“Death To Liars!” Iran Swept By Wave Of Protests Demanding Ayatollah Quit Over Airplane Downing

“Death To Liars!” Iran Swept By Wave Of Protests Demanding Ayatollah Quit Over Airplane Downing

Mass protests have again broken out in Iran at the end of a chaotic week for the country, capped by the early Saturday admission and apology for the military accidentally shooting down a Ukrainian passenger plane, killing all 176 people on board. 

Additionally, it appears that the British ambassador in Tehran, Rob Macaire, was arrested shortly after photographing the protests. Iranian state sources are alleging he was helping to “organize” and incite the protests.

The UK ambassador to Iran Rob Macaire has been arrested during the protests in Tehran on Saturday, Iran’s semi-official Tasnim news agency reported.

Macaire was present during the Saturday protests in front of Tehran’s Amir Kabir University and was arrested then, Tasnim’s report said.

Though he’s reportedly already been released, the incident is likely to spark a major diplomatic row between the UK and Iran, given it’s almost unheard of to arrest a country’s highest diplomatic official. 

Mourning turns to protests in Tehran. Image via AFP. 

In the first major protests since the Jan.2 US assassination of IRGC Quds Force chief Qasem Soleimani, angry student-led demonstrations broke out in front of Tehran’s Amir Kabir university demanding that Iran’s leaders, including Ayatollah Khamenei step down over their initially concealing the truth about the airline downing. 

“Commander-in-chief [Khamenei] resign, resign!” videos posted to Twitter showed Saturday. 

However, their size in the hundreds paled in comparison with prior anti-government protests in the tens of thousands last November across multiple cities, which actually saw possibly hundreds killed in clashes with police which often involved live gunfire to put down the crowds by security forces. 

In a rarity, Iranian state media also acknowledged the new anti-government unrest fueled by news that it was Iran’s Revolutionary Guards which shot down the passenger jet, and not “mechanical failure” as was initially claimed.

As Reuters describes of the semi-official Fars report: 

The report said the demonstrators on the street also ripped up pictures of Qassem Soleimani, the prominent commander of the Guard’s Quds Force who was killed in a U.S. drone strike.

The agency, widely seen as close to the Guards, carried pictures of the gathering and a torn banner of Soleimani. It said the protesters numbered about 700 to 1,000 people.

Video also showed moments where police rushed in to attempt to quash the growing protests, which could turn into bigger demonstrations Sunday.

One regional report cited an Iranian protester’s grievances as follows:

“They were so careful not to kill any American in their revenge for Soleimani. But they did not close the airport? This shows how much this regime cares for Iranians,” said Iranian citizen Mira Sedaghati after the Iranian military admitted mistakenly shooting down the jet.

It also appears Iran’s significant political opposition in exile is seizing on the dramatic events of this week, with exiled Persian Crown Prince Reza Pahlavi issuing a statement on Saturday saying, “This is not human error. This is a crime against humanity.”

He added in the Twitter statement: “He who has irresponsibly empowered his thugs to fire at will at innocents bears full responsibility. Enough is Enough. Khamenei and his regime must go.”

“Vigils that were held near Amir Kabir University quickly turned into anti-government protests with people calling for the IRGC to leave the country,” an Al Jazeera correspondent reported from the scene. 

Meanwhile, following Iran’s rare apology which included Iranian Foreign Affairs Minister Mohammad Javad Zarif saying on Twitter that “human error at time of crisis caused by US adventurism led to disaster,” Ukraine’s President Zelenksy issued a stern rebuke of Iran’s handling of the crisis.

“The morning was not good today but it brought along the truth,” Zelensky said in a written statement early Saturday morning.

“But we insist on the full acceptance of guilt. We expect Iran to pledge readiness to carry out a full and open investigation, to prosecute those responsible, to return the bodies of the dead, to pay compensations, to extend official apologies via diplomatic channels,” the Ukrainian president wrote.

Among the many Iranians killed were also 11 Ukrainians as well as 63 people from Canada.

US Secretary of State Mike Pompeo has already seized on the protests, tweeting they were a sign that the Iranian people “are fed up with the regime’s lies, corruption, ineptitude and brutality”.


Tyler Durden

Sat, 01/11/2020 – 16:30

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Institutions, Retail And Algos Are Now All-In, Just As Buybacks Tumble

Institutions, Retail And Algos Are Now All-In, Just As Buybacks Tumble

When it comes to gauging market euphoria, one place to find the current state of retail investor (super) sentiment, is the CNN Fear and Greed Index, which over the past three weeks, has printed at all time series highs.

What about institutional sentiment? Well, contrary to several goalseeked indicators which erroneously repeat week after week that whales and other prominent institutional traders remain “on the fence” despite the now daily record highs in the S&P, the truth is that virtually everyone is now all in: from simple human-driven discretionary, to macro funds, all the way to algo and CTAs. In fact, as Deutsche Bank’s Parag Thatte writes in his weekly flow report, “positioning in equities has been rising and is now in the 96th percentile on our consolidated measure, with a wide variety of metrics very stretched.” And, as we have noted previously, equity flows as well as “equity positioning, like the market itself, has run far ahead of current growth as investors price in a global growth rebound.“

But while it has been known for a while that most humans have thrown in the towel amid a mauling of bears and shorts, it now appears that systematic strategies – i.e., algos, quants, risk parity, etc – have also raised equity exposure to the top of its range. According to Thatte, the equity allocations for Vol Control, CTAs, and Risk Parity are all near a historical maximum, which means that algos are now effectively all in.

Some more details:

  • Vol Control: Vol Control funds are near their maximum equity allocations for more than 2 months now. 1M SPX  realized volatility has been sub-10% since November without >1% daily moves in more than 2 months. VIX was also seasonally low this past December. Sustained low volatility environment helped VC funds maintain their high equity exposure through the recent flare-up in geopolitical risk.

Selling pressure from VC on a 3% pullback in SPX now stands at ~ $7bn-$8bn, while DB’s aggregate volatility metric targeted by VC funds is close to 10% and stands near the bottom end of its past 10Y range. And here a warning from Thatte: with barely any upside bid left, the downside risk from VCs is higher at this stage of the market rally.

  • Risk Parity funds: Risk parity have scaled their SPX exposure back up to near record levels. A near uniform uptrend in equities, coupled with low equity volatility and bonds moving sideways, have boosted RP exposure to equities. Extended period of low RV likely prompted relatively slow moving RP funds to steadily increase their equity allocation over the past month. In addition, moderating negative returns correlation between bonds and equities have seen this equity exposure increase occur at the expense of exposure to bonds. Bond volatility remains relatively elevated despite trending lower over the past month. Indicative RP bond exposure is now back near March 2019, leaving limited upside for further higher equity exposure and lower bond exposure.

  • CTAs: CTA equity exposure increased with the upward trending markets to near peak levels. Recent momentum in US equities have been uniformly strong across short and medium term signals, translating to a higher level of confidence in the latest uptrend. CTA exposure to EM equities also shows up as heavy with spot reaching back to 1Q18 levels. Bond positioning by CTAs have steadily moved lower and reached their 1Y lows. The cuts in bond exposure have been across most regions, especially in Japan where 10Y JGB yields have almost turned positive.

In this context, it is hardly surprisingly that the Deutsche strategist observes that the only other time that systematic strategy positioning was higher was in January 2018… just before the large February selloff.

And yet, unlike Feb 2018, a vol spike like the one observed in Feb 2018 may not be enough to trigger a market crash. The reason: vol control funds are usually the first to sell equities when vol rises, but with volatility having been subdued for an extended period of time, they would need to see a large and sustained spike in vol for their selling thresholds to be hit.

Still, while algos are only now rush to go balls to the wall, they are only now catching up to discretionary investors who have steadily raised their bullish positioning since August and are now clearly overweight in DB’s reading, and exposure is at the highest levels since October 2018. Discretionary positioning typically follows growth indicators closely but since September, it has diverged and has moved sharply higher even as growth is yet to rebound (instead, it appears that positioning is merely chasing the broader market which has soared on the back of the Fed’s QE4 which was launched to “fix” the repo market after JPMorgan broke it). Active mutual funds as well as retail investors have raised exposure following the strong market rally.

However, there is one place where the euphoria has yet to go off the chart: the popularly followed beta positioning for long-short hedge funds still remains very low, and in line with subdued growth indicators.

Finally, several indicators point to stretched positioning across other metrics. For example, equity futures long positioning for asset managers and leveraged funds combined is at record highs, driven by a broad-based rise in longs across the S&P 500 and Nasdaq as well as the small-cap Russell 2000 futures. 

Longs in EM futures have risen to record highs.

Call/put volume ratios are at the top of their historical range;

And short interest in single stocks is near record lows; and that in ETFs has also fallen to a new low.

One last confirmation of what appears to be a bullish capitulation into the QE4-inspired melt up is that equity fund flows have also turned up strongly over the last 3 months. Almost $50bn came in over this period, compared with over -$300bn in outflows in the prior 10 months.

Oh, one more thing we almost forget: with institutions, retail investors and algos all in stocks, the biggest source of equity demand, corporations themselves, appear to be easing off the stock buyback pedal. Indeed, awhile there has been a flurry of recent buyback announcements…

… with tech names leading by the runner up, healthcare, by nearly 3 to 1 in buyback announcements…

… in the grand scheme of things, and on a rolling 3 month basis, stock buybacks are a far cry from where there were just two years ago, and fading fast to levels not seen since before the Trump tax reform which unleashed a $1.5 trillion buyback bonanza.

It is this sudden reversal in buyback appetite that may be the biggest danger for a market where 77% of CFOs now think the market is significantly overvalued.


Tyler Durden

Sat, 01/11/2020 – 16:04

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Everything You Need To Know About Recessions (But Were Afraid To Ask)

Everything You Need To Know About Recessions (But Were Afraid To Ask)

Authored by Nicholas LePan via VisualCapitalist.com,

Just like in life, markets go through peaks and valleys. The good news for investors is that often the peaks ascend to far greater heights than the depths of the valleys.

Today’s post helps to put recessions into perspective. It draws information from Capital Group to break down the frequency of economic expansions and recessions in modern U.S. history, while also showing their typical impact.

What is a Recession?

Not all recessions are the same. Some can last long while others are short. Some create lasting effects, while others are quickly forgotten. Some cripple entire economies, while others are much more targeted, impacting specific sectors within the economy.

Recession is when your neighbor loses their job. Depression is when you lose yours.

– Harry Truman

According to the National Bureau of Economic Research, a recession can be described as a significant decline in economic activity over an extended period of time, typically several months.

In the average recession, gross domestic product (GDP) is not the only thing shrinking—incomes, employment, industrial production, and retail sales tend to shrink as well. Economists generally consider two consecutive quarters of declining GDP as a recession.

The general economic model of a recession is that when unemployment rises, consumers are more likely to save than spend. This places pressure on businesses that rely on consumers’ income. As a result, company earnings and stock prices decline, which can fuel a negative cycle of economic decline and negative expectations of returns.

During economic recoveries and expansions, the opposite occurs. Rising employment encourages consumer spending, which bolsters corporate profits and stock market returns.

How Long Do Recessions Last?

Recessions generally do not last very long. According to Capital Group’s analysis of 10 cycles since 1950, the average length of a recession is 11 months, although they have ranged from eight to 18 months over the period of analysis.

Jobs losses and business closures are dramatic in the short term, though equity investments in the stock market have generally fared better. Throughout the history of economics, recessions have been relatively small blips.

Over the last 65 years, the U.S. has been in an official recession for less than 15% of all months. In addition, the overall economic impact of most recessions is relatively small. The average expansion increased GDP by 24%, whereas the average recession decreased GDP by less than 2%.

In fact, equity returns can be positive throughout a contraction, since some of the strongest stock rallies have occurred in the later stages of a recession.

Buying the Dip: Recession Indicators

Whether you are an investor or not, it would be wise to pay attention to potential recessions and prepare accordingly.

There are several indicators that people can watch to anticipate a potential recession, which might give them an edge in preparing their portfolios:

This is not a magic rubric for anticipating every economic downturn, but it helps individuals see the weather patterns on the horizon. Whether and where the storm hits is another question.


Tyler Durden

Sat, 01/11/2020 – 15:30

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Trump Admin Looking To Significantly Expand Travel Ban: Report

Trump Admin Looking To Significantly Expand Travel Ban: Report

The Trump administration is considering a dramatic expansion of its highly-controversial travel ban to add several countries to the list, according to the Associated Press, citing ‘six people familiar with the deliberations’ and a ‘document outlining the plans’ which has been circulating within the White House.

According to two of AP‘s sources, seven new countries are under consideration. Of note, the most recent iteration of the travel ban includes Iran, Libya, Somalia, Syria, Yemen, Venezuela and North Korea.

A different person said the expansion could include several countries that were covered in the first iteration of Trump’s ban, but later removed amid rounds of contentious litigation. Iraq, Sudan and Chad, for instance, had originally been affected by the order, which the Supreme Court upheld in a 5-4 vote after the administration released a watered-down version intended to withstand legal scrutiny.

…

The countries on the proposed expansion list include allies that fall short on certain security measures. The additional restrictions were proposed by Department of Homeland Security officials following a review of security protocols and “identity management” for about 200 countries, according to the person. –AP

While Trump’s critics have framed this as a ‘Muslim ban’ due to the fact that affected countries are Muslim majority, many have noted that the travel ban in its original form would have affected fewer than 15% of Muslims worldwide.

“I have trouble understanding why we’re supposed to infer religious animus when in fact the vast majority of Muslims would not be affected,” noted appeals court Judge Richard Clifton in 2017, who also pointed out that the seven countries included in the original travel ban came from a list created by the Obama administration.

While the White House wouldn’t confirm the plan, spokesman Hogan Gidley praised the travel ban for making America safer.

“The Travel Ban has been very successful in protecting our Country and raising the security baseline around the world,” he said in a statement. “While there are no new announcements at this time, common-sense and national security both dictate that if a country wants to fully participate in U.S. immigration programs, they should also comply with all security and counter-terrorism measures — because we do not want to import terrorism or any other national security threat into the United States.”

According to AP, some of their sources said they expect the announcement to coincide with the third anniversary of Trump’s initial January, 2017 travel ban – which former adviser Steve Bannon is largely credited with conceiving. The order resulted in widespread protests across the country, while activist judges struck down the Executive Order shortly thereafter.

The current ban suspends immigrant and non-immigrant visas to applicants from the affected countries, but it allows exceptions, including for students and those who have established “significant contacts” in the U.S.. And it represents a significant softening from Trump’s initial order, which had suspended travel from Iraq, Iran, Libya, Somalia, Sudan and Yemen for 90 days, blocked refugee admissions for 120 days and suspended travel from Syria.

That order was immediately blocked by the courts, prompting a months-long effort by the administration to develop clear standards and federal review processes to try to withstand legal muster. Under the current system, restrictions are targeted at countries the Department of Homeland Security says fail to share sufficient information with the U.S. or haven’t taken necessary security precautions, such as issuing electronic passports with biometric information and sharing information about travelers’ terror-related and criminal histories. –AP

Under the current travel ban, Cabinet secretaries are required to update the presidennt whether countries are adhering to new immigration security benchmarks – with those who fail to comply risking new restrictions, while countries who become compliant can have their restrictions lifted.


Tyler Durden

Sat, 01/11/2020 – 15:00

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Babson College Adjunct Professor & Administrator Fired for Facebook Post

The Foundation for Individual Rights in Education is quite right, I think, to criticize Babson College’s reaction:

The professor’s post was a response to President Trump’s tweeted threat to target 52 Iranian sites, including cultural sites — a threat that drew criticism and eventual disavowal following commentary that the threat, if carried out, would constitute a war crime….

It strains credulity to read Phansey’s post as sincerely advocating violence. In political rhetoric, figurative and hyperbolic language have been familiar tools for centuries, and Phansey’s post is quite obviously a criticism — not endorsement — of threats of violence, mixed with snark about American culture.

For argument’s sake, even after stripping Phansey’s post of its obvious intent, it still does not amount to unprotected speech. As we explained in a letter FIRE sent to Babson president Stephen Spinelli this afternoon, Phansey’s post simply cannot be characterized as either a “true threat” or “incitement,” which are not considered protected speech:

First, because the statement does not purport to commit Phansey to any action, it cannot amount to “a serious expression of an intent to commit an act of unlawful violence[.]” Virginia v. Black, 538 U.S. at 359. Second, the “particular … group of individuals” identified in Phansey’s post—the Kardashians and Mall of America—reveal the sardonic tone, depriving the post of the “serious” nature necessary to remove it from its default status as protected speech.

Second, Phansey’s post is better analyzed under the incitement standard, as it (if read literally, and deprived of its context) purports to call upon Iran to issue a threat to attack particular American cultural institutions in response to President Trump’s threat. Yet even if the post had sincerely encouraged Iran to attack the United States, “mere advocacy of the use of force or violence does not remove speech from the protection of the First Amendment.” Claiborne Hardware Co., 458 U.S. at 927 (emphasis in original). To amount to incitement, the speech would not only advocate unlawful force, but must also be “likely to incite or produce” imminent lawless action. Brandenburg, 395 U.S. at 447. Simply put, there is no reasonable likelihood that Phansey’s private post to his Facebook friends would lead to Iran threatening to bomb the Kardashians’ residence.

And while Babson College is a private institution, and thus not bound by the First Amendment, it does promise its faculty and students that Babson College will respect their freedom of expression. We know that from its faculty handbook, which adopts the AAUP’s 1940 Statement of Principles, under which extramural statements such as these are insufficient to justify terminating faculty members. We also know it from other statements in its student policies, on its website, and from our experience in defending conservative students who faced punishment for celebrating Trump’s 2016 election. In that case, Babson ultimately protected freedom of expression. But not this time.

While some might prefer that faculty and students speak only in sober, considered tones, freedom of expression embraces “the right to criticize public men and measures—and that means not only informed and responsible criticism, but the freedom to speak foolishly and without moderation.” It certainly embraces a right to criticize our President.

Babson’s process-free departure from its stated commitments threatens to do far more damage to its reputation than a momentary social media storm ever could. To save its good name, the college should reinstate Phansey immediately.

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Virginia Legislator Joe Morrissey Gets Called “Fool,” Sues, Arguing He’s Not a Fool

[Part of the argument from plaintiff’s opposition to the motion to dismiss (though see below for more):]

Viewed in context and as a whole, the following statements alleged in Plaintiff’s complaint are actionable:

[1.] “During the past couple of years, Richmond has made national news and international news as a cool place to live, to visit, to play and party. Now we’re making national news because of this fool?”

A “fool” is someone who is lacking in judgment or prudence, a harmlessly deranged person or one lacking in common powers of understanding. Plaintiff is not a fool. In truth, he is a learned man, who majored in Economics and minored in Chemistry at the University of Virginia; who received his law degree from Georgetown University; who received a Master in Laws degree from Trinity College in Ireland, and; who has won over 250 criminal jury trials.

[* * *]

In Morrissey v. WTVR, LLC, decided Thursday by Judge Henry E. Hudson (E.D. Va.), Joe Morrissey—a former Virginia legislator, a disbarred lawyer, and now a Virginia state senator (who just assumed office Wednesday)—sued a Richmond TV station over commentary by reporter Mark Holmberg; the commentary had been aired while Morrissey was unsuccessfully running for Richmond mayor. Here are some key parts of the analysis (as usual in excerpts I post, some paragraph breaks added, and moved text marked with curly braces):

The setting of this lawsuit is a commentary aired on September 2, 2016 by a CBS 6 reporter entitled “Richmond’s Mayor Morrissey?” According to the Complaint, the commentary was republished online in an article with the headline “Holmberg: OMG: Sextin’ Joe Morrissey is leading the mayor’s race!” Morrissey contends that during the broadcast, Holmberg falsely stated, “During the past couple of years, Richmond has made national news and international news as a cool place to live, to visit, to play and party. Now we’re making national news because of this fool?” Morrissey characterizes this allegedly false statement as “the product of spite, ill-will, and an overt desire to discredit and destroy Joe’s reputation for being extremely intelligent.”

The next comment at issue concerns Morrissey’s son. The Complaint alleges that

“Holmberg intentionally spliced together Joe’s comments regarding his son, Chase, and Holmberg’s statement that Joe was ‘lying’, to make it appear that Joe was ‘lying’ about being Chase’s father. During the interview, Joe stated, ‘do you think for a moment if that child [Chase] is mine, I would run from that? Not—not going to happen.'”

At this point, after airing a clip of the prior interview, Morrissey alleges that Holmberg stated, “He was lying to me then. He’s lied to the investigators and everybody else in this case. That’s why the state bar is coming after him, again.” Morrissey maintains that this portion of the presentation was an intentionally spliced clip of the interview and that his “accusation that Joe lied is malicious, spiteful, the product of ill-will, and is an overt attempt to discredit and destroy Joe’s reputation for honesty and integrity.” Morrissey added in his Complaint that “at the time of the on air ‘interview’, there was no evidence that the Virginia State Bar was ‘coming after Morrissey again.'”

Morrissey next contends that Holmberg’s statement that Morrissey “famously and stupidly published a plan[t]ation style ‘Gone with the Wind’ photo of himself and his wife” was defamatory. Morrissey alleges that Holmberg’s statements “evince a clear hatred of [him] with clear racial implications.”

Finally, Morrissey draws the Court’s attention to Holmberg’s concluding comment: “Do we really want to elect this clown, this nonstop, one ring circus, this liar? Or do we want to elect somebody that’s gonna lift us up to the heights that Richmond so richly deserves?” Morrissey contends that “[t]hese false accusations impute to Joe dishonesty, a lack of intelligence, lack of character, lack of sincerity and resolution to perform the duties of Mayor and imply that Joe is unfit to be Mayor of the City of Richmond.” {[Morrissey] describes Holmberg’s remarks as imputing his unfitness to serve as mayor and portraying him as a “stupid liar, who was a sex crazed maniac.”}

The district court dismissed the complaint, reasoning:

[1.] Holmberg’s commentary would be clearly understood as commentary, rather than an interview of Morrissey, and is (as a matter of law) not libelous. Among other things, as the opinion later reasons,

[To be actionable, statements must] have “a provably false factual connotation and thus [be] capable of being proven true or false.” “[T]he verifiability of the statement in question [is] a minimum threshold issue.” “When a statement is relative in nature and depends largely on a speaker’s viewpoint, that statement is an expression of opinion.”

Aside from being nonfactual, much of the commentary at issue is tame in light of the tenor of contemporary political debate. This is particularly true of such amorphous terms as “fool,” “famously and stupidly,” “this clown, this nonstop, one ring circus, this liar.” While such language may be insulting and derogatory, it does not have the requisite defamatory sting. When public figures enter the political arena, they have voluntarily exposed themselves to increased risks from defamatory falsehood concerning them.

[2.] Some of the allegations, the court concludes, are substantially factual, or at least not said knowing they were false or likely false:

[A]n opinion issued by the Supreme Court of Virginia in 2019 affirming a lower court’s revocation of Morrissey’s license to practice law … appears to confirm a factual basis for much of Holmberg’s commentary. The Supreme Court of Virginia’s opinion supported allegations that Morrissey had been convicted of contributing to the delinquency of a minor by engaging in a sexual relationship with a juvenile female and made false statements concerning their relationship. The court also noted Morrissey’s “long and notorious book” of disciplinary history with the State Bar….

Morrissey alleges that Holmberg’s characterization of the Virginia State Bar’s investigation of his conduct is false and defamatory. According to the Complaint, Holmberg said the following: “He was lying to me then. He’s lied to the investigators and everybody else in this case. That’s why the state bar is coming after him, again.” … Morrissey, through counsel, contends that either directly or by implication the comment accuses him of what could be construed to be a criminal offense. However, a careful reading of the Supreme Court of Virginia’s opinion in Morrissey v. Virginia State Bar provides some factual basis for Holmberg’s comments. The deception noted by Holmberg appears to evolve from Morrissey’s conviction for contributing to the delinquency of a minor. The Court’s opinion states that

“Morrissey testified that he was not aware of [the young lady’s] actual age. At the hearing, he pointed to, among other things, the fact that she listed an incorrect birthdate on her job application…. The Bar produced ample evidence that Morrissey actually knew [the young lady] was a minor…. The bar points out that Morrissey, in fact, knew [the young lady’s] true age, [she] was an employee subject to his supervision, Morrissey engaged in sexual relations with her in his law office, and then he bragged about it. The Bar argues that Morrissey should have been ‘guiding associates and law firm staff in in the ethical practice of law. Instead, his misconduct shows a lack of judgment and clear disregard for the rule of law.’ …

“In January 2015, after the entry of Morrissey’s Alford plea, a special prosecutor brought additional charges of felony uttering a forged public record, felony conspiracy to utter a forged record, felony inducing perjury, and perjury. The Bar referred to these charges as ‘Morrissey II.’ The charges stemmed from the allegation that Morrissey had employed a forged court order during the hearing on Morrissey’s Alford plea. The circuit court dismissed the indictments in Morrissey II on the basis that the immunity provision of Morrissey’s plea agreement foreclosed this additional prosecution….”

With respect to Holmberg’s statement, “[t]hat’s why the state bar is coming after him, again,” the Supreme Court of Virginia’s opinion in Morrissey v. Virginia State Bar shows a reasonable factual basis for Holmberg’s opinion. In 2015, following the dismissal of the charges pending against Morrissey in the Henrico County Circuit Court, “the Virginia State Bar began its investigation and issued subpoenas duces tecum to four of [Morrissey’s] criminal defense attorneys.” “On March 24, 2016, at a hearing before the Henrico County Circuit Court, [Morrissey] agreed to turn over his attorneys’ files to the VSB, omitting nothing.”

Clearly, a reporter with access to public records could reasonably conclude that Morrissey was under investigation by the Virginia State Bar at the time of the commentary at issue—and that the investigation included making false statements in connection with the accusations against him…. “[I]n the context of the actual malice inquiry, a duty to investigate the accuracy of one’s statements does not arise until the publisher of those statements has a high degree of subjective awareness of their probable falsity.”

[3.] As to “Morrissey’s publication of what Holmberg characterized as a “plantation style ‘Gone with the Wind’ photo of himself and his wife,'”

Morrissey alleges that “[i]n fact, Joe’s wife is African-American. Again, Holmberg’s statements evince a clear hatred of Joe with clear racial implications.” Morrissey denies publishing a “plantation style photo” to anyone.

Morrissey contends that Holmberg’s characterization, coupled with his display of the photo, portrayed a defamatory implication of racism. However, the apparent import of Holmberg’s display of the photo was to demonstrate his view of Morrissey’s judgment. As with any political commentary, a reader could draw a defamatory inference if they were so inclined, but nothing said by Holmberg necessarily kindled a suggestion of racism.

Defamatory implication is not analogous to psychoanalytical free association in which a therapist asks a person to freely share anything that comes to mind—i.e., what does this image remind you of? To state a plausible claim, the defamatory implication must be firmly moored to the allegedly defamatory language or image.

“[A]llegedly defamatory words are to be taken in their plain and natural meaning and to be understood by courts and juries as other people would understand them, and according to the sense in which they appear to have been used.” The words accompanying Holmberg’s display of the photograph neither support a reasonable implication of racist overtone, as Morrissey contends, nor an actionable claim of defamation.

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Central Bankers Are Quietly Freaking Out About How To Fight The Next Recession

Central Bankers Are Quietly Freaking Out About How To Fight The Next Recession

Authored by Pedro Nicolai da Costavia Forbes.com,

The world’s top central bank officials are rightly concerned that politicians in rich economies missed one key lesson of the last recession: Interest rate cuts can help to moderate a downturn, but aggressive fiscal policy is key to a healthy recovery. 

It was a pro-austerity stance both in the United States, and even more saliently in the euro zone, that arguably prolonged the period of high unemployment and low wage growth that plagued most of the decade-long recovery from the 2007-2009 U.S. Great Recession. 

Outgoing Bank of England Governor Mark Carney told the Financial Times this week that central banks are running low on fuel.

 “If there were to be a deeper downturn, [that requires] more stimulus than a conventional recession, then it’s not clear that monetary policy would have sufficient space,” he said.

Today In: Money

“It’s generally true that there’s much less ammunition for all the major central banks than they previously had and I’m of the opinion that this situation will persist for some time.”  

That echoed the sentiment of Christine Lagarde, who recently took over the European Central Bank. She’s telling budget-shy European politicians (especially in Germany) to get to work.

Now, a new paper from Fed board economist Michael Kiley points to similar alarm among U.S. central bankers about their ability to fight future slumps. 

U.S. interest rates likely to go negative in a recession scenario, FEDERAL RESERVE BOARD

Drawing up two basic assumptions of what a downturn might look like, Kiley finds that “a recession may result in near-zero interest rates at long maturities, bringing U.S. experience closer to that seen in Europe and Japan.”

This, says Kiley, “could imply limits on the ability of monetary policy to support a recovery.”


Tyler Durden

Sat, 01/11/2020 – 14:30

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Babson College Adjunct Professor & Administrator Fired for Facebook Post

The Foundation for Individual Rights in Education is quite right, I think, to criticize Babson College’s reaction:

The professor’s post was a response to President Trump’s tweeted threat to target 52 Iranian sites, including cultural sites — a threat that drew criticism and eventual disavowal following commentary that the threat, if carried out, would constitute a war crime….

It strains credulity to read Phansey’s post as sincerely advocating violence. In political rhetoric, figurative and hyperbolic language have been familiar tools for centuries, and Phansey’s post is quite obviously a criticism — not endorsement — of threats of violence, mixed with snark about American culture.

For argument’s sake, even after stripping Phansey’s post of its obvious intent, it still does not amount to unprotected speech. As we explained in a letter FIRE sent to Babson president Stephen Spinelli this afternoon, Phansey’s post simply cannot be characterized as either a “true threat” or “incitement,” which are not considered protected speech:

First, because the statement does not purport to commit Phansey to any action, it cannot amount to “a serious expression of an intent to commit an act of unlawful violence[.]” Virginia v. Black, 538 U.S. at 359. Second, the “particular … group of individuals” identified in Phansey’s post—the Kardashians and Mall of America—reveal the sardonic tone, depriving the post of the “serious” nature necessary to remove it from its default status as protected speech.

Second, Phansey’s post is better analyzed under the incitement standard, as it (if read literally, and deprived of its context) purports to call upon Iran to issue a threat to attack particular American cultural institutions in response to President Trump’s threat. Yet even if the post had sincerely encouraged Iran to attack the United States, “mere advocacy of the use of force or violence does not remove speech from the protection of the First Amendment.” Claiborne Hardware Co., 458 U.S. at 927 (emphasis in original). To amount to incitement, the speech would not only advocate unlawful force, but must also be “likely to incite or produce” imminent lawless action. Brandenburg, 395 U.S. at 447. Simply put, there is no reasonable likelihood that Phansey’s private post to his Facebook friends would lead to Iran threatening to bomb the Kardashians’ residence.

And while Babson College is a private institution, and thus not bound by the First Amendment, it does promise its faculty and students that Babson College will respect their freedom of expression. We know that from its faculty handbook, which adopts the AAUP’s 1940 Statement of Principles, under which extramural statements such as these are insufficient to justify terminating faculty members. We also know it from other statements in its student policies, on its website, and from our experience in defending conservative students who faced punishment for celebrating Trump’s 2016 election. In that case, Babson ultimately protected freedom of expression. But not this time.

While some might prefer that faculty and students speak only in sober, considered tones, freedom of expression embraces “the right to criticize public men and measures—and that means not only informed and responsible criticism, but the freedom to speak foolishly and without moderation.” It certainly embraces a right to criticize our President.

Babson’s process-free departure from its stated commitments threatens to do far more damage to its reputation than a momentary social media storm ever could. To save its good name, the college should reinstate Phansey immediately.

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Virginia Legislator Joe Morrissey Gets Called “Fool,” Sues, Arguing He’s Not a Fool

[Part of the argument from plaintiff’s opposition to the motion to dismiss (though see below for more):]

Viewed in context and as a whole, the following statements alleged in Plaintiff’s complaint are actionable:

[1.] “During the past couple of years, Richmond has made national news and international news as a cool place to live, to visit, to play and party. Now we’re making national news because of this fool?”

A “fool” is someone who is lacking in judgment or prudence, a harmlessly deranged person or one lacking in common powers of understanding. Plaintiff is not a fool. In truth, he is a learned man, who majored in Economics and minored in Chemistry at the University of Virginia; who received his law degree from Georgetown University; who received a Master in Laws degree from Trinity College in Ireland, and; who has won over 250 criminal jury trials.

[* * *]

In Morrissey v. WTVR, LLC, decided Thursday by Judge Henry E. Hudson (E.D. Va.), Joe Morrissey—a former Virginia legislator, a disbarred lawyer, and now a Virginia state senator (who just assumed office Wednesday)—sued a Richmond TV station over commentary by reporter Mark Holmberg; the commentary had been aired while Morrissey was unsuccessfully running for Richmond mayor. Here are some key parts of the analysis (as usual in excerpts I post, some paragraph breaks added, and moved text marked with curly braces):

The setting of this lawsuit is a commentary aired on September 2, 2016 by a CBS 6 reporter entitled “Richmond’s Mayor Morrissey?” According to the Complaint, the commentary was republished online in an article with the headline “Holmberg: OMG: Sextin’ Joe Morrissey is leading the mayor’s race!” Morrissey contends that during the broadcast, Holmberg falsely stated, “During the past couple of years, Richmond has made national news and international news as a cool place to live, to visit, to play and party. Now we’re making national news because of this fool?” Morrissey characterizes this allegedly false statement as “the product of spite, ill-will, and an overt desire to discredit and destroy Joe’s reputation for being extremely intelligent.”

The next comment at issue concerns Morrissey’s son. The Complaint alleges that

“Holmberg intentionally spliced together Joe’s comments regarding his son, Chase, and Holmberg’s statement that Joe was ‘lying’, to make it appear that Joe was ‘lying’ about being Chase’s father. During the interview, Joe stated, ‘do you think for a moment if that child [Chase] is mine, I would run from that? Not—not going to happen.'”

At this point, after airing a clip of the prior interview, Morrissey alleges that Holmberg stated, “He was lying to me then. He’s lied to the investigators and everybody else in this case. That’s why the state bar is coming after him, again.” Morrissey maintains that this portion of the presentation was an intentionally spliced clip of the interview and that his “accusation that Joe lied is malicious, spiteful, the product of ill-will, and is an overt attempt to discredit and destroy Joe’s reputation for honesty and integrity.” Morrissey added in his Complaint that “at the time of the on air ‘interview’, there was no evidence that the Virginia State Bar was ‘coming after Morrissey again.'”

Morrissey next contends that Holmberg’s statement that Morrissey “famously and stupidly published a plan[t]ation style ‘Gone with the Wind’ photo of himself and his wife” was defamatory. Morrissey alleges that Holmberg’s statements “evince a clear hatred of [him] with clear racial implications.”

Finally, Morrissey draws the Court’s attention to Holmberg’s concluding comment: “Do we really want to elect this clown, this nonstop, one ring circus, this liar? Or do we want to elect somebody that’s gonna lift us up to the heights that Richmond so richly deserves?” Morrissey contends that “[t]hese false accusations impute to Joe dishonesty, a lack of intelligence, lack of character, lack of sincerity and resolution to perform the duties of Mayor and imply that Joe is unfit to be Mayor of the City of Richmond.” {[Morrissey] describes Holmberg’s remarks as imputing his unfitness to serve as mayor and portraying him as a “stupid liar, who was a sex crazed maniac.”}

The district court dismissed the complaint, reasoning:

[1.] Holmberg’s commentary would be clearly understood as commentary, rather than an interview of Morrissey, and is (as a matter of law) not libelous. Among other things, as the opinion later reasons,

[To be actionable, statements must] have “a provably false factual connotation and thus [be] capable of being proven true or false.” “[T]he verifiability of the statement in question [is] a minimum threshold issue.” “When a statement is relative in nature and depends largely on a speaker’s viewpoint, that statement is an expression of opinion.”

Aside from being nonfactual, much of the commentary at issue is tame in light of the tenor of contemporary political debate. This is particularly true of such amorphous terms as “fool,” “famously and stupidly,” “this clown, this nonstop, one ring circus, this liar.” While such language may be insulting and derogatory, it does not have the requisite defamatory sting. When public figures enter the political arena, they have voluntarily exposed themselves to increased risks from defamatory falsehood concerning them.

[2.] Some of the allegations, the court concludes, are substantially factual, or at least not said knowing they were false or likely false:

[A]n opinion issued by the Supreme Court of Virginia in 2019 affirming a lower court’s revocation of Morrissey’s license to practice law … appears to confirm a factual basis for much of Holmberg’s commentary. The Supreme Court of Virginia’s opinion supported allegations that Morrissey had been convicted of contributing to the delinquency of a minor by engaging in a sexual relationship with a juvenile female and made false statements concerning their relationship. The court also noted Morrissey’s “long and notorious book” of disciplinary history with the State Bar….

Morrissey alleges that Holmberg’s characterization of the Virginia State Bar’s investigation of his conduct is false and defamatory. According to the Complaint, Holmberg said the following: “He was lying to me then. He’s lied to the investigators and everybody else in this case. That’s why the state bar is coming after him, again.” … Morrissey, through counsel, contends that either directly or by implication the comment accuses him of what could be construed to be a criminal offense. However, a careful reading of the Supreme Court of Virginia’s opinion in Morrissey v. Virginia State Bar provides some factual basis for Holmberg’s comments. The deception noted by Holmberg appears to evolve from Morrissey’s conviction for contributing to the delinquency of a minor. The Court’s opinion states that

“Morrissey testified that he was not aware of [the young lady’s] actual age. At the hearing, he pointed to, among other things, the fact that she listed an incorrect birthdate on her job application…. The Bar produced ample evidence that Morrissey actually knew [the young lady] was a minor…. The bar points out that Morrissey, in fact, knew [the young lady’s] true age, [she] was an employee subject to his supervision, Morrissey engaged in sexual relations with her in his law office, and then he bragged about it. The Bar argues that Morrissey should have been ‘guiding associates and law firm staff in in the ethical practice of law. Instead, his misconduct shows a lack of judgment and clear disregard for the rule of law.’ …

“In January 2015, after the entry of Morrissey’s Alford plea, a special prosecutor brought additional charges of felony uttering a forged public record, felony conspiracy to utter a forged record, felony inducing perjury, and perjury. The Bar referred to these charges as ‘Morrissey II.’ The charges stemmed from the allegation that Morrissey had employed a forged court order during the hearing on Morrissey’s Alford plea. The circuit court dismissed the indictments in Morrissey II on the basis that the immunity provision of Morrissey’s plea agreement foreclosed this additional prosecution….”

With respect to Holmberg’s statement, “[t]hat’s why the state bar is coming after him, again,” the Supreme Court of Virginia’s opinion in Morrissey v. Virginia State Bar shows a reasonable factual basis for Holmberg’s opinion. In 2015, following the dismissal of the charges pending against Morrissey in the Henrico County Circuit Court, “the Virginia State Bar began its investigation and issued subpoenas duces tecum to four of [Morrissey’s] criminal defense attorneys.” “On March 24, 2016, at a hearing before the Henrico County Circuit Court, [Morrissey] agreed to turn over his attorneys’ files to the VSB, omitting nothing.”

Clearly, a reporter with access to public records could reasonably conclude that Morrissey was under investigation by the Virginia State Bar at the time of the commentary at issue—and that the investigation included making false statements in connection with the accusations against him…. “[I]n the context of the actual malice inquiry, a duty to investigate the accuracy of one’s statements does not arise until the publisher of those statements has a high degree of subjective awareness of their probable falsity.”

[3.] As to “Morrissey’s publication of what Holmberg characterized as a “plantation style ‘Gone with the Wind’ photo of himself and his wife,'”

Morrissey alleges that “[i]n fact, Joe’s wife is African-American. Again, Holmberg’s statements evince a clear hatred of Joe with clear racial implications.” Morrissey denies publishing a “plantation style photo” to anyone.

Morrissey contends that Holmberg’s characterization, coupled with his display of the photo, portrayed a defamatory implication of racism. However, the apparent import of Holmberg’s display of the photo was to demonstrate his view of Morrissey’s judgment. As with any political commentary, a reader could draw a defamatory inference if they were so inclined, but nothing said by Holmberg necessarily kindled a suggestion of racism.

Defamatory implication is not analogous to psychoanalytical free association in which a therapist asks a person to freely share anything that comes to mind—i.e., what does this image remind you of? To state a plausible claim, the defamatory implication must be firmly moored to the allegedly defamatory language or image.

“[A]llegedly defamatory words are to be taken in their plain and natural meaning and to be understood by courts and juries as other people would understand them, and according to the sense in which they appear to have been used.” The words accompanying Holmberg’s display of the photograph neither support a reasonable implication of racist overtone, as Morrissey contends, nor an actionable claim of defamation.

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US Tried (And Failed) To Kill Soleimani’s “Guy On The Ground In Yemen”

US Tried (And Failed) To Kill Soleimani’s “Guy On The Ground In Yemen”

Reaching the end of an insane and astounding week of Iran events, with the latest revelation being Iran’s admission and apology for accidentally shooting down a Ukrainian passenger jet amid its retaliation for Qasem Soleimani’s death, The Washington Post has revealed another bombshell involving a separate failed covert assassination attempt.

On very day of the US drone strike on Baghdad International Airport which took out Soleimani and his convoy, which included Iraq’s top paramilitary commander Abu Mahdi al-Mohandes, a separate but parallel operation was taking place in Yemen at the same time against a “top financier and key commander in Iran’s elite Quds Force who has been active in Yemen,” per the Post’s description.

US officials now say they also attempted to kill Islamic Revolutionary Guard commander Gen. Abdul Reza Shahlai on the same day (Jan.2), but failed. “The highly classified mission against Abdul Reza Shahlai in Yemen shows that recent U.S. operations against Iran were more ambitious and multifaceted than the air strike last week that the Trump administration said it undertook to kill Maj. Gen. Qassem Soleimani in Baghdad,” writes the WSJ. 

Ahmed Reza Shahali, an Iranian military official targeted for assassination, has a $15 million US bounty on his head.

Little further details have been given, other than confirmation defense officials did not consider the mission a success, and therefore would have revealed the operation alongside the announcement of Soleimani’s death. 

Shahlai is considered by the US to be behind attacks on US troops in Iraq, including abduction and killings of five American soldiers in the city of Karbala in 2007, and is currently active in Yemen allegedly training and supplying the Shia Houthis in their attacks on the Saudis.

Last year the State Department’s special representative for Iran, Brian Hook, said the United States remains “gravely concerned by his presence in Yemen and potential role in providing advanced weaponry of the kind we have interdicted to the Houthis.”

Further, according to the WSJ, “In 2011, Mr. Shahlai orchestrated and funded a plot to assassinate the then Saudi ambassador to the U.S., Adel al-Jubeir, at a restaurant in the Georgetown area of Washington, the State Department said.”

The IRGC’s Ahmed Reza Shahali (right).

Beyond that, there hasn’t been evidence offered of just how “imminent” the threat represented by Shahlai is, at a moment the Trump administration has struggled to justify the Soleimani assassination amid push back from skeptical reporters, given the narrative has changed and altered somewhat over the past week.

Matthew Levitt, a former Treasury Department official and Iran analyst, described Shahlai as Gen. Soleimani’s “guy on the ground in Yemen.” Shahlai currently has a $15 million US bounty on his head. “Clearly, the intent here was to target some of the Quds Force’s most important and capable proxy handlers,” Levit further told the WSJ.


Tyler Durden

Sat, 01/11/2020 – 14:00

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