Bitcoin Set For $288K Bull Run In 2020, Popular BTC Price Model Says

Bitcoin Set For $288K Bull Run In 2020, Popular BTC Price Model Says

Tyler Durden

Wed, 07/01/2020 – 15:25

Authored by William Suberg via CoinTelegraph.com,

The latest update of Bitcoin’s S2FX price model shows July is beginning exactly as required for a long-term bullish trajectory to continue.

image courtesy of CoinTelegraph

Bitcoin (BTC) may be struggling to hit $10,000, but its progress is right on track, new stock-to-flow data confirms.

Adding a new update to his model on July 1, stock-to-flow model creator PlanB showed that Bitcoin is behaving exactly as its bullish history demands.

Bitcoin adds second “red dot”

The BTC S2F Cross Asset Model, or S2FX, uses color-coded dots to analyze Bitcoin price action relative to the date of its next block reward halving.

Dots immediately after halving, like at present, are in red and historically precede a jump in Bitcoin’s price, which PlanB often refers to as being higher by “an order of magnitude.”

Reflected in the model, the next order of magnitude shift is imminent — it should start before the end of 2020. Between then and the next halving in 2024, the model focuses on a price of $288,000 for BTC/USD, with the potential for much higher peaks.

“#Bitcoin S2F chart update .. RED DOT #2,” PlanB summarized on Twitter, referring to June and July’s markings on the chart.

Stock-to-flow remains a steadfast bullish take on long-term Bitcoin price action, despite fielding considerable criticism this year. 

PlanB maintains that those critics have yet to produce a viable alternative to his model, which has traditionally tracked price behavior extremely accurately. 

Bitcoin S2FX price model as of July 1. Source: PlanB/ Twitter

“Typical” month could spark $12,000 BTC price 

Analyzing monthly returns during the last halving period from 2016 to 2020, PlanB highlighted the “very asymmetrical” nature of Bitcoin price performance. 

As such, for BTC/USD to leave its current stagnant levels at around $9,000 and hit $12,000, all that is needed is a “typical” month of solid 30% gains.

Bitcoin monthly returns during the last halving period. Source: PlanB/Twitter

Nonetheless, Bitcoin’s considerable correlation to the S&P 500 forms a focus for macro factors dictating likely resistance to even $10,000. 

Against a backdrop of pressure on stock markets, analysts broadly expect that BTC/USD will continue to act in line with macro swings — no matter how intense these become.

Tone Vays, for example, has stated he does not believe that the pair will go above $10,000 until 2021.

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The Best And Worst Performing Assets In June, Q2 And 2020 YTD

The Best And Worst Performing Assets In June, Q2 And 2020 YTD

Tyler Durden

Wed, 07/01/2020 – 15:07

Citi had a lovely recap of what happened in the second quarter, which as we noted yesterday, was the strongest for stocks since 1998 thanks to trillions in global central bank liquidity injections, even as the global economy collapsed.

Citi also commented on what comes next, saying that “our US equity strategists characterize the sentiment as euphoric with more than 80% probability of negative returns in the next 12 months. In our view, everything has to go right for equity markets to be right.”

But while the disconnect between risk assets and underlying fundamentals has never been greater as even major banks admit, here is a recap of what worked in June, in Q2 and 2020 YTD courtesy of Deutsche Bank’s Jim Reid, who writes that “June saw another strong  performance for risk assets, capping off an astonishing quarter that has seen all 38/38” of DB’s non-currency assets with a positive return over the last three months.

While that comes on the back of an appalling Q1 when financial markets reacted to the coronavirus pandemic, the gains from Q2 now mean that 13/38 of DB’s non-currency assets are now positive on a YTD basis as well in local currency terms. Much of these gains have come about thanks to slowing rates of case growth and moves to reopen major economies, as well as remarkable levels of stimulus from governments and central banks across the world. However, in the last couple of weeks there’ve been signs once again of an acceleration in case growth in some countries, including the United States, raising fears for where things might be headed in the second half.

Reid starts with oil, which has seen the biggest swings this year of all the assets and even tumbled in negative territory at one point in April. Looking at the quarter as a whole, WTI and Brent are top of the leaderboard, with returns of +91.7% and +81.0% respectively, making it the strongest performance for both since Q3 1990 when the Gulf War broke out.

Nevertheless, it’s worth noting that in spite of their best quarterly performance in almost 3 decades, both WTI and Brent are still at the bottom of DB’s league table on a YTD basis thanks to their falls in Q1, and are down YTD by -35.7% and -37.7% respectively.

Staying on commodities, gold continues to be the top performer on a YTD basis, with a +17.4% advance in the first half of the year. That comes on the back of another positive performance in June, with a +2.9% return, that saw prices end the month at a 7-year high. Other commodities have also performed strongly, with copper up +11.9% this month, in its own best monthly performance since November 2016. And on a quarterly basis, its +21.8% return is the best since Q3 2010.

Moving on, it was a strong quarter for equities on the whole as they recovered their losses from Q1. In fact, on a total returns basis, the S&P 500 just had its best quarter since Q4 1998, thanks to a +20.5% advance. However, even this strong performance still leaves the index down -3.1% on a YTD basis. Meanwhile, the only index in DB’s core sample that is actually positive on a YTD basis so far is the NASDAQ, which extended its YTD gains in June, and now has a +12.7% return since the start of the year.

Looking at FX, it was a bad month for the US dollar, with the dollar index falling by -1.0% in its 3rd consecutive monthly decline. On the other hand, the Euro had a strong month, gaining +1.2% against both the US Dollar in June as the continent has proven more successful at suppressing the virus than the US, which has recently seen an outbreak of new cases in many states.

Finally on the fixed income side, sovereign bonds underperformed equity indices for the most part in June. US Treasuries were up by just +0.1%, with bunds also up +0.3%. Nevertheless, they remain among the strongest performers on a YTD basis with gilts (+9.7%), Treasuries (+9.2%) and bunds (+2.3%) all in positive territory since the start of the year.

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Seeing The Big Picture…

Seeing The Big Picture…

Tyler Durden

Wed, 07/01/2020 – 14:45

Authored by Sven Henrich via NorthmanTrader.com,

Onto the dog days of summer. The first half of 2020 has been intense for all involved and the second half looks to be intense as well. Stepping back from the daily noise of headlines it may serve useful to look at the big picture.

For now there is little doubt that the unprecedented interventions by the Fed continue to support equity markets on their journey toward the largest asset bubble inside of a recession ever. Indeed all market down move events in June found the Fed immediately responding with announcements, from corporate bond buying, to loosening the Volcker rule, and announcing its corporate credit facility to be operational this week. All of these actions produced rallies in markets following downside moves. It remains my view that the Fed has created another asset bubble following the bubble they created with their repo operations in the Fall of 2019.

Reminder: It was the Fed’s balance sheet expansion in Q4 2019 into Q1 2020 that led to the largest market cap to GDP expansion on record: 158% in February before markets collapsed triggered by the Covid crisis.

Now, following even more aggressive and historic interventions, market cap to GDP remains far beyond any levels we’ve ever seen during a recession, never mind the worst recession in our life times:

And yes you have the Fed’s unprecedented and historically absurd interventions to thank for that:

What’s it all mean?

Firstly, let’s start with some basic history here and this history shows that the signals that were ignored in 2019, namely the yield curve inversion as well as the declining participation of equal weight, indeed foresaw a recession coming. Equal weight meaning the broader market lagged versus select leaders that concentrated market cap amongst each other, basically repeating the same patterns we’ve seen during the previous boom/bust cycles:

In this sense markets virtually repeated the pattern we saw in 2006 leading to the 2007 top and then recession and collapse.

It was the Fed’s repo action disconnecting asset prices from the underlying pinnings of the economy that led me to issue a 1999 like warning late in 2019 and early in 2020 (Party like it’s 1999Ghosts of 2000).

Covid may have been the trigger but the underpinning were there and, like in 2000, markets peaked in Q1 followed by a crash. And now the big recovery rally in Q2 on the heels of Fed intervention which was also advertised in 1929 Redux.

I see no bears on Wall Street and the faith in the Fed is unfalsifiable, never mind that we remain at historic entirely incompatible valuations. To believe in new highs or higher prices is to again believe that markets can sustain a market cap to GDP ratio north of 150% when so far all of market history says otherwise.

I can’t say whether a new record market cap to GDP extension will happen or not, but from a historic perspective the risk/reward ratio says otherwise. Indeed it was in June when market again broached the 150% market cap to GDP ratio mark on June 8th and failed producing sizable down moves in markets, including 7% down on $SPX, 10% down in small caps and 20% down in banks.

The divergence in markets now is the largest we’ve ever seen. Equal weight as shown in the chart above is below the 2018 lows when $SPX was trading at 2350 and barely above the 2016 lows when $SPX was trading at 2000-2100.

Make no mistake: All is driven by tech and has been since the January 2018 highs:

Without its dominating tech components even $SPX would be down for the count.

Indeed reality is this:

The broader markets hasn’t gone anywhere in 2.5 years, but experienced a Fed induced blow-off top in February and now has again reached levels of resistance in June and has struggled with them.j some bull market. Requires trillions in tax cuts, Fed intervention and zero rates to go nowhere. Congrats.

So the Fed has managed to produced the most aggressive counter rally in decades but it also took unprecedented actions which are unlikely to be repeated again unless the Fed goes towards negative rates.

It is in context of this incredible market range chop that perhaps history can offer some guidance.

Here’s the $DJIA during the period of 1999-2002:

$DJIA peaked in early 2000 while Nasdaq ran higher into March, then it was a massive counter rally to lower highs followed by more chop and rallies into September of 2000. Then more chop and new lows as the recession continued to persist and the excess was wrought out of tech. A repeat of this pattern would suggest significant more corrections and rallies to come into the rest of the year with even new lows not being beyond the realm of possibility.

I submit with a market cap to GDP ratio again near 150% we haven’t wrought out any excess, which just transferred it into a few tech companies and we do have lower highs on most indices save tech  in context of massive range chop:

While hope and optimism headlines continue to dominate the day to day action be very clear: Companies are downsizing, lay off announcements are daily headlines, and hiring freezes remain. Yes companies are bringing furloughed workers back, but the US is far from a clean reopening as Covid is still spiking higher in many states. If there was a V in the offing we would see it in the banks and yields.

We don’t:

Hence I submit to you: We are in a period of great uncertainty and the notion that the global economy goes back to the same size and state as it was in February is a fantasy. Incremental improvement from disastrous conditions yes, but an all clear and all back to normal? Far from it.

Rather what the big picture says is that the structural charts which predicted this recession via the yield curve, negative divergences and weakening participation were absolutely on the money. And they are sending a clear message: This is not over, there is no sudden quick V, and if that is so, then there will be more challenges coming to the Fed’s asset price inflation operation.

Like in 2000 we’ve already been in a period of vast price ranges and chop. As stated before the broader market has not gone anywhere for 2.5 years despite the continues shouting of buy buy buy.

Rather it remains a tradable market. The base reality here is this: As long as the Fed remains in control corrections will be contained on some levels. June demonstrated the Fed has little pain tolerance and they step in during every sell off. So far I suppose it’s working as $SPX managed to defend key support in June stands above the quarterly 5 EMA:

The question of diminishing returns remains and the danger for bulls, who are keen to apparently buy the highest valuations inside a recession ever, is whether the Fed loses control. For if the Fed does lose control history says markets have an appointment with a 100% market cap GDP ratio or below and if that happens the Fed will have no choice but to go with negative rates and ask Congress to be allowed to buy stocks directly. As many red lines have already been crossed, including the Fed buying $AAPL bonds, buying stocks directly is only the last red line to cross. While the Fed pretends to be concerned about moral hazard its actions clearly say otherwise.

From my perch here: Big rallies into key levels offer opportunities to sell markets, dips into key levels of confluence support offer select long trading opportunities. Like in 2000 the winners are not the stubborn ones, but the ones that navigate the wide price range chop in both directions. I suppose this is another way of saying: Buy the dips and sell the rips while maintaining a healthy sense of skepticism and utmost flexibility for that’s what seeing big picture is telling us and it has yet to lead us astray.

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Nasdaq Extends Gains As AAPL Shutters More Stores, CA Closes Restaurants

Nasdaq Extends Gains As AAPL Shutters More Stores, CA Closes Restaurants

Tyler Durden

Wed, 07/01/2020 – 14:33

Update (1440ET): Did the adults just come back into the room?

*  *  *

Nothing says buy big-tech stocks like 33 more Apple store closures and CA Governor Gavin Newsom shutting down LA Country restaurants for three weeks

But hey that’s the “market” we live in.

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As Delayed Tax Day Approaches, Consider What You Get for Your Money

cewitness042325(1)

Flattening the curve on COVID-19 has meant flattening the curve on tax season, too, pushing everything down the line a bit so that the final day to hand over the government’s cut of our hard-earned income comes up on July 15. That’s given us an unparalleled opportunity in a time of crisis to assess what we’re getting for our money. Amidst the smoking ruins of 2020, it’s understandable if you regret every penny you’ve ever surrendered to a tax collector.

The year 2020 should stand forever as evidence that, rather than a solution, government is often a cup of gasoline just waiting to be thrown on a fire. The spark this time was a tiny, but deadly, virus.

From the beginning, President Trump minimized the danger posed by COVID-19 even as the Centers for Disease Control and Prevention (CDC) and the Food and Drug Administration (FDA)—agencies of the federal government over which he presides—fumbled developing a test for the disease and kneecapped academic, commercial, and hospital efforts that could do better. The FDA only belatedly eased rules standing in the way of expanding the supply of ventilators, masks, hand sanitizer, and other supplies.

When companies found it challenging to navigate the ever-shifting regulatory landscape, the president invoked the Defense Production Act to force them to produce what the government wanted, when it was wanted.

To add to the fun, the CDC kept Americans entertained with contradictory advice as to whether or not wearing masks could be helpful.

Taking the chaos in D.C. as a challenge to their own abilities at confusing and dismaying the public, state governors feuded with the Trump administration as well as with local officials who were busy baffling us with their own efforts.

Perhaps the CDC’s test-fumbling was seen as insufficiently deadly; governors of some states, including New Jersey and New York, required nursing homes to accept COVID-19 patients against all advice. Such facilities have accounted for about 40 percent of all U.S. deaths during the pandemic.

In the name of delaying the spread of COVID-19, states and localities issued draconian and arbitrary shutdown rules that closed businesses, choked-off travel, interrupted personal relationships, and threatened many people with economic ruin and despair. To make it worse, some of the governors issuing them promptly ignored or gamed their own rules.

That this has been to questionable benefit should go without saying—we’re seeing a new round of mandated closures now, after Americans’ patience and limited ability to weather orders that shut businesses and kill jobs is greatly eroded. In fact, by the end of May, Americans were unemployed, aggravated, at wit’s end and ready to explode.

Despite spending years fueling conflict between police and the public, and then confining the population to stew at home over health concerns and the prospect of unpaid bills and poverty, officials seemed astonished that the country erupted in anger at the latest law-enforcement outrage.

“Police abuse remains a problem that needs to be addressed by policymakers and police professionals,” the federal government’s National Institute of Justice warned in 2000.

Twenty years later, with little done to address the issue and lots of time and frustration on their hands, Americans marched, protested, and some also rioted. The killing of George Floyd, mistreatment of African-Americans, and anger at police brutality in general, sent people into the streets to demand change—in forms good, bad, indifferent, and undefined.

How that change will shake out is anybody’s guess; as with the pandemic, Republicans and Democrats have turned dealing with police reform and racism into new excuses for political point-scoring. Will officials back enforcers to the hilt, go with tearing down random statues misunderstood by the mob, or make the difficult effort to rein-in their own out-of-control enforcers? Hang on while political professionals wet their fingers and hold them in the air.

What is clear is that this turmoil has a big price tag, which will probably generate more turmoil. As of June 26, the Federal Reserve Bank of Atlanta projects a 39.5 percent decline in GDP for the second quarter.

For the year overall, the Federal Reserve Bank’s projection of a 6.5 percent decline in GDP is actually optimistic compared to the roughly 8 percent drops predicted by the International Monetary Fund (IMF) and the Organization for Economic Cooperation and Development (OECD).

“The COVID-19 pandemic pushed economies into a Great Lockdown, which helped contain the virus and save lives, but also triggered the worst recession since the Great Depression,” writes Gita Gopinath, director of the IMF’s research department.

The U.S. government tried to offset the economic fallout of the pandemic and of the lockdown orders, but it did so very badly. Of the money paid out to alleviate the pain, $1.4 billion went to dead people who are already well beyond the reach of stimulus efforts, according to the U.S. Government Accountability Office.

The checks that went to living recipients didn’t do much more good.

“Stimulus checks increase spending particularly among low-income households, but very little of the additional spending flows to the businesses most affected by the COVID shock; and loans to small businesses have little impact on employment rates,” concludes a paper from a Harvard University economic research team published earlier this month.

For all of this, we’ll be paying over the course of many years to come.

The Congressional Budget Office “projects that over the 11-year horizon, cumulative real output (in 2019 dollars) will be $7.9 trillion, or 3.0 percent of cumulative real GDP, less than what the agency projected in January.” That is, America over the next decade is expected to be a poorer place than it was on track to be. That’s not entirely because of matters under human control—COVID-19 is a creation of nature—but human government officials played an enormous role in creating the conditions in which we find ourselves.

So we’re getting quite a lot for our money. Whether all of that incompetence, in-fighting, obstructionism, authoritarianism, and waste is worth what we’re paying is a matter for each of us to decide. We’ll have time to contemplate the return on our investment as we await the arrival of this year’s tax day, and to consider if we’re happy with what we’re getting for our money.

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Justice Kagan on Hamilton in Federalist No. 77

There is much to admire in Justice Kagan’s Seila Law dissent. She wrote a robust historical analysis about the removal power. And, to be frank, Chief Justice Roberts didn’t bother responding to most of her claims. But there is at least one weak spot in Kagan’s analysis: she misread Hamilton in Federalist No. 77. To Kagan, Hamilton thought the Constitution required Senatorial consent for a Presidential removal. Kagan’s reading is all-too-common. Indeed, in Myers v. United States, both Chief Justice Taft and Justice Brandeis accepted this understanding of Federalist No. 77

This reading, however, is not the best reading of Federalist No. 77. In that paper, Hamilton was discussing the appointment power, not the removal power. He stated what should be an uncontroversial point: when a new President wants to “displace”–that is replace or substitute–a holdover appointed by his predecessor, the Senate must provide “advice and consent” for the new position. Hamilton was not discussing whether the Senate must consent before the President removes an officer of the United States. He was talking about what happens after the removal: the Senate must provide advice-and-consent to fill the vacancy.

In Federalist No. 77, Hamilton begins by praising the “stability” of the new government when one administration concludes and a new administration begins:

IT HAS been mentioned as one of the advantages to be expected from the co-operation of the Senate, in the business of appointments, that it would contribute to the stability of the administration. The consent of that body would be necessary to displace as well as to appoint. A change of the Chief Magistrate, therefore, would not occasion so violent or so general a revolution in the officers of the government as might be expected, if he were the sole disposer of offices.

Let’s consider an example. When President Washington’s term concludes, and President Adams’s term begins, President Adams would need the Senate’s consent to “displace as well as to appoint.” That is, Adams would need the Senate’s consent to “appoint” people to fill vacant positions. That conclusion is not controversial. And Adams would need the Senate’s consent to “displace” some holdovers from the Washington administration. What does it mean to “displace”?

That displacement process can take one of two forms. First, Adams could ask the holdover to resign, which he probably would. If so, the position is now vacant, and the President could seek advice-and-consent to fill it. Second, if the holdovers refuses to resign, Adams could remove the holdover. At that point, now the position is vacant, and the President could seek advice-and-consent to fill it. In short, the Senate’s role in “displace[ment]” does not concern asking an Officer to resign, or removing an Officer. Rather, the Senate’s role arises on the back-half of this process: replacing, or substituting a new person for that position.

In Federalist No. 77, Hamilton was not discussing the President’s removal power; he was trying to sell the Constitution to the people of New York, who were worried about a new executive who will create chaos.  Hamilton makes this point expressly in the next two sentences of Federalist No. 77:

Where a man in any station had given satisfactory evidence of his fitness for it, a new President would be restrained from attempting a change in favor of a person more agreeable to him, by the apprehension that a discountenance of the Senate might frustrate the attempt, and bring some degree of discredit upon himself. Those who can best estimate the value of a steady administration, will be most disposed to prize a provision which connects the official existence of public men with the approbation or disapprobation of that body which, from the greater permanency of its own composition, will in all probability be less subject to inconstancy than any other member of the government.

Hamilton was discussing a simple proposition: a new President could not unilaterally appoint new members to the executive branch; he would need the Senate’s consent. Thus, the Senate wold ensure there was some be “stability” from administration to administration, rather than a “violent or so general a revolution.” Senate advice-and-consent on the appointment power maintains stability. In other words, the President could not simply fire everyone as a means to appoint new people. If he chooses to fire people, without an eye to the Senate, he would be stuck with vacancies in critical positions, thereby undermining his own administration. Hamilton was prescient: the parallels to present circumstances should be apparent.

At one point in her opinion, Justice Kagan seems to understand the phrase “displace” to mean replace, or substitute. Indeed, she uses the phrase “substituting.”

Delegates to the Constitutional Convention never discussed whether or to what extent the President would have power to remove executive officials. As a result, the Framers advocating ratification had no single view of the matter. In Federalist No. 77, Hamilton presumed that under the new Constitution “[t]he consent of [the Senate] would be necessary to displace as well as to appoint” officers of the United States. Id., at 515. He thought that scheme would promote”steady administration”: “Where a man in any station had given satisfactory evidence of his fitness for it, a new president would be restrained” from substituting “a person more agreeable to him.” Ibid.

Again, Hamilton wrote, “Where a man in any station had given satisfactory evidence of his fitness for it, a new President would be restrained from attempting a change in favor of a person more agreeable to him…” Kagan changed “from attempting a change in favor of” to “from substituting.” Here Kagan, perhaps inadvertently, nailed it. But she still drew the same conclusion Taft and Brandeis drew: that “displace” was synonymous with “remove.” The better conclusion is that “displace” means “substitute,” which is a multi-step process.

This reading also accounts for Hamilton’s general reading of a robust, “vigorous” executive. In Myers, Chief Justice Taft wrote that Hamilton “changed his view of this matter” with respect to Washington’s proclamation of neutrality. Hamilton didn’t change his mind, or state a “heterodox” position in Federalist No. 77. He simply used the word “displace” in a different fashion.

Seth Barrett Tillman wrote about this issue a decade ago in a paper, fittingly titled, “The Puzzle of Hamilton’s Federalist No. 77.” Once again, Seth shined a light on constitutional puzzles that few others saw. I am always grateful for his careful and prescient scholarship.

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Police Departments Asked Live PD To Cut Footage That Made Cops Look Bad

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After A&E canceled the police ride-along reality show Live PD in response to growing criticism and activism about how police officers treat black people, host Dan Abrams insisted that part of the purpose of the show is to provide additional transparency into how officers operate in the field. Abrams said that he thought the show actually furthered the cause of police accountability.

But a new investigation by The Marshall Project, in partnership with The Daily Beast, raises questions about the influence of the police departments with whom the show partnered.

The Marshall Project sought out records and emails between the 47 law enforcement agencies that worked with Live PD and the show’s production company. From the 20 agencies who responded to their records requests, they found documentation that police officers reviewed footage before it aired and that, in 13 cases, police asked Live PD to not broadcast specific encounters.

Not all of Live PD was aired live. The show frequently followed police and recorded footage to be aired for future episodes. And even for the footage aired “live,” there was actually a 10- to 25-minute delay so that the footage could be reviewed. The show said it only edited footage to remove private information or censor footage that could jeopardize a case or cause a security risk.

But The Marshall Project found that law enforcement agencies asked that footage be cut for other reasons. In one such case, police in Warwick, Rhode Island, confronted a man on a skateboard with a shopping cart who was suspected of shoplifting. As a police car chased the man on a skateboard, it appeared (though it’s not fully clear) that the officer driving the car opened the door to knock the skater down while the vehicle was moving.

This is a pretty dangerous tactic for catching a shoplifter and could have hurt the man. A captain with the police department wrote to Live PD and told them that the method used to catch the shoplifter was “way outside of [their] policy and [they] would be opening up some scrutiny issues with the city and our insurance company if they were to see this.” He said that the incident was “too ‘wild west'” for how they typically behave in the department. Following that email, the incident never aired on Live PD.

The investigation also found footage of a sheriff’s deputy in Spokane, Washington, forcefully removing a woman from her own home after she apparently called them over a domestic violence incident. The woman told officers they had to get a search warrant in order to enter her home and then tried to close the door. Instead of leaving, or waiting peacefully outside the home, the officers dragged the woman out of her house while waiting for a judge to sign a warrant.

Once again, representatives from the sheriff’s department asked Live PD not to air the encounter due to “procedural issues” with how the deputies behaved. The show’s producers tried to edit the footage, but the department was still not satisfied. The encounter never aired.

Big Fish Entertainment, which produced Live PD, told The Marshall Project that the incident didn’t air because they were concerned about the woman and a child in the home being identified, not because of the sheriff’s department request. In fact, in each incident they were asked about, the production company had a different reason for censoring or cutting footage, and told The Marshall Project that it was not due to police concerns.

The Marshall Project obtained the footage of these encounters and have embedded the videos in its story, so you can review for yourself whether this behavior looks like police misconduct.

These incidents where police departments attempted to influence what Live PD put on the show is precisely why I cast doubt on claims that this type of programming actually shines a light on how police treat people. Real transparency means letting the public witness police mistakes.

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Wesley Yang: Woke Protests Against ‘White Supremacism’ May Be the New Normal

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Wesley Yang is the author of the widely praised essay collection The Souls of Yellow Folk and proprietor of one of the liveliest Twitter feeds around. In a wide-ranging conversation with Nick Gillespie, he discusses the cultural impacts of the coronavirus lockdown and protests in the wake of the police killing of George Floyd; racism against black people, Latinos, Asians, and white ethnic people in American history; and how a totalizing and misguided attack on “white supremacism” came to replace a focus on ending specific racist policies and attitudes in recent years. “Wokeness” and “anti-racism” are forming a new elite consensus, Yang says, that may well undermine traditional American beliefs in a prosperous, innovative, and better future.

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As Delayed Tax Day Approaches, Consider What You Get for Your Money

cewitness042325(1)

Flattening the curve on COVID-19 has meant flattening the curve on tax season, too, pushing everything down the line a bit so that the final day to hand over the government’s cut of our hard-earned income comes up on July 15. That’s given us an unparalleled opportunity in a time of crisis to assess what we’re getting for our money. Amidst the smoking ruins of 2020, it’s understandable if you regret every penny you’ve ever surrendered to a tax collector.

The year 2020 should stand forever as evidence that, rather than a solution, government is often a cup of gasoline just waiting to be thrown on a fire. The spark this time was a tiny, but deadly, virus.

From the beginning, President Trump minimized the danger posed by COVID-19 even as the Centers for Disease Control and Prevention (CDC) and the Food and Drug Administration (FDA)—agencies of the federal government over which he presides—fumbled developing a test for the disease and kneecapped academic, commercial, and hospital efforts that could do better. The FDA only belatedly eased rules standing in the way of expanding the supply of ventilators, masks, hand sanitizer, and other supplies.

When companies found it challenging to navigate the ever-shifting regulatory landscape, the president invoked the Defense Production Act to force them to produce what the government wanted, when it was wanted.

To add to the fun, the CDC kept Americans entertained with contradictory advice as to whether or not wearing masks could be helpful.

Taking the chaos in D.C. as a challenge to their own abilities at confusing and dismaying the public, state governors feuded with the Trump administration as well as with local officials who were busy baffling us with their own efforts.

Perhaps the CDC’s test-fumbling was seen as insufficiently deadly; governors of some states, including New Jersey and New York, required nursing homes to accept COVID-19 patients against all advice. Such facilities have accounted for about 40 percent of all U.S. deaths during the pandemic.

In the name of delaying the spread of COVID-19, states and localities issued draconian and arbitrary shutdown rules that closed businesses, choked-off travel, interrupted personal relationships, and threatened many people with economic ruin and despair. To make it worse, some of the governors issuing them promptly ignored or gamed their own rules.

That this has been to questionable benefit should go without saying—we’re seeing a new round of mandated closures now, after Americans’ patience and limited ability to weather orders that shut businesses and kill jobs is greatly eroded. In fact, by the end of May, Americans were unemployed, aggravated, at wit’s end and ready to explode.

Despite spending years fueling conflict between police and the public, and then confining the population to stew at home over health concerns and the prospect of unpaid bills and poverty, officials seemed astonished that the country erupted in anger at the latest law-enforcement outrage.

“Police abuse remains a problem that needs to be addressed by policymakers and police professionals,” the federal government’s National Institute of Justice warned in 2000.

Twenty years later, with little done to address the issue and lots of time and frustration on their hands, Americans marched, protested, and some also rioted. The killing of George Floyd, mistreatment of African-Americans, and anger at police brutality in general, sent people into the streets to demand change—in forms good, bad, indifferent, and undefined.

How that change will shake out is anybody’s guess; as with the pandemic, Republicans and Democrats have turned dealing with police reform and racism into new excuses for political point-scoring. Will officials back enforcers to the hilt, go with tearing down random statues misunderstood by the mob, or make the difficult effort to rein-in their own out-of-control enforcers? Hang on while political professionals wet their fingers and hold them in the air.

What is clear is that this turmoil has a big price tag, which will probably generate more turmoil. As of June 26, the Federal Reserve Bank of Atlanta projects a 39.5 percent decline in GDP for the second quarter.

For the year overall, the Federal Reserve Bank’s projection of a 6.5 percent decline in GDP is actually optimistic compared to the roughly 8 percent drops predicted by the International Monetary Fund (IMF) and the Organization for Economic Cooperation and Development (OECD).

“The COVID-19 pandemic pushed economies into a Great Lockdown, which helped contain the virus and save lives, but also triggered the worst recession since the Great Depression,” writes Gita Gopinath, director of the IMF’s research department.

The U.S. government tried to offset the economic fallout of the pandemic and of the lockdown orders, but it did so very badly. Of the money paid out to alleviate the pain, $1.4 billion went to dead people who are already well beyond the reach of stimulus efforts, according to the U.S. Government Accountability Office.

The checks that went to living recipients didn’t do much more good.

“Stimulus checks increase spending particularly among low-income households, but very little of the additional spending flows to the businesses most affected by the COVID shock; and loans to small businesses have little impact on employment rates,” concludes a paper from a Harvard University economic research team published earlier this month.

For all of this, we’ll be paying over the course of many years to come.

The Congressional Budget Office “projects that over the 11-year horizon, cumulative real output (in 2019 dollars) will be $7.9 trillion, or 3.0 percent of cumulative real GDP, less than what the agency projected in January.” That is, America over the next decade is expected to be a poorer place than it was on track to be. That’s not entirely because of matters under human control—COVID-19 is a creation of nature—but human government officials played an enormous role in creating the conditions in which we find ourselves.

So we’re getting quite a lot for our money. Whether all of that incompetence, in-fighting, obstructionism, authoritarianism, and waste is worth what we’re paying is a matter for each of us to decide. We’ll have time to contemplate the return on our investment as we await the arrival of this year’s tax day, and to consider if we’re happy with what we’re getting for our money.

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Justice Kagan on Hamilton in Federalist No. 77

There is much to admire in Justice Kagan’s Seila Law dissent. She wrote a robust historical analysis about the removal power. And, to be frank, Chief Justice Roberts didn’t bother responding to most of her claims. But there is at least one weak spot in Kagan’s analysis: she misread Hamilton in Federalist No. 77. To Kagan, Hamilton thought the Constitution required Senatorial consent for a Presidential removal. Kagan’s reading is all-too-common. Indeed, in Myers v. United States, both Chief Justice Taft and Justice Brandeis accepted this understanding of Federalist No. 77

This reading, however, is not the best reading of Federalist No. 77. In that paper, Hamilton was discussing the appointment power, not the removal power. He stated what should be an uncontroversial point: when a new President wants to “displace”–that is replace or substitute–a holdover appointed by his predecessor, the Senate must provide “advice and consent” for the new position. Hamilton was not discussing whether the Senate must consent before the President removes an officer of the United States. He was talking about what happens after the removal: the Senate must provide advice-and-consent to fill the vacancy.

In Federalist No. 77, Hamilton begins by praising the “stability” of the new government when one administration concludes and a new administration begins:

IT HAS been mentioned as one of the advantages to be expected from the co-operation of the Senate, in the business of appointments, that it would contribute to the stability of the administration. The consent of that body would be necessary to displace as well as to appoint. A change of the Chief Magistrate, therefore, would not occasion so violent or so general a revolution in the officers of the government as might be expected, if he were the sole disposer of offices.

Let’s consider an example. When President Washington’s term concludes, and President Adams’s term begins, President Adams would need the Senate’s consent to “displace as well as to appoint.” That is, Adams would need the Senate’s consent to “appoint” people to fill vacant positions. That conclusion is not controversial. And Adams would need the Senate’s consent to “displace” some holdovers from the Washington administration. What does it mean to “displace”?

That displacement process can take one of two forms. First, Adams could ask the holdover to resign, which he probably would. If so, the position is now vacant, and the President could seek advice-and-consent to fill it. Second, if the holdovers refuses to resign, Adams could remove the holdover. At that point, now the position is vacant, and the President could seek advice-and-consent to fill it. In short, the Senate’s role in “displace[ment]” does not concern asking an Officer to resign, or removing an Officer. Rather, the Senate’s role arises on the back-half of this process: replacing, or substituting a new person for that position.

In Federalist No. 77, Hamilton was not discussing the President’s removal power; he was trying to sell the Constitution to the people of New York, who were worried about a new executive who will create chaos.  Hamilton makes this point expressly in the next two sentences of Federalist No. 77:

Where a man in any station had given satisfactory evidence of his fitness for it, a new President would be restrained from attempting a change in favor of a person more agreeable to him, by the apprehension that a discountenance of the Senate might frustrate the attempt, and bring some degree of discredit upon himself. Those who can best estimate the value of a steady administration, will be most disposed to prize a provision which connects the official existence of public men with the approbation or disapprobation of that body which, from the greater permanency of its own composition, will in all probability be less subject to inconstancy than any other member of the government.

Hamilton was discussing a simple proposition: a new President could not unilaterally appoint new members to the executive branch; he would need the Senate’s consent. Thus, the Senate wold ensure there was some be “stability” from administration to administration, rather than a “violent or so general a revolution.” Senate advice-and-consent on the appointment power maintains stability. In other words, the President could not simply fire everyone as a means to appoint new people. If he chooses to fire people, without an eye to the Senate, he would be stuck with vacancies in critical positions, thereby undermining his own administration. Hamilton was prescient: the parallels to present circumstances should be apparent.

At one point in her opinion, Justice Kagan seems to understand the phrase “displace” to mean replace, or substitute. Indeed, she uses the phrase “substituting.”

Delegates to the Constitutional Convention never discussed whether or to what extent the President would have power to remove executive officials. As a result, the Framers advocating ratification had no single view of the matter. In Federalist No. 77, Hamilton presumed that under the new Constitution “[t]he consent of [the Senate] would be necessary to displace as well as to appoint” officers of the United States. Id., at 515. He thought that scheme would promote”steady administration”: “Where a man in any station had given satisfactory evidence of his fitness for it, a new president would be restrained” from substituting “a person more agreeable to him.” Ibid.

Again, Hamilton wrote, “Where a man in any station had given satisfactory evidence of his fitness for it, a new President would be restrained from attempting a change in favor of a person more agreeable to him…” Kagan changed “from attempting a change in favor of” to “from substituting.” Here Kagan, perhaps inadvertently, nailed it. But she still drew the same conclusion Taft and Brandeis drew: that “displace” was synonymous with “remove.” The better conclusion is that “displace” means “substitute,” which is a multi-step process.

This reading also accounts for Hamilton’s general reading of a robust, “vigorous” executive. In Myers, Chief Justice Taft wrote that Hamilton “changed his view of this matter” with respect to Washington’s proclamation of neutrality. Hamilton didn’t change his mind, or state a “heterodox” position in Federalist No. 77. He simply used the word “displace” in a different fashion.

Seth Barrett Tillman wrote about this issue a decade ago in a paper, fittingly titled, “The Puzzle of Hamilton’s Federalist No. 77.” Once again, Seth shined a light on constitutional puzzles that few others saw. I am always grateful for his careful and prescient scholarship.

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