Plexiglass Barriers Are Everywhere, but They’re Probably Useless


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Eateries have adapted to COVID in countless ways. Hostesses take our temperatures upon entry. We scan QR codes instead of reading paper menus. We are served by masked waiters. In some cities, unsightly plexiglass barriers have appeared between tables and bar seats.

Restaurants should be given broad latitude to adapt how they see fit, to best protect their workers and return a degree of confidence to their customers. But some of these adaptations verge on hygiene theater. When those plexiglass barriers are used in classrooms, they “might be making things worse by blocking ventilation,” to quote Zeynep Tufekci, who then points to a new study in Science.

For a virus that spreads via airborne transmission of aerosols—something scientists have known for many months, though it took the World Health Organization until the end of April to update its guidance—these plastic barriers between diners were always a confusing addition. Think of the particles that disperse through the air when someone smokes a cigarette. A plastic barrier wouldn’t prevent you from smelling that cigarette and breathing some of that same air.

It would be one thing if this form of hygiene theater was limited to restaurants. But school districts across the country have forced children to try to learn while encased in plexiglass desk dividers—that is, if they’ve allowed kids to return to full-time in-person schooling at all.

Not only does this make it harder for children to connect with their friends and teachers, but forcing them to learn this way may lead them to speak up louder to be heard—an act that increases aerosol production and is more likely to spread COVID than speaking at a quieter volume. Given the incredibly low risk of death to children posed by COVID, and the mounting evidence that Plexiglass barriers do not make people safer, it’s past time to remove them; a kindergarten classroom shouldn’t be filled with thick, see-through partitions like a convenience store in a bad part of town.

Some might counter that if they make people feel safer, that ought to be reason enough to keep plexiglass barriers in place. But this is misguided. Hygiene theater gives people a false understanding of how this virus actually works and which preventative measures to take. Pervasive COVID anxiety should not be used to justify silly rituals, especially when there’s good evidence a ritual may hurt us in the end.

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​​​​​​​Russian Spy Ship Quietly Parked In Waters Off Hawaii

​​​​​​​Russian Spy Ship Quietly Parked In Waters Off Hawaii

A Russian Navy surveillance ship parked in international waters off Kauai, an island in the Central Pacific, part of the Hawaiian archipelago, has delayed a Missile Defense Agency missile test, according to Honolulu Star-Advertiser

The US Pacific Fleet confirmed Wednesday that it “is aware of the Russian vessel operating in international waters in the vicinity of Hawaii, and will continue to track it through the duration of its time here.” 

The ship has been operating in international waters just 13 nautical miles west of Kauai for several days. The vessel is not broadcasting an automatic identification system signal. 

“Through maritime patrol aircraft, surface ships and joint capabilities, we can closely monitor all vessels in the Indo-Pacific area of operations,” US Pacific Fleet’s statement continued. 

U.S. Naval Institute News first identified the presence of the spy ship, indicating it was a Russian Navy Vishnya-class auxiliary general intelligence (AGI) ship Kareliya (SSV-535). Honolulu Star-Advertiser then expanded on this and said the vessel is in the vicinity of the Pacific Missile Range and has “delayed” a missile test. 

The question remains: Why does a Russian signals intelligence vessel sit off the coast of Kauai? Is Moscow sending the Biden administration a message of new strength in the Pacific? 

Tyler Durden
Thu, 05/27/2021 – 16:20

via ZeroHedge News https://ift.tt/2Tq4oxJ Tyler Durden

Small Caps Jump, Big-Tech Dumps, As Biden’s Booming Budget Busts Bonds

Small Caps Jump, Big-Tech Dumps, As Biden’s Booming Budget Busts Bonds

Biden’s booming budget sent yields higher on the day – and the retroactive capital gains tax embedded in that budget spooked stocks broadly speaking. But Small Caps refused to lay down as the short-squeeze continued. Nasdaq ended lower on the day…

The Dow and S&P haven’t been this uncorrelated since the dotcom crash in 2000…

Source: Bloomberg

Small Caps are ripping back relative to Nasdaq as the spiky trading continues…

The last two days have been the biggest short-squeeze since the panic-spike in “most shorted” stocks amid the last WSB Reddit Raiders attack in January… And hedgies suffer…

Source: Bloomberg

WSB stocks are soaring again…

Source: Bloomberg

…with AMC (and its massive short position) getting its face gamma-squeeze-ripped off…

AMC was the most-traded stock in the world today!!

VIX crashed to a 16 handle once again…

Bond yields broke higher on the heels of Biden $6 trillion budget bonanza – now that’s a lot of supply to soak up if The Fed is gonna taper. Yields were up around 3bps on the day, but remain lower on the week…

Source: Bloomberg

10Y yields pushed back above 1.60% again…

Source: Bloomberg

Bitcoin oscillated again between $40k and $38k…

Source: Bloomberg

Ethereum is also coiling up for a move…

Source: Bloomberg

The dollar went nowhere on the day, testing higher and lower intraday to end back at unch on the week again…

Source: Bloomberg

Spot Gold fell back below $1900 today, but staged a decent recovery after Europe closed…

Source: Bloomberg

Oil finally broke out of its recent range (top the upside)…

Source: Bloomberg

Finally, the economy is screaming ‘Stagflation’…

Source: Bloomberg

And stocks are loving stagflation? It’s a mad world alright!

Tyler Durden
Thu, 05/27/2021 – 16:00

via ZeroHedge News https://ift.tt/34pyN1u Tyler Durden

Retail Investors Storm Back Into The Market: This Is What They Are Buying

Retail Investors Storm Back Into The Market: This Is What They Are Buying

It was less than than three weeks ago when we first noted that retail participation in stock trading had seemingly collapsed after a wild start to the year, with JPMorgan reporting that US retail investors share in equity trading declined sharply in March after a strong January and February, and a record high share of 28% in December.

And while April and the start of May exhibited a similar continued decline in both retail participation and performance of “retail favorite” stocks, which underperformed the broader market by 8% since mid-March, things have changed dramatically in the past two weeks and as Goldman notes in a new piece discussing the “Recent performance of stocks with high levels of retail activity”, stocks with high retail trading volumes have outperformed by 5% since May 12th, with half of this outperformance occurring yesterday (Wednesday).

Echoing JPMorgan’s observations, Goldman then notes that while declines in daily trades at retail brokers showed significant declines last week (DARTs), leading to fresh concerns that retail trading activity was on the decline – with many going so far as to conclude that retail investors were no longer investing their stimmies – this too appears to have been the wrong conclusion, as the rise in retail stocks yesterday and especially today, when both GME and AMC have soared…

… suggesting it may be too early to call an end to elevated retail activity.

So what are retail investors buying? Based on Goldman’s “small-lot trading” analysis, these are the 50 stocks where retail was the most active yesterday in shares and options.

Not enough? Here are the stocks with high “small lot” trading activity in Options

Tyler Durden
Thu, 05/27/2021 – 15:43

via ZeroHedge News https://ift.tt/3fta3eW Tyler Durden

Joe Biden’s $6 Trillion Budget Proposal Will Hike Spending, Keep Deficits Near Record Highs


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President Joe Biden’s first budget proposal will hike federal spending to new highs and would rely on near-record levels of borrowing even as the economy recovers from the COVID-19 pandemic.

That’s according to The New York Times, which got an early look at some details of Biden’s $6 trillion budget proposal. The White House is set to unveil its official spending plan for the next fiscal year on Friday. The Times reports that Biden’s proposal would result in “the highest sustained levels of federal spending since World War II,” with the budget growing to $8.2 trillion by 2031—the end of the 10-year window that’s typically included in presidential budget-making.

The specific numbers are new, but no one should be surprised by the trajectory. Since taking office in January, Biden has proposed roughly $6 trillion in new government spending (spread out over multiple fiscal years) via his American Recovery Plan, his American Families Plan, and his American Jobs Plan.

Biden has called for hiking taxes on high earners and corporations, though the Times makes it clear that those increases won’t be nearly enough to cover the cost of everything the White House wants to do.

The Times’ Jim Tankersley notes that Biden’s plan would see the federal government spend “what amounts to nearly a quarter of the nation’s total economic output every year over the course of the next decade”—a threshold that has never been hit since World War II, with the exception of 2020 and 2021—while also collecting “tax revenues equal to just under one-fifth of the total economy,” which would also near a record high.

That really sums it up. Record levels of spending that would well exceed even a historically high share of the economy devoted to funding the government.

While Biden’s proposal does not envision budget deficits rising as high as they did last year—when the government spent $3.1 trillion more than it collected in tax revenue—his budget calls for deficits of at least $1.6 trillion for the foreseeable future, the Times reports. The national debt measured as a share of the economy’s overall size will exceed the all-time record high of 113 percent, set during World War II, by 2024. And it will keep growing.

Even without the added worry of the rising deficit, Biden’s proposed increase to the baseline level of annual federal spending is staggering on its own. During 2019, the last full fiscal year before the COVID-19 pandemic, the federal government spent about $4.4 trillion. Biden’s proposal rings in at $1.6 trillion above that.

The current Congressional Budget Office (CBO) baseline envisions just a hair over $5 trillion in spending during the current fiscal year, and it does not see federal spending exceeding $6 trillion until 2027. Biden’s plan takes the country to that level next year.

That same CBO report projected the annual budget deficit to fall to just over $1 trillion by 2024 before rising slightly over the rest of the decade. The passage of the $1.9 trillion American Rescue Plan in March has already nudged those numbers higher, and Biden’s budget makes it clear that the days of mere trillion-dollar deficits are gone.

Like all presidential budgets, Biden’s is mostly aspirational; Congress will have the final say. But with Democratic majorities in both chambers, something similar to the president’s proposal is likely to be adopted.

After Republicans effectively traded away any claim to fiscal responsibility during the Trump administration by backing bigger budgets and higher deficits, Biden rode into office with the chance to spend big with fewer of the usual political impediments. In his joint address to Congress last month, Biden promised to build “a union more perfect, more prosperous, and more just.”

Apparently it will also require more spending, more taxes, and more borrowing.

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Joe Biden’s $6 Trillion Budget Proposal Will Hike Spending, Keep Deficits Near Record Highs


nathan-dumlao-3wqgSSf-op4-unsplash

President Joe Biden’s first budget proposal will hike federal spending to new highs and would rely on near-record levels of borrowing even as the economy recovers from the COVID-19 pandemic.

That’s according to The New York Times, which got an early look at some details of Biden’s $6 trillion budget proposal. The White House is set to unveil its official spending plan for the next fiscal year on Friday. The Times reports that Biden’s proposal would result in “the highest sustained levels of federal spending since World War II,” with the budget growing to $8.2 trillion by 2031—the end of the 10-year window that’s typically included in presidential budget-making.

The specific numbers are new, but no one should be surprised by the trajectory. Since taking office in January, Biden has proposed roughly $6 trillion in new government spending (spread out over multiple fiscal years) via his American Recovery Plan, his American Families Plan, and his American Jobs Plan.

Biden has called for hiking taxes on high earners and corporations, though the Times makes it clear that those increases won’t be nearly enough to cover the cost of everything the White House wants to do.

The Times’ Jim Tankersley notes that Biden’s plan would see the federal government spend “what amounts to nearly a quarter of the nation’s total economic output every year over the course of the next decade”—a threshold that has never been hit since World War II, with the exception of 2020 and 2021—while also collecting “tax revenues equal to just under one-fifth of the total economy,” which would also near a record high.

That really sums it up. Record levels of spending that would well exceed even a historically high share of the economy devoted to funding the government.

While Biden’s proposal does not envision budget deficits rising as high as they did last year—when the government spent $3.1 trillion more than it collected in tax revenue—his budget calls for deficits of at least $1.6 trillion for the foreseeable future, the Times reports. The national debt measured as a share of the economy’s overall size will exceed the all-time record high of 113 percent, set during World War II, by 2024. And it will keep growing.

Even without the added worry of the rising deficit, Biden’s proposed increase to the baseline level of annual federal spending is staggering on its own. During 2019, the last full fiscal year before the COVID-19 pandemic, the federal government spent about $4.4 trillion. Biden’s proposal rings in at $1.6 trillion above that.

The current Congressional Budget Office (CBO) baseline envisions just a hair over $5 trillion in spending during the current fiscal year, and it does not see federal spending exceeding $6 trillion until 2027. Biden’s plan takes the country to that level next year.

That same CBO report projected the annual budget deficit to fall to just over $1 trillion by 2024 before rising slightly over the rest of the decade. The passage of the $1.9 trillion American Rescue Plan in March has already nudged those numbers higher, and Biden’s budget makes it clear that the days of mere trillion-dollar deficits are gone.

Like all presidential budgets, Biden’s is mostly aspirational; Congress will have the final say. But with Democratic majorities in both chambers, something similar to the president’s proposal is likely to be adopted.

After Republicans effectively traded away any claim to fiscal responsibility during the Trump administration by backing bigger budgets and higher deficits, Biden rode into office with the chance to spend big with fewer of the usual political impediments. In his joint address to Congress last month, Biden promised to build “a union more perfect, more prosperous, and more just.”

Apparently it will also require more spending, more taxes, and more borrowing.

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Why Didn’t California’s ‘Red Flag’ Law Stop the San Jose Shooter?


San-Jose-shooting-5-26-21-Newscom

People who worked with the perpetrator of yesterday’s mass shooting in San Jose expressed “generalized concerns about his mental health,” according to Mayor Sam Liccardo. The man’s ex-wife, who had not interacted with him for 13 years, recalled that he was “not mentally stable,” often expressed anger at his bosses and co-workers, and even talked about killing them. His former girlfriend, who accused him of “forc[ing] himself on me sexually” when he was intoxicated, said he had mood swings that were exacerbated by alcohol. A neighbor described him as short-tempered, saying, “I was afraid of him. My wife was scared of him too.”

The shooter apparently set his house on fire before killing nine fellow employees and himself at a San Clara Valley Transportation Authority maintenance facility. He seems like just the sort of person who was supposed to be stymied by a “gun violence restraining order” (GVRO) under California’s expansive “red flag” law, which would have forbidden him to possess firearms or ammunition for up to five years. That law, which was inspired by the 2014 massacre in Isla Vista, was presented as a way of preventing crimes like this.

The fact that the red flag did not stop the San Jose attack, or the other mass shootings that California has seen since the law took effect, highlights the limitations of this crime prevention strategy. The same could be said of California’s other gun controls, which include bans on “assault weapons” and magazines that hold more than 10 rounds, universal background checks and waiting periods for gun buyers, and a virtual ban on public carry. The expectation that such measures will prevent mass shootings shows how the focus on one rare type of violence distorts the debate about gun control.

A few weeks before the San Jose massacre, Assemblymember Phil Ting (D–San Francisco), who wrote a 2020 bill that expanded California’s red flag law, released data showing that a record number of GVROs were issued last year. The annual number of orders rose 15-fold between 2016 and 2020, from 85 to 1,285. All told, more than 3,000 GVROs have been approved since the red flag law took effect at the beginning of 2016.

“I’m glad that Californians have a tool to intervene to save lives and prevent tragedies,” Ting said in a press release. “The COVID-19 restrictions that kept people home may have influenced the rise,” he told the Los Angeles Times, “making them more mindful of the behaviors of others and open to seeking help from law enforcement or the courts directly.” But as the San Jose shooting shows, such mindfulness is not enough, because it is nearly impossible to predict which of the country’s many angry, aggrieved, and troubled residents will commit this sort of crime.

California allows both police and a long list of other potential petitioners to seek GVROs. That list initially included “any spouse, whether by marriage or not, domestic partner, parent, child, any person related by consanguinity or affinity within the second degree, or any other person who regularly resides in the household, or who, within the prior six months, regularly resided in the household.” Ting’s bill, which took effect in September, added employers, co-workers, and school employees to the list.

The idea behind letting so many people file petitions directly, rather than bringing their concerns or complaints to the police, is that it will make it easier to identify and promptly disarm potentially dangerous individuals. The risk of such a broad approach is that it makes it more likely that people will lose their Second Amendment rights due to malicious or erroneous allegations by biased petitioners. But so far in California, both the benefit and the danger have remained mostly theoretical. Ting’s numbers indicate that law enforcement officials obtained more than 95 percent of the GVROs issued in 2020—all but 59. A review of earlier cases found that nearly 97 percent were initiated by a law enforcement officer.

Police can obtain a “temporary emergency gun violence restraining order,” which lasts up to three weeks, by showing there is “reasonable cause” to believe the respondent “poses an immediate and present danger” to himself or others. Other petitioners can obtain an “ex parte gun violence restraining order” of the same duration by showing there is a “substantial likelihood” that the respondent “poses a significant danger, in the near future,” of injuring himself or others with a firearm.

At this stage, respondent is a misnomer, because the orders are issued without giving the target a chance to respond. He is supposed to get that opportunity at a hearing within 21 days of the initial order (although he has no right to legal representation if he can’t afford it). Among other things, the judge is supposed to consider the respondent’s history of threats or violence, his “abuse of controlled substances or alcohol,” and “any other evidence of an increased risk for violence”—factors that presumably would have weighed against the San Jose shooter.

After the hearing, the judge is required to issue a GVRO if he determines there is “clear and convincing evidence” that the respondent “poses a significant danger” of injuring himself or others. That danger need not be imminent, and it is not clear what “significant” means in this context.

The post-hearing GVRO lasts for one to five years and can be extended if a petitioner requests it. Once a year, the respondent can ask that the order be lifted, which is supposed to happen if there is no longer clear and convincing evidence that he poses “a significant danger.”

In theory, then, the San Jose shooter’s employer, his co-workers, or possibly his ex-girlfriend (if she lived with him during the previous six months) could have sought a GVRO against him, which would have made it illegal for him to possess or purchase firearms or ammunition. Assuming he did not obtain guns from an unmonitored source, such an order could have prevented yesterday’s mass shooting.

That did not happen, which is not really very surprising. After all, mass shooters represent a minuscule percentage of short-tempered, angry, resentful Californians. Those common traits may be seen as harbingers of murderous violence only in retrospect. Even the San Jose shooter’s ex-wife, who was reporting her recollections from more than a decade ago, said she never took him seriously when he talked about killing people at work.

A 2019 study of California’s red flag law described 21 cases in which fear of a mass shooting prompted police or relatives to seek GVROs. In some cases, the evidence was genuinely alarming, while others featured threats that may have been idle or facetious. Judging from “print, broadcast, and Internet media searches using Google,” the researchers said, the respondents in those cases did not subsequently commit any noteworthy violent crimes.

“It is impossible to know whether violence would have occurred had GVROs not been issued, and we make no claim of a causal relationship,” gun violence researcher Garen Wintemute and his co-authors wrote in the Annals of Internal Medicine. Nonetheless, the cases suggest that this urgent, individualized intervention can play a role in efforts to prevent mass shootings.”

Given the rarity of mass shootings, it seems clear that few, if any, of these 21 GVRO targets had serious plans to commit one. Prior to 2016, when the red flag law took effect, California was seeing an average of about two mass public shootings (defined as incidents in which the shooter killed four or more people in a public place) per year. Since then, there have been at least eight, or an average of about 1.5 a year.

While Assemblymember Ting might see the drop as evidence that the red flag law is working as intended, it would be risky to draw any conclusions at all from trends in such tiny, volatile numbers. Even if GVROs have prevented mass shootings, it probably would not be possible to measure that result with any confidence.

Although red flag laws are commonly touted as a way to stop mass shootings, that is far from their main use. While Ting’s tally does not include information on the motivation for GVROs, data from other states indicate that a large majority of gun confiscation orders are aimed at preventing suicide, not homicide. And even when petitioners allege that someone is a danger to others, the risk of a mass shooting is bound to be infinitesimal, since such crimes account for a tiny share of gun homicides and an even tinier share of unlawful firearm use.

The focus on mass shootings is therefore highly misleading in assessing the costs and benefits of red flag laws. A more relevant question is what percentage of people subject to gun confiscation orders actually would have used a firearm to kill themselves or others. Given the weak due process protections that are typical of red flag laws, that percentage is probably pretty small.

Data from Florida and Maryland indicate that judges nearly always grant ex parte orders. In Florida, judges issue final orders about 95 percent of the time. I have not seen comparable data for California, but its “significant danger” standard is amorphous enough to allow post-hearing orders in almost every case.

Although there is no solid evidence that red flag laws have an impact on homicide rates, a few studies suggest they may prevent suicides. But even those estimates indicate that the vast majority of people disarmed by these laws—90 to 95 percent—were not actually suicidal, or at least not suicidal enough to complete the act.

If you attach no value to the constitutional rights that people lose for the duration of a red flag order, those odds may not bother you. But if you think something important is lost when the government deprives someone of the fundamental right to armed self-defense, your assessment is apt to be different.

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General Flynn Believes COVID Was A “Weaponized Operation” By China

General Flynn Believes COVID Was A “Weaponized Operation” By China

Authored by Steve Wastson via Summit News,

President Trump‘s former national security advisor Michael Flynn commented on the renewed focus on the theory that the coronavirus came from a lab in Wuhan, saying that he believes it was a ‘weaponised operation’.

“We’ve had over a year of people all over the world having to answer tough questions,” Flynn said during an interview on 1320 AM WJAS.

The three star general continued “The people in this country are demanding answers. I believe we what we are going to find out is that this was a weaponized operation by the nation of China with some collaboration… with other countries.”

While Flynn suggested that the outbreak was “some kind of attack,” he also stated that it could have “occurred mistakenly because of poor operational conditions inside these laboratories in China.”

He also made it clear that he believes COVID is a real virus, and many older people have really died from it, countering leftist mainstream media claims that he believes the entire pandemic is completely ‘staged’.

“We must demand from our government [to know] exactly what happened,” Flynn urged, adding that “we’ve had the entire country and the entire world shut down, people have lost their livelihoods and businesses… this has caused a massive shift in our entire society.”

“The people of this country are not going to stand for just continuing to go down this road of these falsehoods and these lies about the origins of COVID,” Flynn asserted.

Listen:

As we reported earlier, Joe Biden has now claimed that he tasked the US Intelligence Community with looking into the origins of the pandemic in March, and has now again asked for a ‘redoubling’ of their efforts and a new report in 90 days.

The development comes after the administration was slammed for shutting down a Trump State Department investigation.

The lab leak theory has gained traction once again after a previously unseen US intelligence report revealed that at least three researchers working at the Wuhan Institute of Virology, where coronavirus experiments were being conducted, were hospitalised in mid November 2019 with symptoms matching those of COVID.

Commenting on the revelations, David Asher, the State Department’s former lead investigator on the origins of the virus said it is “very doubtful that three people in highly protected circumstances” all became sick with “severe conditions all in the same week, and it didn’t have anything to do with the coronavirus.”

Asher has previously said that the intelligence points to an involvement of the Chinese military conducting bioweapons research at the lab.

Previous reports have suggested that the Wuhan Institute took a shipment of some of the world’s deadliest pathogens just weeks before the outbreak of the coronavirus. It is also known that the lab was tampering with natural pathogens and mutating them to become more infectious through ‘gain of function’ research.

This is the ‘weaponisation’ that General Flynn is referring to.

A deadly virus leak from a Chinese lab is not unprecedented. The SARS virus escaped twice from the Chinese Institute of Virology in Beijing in 2004, one year after its spread was brought under control.

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Tyler Durden
Thu, 05/27/2021 – 15:22

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Why Didn’t California’s ‘Red Flag’ Law Stop the San Jose Shooter?


San-Jose-shooting-5-26-21-Newscom

People who worked with the perpetrator of yesterday’s mass shooting in San Jose expressed “generalized concerns about his mental health,” according to Mayor Sam Liccardo. The man’s ex-wife, who had not interacted with him for 13 years, recalled that he was “not mentally stable,” often expressed anger at his bosses and co-workers, and even talked about killing them. His former girlfriend, who accused him of “forc[ing] himself on me sexually” when he was intoxicated, said he had mood swings that were exacerbated by alcohol. A neighbor described him as short-tempered, saying, “I was afraid of him. My wife was scared of him too.”

The shooter apparently set his house on fire before killing nine fellow employees and himself at a San Clara Valley Transportation Authority maintenance facility. He seems like just the sort of person who was supposed to be stymied by a “gun violence restraining order” (GVRO) under California’s expansive “red flag” law, which would have forbidden him to possess firearms or ammunition for up to five years. That law, which was inspired by the 2014 massacre in Isla Vista, was presented as a way of preventing crimes like this.

The fact that the red flag did not stop the San Jose attack, or the other mass shootings that California has seen since the law took effect, highlights the limitations of this crime prevention strategy. The same could be said of California’s other gun controls, which include bans on “assault weapons” and magazines that hold more than 10 rounds, universal background checks and waiting periods for gun buyers, and a virtual ban on public carry. The expectation that such measures will prevent mass shootings shows how the focus on one rare type of violence distorts the debate about gun control.

A few weeks before the San Jose massacre, Assemblymember Phil Ting (D–San Francisco), who wrote a 2020 bill that expanded California’s red flag law, released data showing that a record number of GVROs were issued last year. The annual number of orders rose 15-fold between 2016 and 2020, from 85 to 1,285. All told, more than 3,000 GVROs have been approved since the red flag law took effect at the beginning of 2016.

“I’m glad that Californians have a tool to intervene to save lives and prevent tragedies,” Ting said in a press release. “The COVID-19 restrictions that kept people home may have influenced the rise,” he told the Los Angeles Times, “making them more mindful of the behaviors of others and open to seeking help from law enforcement or the courts directly.” But as the San Jose shooting shows, such mindfulness is not enough, because it is nearly impossible to predict which of the country’s many angry, aggrieved, and troubled residents will commit this sort of crime.

California allows both police and a long list of other potential petitioners to seek GVROs. That list initially included “any spouse, whether by marriage or not, domestic partner, parent, child, any person related by consanguinity or affinity within the second degree, or any other person who regularly resides in the household, or who, within the prior six months, regularly resided in the household.” Ting’s bill, which took effect in September, added employers, co-workers, and school employees to the list.

The idea behind letting so many people file petitions directly, rather than bringing their concerns or complaints to the police, is that it will make it easier to identify and promptly disarm potentially dangerous individuals. The risk of such a broad approach is that it makes it more likely that people will lose their Second Amendment rights due to malicious or erroneous allegations by biased petitioners. But so far in California, both the benefit and the danger have remained mostly theoretical. Ting’s numbers indicate that law enforcement officials obtained more than 95 percent of the GVROs issued in 2020—all but 59. A review of earlier cases found that nearly 97 percent were initiated by a law enforcement officer.

Police can obtain a “temporary emergency gun violence restraining order,” which lasts up to three weeks, by showing there is “reasonable cause” to believe the respondent “poses an immediate and present danger” to himself or others. Other petitioners can obtain an “ex parte gun violence restraining order” of the same duration by showing there is a “substantial likelihood” that the respondent “poses a significant danger, in the near future,” of injuring himself or others with a firearm.

At this stage, respondent is a misnomer, because the orders are issued without giving the target a chance to respond. He is supposed to get that opportunity at a hearing within 21 days of the initial order (although he has no right to legal representation if he can’t afford it). Among other things, the judge is supposed to consider the respondent’s history of threats or violence, his “abuse of controlled substances or alcohol,” and “any other evidence of an increased risk for violence”—factors that presumably would have weighed against the San Jose shooter.

After the hearing, the judge is required to issue a GVRO if he determines there is “clear and convincing evidence” that the respondent “poses a significant danger” of injuring himself or others. That danger need not be imminent, and it is not clear what “significant” means in this context.

The post-hearing GVRO lasts for one to five years and can be extended if a petitioner requests it. Once a year, the respondent can ask that the order be lifted, which is supposed to happen if there is no longer clear and convincing evidence that he poses “a significant danger.”

In theory, then, the San Jose shooter’s employer, his co-workers, or possibly his ex-girlfriend (if she lived with him during the previous six months) could have sought a GVRO against him, which would have made it illegal for him to possess or purchase firearms or ammunition. Assuming he did not obtain guns from an unmonitored source, such an order could have prevented yesterday’s mass shooting.

That did not happen, which is not really very surprising. After all, mass shooters represent a minuscule percentage of short-tempered, angry, resentful Californians. Those common traits may be seen as harbingers of murderous violence only in retrospect. Even the San Jose shooter’s ex-wife, who was reporting her recollections from more than a decade ago, said she never took him seriously when he talked about killing people at work.

A 2019 study of California’s red flag law described 21 cases in which fear of a mass shooting prompted police or relatives to seek GVROs. In some cases, the evidence was genuinely alarming, while others featured threats that may have been idle or facetious. Judging from “print, broadcast, and Internet media searches using Google,” the researchers said, the respondents in those cases did not subsequently commit any noteworthy violent crimes.

“It is impossible to know whether violence would have occurred had GVROs not been issued, and we make no claim of a causal relationship,” gun violence researcher Garen Wintemute and his co-authors wrote in the Annals of Internal Medicine. Nonetheless, the cases suggest that this urgent, individualized intervention can play a role in efforts to prevent mass shootings.”

Given the rarity of mass shootings, it seems clear that few, if any, of these 21 GVRO targets had serious plans to commit one. Prior to 2016, when the red flag law took effect, California was seeing an average of about two mass public shootings (defined as incidents in which the shooter killed four or more people in a public place) per year. Since then, there have been at least eight, or an average of about 1.5 a year.

While Assemblymember Ting might see the drop as evidence that the red flag law is working as intended, it would be risky to draw any conclusions at all from trends in such tiny, volatile numbers. Even if GVROs have prevented mass shootings, it probably would not be possible to measure that result with any confidence.

Although red flag laws are commonly touted as a way to stop mass shootings, that is far from their main use. While Ting’s tally does not include information on the motivation for GVROs, data from other states indicate that a large majority of gun confiscation orders are aimed at preventing suicide, not homicide. And even when petitioners allege that someone is a danger to others, the risk of a mass shooting is bound to be infinitesimal, since such crimes account for a tiny share of gun homicides and an even tinier share of unlawful firearm use.

The focus on mass shootings is therefore highly misleading in assessing the costs and benefits of red flag laws. A more relevant question is what percentage of people subject to gun confiscation orders actually would have used a firearm to kill themselves or others. Given the weak due process protections that are typical of red flag laws, that percentage is probably pretty small.

Data from Florida and Maryland indicate that judges nearly always grant ex parte orders. In Florida, judges issue final orders about 95 percent of the time. I have not seen comparable data for California, but its “significant danger” standard is amorphous enough to allow post-hearing orders in almost every case.

Although there is no solid evidence that red flag laws have an impact on homicide rates, a few studies suggest they may prevent suicides. But even those estimates indicate that the vast majority of people disarmed by these laws—90 to 95 percent—were not actually suicidal, or at least not suicidal enough to complete the act.

If you attach no value to the constitutional rights that people lose for the duration of a red flag order, those odds may not bother you. But if you think something important is lost when the government deprives someone of the fundamental right to armed self-defense, your assessment is apt to be different.

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Knock On Wood: Blackstone, Balyasny And About Ten Other Managers Bought ARKK Puts In Q1

Knock On Wood: Blackstone, Balyasny And About Ten Other Managers Bought ARKK Puts In Q1

If you had a sneaking suspicion that Wall Street was starting to bet against the “untouchable” Cathie Wood, as we did over the last couple months, you were right.

Today it was revealed that “about two dozen investment advisers” that included Balyasny Asset Management and a unit of Blackstone bought put options on ARK’s Innovation ETF during the first quarter. Blackstone bought puts on 1.3 million ARKK shares and Balyasny acquired puts on 436,500 shares. 

The managers saw Wood’s fund as a “alternative to buffer against a slump in stocks that surged during the pandemic,” that buying puts on an index, the report said. In other words, the asset managers were so confident in Wood’s ability to handpick stocks that would lose value during a pull back, they took the inverse of her “expertise” instead of just getting short a tech or small cap index (or both). 

And so far, that strategy likely provided outsized returns as a hedge: ARKK is down about 30% from its highs, while the QQQ ETF is down just about 0.7% from its February peak.

Chris Murphy, co-head of derivatives strategy at Susquehanna International Group, said: “If you were sitting on some serious gains heading into this year and you want to protect those gains, it was an effective strategy.”

Deer Park Road Management Co. bought puts on 2.15 million ARKK shares with a notional value of about $258 million. Deer Park Chief Investment Officer Scott Burg said: “As rates have been going up, the tech stocks have been getting crushed. You could see that in the first quarter.”

Efrem Kamen, the head of New York-based Pura Vida Investments, said: “The Ark Innovation fund had a tremendous run over the course of 2020 and early 2021. However, the level of fund flows into the ETF appeared to be extreme.” Kamen’s fund bought puts on 622,500 ARKK shares with a notional value of about $75 million. 

“Volatility on Ark Innovation ETF was an efficient way to hedge some of the factor risk in our portfolio,” Kamen continued. 

Eric Balchunas, an ETF analyst for Bloomberg Intelligence concluded: “Sometimes hedge funds look at Tesla and Ark, and think ‘This is just way too much and I can make a killing here.’”

Recall, at the beginning of 2021, we noted that short interest in Wood’s funds had “exploded” amidst their rise in 2020. 

And while shorts may have been paid modestly in 2021 so far, with ARKK about 30% off its highs, Wood’s ARK hasn’t sank just yet. Days ago we wrote that Wood’s strategy of selling liquid tech names in order to rotate into smaller, more “speculative” names has miraculously held up, so far, in 2021. 

Despite selling some of her largest holdings, ARK “no longer holds a stake bigger than 20% in any stock,” Bloomberg reported this week. The firm’s largest holding, formerly 21.3% in Compugen, is now down to 17.2%.

Nikko Asset Management has a minority stake in ARK and the number of stocks where the two asset managers own more than 20% has fallen to 8 names, from 10. 

Tom Essaye, a former Merrill Lynch trader, told Bloomberg: “This is an evolution a bit — Ark accepting it’s a large fund-family now. It makes sense that especially in some of the smaller cap names they are reducing that concentration. How much money you put to work in the smaller names can alter the risk-reward calculation.”

ARK’s flagship “Innovation” fund is down more than 32% from its peak on February 12, but outflows haven’t yet been rushed. This has allowed Wood the time for “an orderly adjustment of positions”. 

Todd Rosenbluth, head of ETF & mutual fund research at CFRA Research, commented: “My fear was that investors that were relatively new to the strategy would see weak performance and then pull out just as management had increasingly favored some of these smaller companies. But because investors have stayed relatively loyal, they have not had to make changes to the portfolio to meet client redemptions.”

Tyler Durden
Thu, 05/27/2021 – 15:00

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