Oil Algos Confused After Big Crude Draw, Product Build
Oil prices rallied on the day as signs of a demand recovery from the US to Europe stoke optimism among producers and analysts in the crude market, combined with waning hopes for an Iran nuke deal.
Oil is in “strong demand right now,” with economies around the world opening up, Daniel Yergin, the oil historian and vice chairman at consultant IHS Markit Ltd., said in a Bloomberg Television interview.
“Oil is bid on the Iran timeline to adding barrels getting kicked further into the future–sometime between August and the fall,” says Bob Yawger at Mizuho.
After last week’s across-the-board draws, analysts expected another week of demand dominance.
API
Crude -5.36mm (-3.3mm exp)
Cushing +741k
Gasoline +2.51mm (-1.1mm exp)
Distillates +1.585mm (-1.6mm exp)
While crude stocks tumbled more than expected, gasoline and distillate stocks unexpectedly rose last week…
Source: Bloomberg
WTI hovered just below $68.80 ahead of the API print and barely budged on the mixed data…
“There’s plenty of room for upside here,” said Bob Yawger, head of the futures division at Mizuho Securities.
“Summer and the reopening of the economy is bullish for demand,” while “it looks much less likely we’ll have Iranian barrels any time soon than it did last week.”
But, the question now is whether oil prices can hold their gains “amid strong demand, despite plenty of downside risk on the supply side,” said Robbie Fraser, global research & analytics manager at Schneider Electric, in a daily report.
The Department of Homeland Securityon Friday issued a new warning bulletin, alerting Americans that domestic extremists may well use violence on the 100th Anniversary of the Tulsa race massacre. This was at least the fourth such bulletin issued this year by Homeland Security (DHS) warning of the same danger and, thus far, none of the fears it is trying to instill into the American population has materialized.
The first was a January 14 warning, from numerous federal agencies including DHS, about violence in Washington, DC and all fifty state capitols that was likely to explode in protest of Inauguration Day (a threat which did not materialize). Then came a January 27 bulletin warning of “a heightened threat environment across the United States that is likely to persist over the coming weeks” from “ideologically-motivated violent extremists with objections to the exercise of governmental authority” (that warning also was not realized). Then there was a May 14 bulletin warning of right-wing violence “to attack higher-capacity targets,” exacerbated by the lifting of COVID lockdowns (which also never happened). And now we are treated to this new DHS warning about domestic extremists preparing violent attacks over Tulsa (it remains to be seen if a DHS fear is finally realized).
Just like the first War on Terror, these threats are issued with virtually no specificity. They are just generalized warnings designed to put people in fear about their fellow citizens and to justify aggressive deployment of military and law enforcement officers in Washington, D.C. and throughout the country. A CNNarticle which wildly hyped the latest danger bulletin about domestic extremists at Tulsa had to be edited with what the cable network, in an “update,” called “the additional information from the Department of Homeland Security that there is no specific or credible threats at this time.” And the supposed dangers from domestic extremists on Inauguration Day was such a flop that even The Washington Post — one of the outlets most vocal about lurking national security dangers in general and this one in particular — had to explicitly acknowledge the failure:
Thousands [of National Guard troops] had been deployed to capitals across the country late last week, ahead of a weekend in which potentially violent demonstrations were predicted by the FBI — but never materialized.
Once again on Wednesday, security officials’ worst fears weren’t borne out: In some states, it was close to business as usual. In others, demonstrations were small and peaceful, with only occasional tense moments.
Americans have seen this scam before. Throughout the first War on Terror, DHS, which was created in 2002, was frequently used to keep fear levels high and thus foster support for draconian government powers of spying, detention, and war. Even prior to the Department’s creation, its first Secretary, Tom Ridge, when he was still the White House’s Homeland Security Chief in early 2002, created an elaborate color-coded warning system to supply a constant alert to Americans about the evolving threat levels they faced from Islamic extremists.
In 2004, Ridge admitted that he had been repeatedly pressured by Bush officials to elevate the warnings and threat levels for political gain and to keep the population in fear. He claims that he, in particular, was coerced against his will to raise the threat level just prior to the 2004 presidential election and resigned for that reason shortly thereafter. DHS’s color scheme became “the brunt of endless jokes and derision,” concluded a 2007 scholarly study in the journal International Security, noting that it “became perceived as being politically motivated” largely due to the complete lack of specific information about what Americans were supposed to fear or avoid. Moreover, “its designers assumed that the population would trust in the national leadership and believe in the utility of the system’s information.” It failed because of how often the alleged threats failed to materialize, and because the warnings were rarely accompanied by any specificity that could permit action to be taken or avoided.
Though Obama scrapped the unpopular color-coded system in 2011, he — in a classic Obama gesture — merely replaced it with an equally vague and fear-generating bureaucratic alternative that was also subject to political manipulation. National security writers at Lawfareultimately acknowledged that “like the [Bush/Ridge] system, there were no clear triggers for alerts [under Obama’s new scheme,] so the system remained objective and opaque.” As a result, they said, “the lack of specificity over time has resulted in similar levels of confusion as surrounded the [Bush/Ridge] color alerts.”
Fear is crucial for state authority. When the population is filled with it, they will acquiesce to virtually any power the government seeks to acquire in the name of keeping them safe. But when fear is lacking, citizens will crave liberty more than control, and that is when they question official claims and actions. When that starts to happen, when the public feels too secure, institutions of authority will reflexively find new ways to ensure they stay engulfed by fear and thus quiescent.
I saw first-hand how this dynamic functions when doing the Snowden-enabled reporting on mass domestic NSA surveillance under the Obama administration. By the time we broke the stories of mass domestic surveillance on Americans — twelve years after the 9/11 attack — fear levels over Al Qaeda in the U.S. had diminished greatly, especially after the 2011 killing of Osama bin Laden. As a result, anger over Obama’s sprawling domestic surveillance programs was pervasive and bipartisan. A bill jointly sponsored by then-Rep. Justin Amash (R-MI) and Rep. John Conyers (D-MI) — which would have greatly reined in NSA domestic spying powers — was on its way to easy, bipartisan victory as a result of that anger over NSA spying. But suddenly, the Obama White House convinced Nancy Pelosi to whip enough Democratic votes to ensure its defeat and save NSA domestic spying from reform. But the momentum which that bill had — it would have been the first since 9/11 to rollback rather than expand government powers — along with anti-surveillance-and-pro-privacy polling data, proved how significantly the playing field had shifted as a result of those revelations and, especially, the reduction in fear levels experienced by Americans.
But shortly thereafter, a new group — ISIS — emerged to replace Al Qaeda. It had a two-year stint with middling success in scaring Americans, but it was sufficient to turn back the tide of pro-privacy sentiment (at one point in 2014, the U.S. intelligence community claimed out of nowhere that a Syria-based group that virtually nobody in the U.S. had ever heard of previously or since — “the Khorasan Group” — was “a more direct and imminent threat to the United States,” but that new villain disappeared as quickly as it materialized). After ISIS’s star turn in the role of existential threat, the Democrats, during the 2016 campaign, elevated Russia, Putin and the Kremlin to that role, abandoning without explanation Obama’s eight-year argument that Russia was merely a regional power of no threat to the U.S. This revolving carousel of scary villains ensured that the pressure to reduce the powers and secrecy of the U.S. security state eroded in the name of staying safe.
Before Joe Biden was even inaugurated, he and his allies knew they needed a new villain. Putin never generated much fear in anyone beyond MSNBC panels, the CNN Green Room, and the newsrooms and op-ed pages of The New York Times and The Washington Post. While negative views of Russia increased in the U.S. during Russiagate mania, few outside of hard-core Democratic partisans viewed that country as a genuine threat or primary enemy. Few Americans woke up shaking in fear about what the Kremlin might do to them.
The search for a new enemy around which the Biden administration could coalesce and in whose name they could keep fear levels high was quickly settled. Cast in that role would be right-wing domestic extremists. In January, The Wall Street Journal reported that “Biden has said he plans to make a priority of passing a law against domestic terrorism, and he has been urged to create a White House post overseeing the fight against ideologically inspired violent extremists and increasing funding to combat them.”
Pending Domestic War on Terror legislation favored by the White House — sponsored by Rep. Adam Schiff (D-CA) — would simply amend the old War on Terror laws, which permitted a wide range of powers to fight foreign terrorist organizations, so as to now allow the U.S. government to also use those powers against groups designated as domestic terror organizations. Just as was true of the first War on Terror, this second one would thus vest the government with new, wide-ranging powers of surveillance, detention, prosecution and imprisonment, though this time for use against U.S. citizens on U.S. soil.
Even while that legislation is pending, the U.S. government is already waging an aggressive new domestic war on terror that has largely flown under the radar. Grave warnings from DHS are now just as common, vague and unreliable — but also fear-inducing — as they were in the days of Tom Ridge. Domestic surveillance is also on the rise. Last month, CNN reported that “the Biden administration is considering using outside firms to track extremist chatter by Americans online, an effort that would expand the government’s ability to gather intelligence but could draw criticism over surveillance of US citizens.”
he security mindset has subsumed the Democratic Party in particular. Just last week, the same Party that spent the summer of 2020 denouncing the police approved $1.9 billion in additional spending for Capitol security and police. The very faction of that party which chanted “Defund the Police” — the Squad — had the power to stop that expenditure, but half of them instead voted “present,” ensuring its passage.
Meanwhile, one of the most repressive features of the first War on Terror — due-process-free no-fly lists against American citizens — is now back in full force. Democratic Senate Majority Leader Chuck Schumer (D-NY) and House Homeland Security Committee Chairman Bennie Thompson (D-MS) have both been demanding that the FBI ban January 6 protesters and other “domestic extremists” from air travel without being convicted of any crime or even given a hearing to determine whether this prohibition is justified. Rep. Thompson even demanded that Sens. Ted Cruz (R-TX) and Josh Hawley (R-MO) be put on the no-fly list, then took to Twitter to boast of how proud he was of this demand:
Beyond the DHS bulletins, that agency and other intelligence operatives continue to issue reports, for both public and classified consumption, warning that the greatest national security threat the U.S now faces is domestic extremism. As we reported here last month, that “domestic extremist” designation includes not just anti-Biden and anti-government protesters on the right but also leftist groups including animal rights activists — essentially anyone who objects to prevailing ruling class dogma and wants to use their constitutional rights to advance those views. To compile these reports, the CIA appears clearly to be breaking the law in using its vast intelligence weapons for domestic monitoring and control.
Online censorship, of course, is also rapidly increasing in the name of stopping the threat of domestic extremism. The extraordinary destruction of Parler in January by three Silicon Valley monopolies — Apple, Google and Amazon — occurred after leading Democrats, including Rep. Alexandria Ocasio-Cortez (D-NY) — publicly demanded the platform’s removal from the internet. And Democratic-led Congressional committees continue to summon Silicon Valley executives to demand they impose greater degrees of political censorship against their political adversaries or else face legislative and regulatory reprisals.
These are all the same weapons as the ones invoked for the first War on Terror. Yet what is perhaps most notable about comparing this new domestic War on Terror to the first one is not the common weapons invoked to fight it but rather how identical are the rhetorical strategies used to demand submission to it.
No nuance or questioning is permitted when it comes to discussions of how much danger America really faces from domestic extremists. The parallels with the first War on Terror are manifest.
I know of nobody who dismissed the significance of the 9/11 attacks. A one-day attack that wipes out 3,000 human beings and crashes four passenger jets into three large buildings is a gravely serious event. But there were plenty of people — including myself — who spent years arguing that the threat reflected by that attack was being aggressively and deliberately exaggerated by U.S. officials and both political parties in order to justify extraordinary power grabs for themselves.
In response, a standard tactic was deployed against those who, after 9/11, urged that the threat be placed in rational context rather than melodramatically and cynically inflated. Anyone urging sober restraint was instantly accused of being sympathetic toward if not outright supportive of anti-American terrorism. The Bush administration demanded a binary framework most vividly expressed by the then-president’s decree in his late September, 2001, address to the Congress: “Either you are with us or you are with the terrorists.” And thus was any middle ground — I condemn the 9/11 attack but oppose dangerous overreaction or authoritarian power grabs in the name of combatting it — abolished.
That Bush “with-us-or-with-the-terrorists” directive provoked a fair amount of outrage at the time but is now the prevailing mentality within U.S. liberalism and the broader Democratic Party. I do not know a single prominent commentator or political figure who, after seeing what transpired, expressed support for the January 6 riot at the Capitol. Quite the contrary: all of them, at least to my knowledge, condemned the conduct of at least some of the protesters on that day. From the start, that group certainly included me (on January 7, I wrote: “It is not hard to understand why [the Capitol riot] has generated intense political passion and pervasive rage: the introduction of physical force into political protest is always lamentable, usually dangerous, and, except in the rarest of circumstances that are plainly inapplicable here, unjustifiable”). That is still my view, even as I denounce the Biden administration’s expansive domestic powers and attempts to exaggerate the threats and dangers that protest illustrated.
But that position is disallowed, or at least not recognized. Just as was true of the first War on Terror, any attempt to place the actual lingering threat in context (by rejecting the claim that the danger is so grave that it requires vast new powers), or to suggest it is being manipulatively exaggerated (by calling it The Insurrection), or to document actual lies being told in service of the prevailing narrative (such as the ongoing lie that a pro-Trump crowd murdered Officer Brian Sicknick) provokes furious accusations that one must be sympathetic to if not supportive of the January 6 rioters and any groups associated with them. Attempts to suggest that those charged in connection with the January 6 riot are being excessively prosecuted and punished provoke even greater rage — despite the fact that not a single one of them has been charged with treason, sedition, insurrection or domestic terrorism, and despite the fact that concerns about overzelaous prosecutors and the carceral state are supposed to be staples of liberals politics (though ones which, like anti-police sentiment and opposition to killing unarmed protesters, instantly disappear when convenient, such as when it comes time to exploit Officer Sicknick or cheer the fatal point-blank shooting of the unarmed Ashli Babbitt).
Objections to new powers vested in the U.S. security state in the name of fighting domestic terrorism are met with still greater scorn. If you oppose new anti-terrorism legislation for use on U.S. soil or are deeply concerned about the invocation of civil-liberties-destroying weapons such as no-fly lists, online censorship, and heightened domestic surveillance, then it is assumed that you must support domestic extremists — just as those who opposed the war in Iraq or the Patriot Act or NSA spying or torture were accused of supporting Al Qaeda.
It is a shoddy, anti-intellectual and deceitful tactic, to be sure, but it is now commonplace. And that is particularly concerning as the Democrats’ devotion to a new War on Terror continues to grow. On Monday, President Biden, citing “the intelligence community,” asserted that white supremacist terrorism is “the most lethal threat to the Homeland today.”
Opposing this new domestic War on Terror and all those new powers and secrecy authorities that go with it does not require support for or even indifference toward what happened at the Capitol on January 6. It merely requires a basic knowledge of recent U.S. history and how these powers are invariably used by the secretive U.S. security state when government-generated fears lead to their widespread enactment. The dangers of the first War on Terror were grave enough. Transferring it to “the Homeland,” as President Biden calls it, is bound to be far more dangerous still.
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Andrew Doyle is an Irish journalist and writer best known as the creator of the Twitter personality Titania McGrath, a parody of an ultra-woke, 24-year-old, militant vegan who thinks she is a better poet than William Shakespeare. Though the 43-year-old Doyle describes himself as a left-winger, he is a fierce critic of cancel culture and a proponent of Brexit. He holds a doctorate from Oxford in early Renaissance poetry, is the host of the new nightly show GB News, and is a columnist for Spiked Online. (He’s a previous guest on The Reason Interview with Nick Gillespie.)
Doyle is also the author of the new book Free Speech and Why It Matters, a comprehensive, learned, and compelling argument in favor of unfettered debate and open expression. Nick Gillespie talks with him about why cancel culture is on the rise, how to combat it, and what Titania McGrath is up to as she approaches her quarter-life crisis.
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And while GME managed gains, the AMC surge took it above $30 billion market cap and bigger than GME…
Source: Bloomberg
GTT also exploded today (up over 50%)…
AMC’s trading volume today was by far the largest of any in the US – triple TSLA’s which was in second place…
Source: Bloomberg
Oh, and if you cared, the broad indices were up and down like a whore’s drawers (Small Caps puked at the cash open and Nasdaq spiked, in a reverse of yesterday’s action). A late day panic-bid moved them all barely into the green…
VIX had another mini-flash-crash around the pre-open again…
Ok, so enough of that malarkey, here’s what happened everywhere else in the markets…
The dollar pumped and dumped to end unchanged…
Source: Bloomberg
Bonds were bid…
Source: Bloomberg
Bitcoin bounced back up to $38k…
Source: Bloomberg
Ether tagged $2800 intraday…
Source: Bloomberg
And Bullion buying lifted futures above $1910…
Black Gold also extended its gains ahead of tonight’s API inventory data, with WTI tagging $69…
Finally, the correlation between VIX (fear) and 10Y Treasury yields (no fear) is at its highest since late 1999…
Source: Bloomberg
And we all know what happened next, stonks were slammed and yields collapsed…
Source: Bloomberg
Taper tantrum triggered?
For now, no one is worried at all as the Put-Call ratio just hit its lowest since 2011…
Andrew Doyle is an Irish journalist and writer best known as the creator of the Twitter personality Titania McGrath, a parody of an ultra-woke, 24-year-old, militant vegan who thinks she is a better poet than William Shakespeare. Though the 43-year-old Doyle describes himself as a left-winger, he is a fierce critic of cancel culture and a proponent of Brexit. He holds a doctorate from Oxford in early Renaissance poetry, is the host of the new nightly show GB News, and is a columnist for Spiked Online. (He’s a previous guest on The Reason Interview with Nick Gillespie.)
Doyle is also the author of the new book Free Speech and Why It Matters, a comprehensive, learned, and compelling argument in favor of unfettered debate and open expression. Nick Gillespie talks with him about why cancel culture is on the rise, how to combat it, and what Titania McGrath is up to as she approaches her quarter-life crisis.
from Latest – Reason.com https://ift.tt/3g6ixI8
via IFTTT
Larry Fink: Inflation Will Be A “Pretty Big Shock”
According to every career economist, market strategist and Fed lackey, inflation is transitory. The most important man on Wall Street disagrees.
Speaking at a virtual event hosted by Deutsche Bank, Blackrock CEO Larry Fink who manages more money than the Fed (over $9 trillion at last check) countered soothing talk that soaring prices are here and gone tomorrow, and said that investors may be underestimating the potential for a spike in inflation.
“Most people haven’t had a forty-plus year career, and they’ve only seen declining inflation over the last 30-plus years. So this is going to be a pretty big shock”, Fink said, his warning falling on deaf ears.
Alas, unlike the Fed, Fink actually know what he is talking about: he began his career at First Boston Corp. in 1976, in during runaway US inflation, with the Consumer Price Index hitting a high of 14.8% in March 1980, and forcing Volcker to hike rates as high as 20%.
Fink added that central banks may have to reassess their policies if higher prices become a concern, but as even the shoeshine boy knows by now, the Fed’s mantra is that “inflation is transitory” and thus the Fed has absolutely no idea what to do if it loses control of inflation as the alternative is the biggest market crash in history.
Instead, to keep markets stable, the Fed has vowed to keep rates at zero for at least another two years. If the Fed were to reconsider that, it would be incompatible with the massive fiscal stimulus unleashed by the US, Fink said. Joe Biden has proposed additional measures to stimulate the U.S. economy, including a $1.7 trillion infrastructure spending plan. All that stimulus requires rock-bottom interest rates.
“That would be pretty odd, raising interest rates at the same time we do this giant fiscal stimulus,” Fink said.
Of course, being Blackrock, Fink could not somehow try to tie soaring prices to global warming instead of – say – the trillions in newly created funds injected into the market, and did just that saying that prices may also rise as companies adapt to the realities of climate change:
“If our solution is entirely just to get a green world, we’re going to have much higher inflation, because we do not have the technology to do all this, yet,” Fink said.
“That’s going to be a big policy issue going forward too: Are we going to be willing to accept more inflation if inflation is to accelerate our green footprint?”
In short: if you can no longer afford to eat or rent, take one for the team. As for Larry, we doubt he will stop flying private or sell all of his sea-level mansions due to the imminent melting of the north pole.
The first thing any economist should do wen reading a budget proposal is to analyse the basic macro assumptions and the results presented by the administration. When both are poor, the budget should be criticised. This is the case of the Biden Budget Plan.
Same growth, a lot more debt and less employment.
According to the administration, the impact on growth of this budget will be negligible, as their own -and optimistic- estimates see no change in the slowdown of the U.S. economic growth trend.
The CBO (Congressional Budget Office, The Budget and Economic Outlook: 2021 to 2031) estimates a 1.7% average real growth in GDP between 2020 and 2030, the same average they forecast for the 2025-2030 period. This is lower than the potential real GDP growth of the U.S. economy but driven by much higher debt… with lower employment.
The CBO also expects an extremely poor job growth, with the unemployment rate at an average of 4.8% in the 2020 to 2030 period, a 4.1% for 2025-2030. This means not achieving the unemployment rate of 2019 even by 2030 after spending $6 trillion.
Even more concerning is the massive deterioration of the financial position of the United States. The Committee For A Responsible Federal Budget (CFRB) warns that “Federal debt held by the public would rise from 100 percent of GDP at the end of FY 2020 and a record 110 percent of GDP in 2021 to 114 percent of GDP by 2024 and 117 percent of GDP by the end of 2031. In nominal dollars, debt would grow by $17.1 trillion through the end of FY 2031, from $22.0 trillion today to $39.1 trillion in FY 2031” (President Biden’s Full FY 2022 Budget).
This is a concern because history shows us that these estimates tend to err on the side of optimistic and that debt rises faster.
The $3.8 trillion of offsets in the budget are exceedingly optimistic. The Biden administration assumes that the tax hikes will have no impact whatsoever on investment and forecasts an overly optimistic revenue collection trend. For example, estimates of tax revenue assume a growth above GDP and without any single slump in the entire period, something that has not happened in decades. Even so, the administration estimates will only cover around three-quarters of the cost of new spending, as budget deficits would total $14.5 trillion over the next decade. Annual deficits will likely average $1.4 trillion (4.7 percent of GDP) every year for a decade. There is no single year in which outlays will be covered by revenues even in these bullish estimates of economic growth.
According to the CFRB “rather than putting the debt on a stable and then downward path relative to the economy, the President’s budget would blow past the prior record and increase debt levels to 117 percent of GDP by 2031”.
Spending increases to 24.5 percent of GDP over the coming decade, according to the CFRB. The Biden administration’s baseline projection is 22.7% of GDP, significantly above both the 50-year averages of 20.6 and 17.3 percent of GDP. The problem is that most of it goes to current spending without real economic return and increasing entitlement programs that will likely affect productivity, employment, and investment. Even in the Biden administration forecast, annual spending would be 4% of GDP higher than revenues… And those revenue estimates are excessively bullish.
So how does the Biden administration expect to pay for rising deficits and debt? Neo Keynesian economists say that deficits do not matter and that the Federal Reserve can monetize the excess of spending. This begs two questions: If deficits do not matter why raise taxes massively? and, why not cut taxes instead?
The most dangerous part of the budget is that all this spending delivers no real improvement over the average trend of growth and employment while ballooning the Mandatory Spending side of the budget, making it impossible for future administrations to balance the budget.
Mandatory outlays rise by $1.2 trillion between 2021 and 2030, which shows that no revenue measure now of in the future can eliminate the deficit or cut the debt. No realistic estimate of economic growth or improved tax revenue estimate can offset an increase of $14.5 trillion in debt in ten years. As mandatory spending increases, the likelihood of improving the fiscal challenges of the U.S. economy slide away. One small recession in the next ten years and the debt will rise even faster, way above 120% of GDP.
The CBO and Biden administration projections show tax revenues rising every year in every category, and we all know this is simply impossible looking at the history of the past five decades. Furthermore, even with the CBO or Biden administration estimates, there is one clear conclusion: The United States deficit problem is a spending problem. No realistic revenue measure will balance the budget.
The question is, what inflation are they going to generate to dissolve this debt? This is the biggest risk of this budget. The Biden administration is clearly aiming at a massive increase in consumer prices to soften the debt blow in real terms, and this means lower real wage growth, weaker purchasing power of salaries and, more importantly, destruction of savings and the purchasing power of the U.S. dollar.
Many economists point to the European Union showing that many countries have levels of debt that are higher than 116% of GDP. True. They also show weaker growth, poorer employment rates and subdued productivity growth. There is also a lesson there. France, a country that has constantly raised taxes to allegedly finance a high government spending has not has a balanced budget since the late 70s and the economy has been in stagnation for decades. Unemployment, even in growth periods, is much higher than in the United States.
When you copy the European Union, you also should know you will get European Union-style lack of growth and job creation.
The Biden budget plan, in its own estimates, does not deliver higher growth or better employment levels. Reality will likely show that the results will be even poorer.
Iran Says Nuclear Negotiators Close To Agreement – Remaining Barriers “Not Unsolvable”
Iran now says that remaining contested issues between it and the United States are “not unsolvable” and that all parties appear in agreement on this point at a moment the latest round of talks in Vienna are wrapping up. The Islamic Republic’s deputy foreign minister and chief negotiator Abbas Araghchi told state TV on Wednesday that of nuclear issues which remain, presumably including the dropping of US sanctions, they “have reached a point where everyone believes that they’re not unsolvable.”
“All the delegations are determined and there is full seriousness” he added, while also noting Wednesday’s meeting will decide a “return date” for talks, also as after last week it was widely reported that draft documents were being finalized, suggesting a deal which includes US reentry into the JCPOA is imminent.
“I do not think there will be much delay between today’s meeting and the next round of talks. Like in the previous rounds, we will probably return to Vienna after consulting with our capitals,” Araqchi observed further. Reviewing the format of the talks an ‘indirect’ nature of Washington’s negotiating involvement, Reuters writes that “Such meetings of the remaining parties – Iran, Russia, China, France, Britain, Germany and the European Union – in a format known as the Joint Commission have punctuated and bookended indirect talks between Iran and the United States on both countries returning to full compliance with the 2015 deal.”
“The EU chairs Joint Commission meetings in the basement of a luxury hotel and leads shuttle diplomacy between Iranian envoys and a U.S. delegation based in another luxury hotel across the road. Iran refuses to hold direct talks with Washington,” the report details.
Despite the optimistic reports of major progress of late, the big geopolitical wildcard which puts a question mark over the whole proceedings is Israel and an embattled prime minister on his way out politically who just days ago vowed that “containment” of a nuclear armed Iran “is not an option”. PM Netanyahu further said:
“I’ve told this to my friend for 40 years, Joe Biden, and I said to him, ‘With or without a deal, we will continue to do everything in our power to thwart the armament of Iran with nuclear weapons.’“
And interestingly also on Wednesday there was the mysterious sinking of Iran’s largest warship, the Kharg, which caught fire in the Gulf of Oman and sank.
The Fars and Tasnim news agencies reported that efforts to save the Kharg (after the island where Iran’s main oil terminal sits), were a failure. The fire started around 0225 local time roughly 1,270 kilometers (790 miles) southeast of Tehran in the Gulf of Oman, not far from the Strait of Hormuz, where several Saudi oil tankers have been attacked in recent years (the US Navy accused the Iranians of using limpet mines to carry out these attacks).
The question remains: are we seeing an emboldened Netanyahu with nothing to lose politically (and much to gain as the ‘national security hawk’) ordering covert action to sink the positive momentum in Vienna?
It’s common knowledge now that the stock market is obscenely valued. To go along with these lofty valuations, we now have an obscene amount of bullish positioning in the equity markets.
First, as noted recently by SentimenTrader, small speculators in the futures market have gone nuts recently. The chart below plots the total value of the net position of “non-reportable” in S&P 500 contracts. Never before have we seen these wrong-way traders make such a massive bet on higher stock prices.
At the same time, we have seen the assets in leveraged ETFs scream higher over the past year or so. From just under $10 billion in assets at the March, 2020 low, these funds have grown to well over $25 billion in assets. Clearly, small speculators have come to embrace risk in ways we have never seen before.
These two indicators echo the message from the margin debt statistics which show an unprecedented amount of leveraged speculation in the markets at present, both in nominal and relative terms.
This sort of extreme crowding, seen in futures, leveraged ETFs and and in money borrowed in brokerage accounts, suggests that any equity market weakness that may materialize over the next few months could play catalyst for a serious bout of deleveraging.
The editorial board of the Los Angeles Times is telling the city’s NIMBYs to stop trying to use historic preservation laws to shut down a needed housing development.
Today’s editorial is about the future of Taix French Restaurant, which has been operating on Sunset Boulevard in Echo Park since 1962. Its owner, Michael Taix, is attempting to sell the property to developers, who want to replace it with a mixed-use project that would include housing and commercial space.
Taix wants to reopen in a smaller space within this new development. He told Times reporter Emily Alpert Reyes that this change was necessary for his business to survive because he cannot continue to financially support the current building.
But historic preservationists—or those who claim to be but really just don’t want new housing in their neighborhood—have been fighting to stop the deal. Despite Taix saying that he can’t keep operating this space, one woman told Reyes that she wanted to preserve the building entirely because she had such great feelings about having eaten there. Taix’s livelihood is no match for her desire to “feel like [I] belong, and that the city means something to [me] other than real estate.”
Her memories will persist regardless of whether or not Taix French Restaurant remains, and it’s absolutely reprehensible for nostalgia to be used as an excuse to overrule somebody’s property rights and to stand in the way of L.A.’s need for more housing.
Reason has taken note of several terrible examples of people in Los Angeles (andelsewhere) attempting to use historic preservation regulations not to restore something that’s actually significant, but to stop development they don’t like, even over the objection of the longtime owner of the business. Here, the Times editorial board is just not having it:
It should be an easy choice. There’s no point in preserving the cutesy faux French shell of Taix if the restaurant goes out of business. And there’s no good reason to forgo much-needed housing, especially affordable housing, just so people can drive by the old Taix building and savor their memories. Nostalgia is not a sufficient reason to reject development.
While a Times editorial is probably a good avenue to reach these NIMBY types, I don’t hold out much hope they’ll change any minds. Most of the arguments against development in Los Angeles stem from a selfish love of the status quo from people who already own property and don’t want things to change. Sunset Boulevard is a transit corridor and prime for this exact kind of development. This should be the kind of location where battered old buildings that no longer serve their purpose are replaced with bigger buildings that can help make space for more people to live.
But a lot of Taix’s opponents don’t actually want to solve the city’s housing problem if it means changing the L.A. they know and love. The L.A. Conservancy pulls the typical NIMBY trick of insisting that it does support more and denser housing, but just not this particular housing because it’s … not more or dense enough. I smell disingenuousness:
In addition to standing up for historic places, the Conservancy strongly supports increased density and new housing when it makes sense, especially if much-needed affordable housing is provided. In this case, it is a “lose-lose” proposition as the proposed project provides minimal affordable housing, the design and density achieved is underwhelming, and it needlessly demolishes a longtime legacy business building and neighborhood landmark.
The proposal is for 170 apartments on the property. There are currently zero apartments on the property. That’s far from “underwhelming” density.
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