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Authored by Bryce Coward via Knowledge Leaders Capital blog,

We’re going to keep this post short and sweet because the charts speak for themselves.

This week, preliminary Markit PMIs were released for January. Headline numbers ticked up, which is great and shows a continued expansion into the new year. The release also showed that input prices for services exploded higher again, to another all-time high by a wide margin. However, those input prices have not yet fully fed through to prices charged for services.

Given the tight relationship between input prices and prices charged, we would expect prices charged to accelerate higher over the coming months. This makes sense since service providers will naturally seek to protect their margins.

Moreover, core personal consumption expenditure prices, which is the Fed’s preferred inflation indicator, also appears set to move considerably higher in order to catch up to input prices. This has obvious implications for Fed policy. Does the taper discussion continue? Do expectations for rate hikes get moved forward? Or, does the Fed sit back and watch as prices move to and through their inflation target?

They have told us they will do the latter, and we may soon see how strong their commitment is.

The market implications here are pretty straightforward. Tapering is tightening. Bringing rate hike expectations forward is tightening. Allowing inflation to run hot while doing nothing could be seen as de facto easing, which could give even more fuel to the cyclical trade and make those inflation hedges even more attractive.

Senator Rand Paul (R-KY) took to ABC on Sunday morning with George Stephanopoulos to discuss election integrity of the 2020 election, in a discussion which immediately devolved into an inquisition during which Paul was repeatedly pressed to disavow clams that the election was stolen.

Paul not only pushed back – he put Stephanopoulos in his place, accusing the host of ‘inserting yourself in the middle’ and ‘forgetting who you are as a journalist.’

Stephanopoulos began by asking Paul to admit the “election was not stolen” – to which Paul responded by saying “The debate over whether or not there was fraud should occur. We never had any presentation in court where we ever looked at the evidence…”

Paul continued: “There were several states in which the law was changed by the Secretary of State and not the state legislature. To me those are clearly unconstitutional and I think there’s still a chance those do finally work their way up to the Supreme Court.”

“No election is perfect,” Stephanopoulos shot back, telling Paul there were “86 challenges filed by President Trump, all were dismissed”. As Paul tries to argue that many cases were dismissed for lack of standing and not due to examination of evidence, Stephanopoulos responds: “Can’t you just say the words ‘this election wasn’t stolen’?“

‘75% of Republicans want to look at election integrity,’ Paul responds. Stephanopoulos responds by saying that those 75% agree with him because they were “fed a big lie” from the President. 

Paul pushed back, telling Stephanopoulos: “You immediately say everything’s a lie instead of saying there’s two sides to everything. Historically what would happen is if I said I thought there was fraud, you’d interview someone else who said there wasn’t. But now you insert yourself in the middle and say that the absolute fact is that everything I’m saying is a lie.”

“You’re saying there’s no fraud and it’s all been investigated and that’s just not true,” Paul continues, with Stephanopoulos arguing at the same time. Paul then goes into specifics, detailing irregularities in states in like Wisconsin. “I plan on spending the next two years going around, state to state, fixing these problems,” Paul continues. “Let’s have an open debate. It’s a free country!”

“There has been no thorough examination of all states to see what problems we had and see if we could fix them,” Paul says, responding to Stephanopoulos’ claims that Bill Barr pronounced there was “no widespread election fraud”. 

“There’s two sides to every story,” Paul says. “Interview someone on the other side, but don’t insert yourself into the story to say we’re all liars.”

“You’re forgetting who you are as a journalist if you think there’s only one side,” Paul says. “A journalist would hear both sides and there are two sides to this story.”

You can watch the entire 6 minute exchange here:

Pressed repeatedly by @GStephanopoulos, Sen. Rand Paul won’t say the 2020 election wasn’t stolen, calls for investigation of fraud, but doesn’t provide evidence.

GS: “There are not two sides to this story. This has been looked at in every single state.” https://t.co/kEzanF2Ysi pic.twitter.com/DDufLZvwBB

— ABC News (@ABC) January 24, 2021

Election integrity aside, Paul has been a vocal critic of the Biden administration in recent days. On Saturday, we noted  Paul’s interview with Fox host Sean Hannity, where he pummeled the Biden administration’s decision to push for a $15 minimum wage increase that could put 4 million people out of work – leading the Kentucky Republican to exclaim:

“‘Why does Joe Biden hate Black teenagers?’ … Why does Joe Biden want to destroy all of these jobs?”

Paul comments come amid ramblings from various leftist economists who insist that there’s no impact on employment from such a drastic minimum wage hike…

…common sense (and historical experience) for anyone who has ever run an actual business is that raising costs on the lowest-skilled workers in your organization will ripple all the way up, forcing either higher prices to the end-user (eradicating the ‘living wage’ improvement) and or forcing layoffs as management hold margins and reduce costs (the least-skilled first).

Historically speaking, the black unemployment rate is twice that of whites, while minimum wage increases – as we’ve shown repeatedly over the last week – correlate with spikes in job losses just about every single time.

That’s not an “alternative” fact, that’s the awkward reality of ‘unintended consequences’ from nanny-state intervention write large for the last 70 years.

Paul also blasted Biden for canceling the Keystone XL oil pipeline:

“It’s kind of a strange beginning to an administration,” Paul said.

“You’re going to put your best foot forward and the first thing you say is, ‘This is how I’m going to kill jobs’ … ‘I’m going to kill thousands of jobs of the Keystone pipeline with ending it.'”

You can watch that full interview here:

Authored by Eric Balchunas, op-ed via Bloomberg.com,

If President Joe Biden’s nomination of Gary Gensler to lead the Securities and Exchange Commission is confirmed, Gensler should act swiftly to get the agency’s staff moving toward approving a Bitcoin exchange-traded fund, showing that the U.S. not only understands cryptocurrencies but is looking to protect investors and put the country on a level playing field with the rest of the world. This move is long past due.

The SEC is seen as dragging its feet unnecessarily on the issue of approving ETFs that focus on cryptocurrencies. An informal Twitter poll I recently conducted found that almost 80% of the 2,192 people who responded believe the SEC should approve a bitcoin ETF. About 50% would invest in one. I’ve been doing these polls for years and this is the highest by far in favor of approval.

My poll lines up nicely with a Bitwise survey of financial advisors. In that one, 63% of respondents said an ETF was the preferred vehicle to invest in Bitcoin, compared with 16% for directly owning the digital coin and 10% for a mutual fund. People say this not as crypto advocates but as fans and users of the very durable and efficient ETF structure. They would feel the same way if the SEC denied a gold ETF or a China A-share ETF, both of which are great examples of ETFs breaking new ground and successfully democratizing a unique asset class.

Here are five reasons the SEC should approve an ETF:

1. The Premium in Grayscale Bitcoin Investment Trust is Dangerous:

Those seeking a U.S.-based investment vehicle for the digital currency are generally left with a bunch of OTC-traded trusts similar to closed-end funds but without the crucial share creation or redemption process offered by an ETF – a feature that allows for arbitrage.

The most popular is the Grayscale Bitcoin Investment Trust, which has grown from $2 billion to more than $20 billion in assets over the last year. If Grayscale was an ETF, it would rank about 50th in size, putting it in the top 2% of all ETFs. Those that bought shares of the trust over the last year paid an average premium of about 18% more than the value of Bitcoin — and that’s on the low side of where it has traded historically. The premium has been as high as 132% and as low as 3% in recent years. In an ETF, investors know they are getting a price that is going to be very close to the underlying asset.

Of course, a Bitcoin ETF would also likely trade at premium, but it would be microscopic compared with where Grayscale trades. It also would not be subject to artificial forces that tend to push the price of Grayscale’s shares lower even if the price of Bitcoin is rising and vice-versa. History shows us that the premium in an ETF would steadily shrink as more and more professional market-makers get involved.

2. They’ve Worked Fine in Europe:

More than 20 cryptocurrency ETFs already exist outside the U.S., mostly in Europe. Exchange-traded notes such as the Bitcoin Tracker EUR introduced in Sweden over five years ago have typically trade at miniscule premiums thanks to the arbitrage allowed by the share creation/redemption process.

Although a U.S. Bitcoin ETF would be a much bigger deal in terms of volume and assets, it would effectively work the same. And although the premiums and discounts to net asset values are wider than most equity ETFs, they are pretty tight all around and much tighter than Grayscale and the like.

The steep run up – and then down – in Bitcoin prices provided a case study in how a U.S. Bitcoin ETF would react to such sharp moves. Looking at the lot of ETFs and ETNs in Europe, most ended Jan. 11 (following a two-day 17.6% plunge in Bitcoin) at a 3% to 4% discount to net asset value. Clearly, the “arbitrage band” was stretched but it didn’t break. Those who wanted to exit, could. Put that in the U.S. with the biggest and best market makers and my guess is that the discount would have been half as much.

3. There Are Plenty More Volatile ETFs:  

Although there’s no precedent for an ETF tracking a digital asset, the SEC has approved vehicles that are arguably more dangerous in terms of volatility. There are about 70 ETFs that are more volatile than Bitcoin. For example, an ETF approved and launched less than a year ago, the Direxion Daily S&P 500 High Beta Bear 3X Shares ETF, has a 60-day standard deviation between 100% and 200% – depending on the month – while the Swedish Bitcoin ETN is between 25% and 100%.

4. It Would Be Obvious What It Is: 

The risks of a Bitcoin ETF are obvious to average investors, as most have at least some knowledge of cryptocurrencies as being new, alternative and volatile. That suggests it would be less apt to result in a nasty surprise for unknowing investors, which has happened in the past with certain ETFs. One example is the United States Oil ETF, which is akin to a wolf in sheep’s clothing: It has a vanilla name and looks pretty innocent, but it holds futures contracts and most don’t understand how big the costs of “rolling” those contracts can get.

Second, the broader Bitcoin market, which the SEC has said is prone to manipulation and fraud, is becoming more efficient with bigger institutions participating. If anything, having an ETF will speed this along and further help transparency and foster better surveillance of crypto exchanges as they’d compete to attract professional market makers.

5. No Worries About Remembering Password :  

One reason why investors love ETFs is because they are convenient. Any individual investor could replicate any ETF — they literally tell you what they hold every day – and save the expense ratio, but most investors want the convenience. As an added bonus, investors don’t have to worry about losing passwords to digital wallets; they just need to be able to log into a brokerage account.

During the final months of the Trump administration Chinese military exercises near Taiwan grew as part of the tit-for-tat escalation of Washington moves in support of the self-declared Republic. However, in a show of (preemptive) force against the new Biden admin, which echoed Mike Pompeo in accusing China of committing genocide against Uyghurs – an allegation that Beijing will not gloss over – Chinese hostilities in the vicinity of Taiwan have escalated dramatically. And on Sunday, just one day after China’s military undertook one of its biggest Taiwan “flyovers” yet (and just days following President Joe Biden’s entry into the White House), Chinese air force planes including 12 fighter jets entered Taiwan’s air defense identification zone (ADIZ) for a second day.

As we reported yesterday, China’s activities over the weekend mark a ratcheting up with fighters and bombers being dispatched rather than reconnaissance aircraft as had generally been the case in recent weeks. On Saturday, eight Chinese bomber planes, four fighter jets and anti-submarine aircraft one flew into Taiwan’s defense zone on Saturday, between mainland Taiwan and the Taiwan-controlled Pratas Islands in the South China Sea. Then, on Sunday, a further 15 flew into the same air space on Sunday.

Taiwan’s Defense Ministry said China sent six J-10 fighters, four J-16s, two SU-30s, a Y-8 reconnaissance aircraft and two Y-8 anti-submarine aircrat, adding that Taiwan’s air force was sent up to respond.

“Airborne alert sorties had been tasked, radio warnings issued and air defense missile systems deployed to monitor the activity,” the ministry said.

A map provided by Taiwan’s defense ministry showed that the Chinese aircraft flew over the same waters where the most recent Chinese missions have been taking place near the Pratas Islands, though still well away from mainland Taiwan.

And so with fighter jets from both countries now on the verge of engaging above Taiwan’s ADIZ, we are one false flag “accidental” missile discharge from all out war.

While China has yet to comment, It has previously said such actions are aimed at defending the country’s sovereignty and designed to act as a warning against “collusion” between the United States and Taiwan.

As Reuters notes, the move is likely to further concern Washington, which on Saturday urged China to stop pressuring Taiwan and reaffirmed its commitment to the island and desire to deepen ties.

Meanwhile, in a potential harbinger of a far bigger conflict, earlier on Sunday, the US military said that a US aircraft carrier group led by the USS Theodore Roosevelt had entered the disputed South China Sea to promote “freedom of the seas”, and to also telegraph the US preparedness to support Taiwan in a worst case scenario.

The United States, like most countries, has no formal diplomatic ties with Taiwan, but is bound by law to provide the island with the means to defend itself. In a final swipe at China, the Trump administration’s outgoing UN ambassador tweeted that it’s time for the world to oppose China’s efforts to exclude and isolate Taiwan, drawing sharp criticism from Beijing.

Ambassador Kelly Craft accompanied the tweet with a photo of herself in the UN general assembly hall, from where the island is banned. She carried a handbag with a stuffed Taiwan bear sticking out of the top, a gift from Taiwan’s representative in New York, James Lee.

And while Biden’s administration has rushed to undo much of Trump’s legacy, it has shown little sign of reducing pressure on China, although it is seen as favoring a return to more civil dialogue. In another sign of support for Taiwan, the island’s de-facto ambassador to Washington, Hsiao Bi-khim, was an invited guest at Biden’s inauguration.

President Biden’s newly sworn-in administration on Saturday reaffirmed the US’s “rock-solid” commitment to helping Taiwan defend itself in its first comments on the sensitive territorial dispute, noting “with concern the pattern of [China’s] ongoing attempts to intimidate its neighbours, including Taiwan.”

“We urge Beijing to cease its military, diplomatic, and economic pressure against Taiwan and instead engage in meaningful dialogue with Taiwan’s democratically elected representatives,” State Department spokesperson Ned Price said in the statement.

Authored by Beth Baumann via Townhall.com (emphasis ours),

Now that President Donald Trump has left the White House, many Americans are wondering what he plans to do next. There have been rumors about him starting a new political party, known as the Patriot Party. But, according to one of his key advisors, Jason Miller, Trump plans to focus on something bigger and far more important: election integrity.

Just one day after boarding Air Force One with the Trump family on their venture from Washington, D.C. to Mar-a-Lago, Miller told “Just the News AM” that the former president has a couple of goals over the next few years, including “winning back the House and the Senate for Republicans in 2022 to make sure that we can stop the Democratic craziness.“

“You’re also going to see him emerge as the nation’s leader on ballot and voting integrity,” he said.

According to Miller, Trump wants to focus on voter integrity but that work will never take place in Washington, D.C. because Democrats don’t believe there is a threat to America’s elections. Instead, Trump is likely to work with individual states and state legislatures to create reforms. 

“As we saw, an important thing to keep in mind, so much of our debate between the election and up until a couple weeks ago was over these Article 2 abuses and the Constitution, where only the state legislatures can actually go and set” the rules for mail-in voting, Miller explained.

“This is something we’re going to start ramping up, not immediately. We’ll give them a little bit of a transition period but this is critical and we have to do it,” he said.

Even though President Biden has come out in full swing with executive orders since he took office on Wednesday, Miller said Republicans could do things legislatively to counteract his measures, but it’s highly unlikely.

“A number of things could be done legislatively but I think President Trump also looks at Capitol Hill and realizes Democrats are in charge of both the House and the Senate and, quite frankly though, even if we had Republicans controlling much of this, they might go to block some of these things. We see how the D.C. insiders are just slow to move,” he explained. “I mean, how many years did Republicans sit there and do nothing about Section 230 abuses? How many years did Republicans sit there on Capitol Hill, even though we had both the House and the Senate, and never did anything about the spying and cheating that we saw from President Obama and his administration, everything he did in the transition in 2016 when Joe Biden was screaming, ‘Logan Act’ and all the abuses we saw Susan Rice and all the other things. Republicans never got to the bottom of that.“

Baltimore/Washington International Thurgood Marshall Airport (BWI) has welcomed in the new year with Light Detection and Ranging (LiDAR) technology informing travelers at one security checkpoint whether they’re properly social distancing, according to Airport World. 

The LiDAR technology measures travelers’ movements with laser sensors, including the number of people waiting in line. Automated tracking software firm CrowdVision installed the new sophisticated technology at Security Checkpoint B of BWI. 

The system notifies travelers on a giant screen whether social distancing is satisfactory. If lines at the security checkpoint are too dense, the system will encourage those waiting in line to practice more social distancing. 

“Safe, healthy travel remains our priority,” said BWI’s executive director, Ricky Smith.

“Since the outset of the pandemic, BWI Marshall Airport has implemented many measures to help protect passengers and employees. This innovation provides real-time data on passenger flow so we can notify travelers and manage separation,” Smith said. 

Among other global airports, BWI could be one of the first to embrace LiDAR technology to enforce social distancing. 

“Our software solution helps BWI Marshall Airport improve their passengers’ travel experience and, more importantly, keeps them safe and gets them flying again,” said Mike Cunningham, president of CrowdVision.

The future of travel appears to be one that is a disturbing monolithic surveillance grid that tracks everyone. 

Under the guise of the pandemic, the surveillance state is quickly embracing new technologies to monitor not just travelers but eventually everyone. 

Authored by Lance Roberts via RealInvestmentAdvice.com,

Bulls Push Stocks To New Highs

What better way to celebrate a new President than to push stocks to new all-time highs? On Wednesday, the market surged as Joe Biden got sworn in as the 46th President of the United States. Interestingly, it was a rotation from the reflation trade back into the “Old Gaurd” of the FANG stocks that led the way.

In fact, despite hopes that the reflation trade would be the thing, it has been just the opposite. The chart below is the differential in performance over the last week between market-cap and equal-weighted markets. (FANG dominates market cap whereas equal-weight has a much larger weighting in industrials)

Notably, that rotation is a function of money managers repositioning portfolios to reduce risk. The risk gets reduced by moving from significantly extended and deviated areas of the market back to less extended or oversold segments. As noted last week, there is nothing screaming risk more at the moment than the small-cap sector.

Markets Queuing Up For A Correction

Currently, managers can’t afford to be out of the market and potentially suffer a performance drag. So, the rotation in the market reduces risk while still maintaining exposure to equities. However, as discussed last week, there is ample evidence that “everyone is currently in the pool.”  Such leaves the market vulnerable to three risks:

1. More stimulus and direct checks into the economy lead to an inflationary spike that causes the Fed to discuss hiking rates and tapering QE.

2. The current rise in interest rates continues over higher inflation concerns until it impacts a debt-laden economy causing the Fed to implement “yield curve control.” 

3. The dollar, which has an enormous net-short position against it, reverses moves higher, pulling in foreign reserves, causing a short-squeeze on the dollar. 

The reality is that both a rise in the dollar, with higher yields, is likely to start attracting reserves from countries faced with economic weakness and negative-yielding debt. Such would quickly reverse the tailwinds that have supported the equity rally since March.

In the following video, we discuss why the markets are setting up for a correction over the next month of 3-5%. (We publish a daily 3-minute video click here to subscribe)

Important Note: A correction can take on one of two forms. The market either declines in price to alleviate the overbought condition, or it can consolidate sideways.

The Fed Broke It

In his latest letter to investors, The Financial Times reported that Seth Klarman of Baupost Capital blamed the world’s central banks for flooding the financial system with liquidity masking the US economy’s real health. To wit:

“With so much stimulus being deployed, trying to figure out if the economy is in recession is like trying to assess if you had a fever after you just took a large dose of aspirin. But as with frogs in water that is slowly being heated to a boil, investors are being conditioned not to recognise the danger.”

While the entire article is worth a read, his point is what we addressed previously in “Moral Hazard.”  What exactly is the definition of “moral hazard.”

Noun – ECONOMICS
“The lack of incentive to guard against risk where one is protected from its consequences, e.g., by insurance.”

Take a look at the following chart, which is a clear example of investors adopting the idea of “insurance” against loss. (Charts courtesy of ZeroHedge)

Of course, given the price-to-sales ratio is at a record high, such also suggests that investors are vastly overpaying for future outcomes. When there is a lack of perceived risk, the outcome has always ended poorly without exception.

More Of The Same

As Seth Klarman notes, it is the unprecedented flood of global liquidity that is driving the mayhem.

“The Fed’s policies and programs have directly contributed to exceptionally benign market conditions where nearly everything is bid up while downside volatility is truncated.”

While The Fed’s drastic measures have arguably helped to boost economic activity and rescue ailing businesses (or more correctly, raise stock prices enabling issuance and collapse yields and spreads enabling issuance), Klarman warns:

“They have also kindled two dangerous ideas: that fiscal deficits don’t matter, and that no matter how much debt is outstanding, we can effortlessly, safely, and reliably pile on more.”

Unfortunately, 40-years of history have already shown us the problem with debts and deficits in economic prosperity for the masses.

Another decade of the same should about finish the job.

Signs Of Enthusiasm

Sentiment Trader had a great piece out on Thursday discussing sentiment and enthusiasm.

“The biggest challenge with this market, one we haven’t really ever had to deal with before, is the conflict between an impressive recovery from a historic selloff, superimposed against a backdrop of record levels of speculative activity.

Recoveries from a bear market typically take much longer. By the time they’ve recovered and been at new highs for a while, speculation comes in, markets plateau, divergences form, and sentiment cycles back down during a correction.

If we look at a typical Sentiment Cycle, then we basically went from enthusiasm to panic and right back to enthusiasm, all in record time.”

“There is little arguing that we’re in this part of the cycle. As the Knowledge Base article, “How do I use sentiment?” points out, this part of the cycle is identified by:

• High optimism – CHECK

• Easy credit (too easy, with loose terms) – CHECK

• A rush of initial and secondary offerings –CHECK

• Risky stocks outperforming – CHECK

• Stretched valuations – CHECK

All boxes are checked there. More objectively, when we look at the correlation between the S&P 500’s price path lately versus the Enthusiasm phase of past cycles, there is a high positive correlation.”

Investors Are There

While none of this suggests the markets are about to crash, it does indicate that short-term risk/reward is not favorable currently. As SentimenTrader summed up:

“Sentiment is horrifically extreme and almost all signs are present, screaming at us that we’re seeing the kinds of behavior that are almost solely and universally seen at medium-term peaks in stocks.”

As noted above, a short- to intermediate-term correction to reduce current levels of exuberance would be a healthy thing. Longer-term, the dynamics to support a continuation of the bull market will become more challenging, particularly if inflation and interest rates start to push higher.

Our Job As Investors

Remember, our job as investors is pretty simple – protect our investment capital from short-term destruction so that we can play the long-term investment game.

• Capital preservation

• A rate of return sufficient to keep pace with the rate of inflation.

• Expectations based on realistic objectives.  (The market does not compound at 8%, 6% or 4%)

• Higher rates of return require an exponential increase in the underlying risk profile.  This tends to not work out well.

• You can replace lost capital – but you can’t replace lost time.  Time is a precious commodity that you cannot afford to waste.

• Portfolios are time-frame specific. If you have a 5-years to retirement but build a portfolio with a 20-year time horizon (taking on more risk) the results will likely be disastrous.

With forward returns likely to be lower and more volatile than witnessed over the last decade, the need for a more conservative approach is rising. Controlling risk, reducing emotional investment mistakes, and limiting investment capital’s destruction will likely be the real formula for investment success in the coming decade.

Here’s the summary of what happened Saturday night after a Tacoma, Washington, police officer used his cruiser to plow through a crowd of people: 

• Tacoma officer responded to an illegal street race in downtown Tacoma. 

• The crowd swarmed the police cruiser.

• The police warned the crowd surrounding the vehicle.

• The officer appeared to panic to evade the crowd and struck a group of people.

• Tacoma Police are handing off the investigation to the Pierce County Force Investigation Team. 

 A Tacoma, Washington, police cruiser plowed through a group of people after responding to a report of street racing in the downtown district. 

The 42-second video shows at least 100 people at an illegal street racing event around South 900 Block of Pacific Avenue. At the beginning of the clip, dense white smoke can be seen as street racers perform donut maneuvers in the middle of the intersection.

Tacoma News Tribune interviewed “Mark,” an eyewitness of the incident, and is one of the bystanders who shot the video. He said at least “five to six cars spinning in circles on South 9th Street between the intersections of Court A and Pacific Avenue” before the police cruiser arrived. 

Traffic in the area came to a standstill as the street racers performed donuts in the intersection. Mark said a firetruck initially tried to break up the illegal gathering but everyone regrouped. 

When the police cruiser arrived on the scene, Mark said, “A lot of people swarmed in that direction (of the police car).” They intended to block him.”

The officer laid on his bullhorn, revved his engine, and backed up in the attempt to disperse the crowd who had surrounded his vehicle. He then shifted the vehicle forward and stepped on the gas, hitting numerous people. A couple of other views of the incident are shown below. 

pic.twitter.com/3v5jGFVGXg

— J̵̟̦̲̞̭̱̀̈́͑̄̇̈́̚͝ustice (@The_Justice7) January 24, 2021

Tacoma police spokeswoman, Officer Wendy Haddow, said reports of street racers in the downtown district began pouring in around the evening. She said at least 100 folks were in attendance at the unlawful gathering. 

Haddow said the officer who arrived on the scene panicked when the crowd attempted to surround his vehicle. 

“He was afraid they would break his glass,” she said. That prompted him to speed out of the scene for his safety.

Haddow said one person who was struck sustained a laceration in the collision and was transported to a local hospital.

City Manager Elizabeth Pauli told The Tribune that the officer involved has been placed on leave. She said the case will be turned over to the Pierce County Force Investigation Team.

“The most important thing to know is we’re very concerned of any injuries this evening,” Pauli said. She told the local newspaper that at least one person was transported to the hospital but conditions are unknown at the moment. 

Pauli said she is very concerned about police officers using deadly force. Once the investigation is complete, she said she’ll take appropriate action if needed. 

Following the incident, Tacoma Police released a statement: 

“At approximately 6:19 p.m. this evening, South Sound 911 received numerous reports of an incident occurring at the intersection of South 9th and Pacific Avenue in Tacoma. There were multiple vehicles and approximately 100 people present blocking the intersection when officers arrived on scene. Tacoma Police officers responding to the location began clearing the intersection of vehicles and people for the safety of those gathered and people trying to use the street.

“During the operation, a responding Tacoma police vehicle was surrounded by the crowd. People hit the body of the police vehicle and its windows as the officer was stopped in the street. The officer, fearing for his safety, tried to back up, but was unable to do so because of the crowd. The officer had his lights and sirens activated.

“While trying to extricate himself from an unsafe position, the officer drove forward striking one individual and may have impacted others. The officer stopped at a point of safety and called for medical aid. One person was transported to an area hospital. That person’s condition is, at this time, unknown.

“Tacoma Police Department has contacted the Pierce County Force Investigation Team (PCFIT) and turned the investigation over to them to conduct an independent investigation of this incident.”

Is this what happens when mainstream media make it their agenda to formulate a narrative that inspires citizens to disrespect the police? It will be interesting to see how Biden and AOC respond to this.