Tag: finance

Authored by Ryan McMaken via The Mises Institute,

The official line on vaccines is that they are extremely effective at protecting against serious illness. And yet, these same people are also claiming that the unvaccinated are a major threat to the vaccinated.

More specifically, President Biden claimed on September 10 that vaccine mandates were to “protect the vaccinated workers from unvaccinated workers.”

In other words, it is claimed that vaccines are remarkably effective, and that the vaccinated must also be protected from the unvaccinated. How can both claims be true at the same time? They can’t. The idea that vaccinated people are being frequently harmed by the unvaccinated is a complete fabrication, based on the pro-mandate crowd’s own mainstream data.

As Robert Fellner points out, according to the official data,

The odds of a vaccinated person dying from COVID are 1 in 137,000.

The fatality rate for seasonal flu, meanwhile, is at least 100 times greater than that. The chance of dying in an automobile accident is over 1,000 times greater. Dog attacks, bee stings, sunstroke, cataclysmic storms, and a variety of other background risks we accept as a normal part of life are all more deadly than the risk COVID poses to the vaccinated.

Moreover, the risk of death to vaccinated people is similar to the risk of having an adverse side effect to the vaccine. And as the spokesmen for Big Pharma and the regime never tire of telling us, you shouldn’t care about having an adverse reaction, because it is so very rare and inconsequential.

So by that reasoning, vaccinated people shouldn’t worry about getting very ill from covid. Those cases are just as rare as the so, so rare cases of adverse reaction.

And yet, even after all of this, the backers of vaccine mandates are trying to whip up hysteria about how we must “protect the vaccinated” who are in grave danger thanks to the unvaccinated.

The level of mental and logical incoherence necessary to come to this conclusion is quite a feat.

It Doesn’t Stop the Spread

It must also be remembered that vaccination does not stop the spread of covid. 

Fellner continues:

But as [the CDC’s] Dr. Walensky explained last month, while the COVID vaccines remain incredibly effective at preventing serious illness and death, “what they cannot do anymore is prevent transmission.” This reflects the official position of the agency as well, which is why the CDC now requires vaccinated people to mask indoors and follow the same type of social distancing practices as unvaccinated people.

The official confirmation that COVID is endemic, and vaccination cannot stop transmission and thereby eliminate it in the way it could for things like polio and smallpox, makes mandates intolerable to a free society. The entire argument for mandatory vaccination originally rested on the claim that the vaccines could reliably stop transmission.

Moreover, those who are vaccinated often experience a mild form of covid when they are re-infected, which means they often spread the disease without even knowing they have it. The vaccinated also carry the same viral load as the unvaccinated, as noted last month by the UK’s Evening Standard:

While evidence demonstrates that vaccines significantly reduce hospitalisations and deaths, scientists now believe those infected by the Delta variant can still harbour similar levels of virus to those who are unvaccinated.

Previous thinking was that vaccinations would stop the spread, but now,

[T]his has been thrown into doubt and raises questions about vaccine passports … which work on the assumption that double-jabbed people are less likely to spread the virus.

Yet again, we see the notion that the vaccinated are being endangered by the unvaccinated is a fantasy of the mandate activists.

At least the CDC is being logical when it says the vaccinated should keep wearing masks. Indeed, every time we hear this from the CDC we should remind ourselves: vaccination does not stop the spread.

They’re Filling Up the Hospitals! 

There is a secondary fallback position the mandate pushers also use: that the unvaccinated are taking up all the intensive care beds and therefore denying people with other conditions the hospital beds that are allegedly more deserved by others.

As I pointed out here, this is also an inconsistent argument since this arguments rests on the idea that people who make unhealthy choices (like not taking a vaccine) ought to be treated as pariahs.

This only applies to one single “unhealthy choice.” These mandate pushers are apparently perfectly fine with drug abusers, smokers, and morbidly obese victims of Type-2 diabetes—the numbers of whom have been multiplying— filling up all the ICU beds. No, those people deserve their hospital beds even though they made the choice to destroy their own health. In fact if one suggests people lay off the meth pipe, the Big Gulps, or the Marlboros—in an effort to improve health—one is an intolerable “fat shamer” or someone who blames the victims. 

In any case, recent data has also emerged questioning whether or not the data on hospitalizations is very useful in identifying the load imposed on ICUs by covid patients. 

A recent study showed that nearly half (i.e., 48 percent) of covid hospitalizations in 2020 were mild cases. According to The Atlantic (not exactly a hotbed of anti-vaccine rhetoric): 

The study found that from March 2020 through early January 2021—before vaccination was widespread, and before the Delta variant had arrived—the proportion of patients with mild or asymptomatic disease was 36 percent. From mid-January through the end of June 2021, however, that number rose to 48 percent. In other words, the study suggests that roughly half of all the hospitalized patients showing up on COVID-data dashboards in 2021 may have been admitted for another reason entirely, or had only a mild presentation of disease.

And why are there fewer severe cases now? It may be because “unvaccinated patients in the vaccine era tend to be a younger cohort who are less vulnerable to COVID and may be more likely to have been infected in the past.” 

Get Vaccinated Even If You Already Had Covid!

But no matter! All that matters is getting people vaccinated, and it’s all for your own good, and governments ought to be able to force medications on you. The cynical refrain of the pro-abortion Left, “get your laws off my body” only applies to one single case. In every other case, the state owns you.

This drive for vaccination no matter what can also be seen in the effort to vaccinate even those who have already recovered from covid. The claim here is that those who natural immunity should get jabbed because they have a higher incidence of reinfection—although it is admitted cases of reinfection tend to be far milder than the initial case.

Specifically, those pushing vaccination in this case may point to a study suggesting the unvaccinated are 2.34 times more likely to be reinfected than the vaccinated.

Yet, according to the pro-mandate crowd, this is 2.34 times larger than an extremely small number. After all, we’re frequently told that cases of reinfection for the vaccinated are “extremely rare” and inconsequential. So, that means for the unvaccinated, the odds of reinfection are a little more than double an inconsequential number. Now, I don’t have a degree in mathematics, but I have taken enough calculus and statistics classes to know that 2.3 times “basically zero” is also “basically zero.”

But that is the math being used by those who insist that the risk of reinfection for the vaccinated is negligible, while the risk of reinfection for the already-recovered is an enormous public health crisis.

According to the mandate pushers’ own data, the drive to protect the vaccinated from the unvaccinated makes no sense at all. But I suspect they’ll stick with the slogan, or even double down on it. 

Authored by Matt Taibbi via TK News,

It was impossible to mistake the tone of Joe Biden’s announcement of a vaccine mandate last week. It was an angry speech, which started by explaining that “many of us are frustrated with the nearly 80 million Americans who are still not vaccinated,” and went on to announce that “our patience is wearing thin,” and “your refusal has cost all of us.” Biden, not normally one for oratorial effects, even conveyed a sense of barely contained rage by muttering, “Get vaccinated!” as he walked off the stage.

“Enjoying the angry Dad vibes from this Biden speech,” came the cheerful comment of former Justice Department spokesman and MSNBC analyst Matthew Miller:

Enjoying the angry dad vibes from this Biden speech. He is turning the damn car around.

— Matthew Miller (@matthewamiller) September 9, 2021

Who’d attracted Biden’s anger — the unvaccinated — was clear. The why was more confusing. The president decried how “the unvaccinated overcrowd our hospitals… leaving no room for someone with a heart attack or pancreatitis or cancer,” a legitimate enough point. But after reassuring those who’d “done their part” that just “one out of every 160,000 fully vaccinated Americans was hospitalized” this summer, Biden nonetheless explained that “a distinct minority of Americans” is “causing unvaccinated people to die.” He added: “We’re going to protect the vaccinated from unvaccinated co-workers.”

As many noted, the statements were contradictory. If the vaccine really is that effective, the overwhelming consequences of of any failure to get vaccinated will be borne by the unvaccinated themselves. But Biden’s speech was as much about directing anger as policy. The mandate was an extraordinary step, but Biden’s unique — and uniquely strange — rhetorical setup, which framed the decision as a way to stop “them” from doing “damage” and killing “us,” was just as big a story.

The arrival of Covid-19 has exacerbated a troubling divide that’s been growing in America for decades, and is elucidated at length in Michael Sandel’s recent The Tyranny of Merit. The book tells a politically unsettling story about meritocracy in America, one that runs counter to prevailing narratives on both the left and the right. Though mention of Covid-19 is limited to a few paragraphs in a new prologue, the pandemic in many ways has become the ultimate test case of Sandel’s thesis: that we Americans have been so conditioned to believe that winners deserve to win that we’ve found ways to hate losers of any kind as moral failures, even when life is at stake, and especially when lack of education is seen as a factor.

It’s not remotely the same kind of book, but The Tyranny of Merit does follow up on themes in Christopher Lasch’s The Culture of Narcissism. Lasch’s late seventies premise described American society devolved into a ceaseless all-against-all competition on all fronts, from the professional to the physical to the social and sexual and beyond. Moreover, Lasch wrote, if the original “American dream” was imbued with at least some vague ideas that success should be tied to virtues like thrift, discipline, and wisdom, by the disco age “the pursuit of wealth lost the few shreds of moral meaning.”

In the time since Lasch’s iconic treatise, though, relentless messaging campaigns emanating from both sides of the political aisle re-emphasized the idea that material success was tied to moral character. Ronald Reagan evangelized the idea that poverty was mostly a deserved state, and government at most owed those who weren’t to blame for their own problems. When Bill Clinton came along, he took Reagan’s finger-wagging moralizing and re-cast it in the cheery new technocratic language of global capitalism. “We must do what America does best,” Clinton said at his inauguration. “Offer more opportunity to all and demand more responsibility from all.”

Clinton’s formula was really Yin to Reagan’s Yang: in a world that offered more “opportunity,” there was now even less excuse for failure. We forget, because the pre-9/11 world seems so long ago, but Clinton-era editorialists spent much of the late nineties hyping the opportunity gospel. We were told a combination of the Internet and an increasingly integrated international economy created vast new worlds of material possibility, for those willing to “fill the unforgiving minute” and run the race. “If globalization were a sport,” wrote an exultant Thomas Friedman in 1999, “it would be the 100-yard dash, over and over and over. And no matter how many times you win, you have to race again the next day.”

Onetime labor parties paradoxically were the biggest boosters of the new hyper-competitive global economy, whose central feature was forcing Western workers to face off against masses of laborers in China, South Asia, Mexico, and other places where political rights were, shall we say, less of a priority. As the stress on former blue-collar workers intensified, politicians often sold the public on the idea that higher learning was their Golden Ticket out of the miseries of debt, higher medical costs, and especially social immobility.

By the time Barack Obama came along, it was axiomatic among the cosmopolitan set that anyone with enough ingenuity and entrepreneurial energy should be able to get ahead. Sandel amusingly points out that Obama often culled from a Sly and the Family Stone song in describing his vision of modern American capitalism, using the phrase “You can make it if you try” 140 times during his presidency:

The explosive and uncomfortable message at the heart of The Tyranny of Meritocracy is the idea that the resulting political divide is now less about ideology than education. Sandel deserves credit for taking on a subject that almost no one in high society wants to hear about, let alone those in the academic world. Forget red versus blue: he shows the real gulf is between those who have diplomas, and those who don’t. The subtext is that people with the right degrees deserve to be rich, and have health insurance, and good schooling for their kids, and dignified work, while those who threw away their books after high school deserve failure, in the same way smokers deserve lung disease — especially if they make unsanctioned political choices.

This is an excerpt from today’s subscriber-only post. To read the entire article and get full access to the archives, you can subscribe for $5 a month or $50 a year.

In order to obtain a religious exemption from the Covid-19 vaccine at a hospital system in Arkansas, staff  are also required to “swear off” common medicines like Tylenol, Tums and Preparation H. 

Conway Regional Health System said it noticed an uptick in vaccine exemption requests that “cited the use of fetal cell lines in the development and testing of the vaccines,” according to ARS Technica.

Matt Troup, president and CEO of Conway Regional Health System, said: “This was significantly disproportionate to what we’ve seen with the influenza vaccine.”

He continued: “Thus, we provided a religious attestation form for those individuals requesting a religious exemption.” This attestation includes a list of about 30 common medicines that “fall into the same category as the COVID-19 vaccine in their use of fetal cell lines.”

ARS Technica reported that some of the common medicines on the list include Tylenol, Pepto Bismol, aspirin, Tums, Lipitor, Senokot, Motrin, ibuprofen, Maalox, Ex-Lax, Benadryl, Sudafed, albuterol, Preparation H, MMR vaccine, Claritin, Zoloft, Prilosec OTC, and azithromycin.

Employees then must attest they “truthfully acknowledge and affirm that my sincerely held religious belief is consistent and true”. 

Troup said that the hospital wants to make sure that staff are “sincere” in their beliefs and that the hospital wants to “educate staff who might have requested an exemption without understanding the full scope of how fetal cells are used in testing and development in common medicines.”

Employees that don’t sign the form are only granted provisional exemptions. Troup said 5% of the hospital’s staff has filed for such an exemption. 

“A lot of this, I believe, is a hesitancy about the vaccine, and so that’s a separate issue than a religious exemption,” he concluded.

Authored by Dave DeCamp via AntiWar.com,

Secretary of State Antony Blinken said Friday that the US would continue to push Arab states to normalize relations with Israel. This month marked the one-year anniversary of the signing of Trump administration-brokered agreements that normalized relations with Israel and the UAE, and Bahrain, known as the Abraham Accords.

Following the UAE, Morocco also normalized with Israel. Sudan agreed with Israel to open relations, but Khartoum has been slow to establish diplomatic ties. “We will encourage more countries to follow the lead of the Emirates, Bahrain, and Morocco,” Blinken said during a virtual meeting with the countries’ ministers.

While touted as peace deals, the Abraham Accords will lead to an influx of more US arms in the region and have failed to slow Israel’s de facto annexation of the West Bank through settlements and Israel’s brutality against the people of Gaza.

For agreeing to normalize with Israel, the UAE was awarded a $23 billion weapons deal that includes F-35 fighter jets that the Biden administration briefly paused but then decided to proceed with. For Morrocco, the US recognized Muskat’s sovereignty over the disputed Western Sahara region, another move President Biden will not reverse.

The Trump administration pressured Khartoum into normalizing with Israel by adding it as a condition to get Sudan removed from the US terror list. To be removed from the list, the US made Sudan pay $335 million in compensation to victims of the 1998 US embassy bombings in Kenya and Tanzania that were carried out by al-Qaeda, even though Osama bin Laden was kicked out of Sudan in 1996.

The Clinton administration bombed a pharmaceutical factory in Sudan in response to the embassy attacks, something the US never even apologized for.

A major aspect of the Abraham Accords is to isolate Iran. According to Israeli media, Israeli Prime Minister Naftali Bennett floated the idea to President Biden of an anti-Iran NATO-style alliance in the Middle East that includes Israel and Arab states opposed to Iran. Earlier this year, there were reports that Israel was in talks with Bahrain, the UAE, and Saudi Arabia about the idea of an anti-Iran alliance.

It was a busy week for crypto, with many updates in JPMorgan’s weekly Crypto Weekly note. Here are the highlights:

• Bitcoin and ether prices rise in the week. The price of bitcoin and ether rose by about 4% w/w and 6% w/w to $48.1K and $3.6K, respectively. This recovery follows the price decline across major cryptocurrencies after a selloff in the last week. The price of ether gained following the news of its co-founder Vitalik Buterin making it to the TIME’s ‘Most Influential’ List.
• Trading volume of major cryptocurrencies decline w/w. The average daily volume (ADV) of Bitcoin and Ether declined by 18% and 21% w/w, respectively, as did volatility. The ADV of Litecoin, Dogecoin and Uniswap also declined during the week.
• At the Senate hearing, SEC Chair Gary Gensler reiterated that most cryptocurrencies, including stablecoins, qualify as securities, which should not be sold without proper risk disclosures. He also said that crypto lending and staking services are likely to fall under SEC’s jurisdiction as lending products come under the securities laws.

The size of the global market increased in the past week, with the global crypto sector’s market cap increasing 2.2% w/w from $2.1 trillion to $2.2 trillion as of 9/16.

A snapshot of the key regulatory updates this week:

It continues to be a busy time for crypto adoption by financial institutions. Among the notable developments:

• Interactive Brokers will start offering cryptocurrency trading and custody services for Bitcoin, Ethereum, Litecoin and Bitcoin Cash.
• Fidelity Digital Assets plans to increase its headcount by up to 70% between April and year-end. It also plans to offer yield funds and other products related to stablecoins or decentralized finance (DeFi) coins.
• The Fairfax County pension funds will invest a total of $50 million in a fund which invests in digital tokens and cryptocurrency derivatives. Earlier this year, the pension funds also invested in a crypto venture capital fund.
• Franklin Templeton is raising $20 million for the firm’s first blockchain VC fund. The fund was already raised $10 million from a single sale. The firm is also recruiting engineers in “tokenized asset development department.”

There was also a flurry of news on the adoption by non-financial services companies, including AMC Theaters accepting most cryptos, Googles announcing the development of an NBA-linked blockchain, Square joining the open invention network, and Paris Saint Germain announcing crypto.com as its official cryptocurrency partner.

Which brings us to the main story: according to JPMorgan, the second quarter of 2021 saw an increase in DeFi adoption by institutional investors as more than 60% of all DeFi transactions were over $10 million versus less than half in the broader crypto market. Institutions in major economies are driving the DeFi activity as emerging markets are still adopting traditional crypto assets.

Huobi Ventures announces a $10mm GameFi fund (9/14) to invest in projects developing blockchain based games with “play-to-earn” features such as those in Axie Infinity. Huobi also set up a $100mm DeFi fund and a $10mm NFT fund in May.

Total Value Locked (TVL) Across DeFi Projects is rising. Total value locked (TVL) refers to the total dollar amount of assets that is staked or “locked” up across all DeFi protocols. Put differently, TVL does not refer to transaction volumes or market cap of cryptocurrencies but rather the value of reserves that are “locked” into smart contracts. TVL can help assess the health of the entire DeFi ecosystem or a specific DeFi project or app. This value does not represent any leverage created by the underlying crypto assets. In traditional finance, this could be thought of as deposits in the banking system. Examples of assets included in total value locked include crypto assets staked in yield protocols (ex. depositors earn yield on staked crypto), lending protocols (ex. borrowers post collateral for loans), staked in automated market maker exchanges (ex. liquidity pools for decentralized exchanges), and underlying synthetic assets. As of 9/16/2021, total value locked in DeFi protocols stands at $90.6B.

Authored by Mark Glennon via Wirepoints.org,

It’s perhaps the most effective way to save your life if you are infected with COVID-19, but probably the least known. It reduces the risk of even being hospitalized by 70% to 85%, though it must be administered early to be effective – within four days of infection. Lives probably are being lost unnecessarily because people don’t know about it.

It’s monoclonal antibody treatment, abbreviated as mAb. To the extent the public has any familiarity with it they, may know it as Regeneron, though that’s actually the name of the company that makes the leading treatment, REGEN-COV2, and there are several other mAbs from other makers.

Health authorities for months back should have been issuing this message constantly: “Immediately after being exposed or you have COVID symptoms, get tested and ask if an antibody treatment is right for you.”

But they didn’t. They still aren’t. At least not in Illinois and most of the nation.

Why not?

No reasonable explanation is evident and a significant number of lives may have been lost because of the failure to inform the public properly. And now, with antibody treatments getting more attention, the treatments must be rationed, adding to the tragedy. At least in part, the explanation is a sad one – politics, and politicized media.

The effectiveness of REGEN and other antibody treatments has been known since at least November when the Food and Drug Administration granted emergency authorization for REGEN and another mAb. Earlier tests had found REGEN to be over 70% effective in heading off serious illness and multiple subsequent tests have confirmed it.

“Many of us were talking about this as early as March [2020]” wrote Scott Gottlieb, a former FDA commissioner.

“Regeneron did extraordinary work to secure their own manufacturing, but we needed a concerted industrial effort to get the supply we needed.”

Only over the last month have antibody treatments started to gain more attention. That’s probably because Dr. Anthony Fauci finally – belatedly – spoke up, saying that the treatments can reduce the risk of COVID-19 hospitalization or death by 70% to 85%. That seems to have been a signal to the establishment herd that it was permissible to talk about the treatments positively. The Biden Administration thereafter announced it would be stepping up purchases of the treatments.

But the increased attention has now caused a shortage of the treatments. What was in oversupply only a couple months ago is now being rationed. The Biden Administration just announced restrictions on how much of the treatments may be shipped to each state. From the Washington Post: “Soaring demand for the therapy represents a sharp turn from just two months ago, when monoclonal antibodies were widely available and awareness of them was low. With little promotion by the government, consumers, doctors and states were using just a tiny fraction of the available supply.”

Here in Illinois, health authorities and the media are completely behind the curve. It’s difficult to find even a word that has been said on the subject. The message isn’t being given that you should get tested fast if you think you are infected and see if antibody treatment is available to you.

Intensive care units in some parts of downstate Illinois are now full of COVID patients. How many of those hospitalizations would have been avoided if the victims had been aware of the treatment and acted quickly to get it?

That goes for most of the nation as well. Florida is one of six states among the exceptions. Those six states have been using the treatments aggressively, consuming 70% of the supply in recent weeks. That’s partly due to high, recent infection rates in most of those states, but also because they have seen the value of antibody treatment that other states have ignored, and they’ve told their people about it. That’s especially true of Florida, which I’ll get to.

Why haven’t health authorities and supposed experts been making a life-saving treatment better known?

One benign but irrational answer is that they don’t want to distract from the importance of vaccinations because they view prevention as better than treatment. For example, CNN’s expert, Dr. Leana Wen, said, “It’s totally backwards to say that we should be focused on treatment instead of emphasizing prevention, and the steps that we know work to stop Covid-19 in the first place.” And Dr. Christian Ramers, an infectious-disease specialist, told the Daily Beast. “It’s so much better to prevent a disease than to use an expensive, cumbersome and difficult-to-use therapy,” Ramers submitted. “It does not make any medical sense to lean into monoclonals to the detriment of vaccines. It’s like playing defense with no offense.”

That seems irrational on its face. Preventative vaccines and therapeutics like antibody treatment are not alternatives. Promote vaccines all you want, but when somebody is facing possible death, treat them.

But another explanation at least partially accounts for why mAbs have been shunned: The establishment doesn’t like the politics of who championed antibody therapy, particularly Florida Governor Ron DeSantis, a leading, likely, Republican candidate for president.

Since at least November, DeSantis has been encouraging Floridians to seek the treatment if they get infected.

“And the good thing about this is millions of doses are ready to ship as we speak,” he said then.

“Soon as the FDA approves they will then go out within the next 24 hours and we expect our hospitals hopefully to receive these within the next three to six weeks. He later set up clinics specifically for providing the treatment.

Well, we certainly can’t be agreeing with anything he says, as MSM sees things, so the Associated Press led the charge. They did it by trying to implicate two others the left doesn’t like, Ken Griffin and his hedge fund, Citadel. Griffin is a Chicago billionaire who frequently supports Republicans and conservative causes.

So, in a column reprinted almost universally in the national and Illinois media, the AP linked DeSantis’ support for antibody treatments to a Citadel investment in Regeneron and Griffin’s campaign contributions to DeSantis.

It was a smear job, creating the impression that Regeneron’s product is snake oil peddled by DeSantis as a return favor. DeSantis responded appropriately, saying the column was a blatant political attack.

The AP wasn’t alone. A Bloomberg columnist on Twitter mocked DeSantis and the Regeneron product because of what he claimed it costs – $1,250 per dose – though vaccines are free. That’s false. DeSantis made the treatment free.

As you would expect, the press had another reason for dismissing the value of antibody treatments – Trump. He credited Regeneron’s product for helping with his recovery when he was infected. But that was because Regeneron’s CEO was a member of Trump’s golf club, said the Daily Mail. And Trump owned shares of Regeneron and Gilead, another mAb maker, so that must explain his claim, as USA Today would have you believe. “No, Regeneron did not cure Donald Trump of COVID,” The New Republic flatly told us in a headline, as if they had any idea.

The facts on antibody treatment have now overrun that political hype. Still today, however, the public remains mostly unaware of the efficacy and availability of the treatment, except in a few states like Florida. Although treatments are now being rationed, they are available to people in high risk groups everywhere.

Too bad the federal government didn’t ramp up its purchases of the product earlier.

Too bad every state didn’t promote it as heavily as Florida did.

Too bad states like Illinois still aren’t talking about it.

Too bad governors in states like Illinois aren’t saying what DeSantis is now saying, which is that he will “fight like hell” to get what he can of the available treatments now being rationed.

Too bad because we will never know how many lives might have been saved.

Back in June, we explained that the reason behind the market’s shocking response to the Fed’s hawkish policy announcement when yields plunged instead of spiking higher, had little to do with what the Fed would actually do (as every Fed action is now in direct response to the market, which the FOMC is compelled to prop up no matter the cost) and everything to do with the market’s read of r-star, and we quoted DB’s head of FX strategy George Saravelos who said that everything that is going on “boils down to a very pessimistic market view on r*” or in other words, the same argument we made 6 years ago when we predicted – correctly – that the Fed’s hiking cycle would end in tears (as it did first in November 2018 when the Fed capitulated on its hiking strategy after stocks plunged, and then again in Sept 2019 when the Repo crisis forced the Fed to resume QE).

The bottom line, for those who missed our lengthy take on this complex topic is that the equilibrium growth rate in the US, or r* (or r-star), was far far lower than where most economists thought it was. In fact, as the sensitivity table below which we first constructed in 2015 showed, the equilibrium US growth rate was right around 0%. This means that each and every attempt by the Fed to tighten financial condition will end in disaster, the only question is how long it would take before this happens.

Today, we won’t recap the profound implications from Powell’s huge policy error which we laid out previously (we suggest readers familiarize themselves with our recent work on the topic published in “Powell Just Made A Huge Error: What The Market’s Shocking Response Means For The Fed’s Endgame“), but we will touch on a recent blog by Deutsche Bank’s Saravelos – who unlike most of his peers on Wal Street, has a clear and correct read on what is currently going on in the market – and to help clients comprehend what’s actually going on, he has penned a simple framework to understand current market behavior. As Saravelos puts it, “there is no “puzzle” in the way global bond markets are behaving and it is entirely possible for yields to fall as inflation pressures rise.”

As Saravelos explains, the starting point is that over the last six months the global economy has been experiencing a negative supply shock due to COVID. This can be most clearly seen in the incredibly sharp run-up in inflation surprises against the equally incredible sharp run-down in growth surprises.

In simple Econ 101 terms, we are  experiencing a leftward shift in the global economy’s supply curve. A negative supply shock (permanent or not) does two things: it lowers growth and increases inflation.

This is exactly what markets have been doing: inflation expectations are close to the year’s highs, but real rates (the closest market equivalent to a measure of real growth) are at the year’s lows.

The moves in the two variables are therefore entirely consistent with the incoming data.

Now what is most notable is that real yields have dropped more than inflation expectations have risen. The combined effect has been to lower nominal yields.

As Saravelos puts it, “there is nothing surprising about this, because there is nothing automatic about which effect dominates” and it ultimately depends on consumer sensitivity to rising prices, or in wonkish terms the slope of the demand curve: the greater the demand destruction from price rises, the bigger the negative effect on growth relative to inflation pushing yields down and vice versa. So, what the market is effectively doing, is pricing in substantial demand destruction from the supply shock.

Is this the correct thing to be pricing? Perhaps it is, we have been highlighting this unfolding demand destruction since May, and consumer confidence in the US is collapsing.

What about central bank reaction functions? There is an automatic belief in the market that higher inflation should mean more hawkish central banks. But as the DB strategist notes, “this belief rests on 30 years of demand shock management, where inflation has always and everywhere been positively correlated to growth.” And as an interesting aside, according to Saravelos, Larry Summers was right about inflation risks this year but wrong about the cause: lower supply has dominated over stronger demand. A supply shock similar to the one we are currently experiencing means the central bank response is not obvious, and as a result “raising rates will only make the growth shock worse.” By implication, tapering – which is tightening no matter what you read to the contrary – will similarly be a policy mistake and compound the economic slowdown, leading to an even more powerful easing reaction in the coming quarters.

Which brings us to central banks’ characterization of the current inflation shock as transitory; as DB explains, it is another way of saying that they currently prefer to accommodate rather than respond to the supply shock. In terms of capital markets, ss long as the Fed looks through the shock, risk appetite will likely stay resilient, the dollar weak and volatility low. However, the moment the Fed does respond, all bets are off.

Bottom line, current market pricing is fully in line with a supply side shock with very strong demand destruction effects. A low r*, as we have been arguing since 2015 and again since June, is likely to prevail post-COVID only flattens consumer demand curves further. Saravelos concludes that “he continues to believe that it is the behavior of the consumer, including the desired level of precautionary savings as well as the response to the unfolding supply shock that is the most important macro variable for the market this year and beyond.” As such, the latest UMich survey which showed that Americans are panicking over soaring inflation, and whose buying intentions have plunged to the lowest levels on record…

… is extremely alarming.

 

 

 

Authored by Paul Joseph Watson via Summit News,

Chairman of the Joint Chiefs of Staff, General Mark Milley, tried to downplay the 2020 Black Lives Matter riots in an effort to prevent Donald Trump from invoking the Insurrection Act, arguing that they were mainly centered around the use of “spray paint.”

That’s according to the new book, ‘Peril’, written by Bob Woodward and Robert Costa.

Despite the violent demonstrations quickly spreading across the country, Milley continued to insist that they had only impacted two cities and were relatively sedate, echoing CNN’s ludicrous “fiery, but most peaceful” description of the riots.

“They used spray paint, Mr President, that’s not an insurrection. […] We’re a country of 330 million people. You’ve got these penny packet protests,” Milley allegedly told Trump.

Milley apparently told Trump that most of the riots only involved around 300 people and that they paled in significance to the 1968 Washington riots caused by the assassination of MLK and the Battle of Fort Sumter in 1861, which started the Civil War.

The riots took mere days to spread to virtually every major city in the country, with looting, arson and violent attacks becoming commonplace, eventually causing around $2 billion dollars in property damage as well as at least 19 deaths and over 17,000 arrests.

At one point, demonstrators took over an entire area of downtown Seattle, completely obliterating official law and order for a number of weeks.

Trump’s failure to act strongly and decisively led to him looking weak, derailing a lot of momentum he would have had going into the election.

According to other reports, Trump wanted to invoke the Insurrection Act and put Milley in charge of National Guard troops to end the unrest, leading the two to have a shouting match where Milley refused to take charge.

Back in June, Milley appeared to side with the kind of ‘woke’ rhetoric spewed by far-left groups like BLM when he told the House Armed Services Committee that he was concerned about “white rage” in the United States.

As we highlighted earlier this week, Milley was also accused of treason by Trump after it emerged that he had promised to warn China ahead of any military operations.

Fox News host Tucker Carlson labeled the revelation, “One of the scariest things that has ever happened in this country.”

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So much for prior declarations heard among Western officials of a more “moderate” Taliban… On Friday Reuters has confirmed that what was formerly the “Ministry of Women’s Affairs” in Kabul has now been changed to “Promotion of Virtue and Prevention of Vice” – according to a new sign that’s gone up over the ministry.

The full lengthy name of what formerly under the US-backed national government served to protect women’s rights is now the “Ministries of Prayer and Guidance and the Promotion of Virtue and Prevention of Vice,” Reuters reports.

It appears to be the reestablishment of the ‘morality police’ that the Taliban had in place prior to the 2001 invasion, which was tasked with ensuring strict enforcement of sharia law in all aspects of public life, including that women wear the burka, no alcohol is possessed or consumed, and that there’s a strict segregation of the sexes with the exception of family. 

The virtue and vice arm of the ministry was also responsible for carrying out punishments ranging from public flogging to executions. 

Reuters further notes that women had been for weeks attempting to enter the Women’s Affairs ministry building but that they were consistently turned away. According to further details:

• The Taliban has said that women will not be allowed to work in government ministries alongside men.

• Though the group said women in Afghanistan can continue with their university studies, classes must now be segregated and head coverings are mandatory. The Taliban has ordered secondary school classes for boys to resume on Saturday, but made no mention of the future of girls’ education in the notice, according to The Guardian.

Ironically this reestablishment of what’s essentially the Islamic moral police comes days after on Monday a United Nations donor conference in Geneva resulted in $1.2 billion in aid being pledged to Taliban-controlled Afghanistan.

Absent so far has been aid from Washington, with the White House earlier saying this would be dependent on the Taliban’s behavior and actions. This hasn’t stopped Europe, however, form letting the aid flow – which the Taliban has promised to deliver to the people.

Authored by Jack Phillips via The Epoch Times,

A spokesperson for Florida Gov. Ron DeSantis’s office said that more than half of those who are seeking monoclonal antibody treatment in the south of Florida are “fully vaccinated” individuals amid supply issues.

“More than half the patients getting the monoclonal antibody treatment in south Florida are fully vaccinated,” DeSantis spokeswoman Christina Pushaw wrote in response to a comment on Twitter that suggested that only unvaccinated people are the reason why there is a significant demand for monoclonal antibodies.

Florida, she wrote hours earlier, “is above average in vaccination rate” and that “more than half of the patients in south Florida getting monoclonal antibody treatment are vaccinated and have breakthrough infections. Vaccinated or unvaccinated – Denying treatment to Covid patients is wrong.”

Monoclonal antibodies are engineered immune system proteins that boost an immune response against an infection.

Earlier this week, the White House and Department of Health and Human Services (HHS) announced plans to control the U.S. monoclonal antibody supply due to distribution issues. According to HHS’s website in a Sept. 13 update, the agency “will determine the weekly amount of mAb products each state and territory receives based on COVID-19 case burden and [monoclonal antibody treatment] utilization.”

A spokesperson for HHS told CNN that Florida, Texas, Mississippi, Tennessee, Alabama, Georgia, and Louisiana are using 70 percent of the supply of the drug.

“Given this reality, we must work to ensure our supply of these life-saving therapies remains available for all states and territories, not just some,” the HHS spokesperson said, adding that a new system “will help maintain equitable distribution, both geographically and temporally, across the country … providing states and territories with consistent, fairly-distributed supply over the coming weeks.”

Before the change, states and hospitals could purchase the antibodies on their own without going through the federal government.

“More than 50 percent of the monoclonal antibodies that had been used in Florida were going to be reduced,” DeSantis said on Thursday, adding that “there’s going to be a huge disruption, and patients are going to suffer as a result of this.”

On Thursday, DeSantis’s office said the state would deal directly with GlaxoSmithKline, a maker of monoclonal antibody infusion treatments.

“The Biden administration and their allies in media have claimed that Florida is using too much monoclonal treatment because of a low vaccination rate,” Pushaw told The Epoch Times on Thursday, “and Biden has lashed out at Governor DeSantis for opposing the tyrannical federal vaccine mandate.”