“Biden’s ban is an overreach meant to satisfy the environmental left, but it would seriously harm the livelihoods of tens of thousands of westerners and put at risk millions more as state services become unfunded,” she said.

The order doesn’t affect existing oil and gas leases, which can last 10 years, officials have said.

The Interior Department stated the pause “won’t impact existing operations or permits for valid, existing leases, which are continuing to be reviewed and approved.”

Republicans in Congress have signaled they will work to stop Biden’s agenda.

“Pie-in-the-sky government mandates and directives that restrict our mining, oil, and gas industries adversely impact our energy security and independence,” Rep. Cathy McMorris Rodgers (R-Wash.), a member of the GOP’s leadership in the House, said in a statement this week.

One-third of people who have had COVID-19 suffer some type of neurological or psychiatric disorder within six months of testing positive for the virus, with one-in-eight receiving their first such diagnosis over the same period, according to a new analysis from the department of psychiatry at Oxford which looked at health records from 236,379 patients.

The analysis, which has yet to be peer-reviewed, compared COVID-19 survivors to a group diagnosed with influenza, and another cohort diagnosed with respiratory tract infections between January 20 and December 13, 2020, according to The Guardian.

Led by Oxford’s Dr. Max Taquet, the analysis accounted for known risk factors such as age, sex, race, underlying physical and mental conditions and socio-economic deprivation. It builds upon prior research from Taquet which revealed that nearly 20% of those with COVID-19 are diagnosed with a psychiatric disorder within three months of testing positive, with 5.8% of those being their first such diagnosis.

Taquet’s new analysis also found that brain disorders were more likely in patients who required hospitalization.

That said, COVID and its ensuing lockdowns have been tough on everyone – with the American Psychiatric Association (APA) reporting last June that there’s been an increase in psychiatric disorders during the pandemic. Early on in the outbreak, both the New York Times and Washington Post noted a rise in anxiety and depression – with one-third of Americans showing signs by late May.

How long might these disorders last? Taquet doesn’t know. “I don’t think we have an answer to that question yet,” he told The Guardian, adding “For diagnoses like a stroke or an intracranial bleed, the risk does tend to decrease quite dramatically within six months … but for a few neurological and psychiatric diagnoses we don’t have the answer about when it’s going to stop.”

The likelihood that a proportion of patients who were given psychiatric or neurological diagnosis after Covid-19 had underlying illness that just hadn’t been diagnosed previously, could not be entirely ruled out – but the analysis indicated that this was not the case, he suggested.

Patients with influenza and other respiratory infections saw their doctor more often than patients with Covid-19, he said, adding that diagnoses such as an intracranial bleed or stroke could not be hidden for long and were usually diagnosed in emergency rooms.

Although the study does not prove that Covid-19 is directly behind these psychiatric and neurological conditions, research that suggests the virus can have an impact on the brain and the central nervous system is emerging. –The Guardian

One caveat – ti is unknown whether a person’s first entry of a diagnosis into the electronic database represents their first occurrence of the condition. Still, the findings are of interest to the medical community.

“I think particularly this raises a few disorders up the list of interests, particularly dementia and psychosis … and pushes a few a bit further down the list of potential importance, including Guillain-Barré syndrome,” said Dr. Tom Nicholson, an unaffiliated psychiatrist and clinical lecturer at King’s College hospital, who added that the findings would help guide researchers towards which neurological and psychiatric complications require further and careful study.