SCOTUS Confronts ‘Mad Prosecutor’ in Illegal Fish Case

Under the Sarbanes-Oxley Act of 2002, it is a federal crime
carrying a penalty of up to 20 years in prison to alter, destroy,
falsify, mutilate, cover-up, or conceal “any record, document, or
tangible object with the intent to impede, obstruct, or influence
the investigation or proper administration of any matter within the
jurisdiction of any department or agency of the United States.”
More commonly known as the anti-shredding provision, this law was
enacted in the aftermath of Enron financial scandal. In effect, it
criminalizes the willful destruction or falsification of financial
records that might prove useful to the government in a current or
future prosecution.

Yet in 2010 a Florida commercial fisherman named John Yates was
convicted under this federal law because he ordered his crew to
throw 72 under-sized red groupers back into the water after a
federally deputized inspector found those fish to be illegally
undersized (at the time, red groupers had to be at least 20 inches
long to be legally fished). Yates was sentenced to 30 days in
prison for his actions. In 2013 the U.S. Court of Appeals for the
11th Circuit upheld
Yates’ conviction under the Sarbanes-Oxley Act, holding that
because a fish is a “tangible object,” Yates broke the law by
“knowingly disposing of undersized fish in order to prevent the
government from taking lawful custody and control of them.”

At
oral argument today
, the U.S. Supreme Court was asked to
consider whether this prosecution was a valid use of federal power
or a case of prosecutorial overreach. Judging by the justices’
questioning, the fishy prosecution may well end up floating in the
chum bucket.

“Is
there any other provision of Federal law that has a less penalty
than 20 years that could have been applied to this—this captain
throwing a fish overboard?” Justice Antonin Scalia asked Roman
Martinez, assistant to the solicitor general. “What kind of a mad
prosecutor would try to send this guy up for 20 years or risk
sending him up for 20 years?”

Justice Ruth Bader Ginsburg followed up with a similar critique.
“Is there any guidance that comes from [the Justice Department] to
prosecutors?” she asked Martinez.

“You make [Yates] sound like a mob boss or something,” observed
Chief Justice John Roberts, prompting laughter in the courtroom. “I
mean, he was caught” throwing fish back into the water.

“You are really asking the Court to swallow something that is
pretty hard to swallow,” concurred Justice Samuel Alito. “Do you
deny that this statute, as you read it,” he said to Martinez, “is
capable of being applied to really trivial matters, and yet each of
those would carry a potential penalty of 20 years, and then you go
further and say that this has to be applied in every one of those
crazy little cases.”

But Martinez refused to second guess the actions of the federal
prosecution. “The prosecution was about the destruction of the
evidence,” he declared, “and I think it would be a very strange
thing if this Court were to say that the obstruction of justice law
is somehow applied differently when the offense is trivial.”

A ruling in Yates v. United States is expected by June
2015.

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Tiny Teetotaling Tyrannies Topple. Or Not.

Marijuana prohibition is
on its way out
, and so is alcohol prohibition. Still. The 21st
amendment, which took effect in December 1933, repealed the
national ban on “intoxicating liquors,” leaving their regulation to
the states. Eighty-one years later, parts of America remain
alcohol-free zones, as reflected in yesterday’s elections.

Arkansas voters rejected
a constitutional amendment that would have done away with “wet” and
“dry” counties, making the sale of alcoholic beverages legal
throughout the state. The measure was supported by just 43 percent
of voters. The Associated Press
reports
that “opponents vastly outspent supporters in the
campaign, with much of the money coming from liquor stores in wet
counties.” Liquor stores were also part of the coalition against
the 2010 ballot
initiative
that made the entire city of Dallas wet, one of my
happiest experiences with democracy.

In Alabama, another state that lets local governments ban
alcohol sales, the residents of Hartselle, which a local TV station
calls “Alabama’s driest city,” decided to
stay that way, although 48 percent of voters wanted to go wet. On
the brighter side, Connecticut is all wet now that residents of the
last dry town, Bridgewater, have decided to
tolerate the booze trade, and so is Smith County, Texas, now that
Justice of the Peace Precinct 5, which includes the towns of
Lindale, Hideaway, Mount Sylvan, Garden Valley, and Swan, has voted
to repeal prohibition. From my experience in Dallas, I gather that
justice of the peace precincts in Texas are anachronistic
subdivisions with only one remaining purpose: making you drive
further than you’d like to buy a six-pack.

In South Carolina, which until 2005
forced
bars and restaurants to serve liquor out of teeny-tiny
bottles for no rational reason that anyone could ever explain, two
cities (Clemson and Pendleton) and two counties (Spartanburg and
Oconee)
voted
to allow alcohol sales on Sunday. Majorities also backed
Sunday sales in
Kaufman, Texas
;
Adairsville, Georgia
;
Centerville, Ohio
; and various
other places
. Minneapolis voters
abolished
a rule mandating that restaurants derive no more than
30 percent of their revenue from beer and wine sales.

Voters in Ranlo, North Carolina, delivered a mixed
verdict, allowing local stores and restaurants to sell
cocktails but not beer or wine. The Gaston
Gazette
 notes
that “only 909 people voted on the malt beverage and unfortified
wine measures,” while “917 people voted on the mixed beverage
question.” Cocktails won by three votes.

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Dysphoric Electorate Sends Stocks To Record Highs

Well it's the day after Midterms so stocks had to rally, right? It appears no one told Nasdaq stocks to toe-the-line. The Dow led the day (led by Visa again, 40 of 85pts); Trannies appeared to enjoy higher oil prices today and while the hunt for a catalyst remains absent, 1315ET marked a schizophrenic divergence in stock-buying exuberance that Nasdaq never recovered from. A very choppy day in stocks – macro data, Saudi headlines, McConnell and Obama. Gold (worst day in 4 months to Apr 2010) and silver (worst day in 13 months to Feb 2010) were crushed overnight (amid zero liquidity). Oil prices surged on Saudi ISIS fears (best day in 2 months) breaking above $79. Treasury yields rose modestly (but rallied into the close). The USDollar rallied in the EU session then flatlined in the US session. HY credit was not buying the equity exuberance as HGY closed red.

It is kind of ironic that the day after the country shows its distaste for the inequality inthis country (i.e. the 'positive' data not trickling down to the average joe) – US equities hit an all-time high and close near highs.

It appears algos were utterly confused today and stocks drifte higher on JPY and oil and nothing else.

Late-day buying panic dragged Small caps into the green but Nasdaq stayed red… just

 

Not exactly a great bullish day – Utilities surge and Energy stocks jump on Oil which jumped on terrorism concerns

 

Quite a divergence in commodity land as bullion was battered (gold worst in 4 months, silver worst in 13 months) and crude surged on Saudi pipeline explosion concerns…

 

and quite a divergence in credit and equities

 

Treasuries remain mixed on the week with modest rise in yields today – once again with volatility between 8ET and EU close

 

The Dollar rallied in the European session but stopped around 8ET (when bonds twanged)

 

and the Dollar strength sent gold ansd silver lower… and despite news of The Mint sold out of physical silver coins, silver tumbled into the close

 

 

 

Charts: Bloomberg




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Shikha Dalmia on Whether Obama Should Pursue Executive Action On Immigration

ImmigrationRallyThere is no doubt about it: The rout of the
Democratic Party this week has taken the wind out of any impending
executive action on immigration that President Obama might have had
in mind. He got his ass handed to him by voters and it would seem
like insanity to ignore their verdict and unilaterally push
something this controversial.

Even Vox’s Ezra Klein, no foe of immigration reform, openly
ridiculed White House Press Secretary Josh Earnest’s reassurance
that President Obama would go forward with his executive action,
sort of urging him to give it up.

But that would be political suicide for the Democratic Party in
2016, notes Reason Foundation Senior Analyst Shikha Dalmia.

View this article.

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The GOP’s Massive Win Doesn’t Solve Its Identity Crisis at All

The three of them do agree that they enjoy being powerful.The Republican Party’s victory
last night is certainly not to be dismissed or downplayed. The
latest
results
have them picking up seven Senate seats and losing
none, and picking up 15 House seats and losing only one (there’s
still some undecided races, though).

But this wave was not a result of a unified public movement.
That’s not to say it wasn’t organized or that the Republican
machine didn’t work hard for these outcomes. But it lacked a
“Contract with America” or populist Tea Party movement to indicate
to voters what they should expect once they “threw the bums out.”
Instead it ended up being an election about
rejecting President Barack Obama
. It wasn’t an election about
advancing any particular Republican position, and that has
reinforced the narrative of the
“election about nothing.”

Forget saying the Republican Party doesn’t have a “mandate” (an
oft-misused word) with its win, it doesn’t even really have
marching orders other than to not be Obama. It shouldn’t come as a
surprise then that the news out of the beltway today is that Sen.
Mitch McConnell (R-Ky.) and House Speaker John Boehner (R-Ohio) are
not acting like they’ve been put in charge of a revolution. From

The Washington Post
:

The remedy, they have decided: Act quickly to send President
Obama bills with bipartisan support to fast-track international
trade agreements, repeal an unpopular tax on medical devices and
approve the Keystone XL pipeline.

While Republicans will also stage more votes to repeal Obama’s
Affordable Care Act, party leaders readily acknowledge that they do
not have the votes to overcome a presidential veto — making an
all-out assault on the ACA a quixotic campaign, useful primarily as
a rallying point for the party’s base.

Note further on in the story:

When lawmakers return to Washington next week for a lame-duck
sessions, the two leaders are also planning a series of joint
appearances, joint memos and op-ed articles to signal their
decision to work together and to discourage more
intra-party drama.

Sen. John Thune (R-S.D.), chairman of the GOP conference, said
House Republicans and Senate Republicans have been quietly building
their relationships for months over dinners and meetings.

“Our fortunes are tied,” he said in an interview Wednesday.
“We’ve got to hang together and that approach starts at the top
with Mitch and Boehner.”

Emphasis added. Note the lack of interest in discussing anything
that could possibly provide that intra-party drama like how best to
approach ISIS in Syria and Iraq or how (or if!) to reform National
Security Agency surveillance rules. They don’t want to ruin their
big win with squabbling between the party’s libertarian-leaning
elements and its neoconservative members.

But it’s an issue that’s obviously not going away. Sen. Rand
Paul was front and center throughout the evening both for his
relationship with McConnell and the general understanding that he’s
going to be running for president (though no, he hasn’t announced
yet). Yet, Tom Cotton, the Republican who won a Senate seat in
Arkansas last night, is an archetypical neoconservative and Vox.com
(perhaps a bit hyperbolically) calls him “Rand Paul’s worst
nightmare.” He wanted New York Times reporters put behind
bars for exposing a U.S. surveillance program, and he is an Iraq
War vet who supports
military intervention
:

“I think that George Bush largely did have it right,” Cotton
said, “[in] that we can’t wait for dangers to gather on the
horizon, that we can’t let the world’s most dangerous people get
the world’s most dangerous weapons, and that we have to be willing
to defend our interests and the safety of our citizens abroad even
if we don’t get the approval of the United Nations.”

Cotton’s foreign policy hawkishness, and his backing from the
neoconservative establishment it’s brought, have helped shape his
political persona. “Cotton has staked his young political career on
a staunchly assertive, activist view of American military power,”

Politico
‘s Alexander Burns wrote in a 2013 profile. For
conservatives who support an aggressive foreign policy, “there is
no Republican under the age of 40 with more riding on his career
than Cotton,” Burns concludes.

The Republican Party is now going to have to hash out what it
stands for while it’s in a position of some strength. Neocon
columnist Jennifer Rubin is
insisting
that last night’s results aren’t because of the
popularity of a libertarian message. She will no doubt continue to
insist the case even if Paul lands the nomination in 2016, but
nevertheless it is true last night’s election didn’t affirm any
understanding of where the Republican Party is going.

Of course, it’s also extremely clear the same is true of the
Democrats, perhaps now even more so. Up until this point in Obama’s
presidential career the party has rallied around him and served
him. Whatever Obama stood for is what the party stood for. Without
Obama, the party is left with a bunch of progressive platitudes and
outcomes that they find desirable (raise the minimum wage, reduce
college debt) and no strategy on how to get there, especially now.
When identity politics play much less of a role in an election
outcome—note the lack of gay marriage issues on the ballot—they’re
struggling. Illinois Democrats manufactured some
progressive-friendly “advisory” votes in order to try lure out
voters, and yet their incumbent governor still lost. In President
Obama’s speech today he attempted to point to the successes of

minimum wage initiatives
in several states today as a win for
him, but the fact that Democratic candidates also lost in these
very same states suggest the party needs to be thinking beyond
begging young people to vote and thinking they can somehow defeat
conservative philosophies and purge them from the polity
forever.

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US Mint Sells Out Of Silver Eagles Following “Tremendous” Demand

When it comes to buyers of physical assets as opposed to traders of paper representations of such assets, there is one key difference: the latter, more than anything, enjoy looking at “heatmaps”, chasing trends and jumping on momentum, the result being the most recent massive selloff in such “paper” representations of precious metals as the GLD and SLV ETFs, and various gold futures.

On the other hand, those who prefer to hold the metal in their hands, as well as others such as China whose ravenous apetite for gold over the past 4 years has been extensively covered here in the past, take every advantage of selloffs, and – inconceivably – demonstrate how Econ 101, namely supply and demand, really works, leading to ever greater demand the lower the price. Demand so high, in fact, that the underlying commodity that is being sold through paper conduits, sells out.

This is precisely what happened at the U.S. Mint, which just sold out of all silver American Eagle silver bullion coins, following “tremendous” demand in the past several weeks, according to Reuters reports.

This should hardly come as a surprise: over the weekend we reported that “Silver Coin Sales At US Mint Soar To Highest In Two Years.”

Sales surged to 5.79 million ounces, the most since January 2013, the month that set an all-time high at 7.5 million, Bloomberg reports. “Today, sales jumped 33 percent in one of the busiest times this year”, Tom Jurkowsky, a spokesman at the Washington-based mint, said in an interview. Last month’s total was 4.14 million.

 

“We saw demand surge over the past two days,” Michael Kramer, the president of New York-based MTB Inc., a dealer authorized to purchase coins directly from the mint, said in a telephone interview. “Business was almost triple than what it has been over the past few months.”

 

Logically, as a result of the surge in physical demand, silver futures for December delivery dropped 1.9 percent to close at $16.106 an ounce on the Comex in New York. Earlier, the price touched $15.635, the lowest for a most-active contract since Feb. 25, 2010.

 

Because when it comes to precious metals, thanks to the BIS and the central banks, Paper beats Rock every time.

Which brings us to today, when according to an alert issued to dealers across the US, some 2 million ounces of silver sold out just after noon, Eastern time, following the sale of over 1 million ounces in just the first two days of the month.

In a statement sent to its biggest U.S. coin wholesalers, the U.S. Mint says it will continue to produce 2014-dated coins. The Mint will advise when additional inventory will become available for sale without providing further details.

 

The announcement has not been made available to the public, but a U.S. Mint spokesman confirmed that it has sent the statement to its authorized participants.

 

A sharp break in gold prices to their lowest in more than four years last week has unleashed a surge in demand for silver and gold coins in North America and Europe.

As A-Mark, one of the largest bullion distributors in the country added, “The US Mint has just announced that they are temporarily sold out of American Eagle Silver Bullion Coins.  They are in the process of producing more and will advise when additional inventory is available.  If you previously received fixed premium pricing from us, it is no longer valid.”

So… even lower prices coming, right?

And since everything else in the New Normal is now flipped on its head, it only makes sense that the continued price collapse for precious metals is, as it turns out, driven by ever greater demand!




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The Day After: An Interactive Sea Of Red

While one can debate the naivete of anyone expecting much if anything to change as a result of the midterm, or any, elections, one things is certain: America spoke up, and said the “recovery” of the past 6 years not only isn’t working but is the biggest lie perpetuated by the country’s true ruler: the Fed and its Wall Street bank “advisors”, and demanded change: something more than just fabricated daily record highs in the nominal values of assorted Fed-rigged pieces of paper.

The result: as the interactive map below, ironically from the NYT after the jump shows, is nothing short of a red storm rising.

Now if only it wasn’t all in absolute futility.




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Democrats Couldn’t Count on Women for Victories in Midterm 2014 Elections

Democrats in many states

were counting on women to win
election 2014 victories. It seems
to have been a bad bet. Liberal Senate candidates who put
particular emphasis on issues like birth control and equal pay
legislation were roundly defeated by Republican challengers last
night. 

The über case here comes out of Colorado, where Democratic Sen.
Mark Udall lost his seat to GOP Rep. Cory Gardner after running
heavily
on how Gardner would be bad for women
. It was a strange choice
for one of the few Democratic Senators who could have campaigned on

his record of questioning intelligence community abuses
. Udall
was championed by groups such as Human Rights Watch (HRW) and the
American Civil Liberties Union for his criticism of National
Security Agency (NSA) surveillance, his insistence on
declassification of the CIA’s post-9/11 interrogation techniques,
and his refusal to support National Defense Authorization Act
provisions allowing for indefinite detention of American citizens.
“He’s definitely deviated from the Obama administration on these
issues,” Laura Pitter, senior national security counsel at HRW,

told the Huffington Post

Gardner, meanwhile, scores pretty
low on support for civil liberties
. But in campaign literature
and TV ads, Udall largely emphasized his differences from Gardner
on social issues, particularly those related to contraception and
abortion. He hammered Gardner for previous support of a
Colorado personhood amendment
and repeatedly suggested that
Gardner wanted to ban birth control. 

Despite all this, female voter turnout Tuesday remained
stubbornly low in Colorado. This is far from unprecented—in
general, women, young adult, and minority voters tend to drop off
during non-presidential election years. But this year, Colorado
women’s turnout was
at its lowest point since 1992
, according to ABC News. And
while unmarried women did lean overwhelmingly Democrat, this
much-courted cohort did so at their smallest margin in over 20
years. 

In preliminary exit poll data from CNN, Sen. Udall managed to
capture 52 percent of Colorado’s women voters, compared to
Gardner’s 44 percent. But this wasn’t enough to make up for
Gardner’s 17 percent lead among men. And similar dynamics were seen
in other Senate races where Democrats had stressed GOP opposition
to abortion, health insurance coverage for contraception,
legislation meant to address gender pay gaps, and other issues
expected to rally women voters. 

In North Carolina, for instance, Republican Thom Tillis beat
incumbent Sen. Kay Hagan by just 2 percentage points overall. But
he lead by 15 percent among male voters, enough to trump Hagan’s 12
percent lead with women. In Alaska, Republican Dan Sullivan won
against incumbent Sen. Mark Begich by earning just 2 percent less
support from women but 11 percent more support from men. In Iowa,
Republican state Rep. Joni Ernst won her new Senate seat with 1
percent less of the female vote and 16 percent more of the male
vote.

In Kentucky, Senate Minority Leader Mitch McConnell kept his
seat by wooing both more male and more female voters; he beat
challenger Alison Lundergan Grimes by 3 percent among women and 25
percent among men. Arakansas’ Tom Cotton came out on top with 10
percent more female supporters than opponent Mark Pryor and 24
percent more male supporters. 

Exit poll data shows female voters
preferring Democratics by seven percentage points overall
,
according to the Wall Street Journal. “That was a
distinctly better showing than in the latest midterm elections, in
2010, when women broke for the GOP by a percentage point and helped
propel Republicans to control of the House,” the Journal
notes. Yet the gender gap still skewed in Republicans’ favor this
year, with GOP candidates capturing male voters by 13 percentage
points more. 

To be clear, it’s unlikely that focusing on supposed women’s
issues drove male voters away from
Democrats—that 13-point male lead Republicans enjoyed is pretty
standard fare for midterm elections. And men make up a majority of
the Republican party generally. A Pew Research Center Survey from
2012 found
52 percent of GOP or GOP-leaning voters
were male, compared to
43 percent of Democrats or Democratic-leaners.  

And there’s nothing to say that Democrat’s “GOP war on women”
rhetoric didn’t motivate some female voters who may have otherwise
sat this election out. Perhaps without it, we’d have seen even
bigger margins of GOP victory in states like North Carolina and
Alaska. 

But I’d love to be able to peer into some alternate reality
where Democrats like Udall had campaigned on opposition to CIA
torture and NSA spying; or had attempted to motivate their minority
bases by focusing on issues like those coming out of Ferguson,
Missouri; or had hitched their wagon to marijuana legalization in
states where it was on the ballot. These are some of the issues
that matter most right now to young voters—another group
historically absent from midterm voting, with last night being no
exception. Though 18- to 29-year-olds make up about a quarter of
the U.S. population, they accounted for just 13 percent of voters
yesterday. (The reverse is true for seniors, who constitute about
13 percent of the total population but represented 22 percent of
the midterm vote.)  

Could campaigns that emphasized opposition to civil-liberties
abuses, police brutality, and drug criminalization have captured
more ballot-box love from millennials? As we’ve seen in poll after
poll—from
Harvard’s
to
Pew Research Center’s
to our
own here at Reason
—millennials are massively dissatisfied with
traditional partisan options and more likely than any young cohort
previously to consider themselves political independents. And those
issues are ones not necessarily beholden to a natural partisan
divide. A Republican or a Democratic candidate who ran with them
could well capture post-party, post-Hope millennial passions (along
with older independents, too, of course). 

Instead, both parties keep choosing to run on the most partisan
of platforms and dog-whistles. (Democrats more so than Republicans
this year, though that’s not to the credit of GOP candidates, who

largely seemed to run on nothing
.) Republicans are still
relying on older white men and religious conservatives to carry
them. And Democrats keep hoping that if they just remind women and
minorities they’re On Their Side, Not Like Those Republicans, they
don’t actually have to have any ideas, do anything, or stand for
anything. 

It’s a great way to turn out exactly the people and
constituencies who would vote for you anyways. And sometimes an OK
way to eek out your own party’s dominance. It’s not a sound
strategy if you have any hope of actually affecting change, or
turning politics into anything but the sad, silly spectacle it is
currently. But I suppose that’s never the real goal anyway…

Funnily enough, many on the left are now dismissing last night’s
Democratic losses as a mere side effect of more male, white, and
over-45 voters—aka more Republicans—showing up at the polls. (See
the closing paragraph here for
one fine example.) It’s an effective bit of ass-covering on their
part, I guess, but I feel sorry for the future of the left if any
of them actually believe it convincing. The
excuse is, itself, just a restatement of the problem,” as Ezra
Klein
writes.

The fact that less registered Democrats, less millennials, and
less women turned up to vote is neither random nor some sort of
natural, immutable force. It is evidence that what the Democratic
Party and candidates are doing is not working. And if the best
their pundits can come up with afterward is, “well, that’s how
voter turnout goes,” we could be in for a GOP majority for much
longer than anyone expects.

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U.S. Mint Temporarily Sold Out of Silver Eagles on “Tremendous Demand”

WAR IS PEACE 
FREEDOM IS SLAVERY 
IGNORANCE IS STRENGTH
TREMENDOUS DEMAND = PRICE COLLAPSE 

Should be good for another $2 down.

From CNBC:

The U.S. Mint said on Wednesday it has temporarily sold out of its American Eagle silver bullion coins following “tremendous” demand in the past several weeks.

continue reading

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