“Team Transitory” Is Dead After Powell Says “Time To Retire Word Transitory Regarding Inflation”

“Team Transitory” Is Dead After Powell Says “Time To Retire Word Transitory Regarding Inflation”

Remember when clueless macrotourists  and worthless econo-hacks who have zero understanding of actual economic dynamics spent miles of digital ink convincing their tiny echochambers that they were right and that inflation was transitory (or rather, desperately scrambled to mask their utter lack of grasp of even the simplest concepts):

Well, one month ago we made it quite clear where in the financial pecking order these so-called ‘experts’ fall…

… and then moments ago none other than Jerome Powell put to rest any further debate on the topic of transitory vs permanent inflation:

  • *POWELL: TIME TO RETIRE THE WORD TRANSITORY REGARDING INFLATION
  • *POWELL: THREAT OF PERSISTENTLY HIGHER INFLATION HAS GROWN

Powell’s cremation of “team transitory” took place after the Fed chair was asked how long inflation has to run above-target before he decides it’s not so transitory, with Senator Pat Toomey mocking the term “transitory”, saying: “Everything is transitory. Life is transitory” to which he could have also added that “on a long enough timeline the survival rate for everything drops to zero.

In response, Powell said it’s probably a good time to “retire that word”, a clean and clear admission from Powell that inflation is no longer transitory.

And while it is certainly good news that we can finally stop polluting the airwaves with idiotic discussions whether inflation is transitory or not, it hardly helps Americans because as the latest BofA transitory vs permanent inflation reading shows, both are at all time highs.

The market was not happy either because just moments later, Powell also said the one thing that traders dread, namely that the taper could wrap up a few months earlier:

  • *POWELL: CAN CONSIDER WRAPPING UP TAPER A FEW MONTHS SOONER

Tyler Durden
Tue, 11/30/2021 – 11:12

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Stocks, Bonds Tumble As Powell Warns On Accelerated Taper

Stocks, Bonds Tumble As Powell Warns On Accelerated Taper

Fed Chair Powell has been more hawkish than many expected during this morning’s hearings, specifically noting the non-transitory nature of inflation and the need to use his tools to address it.

One specific thing he raised  was that The Fed “can consider wrapping up the taper a few months sooner.”

This was not what the market wanted to hear and stocks and bonds immediately dumped…

Stocks immediately reversed their post-open ramp…

10Y Yield spiked higher…

And the Dollar spiked…

The Powell-Put just went kaput…

Tyler Durden
Tue, 11/30/2021 – 10:59

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Charles Fried’s Hat and Sweater

Charles Fried is a law professor at Harvard, and served in several positions in the Reagan Administration, including as Solicitor General. During the debates over the Affordable Care Act, Fried made national headlines. He promised that if the Supreme Court invalidated Obamacare, he would eat his “kangaroo skin hat.” In Unprecedented, I noted that Fried actually found a chef who would bake a cake in the shape of his hat, just in case. Alas, due to the Chief Justice’s saving construction, Fried would never have to eat his hat. Now Fried is making another sartorial appeal to the Chief Justice.

Today, Fried published a guest essay in the New York Times titled “I Once Urged the Supreme Court to Overturn Roe. I’ve Changed My Mind.” Generally, authors do not get to pick their headlines. So it is difficult to determine whether Fried adopted this headline. Moreover, it isn’t clear what exactly he changed his mind about.

In Webster v. Reproductive Health Services, Fried argued that the Court should overrule Roe. At the time, he “did not see how the Constitution provides a principled basis for answering the question” of how to balance the “liberties of the pregnant woman” and “the life of another person, the fetus.” Fried adds that he was “personally agnostic on that issue.” I’ll admit, I don’t know many legal conservatives who are “personally agnostic” on abortion. Fried, who clerked for Justice Harlan when Poe v. Ullman was decided, also said that Harlan’s dissent provided “foundation of the law of privacy and personal dignity.” Again, I don’t know many legal conservatives who take the concept of “personal dignity” as a valid constitutional doctrine. (I am forever grateful I will never have to read another Anthony Kennedy decision extolling “dignity.”).

But something changed for Fried between 1989 and 1992. He writes:

In the 1992 case of Planned Parenthood of Southeastern Pennsylvania v. Casey, a joint opinion of Justices Sandra Day O’Connor, Anthony Kennedy and David Souter reaffirmed the central holding of Roe and put it on a firmer constitutional basis: the dignity and autonomy of the pregnant woman and the equal rights of women more generally.

Again, I do not know many legal conservative who thinks that Casey put Roe on a firmer constitutional basis. Dignity and autonomy are made-up constitutional values, just like emanations and penumbras. And Casey did not embrace the equal protection argument that Justice Ginsburg and others have advanced over the years. Instead, Casey adopted a method of stare decisis that was overtly political, and requires looking to public perception to decide the contours of constitutional law. Dissents from Chief Justice Rehnquist and Justice Scalia spell these arguments out in detail. I take it Fried disagrees with these two dissents, and stands with Souter.

Fried continues that Casey has formed the structure for other Supreme Court decisions, such as Lawrence v. Texas and Obergefell v. Hodges. (Both of those cases were 5-4, with the conservatives in sharp dissent). He writes that Casey “not only taken root; it has flourished and ramified.” Fried concludes that “[t]o overturn Roe now would be an act of constitutional vandalism — not conservative, but reactionary.”

I disagree. The original act of constitutional vandalism was Roe. To extend the metaphor, the Warren and Burger Courts were career criminals–arsonists, really–slashing and burning entire swaths of the Constitution to advance their ideal of a just society. The Casey plurality was an attempt to coverup to that vandalism–perhaps call them co-conspirators to the constitutional vandalism. Doubling down on that distortion in Dobbs would perpetuate those errors. Overruling Roe and Casey would be responsible, not reactionary. Stare decisis cannot mean “let the decisions of the Warren Court stand.”

Fried closes with another constitutional metaphor based on clothes, directed right at the Chief Justice:

When I argued Webster and made the case that overturning Roe would not undermine the broader foundation of privacy, I learned a lesson in the use of metaphor. Seeking to invoke my mentor John Harlan, I said I was not urging the unraveling of the whole fabric of substantive due process and unenumerated rights, but only to pull this one thread. To which my opponent replied that in his experience every time he pulled a thread on his sweater, the sleeve fell off.

In Webster, Fried offered these opening remarks:

Thank you Mr. Chief Justice and may it please the court. Today the United States asks this court to reconsider and overrule its decision in Roe v. Wade. At the outset, I would like to make quite clear how limited that submission is. First, we are not asking the Court to unravel the fabric of unenumerated and privacy rights which this court has woven in cases like Meyer and Pierce and Moore and Griswold. Rather, we are asking the Court to pull this one thread.

His opposing counsel, Frank Susman, offered this rejoinder:

Mr. Chief Justice, and may it please the court, I think the Solicitor General’s submission is somewhat disingenuous when he suggests to this court that he does not seek to unravel the whole cloth of procreational rights, but merely to pull a thread. It has always been my personal experience that when I pull a thread, my sleeve falls off. There is no stopping. It is not a thread he is after. It is the full range of procreational rights and choices that constitute the fundamental right that has been recognized by this court. For better or for worse, there no longer exists any bright line between the fundamental right that was established in Griswold and the fundamental right of abortion that was established in Roe.

Fried may still be smarting, three decades later, from being called “disingenuous.”

But the admonition is wrong. In light of the Glucksberg framework, Meyer and Pierce are safe. The rights of parents to direct the upbringing of their children are deeply rooted in our nation’s history and traditions. Moreover, I recently asked several social conservatives what they would think if Meyer and Pierce were jettisoned along with Roe. The answer was overwhelmingly positive. Indeed, today those cases are largely recast as First Amendment cases, so they have little separate value as substantive due process decisions.

Ultimately, I think Attorney General Meese offers a far more representative account of how legal conservatives–especially those from the Reagan Revolution–view Dobbs.

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When Does Government “Fairly Represent” Public Interest Groups’ Views, Thus Barring Them from Intervening?

As I like to say, the lawyer’s true superpower is to turn every question into a question about procedure. But there’s a good reason for that: Sound procedural rules are critical to a just and efficient decision on the substance. (Unsound procedural rules, of course, are also important, though in a bad way.)

One particularly important procedural rule has to do with when parties, including public interest groups, can intervene in a case—and, in particular, when they can intervene when a government party is saying “no need, we’ve got this” and the groups are saying “no you don’t.” This has come up most recently with the Foundation for Individual Rights in Education’s attempt to make important constitutional arguments in a Title IX case, but the issue comes up more broadly. Here’s how FIRE puts it in its cert. petition in FIRE v. Victim Rights Law Center, which the Court is scheduled to consider Friday:

Under Federal Rule of Civil Procedure 24(a)(2), an entity that seeks to intervene as of right must establish that none of the existing parties “adequately represent” its interests. In cases in which someone seeks to intervene on the side of a governmental entity, the First Circuit and several other courts of appeals apply a presumption that the government will adequately represent the proposed intervenor. The presumption can only be overcome by “a strong affirmative showing” that the government “is not fairly representing the applicants’ interests.”

In contrast, four Circuits do not apply a presumption in such cases. See, e.g., Crossroads Grassroots Pol’y Strategies v. FEC, 788 F.3d 312, 321 (D.C. Cir. 2015). Relying heavily on the presumption in the proceedings below, the First Circuit ruled that Petitioners could not intervene as of right to advance constitutional arguments in support of an important Department of Education rule on Title IX that none of the existing parties are willing to make.

The question presented is whether a movant who seeks to intervene as of right on the same side as a governmental litigant must overcome a presumption of adequate representation.

The [First Circuit’s] presumption conflicts with Trbovich v. United Mine Workers of Am., 404 U.S. 528 (1972), which held that a movant who sought to intervene on the same side as a governmental litigant had only a “minimal burden” to establish inadequacy of representation. The presumption likewise lacks support in the text of Rule 24(a)(2), which employs conditional language suggesting that, where a movant is otherwise qualified to intervene, the question whether another party’s representation is “adequate” should rarely tip the scales against intervention.

Finally, the presumption obscures the frequent disconnect between the broad public interests represented by a government agency in litigation defending a law or legislative rule and the narrower interests represented by private litigants who would be adversely affected by invalidating that law or rule. As a result of the presumption, parties who otherwise qualify to intervene are left out of cases that threaten to impair or impede their interests—even when they can show that the existing parties’ interests are different than their own.

This case illustrates the particular importance of the circuit split over the application of Rule 24(a)(2). Petitioners are advocacy groups devoted to promoting free speech and due process on college campuses. They sought to intervene on the side of the Department to defend the culmination of a years-long rulemaking process—a key regulation mandating the most significant changes to administrative proceedings under Title IX in the history of that important statute.

Even though Petitioners represent comparatively narrow interests that are inconsistent with the broader interests of the Department, the First Circuit presumed the Department would adequately represent Petitioners and affirmed the denial of their motion to intervene. As a result, Petitioners were denied the ability to raise their proposed constitutional defenses of the Department’s Title IX Rule despite the fact that the Department refuses to raise those defenses, which conflict with the Department’s own interests in the litigation.

In contrast, in essentially identical litigation relying on essentially identical arguments in the United States District Court for the District of Columbia—where the presumption does not apply— Petitioners were allowed to permissively intervene alongside the Department. And Petitioners have a pending motion to intervene in another case challenging the Rule in the Northern District of California, which means that when all is said and done they will have been subjected to all three approaches that the courts of appeals take to adequacy of representation.

Petitioners are hardly alone. In the courts that apply the presumption, it often prevents similarly interested parties from participating in litigation over important issues and undercuts the general principle that intervention is favored. The Court should grant the writ in this case to provide much-needed guidance to the lower courts on a question that affects a wide variety of important cases.

Here’s more on the substantive question involved, though part of it is itself a substantive question about procedure. (Sometimes it feels like it’s procedure all the way down.)

Title IX prohibits education programs that receive federal financial assistance from discriminating on the basis of sex. Since nearly all colleges and universities in the United States receive federal funds, the interpretation and application of Title IX by the Department has sweeping importance for higher education.

On May 19, 2020, the Department published its Rule on Nondiscrimination on the Basis of Sex in Education Programs or Activities Receiving Federal Financial Assistance … to take effect on August 14, 2020. The Rule was the culmination of a comprehensive regulatory process during which the Department considered over 124,000 comments, hearing from those who had been victims of sexual assault and sexual harassment, those who had been accused, and thousands of others—schools, universities, educators, social workers, nonprofit groups, and concerned citizens. Petitioners were active participants in this administrative process.

The final Rule uses a definition of discriminatory “sexual harassment” that closely tracks this Court’s definition of that term in Davis v. County Board of Education, 526 U.S. 629 (1999). The final Rule defines “sexual harassment” to include “[u]nwelcome conduct determined by a reasonable person to be so severe, pervasive, and objectively offensive that it effectively denies a person equal access to the recipient’s education program or activity.” In Davis, this Court similarly held that “actionable” sexual harassment under Title IX must be “so severe, pervasive, and objectively offensive that it can be said to deprive the victims of access to the educational opportunities or benefits provided by the school.”

The Department’s adoption of the Davis standard was an important change of course for the agency. In its prior informal guidance, the Department had embraced a more expansive definition of discriminatory sexual harassment, defining it as conduct “sufficiently severe, persistent, or pervasive to limit a student’s ability to participate in or benefit from an education program or activity, or to create a hostile or abusive educational environment.” The former definition departed from the Davis standard by disjunctively listing the attributes of discriminatory harassment, ignoring the “objectively offensive” criterion, introducing the term “persistent,” and eschewing terms like “denial” or “deprivation” in favor of more amorphous terms like “limit.”

In another departure from the Department’s prior informal guidance, the Rule sets out a number of procedural protections for those accused of sexual misconduct. For instance, the Rule mandates that schools: (1) provide timely notice to respondents in sexual misconduct proceedings; (2) employ neutral, unbiased adjudicators; (3) objectively consider inculpatory and exculpatory evidence; and (4) afford complainants and respondents equal opportunities to gather and present evidence, to select advisors, and to appeal. In addition, postsecondary institutions must guarantee the accused a live hearing with the opportunity for cross-examination….

The Rule faced court challenges almost as soon as it was announced. In this case, plaintiffs sued in the U.S. District Court for Massachusetts, which had jurisdiction under 28 U.S.C. § 1331. Plaintiffs allege that the Rule’s use of the Davis standard to define “sexual harassment” and its additional procedural protections for the accused are unlawful under Title IX, the Administrative Procedure Act, and the Fifth Amendment’s equal protection guarantee. Among other relief, plaintiffs seek a court order that would compel the Department to replace the Davis standard with a more elastic definition of discriminatory sexual harassment—any “unwelcome conduct of a sexual nature.” Shortly after plaintiffs filed their amended complaint, Petitioners filed a motion to intervene as defendants.

Petitioners moved to intervene to protect their interests and to advance a legal theory that the Department of Education will not: that many of the Rule’s protections for college students are not just reasonable policy decisions—they are constitutionally required. Petitioners maintain and sought to argue as parties below that any definition of “sexual harassment” more expansive than the Davis standard would unconstitutionally infringe on First Amendment-protected speech—both directly and through its inevitable chilling effect. Further, Petitioners sought to argue that the Due Process Clause independently requires public colleges and universities to provide many of the same procedural protections now mandated by the Rule.

The Department has declined to take these legal positions. In the Rule’s Preamble, the Department maintained that applying the Davis standard was “consistent with the First Amendment,” not required by it. And the Department maintains that the Rule’s procedural protections “likely will meet constitutional due process obligations” and are “inspired by principles of due process,” but nevertheless are not required by constitutional due process. Consistent with those statements, throughout the litigation over the Rule, the Department has refused to defend the Rule on constitutional grounds.

Moreover, Petitioners’ interests are not coextensive with those of the Department. Petitioners are nonprofits that consistently advocate for narrowly defining “sexual harassment” under Davis to safeguard free expression and due process rights on college and university campuses. Thus, their interests lie in securing the greatest possible protection for those rights.

By contrast, the Department is a federal agency subject to all manner of legal and political forces. The Department thus must balance a host of interests with every action it takes. For instance, the Department noted one such balancing act in the Rule’s preamble by saying it explicitly sought to “balance protection from sexual harassment with protection of freedom of speech and expression.” …

Hugely important issues, both on the procedure and the substance.

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Charles Fried’s Hat and Sweater

Charles Fried is a law professor at Harvard, and served in several positions in the Reagan Administration, including as Solicitor General. During the debates over the Affordable Care Act, Fried made national headlines. He promised that if the Supreme Court invalidated Obamacare, he would eat his “kangaroo skin hat.” In Unprecedented, I noted that Fried actually found a chef who would bake a cake in the shape of his hat, just in case. Alas, due to the Chief Justice’s saving construction, Fried would never have to eat his hat. Now Fried is making another sartorial appeal to the Chief Justice.

Today, Fried published a guest essay in the New York Times titled “I Once Urged the Supreme Court to Overturn Roe. I’ve Changed My Mind.” Generally, authors do not get to pick their headlines. So it is difficult to determine whether Fried adopted this headline. Moreover, it isn’t clear what exactly he changed his mind about.

In Webster v. Reproductive Health Services, Fried argued that the Court should overrule Roe. At the time, he “did not see how the Constitution provides a principled basis for answering the question” of how to balance the “liberties of the pregnant woman” and “the life of another person, the fetus.” Fried adds that he was “personally agnostic on that issue.” I’ll admit, I don’t know many legal conservatives who are “personally agnostic” on abortion. Fried, who clerked for Justice Harlan when Poe v. Ullman was decided, also said that Harlan’s dissent provided “foundation of the law of privacy and personal dignity.” Again, I don’t know many legal conservatives who take the concept of “personal dignity” as a valid constitutional doctrine. (I am forever grateful I will never have to read another Anthony Kennedy decision extolling “dignity.”).

But something changed for Fried between 1989 and 1992. He writes:

In the 1992 case of Planned Parenthood of Southeastern Pennsylvania v. Casey, a joint opinion of Justices Sandra Day O’Connor, Anthony Kennedy and David Souter reaffirmed the central holding of Roe and put it on a firmer constitutional basis: the dignity and autonomy of the pregnant woman and the equal rights of women more generally.

Again, I do not know many legal conservative who thinks that Casey put Roe on a firmer constitutional basis. Dignity and autonomy are made-up constitutional values, just like emanations and penumbras. And Casey did not embrace the equal protection argument that Justice Ginsburg and others have advanced over the years. Instead, Casey adopted a method of stare decisis that was overtly political, and requires looking to public perception to decide the contours of constitutional law. Dissents from Chief Justice Rehnquist and Justice Scalia spell these arguments out in detail. I take it Fried disagrees with these two dissents, and stands with Souter.

Fried continues that Casey has formed the structure for other Supreme Court decisions, such as Lawrence v. Texas and Obergefell v. Hodges. (Both of those cases were 5-4, with the conservatives in sharp dissent). He writes that Casey “not only taken root; it has flourished and ramified.” Fried concludes that “[t]o overturn Roe now would be an act of constitutional vandalism — not conservative, but reactionary.”

I disagree. The original act of constitutional vandalism was Roe. To extend the metaphor, the Warren and Burger Courts were career criminals–arsonists, really–slashing and burning entire swaths of the Constitution to advance their ideal of a just society. The Casey plurality was an attempt to coverup to that vandalism–perhaps call them co-conspirators to the constitutional vandalism. Doubling down on that distortion in Dobbs would perpetuate those errors. Overruling Roe and Casey would be responsible, not reactionary. Stare decisis cannot mean “let the decisions of the Warren Court stand.”

Fried closes with another constitutional metaphor based on clothes, directed right at the Chief Justice:

When I argued Webster and made the case that overturning Roe would not undermine the broader foundation of privacy, I learned a lesson in the use of metaphor. Seeking to invoke my mentor John Harlan, I said I was not urging the unraveling of the whole fabric of substantive due process and unenumerated rights, but only to pull this one thread. To which my opponent replied that in his experience every time he pulled a thread on his sweater, the sleeve fell off.

In Webster, Fried offered these opening remarks:

Thank you Mr. Chief Justice and may it please the court. Today the United States asks this court to reconsider and overrule its decision in Roe v. Wade. At the outset, I would like to make quite clear how limited that submission is. First, we are not asking the Court to unravel the fabric of unenumerated and privacy rights which this court has woven in cases like Meyer and Pierce and Moore and Griswold. Rather, we are asking the Court to pull this one thread.

His opposing counsel, Frank Susman, offered this rejoinder:

Mr. Chief Justice, and may it please the court, I think the Solicitor General’s submission is somewhat disingenuous when he suggests to this court that he does not seek to unravel the whole cloth of procreational rights, but merely to pull a thread. It has always been my personal experience that when I pull a thread, my sleeve falls off. There is no stopping. It is not a thread he is after. It is the full range of procreational rights and choices that constitute the fundamental right that has been recognized by this court. For better or for worse, there no longer exists any bright line between the fundamental right that was established in Griswold and the fundamental right of abortion that was established in Roe.

Fried may still be smarting, three decades later, from being called “disingenuous.”

But the admonition is wrong. In light of the Glucksberg framework, Meyer and Pierce are safe. The rights of parents to direct the upbringing of their children are deeply rooted in our nation’s history and traditions. Moreover, I recently asked several social conservatives what they would think if Meyer and Pierce were jettisoned along with Roe. The answer was overwhelmingly positive. Indeed, today those cases are largely recast as First Amendment cases, so they have little separate value as substantive due process decisions.

Ultimately, I think Attorney General Meese offers a far more representative account of how legal conservatives–especially those from the Reagan Revolution–view Dobbs.

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Rabobank: Brushing Up Our Greek Alphabets

Rabobank: Brushing Up Our Greek Alphabets

By Michael Every of Rabobank

Brushing up our Greek alphabets

After a ‘sell first, ask questions later’ Friday, markets regained some confidence on Monday. News that Omicron may lead to relatively mild symptoms may have helped the mood, though much about the new strain still remains unclear, including how infectious it is compared to other variants and whether it requires updated vaccines. The health ministers of the G7 issued a joint statement that contained little new information on the strain, but did warn that it “requires urgent action”. European equities also defied news that Germany is now the next country to consider stricter measures to curb the rise in cases.

The risk-on tone weighed on fixed income, with 10y Bund yields rising 2bp on the day, though that reverses only part of Friday’s decline. And the German inflation numbers didn’t provide much support for Bunds either. High inflation was already expected, with a 5.5% consensus forecast. Nevertheless, the German HICP managed to surpass that, as prices rose 6.0% y/y in November. With similar inflation rates already observed in other European countries, including Spain (5.6%) and Belgium (5.6%), a high Eurozone-aggregate HICP today shouldn’t come as a surprise.

In addition to German inflation being higher than expected, it was also a bit more broad-based: certainly, energy was an important contributor, but clothing, furnishing and household equipment, and particularly recreation and culture -though notably a volatile component- also drove prices higher. Despite the wider base of inflationary pressures, that doesn’t take away from the fact that most of these effects are probably still temporary factors that result from the reopening of the economy, supply chain disruptions, and the changes to German VAT at the start of the year. Indeed, the Bundesbank had already warned for a near-6% inflation rate this month, and the ECB’s Isabel Schnabel stated in a TV interview that “November will prove to be the peak.”

Nikkei reported some reassuring news to that extent, noting that the supply chain disruptions in the auto sector are starting to ease. According to the newspaper, the global supply of chips used in the auto industry may finally be improving: “after months of shortages, inventories have risen for the first time in nine months.” While it may still take some time before shortages across the entire supply chain are resolved, this does suggest that some bottlenecks are indeed gradually easing, boding well for both price pressures and for the output of one of Germany’s key industries. That said, bear in mind that the chip shortages were at the forefront of the global disruptions; since then shortages in many other materials and sectors have followed.

The rebound in China’s manufacturing PMI may also offer some reassurance about the recovery of the global value chain. The headline recovered to an expansionary reading of 50.1, but this may understate the improvements in actual output, seeing that one of the main drags on this headline relates to a sharp decline in energy prices faced by manufacturers. This likely reflects the government’s interventions in the coal sector, boosting production. Bloomberg reports that the National Development and Reform Commission met with coal producers last week and that prices would have to be guided towards to a “reasonable range”.

That is, of course, assuming that omicron does not throw a spanner in the works here. It certainly does make central bankers’ jobs that bit harder again. Fed Chair Powell said yesterday that the new strain, as well as the general rise in Covid-19 cases, poses downside risks to the full employment mandate and adds uncertainty to the inflation outlook. While he didn’t specifically mention any implications for the Fed’s current policy trajectory, it adds to the markets’ doubts whether the FOMC will still decide to accelerate the pace of tapering in its December meeting, and whether the market wasn’t too aggressive in its pricing of rate hikes next year. EUR/USD continues to find some support in this revaluation of potential for US policy moves.

Certainly, uncertainty also clouds the ECB’s decisive December meeting. However, with a more dovish starting point, that is less of a marked change. If anything, the European Central Bank may want to commit less in December, leaving more options open for earlier in the year when the Governing Council has more clarity on the outlook and omicron’s impact. A key case in point are Vice President De Guindos’ remarks on the TLTRO-IIIs this morning: he is clear that “the TLTROs are not finished yet”, confirming that -in his view- this year’s long-term liquidity providing operations certainly weren’t the last. However, he added that “it’s not going to be a decision we discuss in December”. Assuming that the future of (or rather after) PEPP will still be decided in December, that does put much more weight on the few other tools the ECB could use to mitigate the expected end of pandemic purchases. This could set markets up for an initial disappointment.

Tyler Durden
Tue, 11/30/2021 – 10:45

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When Does Government “Fairly Represent” Public Interest Groups’ Views, Thus Barring Them from Intervening?

As I like to say, the lawyer’s true superpower is to turn every question into a question about procedure. But there’s a good reason for that: Sound procedural rules are critical to a just and efficient decision on the substance. (Unsound procedural rules, of course, are also important, though in a bad way.)

One particularly important procedural rule has to do with when parties, including public interest groups, can intervene in a case—and, in particular, when they can intervene when a government party is saying “no need, we’ve got this” and the groups are saying “no you don’t.” This has come up most recently with the Foundation for Individual Rights in Education’s attempt to make important constitutional arguments in a Title IX case, but the issue comes up more broadly. Here’s how FIRE puts it in its cert. petition in FIRE v. Victim Rights Law Center, which the Court is scheduled to consider Friday:

Under Federal Rule of Civil Procedure 24(a)(2), an entity that seeks to intervene as of right must establish that none of the existing parties “adequately represent” its interests. In cases in which someone seeks to intervene on the side of a governmental entity, the First Circuit and several other courts of appeals apply a presumption that the government will adequately represent the proposed intervenor. The presumption can only be overcome by “a strong affirmative showing” that the government “is not fairly representing the applicants’ interests.”

In contrast, four Circuits do not apply a presumption in such cases. See, e.g., Crossroads Grassroots Pol’y Strategies v. FEC, 788 F.3d 312, 321 (D.C. Cir. 2015). Relying heavily on the presumption in the proceedings below, the First Circuit ruled that Petitioners could not intervene as of right to advance constitutional arguments in support of an important Department of Education rule on Title IX that none of the existing parties are willing to make.

The question presented is whether a movant who seeks to intervene as of right on the same side as a governmental litigant must overcome a presumption of adequate representation.

The [First Circuit’s] presumption conflicts with Trbovich v. United Mine Workers of Am., 404 U.S. 528 (1972), which held that a movant who sought to intervene on the same side as a governmental litigant had only a “minimal burden” to establish inadequacy of representation. The presumption likewise lacks support in the text of Rule 24(a)(2), which employs conditional language suggesting that, where a movant is otherwise qualified to intervene, the question whether another party’s representation is “adequate” should rarely tip the scales against intervention.

Finally, the presumption obscures the frequent disconnect between the broad public interests represented by a government agency in litigation defending a law or legislative rule and the narrower interests represented by private litigants who would be adversely affected by invalidating that law or rule. As a result of the presumption, parties who otherwise qualify to intervene are left out of cases that threaten to impair or impede their interests—even when they can show that the existing parties’ interests are different than their own.

This case illustrates the particular importance of the circuit split over the application of Rule 24(a)(2). Petitioners are advocacy groups devoted to promoting free speech and due process on college campuses. They sought to intervene on the side of the Department to defend the culmination of a years-long rulemaking process—a key regulation mandating the most significant changes to administrative proceedings under Title IX in the history of that important statute.

Even though Petitioners represent comparatively narrow interests that are inconsistent with the broader interests of the Department, the First Circuit presumed the Department would adequately represent Petitioners and affirmed the denial of their motion to intervene. As a result, Petitioners were denied the ability to raise their proposed constitutional defenses of the Department’s Title IX Rule despite the fact that the Department refuses to raise those defenses, which conflict with the Department’s own interests in the litigation.

In contrast, in essentially identical litigation relying on essentially identical arguments in the United States District Court for the District of Columbia—where the presumption does not apply— Petitioners were allowed to permissively intervene alongside the Department. And Petitioners have a pending motion to intervene in another case challenging the Rule in the Northern District of California, which means that when all is said and done they will have been subjected to all three approaches that the courts of appeals take to adequacy of representation.

Petitioners are hardly alone. In the courts that apply the presumption, it often prevents similarly interested parties from participating in litigation over important issues and undercuts the general principle that intervention is favored. The Court should grant the writ in this case to provide much-needed guidance to the lower courts on a question that affects a wide variety of important cases.

Here’s more on the substantive question involved, though part of it is itself a substantive question about procedure. (Sometimes it feels like it’s procedure all the way down.)

Title IX prohibits education programs that receive federal financial assistance from discriminating on the basis of sex. Since nearly all colleges and universities in the United States receive federal funds, the interpretation and application of Title IX by the Department has sweeping importance for higher education.

On May 19, 2020, the Department published its Rule on Nondiscrimination on the Basis of Sex in Education Programs or Activities Receiving Federal Financial Assistance … to take effect on August 14, 2020. The Rule was the culmination of a comprehensive regulatory process during which the Department considered over 124,000 comments, hearing from those who had been victims of sexual assault and sexual harassment, those who had been accused, and thousands of others—schools, universities, educators, social workers, nonprofit groups, and concerned citizens. Petitioners were active participants in this administrative process.

The final Rule uses a definition of discriminatory “sexual harassment” that closely tracks this Court’s definition of that term in Davis v. County Board of Education, 526 U.S. 629 (1999). The final Rule defines “sexual harassment” to include “[u]nwelcome conduct determined by a reasonable person to be so severe, pervasive, and objectively offensive that it effectively denies a person equal access to the recipient’s education program or activity.” In Davis, this Court similarly held that “actionable” sexual harassment under Title IX must be “so severe, pervasive, and objectively offensive that it can be said to deprive the victims of access to the educational opportunities or benefits provided by the school.”

The Department’s adoption of the Davis standard was an important change of course for the agency. In its prior informal guidance, the Department had embraced a more expansive definition of discriminatory sexual harassment, defining it as conduct “sufficiently severe, persistent, or pervasive to limit a student’s ability to participate in or benefit from an education program or activity, or to create a hostile or abusive educational environment.” The former definition departed from the Davis standard by disjunctively listing the attributes of discriminatory harassment, ignoring the “objectively offensive” criterion, introducing the term “persistent,” and eschewing terms like “denial” or “deprivation” in favor of more amorphous terms like “limit.”

In another departure from the Department’s prior informal guidance, the Rule sets out a number of procedural protections for those accused of sexual misconduct. For instance, the Rule mandates that schools: (1) provide timely notice to respondents in sexual misconduct proceedings; (2) employ neutral, unbiased adjudicators; (3) objectively consider inculpatory and exculpatory evidence; and (4) afford complainants and respondents equal opportunities to gather and present evidence, to select advisors, and to appeal. In addition, postsecondary institutions must guarantee the accused a live hearing with the opportunity for cross-examination….

The Rule faced court challenges almost as soon as it was announced. In this case, plaintiffs sued in the U.S. District Court for Massachusetts, which had jurisdiction under 28 U.S.C. § 1331. Plaintiffs allege that the Rule’s use of the Davis standard to define “sexual harassment” and its additional procedural protections for the accused are unlawful under Title IX, the Administrative Procedure Act, and the Fifth Amendment’s equal protection guarantee. Among other relief, plaintiffs seek a court order that would compel the Department to replace the Davis standard with a more elastic definition of discriminatory sexual harassment—any “unwelcome conduct of a sexual nature.” Shortly after plaintiffs filed their amended complaint, Petitioners filed a motion to intervene as defendants.

Petitioners moved to intervene to protect their interests and to advance a legal theory that the Department of Education will not: that many of the Rule’s protections for college students are not just reasonable policy decisions—they are constitutionally required. Petitioners maintain and sought to argue as parties below that any definition of “sexual harassment” more expansive than the Davis standard would unconstitutionally infringe on First Amendment-protected speech—both directly and through its inevitable chilling effect. Further, Petitioners sought to argue that the Due Process Clause independently requires public colleges and universities to provide many of the same procedural protections now mandated by the Rule.

The Department has declined to take these legal positions. In the Rule’s Preamble, the Department maintained that applying the Davis standard was “consistent with the First Amendment,” not required by it. And the Department maintains that the Rule’s procedural protections “likely will meet constitutional due process obligations” and are “inspired by principles of due process,” but nevertheless are not required by constitutional due process. Consistent with those statements, throughout the litigation over the Rule, the Department has refused to defend the Rule on constitutional grounds.

Moreover, Petitioners’ interests are not coextensive with those of the Department. Petitioners are nonprofits that consistently advocate for narrowly defining “sexual harassment” under Davis to safeguard free expression and due process rights on college and university campuses. Thus, their interests lie in securing the greatest possible protection for those rights.

By contrast, the Department is a federal agency subject to all manner of legal and political forces. The Department thus must balance a host of interests with every action it takes. For instance, the Department noted one such balancing act in the Rule’s preamble by saying it explicitly sought to “balance protection from sexual harassment with protection of freedom of speech and expression.” …

Hugely important issues, both on the procedure and the substance.

The post When Does Government "Fairly Represent" Public Interest Groups' Views, Thus Barring Them from Intervening? appeared first on Reason.com.

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Biden Considering CFPB Director Cordray As Fed Vice Chair For Banking Supervision

Biden Considering CFPB Director Cordray As Fed Vice Chair For Banking Supervision

It appears that for the White House, regulating consumer finance (i.e., complaints about credit card rates) and regulating bank holding companies, shadow banks and hedge funds is more or less the same because moments ago the WSJ reported that President Biden is considering Richard Cordray, the first director of the Consumer Financial Protection Bureau, to serve as the Fed’s top banking regulator, citing people familiar with the matter.

If nominated and confirmed by the Senate, Cordray would become the government’s most influential overseer of the American banking system, succeeding the outgoing Randal Quarles as the Fed’s vice chairman of banking supervision.

Cordray, who is an attorney, served as head of the CFPB from 2012 to 2017 under Obama, a watchdog post created by Congress after the 2008 financial crisis to regulate lenders and other companies tied to consumer finance.

He is currently a top official at the Department of Education, serving as the chief operating officer of Federal Student Aid, overseeing the $1.6 trillion student-loan program. And since he will have virtually no knowledge of what he will be regulating over at the Fed, he should fit right in.

Tyler Durden
Tue, 11/30/2021 – 10:30

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

Conference Board Confidence Slumps In November As Hope Nears 5-Year-Low

Conference Board Confidence Slumps In November As Hope Nears 5-Year-Low

Having ramped back up to pre-COVID levels in June, Conference Board Consumer Confidence has drifted broadly lower since, and analysts expected November to show a renewed downturn after a brief surprise upturn in October and they were right as the headline confidence printed 109.5, below expectations of 110.9 and down from 113.8 in October. Both Present Situation (142.5) and Expectations (87.6) both tumbled…

Source: Bloomberg

That is the lowest headline confidence since February and expectations are hovering at their lowest since 2016.

The Labor differential (Jobs Plentiful – Jobs Hard to Get) surged to a new record high…

Finally, we wonder just who the survey respondents are? The massive divergence between The Conference Board’s headline sentiment index and University of Michigan’s is stunning… and unique in the two indices’ forty-plus years…

Source: Bloomberg

Choose your confidence indicator wisely.

Tyler Durden
Tue, 11/30/2021 – 10:05

via ZeroHedge News https://ift.tt/3p8aoay Tyler Durden

The New Omicron Variant Is Sparking Demand for the Same Old COVID-19 Restrictions


reason-mask3

A new COVID-19 variant is sparking calls for the same old pandemic restrictions and mandates. It’s been less than a week since the World Health Organization (WHO) labeled the omicron variant of the virus, first identified in South Africa, as a “variant of concern.” Politicians and public health officials have snapped into action with advice—and requirements—to mask up and vaccinate.

On Monday, New York Mayor Bill de Blasio urged even fully vaccinated New Yorkers to return to wearing masks indoors.

“It’s time to remind people and double down and say, ‘Even if you started to move away from masks before, we’re telling you to get those masks back on now,'” the mayor said at a press conference.

An advisory issued by New York City’s health commissioner urges, but doesn’t require, people to wear masks in building lobbies, offices, and retail stores.

De Blasio also expanded the city’s vaccine mandate to include all staff at city-funded day cares, which the Post reports covers about 102,000 workers.

National Institute of Health Director Francis Collins has issued similar advice at the national level, telling CNN‘s Dana Bash on Sunday that people should continue to wear masks when indoors around the unvaccinated and continue to socially distance.

“We have to use every kind of tool in our toolbox to keep [Omicron] from getting in a situation that makes this worse,” he said.

Over in the U.K., masks are once again being required in most public settings in England, a measure Prime Minister Boris Johnson said would “buy us time in the face of this new variant.”

President Joe Biden has already issued a travel ban for non-citizens and non–permanent residents coming from South Africa and a number of other southern African nations.

That provoked some mild criticism from the WHO, which has historically been critical of travel bans to fight pandemics. Other critics have lambasted Biden for being too timid.

New York Times columnist Zeynep Tufecki has called for travel to be restricted from any countries where the omicron variant is known to be spreading, and for those restrictions to apply to U.S. citizens as well. She also recommended stricter testing and quarantine requirements for inbound passengers.

Meanwhile in The Washington Post, Leana Wen, a public health professor at George Washington University, similarly recommended a quarantine and testing regime for all international travelers. She also urged the Biden administration to impose a vaccine mandate for domestic air travel and interstate train travel, and for localities to bring back mask mandates.

Biden on Monday urged people get vaccinated, get a booster shot, and mask up. So long as people did those things, “there is no need for the lockdown” he announced.

The president said that he was also working closely with pharmaceutical companies Pfizer, Moderna, and Johnson & Johnson to swiftly approve and rollout a modified vaccine if necessary.

Vaccines have been the most effective tool for protecting people from the worst consequences of COVID-19 thus far. Hopefully, they will remain effective or can be easily modified to fight the omicron variant.

In a Tuesday-published interview with the Financial Times, Moderna’s CEO said there will likely be a “material drop” in current vaccines’ effectiveness.

Everything else that politicians are currently doing, from masking to porous travel bans, feels like so much political theater. It’s a well-worn script that officials are apparently committed to following every time a new COVID variant pops into existence.


REASON WEBATHON

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FREE MINDS

People who are upset that Kyle Rittenhouse isn’t going to prison are also pretty steamed that he’s going to college. Rittenhouse recently told Fox News host Tucker Carlson that he would like to attend Arizona State University (ASU) soon. That’s not sitting well with a coalition of left-wing student groups at the school, who have demanded that Rittenhouse—who was recently acquitted of multiple charges related to his shooting of three people in Kenosha, Wisconsin—be barred from attending.

“Even with a not-guilty verdict from a flawed ‘justice’ system, Kyle Rittenhouse is still guilty to his victims and the family of those victims,” the coalition declared in a statement posted on Friday, according to the Washington Examiner. “Join us to demand from ASU that those demands be met to protect students from a blood-thirsty murderer.”

ASU, for its part, says that Rittenhouse is currently not enrolled in any classes.


FREE MARKETS

The African nation of Senegal’s ban on single-use plastic products is producing a backlash. In January 2020, the Senegalese government announced a plastic ban. A grace period during the pandemic is now coming to an end, so the prohibition will now start to be enforced.

Bloomberg CityLab reports that this isn’t sitting well with Sengalese merchants, many of them women, who sell clean drinking water in now-banned plastic sachets:

the new rule has drawn attention to another problem: access to clean drinking water and the women who make a living filtering, packaging and re-selling tap water in plastic bags across Senegal’s biggest cities. An estimated 30,000 jobs are at risk, according to the Collective of Filtered Water Actors (CAES), a union that represents the industry’s manufacturers and sellers….

Women and girls took to the streets in Dakar at the beginning of September to protest the ban. Their business thrives on the demand for inexpensive water in the Sahelian climate. One 14-year-old reseller said she can buy a pack of multiple sachets for 750 CFA francs and sell it for 1,500 CFA francs.


QUICK HITS

  • A bill introduced in the New Jersey Legislature would make it harder for local governments to ban the construction of accessory dwelling units, or granny flats. Similar reforms in California have produced a substantial amount of new housing.
  • Rep. Lauren Boebert (R–Co.) made some pretty bigoted remarks remarks about Rep. Ilhan Omar (D–Minn.). A phone call meant to patch things up has done the opposite.
  • CNN anchor Chris Cuomo is under fire again for advising his brother, former New York Gov. Andrew Cuomo, on how to respond to the sexual harassment allegations that eventually led to his resignation earlier this year.
  • Oakland pot merchants are asking for tax relief after a string of burglaries.
  • Stocks are slumping in response to concerns about the new omicron variant.
  • Merriam-Webster has picked “vaccine” as the word of the year.

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