The Connecticut Hate-Crimes Law Used To Charge Two Idiot College Students Would Ban Family Guy Too

Two students at the University of Connecticut (UConn) have been “charged with ridicule on account of creed, religion, color, denomination, nationality or race. The misdemeanor charge is punishable by a maximum of 30 days in jail, a fine of up to $50 or both, according to state law.”

Video circulated by the UConn chapter of the National Association for the Advancement of Colored People (NAACP) shows the students, both 21, repeatedly using the n-word while walking through a parking lot. To put it bluntly, the students are fucking idiots. But the way the case is being handled—and the state law under which they are being charged—should deeply upset everyone who cares about free speech.

According to The Washington Post, Jarred Karal and Ryan Mucaj are also facing possible expulsion from UConn for violating the school’s code of conduct. That’s exactly right: The university should be deciding whether such mindless, ugly action warrants suspension of expulsion. Even though UConn is a state school (and thus bound by the First Amendment), it should be allowed to set reasonable expectations for student and faculty behavior.

But Connecticut’s hate crimes law penalizes all sorts of speech that should absolutely be protected. According to the law,

Any person who, by his advertisement, ridicules or holds up to contempt any person or class of persons, on account of the creed, religion, color, denomination, nationality or race of such person or class of persons, shall be guilty of a class D misdemeanor.

It’s not immediately clear whether Karal and Mucaj will be found guilty because they were not directly addressing particular individuals, an important aspect of the state law. In true dumbass fashion, in the video they seem to be wandering through a parking lot (with a third student who was not charged) shouting the slur repeatedly to the open air.

But the Connecticut law, “a rarely-enforced relic dating to 1917,” according to the folks at The Foundation for Individual Rights in Education (FIRE), effectively bans a huge amount of speech. When reading about this law, I thought immediately of the TV show Family Guy, which is based in Connecticut’s neighboring state of Rhode Island, and rarely misses an opportunity to mock and deride all classes of “persons, on account of the creed, religion, color, denomination, nationality or race.” It’s a rare episode of this New England-based show that doesn’t break the intentions of the Nutmeg State’s stupid law. Few TV shows have their own Wikipedia pages devoted to their takes on various groups that would be protected under the Connecticut law. Family Guy routinely mocks Islam, Catholicism, Christianity, transgender people, heterosexuals, old people—you name it.

Based on what I’ve read, including comments from UConn’s president, I think these students should face some sort of serious disciplinary action from the school, possibly even expulsion.

But that Connecticut law should be deep-sixed once and for all, especially given the state’s colonial history as a site of religious dissent and toleration. Speech is under attack everywhere these days, in ways that it hasn’t been since the 1950s. Just yesterday, Reason reported on a proposed law in Massachusetts that would criminalize the use of the word bitch. Leading national politicians routinely trot out new ways to regulate speech (looking at you, Sens. Josh Hawley and Elizabeth Warren). Conservatives are calling for porn prosecutions and liberals get bent out of shape over perceived Russian interference in political discourse on Facebook and other social-media platforms. Incidents such as the one at UConn are disturbing reminders of casual racism. They shouldn’t also be reminders of the precariousness of free speech.

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The Connecticut Hate-Crimes Law Used To Charge Two Idiot College Students Would Ban Family Guy Too

Two students at the University of Connecticut (UConn) have been “charged with ridicule on account of creed, religion, color, denomination, nationality or race. The misdemeanor charge is punishable by a maximum of 30 days in jail, a fine of up to $50 or both, according to state law.”

Video circulated by the UConn chapter of the National Association for the Advancement of Colored People (NAACP) shows the students, both 21, repeatedly using the n-word while walking through a parking lot. To put it bluntly, the students are fucking idiots. But the way the case is being handled—and the state law under which they are being charged—should deeply upset everyone who cares about free speech.

According to The Washington Post, Jarred Karal and Ryan Mucaj are also facing possible expulsion from UConn for violating the school’s code of conduct. That’s exactly right: The university should be deciding whether such mindless, ugly action warrants suspension of expulsion. Even though UConn is a state school (and thus bound by the First Amendment), it should be allowed to set reasonable expectations for student and faculty behavior.

But Connecticut’s hate crimes law penalizes all sorts of speech that should absolutely be protected. According to the law,

Any person who, by his advertisement, ridicules or holds up to contempt any person or class of persons, on account of the creed, religion, color, denomination, nationality or race of such person or class of persons, shall be guilty of a class D misdemeanor.

It’s not immediately clear whether Karal and Mucaj will be found guilty because they were not directly addressing particular individuals, an important aspect of the state law. In true dumbass fashion, in the video they seem to be wandering through a parking lot (with a third student who was not charged) shouting the slur repeatedly to the open air.

But the Connecticut law, “a rarely-enforced relic dating to 1917,” according to the folks at The Foundation for Individual Rights in Education (FIRE), effectively bans a huge amount of speech. When reading about this law, I thought immediately of the TV show Family Guy, which is based in Connecticut’s neighboring state of Rhode Island, and rarely misses an opportunity to mock and deride all classes of “persons, on account of the creed, religion, color, denomination, nationality or race.” It’s a rare episode of this New England-based show that doesn’t break the intentions of the Nutmeg State’s stupid law. Few TV shows have their own Wikipedia pages devoted to their takes on various groups that would be protected under the Connecticut law. Family Guy routinely mocks Islam, Catholicism, Christianity, transgender people, heterosexuals, old people—you name it.

Based on what I’ve read, including comments from UConn’s president, I think these students should face some sort of serious disciplinary action from the school, possibly even expulsion.

But that Connecticut law should be deep-sixed once and for all, especially given the state’s colonial history as a site of religious dissent and toleration. Speech is under attack everywhere these days, in ways that it hasn’t been since the 1950s. Just yesterday, Reason reported on a proposed law in Massachusetts that would criminalize the use of the word bitch. Leading national politicians routinely trot out new ways to regulate speech (looking at you, Sens. Josh Hawley and Elizabeth Warren). Conservatives are calling for porn prosecutions and liberals get bent out of shape over perceived Russian interference in political discourse on Facebook and other social-media platforms. Incidents such as the one at UConn are disturbing reminders of casual racism. They shouldn’t also be reminders of the precariousness of free speech.

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If Facebook Can Get Rid of Dick Pics, It Can Stop All Drug Deals Too, Claim Activists

“When was the last time anybody here saw a dick pic on Facebook?” asked Gretchen Peters, the chair of the Alliance to Counter Crime Online (ACCO), addressing representatives from the House Committee on Energy and Commerce last week. “If they can keep genitalia off of these platforms, they can keep drugs off of these platforms.”

Peters was part of a panel sent to testify on Section 230, the piece of legislation that protects tech companies from facing liability for content posted by third-party users online. There has been a great deal of misinformation peddled about the law—namely that platforms are prohibited from moderating content they deem harmful. In reality, it encourages tech companies to remove posts “in good faith,” so as to prevent the internet from devolving into a cesspool of negativity. Peters says they should be doing more.

But her testimony was laced with inaccuracies that reflect a fundamental misunderstanding about her goal, which is to punish online platforms and remove their legal protections should they fail to aggressively police illicit content.

There is an “incredible range and scale of illicit activity happening online,” she mused. “It is far worse than I ever imagined.”

Issuing an apocalyptic warning to the audience of members of Congress, Peters continued on to describe how social media giants are actively helping facilitate the “public health crisis” known as the opioid epidemic, which is claiming 60,000 American lives each year. A stream of studies “by ACCO members and others” affirmatively show the “widespread use of Google, Twitter, Facebook, Reddit, [and] YouTube to market and sell fentanyl, oxycodone, and other highly addictive, often deadly substances to U.S. consumers,” said Peters. “Every major internet platform has a drug problem.”

Yet which studies she is referencing remains unclear, as does her definition of “widespread.” The Center for Safe Internet Pharmacies (CSIP), which aims to curb illegal pharmaceutical sales online, estimates that less than 5 percent of all opioid purchases come from internet transactions. Interestingly, that same study surmises that the majority of such sales occur on the “dark web,” as opposed to the legally operated platforms that have drawn Peters’ ire.

“The voluntary efforts of internet and payment platforms such as Google, PayPal, and Bing, among other companies, to curb the online promotion of illicit products have disrupted these illicit businesses’ operations,” the report concludes, “specifically by removing the options of paid advertising and the most common payment methods.”

CSIP also specifically mentions Reddit, whose CEO, Steve Huffman, testified that the website would cease to exist in its current form should Section 230 protections be removed. “Drug vendors also take advantage of anonymous chat forums to find customers, but the most popular of these, reddit.com, has recently seen more scrutiny and enforcement by platform operators,” the report says.

Yet a vastly different impression was left with many members of Congress, several of whom said they found Peters’ testimony “jarring” and “horrifying.”

But never before has an industry been granted “total immunity no matter what their harm brings to consumers,” Peters said, which sounds deeply alarming on its face. The implication is that platforms can facilitate heinous crimes in broad daylight without fear of any repercussions.

The problem is that Peters’ claim is blatantly untrue.

Section 230 already contains a carve-out for federal criminal law, meaning that online platforms that are implicated in illegal behavior can be charged accordingly. Consider the Silk Road, a now-defunct dark website used to traffic illicit drugs. Its owner, Ross Ulbricht, is serving a double-life sentence plus 40 years. Not even Section 230 could save him from the harsh consequences of the drug war.

So what does Peters propose that Congress do? One can’t be sure—she offered no practical insight, other than a veiled remark about the need for “revised language” in the legislation.

What course of action she would have these companies take isn’t completely clear, either, although she provided some clues. Her dick pic example—which she gave in response to a question about concrete solutions—suggested that these websites have concocted the perfect crime-fighting algorithm. If they’ve figured out how to eliminate full-frontal nudity, so too should they be able to pinpoint and eradicate the drug market, she implies.

But this is preposterous when considering the intricate nature of black markets. It’s easy to find and flag a post that reads, “CHEAP FENTANYL FOR SALE!”—just as a picture of a penis might stand out in one’s newsfeed. Platforms are already working to erase that kind of content with relative success. Harder still is it to uncover covert illegal postings, many of which use secret Facebook groups and code words to fly under the radar. No advanced algorithm can perfectly pinpoint those. A 100 percent removal rate would likely require the manual review of every single item posted to those platforms—both an impossible undertaking, and something Section 230 was supposed to protect companies from having to do.

Even still, Peters would like to see platforms punished for failing to adequately stand up to organized crime. “If it’s illegal in real life, it ought to be illegal to host it online,” she repeated, meaning that tech firms would be criminally liable for failing to find each and every unlawful post.

And in reality, that effort would have the opposite of its intended effect: Worried about pending lawsuits or criminal charges, companies would be apt to remove any and all troublesome content, making it more difficult for law enforcement to track down those who break the rules.

Ironically, Peters seemed to recognize that shortfall when testifying. When tech companies remove illicit activity, she said that it destroys “critical evidence of a crime,” and “[helps] criminals to cover their tracks.” She should not expect that to get any better if her vague policy solution prevails.

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“You’ve Got To Be Kidding Me”: Outraged WeWork Employees Furious At Neumann’s $1.2BN “Platinum Parachute”

“You’ve Got To Be Kidding Me”: Outraged WeWork Employees Furious At Neumann’s $1.2BN “Platinum Parachute”

In the aftermath of the stunning news that after extracting $700 million from WeWork, which was effectively insolvent before SoftBank doubled down on its money-losing investment to breathe some life in the imploding office subletter, the company’s ex-CEO Adam Neumann was set to reap another $1.2 billion payday, outspoken critic Scott Galloway said that “This is a disaster we’ll be teaching for decades in b-school” adding that while the CEO gets a platinum parachute, “thousands of employees are scrambling to clean up the mess, knowing they have a 1 in 2 chance of being fired.”

Yet while Galloway may be correct in his business school case study forecast, he may have underestimated the anger bubbling among the company’s employees, because as Bloomberg notes, the reaction from his ex-colleagues, who are facing the prospect of mass job cuts and a corporate crisis: “You’ve got to be kidding me.

As WeWork’s disheartened employees walked in on Tuesday to learn that their recently departed messiah CEO was set to wave farewell to his noble pursuit of “elevating the world’s consciousness” and quit as WeWork’s Chairman in exchange for over $1 billion even as most of them faced near-certain termination, they took to the company’s system-wide communication system and that was one of the comments posted, reflecting the mood of anger and betrayal throughout its headquarters in New York. And, as Bloomberg adds, “dozens of employees expressed indignation in interviews and messages to colleagues on company Slack channels.” Predictably, those speaking out against an epic injustice that will be used by politicians for years to show the wealth chasm that has developed between the rich and everyone else, requested anonymity in a bid to protect their jobs, especially with management weighing the dismissal of thousands of employees.

To his credit, Neumann did build WeWork into a global real estate company fueled by relentless optimism and billions of dollars in investment capital and debt. In retrospect, however, virtually anyone could have done with Neumann did: after all, he was essentially selling a dollar for less than 50 cents, with the company set to burn through almost as much cash this year as it makes in revenue.

As such, it was only the generous investments by SoftBank, Benchmark and other VC who fell for Neumann’s spell that made WeWork “success” possible in the first place. In the end, however, the company sports a mere $8 billion valuation after investors already put down more than $17 billion into the venture: so far they are losing more than 50 cents for every dollar invested.

Which means that the only winner here is Adam Neumann who somehow will walk away with nearly $2 billion.

Ironically, it was his fake, virtue signaling sermons about community and mission that engendered a fierce loyalty among his gullible staff and investors for years. But it took just a few weeks for his aura to vanish over once public investors were given a closer look at the business ahead of an initial public offering: as a result of the wholesale revolt at what Neumann was peddling, WeWork’s valuation imploded from $47 billion to $8 billion as it abandoned its IPO. More importantly, absent a last minute bailout from SoftBank – which had already sunk $9 billion into WeWork – it would have been bankrupt in November.

Meanwhile, the company’s thousands of employees were forgotten by everyone, including their former messiah who it turned out, cared only about his exit package than his co-workers, whose consciousness would no longer be elevated.

To be sure, in recent weeks, an executive exodus and cost-saving measures had already dampened morale. Especially in satellite offices, many workers had stopped coming into work. But it was the news of Neumann’s “platinum parachute,” as one former employee described it, made things a lot worse this week.

A link to a news article about the deal on WeWork’s Slack network Tuesday drew more than 100 “thumbs down” emoji from employees. Several workers noted the irony that WeWork could not afford payroll costs associated with the planned job cuts but that its largest shareholder agreed to pay a hefty fee to Neumann. One post read: “So we’re too broke to pay employees severance, but Adam gets $200m?”

Another employee posted a photo of the orphan from “Oliver Twist” with the caption: “Please, Masayoshi Son, can I have some severance?” To that employee we have some soothing words: when this insane liquidity bubble finally bursts, Masayoshi Son will be in urgent need of severance himself.

As Bloomberg concludes, whereas Neumann was the main subject of staff fury, some complaints were also pointed at the pair of men who replaced him as CEO last month: “Seriously, where’s the email from our co-CEOs or whoever’s running the company now?”


Tyler Durden

Wed, 10/23/2019 – 12:05

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If Facebook Can Get Rid of Dick Pics, It Can Stop All Drug Deals Too, Claim Activists

“When was the last time anybody here saw a dick pic on Facebook?” asked Gretchen Peters, the chair of the Alliance to Counter Crime Online (ACCO), addressing representatives from the House Committee on Energy and Commerce last week. “If they can keep genitalia off of these platforms, they can keep drugs off of these platforms.”

Peters was part of a panel sent to testify on Section 230, the piece of legislation that protects tech companies from facing liability for content posted by third-party users online. There has been a great deal of misinformation peddled about the law—namely that platforms are prohibited from moderating content they deem harmful. In reality, it encourages tech companies to remove posts “in good faith,” so as to prevent the internet from devolving into a cesspool of negativity. Peters says they should be doing more.

But her testimony was laced with inaccuracies that reflect a fundamental misunderstanding about her goal, which is to punish online platforms and remove their legal protections should they fail to aggressively police illicit content.

There is an “incredible range and scale of illicit activity happening online,” she mused. “It is far worse than I ever imagined.”

Issuing an apocalyptic warning to the audience of members of Congress, Peters continued on to describe how social media giants are actively helping facilitate the “public health crisis” known as the opioid epidemic, which is claiming 60,000 American lives each year. A stream of studies “by ACCO members and others” affirmatively show the “widespread use of Google, Twitter, Facebook, Reddit, [and] YouTube to market and sell fentanyl, oxycodone, and other highly addictive, often deadly substances to U.S. consumers,” said Peters. “Every major internet platform has a drug problem.”

Yet which studies she is referencing remains unclear, as does her definition of “widespread.” The Center for Safe Internet Pharmacies (CSIP), which aims to curb illegal pharmaceutical sales online, estimates that less than 5 percent of all opioid purchases come from internet transactions. Interestingly, that same study surmises that the majority of such sales occur on the “dark web,” as opposed to the legally operated platforms that have drawn Peters’ ire.

“The voluntary efforts of internet and payment platforms such as Google, PayPal, and Bing, among other companies, to curb the online promotion of illicit products have disrupted these illicit businesses’ operations,” the report concludes, “specifically by removing the options of paid advertising and the most common payment methods.”

CSIP also specifically mentions Reddit, whose CEO, Steve Huffman, testified that the website would cease to exist in its current form should Section 230 protections be removed. “Drug vendors also take advantage of anonymous chat forums to find customers, but the most popular of these, reddit.com, has recently seen more scrutiny and enforcement by platform operators,” the report says.

Yet a vastly different impression was left with many members of Congress, several of whom said they found Peters’ testimony “jarring” and “horrifying.”

But never before has an industry been granted “total immunity no matter what their harm brings to consumers,” Peters said, which sounds deeply alarming on its face. The implication is that platforms can facilitate heinous crimes in broad daylight without fear of any repercussions.

The problem is that Peters’ claim is blatantly untrue.

Section 230 already contains a carve-out for federal criminal law, meaning that online platforms that are implicated in illegal behavior can be charged accordingly. Consider the Silk Road, a now-defunct dark website used to traffic illicit drugs. Its owner, Ross Ulbricht, is serving a double-life sentence plus 40 years. Not even Section 230 could save him from the harsh consequences of the drug war.

So what does Peters propose that Congress do? One can’t be sure—she offered no practical insight, other than a veiled remark about the need for “revised language” in the legislation.

What course of action she would have these companies take isn’t completely clear, either, although she provided some clues. Her dick pic example—which she gave in response to a question about concrete solutions—suggested that these websites have concocted the perfect crime-fighting algorithm. If they’ve figured out how to eliminate full-frontal nudity, so too should they be able to pinpoint and eradicate the drug market, she implies.

But this is preposterous when considering the intricate nature of black markets. It’s easy to find and flag a post that reads, “CHEAP FENTANYL FOR SALE!”—just as a picture of a penis might stand out in one’s newsfeed. Platforms are already working to erase that kind of content with relative success. Harder still is it to uncover covert illegal postings, many of which use secret Facebook groups and code words to fly under the radar. No advanced algorithm can perfectly pinpoint those. A 100 percent removal rate would likely require the manual review of every single item posted to those platforms—both an impossible undertaking, and something Section 230 was supposed to protect companies from having to do.

Even still, Peters would like to see platforms punished for failing to adequately stand up to organized crime. “If it’s illegal in real life, it ought to be illegal to host it online,” she repeated, meaning that tech firms would be criminally liable for failing to find each and every unlawful post.

And in reality, that effort would have the opposite of its intended effect: Worried about pending lawsuits or criminal charges, companies would be apt to remove any and all troublesome content, making it more difficult for law enforcement to track down those who break the rules.

Ironically, Peters seemed to recognize that shortfall when testifying. When tech companies remove illicit activity, she said that it destroys “critical evidence of a crime,” and “[helps] criminals to cover their tracks.” She should not expect that to get any better if her vague policy solution prevails.

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Lira Surges As Trump Confirms Ceasefire Is Permanent, Will Lift Turkey Sanctions

Lira Surges As Trump Confirms Ceasefire Is Permanent, Will Lift Turkey Sanctions

Update (1145ET): President Trump has confirmed that the ceasefire will be permanent and that US will lift sanctions on Turkey.

Trump then confirmed: “now we’re getting out…let someone else fight over this long bloodstained sand.”

The Lira is spiking on the news…

*  *  *

As we detailed earlier, EU governments have been fiercely divided over how to react to Turkey’s military incursion into northern Syria which commenced on Oct. 9 amid a US draw down from the region. One senior European diplomat described the situation to Reuters as “complete chaos”.

However, a draft resolution has been prepared this week, seen by Reuters, reportedly with the backing of all political groups in EU parliament, which urges “appropriate and targeted economic measures against Turkey” — and is expected to be adopted Thursday.

    Turkey-backed fighters in northeast Syria. Getty Image. 

    The targeted measures includes the following per Reuters:

    • freezing of preferential treatment for Turkish agriculture exports to the EU.

    • urges the suspension of the EU customs union with Ankara, a measure that would hit the 200-billion-euro ($222.3 billion) annual trade between the 28 EU nations and Turkey.

    • and opens the possibility to reduce the nearly 250-million-euro yearly financing given to Ankara as part of its protracted process to become an EU member, an option backed by the center-right group.

    One German center-right lawmaker Michael Gahler, who represents the largest political bloc in the EU assembly, said, “We demand that Turkey immediately withdraw from Syria.”

    This latest push to slash economic preferential treatment for Turkey comes after a failed push led by Germany and France to impose an EU-wide arms embargo on Ankara, who were concerned Turkey would use European weaponry to conduct massacres and human rights violations against the Kurds. 

    It also comes after President Erdogan has repeatedly threatened to flood European countries with millions of Syrian refugees if he couldn’t gain international backing for his ‘safe zone’ plan.

    While the EU has called for a UN-administered zone in northern Syria, its parliament could additionally block any new EU funding for Turkey’s resettlement of refugees, estimated at 3 million people. 


    Tyler Durden

    Wed, 10/23/2019 – 11:51

    Tags

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    Why Don’t You Write More About Right-Wing Antisemitism?

    As regular VC readers know, I write with some regularity about antisemitism. As such readers also know, I tend to focus more on left-wing antisemitism, and sometimes write about exaggerations of antisemitism on the right. My interlocutors sometimes accuse me of doing this for ideological reasons, that I “like” the right and “dislike” the left. Well, I actually don’t like right-wing antisemites. At all. To say the least.

    But there is another reason why my writings skew the way they do, which is my sense that those concerned most with antisemitism, in particular the Jewish community in both its organizational and individual manifestations, tend to focus on (and indeed sometimes exaggerate the scope of) right-wing antisemitism, and ignore, neglect, or downplay left-wing antisemitism.

    A new survey of American Jews confirms my instincts (I excluded the “don’t knows” below). For the record, my response to each of these would be “moderately serious threat”:

    In your view, how much of an antisemitic threat does the extreme political right represent in the United States today?

    Very serious threat 49%

    Moderately serious threat 29%

    Slight threat 11%

    No threat at all 9%

    In your view, how much of an antisemitic threat does the extreme political left represent in the United States today?

    Very serious threat 15%

    Moderately serious threat 21%

    Slight threat 28%

    No threat at all 34%

    In your view, how much of an antisemitic threat does extremism in the name of Islam represent in the United States today?

    Very serious threat 27%

    Moderately serious threat 27%

    Slight threat 31%

    No threat at all 14%

    A few things stand out here. First, about half of American Jews think extreme right-wing antisemitism is a very serious threat, and another 30% thinks it’s a moderately serious threat. So it’s not like there is a lack of concern about right-wing antisemitism that somehow needs correcting with blogging and other educational activities.

    On the other hand, the statistics for antisemitism on the extreme left and from radical Islamists are remarkable. For example, Great Britain is the second-closest country culturally to the U.S., after Canada. One of the two major parties has been taken over by an antisemite, and his ideological compatriots are a growing force in the Democratic Party. There have been a series of overtly (and well-publicized) antisemitic acts on college campuses arising from the extreme left. Some Democratic politicians openly admire antisemites ranging from the overt (Farrkhan) to the somewhat more subtle (Omar). But 34% of American Jews see no threat at all.

    With regard to radical Islam, there have been several murders of Jews and attacks on Jewish institutions emanating from radical Islamists over the last two decades, and Al Qaeda chose to attack New York City on 9/11 in part from antisemitic motive. Antisemitic violence in Europe, including well-publicized murders, comes primarily from Islamists. But 45% of American Jews see no threat at all or only a slight threat from extremist Islamists.

    Note also this question:

    Over the past five years, do you think antisemitism in the United States has…

    Increased a lot 43%

    Increased somewhat 41%

    Stayed the same 12%

    Decreased a little 3%

    Decreased a lot 1%

    There is, in fact, no good empirical evidence that antisemitism has increased *at all,* much less a lot, though extremist antisemites have become more vocal, organized, and more able to get a platform now that mainstream gatekeepers in the media no longer serve that function. Have they become more violent? Probably somewhat, but that’s a different question than whether antisemitism overall has increased.

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    Fed’s Fourth Bill POMO Is Most Oversubscribed Yet Amid Liquidity Scramble

    Fed’s Fourth Bill POMO Is Most Oversubscribed Yet Amid Liquidity Scramble

    One day after the Fed unexpectedly saw a surge in demand for its term-repo operation, which was oversubscribed for the first time since the mid-September repo crisis erupted, the liquidity shortage in the funding market appears to be getting worse by the day, and in today’s just concluded 4th consecutive T-Bill POMO, which saw the Fed monetize another batch of Bills, Dealers submitted $44.2BN in bids for the maximum $7.5BN in Fed “Reserve Management” (note: not QE) purchases.

    This means that today’s operation was 5.9x oversubscribed, the most of any operation since the launch of “Not QE4”, and clearly an increase from the first three POMOs, when operations were 4.3x, 4.8x and 5.5x oversubscribed.

    The results confirm that demand for the Fed’s permanent liquidity injection is increasing with every operation – suggesting that not only was the September repo turmoil not a one-time liquidity event, but that that liquidity shortage is getting worse – even as usage of the Fed’s latest overnight repo saw a modest decline.

    As such the question we have been asking for the past month – and one which Elizabeth Warren should also consider asking of Steven Mnuchin – remains: why are banks still so desperate for liquidity even though the Fed has now made clear that its balance sheet will expand to accommodate all reserve needs, and why do they so stubbornly refuse to approach the interbank market for their funding needs? In short, what do they know about the banking system that we don’t?


    Tyler Durden

    Wed, 10/23/2019 – 11:40

    via ZeroHedge News https://ift.tt/2oXO88q Tyler Durden

    Why Don’t You Write More About Right-Wing Antisemitism?

    As regular VC readers know, I write with some regularity about antisemitism. As such readers also know, I tend to focus more on left-wing antisemitism, and sometimes write about exaggerations of antisemitism on the right. My interlocutors sometimes accuse me of doing this for ideological reasons, that I “like” the right and “dislike” the left. Well, I actually don’t like right-wing antisemites. At all. To say the least.

    But there is another reason why my writings skew the way they do, which is my sense that those concerned most with antisemitism, in particular the Jewish community in both its organizational and individual manifestations, tend to focus on (and indeed sometimes exaggerate the scope of) right-wing antisemitism, and ignore, neglect, or downplay left-wing antisemitism.

    A new survey of American Jews confirms my instincts (I excluded the “don’t knows” below). For the record, my response to each of these would be “moderately serious threat”:

    In your view, how much of an antisemitic threat does the extreme political right represent in the United States today?

    Very serious threat 49%

    Moderately serious threat 29%

    Slight threat 11%

    No threat at all 9%

    In your view, how much of an antisemitic threat does the extreme political left represent in the United States today?

    Very serious threat 15%

    Moderately serious threat 21%

    Slight threat 28%

    No threat at all 34%

    In your view, how much of an antisemitic threat does extremism in the name of Islam represent in the United States today?

    Very serious threat 27%

    Moderately serious threat 27%

    Slight threat 31%

    No threat at all 14%

    A few things stand out here. First, about half of American Jews think extreme right-wing antisemitism is a very serious threat, and another 30% thinks it’s a moderately serious threat. So it’s not like there is a lack of concern about right-wing antisemitism that somehow needs correcting with blogging and other educational activities.

    On the other hand, the statistics for antisemitism on the extreme left and from radical Islamists are remarkable. For example, Great Britain is the second-closest country culturally to the U.S., after Canada. One of the two major parties has been taken over by an antisemite, and his ideological compatriots are a growing force in the Democratic Party. There have been a series of overtly (and well-publicized) antisemitic acts on college campuses arising from the extreme left. Some Democratic politicians openly admire antisemites ranging from the overt (Farrkhan) to the somewhat more subtle (Omar). But 34% of American Jews see no threat at all.

    With regard to radical Islam, there have been several murders of Jews and attacks on Jewish institutions emanating from radical Islamists over the last two decades, and Al Qaeda chose to attack New York City on 9/11 in part from antisemitic motive. Antisemitic violence in Europe, including well-publicized murders, comes primarily from Islamists. But 45% of American Jews see no threat at all or only a slight threat from extremist Islamists.

    Note also this question:

    Over the past five years, do you think antisemitism in the United States has…

    Increased a lot 43%

    Increased somewhat 41%

    Stayed the same 12%

    Decreased a little 3%

    Decreased a lot 1%

    There is, in fact, no good empirical evidence that antisemitism has increased *at all,* much less a lot, though extremist antisemites have become more vocal, organized, and more able to get a platform now that mainstream gatekeepers in the media no longer serve that function. Have they become more violent? Probably somewhat, but that’s a different question than whether antisemitism overall has increased.

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    Rates Tumbling Everywhere, Except Credit Cards Where They’ve Never Been Higher

    Rates Tumbling Everywhere, Except Credit Cards Where They’ve Never Been Higher

    Submitted by Joseph Carson, Former Director of Global Economic Research, Alliance Bernstein

    The State of the Consumer: Views From Retail & Banks

    How strong is the consumer sector? It depends on where you sit in the food chain of consumer sales and finance.

    Nominal growth of consumer spending in 2019 has slowed to its weakest growth rate in three years, with many traditional retailers seeing no growth in top-line sales. And yet large commercial banks indicate that their consumer finance arm shows a “healthy consumer”.

    The difference in the direction and tone of business is very straightforward; retail is counting how much consumers are spending at their establishments, while commercial banks are counting how much consumers are paying in interest when they borrow to spend.

    Banks are happy (for now) as consumer interest payments at record levels are rising more than twice as fast as consumer spending. Yet, that trend can’t continue for long as rising interest expense drains consumer liquidity, weakens the consumer ability to spend, dampens growth and eventually ends up impacting retail and banks alike.

    Painting By The Numbers

    Through the first 9 months of 2019, nominal consumer spending—which includes all goods and services and traditional and e-commerce retailers— is running less than 4%, a drop-off of roughly 125 basis points from the 2018 performance.

    Although nominal income growth is running close to 5%, consumers still saw the need to increase consumer borrowing (i.e., personal loans and credit cards) by 5% in order to support spending. Perhaps that reflects the unevenness of income growth and lack of a liquidity buffer among various income groups.

    On the surface, the growth of consumer borrowing is not excessive, but what is excessive is how much it costs consumers to borrow.

    Personal loan rates at commercial banks stand at 10%, and average credit card rates stand at 15%. However, the actual cost of credit card borrowing is much higher, since banks charge interest not only on the daily balance but also on prior months interest rate charges, along with other fees.

    The Federal Reserve has estimated the true cost of credit card borrowing. The assessed interest rate charges on all credit card accounts averaged 17% in 2019 (200 basis points above published average rates), and represent the highest assessed rate since the Federal Reserve started measuring the all-in-costs of credit card borrowing in 1995.

    Record high rates for credit card borrowers runs counter to the JP Morgan view that “consumer remains healthy, with growth in wages and spending, combined with strong balance sheets”. A “good” consumer borrower, with “good” wage growth and “good” balance sheets should not be paying record high interest rates.

    According to the Bureau of Economic Analysis, consumer interest rate payments hit a new record high of $368 billion in Q3 2019, more than one third above the peak of the 2008 financial crisis, and 10% above what consumers paid in 2018.

    In short, rising interest expenses are sucking the “spending power” out of the consumer. Retail is already seeing the impact and banks will soon see it as well.


    Tyler Durden

    Wed, 10/23/2019 – 11:25

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