Tag: finance

Shares of California’s largest, insolvent utility, PG&E, plunged 26% to a new all time low on Friday…

… amid speculation that the company – which filed for bankruptcy at the start of the year as it was faced with soaring legal liabilities over its involvement in the most destructive California fire in history – would be held liable for the Kincade Fire which is burning in northern California, and has already affected 16,000 acres.

According to a note by Citi’s Praful Mehta, while it is still unclear if this week’s fire in Kincade was indeed caused by PG&E equipment, the prospect raises the risk of wiping out PG&E’s equity value, which would also undermine the recovery plan favored by PG&E and its shareholders, and make it more likely that a rival plan from bondholders will win approval, one which leaves the current equity a donut.

The Citi report comes one day after PG&E admitted that its transmission lines in the area of Kincade fire were not de-energized because forecast weather conditions, particularly wind speeds, did not trigger the Public Safety Power Shutoff protocol. In a statement, the company added that the wind speeds of concern for transmission lines are higher than those for distribution, adding that the transmission tower was inspected earlier this year as part of PG&E’s Wildfire Safety Inspection Program. Of course, none of that will matter if California finds that the Kincade fire was indeed the company’s fault.

Mehta echoed his bearish sentiment from earlier this month, when the analyst set a Street-low price target at $5 on PCG shares (they are trading at $5.30 after today’s drop), predicting there was a 75% probability the California power company’s stock would fall to zero. On Friday, he repeated his call, saying “shareholders are worried — and should be.”

Separately, Evercore ISI analyst Greg Gordon said that if the fire is linked to PG&E during the bankruptcy process, it would be whether the company met California Public Utilities Commission’s standards on whether the disaster was handled prudently. If the company were found to have acted imprudently in a $10 billion fire and were able to negotiate claims down to $6 billion, PG&E may still be on the hook for $4.3 billion, Gordon said.

“PCG has modest insurance and can access the state wildfire insurance fund (with limits), but this is a setback,” Gordon wrote. “A big fire could increase overall liabilities for shareholders and threaten the viability of their equity backstop.”

As Bloomberg notes, backers of the PG&E plan could terminate their financial commitment of over $14 billion if a destructive wildfire is linked to PG&E and its service territory before 2020. And with wildfires continuing to spread, participants wonder whether PG&E will be able to reach a bankruptcy settlement. Another bad fire season could push them into bankruptcy again.

Bloomberg Intelligence analyst Negisa Balluku said that a fire caused by PG&E equipment could also affect PG&E’s ability to abide by California’s wildfire liability law. Such a fire would “likely lead to claims with precedence over those from the 2017-18 California wildfires as well as over unsecured debt,” she said.

Meanwhile, in a double whammy for California, even as a part of the state is burning again, the worst may be yet to come for California residents, because whereas the bankrupt utility said it had restored power to about 165,000 customers in portions of 18 counties, or about 93% of those affected, the giant utility is preparing to cut the lights again across much of its territory this weekend in anticipation of the strongest wind storm in years, potentially leaving 1.2 million customers without power, which reminds us of something we joked a few days ago: “Every time the wind blows California will become Venezuela”.

PG&E: 1.2 MILLION POWER CUSTOMERS IN FIRE WEATHER WATCH AREA

Every time the wind blows California will become Venezuela

— zerohedge (@zerohedge) October 22, 2019

It turns out it wasn’t a joke.

George Soros, like Barack Obama, has passed over former Vice President Joe Biden when it comes to the 2020 US election.

In a wide-ranging interview with the New York Times, the progressive billionaire predicted that Senator Elizabeth Warren of Massachusetts will become the Democratic nominee who will face Trump in 2020.

“She has emerged as the clear-cut person to beat,” he said. “I don’t take a public stance, but I do believe that she is the most qualified to be president.“

Soros quickly added that his comments were not an endorsement of Warren, saying “I’m not endorsing anybody because I want to work with whoever, ” adding “I don’t express my views generally because I have to live with whoever the electorate chooses.”

When the Times’ Andrew Ross Sorkin pointed out that the ultra-wealthy, including his Wall St. peers think Warren’s taxation of the rich and tight regulatory plans for banks would be a giant threat to the “capitalistic system in which he made his riches,” Soros said he disagreed – reiterating his support of a wealth tax.

“I am in favor of taxing the rich,” said Soros, “including a wealth tax.”

Pausing for a moment, he looked like he was searching for the right words to explain himself.

“A financier makes people suspicious,” he said. “And it does create a moral problem for me. As I became so successful, it basically put a self-imposed constraint on me that actually interfered with making money.”

Still, Mr. Soros batted away the idea that he and his Wall Street brethren had the political power and influence that was often ascribed to them — or at least that they would have less power in this election cycle than in previous ones.

“There are more Main Streets in America than there are Wall Streets. So I don’t think that Wall Street, other than being a source of money, will have its way in choosing the president.” –New York Times

Read the rest of the interview, including Soros’s thoughts on Trump, China (“I consider Xi Jinping’s China the worst threat to an open society.”) and other topics here.

After a bloodbath of a week, Cryptos are suddenly soaring higher this morning.

The entire space is a sea of green…

Source: Coin360

Bitcoin is up over $1,000 today

Source: Bloomberg

Lifting all major altcoins into the green for the week…

Source: Bloomberg

Cointelegraph contributor Michaël van der Poppe had previously noted the 200-day moving average for Bitcoin (around $7,400) would form a likely support area. 

“These dips on $BTC are overall giving you a beautiful opportunity to buy until the market starts its next wave up,” he told Twitter followers on Thursday prior to the uptick. 

Source: Bloomberg

Resistance for Bitcoin still remains heavy closer to $8,500. Beyond technical circles, the mood suggests a catalyst is needed to overcome this. This week, investor Mike Novogratz told mainstream media that new custody solutions for institutional investors could be the clinching factor. 

“It’s going to need new energy to really make the big move,” he said in an interview with CNBC.

Finally, we note that this sudden surge comes as the hash-rate reaches record highs, suggesting miners remain bullish…

And Twitter/Square’s Jack Dorsey could not have been clearer: “We love you Bitcoin.”

 

Authored by Zev Chafets, op-ed via Bloomberg.com,

Russia will soon find itself caught between Turkey and Syria…

After U.S. President Donald Trump announced a withdrawal from Syria, the House of Representatives overwhelmingly passed a resolution denouncing it as “a benefit to adversaries of the United States government, including Syria, Iran and Russia.”

Six days later, Mitch McConnell, the Republican leader of the Senate, introduced a similar resolution. “If not arrested,” he said, “withdrawing from Syria will invite more of the chaos that breeds terrorism and create a vacuum our adversaries will certainly fill.”

Such bipartisan agreement is rare in Washington these days. But it underestimates the wisdom of Trump’s decision, the benefits for U.S. interests in the Middle East and the nasty trick he has played on Russian President Vladimir Putin.

Trump calls Syria a “bloody sandbox.” He’s right about that. It is also a briar patch of warring tribes and sects, inexplicable ancient animosities and irreconcilable differences.

The president is not prepared to take responsibility for this complicated place, or to get caught up in it. If leaving creates an opportunity for Russia to fill the vacuum, as American lawmakers believe, then it is one Trump is happy to cede. The Russian leader struts on the world stage, but he has not exactly won a victory.

Sooner or later, al-Qaeda, Islamic State or the next iteration of jihad will break loose in Syria. When that happens, the Russians will be the new Satan on the block. Their diplomats in Damascus will come under attack, as will Russian troops. More troops will be sent to defend them. Putin’s much-prized Mediterranean naval installations will require reinforcement. And so on. Soon enough, jihad will inflame Russia’s large Muslim population. Moscow itself will become a terrorist target.

The “safety zone” that Putin and Turkish President Recep Tayyip Erdogan have recently carved from northern Syria will collapse. Syrian leader Bashar al-Assad rightly considers it a violation of his country’s sovereignty, and if he can persuade his Russian patrons to shut down the zone, Erdogan will threaten another invasion. If Putin then sides with Turkey, Assad will take matters into his own hands. His army may not be fit for fighting armed opponents, but the Kurds are and can act as Assad’s proxies.

If and when such a border fight develops, Putin will find himself between Assad and Erdogan. Whatever he does, he will wind up in that most vulnerable of Middle Eastern positions, the friend of somebody’s enemy.

As the big power in charge, Russia also will be expected to help its Syrian client rebuild the damage from the civil war. Physical reconstruction alone is expected to cost $400-500 billion. This is a bill Trump had no intention of paying — and one more reason he was glad to hand northern Syria to Putin.

Russia cannot afford a project of this magnitude. It’s possible that Putin expects EU countries to foot the bill — motivated either by humanitarian impulses or by the desire to forestall another wave of destitute immigrants. But this is wishful thinking. Faced with a potential influx of Syrian refugees, Europe is more likely to raise barriers on its southern and eastern borders than to invest in affordable housing in the ruins of Aleppo and Homs.

What’s more, Syria needs more than new housing. It needs an entire economy. Tourism, once a major industry, has vanished. The country’s relatively insignificant oilfields are inoperable or in the hands of the tiny contingent of U.S. troops that’s left to guard them. And the country’s biggest export product is spice seeds.

Another headache for Putin is the ongoing Israel-Iran war, which is being fought largely in Syrian territory. So far, Russia has been studiously neutral. The powerful Israel Defense Forces are engaged against what their leaders regard as a strategic threat. And, unlike the Kurds, Israel is not a disposable American ally. Putin knows this and will not risk a military confrontation no matter how many Syrian-based Iranian munitions warehouses Israel destroys or how hard Assad pushes him to retaliate.

Critics who see the U.S. withdrawal as an act of weakness that will hurt American prestige and influence in the Middle East are wrong. The Arab world understands realpolitik and will read Trump’s indifference to the fate of Syria as the self-serving behavior of the strong horse.

For that is what the U.S. is. It has far more naval power, air dominance, strategic weaponry and intelligence assets than any other country in the region, including Russia. And its allies are the richest, best situated and most militarily potent countries in the Middle East. Not one of them will trade its relationship with Washington for an alliance with Moscow, and Trump knows this. As far as he’s concerned, Putin is welcome to the sandbox and the briar patch.

Take a close look at the following two slides which have been a staple presence in every SoftBank presentation in recent quarters.

Actually, add these two charts to the mix:

We somehow doubt we will see any, if not all of these charts, in any future Softbank presentation.

Why? Because, in a brutal wake up call for Japan’s SoftBank, which for years has drifted happily in the miasma of central bank liquidity-induced delusion with just the right dose of “humility” seeing itself as the “conductor of the AI revolution“…

… and with just the right dose of insanity projecting its market cap to do this in 20 years…

… Bloomberg reports that the bank/telecom/venture investor/whatever is planning to take a writedown to its Vision Fund of at least $5 billion to reflect a plunge in the value of some of its biggest holdings, including WeWork and Uber Technologies.

According to Bloomberg sources, the Japanese parent of the $100 billion Vision Fund is set to unveil the writedown when SoftBank announces second-quarter earnings on Nov. 6, mostly due to the Vision Fund’s holdings in ride-hailing giant Uber and WeWork (we would say “We” but we probably have to pay Adam Neumann royalties for using that word), the devastated office sublettor which just lost $40 billion in value in a few weeks, that SoftBank had no choice but rescue earlier this week, and double down on its investment or else risk a total wipeout of its $9 billion or so existing investment.

As Bloomberg notes, whereas both Uber and WeWork were once “among the brightest stars in the SoftBank constellation”, prominently displayed in every company presentation, they are now among its worst performers.

And, as we have snarked in the past…

When is the BOJ’s bailout of Softbank?

— zerohedge (@zerohedge) September 5, 2019

… the collapse in valuations of these unicorns have not only prompted rhetorical questions whether the BOJ will be called in to bailout SoftBank in the not too distant future, but also prompted questions about billionaire Masayoshi Son’s investment acumen (does he actually do any analysis on his investments) and credibility at a time he’s trying to raise an even larger successor to his original mega fund, the Vision Fund 2…

… which SoftBank hopes will be even bigger than the first Vision Fund, which us in large part backed by SoftBank, Saudi Arabia’s Public Investment Fund and Abu Dhabi’s Mubadala Investment, and which has made 83 investments by June 30, according to an August disclosure. Maybe not: in fact, after the implosion of WeWork some of the most morbid jokes on Wall Street include Masa Son, a visit to a Saudi embassy and Jamal Khashoggi’s bonesaw all in the same sentence.

In any case, as Bloomberg notes, “the tepid performance of ride-hailing stocks in particular has influenced the way SoftBank is thinking about valuing its investments in the sector” noting that public markets – unlike the massive billionaire circle jerk that are “private markets” – have “not been kind to either Lyft or Uber, which has tumbled more than 25% since its May initial public offering.”

As a result, the Vision Fund is reassessing its recorded valuations of other ride-hailing companies, such as Didi and Grab Holdings: according to Bloomberg data, between June 30 and Sept. 30, the value of SoftBank’s 13% stake in Uber decreased by about $3.5 billion.

What is bizarre is that if the math is correct, the upcoming $5 billion writedown then implies a loss of only $1.5 billion in SoftBank’s WeWork investment when considering its current valuation of just under $8 billion and the latest bailout package from Softbank of roughly the same size, Masa Son’s updated mark on its existing WeWork investment should be orders of magnitude greater, if not the entire thing.

That’s probably why Bloomberg also adds that the writedown could be “as high as $7 billion”, as the amount has not yet been finalized and could still change. That surpasses some market projections: Mizuho Securities analyst Yusuke Hori has estimated declines in portfolio companies could force SoftBank to book as much as a 500 billion yen ($4.6 billion) valuation loss.

Yet the fact that even now SoftBank – which was left on the verge of bankruptcy when the dot com bubble burst – is unwilling to pull off the band aid and to admit it has made many mistakes in its pursuit of its target of a 200 trillion yen market cap, should be a major alarm to everyone in the financial world.

Meanwhile, as the WSJ journal reports this morning, after suffering billions of dollars of losses on its investment in WeWork, the Vision Fund “is scaling back its high-risk investing strategy and focusing more on improving corporate governance at portfolio companies, according to current and former executives at the fund.”

Masayoshi Son, SoftBank’s chairman and CEO who also runs the Vision Fund, has told staffers at the fund to push the companies in which it owns stakes to generate cash, these people said, a drastic shift from his earlier demands that they spend aggressively to drive sales growth. Vision Fund executives are scrutinizing some deals more closely, such as one for a company that designs robots to cook hamburgers.

With investors suddenly balking at “growth” narratives and ridiculous mission statements (such as “elevating the world’s consciousness”) and focusing on profits, SoftBank finds itself in a corner, and following three years of rapid, tumultuous growth at any cost, the fund is also focusing on improving corporate governance at portfolio companies and possibly looking to reduce staff by asking some weaker employees to leave.

And just as WeWork is now engaging in mass layoffs, SoftBank itself could be next, with the WSJ noting that in recent weeks, “leaders of the fund’s investment teams have been asked to make lists of their weaker employees, possibly a prelude to small staff cuts” with both moves a first for the fund. Meanwhile, sensing what’s coming, roughly a dozen investment staff have left on their own since the spring of this year, “many unhappy about what they see as a toxic culture with competing teams, inexperienced investment executives, and poor communication, as well as a risky incentive structure that, for some, made it less appealing to be at the fund, people familiar with the structure said.”

In short, SoftBank’s bubble has finally burst, and what comes next could be nothing short of disaster.

But it’s not just SoftBank that faces a grim future: the size of SoftBank’s investments was large enough to dramatically affect the way the Silicon Valley startup ecosystem operates, as Bloomberg notes. The Vision Fund – whose massive portfolio spans numerous industries but has been dominated by transportation and logistics bets, with $28.3 billion of its total investments dedicated to this sector as of June 30 – reported that it had made cumulative investments of $71.4 billion, and had combined unrealized and realized gains from investments and related hedges of $20.2 billion; a year-on-year jump from $30.9 billion in investments and $5.2 billion in cumulative gains.

“Eventually this is going to come back to haunt them,” said Asymmetric Advisors’ strategist Amir Anvarzadeh said. The question is when.

For now, SoftBank’s shares slid 2.7% to their lowest since January (when SoftBank announced it would repurchase over 10% of its stock, sending it soaring to all time high), putting the stock on track for a fourth straight day of losses.

The real question, however, is whether not WeWork, but SoftBank will turn out to be the most levered poster child for the liquidity excesses of the current asset bubble, and by extension, whether SoftBank will be the short of the century. While the answer will ultimately depend on what central bankers do over the next few years, here is our contribution (in red) to one of SoftBank’s most egregious examples of hubris taken straight from its latest investor presentation.

Authored by Yves Smith via NakedCapitalism.com,

The Pentagon has long been concerned about the threats climate change pose to stability and how it will lead to conflicts due to mass migration and even more intense competition for scarce resources. In the early 2000s, the military warned that climate change could induce large-scale deaths and migrations out of low-lying areas such as Bangladesh due to storms and flooding.

A recent look at the dangers climate change poses to US military operations, released over the summer by the Army War College, went virtually unnoticed despite offering “Apocalypse Near” scenarios a mere 20 years out.  And it isn’t  just that very bad things are in the offing; the report finds that “the Department of Defense (DoD) is precariously unprepared for the national security implications of climate change-induced global security challenges.”

We found out about this document only as a result of an article in Vice flagged by resilc. We’ve embedded the document at the end of the post and strongly urge you to read it in full. Or if you want Cliff Notes versions, see The Center for Climate and Security or the Vice piece

The report sees the lack of potable water as a serious limitation on US military operations, which it anticipates will be overtaxed due to destabilizing climate-change induced mass migrations abroad, combined with domestic Jackpot-level threats of an overtaxed, decrepit electrical grid; diseases; and drought and potential crop failures. Vice gives a good high-level recap:

The report paints a frightening portrait of a country falling apart over the next 20 years due to the impacts of climate change on “natural systems such as oceans, lakes, rivers, ground water, reefs, and forests.”

Current infrastructure in the US, the report says, is woefully underprepared: “Most of the critical infrastructures identified by the Department of Homeland Security are not built to withstand these altered conditions.”

Some 80 percent of US agricultural exports and 78 percent of imports are water-borne. This means that episodes of flooding due to climate change could leave lasting damage to shipping infrastructure, posing “a major threat to US lives and communities, the US economy and global food security,” the report notes.

Notice that its timing is very similar to what we’ve repeatedly said: that potable water is the world’s most scarce natural resource, and it will come under stress by 2050 (we’re seeing it sooner in places like Cape Town). And even though water is theoretically recyclable and non-potable water can be made into potable water, that comes at an energy cost as well as other environmental damage (for instance, the not-trivial problem of salt disposal with desalination).
.
What is striking is the language and scenarios are at Defcon2 levels. The document stresses it has no ideological point of view about climate change and based its forecasts on what it depicted as mainstream work. And it pointed out that climate change is already happening.

The first major threat it identifies is mass migration. Here is the second, which is less well recognized, from the executive summary:

Salt water intrusion into coastal areas and changing weather patterns will also compromise or eliminate fresh water supplies in many parts of the world. Additionally, warmer weather increases hydration requirements. This means that in expeditionary warfare, the Army will need to supply itself with more water. This signifcant logistical burden will be exacerbated on a future battle eld that requires constant movement due to the ubiquity of adversarial sensors and their deep strike capabilities.

This is quite the admission:

The U.S. Army is precipitously close to mission failure concerning hydration of the force in a contested arid environment. The experience and best practices of the last 17 years of con ict in Afghanistan, Iraq, Syria, and Africa rely heavily on logistics force structures to sup- port the war ghter with water mostly procured through contracted means of bottled water, local wells and Re- verse Osmosis Water Puri cation Units (ROWPU). The Army must reinvest aggressively in technologies both in-house and commercial off the shelf in the next 5-10 years to keep pace with rising global temperatures, es- pecially those arid areas in or poised for con ict. The Army must seek partnerships with industry, other na- tions, and other militaries currently working on the hy- dration issue.

While the report does not tease out all the implications, salt water intrusion will be another driver of mass migrations, not only due to its impact on potable water but also on fishing and farming. And of course, that plus sea level rises and more frequent storms will also threaten and even cripple existing US installations, although that risk isn’t immediate.

Of course, there’s no mention of how the US military is a big greenhouse gas emitter; the article blandly notes, “The DoD does not currently possess an environmentally conscious mindset.” To its credit, the report does make changing that a top priority for the Army. It takes a “get on the bus or you’ll be under the bus” perspective:

As the electorate becomes more concerned about climate change, it follows that elected of cials will, as well. This may result in significant restrictions on military activities (in peace- time) that produce carbon emissions.

On the mass migration front, the report suggests planning for a Bangladesh-level disaster, and point out that drought was a major impetus for the conflict in Syria, with refugees from Iraq increasing pressure, which resulted in the exodus of 5 million Syrians out of a pre-war population of 22 million. Bangladesh has over eight times as many people and sits in a conflict-prone area with nuclear powers on either side.

But the report also foresees that the military could be overwhelmed by domestic demands, particularly due to our crap infrastructure, namely that the aging electrical grid will face higher demands as wider-ranging temperatures = more power use. The fact that this report is considering “collapse” as a possibility is telling:

Effects of climate abnormalities over time introduce the possibility of taxing an already fragile system through increased energy requirements triggered by extended periods of heat, drought, cold, etc. If the power grid in- frastructure were to collapse, the United States would experience significant

• Loss of perishable foods and medications

• Loss of water and wastewater distribution systems

• Loss of heating/air conditioning and electrical lighting systems

• Loss of computer, telephone, and communica-tions systems (including airline ights, satellitenetworks and GPS services)

• Loss of public transportation systems

• Loss of fuel distribution systems and fuel pipelines

• Loss of all electrical systems that do not have back-up power

The caliber of the US response to power failure in Puerto Rico should give pause to the idea that the military is able do much to help.

A rise in insect-borne disease is another potential demand overseas and even here. While the report contends the US military has capabilities that enable them to help, I’m skeptical. And if a highly infectious disease emerges and spreads, it’s hard to imagine that any place in the world has the social cohesion and the public health system to respond well. The Steven Soderbergh movie Contagion was the feel-good version of what would happen if a virulent pathogen got loose. It’s hard to think that people in America would accept a quarantine or line up politely to collect food rations.

There is also considerable discussion of the threats and opportunities posed by the de-icing of the Arctic.

Finally, please do read the report before coming to conclusions about what it means for the possibility of operations in the US. The analysis by implication sees the military as asked to help in the event of a sustained domestic disaster, like a large scale electrical grid failure or a disease outbreak. It does not contemplate domestic violence. However, it’s not hard to see the possibility of martial law if the trajectory is as dire as this analysis suggests.

Having surged last Friday (and everyday since) on the back of an apparent trade deal, phase one, being completed-ish, headlines that the US and China are near completion of some aspects of the phase one trade deal that was supposedly all but papered last week has sparked yet more gains for stocks…

Fox News’ Edward Laurence tweeted:

“I have learned the phone call between the heads of the 2 trade teams has concluded. US Trade Rep Lighthizer & Treasury Sec Mnuchin spoke to Vice Premier Liu He to finalize the Phase One deal with China. US Sources say the teams are close to finalizing some sections..”

So are we closer-er to a deal that we were last Friday?

S&P is getting very close its record closing high of 3025.86 (3027.98 intra)

It’s deja vu all over again…

And all on the heels of yet another short squeeze…

Source: Bloomberg

 

It is becoming a full on, four-alarm redemption stampede at Ken Fisher’s firm, Fisher Investments.

Both the city of Los Angeles and Goldman Sachs have now joined the ranks of Fidelity, the Michigan Retirement Fund, the Iowa Public Employees Retirement System, the New Hampshire Retirement System and the Philadelphia Board of Pensions in pulling their money out of Fisher’s firm, according to Bloomberg.

The LA pension board called a special meeting on Thursday to discuss their contract with Fisher and L.A. pension commissioner Brian Pendleton said: “Fisher’s words reach millions and only do damage. Other pension funds are going to come to the same conclusion and we shouldn’t be the last ones to turn the lights off.”

Fisher Investments CEO Damian Ornani apologized to the LA pension board, stating: “I really apologize sincerely. He does too. He understands what he did. This will not happen again. This is not who Fisher Investments is. This is not who Ken Fisher is.”

The irony, of course, is that Fisher is hardly alone: in fact, the more an investor protests, the more likely they have one or more men who say the same, if not worse, as Fisher. And yet, with the magic of virtue signaling, if one pulls their money it is somehow seen – internally at least – as redemption for their sins.

Hypocrisy aside, LA commissioner Kenneth Buzzell responded: “Talk is cheap. I’d like to find out what if anything you’re going to do to attempt to right as best you can what’s been done” while board president Adam Nathanson took exception with the fact that Fisher himself didn’t attend the meeting. He stated: “It’s telling that he’s not here. He’s the one who said the comments. The accountability lies with Mr. Fisher.”

When they were told Fisher was too important to the firm to resign, and that the firm was a “great place to work”, L.A. commissioners responded by “saying they have heard that Fisher’s comments are part of a pattern of inappropriate behavior and no one at the firm can hold the founder accountable for his actions.”

Meanwhile, arguably the biggest abuser of chauvinistic harsh language – anyone who has been in the middle of the Goldman trading floor during the mid/late 2000s knows precisely what we mean – Goldman Sachs, is now pulling out $234 billion from Fisher, according to CNBC. One source commented that the final sum withdrawn from Fisher Investments could wind up being “even greater”. 

About 3 days ago, we reported that Fidelity had pulled $500 million from Fisher’s firm. Days prior to that, we reported that Iowa had pulled out $386 million from the firm. This was only hours after we reported that the city of Boston had also pulled out of Fisher Investments to the tune of $248 million.

Shawna Lode, spokeswoman for the IPERS, had said: “IPERS staff has taken time to evaluate this situation, and it is our opinion that Mr. Fisher’s comments have damaged the credibility of the firm and its leadership. As a result, the risk to IPERS is that the firm could lose investment talent, and/or it may be unable to recruit high caliber talent in the future.”

“Furthermore, the negative publicity will probably continue to be a major distraction to Fisher Investment personnel,” she correctly prognosticated.

Several weeks prior, Lode had commented that the IPERS was reviewing their relationship with Fisher Investments: “Fisher’s remarks are obviously concerning,” she said at the time. “Although our investment management contracts do not include a conduct policy, we hold our partners to the highest standards and reserve the right to amend or sever any contract at our discretion.”

Recall, just days after the $70 billion state of Michigan retirement fund pulled its assets from Fisher Investments, the city of Boston also did the same.

Fisher managed $600 million in retirement funds for Michigan and the state’s exit ends a 15 year relationship with Fisher’s firm.

Boston Mayor Martin Walsh said at the time: “Boston will not invest in companies led by people who treat women like commodities. Reports of Ken Fisher’s comments and poor judgment are incredibly disturbing.”

Michigan’s chief investment officer, Jon Braeutigam, notified the state investment board of the termination on October 10. In his letter, he said that Fisher’s comments were “unacceptable” and that although employees at his fund hadn’t witnessed similar comments, “history does not outweigh the inappropriateness of the comments.” 

Fisher was managing about $10.9 billion on behalf of 36 state or municipal government entities at the end of 2018, down from $13.2 billion at the end of 2017. That number will likely be sizeably lower at the end of 2019. 

For those confused what caused all of this, recall that three weeks ago we reported that at a conference in San Francisco, Fisher – whose firm manages more than $100 billion – “shocked” attendees when he compared gaining a client’s trust to “trying to get into a girl’s pants.” Fisher also said at the same conference that executives who were “not comfortable talking about genitalia should not be in the financial industry.” 

Authored by Sarah Cowgill via LibertyNation.com,

What a week it was for the folks in flyover states. The first hard frost banished those annoying little insects back to the Hell from whence they came, fall foliage erupted in a burst of reds, umber, and orange, and the harvesting of crops was finally underway. But mouths fell agape as one Texas dad went to court in an attempt to keep his ex-wife from transitioning their seven-year-old boy into a girl, jeers at hints that Hillary may be attempting a comeback, and cheers as the Republicans seemingly – finally – grew a pair and stormed a secret squirrel Democratic Caucus meeting.

Adam Schiff

If nothing else was accomplished, the look of astonishment on the sour face of Rep. Adam Schiff (D-CA) raised spirits of an impeachment-exhausted nation.  Just this past week, 184 Republicans backed a bill to censure Mr. Schiff for his handling, or mishandling, of the impeachment investigative requirement. But frustrations reached a fevered pitch, and Republicans stormed a closed hearing room to demand answers.

Rep. Michael Waltz (R-FL) rallied the beleaguered electorate through remarks on Twitter: “I have fought from #Afghanistan to West Africa – I have operated in countries in third world countries who have fairer processes to deal with their elected leadership than what we see today.”

Of course, the Democrats warbled and whined, but it was all for naught as the once Silent Majority applauded the efforts of 24 Republican representatives. As Idaho Falls voter Steve Preuss stated, “Well, there are now 24 republicans I would vote for in 2020. I’m not very interested in those who are sitting on their hands.”

And most heartlanders agreed: It was a good start that needed to gain momentum.

In Traverse City, MI, Kay Doty celebrated the uprising:

“We the people want action. I’m glad some members of Congress have the guts to call these people out,” while down the road a pace in Shelby Township, Bob Bucci went a bit further: “I say we storm the polls come election day. Not only just for Donald Trump but to vote these crooked Democrats out. We owe that much to Donald Trump after all he’s done for us. PS … no RINOs.”

Cheryl Wuelfing in Tennessee took aim at the lame stream press, “What has happened to our press??!! When did it become ok to support and help communism tactics??!!! I hope to God President Trump’s fight rubs off on the Republicans.”

Yet it was John Baldasarre’s words that had commenters signing up to assist: “They should have gave Pencil neck a wedgie while they were at it!”

This Is Out Of Hand

An event in Texas has the Lone Star voters and the rest of the common-sense thinking electorate foaming at the mouth to lock up a pediatrician for child abuse. Dr. Anne Georgulas, a mother of twin seven-year-old boys, apparently wants a little girl and has petitioned the court to allow a chemically medical transition on one twin, which would include puberty blockers and cross-sex hormones. One thoughtful Oklahoman asked, “If he doesn’t go through puberty how does he even know he wants to be a girl?”

“James” or as the mother refers to him, “Luna.”

A good question, though a lot of folks went a bit radical on answers. No one was for allowing the mother the right to practice medicine on any other child, and many were all for removing the twins from her custody.

In Texarkana, Jimmy James was shaken.

“So sick. Shouldn’t be allowed to do this. It’s a decision that this kid when an adult should make.  The mother is insane !!!”

Tinna Alongi wasn’t very kind in her assessment of the situation:

“Hard to fathom a jury sided with the mother, allowing her sole medical rights.  Also hard to fathom this bats**t crazy mother is a pediatrician.”

She’s Back – Ugg

Also during the roller coaster ride through the Middle America came the drumbeat emanating from the Swamp that Hillary Clinton was prepping to run – and win – in 2020 against President Donald Trump.  Becky Ronstadt in North Dakota simply asked, “Hillary who?”  While others repeated a single word: “Benghazi.”

But along with the horror from many at the thought of Hillary running again, some welcomed a second, perhaps even more humiliating jaunt through the history books for the Clinton Clan matriarch.  Or as Mike Culver, said: “That’s Hillaryous.”

Attorneys John Bolton, President Trump’s former National Security Adviser, are in discussions with House committees about the possibility of giving a deposition in their impeachment investigations, according to journalist Shimon Prokupecz.

!!! John Bolton’s lawyers have consulted with the impeachment inquiry committees about a possible deposition. @kylieatwood

— Shimon Prokupecz (@ShimonPro) October 25, 2019

Bolton, who some speculated was the original “first-hand” source of the whistleblower complaint which launched the impeachment inquiries, was fired after President Trump says he “disagreed strongly with many of his suggestions.”

According to sources, while Trump had been growing displeased with Bolton’s belligerent recommendations and overall demeanor (recall “Bolton ‘Deep in His Heart’ Believes Trump Is a ‘Moron,’ Former Aide Claims“), the tipping point happened when Bolton expressed his displeasure with Trump’s impromptu invitation of the Taliban to Camp David on the week of the Sept 11 anniversary, a peace overture which as we reported over the weekend, collapsed in the last moment.

Developing…