HBO’s Chernobyl Presents Catastrophic History as Horror

Chernobyl. HBO. Monday, May 6, 9 p.m.

In the sepulchral darkness underneath the Chernobyl nuclear power plant, where poisoned water from the wrecked water-cooling tanks swirls madly to and fro and radioactive steam has burned out the lights, three technicians wade through the basement. They’ve volunteered to manually open water pipes that may—may—keep the plant’s reactor from a complete meltdown, but they can barely see where they’re going amid the superheated detritus of the nuclear core. When the killer radiation burns out the last of their flashlights, the darkness turns total and suffocating, broken only by the sound of their Geiger counters, rising from a clickety-clack to a hellish roar.

That scene from HBO’s Chernobyl miniseries is more terrifying than anything I’ve seen in a horror movie in decades. Or maybe not, because Chernobyl really is a horror movie: not just about errant technology, but also a maleficent portrait of an ideology that denies the existence of error.

As scary as the scene in the waters under the reactor is, the signature moment in Chernobyl may be a meeting among Communist Party bosses in the hours immediately after the explosion. One of the bureaucrats expresses doubt about the official insistence that radiation from the shattered plant is contained, even though outside, firemen and medical workers are writhing in their own blood and vomit. A senior apparatchik glares him down.

“Our faith in Soviet socialism will always be rewarded,” says the party elder. “Have faith, comrades.” It is not a suggestion.

The explosion of the Chernobyl reactor on April 26, 1986, was the start of one of the greatest man-made calamities in the history of the planet. The explosion of the reactor spewed so much radioactive fallout that more than a thousand square miles of the former Soviet Union remains abandoned to this day.

Somewhere between 4,000 and 93,000 people, depending on whose estimate you accept, died as a result of Chernobyl. (Except in the official annals of Soviet doublespeak, where the death toll is just 31.) Some Russian leaders—among them Mikhail Gorbachev, the last Soviet president—say the casualty list should include the Soviet Union itself, which within five years had vanished from the planet.

Producer and screenwriter Craig Mazin’s remarkable script doesn’t go quite that far in terms of either chronology or political implication. But it’s a chillingly powerful mosaic of the catastrophe, from its technical origins in pathological Soviet secrecy to the exorbitant toll it continued to exact on innocent people all over the country long after the reactor was contained.

That mosaic is assembled from the interlocking stories of about a dozen (mostly real; many doomed) characters, ranging from techs to physicists, firemen to soldiers. The backbone of the narrative is the tale of nuclear engineer Valery Legaslov (Jared Harris, The Crown) and deputy prime minister Boris Shcherbina (Stellan Skarsgard, River), an unlikely duo paired as investigators in the first hours after the explosion.

Legaslov is already skeptical about the official line that things in Chernobyl are under control; Shcherbina, like most senior party officials, believes the company line. “I prefer my opinion to yours,” he sneers to Legaslov, who retorts: “I’m a nuclear physicist. Before your present position, you worked in a show factory.”

Surprisingly, they wind up working well together, and Shcherbina swings around to become an effective advocate within the party for drastic action to mute the effects of the reactor.

By the time they learn that some Soviet scientists were aware of the defect that caused the Chernobyl explosion but were silenced by the government Shcherbina isn’t even surprised, just worried that the increasingly unhinged Legaslov will get them jailed or shot. “That went surprisingly well,” he tells Legaslov after one confrontation with party bosses. “You came off like a naive idiot. Naive idiots are not a threat.”

Legaslov, Shcherbina, and another physicist, Ula Khomyuk (a composite character played by Emily Watson, Angela’s Ashes) are heroic in their defiance of the Soviet government’s willful blindness.

But Mazin’s script finds courage in his other story threads, too: firefighters who charge on to the surface of the reactor even though their shoes are melting; a wife of a victim of radiation poisoning, committing slow-motion suicide by refusing to leave him to die alone.

There’s a group of coal miners who know their mission—they’ve been ordered to tunnel into the reactor to help clean it up—will have a lethal conclusion but press on anyway. When they’re not stripped naked to wield their shovels in the fierce underground heat, they’re cracking mordant anti-communist jokes:

“What’s as big as a house, burns 20 meters of fuel every hour, puts out a shitload of smoke and noise, and cuts an apple into three pieces? A Soviet machine made to cut apples into four pieces.”

Mazin’s script treats the Soviet state with a scalding, contemptuous rage not seen in Hollywood productions since the early days of the Cold War. After decades of systematic starvation, forced relocations and bloody purges, ordinary citizens are so cynical about their government that they assume the order to evacuate the diseased farmland around Chernobyl is just one more mindless act of repression.

Yet their fear of the West is real enough as well. More than once, in the moments after the explosion, somebody asks: “The Americans?” Chernobyl the TV show is a painful reminder that Chernobyl the cataclysm could have been inflicted thousands of times around the world, not accidentally but on purpose. And the surreal scenes of Soviet conscripts fitting themselves with lead diapers to protect their testicles from radiation as they roamed the vast quarantined area with rifles, shooting abandoned, contaminated family pets, could have happened here, too, the world ending with a bang and a whimper.

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HBO’s Chernobyl Presents Catastrophic History as Horror

Chernobyl. HBO. Monday, May 6, 9 p.m.

In the sepulchral darkness underneath the Chernobyl nuclear power plant, where poisoned water from the wrecked water-cooling tanks swirls madly to and fro and radioactive steam has burned out the lights, three technicians wade through the basement. They’ve volunteered to manually open water pipes that may—may—keep the plant’s reactor from a complete meltdown, but they can barely see where they’re going amid the superheated detritus of the nuclear core. When the killer radiation burns out the last of their flashlights, the darkness turns total and suffocating, broken only by the sound of their Geiger counters, rising from a clickety-clack to a hellish roar.

That scene from HBO’s Chernobyl miniseries is more terrifying than anything I’ve seen in a horror movie in decades. Or maybe not, because Chernobyl really is a horror movie: not just about errant technology, but also a maleficent portrait of an ideology that denies the existence of error.

As scary as the scene in the waters under the reactor is, the signature moment in Chernobyl may be a meeting among Communist Party bosses in the hours immediately after the explosion. One of the bureaucrats expresses doubt about the official insistence that radiation from the shattered plant is contained, even though outside, firemen and medical workers are writhing in their own blood and vomit. A senior apparatchik glares him down.

“Our faith in Soviet socialism will always be rewarded,” says the party elder. “Have faith, comrades.” It is not a suggestion.

The explosion of the Chernobyl reactor on April 26, 1986, was the start of one of the greatest man-made calamities in the history of the planet. The explosion of the reactor spewed so much radioactive fallout that more than a thousand square miles of the former Soviet Union remains abandoned to this day.

Somewhere between 4,000 and 93,000 people, depending on whose estimate you accept, died as a result of Chernobyl. (Except in the official annals of Soviet doublespeak, where the death toll is just 31.) Some Russian leaders—among them Mikhail Gorbachev, the last Soviet president—say the casualty list should include the Soviet Union itself, which within five years had vanished from the planet.

Producer and screenwriter Craig Mazin’s remarkable script doesn’t go quite that far in terms of either chronology or political implication. But it’s a chillingly powerful mosaic of the catastrophe, from its technical origins in pathological Soviet secrecy to the exorbitant toll it continued to exact on innocent people all over the country long after the reactor was contained.

That mosaic is assembled from the interlocking stories of about a dozen (mostly real; many doomed) characters, ranging from techs to physicists, firemen to soldiers. The backbone of the narrative is the tale of nuclear engineer Valery Legaslov (Jared Harris, The Crown) and deputy prime minister Boris Shcherbina (Stellan Skarsgard, River), an unlikely duo paired as investigators in the first hours after the explosion.

Legaslov is already skeptical about the official line that things in Chernobyl are under control; Shcherbina, like most senior party officials, believes the company line. “I prefer my opinion to yours,” he sneers to Legaslov, who retorts: “I’m a nuclear physicist. Before your present position, you worked in a show factory.”

Surprisingly, they wind up working well together, and Shcherbina swings around to become an effective advocate within the party for drastic action to mute the effects of the reactor.

By the time they learn that some Soviet scientists were aware of the defect that caused the Chernobyl explosion but were silenced by the government Shcherbina isn’t even surprised, just worried that the increasingly unhinged Legaslov will get them jailed or shot. “That went surprisingly well,” he tells Legaslov after one confrontation with party bosses. “You came off like a naive idiot. Naive idiots are not a threat.”

Legaslov, Shcherbina, and another physicist, Ula Khomyuk (a composite character played by Emily Watson, Angela’s Ashes) are heroic in their defiance of the Soviet government’s willful blindness.

But Mazin’s script finds courage in his other story threads, too: firefighters who charge on to the surface of the reactor even though their shoes are melting; a wife of a victim of radiation poisoning, committing slow-motion suicide by refusing to leave him to die alone.

There’s a group of coal miners who know their mission—they’ve been ordered to tunnel into the reactor to help clean it up—will have a lethal conclusion but press on anyway. When they’re not stripped naked to wield their shovels in the fierce underground heat, they’re cracking mordant anti-communist jokes:

“What’s as big as a house, burns 20 meters of fuel every hour, puts out a shitload of smoke and noise, and cuts an apple into three pieces? A Soviet machine made to cut apples into four pieces.”

Mazin’s script treats the Soviet state with a scalding, contemptuous rage not seen in Hollywood productions since the early days of the Cold War. After decades of systematic starvation, forced relocations and bloody purges, ordinary citizens are so cynical about their government that they assume the order to evacuate the diseased farmland around Chernobyl is just one more mindless act of repression.

Yet their fear of the West is real enough as well. More than once, in the moments after the explosion, somebody asks: “The Americans?” Chernobyl the TV show is a painful reminder that Chernobyl the cataclysm could have been inflicted thousands of times around the world, not accidentally but on purpose. And the surreal scenes of Soviet conscripts fitting themselves with lead diapers to protect their testicles from radiation as they roamed the vast quarantined area with rifles, shooting abandoned, contaminated family pets, could have happened here, too, the world ending with a bang and a whimper.

from Latest – Reason.com http://bit.ly/2ZT9voR
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BofA: “In 1954 It Took 25 Years; Now – Just 215 Days”

Just how much power do central banks have to manipulate and direct what by now should be clear to anyone is the world’s most centrally planned “market” in history? Here is a number from Bank of America’s Chief Investment Officer demonstrating just that: 215.

As BofA writes this morning, “once upon a time (between 7th Sept 1929 & 22nd Sept 1954) it took 9,146 days for the S&P500 to reach a new high following a >20% bear drop.” Fast forward to 2019, when the S&P 500 took just 215 days to recover and surpass its old high.

So now that the Fed has made it clear it will never allow the market to drop materially – as any significant drop and/or recession will jeopardize what little faith is left in the wealth effect and the Fed’s powers – there is another number to keep in mind: 3,498.

Why? Because as of 2018, the S&P500 bull market was already the longest ever; however for the S&P500 to become longest and largest of all-time – which it may have no choice but to do in a world where every central bank is now all in on reflating risk assets – it will have to hit 3,498.

What is ironic is that with the S&P at all time highs, investor  skepticism that anything about this rally is real continues to grow, and instead of fund flows into stocks, last week was another week of big inflows of $9.6BN but into bonds; meanwhile equities saw yet another week of redemptions ($0.3 billion), with total outflows from equities now a staggering $95 billion (more than all coming out of Long Only active equity funds), offset by $140 billion in bond inflows.

It’s not just institutions: BofA’s high net worth private clients also sold stocks and bought bonds over the past 8 weeks (0.2% & 1.2% of asset class AUM respectively); As BofA further explains, its high net worth clients’ETF portfolio (14% AUM) shows rotation from EM debt & HY to IG, Eurozone & Japan equities to EM, cyclicals to bond proxies (Chart 4).

Explaining who is buying, and who is selling, Hartnett writes that “Capitalists front-run populists“, and explains:

S&P reports Q1 buybacks up 12.1% YoY, almost 1/3 US companies boosting their YoY EPS growth by >4pps thanks to share count reduction;

The punchline “corporates rather than private clients & institutions driving equity prices.”

And since they are not buying stocks, investor flows are almost entirely into IG bond funds & EM funds (both equity & debt) both are currently at cumulative all-time highs, showing how powerful the “yield” theme has been for the past decade.

So with all that, where does the market stand in terms of the three Ps – positioning, policy and profits? Here is the answer from BofA:

  • On positioning: BofAML Bull & Bear Indicator up to 5.1 (Chart 2), highest since Feb; surge to sell-signal of >8.0 requires a. $50bn inflows to EM equity, EM debt & HY bond funds (vs. just $10bn past 6 weeks), b. overbought equity indices (>80% above 50- & 200-DMA vs. 42% today), c. May BofAML Global FMS cash levels dropping <4.3%; these all suggest investor “greed” is in credit, not stocks.
  • On policy: past 10 days Fed & PBoC failed to “out-dove” rate expectations, impeding the “breathless” rally in assets this year; universal complacency on endless low rates evident in record low MOVE index; but PBoC to remain easy until China labor market recovers (China employment PMI currently lowest since 2012), and Fed stays easy until US inflation picks-up; bottom line: we expect monetary policy to remain easy and for dips to be bought; tomorrow’s inflation data that could hurt fixed income = wages (AHE) >0.4% MoM & non-manufacturing ISM price index >60.
  • On profits: rise in EPS expectations likely in coming months; estimate of BofAML Global EPS model (currently -7%) has turned higher on China financial conditions, Asian exports & global PMIs; but MSCI ACWI PE has already jumped 2.4ppt YTD (from 12.9x to 15.2x) and rare for this to occur without higher EPS;


    poor ISM report showed US order-to-inventory ratio at lowest since 2012 = a likely harbinger of weaker US EPS growth (Chart 1);

So today’s latest spike higher on “goldilocks” labor market data, here is the BofA bottom line: SOX needs to hold 1400, and the CRB commodity price index needs to hold 400 to prevent investor “selling cyclicals in May”.

via ZeroHedge News http://bit.ly/2vzHGDZ Tyler Durden

Facebook Has Every Right To Ban Louis Farrakhan and Alex Jones. But It’s Still a Bad Idea.

Facebook announced yesterday that it was permanently banning Louis Farrahkhan, Alex Jones, Infowars, Milo Yiannopoulis, Paul Nehlen, Laura Loomer, and Paul Joseph Watson from Facebook and its sister service, Instagram. Each of these accounts, the company says, violated Facebook’s community standards governing “Dangerous Individuals and Organziations.” Among other things, these

do not allow any organizations or individuals that proclaim a violent mission or are engaged in violence, from having a presence on Facebook. This includes organizations or individuals involved in the following:

  • Terrorist activity
  • Organized hate
  • Mass or serial murder
  • Human trafficking
  • Organized violence or criminal activity

We also remove content that expresses support or praise for groups, leaders, or individuals involved in these activities.

Yesterday’s action was partly intended to combat a “loophole” that allowed Infowars and Jones, who had already been banned by the service, to keep appearing on it. Unofficial fan pages widely shared material from Infowars and Jones. As Wired explains, Facebook plans to stop them with a tool

usually reserved for terrorist organizations and self-proclaimed hate groups. The company says that users will be prohibited from sharing Infowars videos, radio clips, articles, and other content from the site unless they are explicitly condemning the material. Fan pages or groups that reshare Infowars content in a sincere or appreciative manner won’t be permitted.

As a private platform, Facebook is completely within its legal rights to ban whomever it chooses for pretty much whatever reason it wants. But whether it’s wise to start banning awful, stupid expression that falls short of true threats and other illegal activity is a very different matter. I’d argue that it’s not, as it feeds into the tendency to try suppress beliefs that one considers contemptible, dangerous, or evil. Those are not sharply delimited categories, and the tendency will be for more and more material to be seen as worthy of being policed, regulated, and eliminated. That is what’s happening on many college campuses, and the results are not encouraging for a society that believes in freedom of expression.

The better solution for social media platforms is to give users robust tools to filter and control content, and to foster an online culture that that is broadly tolerant of diverse viewpoints and conducive to new forms of media literacy. The promise of social media platforms, which are distinct from more traditional forms of publishing or distribution (such as an edited outlet such as Reason.com), are that they allow individuals not just to express ourselves almost effortlessly but to tailor our feeds to infinitely individualized tastes. We are losing some of the utopian potential of the internet every time a new clampdown on content or process takes place.

Facebook’s action comes a broader context in which support for free expression is slipping on both governmental and private fronts. In the wake of the Christchurch mosque shooting in March, for instance, the New Zealand government banned not only certain types of guns but possession of the manifesto written by alleged shooter Brenton Tarrant and footage of his killing spree (which was livestreamed briefly on Facebook before being taken down). A 22-year-old man has been arrested for distributing video of the shooting and faces up to 14 years in jail. Even more worrying, writes Jack Shafer at Politico, New Zealand’s five top media outlets have voluntarily agreed to censor their coverage of Tarrant’s trial.

The news organizations vow to limit coverage of statements “that actively champion white supremacist or terrorist ideology,” avoid quoting the accused killer’s “manifesto,” and suppress any “message, imagery, symbols” or hand signs like a Nazi salute made by the accused or his supporters in support of white supremacy. “Where the inclusion of such signals in any images is unavoidable, the relevant parts of the image shall be pixelated,” the guidelines add.

Shafer argues that paternalism barely begins to describe what’s going on here:

The Kiwi editors don’t appear to trust their readers and viewers to handle the difficult and disturbing material that’s sure to billow out of the Tarrant trial. They regard New Zealanders as children who must be sheltered from the heinous and despicable lest they become tainted with its influence. That’s essentially the position New Zealand Chief Censor [David] Shanks took when he banned the manifesto in March, saying that documents like it were aimed at a “vulnerable and susceptible” audience and designed to incite them to perform similar crimes. “There is content in [the manifesto] that points to means by which you can conduct other terrorist atrocities…it could be seen as instructional,” Shanks said.

Although the New Zealand media have promised to thoroughly cover the trial, Shafer is right to suspect that reporters will do a particularly good job “from a crouch.” He’s also correct to worry that “the journalistic groupthink encouraged by the pact could result in undercoverage of extremist movements and leave readers unnecessarily vulnerable.”

Something similar is at work with Facebook’s ban. The company seems worried that its users are impressionable people liable to be gulled into believing nonsense. It also probably just doesn’t want to associated with offensive content of all kinds. But nobody should assume that Facebook supports, say, Alex Jones, just because they allow him to use their service, any more than whatever phone service he uses supports him because he makes calls on it.

We live in a moment when the tech giants themselves are explicitly calling for regulation, both to stave off certain forms of government intervention and to lock in current market positions. Politicians as different as House Speaker Nancy Pelosi (D–Calif.) and Sen. Josh Hawley (R–Mo.) are threatening to regulate online speech and to end to the internet as we’ve known it by gutting Section 230 of the Communications Decency Act. In Europe, copyright law is being marshaled to stifle the free exchange of ideas and content in order to protect legacy entertainment companies. Massively overhyped fears about the influence of Russian trolls during the 2016 election have given rise to story after story about how stupid Facebook users are, a prelude to empowering the very sort of gatekeepers we supposedly left behind when we migrated en masse into cyberspace in the mid-1990s. An era is passing away, not because of the foulness of online trolls but because of the institutional response they’ve inspired.

 

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Facebook Has Every Right To Ban Louis Farrakhan and Alex Jones. But It’s Still a Bad Idea.

Facebook announced yesterday that it was permanently banning Louis Farrahkhan, Alex Jones, Infowars, Milo Yiannopoulis, Paul Nehlen, Laura Loomer, and Paul Joseph Watson from Facebook and its sister service, Instagram. Each of these accounts, the company says, violated Facebook’s community standards governing “Dangerous Individuals and Organziations.” Among other things, these

do not allow any organizations or individuals that proclaim a violent mission or are engaged in violence, from having a presence on Facebook. This includes organizations or individuals involved in the following:

  • Terrorist activity
  • Organized hate
  • Mass or serial murder
  • Human trafficking
  • Organized violence or criminal activity

We also remove content that expresses support or praise for groups, leaders, or individuals involved in these activities.

Yesterday’s action was partly intended to combat a “loophole” that allowed Infowars and Jones, who had already been banned by the service, to keep appearing on it. Unofficial fan pages widely shared material from Infowars and Jones. As Wired explains, Facebook plans to stop them with a tool

usually reserved for terrorist organizations and self-proclaimed hate groups. The company says that users will be prohibited from sharing Infowars videos, radio clips, articles, and other content from the site unless they are explicitly condemning the material. Fan pages or groups that reshare Infowars content in a sincere or appreciative manner won’t be permitted.

As a private platform, Facebook is completely within its legal rights to ban whomever it chooses for pretty much whatever reason it wants. But whether it’s wise to start banning awful, stupid expression that falls short of true threats and other illegal activity is a very different matter. I’d argue that it’s not, as it feeds into the tendency to try suppress beliefs that one considers contemptible, dangerous, or evil. Those are not sharply delimited categories, and the tendency will be for more and more material to be seen as worthy of being policed, regulated, and eliminated. That is what’s happening on many college campuses, and the results are not encouraging for a society that believes in freedom of expression.

The better solution for social media platforms is to give users robust tools to filter and control content, and to foster an online culture that that is broadly tolerant of diverse viewpoints and conducive to new forms of media literacy. The promise of social media platforms, which are distinct from more traditional forms of publishing or distribution (such as an edited outlet such as Reason.com), are that they allow individuals not just to express ourselves almost effortlessly but to tailor our feeds to infinitely individualized tastes. We are losing some of the utopian potential of the internet every time a new clampdown on content or process takes place.

Facebook’s action comes a broader context in which support for free expression is slipping on both governmental and private fronts. In the wake of the Christchurch mosque shooting in March, for instance, the New Zealand government banned not only certain types of guns but possession of the manifesto written by alleged shooter Brenton Tarrant and footage of his killing spree (which was livestreamed briefly on Facebook before being taken down). A 22-year-old man has been arrested for distributing video of the shooting and faces up to 14 years in jail. Even more worrying, writes Jack Shafer at Politico, New Zealand’s five top media outlets have voluntarily agreed to censor their coverage of Tarrant’s trial.

The news organizations vow to limit coverage of statements “that actively champion white supremacist or terrorist ideology,” avoid quoting the accused killer’s “manifesto,” and suppress any “message, imagery, symbols” or hand signs like a Nazi salute made by the accused or his supporters in support of white supremacy. “Where the inclusion of such signals in any images is unavoidable, the relevant parts of the image shall be pixelated,” the guidelines add.

Shafer argues that paternalism barely begins to describe what’s going on here:

The Kiwi editors don’t appear to trust their readers and viewers to handle the difficult and disturbing material that’s sure to billow out of the Tarrant trial. They regard New Zealanders as children who must be sheltered from the heinous and despicable lest they become tainted with its influence. That’s essentially the position New Zealand Chief Censor [David] Shanks took when he banned the manifesto in March, saying that documents like it were aimed at a “vulnerable and susceptible” audience and designed to incite them to perform similar crimes. “There is content in [the manifesto] that points to means by which you can conduct other terrorist atrocities…it could be seen as instructional,” Shanks said.

Although the New Zealand media have promised to thoroughly cover the trial, Shafer is right to suspect that reporters will do a particularly good job “from a crouch.” He’s also correct to worry that “the journalistic groupthink encouraged by the pact could result in undercoverage of extremist movements and leave readers unnecessarily vulnerable.”

Something similar is at work with Facebook’s ban. The company seems worried that its users are impressionable people liable to be gulled into believing nonsense. It also probably just doesn’t want to associated with offensive content of all kinds. But nobody should assume that Facebook supports, say, Alex Jones, just because they allow him to use their service, any more than whatever phone service he uses supports him because he makes calls on it.

We live in a moment when the tech giants themselves are explicitly calling for regulation, both to stave off certain forms of government intervention and to lock in current market positions. Politicians as different as House Speaker Nancy Pelosi (D–Calif.) and Sen. Josh Hawley (R–Mo.) are threatening to regulate online speech and to end to the internet as we’ve known it by gutting Section 230 of the Communications Decency Act. In Europe, copyright law is being marshaled to stifle the free exchange of ideas and content in order to protect legacy entertainment companies. Massively overhyped fears about the influence of Russian trolls during the 2016 election have given rise to story after story about how stupid Facebook users are, a prelude to empowering the very sort of gatekeepers we supposedly left behind when we migrated en masse into cyberspace in the mid-1990s. An era is passing away, not because of the foulness of online trolls but because of the institutional response they’ve inspired.

 

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via IFTTT

That Time Bernie Sanders Interviewed Some Punk-Rock Kids in a Mall

Bernie Sanders had his own TV program from 1986 to 1988, back when the socialist senator was mayor of Burlington, Vermont. The show was called Bernie Speaks, it aired on public access TV, and Politico just had the full run digitized. As Sanders makes his second bid for the Democratic presidential nomination, those digitized episodes have now been posted on the cable access channel’s website, where anyone with an internet connection can explore them.

“Over the past few weeks, I watched them all,” Holly Otterbein writes in Politico. “The production values are so low that they’re sometimes hard to hear and see, which makes them feel more valuable, like an archive of lost secrets.” The topics covered, she reports, “include Plato, Ronald Reagan, Jesse Jackson’s 1988 presidential campaign, the ‘immorality’ of the war in Nicaragua, the ‘stupid’ property tax, the effects of the looming nuclear apocalypse on children, Burlington’s waterfront, Burlington’s trash dump, Burlington’s snowplow operation, the ‘incredible increase’ in crime, the close-fisted state Legislature, the rich getting richer, the poor getting poorer and the reasons that punk rockers wear black.”

Unlike Otterbein, I haven’t watched them all. But I did check out that last one. The episode originally aired in March 1988, and it mostly consists of Sanders playing roving reporter at the Burlington Square Mall. About halfway through the program, he starts talking with a couple of friendly punk-rock kids. He asks them what they don’t like about society. They reply with a collection of complaints, some vague and some highly specific, that—speaking as someone who in March of 1988 was 17 and listening to punk rock and sometimes hanging out in malls—is as good a condensation as you’re ever likely to find of a particular teenage worldview in that particular historical moment. “People are not open-minded enough,” one says. “They think that in order to be stable in society you have to have money, you have to live in a suburb, you have to do the ‘set’ things, such as have so many people over for dinner…a week, or you’re not socially acceptable. You’ve got to dress a certain way to be socially acceptable. And I don’t believe in having to belong to anything to be a person. I can do basically what I want with my appearance, with my attitude, and it doesn’t matter.”

They both identify themselves as anarchists, as 1980s mall-punks were prone to do. But most people’s politics are a mish-mosh, and that’s true here too. One of them says he’d be happy in a communist society with “no freedom of enterprise” as long as there’s still freedom of speech. The other says she’s “kind of an anarchist too, but I don’t believe in total anarchy, because then we’re just gonna kill ourselves.” Sanders plays his Phil Donahue role with aplomb, holding the mic and nodding his head encouragingly.

No doubt there’s more newsworthy stuff in this archive. Mayor Sanders had things to say about everything from the Sandinistas to socialized medicine, from local taxes to housing policy. Historians, journalists, Bernie fans, oppo researchers—there’s something in here for all of them. But in these Friday A/V Club posts we like to zero in on weirdly illuminating little cultural artifacts, and what could be more weirdly illuminating than a future presidential candidate wandering around a shopping center with a microphone? Besides, the mall punks are making me nostalgic. To see them for yourselves, start at the 14:21 mark:

(For past editions of the Friday A/V Club, go here.)

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Eurodollar Skew Offers Great Opportunity To Fight ‘Dovish’ Fed

Authored by Kevin Muir via The Macro Tourist blog,

Whenever I hear words like “market makers say this is the largest skew they can remember”, my ears perk up. Even if they are incorrect, even if the distortion has been higher in the past – it’s clear something is not quite as it should be. As Han would say, “I have a bad feeling about this…

What am I talking about? Options on eurodollar futures. No, not the euro currency, but the 3-month US dollar denominated interest rate futures contract. It’s not quite the same as Fed Funds as there is some credit risk (it’s the rate at which banks lend US dollars to one another offshore), yet it tracks closely enough that for all intents and purposes, it’s betting on future Fed policy.

The market for Eurodollar futures is big. And liquid. The open interest is over $1.65 trillion. Yup. Trillion with capital “T”. Most contract months are half a tick wide with more often than not, a 100 million on the bid or offer. The Eurodollar futures contract is the ultimate institutional market and all too often gets completely ignored by the financial news media.

And when it is mentioned, it’s rarely an article about the skew in the option market. But it’s an important story, so I will take some time to explain (or at least try) the intricacies in the eurodollar option market and then speculate on what they might mean.

Elvis-Presley smirk

Most everyone understands the Elvis-Presley half-smile in the equity index option market.

What’s that expression? Stocks go up the escalator but come down the elevator. This tendency for stocks to be more volatile on the downside creates a situation where option players price out-of-the-money puts with a much higher implied volatility than the rest of the curve.

But what about eurodollar futures? What sort of skew should they trade with? If we think back to the past few decades, most of the surprise large moves were from the Fed doing an emergency rate cut, not a raise. Eurodollar contracts are priced off an index which is 100 minus the LIBOR rate. This means that rate cuts result in the eurodollar futures contract rising in price.

We would therefore expect the skew on the eurodollar futures option contract to be tilted in the opposite manner to the equity index market. Market participants should pay higher implied volatilities for strikes that are out of the money on the upside.

And that is exactly how the market is currently set up.

Here is the current bid-offer for the option series on the December 2019 eurodollar futures contract. Pay special attention to the column labeled IVB – that stands for Implied Volatility Bid. This is the calculated implied volatility based on the bid.

Let’s backtrack to the original comment from the market makers. You know, the one about this being the largest skew they can remember. What do they mean?

They are talking about the stunning difference between the implied volatility of the upside calls and the downside puts. Look at the out-of-the-money calls. They are bid in the 20%’s. Then compare it to the out-of-the-money puts. They are giving those puts away with implieds in the low teens.

This skew has been created through a relentless institutional order flow of players buying upside gamma and sell downside protection over the past couple of months.

If we knew the forward price volatility for the eurodollar futures contract would be normally distributed – that there would be no tendency for the up moves to be any larger or more frequent than the down moves, then this option skew would be an absolute phenomenal opportunity. An option market maker would sell the out-of-the-money calls for 20% vol and buy the out-of-the-money puts for 12%. After delta hedging through the life of the option, and assuming the price volatility was normally distributed and didn’t have a fat tail to the upside, the 8% vol difference would be pure profit.

However, we don’t know for sure what the forward price distribution will look like. Yet we can deduce the message the marketplace is sending based on this pricing.

The market overwhelmingly believes the next move for the Federal Reserve is to cut. And even though the curve is already pricing in some easing, participants are concerned there will be a dramatic downside surprise move in rates. That’s why they are willing to pay this record skew in eurodollar futures options.

The pros are bearish

This fits with my narrative that professional investors are increasingly bearish on both the economy and risk assets (”One Group will be Spectactularly Wrong”). Money managers are demanding protection against lower rates. And they are bidding for that protection at levels of skew that is either unprecedented, or close enough to a record to not matter.

Don’t underestimate the signal this eurodollar option skew is sending. Market participants will not be surprised with lower rates. That is what they are expecting. Professional market participants have convinced themselves the economy is rolling over. The business cycle has turned and it’s only a matter of time before Powell is panicking by slashing rates lower. If this scenario does not come to pass, then they will have bet incorrectly.

However, and this is where it gets nuanced, given the record skew even if they are correct about the direction of rates, it might be all priced in. Trading is all about the difference between expectations and reality. Sometimes it’s difficult to judge expectations. Yet other times the record skew screams out loud which way the professionals are leaning.

Not everyone is in that camp

I am less bearish on the economy than most professional investors. Maybe I just don’t get it. Maybe I am a fool for believing the tax cut stimulus has not yet finished making its way through the economy. Perhaps I am not knowledgeable enough to understand that regardless of Powell’s violent flip-flop the Fed cannot extend the business cycle. Yeah, I can understand why you might ignore my ramblings.

However, it might be easy to dismiss my ridiculous world-will-not-end-tomorrow call, but what about Guggenheim’s Scott Minerd’s forecast?

Scott believes the Fed’s next move is a hike! Talk about an out-of-consensus view.

This goes against what almost everyone else believes.

It’s above my pay grade to predict if the Fed’s next move is a hike or a cut, but I know one thing for certain – the market will react violently differently between those two scenarios.

Assuming the Fed is not cutting because of some geopolitical disaster, but rather because the economy has simply rolled over, an easier Fed policy move would be welcomed by the market. But make no mistake – it would be largely priced in. It would be met with muted price changes and most likely disappointment the Fed was not even more aggressive.

However if the Guggenheim view ends up playing out, the violence in the short end of the fixed-income market will be epic.

We have rallied hard off the lows from when Powell was leaning heavily hawkish with his “we are a long way from neutral” comments.

But have we rallied too much? Doesn’t the fact that even with this rally, market participants are gobbling up record amounts of out-of-the-money calls, not cause you pause?

I can tell you one thing for sure – when all the pros are leaning one way, I wouldn’t want to be in their camp.

Cheap way to bet

Yet if you believe that Scott Minerd is correct and that the next move is a Fed hike, there is probably no better way to play that outcome than snapping up some of these cheap puts. The distorted skew means they are practically giving them away.

Getting long cheap gamma in out-of-the-money eurodollar puts is probably the best way to express the view that the American economy is not quite as late-cycle as the market suspects. And here is a thought I would like to leave the economic bears with; given the record steep skew, hedging a long eurodollar futures position with protective puts is probably a strategy to seriously consider.

via ZeroHedge News http://bit.ly/2DKhUSg Tyler Durden

That Time Bernie Sanders Interviewed Some Punk-Rock Kids in a Mall

Bernie Sanders had his own TV program from 1986 to 1988, back when the socialist senator was mayor of Burlington, Vermont. The show was called Bernie Speaks, it aired on public access TV, and Politico just had the full run digitized. As Sanders makes his second bid for the Democratic presidential nomination, those digitized episodes have now been posted on the cable access channel’s website, where anyone with an internet connection can explore them.

“Over the past few weeks, I watched them all,” Holly Otterbein writes in Politico. “The production values are so low that they’re sometimes hard to hear and see, which makes them feel more valuable, like an archive of lost secrets.” The topics covered, she reports, “include Plato, Ronald Reagan, Jesse Jackson’s 1988 presidential campaign, the ‘immorality’ of the war in Nicaragua, the ‘stupid’ property tax, the effects of the looming nuclear apocalypse on children, Burlington’s waterfront, Burlington’s trash dump, Burlington’s snowplow operation, the ‘incredible increase’ in crime, the close-fisted state Legislature, the rich getting richer, the poor getting poorer and the reasons that punk rockers wear black.”

Unlike Otterbein, I haven’t watched them all. But I did check out that last one. The episode originally aired in March 1988, and it mostly consists of Sanders playing roving reporter at the Burlington Square Mall. About halfway through the program, he starts talking with a couple of friendly punk-rock kids. He asks them what they don’t like about society. They reply with a collection of complaints, some vague and some highly specific, that—speaking as someone who in March of 1988 was 17 and listening to punk rock and sometimes hanging out in malls—is as good a condensation as you’re ever likely to find of a particular teenage worldview in that particular historical moment. “People are not open-minded enough,” one says. “They think that in order to be stable in society you have to have money, you have to live in a suburb, you have to do the ‘set’ things, such as have so many people over for dinner…a week, or you’re not socially acceptable. You’ve got to dress a certain way to be socially acceptable. And I don’t believe in having to belong to anything to be a person. I can do basically what I want with my appearance, with my attitude, and it doesn’t matter.”

They both identify themselves as anarchists, as 1980s mall-punks were prone to do. But most people’s politics are a mish-mosh, and that’s true here too. One of them says he’d be happy in a communist society with “no freedom of enterprise” as long as there’s still freedom of speech. The other says she’s “kind of an anarchist too, but I don’t believe in total anarchy, because then we’re just gonna kill ourselves.” Sanders plays his Phil Donahue role with aplomb, holding the mic and nodding his head encouragingly.

No doubt there’s more newsworthy stuff in this archive. Mayor Sanders had things to say about everything from the Sandinistas to socialized medicine, from local taxes to housing policy. Historians, journalists, Bernie fans, oppo researchers—there’s something in here for all of them. But in these Friday A/V Club posts we like to zero in on weirdly illuminating little cultural artifacts, and what could be more weirdly illuminating than a future presidential candidate wandering around a shopping center with a microphone? Besides, the mall punks are making me nostalgic. To see them for yourselves, start at the 14:21 mark:

(For past editions of the Friday A/V Club, go here.)

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Whistleblower Sues SEC For Dragging Its Feet On Reward Payout

A whistleblower in an FCPA case involving Teva Pharmaceuticals is now taking the SEC to federal court, claiming that the agency is taking too long to grant him a reward, according to the WSJ. The tipster filed a petition on Monday asking the court to compel the agency to make a preliminary decision within 60 days.

According to the petition, it has now been 2 years since the tipster applied for compensation from the SEC – a time period the whistleblower’s lawyers claim is “unreasonable”.

The amount of time it takes the SEC to pay out on whistleblower awards has been a growing concern among those who offer tips. Often, the SEC takes around 2 years to make a determination and awards can sometimes amount to several million dollars for large cases. 

Between 2014 and 2017, the agency’s average was “more than two years” to make a determination, according to an analysis by The Wall Street Journal. This is twice as long as it took the agency in 2012 and 2013, while the program was still in its infancy. Suing the SEC to compel for an award isn’t something new: another tipster did the same in 2015 but the case was dismissed within 60 days after the SEC ultimately made a decision. In that respect, the strategy worked. 

Last year, the SEC took in 5,282 whistleblower tips, an increase of 18% from a year earlier. It’s also about twice the number received in 2012, according to a report the SEC recently made to congress. There has been “a flood of requests for awards” over the last few years.

Under law, tipsters are entitled to between 10% and 30% of the monetary penalties paid by companies as a result of SEC enforcement actions. As it relates to this case, Teva wound up paying $519 million in 2016 to settle charges that it violated FCPA laws in Mexico, Ukraine and Russia. 

Sean McKessy, a lawyer at Phillips & Cohen LLP, who previously served as chief of the SEC’s whistleblower office says that suing the agency may not be the best idea: “The agency often faces factors outside of its control that can delay the decisions it makes on awards. In some cases, the SEC has to make a determination on several applications for a single award.”

He continued: “If you’re going to blow up a relationship when you know you’re going to need some help from that entity in the future, it doesn’t make sense to me.”

via ZeroHedge News http://bit.ly/2PMJAdV Tyler Durden

A Terminally Ill, Wheelchair-Bound Inmate Applied for Compassionate Release. The Justice Department Argued He Wasn’t Dying Fast Enough To Qualify.

When is a wheelchair-bound inmate with brain cancer not considered terminally ill? When a Justice Department lawyer is evaluating his medical record.

On Wednesday a judge ordered the release of federal inmate Steve Brittner, 55, under the new provisions of the FIRST STEP Act, a criminal justice bill passed late last year. The judge ordered the release over the objections of federal prosecutors, who argued that Brittner, who is suffering from a malignant brain tumor, does not meet the “extraordinary and compelling” reasons to qualify for what’s known as “compassionate release.”

Brittner’s case illustrates both the impact of the new law and the extraordinary hurdles terminally ill inmates and their families still face when trying to squeeze a small amount of mercy out of the federal government.

One provision of the FIRST STEP Act allows federal inmates to take their pleas to a judge if the federal Bureau of Prisons (BOP) rejects their petitions for compassionate release—a policy that is supposed to afford elderly and terminally ill inmates the opportunity to finish their lives among family and in relative peace.

As Reason reported last year, the petition process for compassionate release has long been arbitrary, inscrutable, and cruel. Justice Department records obtained last year by the criminal justice advocacy group FAMM show that since 2014, at least 81 federal inmates have died while waiting for the government to review their applications.

Brittner was sentenced in 2016 to 48 months in federal prison for distributing methamphetamines. In January 2018, he was diagnosed with brain cancer. By that November, an oncologist listed his prognosis as “poor” and discussed the possibility of ending treatment and beginning end-of-life hospice care. Brittner reported fatigue, weakness, and increasing memory loss. According to court filings, he is increasingly confined to a wheelchair.

Brittner filed two petitions for compassionate release to the BOP, and both times the BOP rejected them on the grounds that his life expectancy exceeded his release date.

A month later, Donald Trump signed the FIRST STEP Act into law. Brittner then filed a motion to a federal judge to review his case under the new provisions. But the Justice Department opposed his motion on several grounds, including that his brain cancer, while deadly, was not spreading, and the median life expectancy for his condition is two to three years.

“Although defendant’s medical records show that he was diagnosed with a malignant brain tumor, those records do not indicate that the tumor has metastasized,” the U.S. Attorney’s Office of Montana wrote in a response to Brittner’s motion. “Rather, the records show that the tumor has not recurred or progressed since surgery in March 2018.”

The U.S. government was arguing, in essence, that Brittner wasn’t dying fast enough to qualify for compassionate release.

U.S. District Judge Dana Christensen disagreed. She ruled that the Justice Department’s interpretation of the FIRST STEP Act was seriously flawed. A metastatic brain tumor was only one of several examples of conditions that qualify as terminal illnesses, not part of an exclusive list. (She also noted that the overall survival time for those with Brittner’s particular type of brain tumor is closer to one year.)

“It is clear from the nature of his disease and his worsening condition as documented above, that Brittner’s prognosis is grim, his disease is terminal, and the length of his life can be measured most likely in weeks, as opposed to months,” Christensen wrote in her order granting Brittner compassionate release.

“Finally, the Court is convinced that Brittner poses no safety risk to the community,” Christensen continued. “Brittner is in an advanced stage of cancer and is wheelchair bound.”

“This is a very telling case,” says FAMM president Kevin Ring. “On one hand, the First Step Act’s reforms to compassionate release worked as intended and this family prevailed. On the other hand, it blows my mind that the Justice Department and BOP still fought tooth and nail to keep a low-level drug offender who is dying of brain cancer and bound to a wheelchair away from his family for the final weeks of his life. They’ll say they were just doing their jobs, but their job is to do justice.”

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