S&P 500 (Finally) Spikes To New Intraday Record High

S&P 500 (Finally) Spikes To New Intraday Record High

Tyler Durden

Tue, 08/18/2020 – 09:44

Six days ago, The S&P 500 pushed above its previous record closing high (3386.15 on 2/19/20) for the first time.

And after a week of trying and failing, this morning has seen stocks spike up and finally take out the all-time record intraday high (3393.52 on 2/19/20) – erasing all impact of the pandemic and global depression…

…because fun-durr-mentals…

Just Kidding – here’s why!

Hold your nose and buy the record high? Or is the bounce over?

Mission Accomplished?

via ZeroHedge News https://ift.tt/2CCX4H3 Tyler Durden

Dollar-Bans, Dismal ‘Downunder’ & The Democratic National Unconvention

Dollar-Bans, Dismal ‘Downunder’ & The Democratic National Unconvention

Tyler Durden

Tue, 08/18/2020 – 09:30

By Michael Every of Rabobank

More national, more unconventional

As I type, in the US the Democratic National Convention (DNC) is playing out over the internet, reminding us all that we are only 76 days to the US election. Or should it be called the National Unconvention? After all, it’s only on the internet due to Covid-19, and it is featuring a speaker who ran for president as a Republican as recently as 2016, who is not the only Republican present. Unconventional, indeed. As the press state, on day one of four the message is “Trump, Trump, and Trump,” clearly attempting to make the 2020 vote all about Trump himself, which is seen by pundits as the most effective Democrat electoral strategy, rather than Trump vs. Biden. That’s as a CNN poll yesterday placed Trump only 4 points behind Biden nationally, closing the gap by 10 points in two months, and only by 1 in key battleground states; this was also the poll which had led the others in showing a huge swing to Biden in June. However, other polls still show a larger gap: the CNN poll of polls has Biden plus 9 nationally.

Trump himself is doing his own attacks, of course, not just with digital advertising placed around the DNC, which in contrast to a physical convention is now possible, but with his latest actions against Huawei, which Bloomberg describe as a “nuclear option”. From now on China’s flagship tech firm can’t access US technology directly or indirectly, an action which leaves it in extremely difficult circumstances: how do you have a tech product without the tech? It’s a good job that the US-China phase one trade deal review didn’t happen, isn’t it? We now await the Twitter response from the pugnacious editor of the Global Times, who stars in a clip shared on the same medium yesterday giving a speech where he exults “I have to say that China can force the US to an agricultural country,” which gets a round of applause from the audience.

Speaking of agricultural countries, China just hit Australian wine imports with an anti-dumping investigation. This could last up to 18 months and clearly has nothing (nothing!) to do with the deteriorating geopolitical backdrop. That’s now Aussie beef, barley, and wine all subject to various Chinese actions, while Chinese students and tourists can’t arrive at present and are potentially not going to come back at all. Thank goodness for iron ore…but that’s one last big egg in a basket with a handle that’s fraying fast.

And on fraying baskets and nuclear options, Bloomberg Intelligence today says “Hong Kong Banks May Face Fines, Not Dollar Ban” for dealing with individuals sanctioned by the US, noting that this is what happened to two European banks when they violated sanctions on Iran, and that Chinese banks are large enough to be able to afford such fines. So all is well! Perhaps. Then again, European banks are not seen in the same way as Chinese banks by the US, and it would presumably impose a fine specifically large enough to hurt them.

Far more importantly, however, Bloomberg Intelligence don’t seem to have bothered to read the actual Hong Kong Autonomy Act (HKAA). I know, I know, it’s dull to actually go to the source rather than whipping up a precedent that says all ends well. However, let’s be dull. The HKAA specifically states that no later than a year from the imposition of sanctions on HK individuals (which happened on 8 August) then FIVE of the following list of sanctions must be imposed, and a year later ALL of them:

No loans from US financial institutions; Prohibition on designation as US primary dealer; Prohibition on service as a repository of government funds; FX transactions; Banking transactions; Property transactions; Restrictions on exports, re-exports, and transfers; Ban on investment in equity or debt; Exclusion of corporate officers; Sanctions on principal executive officers.

I don’t see “or a large but manageable fine” on that list, which means the most bullish case one can make is that less than a year from now, any bank dealing with individuals sanctioned under the HKAA would be unable to get a loan from a US bank, or be a primary dealer and repository of US government funds, or buy US property, and its executives would be excluded from the US. That would certainly be manageable for a year: but then, on 8 August 2022, it’s the USD and SWIFT.

Meanwhile, in Canada Finance Minister Moreau has had to step down due to his actions over a charity; and in the UK the education secretary is holding on by his fingernails after almost seeing his own government flunk its handling of exam results. He has now decided UK schoolkids can have their results set by their teacher (who has NO self-interest in pushing grades higher in an education system where schools have to compete based on exam results) rather than an algorithm trying to fit outcomes to a bell-curve: which is going to mean everyone gets higher grades rather than lower, of course. Just another area where we don’t have any inflation to add to the list of: private education; health insurance; house prices, and stock prices, etc. The top bureaucrat who had decided an algorithmic bell curve was best apparently used to work for the Financial Times: you’d have thought he would have realized how regulators are supposed to oversee such markets.

Down in Australia, the RBA’s minutes from August show they are worried that cheap funding is not flowing through to growth in borrowing: “…the flow of new commitments has remained well below its peak and was likely to remain subdued…” What? You mean lowering the cost of borrowing does NOT lead to a rise in productive investment? Really?! The mountain of evidence that this is precisely the case, even when rates go negative –as predicted by Kalecki as far back as 1943– has apparently not filtered through to the RBA yet. Then again, should we be surprised given on Friday Governor Lowe stated to parliament “If a bank never makes a loan that goes bad it means it’s not extending enough credit.” Question: what does the RBA have left to throw on the barbie when Kalecki is again shown to be right?

As everywhere: policies that are more “national” and more unconventional.

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Kamala Harris’ Limited Vision of Religious Liberty

Kamala Harris

When presumptive Democratic vice presidential nominee Kamala Harris was running for president, she appeared at CNN’s Equality Town Hall, an October event focused on the LGBTQ community. How, one questioner asked, will Harris communicate her “liberal, Californian perspective when reaching out to voters in small, conservative areas?”

Harris said she’d tell the story of a day in 2004 where she arrived at San Francisco’s City Hall to find families of same-sex couples lined up around the block to witness their loved ones’ weddings. “It was a day where people who loved each other had the ability for their love to be recognized by law,” said Harris, who herself officiated gay weddings years before they were legalized statewide in California. “And if anyone has known love, and honors the importance of love and the commitment one person is willing to make to another person in the name of love,” she continued, “they should always recognize and encourage that nobody would be treated differently under the law.”

It’s an evocative story about why gay marriage should be allowed, but it doesn’t address the chief concern you’ll hear from religious conservatives these days: Whether they’ll be compelled to participate in and pay for things, particularly in the workplace, which their creeds and consciences forbid. Unfortunately, this wasn’t a momentary lapse: Harris shows little interest in reaching common ground with voters worried about religious liberty. She even seems unwilling to acknowledge the possibility that their fears could be based in something more substantive than a failure to have “known love.”

The Supreme Court’s June decision on Bostock v. Clayton County is a useful synecdoche for LGBTQ policies. Bostock controversially expanded employment discrimination protections to include sexual orientation and gender identity. Though a subsequent ruling enhanced the “ministerial exception,” which gives religious institutions far wider latitude in hiring and firing, Bostock was considered catastrophic by many religious conservatives who want to bring their beliefs into business contexts that aren’t explicitly religious. At least arguably, the court has protected religious institutions but not individuals. Harris cheered Bostock, which accomplished a major goal of her 2017 and 2019 legislation to weaken the Religious Freedom Restoration Act.

The birth control fight, similarly, turns on whether the state can force employers to pay for birth control they consider abortifacient if doing so violates their religious beliefs. Harris says employers must be made to pay. In 2014, as California’s attorney general, she filed an amicus brief in the Hobby Lobby case that presented a stunningly narrow view of free religious exercise. She described it as “personal, relating only to individual believers and to a limited class of associations comprising or representing them.” The Constitution “protect[s] the development and expression of an ‘inner sanctum’ of personal religious faith,” Harris wrote, but not “the exercise of such inherently personal rights by ordinary, for-profit business corporations.”

This is a bizarre vision of faith confined to mental assent and perhaps a few private ceremonies. It is unrecognizable and nigh useless from many religious perspectives, for most religious people believe our faith should inform all parts of our lives, including our work. In that case, protecting only an “inner sanctum” is no protection at all.

Then there’s abortion. Harris is pro-choice, of course, but her stance goes well beyond ensuring abortion is legal and accessible. She’s a vocal proponent of federal funding for abortion. In California, she championed legislation forcing pro-life pregnancy centers to advertise free or cheap abortion options to their clients. (The law was later struck down as a First Amendment violation.) Critics and supporters alike have said Harris’ bill to weaken the Religious Freedom Restoration Act could be used to require Catholic health care providers, for example, to perform abortions.

Perhaps the single most revealing comment Harris has made on abortion came in 2018, when the U.S. Senate was considering the nomination of Brian Buescher for a district judgeship. “Since 1993,” she said, “you have been a member of the Knights of Columbus, an all-male society comprised primarily of Catholic men. In 2016, Carl Anderson, leader of the Knights of Columbus, described abortion as ‘a legal regime that has resulted in more than 40 million deaths.’ Mr. Anderson went on to say that ‘abortion is the killing of the innocent on a massive scale.’ Were you aware that the Knights of Columbus opposed a woman’s right to choose when you joined the organization?”

This is what has conservative Catholics denouncing Harris as an anti-Catholic bigot. To be Catholic, they say she’s implying, is to be an extremist unsuitable for the federal bench. That’s a plausible reading, though it’s complicated somewhat by her willingness to run alongside Joe Biden—but then, Biden isn’t exactly the same sort of Catholic. The assumptions undergirding Harris’ comment suggest she doesn’t think people whose religion places them on the opposite side of the culture war merit much protection in public life.

Finally, there’s Harris’ gleefully expressed willingness to override constitutional rights by executive order. At a primary debate in September, she sneered at the “idea that we would wait for this Congress that has just done nothing” to issue a federal assault weapons ban, breaking with Biden on the constitutionality of such a move.

Biden’s view may hold sway for the next four years. But it’s not hard to imagine a President Harris in 2025, freed of Biden’s lingering constitutional constraints, deciding that executive orders could be used on First Amendment matters as well as Second. Whatever lip service Harris pays to Americans’ freedom to worship, it’s a freedom she clearly wants neatly confined to our own heads.

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Michelle Obama Hates Politics and Third Parties, Loves Schmaltz and Unity

Untitled(4)

Sen. Bernie Sanders (I–Vt.) and a slew of musical guests were on the roster for night one of the virtual Democratic National Convention, a two-hour hodgepodge of panels, speeches, smooth jazz, hope, and nonsense. But it was former first lady Michelle Obama who stole the show with an eloquent speech that harked back to her husband’s heyday and less complicated times.

There was nothing remarkable about the contents of her speech, or at least there wouldn’t have been in another era. Perhaps its focus on unity and a simple but dignified message are themselves a rarity in 2020 politics.

“Let’s be clear: Going high does not mean putting on a smile and saying nice things when confronted by viciousness and cruelty,” said Obama in the pre-recorded segment which aired last night.

Going high means taking the harder path. It means scraping and clawing our way to that mountaintop. Going high means standing fierce against hatred while remembering that we are one nation under God, and if we want to survive, we’ve got to find a way to live together and work together across our differences.

Obama’s speech moved seamlessly between the personal and the political, weaving a narrative thread between her husband’s administration with Joe Biden as vice president and a potential Biden presidency. She touched on the COVID-19 pandemic, racial justice, and other highly-charged issues without getting all mucked up culture war grievances; it was all top-level values and empathy.

“The America that is on display for the next generation” is “a nation that’s underperforming not simply on matters of policy but on matters of character,” said Obama.

And that’s not just disappointing; it’s downright infuriating, because I know the goodness and the grace that is out there in households and neighborhoods all across this nation.

And I know that regardless of our race, age, religion, or politics, when we close out the noise and the fear and truly open our hearts, we know that what’s going on in this country is just not right. This is not who we want to be.

Michelle Obama didn’t chastise past Trump voters but appealed to people’s better angels, and—in contrast to much Democratic messaging these days—didn’t try to portray President Donald Trump as a literal fascist or a shady foreign stooge, but rather someone that many Americans simply know, deep down, just isn’t right.

“Let me be as honest and clear as I possibly can,” said Obama. “Donald Trump is the wrong president for our country. He has had more than enough time to prove that he can do the job, but he is clearly in over his head. He cannot meet this moment. He simply cannot be who we need him to be for us. It is what it is.”

A lot of people seemed to be inspired.

Others found her delivery stilted and optimism forced.

I’ll split the difference and say it was indeed schmaltzy and basic but that’s probably exactly what the moment called for and, honestly, it was still a little refreshing. (I also liked that it didn’t mention Biden’s V.P. pick, Kamala Harris, at all even if this was just because the segment was recorded before the pick was announced.)

The only truly annoying part of Obama’s speech was her dig at third-party voters.

“This is not the time to withhold our votes in protest or play games with candidates who have no chance of winning,” Obama said. “We have got to vote like we did in 2008 and 2012.”

That wouldn’t be the worst thing: In 2012, the Libertarian Party saw its highest number of votes yet, with candidate Gary Johnson earning nearly 1 percent of the popular vote that year. But Johnson and the L.P. smashed this record in 2016, gaining 3.28 percent of the popular vote.

Were these—and votes for other non-Democratic or Republican candidates—wasted? Hardly. As Reason‘s Matt Welch wrote recently, “behavior that gets rewarded gets repeated. If you reward your party for nominating people you don’t like, chances are very likely that will happen again, sooner rather than later. There is a contradiction in complaining that two-party choices seem to get worse every four years while still voting reliably for one of those choices.”

Watch Obama’s whole speech here.

FREE MINDS

Happy 100th anniversary to the 19th Amendment to the U.S. Constitution, which said “the right of citizens of the United States to vote shall not be denied or abridged by the United States or by any State on account of sex.” I’ll be talking tonight with author and Liberty Fund Senior Fellow Sarah Skwire, Rachel Davison Humphries of the Bill of Rights Institute, and the Cato Institute’s Kat Murti about the history of the suffrage movement, its divides and missteps, and what the 19th Amendment actually meant for American women and electoral politics. The panel is hosted by Feminists for Liberty, a nonprofit libertarian feminist group that Murti and I founded. Tune in via Zoom at 7 p.m. EST.

FREE MARKETS

Some authorities have reservations about the antitrust attack on Google. “Some Justice Department staffers have expressed internal concerns over plans to bring an antitrust lawsuit against … Google—and what they view as an aggressive timeline favored by Attorney General William Barr,” the Wall Street Journal reports:

There are a range of views among staff about a Google case, people familiar with the deliberations said. Some Justice Department lawyers believe Google’s conduct isn’t blameless, but they don’t want to bring a once-in-a-generation lawsuit with flaws and lose in court, the people said.

Some staffers also are concerned that top officials overseeing the probe might be feeling pressure to get a lawsuit filed before the election, the people said.

More here.

QUICK HITS

• College “free speech zones” are getting a look from the U.S. Supreme Court.

• Teachers are calling the cops over kids skipping virtual classes.

• Viral photos of the horrors supposedly brought by Postal Service cuts keep turning out to be not at all what people fear.

• How social justice slideshows took over Instagram.

from Latest – Reason.com https://ift.tt/31bNh4l
via IFTTT

Michelle Obama Hates Politics and Third Parties, Loves Schmaltz and Unity

Untitled(4)

Sen. Bernie Sanders (I–Vt.) and a slew of musical guests were on the roster for night one of the virtual Democratic National Convention, a two-hour hodgepodge of panels, speeches, smooth jazz, hope, and nonsense. But it was former first lady Michelle Obama who stole the show with an eloquent speech that harked back to her husband’s heyday and less complicated times.

There was nothing remarkable about the contents of her speech, or at least there wouldn’t have been in another era. Perhaps its focus on unity and a simple but dignified message are themselves a rarity in 2020 politics.

“Let’s be clear: Going high does not mean putting on a smile and saying nice things when confronted by viciousness and cruelty,” said Obama in the pre-recorded segment which aired last night.

Going high means taking the harder path. It means scraping and clawing our way to that mountaintop. Going high means standing fierce against hatred while remembering that we are one nation under God, and if we want to survive, we’ve got to find a way to live together and work together across our differences.

Obama’s speech moved seamlessly between the personal and the political, weaving a narrative thread between her husband’s administration with Joe Biden as vice president and a potential Biden presidency. She touched on the COVID-19 pandemic, racial justice, and other highly-charged issues without getting all mucked up culture war grievances; it was all top-level values and empathy.

“The America that is on display for the next generation” is “a nation that’s underperforming not simply on matters of policy but on matters of character,” said Obama.

And that’s not just disappointing; it’s downright infuriating, because I know the goodness and the grace that is out there in households and neighborhoods all across this nation.

And I know that regardless of our race, age, religion, or politics, when we close out the noise and the fear and truly open our hearts, we know that what’s going on in this country is just not right. This is not who we want to be.

Michelle Obama didn’t chastise past Trump voters but appealed to people’s better angels, and—in contrast to much Democratic messaging these days—didn’t try to portray President Donald Trump as a literal fascist or a shady foreign stooge, but rather someone that many Americans simply know, deep down, just isn’t right.

“Let me be as honest and clear as I possibly can,” said Obama. “Donald Trump is the wrong president for our country. He has had more than enough time to prove that he can do the job, but he is clearly in over his head. He cannot meet this moment. He simply cannot be who we need him to be for us. It is what it is.”

A lot of people seemed to be inspired.

Others found her delivery stilted and optimism forced.

I’ll split the difference and say it was indeed schmaltzy and basic but that’s probably exactly what the moment called for and, honestly, it was still a little refreshing. (I also liked that it didn’t mention Biden’s V.P. pick, Kamala Harris, at all even if this was just because the segment was recorded before the pick was announced.)

The only truly annoying part of Obama’s speech was her dig at third-party voters.

“This is not the time to withhold our votes in protest or play games with candidates who have no chance of winning,” Obama said. “We have got to vote like we did in 2008 and 2012.”

That wouldn’t be the worst thing: In 2012, the Libertarian Party saw its highest number of votes yet, with candidate Gary Johnson earning nearly 1 percent of the popular vote that year. But Johnson and the L.P. smashed this record in 2016, gaining 3.28 percent of the popular vote.

Were these—and votes for other non-Democratic or Republican candidates—wasted? Hardly. As Reason‘s Matt Welch wrote recently, “behavior that gets rewarded gets repeated. If you reward your party for nominating people you don’t like, chances are very likely that will happen again, sooner rather than later. There is a contradiction in complaining that two-party choices seem to get worse every four years while still voting reliably for one of those choices.”

Watch Obama’s whole speech here.

FREE MINDS

Happy 100th anniversary to the 19th Amendment to the U.S. Constitution, which said “the right of citizens of the United States to vote shall not be denied or abridged by the United States or by any State on account of sex.” I’ll be talking tonight with author and Liberty Fund Senior Fellow Sarah Skwire, Rachel Davison Humphries of the Bill of Rights Institute, and the Cato Institute’s Kat Murti about the history of the suffrage movement, its divides and missteps, and what the 19th Amendment actually meant for American women and electoral politics. The panel is hosted by Feminists for Liberty, a nonprofit libertarian feminist group that Murti and I founded. Tune in via Zoom at 7 p.m. EST.

FREE MARKETS

Some authorities have reservations about the antitrust attack on Google. “Some Justice Department staffers have expressed internal concerns over plans to bring an antitrust lawsuit against … Google—and what they view as an aggressive timeline favored by Attorney General William Barr,” the Wall Street Journal reports:

There are a range of views among staff about a Google case, people familiar with the deliberations said. Some Justice Department lawyers believe Google’s conduct isn’t blameless, but they don’t want to bring a once-in-a-generation lawsuit with flaws and lose in court, the people said.

Some staffers also are concerned that top officials overseeing the probe might be feeling pressure to get a lawsuit filed before the election, the people said.

More here.

QUICK HITS

• College “free speech zones” are getting a look from the U.S. Supreme Court.

• Teachers are calling the cops over kids skipping virtual classes.

• Viral photos of the horrors supposedly brought by Postal Service cuts keep turning out to be not at all what people fear.

• How social justice slideshows took over Instagram.

from Latest – Reason.com https://ift.tt/31bNh4l
via IFTTT

Prosecutors Working For Kamala-Mentored DA Committed “Substantial Abuses” During Smollett Investigation

Prosecutors Working For Kamala-Mentored DA Committed “Substantial Abuses” During Smollett Investigation

Tyler Durden

Tue, 08/18/2020 – 09:10

Before the pandemic, we had Jussie Smollett – the former “Empire” star whose racist 2019 hate-crime hoax destroyed his career, stoked racial tensions nationwide, and cost Chicago taxpayers a reported $130,000 in police overtime thanks the MSM and prominent liberals who breathlessly reported Smollett’s lies as fact.

And according to findings by a special prosecutor tasked with investigating what looked like a massive cover-up by the Cook County DA’s office, State’s Attorney Kim Foxx and her assistant prosecutors committed ‘substantial abuses of discretion,’ but did not break the law.

To review, Smollett claimed that two white Trump supporters in MAGA hats assaulted him on a freezing cold January night at 2 a.m., calling him racist and homophobic slurs before beating him up and leaving a noose around his neck (which he was wearing when police arrived). The actor said he chased the two white men off after the alleged ‘hate crime.’

Kamala Harris – who mentored Cook County DA Kim Foxx and was coincidentally working on an anti-lynching bill at the time with Sen. Cory Booker (D-NJ), called it a ‘modern day lynching.’

Except, the ‘attackers’ turned out to be Smollett’s twin, drug-dealing, Nigerian bodybuider brothers from Nigeria – one of whom he was in a sexual relationship with. The brothers later told police Smollett paid them to stage the attack, while Smollett says they’re lying.

Trouble in paradise

Despite overwhelming evidence, including the brothers confession and video of them buying rope, Foxx’s office dropped a 16-count Grand Jury indictment against Smollett after Michelle Obama’s former Chief of Staff, Tina Tchen, called in a favor – asking that Smollett’s case be placed in the hands of the FBI.

“Spoke to the Superintendent Johnson,” Foxx told Tchen in a Feb. 1 email obtained by the Chicago Tribune, in reference to Chicago Police Superintendent Eddie Johnson. “I convinced him to Reach out to FBI to ask that they take over the investigation.”

Tchen, who has denied trying to affect the outcome of the case, admitted to contacting Foxx and later evaded a subpoena in the case.

Did we mention Smollett’s sisters worked for the 2008 and 2012 Obama campaigns? Or that Smollett and Kamala Harris attended a 2018 protest together?

Jussie Smollett, Kamala Harris at 2018 protest

‘Substantial abuses’

In a Wednesday statement following the conclusion of his investigation into the Smollett case, special prosecutor Dan Webb said that Foxx and her assistant prosecutors severely mishandled the case – which was marked by chaos and false or misleading statements, as well as a legally meaningless recusal by Foxx.

To review, straight from the horse’s mouth (emphasis ours):

*  *  *

The OSP developed evidence that establishes three substantial abuses of discretion and failures by the CCSAO in prosecuting and resolving the Initial Smollett Case.

  • First Finding of Abuse of Discretion: The CCSAO’s process and decision-making for resolving the Initial Smollett Case were a substantial abuse of discretion and represented a major failure of the operations of the CCSAO, including in the following ways:
    • On March 26, 2019, 19 days after filing the indictment against Mr. Smollett, the CCSAO dismissed the entire indictment against Mr. Smollett on the following terms: (1) complete dismissal of the 16-count felony indictment against Mr. Smollett; (2) no requirement that Mr. Smollett plead guilty to any criminal offense under Illinois law; (3) no requirement that Mr. Smollett admit any guilt of his wrongdoing (in fact, following the court proceedings on March 26, 2019, Mr. Smollett publicly stated he was completely innocent); (4) the only punishment for Mr. Smollett was to perform 15 hours of community service that had no relationship to the charged conduct; (5) only requiring Mr. Smollett to forfeit his $10,000 bond as restitution to the City of Chicago (a figure amounting to less than 10% of the $130,106.15 in police overtime pay that the City alleges it paid solely due to Mr. Smollett’s false statements to police); and (6) no requirement that Mr. Smollett participate in the CCSAO’s Deferred Prosecution Program (Branch 9) (“DPP”), which would have required a one-year period of court oversight over Mr. Smollett. 
    • Almost across the board, lawyers who currently work in or previously worked in the CCSAO’s criminal division who were interviewed by the OSP—including State’s Attorney Foxx—were “surprised” or “shocked” by at least some facet of the dismissal terms.
    • The CCSAO decision-makers on the Initial Smollett Case (Acting State’s Attorney Joseph Magats and Lead Prosecutor Risa Lanier) did not learn of any new evidence between when the CCSAO filed a 16-count indictment against Mr. Smollett on March 7, 2019, when the CCSAO believed it had a strong case against Mr. Smollett, and March 26, 2019, when the entire indictment was dismissed, as described above.
    • The CCSAO decision-makers on the Initial Smollett Case have significantly and meaningfully divergent explanations for how the resolution was reached, including who negotiated the terms, whether Mr. Smollett was offered the opportunity to participate in the DPP, and whether the terms of the resolution were modeled after the requirements of the DPP.
    • The terms of Mr. Smollett’s resolution do not track the requirements of the DPP.
    • The CCSAO did not screen Mr. Smollett’s case to determine if he was eligible for referral to the DPP.
    • The CCSAO did not rely upon any specific similar CCSAO cases when resolving the Initial Smollett Case. 
    • The CCSAO’s decision to advance the Initial Smollett Case from April 17, 2019 to March 26, 2019 to dismiss it minutes before conducting the dismissal hearing did not provide notice to the media or public, despite knowing there was significant interest in the case, including that the media had filed a petition to have cameras in the courtroom.  
    • Ms. Lanier read a statement during the dismissal hearing that she drafted in conjunction with Mr. Smollett’s counsel, which was atypical.
    • The CCSAO did not consult with the CPD about the terms of the resolution and intentionally chose not to alert the CPD that the case would be dismissed until minutes before the hearing, despite all of the diligent and hard work the CPD put into investigating the case and the fact that many CCSAO interviewees would have considered the CPD a victim of Mr. Smollett’s alleged crimes and/or for purposes of restitution.
  • Second Finding of Abuse of Discretion: The CCSAO engaged in a substantial abuse of discretion and breached its obligations of honesty and transparency by making false and/or misleading statements to the public regarding the nature and reasons for the dismissal of the Initial Smollett Case.  Specifically:
    • The CCSAO issued a press statement on March 26, 2019 (the day of the dismissal) that stated: “In the last two years, the Cook County State’s Attorney’s Office has referred more than 5,700 cases for alternative prosecution.  This is not a new or unusual practice.  An alternative disposition does not mean that there were any problems or infirmities with the case or the evidence…This outcome was met under the same criteria that would occur for and is available to any defendant with similar circumstances.”  State’s Attorney Foxx and Mr. Magats made similar statements during interviews with reporters on March 26 and 27, 2019 respectively.  However, the evidence the OSP developed makes it clear that there are fundamental facts that are inconsistent with the CCSAO, Mr. Magats, and State’s Attorney Foxx’s messaging in at least two ways:
      • The Initial Smollett Case did not fit the criteria the CCSAO’s Chief Data Officer used to identify the cited 5,700 figure because all of those cases were referred to a diversion program, unlike Mr. Smollett’s case; therefore, the resolution of the Initial Smollett Case was meaningfully different from how those 5,700 cases were resolved.
      • There were not thousands of (or, arguably any) similar cases that the CCSAO resolved in a similar way to the Initial Smollett Case.  The CCSAO could not identify any specific similar CCSAO cases it relied upon when resolving the Initial Smollett Case. 
    • The CCSAO and State’s Attorney Foxx made false public statements representing that $10,000 was the most Mr. Smollett could have been ordered to pay in restitution under the law when there is no such cap under the provision of the disorderly conduct statute under which Mr. Smollett was charged, 720 ILCS 5/26-1(a)(4).
    • The CCSAO and State’s Attorney Foxx made false public statements representing that Mr. Smollett had no criminal background, though the CCSAO specifically stated at Mr. Smollett’s bond hearing that Mr. Smollett has a prior misdemeanor conviction out of California from September 22, 2007 for DUI, driving without a license, and giving false information to the police, for which he was placed on 24 months of probation. 
    • After telling reporters on March 27, 2019 that the CCSAO had a strong case and would have prevailed at trial, State’s Attorney Foxx published an op-ed in the Chicago Tribune on March 29, 2019 where she falsely represented that the “office believed the likelihood of securing a conviction was not certain.”
  • Third Finding of Abuse of Discretion: The CCSAO engaged in a substantial abuse of discretion and breached its obligations of honesty and transparency by making false and/or misleading statements to the public regarding State’s Attorney Foxx’s recusal.

Yet, much like the Horowitz report, everyone gets a slap on the wrist for misconduct which ‘didn’t rise to the level of criminal charges’ – except Smollett, who was sued on April 12, 2019 by the city of Chicago for $130,105.15 in overtime that the Chicago PD says they spent chasing down Smollett’s lie. The actor has filed a counter-suit against the city, claiming that he was the victim of “mass public ridicule and harm.”

Then, in February of this year Smollett was re-indicted on six counts related to making false police reports.

via ZeroHedge News https://ift.tt/2E9Sa4G Tyler Durden

Walmart Gives Up All Gains After Company Warns Of Revenue Slowdown Amid Stimulus “Taper”

Walmart Gives Up All Gains After Company Warns Of Revenue Slowdown Amid Stimulus “Taper”

Tyler Durden

Tue, 08/18/2020 – 08:53

After soaring as much a 6.7% premarket following blockbuster earnings that saw non-GAAP EPS print above the highest sellside estimate and comp store sales which came in at 9.9% vs the 6.2% consensus estimate , Walmart shares turned red as investors were spooked by company commentary about the current quarter. Specifically, the selling started after the company unveiled that topline performance slowed in July to around 4%.

According to RBC analyst Scot Ciccarelli, WMT comments that sales begin to “normalize” in July “may suggest that the outsized gains experienced over the last few months may be starting to ebb” as government stimulus money “tapered off.”

He adds that while Wall Street should be expecting a slowdown from the quarter’s “nearly 10% run rate, the magnitude of change may give some investors pause as sales sustainability is one of today’s key topics in retail.” His price target: $132, or just where the company closed on Monday.

Separately, Bloomberg notes that while MKM’s Bill Kirk wrote that the retailer’s “strong” gross margin was a positive sign for peers, he too would be listening for comments on call regarding the “interruption of stimulus checks” impact on August and what Walmart intends to do with its ~$17bn cash balance.

Investors aren’t likely to show ass much patience, and after pushing the stock as high as $144 premarket, it was last trading some $9 lower.

via ZeroHedge News https://ift.tt/3g4MciJ Tyler Durden

“Massively Compromised” – Corporate Debt Issuance Soars To Record Highs

“Massively Compromised” – Corporate Debt Issuance Soars To Record Highs

Tyler Durden

Tue, 08/18/2020 – 08:50

Authored by Bill Blain via MorningPorridge.com,

“Is it possible a cur can lend three thousand ducats?”

Yesterday the US Primary Investment Grade Bond market touched a record $1.346 trillion issuance this year, surpassing the total for 2017, still with the three busiest months in the new issue market to come. The global volume of new corporate debt in the first half of 2020 exceeded $2.5 trillion. It’s a great year to be a new issue debt banker… 

The market volumes have been extraordinary. The rise in US issuance is in no small part due to the Fed’s unlimited liquidity via its investment grade QE programme. The Fed has barely had to buy any debt – the mere promise to do so has been enough. The ECB’s corporate QE Infinity programme has been equally stimulative.

Right across the investment banking multiverse, new issue desks are preparing themselves for an absolute torrent of new corporate debt to hit the markets when the new issue funding season reopens in September. Actually, it hardly closed for a break in August – the demand for high-grade paper to meet cash inflows into bond funds hasn’t abated!

Who would not want to own corporate debt? Central banks have promised to buy anything investment grade. There is no liquidity threat. Back in 2008, bond markets locked tight as it become impossible to sell paper. Bids evaporated in an offered only market. No problem this time – just call the Fed. 

But.. what about returns? 

Well its now an ultra-safe market.. so why worry about returns? (Yes.. you should worry about zero bond returns…) As demand for corporate debt has soared, so have prices, causing the average yield – the Bloomberg Barclays US Aggregate Corporate Index – to drop to 1.82% earlier this month. A record low yield. If you bought the index in March, you’ve made a very healthy return from when it stood at a distressed 4.5%. 

Supply has been fuelled by corporates scrabbling to finance themselves through a Pandemic lockdown of unknown duration. There has been a stampede towards the new issue funding desks. When I was a Debt Capital Markets banker we always told our clients: don’t fund when you have to.. fund when you can. This is a time when they can.. So they have, and they are still funding. 

Rising leverage is another consequence of QE Infinity. The Fed’s promise to provide liquidity means any investment grade corporate can access as much cash as it wants, and is free to spend it as it sees fit. Are the ratings agencies worried? Don’t know, and they don’t particularly seem to care.. but I ain’t reading many headlines about their rising concerns on debt levels. (What I did spot was these oh so clever rating agencies agreeing the EU borrowing €750 trillion to finance Virus recovery is not apparently a worry… Yeah.. Right?)

But, but and but again… Who wants to own corporate debt at sub 2%? 

If you think it’s going to tighten further – then perhaps, but 2% is not a real risk return. Any Risk vs Return calculation has been massively compromised by the absolute low risk-free rate – Treasury bonds. If government bonds yield close to nothing, then it makes anything positive relatively attractive – but still a negative real yield or close to it. If you really think a 100 basis point risk premium is a fair payment for taking corporate risk on a name one step away from junk in the face of this looming recession… then I have some bonds you really should buy. 

Ultra-low interest rates (ZIRP and NIRP) plus unlimited FED liquidity have fuelled the bond binge. Corporates are loving it – Apple recently issued a $8 bln “general corporate purposes” bond we all know will go to funding stock buybacks. I hope Tim Cook thanks the Fed. Apple is getting that money for practically nothing – the 40 year tranche paid 2.5%. (And I will refrain from idle speculation on whether we will still be buying Bright Shiny Things from Apple in 2060.) 

Over the past 10 years, US corporates have spent around $9.2 trillion buying back their stock – money that wasn’t spent on building new factories, infrastructure, products or creating jobs… but boosting the bonuses of executives and dividends to owners… 

My recollection is that $9.2 trillion pretty much equates to 80% of what they’ve borrowed over the past 10-years (sorry, but I don’t have access to a Bloomberg at home to actually dig out the numbers), which means the last 10-years of artificially low Interest Rates has not created a debt-driven boom in corporate investment, product innovation and expansion, but has basically all gone into the pockets of insiders and owners. 

(I should not complain. Apple is my largest PA stock position. But it doesn’t feel right.)

In April Boeing was able to tap the US investment grade market for $25 bln. That enabled it to avoid the embarrassment of going cap in hand to the US government for a bailout. It should see it through to the end of this year of slowed deliveries and making over 10% of its workforce redundant. Over the past 10 years Boeing has been textbook everything that’s rotten with Corporate America – if failed to develop new models, it compromised safety on its 737 Max (killing 346 passengers and crew) instead, and spent most of its profits and new debt on stock buybacks – leaving the company a fractured mess. It will survive – but only because of its criticality to the US economy (1% of GDP in good years) and it’s a massive defence contractor.

And how much of the corporate debt raised in investment grade and junk markets (which similarly benefit from Central Banking largesse via ETF purchases), is going to be Zombie companies with little chance of repaying that debt should condition deteriorate or interest rates rise? (Ie in both good and bad economic scenarios, most Zombies will… “perish”… ahem..)

Basically, the booming new issue bond market is sustained entirely on ZIRP, QE Infinity and the need for Debt Capital Markets Bankers to earn their bonuses by persuading corporates that open markets today means its time to “fill their boots” issuing new debt. The door is open today.. Tomorrow? Maybe not… 

(Or… if you are prepared to free yourself from the shackles of Central Bank liquidity – we have 4-5% yield secured assets, and double digit project finance deals to finance. Real Assets with real yields..)

Finally, might I refer you to my latest Lite-Bite video commentary I’ve done for Shard Capital.

This week I look at the strength of markets in the face of looming Pandemic recession, and propose a dual investment strategy of arbitraging the Central Banks, while building a “risk-off” investment bunker from Gold and Govt Bonds.

via ZeroHedge News https://ift.tt/3azvRl3 Tyler Durden

US Housing Starts, Permits Explode Higher In July With Builder Sentiment At Record

US Housing Starts, Permits Explode Higher In July With Builder Sentiment At Record

Tyler Durden

Tue, 08/18/2020 – 08:40

After screaming higher in May and June (after a 3-month collapse), Housing Starts’ rebound was expected to slow drastically in July (while Building Permits were expected to re-accelerate after a disappointing slowdown in June.

However, the analysts could not have been more wrong as both starts and permits exploded higher in July (up 22.6% vs +5% exp, and 18.8% vs +5.4% exp respectively)…

This is the biggest MoM rise in permits since June 2008 (that didn’t end well) and biggest MoM rise in starts since Oct 2016…

Source: Bloomberg

Multi-family Permits surged from 378k SAAR to 467k and single-family permits exploded from 840k SAAR to 983k SAAR (just shy of the record 999k SAAR in Feb 2020)…

This is the biggest MoM rise in multi-family permits since March 2018..

Source: Bloomberg

And the biggest jump in single-family permits since July 1980…

Source: Bloomberg

Multi-family Starts screamed higher from 349k SAAR to its second-highest ever at 547k SAAR (and single-family starts rose from 869k SAAR to 940kl SAAR)…

Bottom line: The permits surge was much higher in single-family which makes sense with rents tumbling… but the surge in starts was led by multi-family units.

The real ‘V’ is soaring as fast as homebuilder sentiment…

Source: Bloomberg

But sentiment among buyers appears decoupled still from that of the builders…

Source: Bloomberg

If we build they will come… despite tightening mortgage loan standards and depression-era unemployment?

As we previously details, the loan standards for most products – such as C&I loans, residential mortgages and credit cards – were hiked so much they nearly matched the standards during the financial crisis when it was virtually impossible to get any new loans.

This was the second quarter in a row in which loan officers reported sharply tighter financial conditions.

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Would Other Countries Trust a U.S. Government-Controlled Silicon Valley?

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It is easy to see why Americans may be uneasy about Chinese technology companies. Setting aside recent policy efforts to ban or reorient Chinese apps like ByteDance’s TikTok and Tencent’s WeChat, Westerners worry that these companies may engage in certain activities on behalf of the Chinese Communist Party. Laws such as the Cybersecurity Law and Encryption Law do compel Chinese companies to share certain data with the government on request.

It’s easy to see the threats that can emanate from a technology company that is openly aligned with a decidedly non-liberal state, particularly when it is viewed at a competitor or even an enemy. It may be harder to see these same threats coming from the companies or policies native to your own country.

At the same that the U.S. government is cracking down on Chinese technology companies, our legislature is considering new policies that would increase controls on American technology companies.

For example, the EARN IT Act would chip away at platform liability protections in the name of protecting children; if a company does not change its platform upon recommendation of a government panel, it would open itself up to major, possibly debilitating lawsuits.

Then there is the Law Enforcement Access to Encrypted Data Act. This one tries to get at the “unbreakable device” problem by compelling technology companies to … break devices. In other words, it wouldn’t be enough for a technology company to provide standard forensic services to help law enforcement gather evidence from a secure device. If encryption stands in the way, well, developers will just have to compromise it.

These policies bring many downsides for Americans. Crude changes to Section 230 liability protections may result in more content filtering, not less, since platforms would have an incentive to be extra cautious. And of course, undermining encryption always comes at a cost to security, regardless of the justification.

One thing that goes less discussed is how such policies affect the reputation and competitiveness of American technology firms. Not only is Silicon Valley a key engine of U.S. growth and innovation, our technology platforms are viewed as ambassadors for American values and priorities, for better or worse. If people are suspicious of Chinese companies’ links to the CCP, why wouldn’t they also be worried about American companies’ links to our political actors?

I hadn’t thought too much about this dimension of proposed new tech controls until it was brought to my attention by Ashkhen Kazaryan of TechFreedom during our recent panel conversation on these bills for the James Madison Institute. She put it in the context of U.S. jurisprudence, but it’s easy to see how the principle can be extended.

The EARN It Act purports to help crack down on child abuse online. Yet one of the reasons that prosecutors in these cases are even able to get evidence admitted is because technology companies shared it with the government on a voluntary basis. Defense attorneys had previously tried and failed to argue that tech companies have essentially been state actors, and therefore the defendants’ Fourth Amendment rights to due process had been violated. If tech companies are in fact deputized as state actors by legislation like the EARN It Act, these legal arguments could hold more weight in court.

Might non-Americans also view things like the EARN It and Law Enforcement Access to Encrypted Data Acts as ways to cement American tech companies as de facto state actors? It’s plausible. If it’s not these two pieces of legislation in particular, it could be some other proposal to promote good-sounding goals like fairness or representation or national security. To Americans, these pretexts make perfect sense. To a non-American, it looks like another way to weaponize technology companies in ways that benefit state interests.

Actually, this is probably how much of the world has viewed our tech companies for a long time. Edward Snowden’s revelations that Silicon Valley had been deputized as an ersatz surveillance agency for the intelligence community provoked outrage in the States—imagine how much more of a scandal this was for people in other countries that were caught in our web of snooping.

Years later, there is a renewed interest in pardoning Snowden—from President Trump of all people—for what many people view in retrospect as a very patriotic act. One of the controversial phone logging programs revealed through the leaks has since quietly folded for ineffectiveness. FISA reform has largely left the national consciousness. Unfortunately, it is a very good bet that the intelligence community still has access to most of the data from our tech companies that they want.

It may not be as “official” as in China, but American tech company’s the impression that American tech companies serve the interests of the US government is surely not an uncommon opinion in much of the world.

It’s worth keeping this in mind as we debate new controls on technology companies. This is not to say that legislation is never warranted. Rather, we should scrutinize proposals to distinguish public-minded rule-making from government-interested controls. If we don’t, we shouldn’t be surprised if American companies come to be more generally viewed as another, perhaps more liberal, flavor of government-aligned actors.

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