John Cleese’s War on Wokeism


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From shows and movies ranging from Monty Python’s Flying Circus and Fawlty Towers to Life of Brian and A Fish Called Wanda, the comedian John Cleese has uproariously and relentlessly satirized politics and religion while stretching the boundaries of decorum and good taste like so many silly walks.

Now 82, Cleese—who studied law at Cambridge—has recently set his sights on political correctness and wokeism, which he says are the enemy not only of humor but of creative thinking in all areas of human activity.

He appeared at FreedomFest, the annual July gathering of libertarians in Las Vegas, to discuss creativity, the subject of his 2020 “short and cheerful guide.” After giving a talk on the attitudes and habits he believes are necessary for creativity to 2,500 attendees, Reason‘s Nick Gillespie interviewed Cleese about the importance of freedom of thought and expression for a flourishing society.

Photos: Mirrorpix / MEGA / Newscom/ASLON2/Newscom; PYTHON PICTURES/EMI / Album/Newscom; Original Memorabilia Company / Pacific Coast News/Newscom; Everett Collection/Newscom; D Soto imageSPACE / Splash News/Newscom; Andrew Matthews/ZUMA Press/Newscom; UNIVERSAL STUDIOS / Album/Newscom; Hosie, Andy/Mirrorpix/Newscom; Staff/Mirrorpix/Newscom; NCJ/Mirrorpix/Newscom; Splash News/Newscom; Mirrorpix/Newscom

Music: John Philip Sousa’s “The Liberty Bell” (1893) as performed by the United States Marine Band

The post John Cleese's War on Wokeism appeared first on Reason.com.

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Despite Narrowing Polls, Model Suggests Midterm Misery For Dems

Despite Narrowing Polls, Model Suggests Midterm Misery For Dems

The last week has seen something odd happening in political polls.

Despite a narrative of a red wave in the Midterms, several polls and betting sites have shifted to a considerably tighter race than many expect given the utter disaster that has befallen the average American over the past two years.

According to RealClearPolitics ‘Generic Congressional Vote’ aggregate survey index, the gap between Republicans and Democrats has narrowed significantly in the last week…

With regard the Senate, PredictIt has seen the odds of Republican control tumble in the last week…

Republican control of the House and the Senate remains the most expected outcome, but is trading at just 52% currently (dramatically lower than the 75% odds in mid-June)…

This change in trend is occurring as President Biden’s approval rating remains mired near record lows…

Source: Bloomberg

So what is going on? Are Soros’ minions pushing PredictIt around? Did the ‘Inflation Reduction Act’ really offer hope to Dems?

It’s unclear, and of course, polls are fickle. But, as Bloomberg notes, the state of the economy looms large in any US election and historically that spells big trouble for Democrats in November’s midterm vote.

A new study by Bloomberg Economics takes one gauge with a knack of predicting ballot outcomes – the misery index, calculated by adding up the inflation and unemployment rates — and projects it forward through election day.

Source: Bloomberg

The result: Based on past voting patterns, President Joe Biden’s party can expect to lose 30 to 40 seats in the House and a few in the Senate too, easily wiping out razor-thin Democratic majorities.

Democrats are hoping that that anger over abortion and gun laws and the Jan. 6, 2021 riots, but consensus remains that the left faces a significantly uphill battle.

“It’s very difficult to interpret economic numbers right now,” says Larry Bartels of Vanderbilt University.

“In the 2020 presidential election, the huge run-up in income due to the pandemic stimulus implied a Trump landslide, whereas the huge decline in GDP implied a wipe-out. Obviously, the truth was somewhere in between.”

Bear in mind that historically, since the Civil War, the party of the incumbent president has lost an average of 33 seats in mid-cycle house elections.

Additionally, the state-level numbers also make gloomy reading for Democrats. Some key battlegrounds like Ohio and Nevada have misery indexes higher than the national version.

“When everyone is affected,” says Frank Luntz, the pollster, “the electoral impact is compounded.”

Finally, as a reminder, Americans’ Consumer Sentiment has never been worse (UMich) and our ‘adjusted’ Misery Index (avoids the fitting of BLS payrolls data and utilizes labor force participation rates) shows Americans suffering most since Jimmy Carter was president…

Source: Bloomberg

“The reason why the misery index still matters is that it’s really genuine misery for so many Americans,” Luntz says.

“Food and fuel inflation is so high and so universal, and impacts every voter in every community in every state.”

So what do you believe America? Suddenly diving poll data or historical precedent and real world misery?

Tyler Durden
Mon, 08/01/2022 – 11:05

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Rabobank: If Pelosi Now Chickens Out And Doesn’t Go To Taiwan, China Will Have Proven It Controls Access To It

Rabobank: If Pelosi Now Chickens Out And Doesn’t Go To Taiwan, China Will Have Proven It Controls Access To It

By Michael Every of Rabobank

Of all the things I expected to be doing on a Sunday night as I caught up with the world after a break from markets, watching Twitter playing ‘Where’s Nancy?’ was not one of them. Yet thousands tracked the US Speaker of the House of Representatives heading off as she tweeted, “I’m leading a Congressional delegation to the Indo-Pacific to reaffirm America’s unshakeable commitment to our allies & friends in the region. In Singapore, Malaysia, South Korea & Japan, we’ll hold high-level meetings to discuss how we can further our shared interests & values.” The rumor is she may also appear in Taiwan later this week.

This Nancy Drew Mystery is all over Bloomberg and the Financial Times because China has made clear it will respond if Pelosi does ‘go there’. Indeed, just days after Xi told President Biden that on Taiwan, “those who play with fire will get burned”, the Global Times says “Don’t say we didn’t warn you!“, and the PLA says they are “Preparing for war,” to public approval. Moreover, a missive titled ‘Red Clouds of War Looming Over Taiwan’ doing the rounds among expats in Taiwan (by a De Groot, but not the one in my team), stresses:

“It’s what we’ve all been dreading for years, a massive military attack by an aggressive, repressive, authoritarian China. One minute, we’re peacefully going about our business in this free, democratic, and basically humane country, Taiwan. The next, life is turned upside down. Bombs are dropped and missiles launched, causing death and destruction to people, property – and maybe the entire Taiwan dream. It’s a nightmare scenario both for native-born Taiwanese and for expats who love their adopted home, like waking up to find that the monster has finally crawled out from under your bed.

Terrifying, yes. And also damned inconvenient. If China did attack, the internet would almost certainly be cut off, as well as much of the infrastructure we take for granted. Phone service, electricity, and even water services might be problematic. Food could soon run out, and access to medical services, fire fighters, the justice system, and banking all severely curtailed. Life as we had known it would be over, perhaps even literally over for people living too near a military target. Even those far from the battle zones would be seriously impacted.

But could an attack possibly happen? Will it actually happen? And if so, when and how?”

The article points out the only meteorological windows for a sea attack are October and April and summarizes five logical scenarios:

  1. a minimalist seizure of outlying islands closer to the mainland;

  2. hybrid warfare to interfere with the economy;

  3. a serious attack but no invasion;

  4. a proper invasion;

  5. flattening Taiwan without invading it.

It thinks #3 is most likely. Some others think #1 or #2. Those thinking ‘none of the above’ should note defense analyst @tshugart3 says three of China’s largest/newest roll-on/roll-off civilian ferries appear to be off their normal routes and are in or have moved south toward the Taiwan Strait – and he is the author of a detailed article on how China has long prepared to use civilian maritime logistics against Taiwan. 

This Daily doesn’t know if Nancy Pelosi went long or short the Vix in flight. However, we are not surprised that we are now where we are – heading towards a high-risk, no-win scenario.

The flailing US –where President Biden has Covid (again) and is in one technical definition of recession– can’t back down as it tries to rebuild its leading role in Asia: if Pelosi doesn’t go to Taiwan, China will have ‘proven’ that it is able to control access to it, a red line which it would from then on likely enforce.

Neither can flailing China back down without losing face ahead of the looming Party Congress: indeed, it is going all in in other regards, e.g., trying to buy a strategic port in the Solomons; and, as its manufacturing PMI dips back below 50 again and the Caixin reading back to 50.4, may seize undeveloped land from property developers. Moreover, it knows that the US has just had to ground its F-35 fleet due to a safety issue. This kind of stand-off, and screw-up, is historically how major wars can start.

The mystery is not where Nancy is, but how the market thinks it will be able to say Nancy ‘drew’ when it is a zero-sum dynamic.

Pretending pressures are not building makes as little sense as it did when ignoring what Putin was doing on the border of Ukraine earlier this year – recall we warned back in January that war over Ukraine was far more likely than markets thought. The problem is that Taiwan and China implies disruption on a scale that would dwarf anything seen so far over Ukraine (where the EU is backing off of its planned oil/insurance sanctions, and Ukraine is stepping up its physical attacks on Russia). Thus the denialism.

Let’s also stress that it’s no mystery at all how we got to this latest crisis. We have warned for years that: globalization doesn’t deliver for enough people; not everyone who globalized shared the US world vision; global debt is too high; QE only makes rich people richer; inequality is ripping societies apart; we are living in a Lalaland of asset bubbles; populism is growing (just look at Italy’s opinion polls); China is also in deep structural trouble; the historical path is rising debt > bubbles > crisis > FX wars > trade wars > hot wars; a Great Power fragmented world order would re-emerge; fascism and communism would be back (and we can add imperialism); food prices would soar; so would energy prices (as the Wall Street Journal warns ‘Energy Prices May Keep Inflation High for Years’); industrial supply chains and logistics matter (and we remain ‘In Deep Ship’ as US port backlogs soar again); inflation isn’t transitory (as the June US PCE deflator was 0.6% m-o-m, 6.8% y-o-y, and 0.6% m-o-m, 4.8% y-o-y core); global interest rates would have to rise sharply; and the US dollar was the only game in town. I will throw in that we also said rates could rise AND some form of QE/MMT happen anyway, perhaps to pay for military spending – and Europe is now doing exactly that kind of thing.

To draw a market parallel, this Pelosi stand-off is similar to the zero-sum dynamic behind the central bank rates response to inflation, which was “They can’t raise rates!” vs. “They can’t not raise rates.” There was never a middle ground ‘draw’ to aim for – and which side won that zero-sum?

Yet even as the Fed dropped its forward guidance, while suggesting it could go forward in very large steps if needed, the market seized on suggestions that rate hikes could also slow, which “means” US rates will then start to fall sharply in 2023. Indeed, while July saw the Fed Funds rate rise 75bps to 2.50%, stocks were up 8-10%, bond yields distinctly lower, high yield spreads tighter by around 100bps, and the key US 30-year mortgage rate around 60bps lower.

More wealth effects. More inequality. Higher commodity prices. More strain on the global economic system. More failing supply chains, and food and energy crises. More strain on the global security system that has led us to Russia-Ukraine, China-Taiwan (and US-Iran and Serbia/Kosovo?).

And perhaps more strain on central banks, who don’t want to see any of this happening because it will mean they have to do even more on rates to reverse it. Unless they do want to see it happening, in which case we are in an even bigger mess than some think we are. But if they don’t, then market expectations of rate cuts in 2023 are likely to be as accurate as expectations of no rate hikes in 2022 were. And as expectations are that all will end well with this mystery over where Nancy is or isn’t.

Tyler Durden
Mon, 08/01/2022 – 10:45

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First Grain-Laden Ship Safely Departs Ukraine’s Odessa Port

First Grain-Laden Ship Safely Departs Ukraine’s Odessa Port

Turkey has confirmed that the first shipment of Ukraine grain has left the port of Odessa, after six months of war-time blockages, under the UN-brokered deal to secure safe passage of grain ships signed by Moscow and Kiev last month.

“The ship Razoni has left the port of Odessa bound for Tripoli in Lebanon. It is expected in Istanbul on August 2. It will then continue its journey after it has been inspected in Istanbul,” a Turkish Defense Ministry statement said.

Via AFP

The Kremlin also hailed the success based on the terms laid out in Isanbul: “As for the departure of the first ship, this is very positive. A good opportunity to test the effectiveness of the mechanisms that were agreed during talks in Istanbul,” Dmitry Peskov told reporters.

According to Ukrainian officials the 186-meter long Sierra Leone-flagged Razoni cargo ship is laden with 26,000 tonnes of corn, and is expected to soon be followed by other ships.

The deal was signed on July 22 – with UN Secretary General Antonio Guterres having hailed it as a “beacon of hope” after previously estimating that some 50 million people are facing “acute hunger” due to one of the biggest single global exporters of wheat. “Ensuring that existing grain and foodstuffs can move to global markets is a humanitarian imperative,” Guterres said more recently.

Following the two warring sides signing “mirror” agreements with the United Nations, it took less than a week to get the joint coordination center based in Istanbul up and running. The coordination center, staffed by Russian, Ukrainian, Turkish, and UN officials is tasked to “oversee departures from the ports of Odessa, Chernomorsk and Yuzhny, in which ships must circumvent mines, and will conduct inspections of incoming ships for weapons,” Turkish media has described, noting too that all vessels must traverse Turkish waters.

Media estimates have commonly indicated that some 20 million tons of grain, largely from last year’s harvest, have been “held hostage” and are piling up at blockaded ports.

The New York Times writes in a recent report on the crisis, “But despite fanfare in Brussels and Washington, the accord is being greeted cautiously in the fields of Ukraine. Farmers who have lived for months under the risk of Russian missile attacks and economic uncertainty are skeptical that a deal will hold.”

And more from the report:

“The opening of the Black Sea ports is not by itself the magic answer,” said Georg von Nolcken, chief executive of Continental Farmers Group, a large agro-business with vast tracts around western Ukraine. “It’s definitely a step forward, but we can’t assume that the deal will bring Ukraine back to where it was” before the war,” he said.

The blockage has ignited wild price swings for crops and the cost of transporting them. Storage is running out for the latest harvests, leaving many scrambling for makeshift solutions.

The grain blockage from what’s been dubbed the world’s breadbasket saw a global spike in food prices which made the ability of poorer nations to continue imports an immense challenge. Moscow has tended to blame Ukraine for the crisis, after its military mined the ports.

Ukrainian officials have lately voiced concerns that Russia may be looking to ‘sabotage’ the deal – for example, by missile strikes on ports and infrastructure crucial to commodities exports. More ships are said to be waiting to leave.

Tyler Durden
Mon, 08/01/2022 – 10:30

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Port Of LA Fends Off 40 Million Cyber Attacks Each Month: Director

Port Of LA Fends Off 40 Million Cyber Attacks Each Month: Director

Authored by Jill McLaughlin via The Epoch Times,

The number of cyber intrusions directed at the Port of Los Angeles has doubled since the beginning of the COVID-19 pandemic, reaching 40 million each month, according to Executive Director Gene Seroka.

Intelligence shows the threats are coming from Russia and parts of Europe, Seroka told BBC July 22.

“We have to stay steps ahead of those who want to hurt international commerce,” he said.

A view of The Port of Los Angeles from San Pedro, Calif., on Oct. 14, 2021. (John Fredricks/The Epoch Times)

The cyber intrusions include phishing, malware, and other attempts to breach the port’s systems.

“The past two years have proven the vital role that ports hold to our nation’s critical infrastructure, supply chains and economy. It’s paramount we keep the systems as secure as possible,” Seroka said.

In response to the increase in cyber threats, the port launched a first-of-its-kind Cyber Resilience Center in January to improve readiness. The system is operated by International Business Machines (IBM) to allow the port and outside companies involved in the supply chain to collect and share signs of threats with each other automatically.

“We’ve gone from the cybersecurity Operations Center to a Cyber Resilience Center, which for the first time brings the private sector in under the FBI’s [cyber watch] program,” Seroka told Bloomberg in March.

“If someone gets impacted, they can share that data and we can synthesize it across the port community. We’ve got to now scale that nationwide.”

Shipping containers wait to be transferred from the ports of Los Angeles and Long Beach on Oct. 14, 2021. (John Fredricks/The Epoch Times)

None of the cyber attacks have succeeded, Port of Los Angeles spokesman Phillip Sanfield told The Epoch Times.

The twin ports of Los Angeles and Long Beach continue to sort through container backups following a deluge of imports during the pandemic. The ports remain the busiest seaports in the Western Hemisphere, processing about 40 percent of seaborne imports and 22 percent of seaborne exports nationwide each year.

At its peak, a record 109 ships waited to offload cargo at the port complex in January. That number had dropped sharply to only 21 ships July 29, according to the Marine Exchange of Southern California.

Cargo awaits unloading from ships off the Port of Long Beach, Calif., on Oct. 27, 2021. (John Fredricks/The Epoch Times)

The port expects imports to remain strong as deliveries of back-to-school items, fall fashions, and holiday goods start to arrive during the second half of this year, according to Seroka.

“Even though some retailers have high inventories and may look to discount goods, I expect imports to remain strong though tapered, versus last year,” Seroka said July 13.

Tyler Durden
Mon, 08/01/2022 – 10:16

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Weak Manufacturing Surveys Signal ‘Peak Inflation’; Plunge in Orders, Production, & Jobs

Weak Manufacturing Surveys Signal ‘Peak Inflation’; Plunge in Orders, Production, & Jobs

With broad weakness in ‘hard’ economic data and ‘soft’ survey data coming fast and furious, it was no surprise that S&P Global’s US Manufacturing PMI fell further intramonth to 52.2 in July from 52.7 in June – the lowest since July 2020. On the other hand, ISM Manufacturing beat expectations, falling from 53.0 to 52.8 (the lowest since June 2020) but that was better than the expected 52.0.

Source: Bloomberg

According to S&P Global, firms continued to pass-through higher costs to clients, as output charges rose at an historically elevated pace. The decrease in new order inflows was accompanied by a weakening of payroll growth to the lowest for six months.

However, according to ISM, Prices Paid plummeted from 78.5 to 60.0 – the biggest MoM drop since June 2010

Both employment and new orders remain in contraction (below 50)…

Chris Williamson, Chief Business Economist at S&P Global Market Intelligence, said:

With the exception of pandemic lockdown periods, July saw US manufacturers report the toughest business conditions since 2009. A growth spurt in the spring has quickly gone into reverse, with new orders for factory goods down for a second straight month in July, leading to the first drop in production for two years and sharply reduced employment growth.

“The rising cost of living is the most commonly cited cause of lower sales, as well as the worsening economic outlook.

“Companies are also taking an increasingly cautious approach to purchasing and inventories amid the gloomier outlook, and likewise appear to be cutting back on investment, with new orders falling especially sharply for business equipment and machinery in July.

Most notably, this appears to be the most market-moving aspect of the survey:

“Supply chain problems remain a major concern but have eased, taking some pressure off prices for a variety of inputs. This has fed through to the smallest rise in the price of goods leaving the factory gate seen for nearly one and a half years, the rate of inflation cooling sharply to add to signs that inflation has peaked.

Finally, firms’ expectations regarding the outlook for output over the coming 12 months remained at their lowest since October 2020 amid inflation and supply chain concerns, as well as a gloomier global economic outlook.

Tyler Durden
Mon, 08/01/2022 – 10:05

via ZeroHedge News https://ift.tt/R6dj1DJ Tyler Durden

Key Events This Busy Week: Jobs, ISM, And Even More Central Banks And Earnings

Key Events This Busy Week: Jobs, ISM, And Even More Central Banks And Earnings

After a frenzied week which saw not just the US slide into technical recession just hours after the Fed hiked rates by a whopping 75bps for the 2nd time in a row (hence accelerating the US slowdown), as well as record bonanza of corporate earnings, markets still won’t get the chance with US payrolls on Friday, followed by CPI on Wednesday 10th. If nothing out of the ordinary occurs in these two prints though maybe we can have a quiet two or three weeks according to DB’s Jim Reid, who however notes that if payrolls are far from consensus and/or CPI is strong then “we may have some fun and games in August. It’s a month of low liquidity and if something big happens it can be multiplied in such thin trading.”

Outside of payrolls, the other most important events this week include the manufacturing PMIs and ISM today, the RBA decision and US JOLTS tomorrow, services PMIs and ISM Wednesday, and the likely biggest hike from the BoE for 27 years alongside the increasingly important US jobless claims data on Thursday. Apart from that, earnings are still coming from all directions, but we are past halfway in the US with over 260 companies having reported. It’s 232 in the Stoxx 600. It might be hard to eclipse the big US tech week last week though. The other thing to look out for is whether US House Speaker Pelosi visits Taiwan this week on her Asian trip. It could set off a major geopolitical incident if she does and domestic accusations of backing down to China if she doesn’t given she’d previously said she would visit.

The full day by day week ahead is at the end as usual on a Monday but let’s preview the main highlights in detail with the big one being payrolls of course.

The median strategist expects a 250k reading for nonfarm payrolls (down from 372k in June) and for unemployment rate to remain flat at 3.6%. DB economists think the gradual increase in continuing claims since last month is enough to slow the pace of job growth. Remember Jim Reid recently did a CoTD on payrolls day last month showing that the first month of a recession on average has a negative payroll print whereas the months leading up to it don’t (including R-1). See here for a reminder. This is one of the main reasons Reid and DB don’t think we’re there yet in terms of a recession (but will be soon). The bank’s favored measure of the strength of the labor market has been the JOLTS data which next comes out tomorrow for June. The problem is that it is always one month behind other data. However it gives us a decent if slightly rear-view mirror look at job openings and labor market tightness.

Moving on, the BoE’s decision on Thursday will be a big event with consensus expecting a +50bps move, which will take the Bank Rate to 1.75% and become the largest single increase since 1995. It will likely also be accompanied by somewhat hawkish economic forecasts from the Bank.

Before the BoE, economists expect the RBA to also hike +50bps tomorrow. Regarding policy guidance, they expect the central bank to reiterate the need for higher interest rates, which would implicitly keep another +50bps hike in September among the options.

Turning to corporate earnings, this week’s line-up will feature a number of important commodities companies, including BP, Occidental Petroleum (tomorrow), ConocoPhillips and Glencore (Thursday). Travel & leisure firms like Marriott, Airbnb (tomorrow) and Booking (Wednesday) will be in the spotlight as well to assess trends in consumer spending on services. Notable carmakers reporting results will include Toyota (Thursday), BMW (Wednesday) and Ferrari (tomorrow). In healthcare, investors will be focused on Regeneron, Moderna (Wednesday), Eli Lilly, Novo Nordisk and Bayer (Thursday). Other notable reporters will include Advanced Micro Devices, PayPal (tomorrow), Maersk (Wednesday) and Alibaba (Thursday).

Day-by-day calendar of events:

Monday August 1

  • Data: US July ISM index, China July Caixin manufacturing PMI, Japan July vehicle sales, Eurozone June unemployment rate, Italy July PMI, budget balance, new car registrations, June unemployment rate
  • Earnings: HSBC, Heineken, Devon Energy, Activision Blizzard

Tuesday August 2

  • Data: US June JOLTS report, July total vehicle sales, Japan July monetary base, UK July Nationwide house price index, Canada July PMI
  • Central banks: RBA decision, Fed’s Bullard and Evans speak
  • Earnings: BP, Caterpillar, Ferrari, Marriott, KKR, Uber, S&P Global, Occidental Petroleum, Electronic Arts, Gilead Sciences, Advanced Micro Devices, Starbucks, Airbnb, PayPal, Marathon Petroleum

Wednesday August 3

  • Data: US July ISM services index, June factory orders, China Caixin July services PMI, Germany June trade balance, France June budget balance, Italy July services PMI, June retail sales, UK July official reserves changes, Eurozone June PPI, retail sales
  • Earnings: AXA, Maersk, CVS Health, McKesson, Just Eat, Regeneron, Nintendo, BMW, Vonovia, Moderna, Booking, Fortinet, eBay, Telecom Italia, Robinhood

Thursday August 4

  • Data: US June trade balance, Germany June factory orders, July construction PMI, UK July new car registrations, construction PMI, Canada June building permits, international merchandise trade
  • Central banks: BoE decision, Fed’s Mester speaks, ECB publishes its Economic Bulletin
  • Earnings: Alibaba, Eli Lilly, Toyota, Intercontinental Exchange, ConocoPhillips, Merck, Novo Nordisk, Bayer, Glencore, Cigna, Rolls-Royce, adidas, Cheniere, DBS, Apollo, Lyft, Expedia, Deutsche Lufthansa, Warner Bros Discovery, Vertex Pharmaceuticals, DoorDash, Atlassian, Amgen, Block, EOG, Kellogg, AMC

Friday August 5

  • Data: US July change in non-farm payrolls, unemployment rate, average hourlyearnings, participation rate, June consumer credit, Japan June household spending, labour cash earnings, real cash earnings, leading and coincident index, Germany June industrial production, France Q2 private sector payrolls, wages, June trade balance, industrial and manufacturing production, Italy June industrial production, Canada July net change in employment, unemployment rate
  • Central banks: BoE’s Pill speaks
  • Earnings: LSE group, Deutsche Post, Suncor, Allianz

* * *

Finally, focusing on just the US, Goldman notes that the key economic data releases this week are the ISM manufacturing report on Monday, JOLTS job openings on Tuesday, the ISM services report on Wednesday, and the employment situation on Friday. There are several speaking engagements from Fed officials this week, including remarks from Reserve Bank presidents Evans, Mester, and Bullard.

Monday, August 1

  • 09:45 AM S&P Global US manufacturing PMI, July final (consensus 52.3, last 52.3)
  • 10:00 AM Construction spending, June (GS -0.4%, consensus +0.2%, last -0.1%): We estimate construction spending decreased 0.4% in June.
  • 10:00 AM ISM manufacturing index, July (GS 51.7, consensus 52.0, last 53.0): We estimate that the ISM manufacturing index declined by 1.3pt to 51.7 in July reflecting a drag from tighter financial conditions and the deteriorating economic outlook in Europe. Domestic manufacturing surveys were mixed in the month, but the ISM has been running a bit above our manufacturing survey tracker (+0.3pt to 52.1 in July).

Tuesday, August 2

  • 10:00 AM JOLTS Job openings, June (GS 11,100k, consensus 11,000k, last 11,254k): We forecast job openings declined to 11,100k in June, reflecting a modest sequential softening in the high-frequency job openings data used in our nowcast of the jobs-workers gap.
  • 10:00 AM Chicago Fed President Evans (FOMC non-voter) speaks: Chicago Fed President Charles Evans will participate in an on-the-record breakfast conversation with reporters. In his last public appearance on June 22, Evans said, “I think that by the end of the year, we’ll be doing 25s [bp]” and “I expect it will be necessary to bring rates up a good deal more over the coming months in order to return inflation to the Committee’s 2% average inflation target.” Regarding inflation, he said, “I think there are risks, but we have to take the steam out of inflation” and “I have hoped before a few times [inflation] could be transitory. We can’t afford to be fooled again by this.” He added that he expects inflation “will cool substantially over the next couple of years.”
  • 11:00 AM New York Fed Releases 2Q Household Debt and Credit Report
  • 01:00 PM Cleveland Fed President Mester (FOMC voter) speaks: Cleveland Fed President Loretta Mester will participate in a Washington Post live interview. In her last remarks on July 13, Mester called the June CPI report “uniformly bad”. She said, “There was no good news in that report at all. We at the Fed have to be very deliberate and intentional about continuing on this path of raising our interest rate until we get and see convincing evidence that inflation has turned a corner.” She added, “Right now, job one for us is to get inflation under control, and I say that knowing that the risks of recession have gone up…If we don’t do this right we’re going to have many more problems in the economy going forward.”
  • 05:00 PM Lightweight motor vehicle sales, May (GS 13.3mn, consensus 13.5mn, last 13.0mn)
  • 06:45 PM St. Louis Fed President Bullard (FOMC voter) speaks: St. Louis Fed President James Bullard will discuss the economic and policy outlook at an event with the Money Marketeers of New York University. Text and audience Q&A (no media) are currently expected. On July 15, Bullard noted, “I would now say that we may have to try to hit [a funds rate of] 3.75 to 4% by the end of 2022.” He said, “It probably doesn’t make too much difference to do 100 basis points here and less in the other three meetings of this year, or to do 75 basis points here and slightly more in the remaining three meetings for the year.” He added that inflation “has come in broader and hotter than previously had been expected…But we’ve got the right policy to bring it back to 2% in a relatively short timeframe, and I would say something like 18 months.”

Wednesday, August 3

 

  1. 09:45 AM S&P Global US services PMI, July final (consensus 47.0, last 47.0)
  2. 10:00 AM Factory orders, June (GS +1.2%, consensus +1.0%, last +1.6%); Durable goods orders, June final (consensus +1.9%, last +1.9%); Durable goods orders ex-transportation, June final (consensus +0.3%, consensus +0.3%); Core capital goods orders, June final (last +0.5%); Core capital goods shipments, June final (last +0.7%): We estimate that factory orders increased 1.2% in June following a 1.6% increase in May. Durable goods orders increased 1.9% in the June advance report, and core capital goods orders increased 0.5%.
  3. 10:00 AM ISM services index, July (GS 53.3, consensus 53.7, last 55.3): We estimate that the ISM services index declined by 2pt to 53.3 in July, reflecting a sentiment drag from tighter financial conditions and sequential weakness in the real estate market. Our non-manufacturing survey tracker decreased 2.6pt to 51.3.

Thursday, August 4

 

  • 08:30 AM Trade balance, June (GS -$79.5bn, consensus -$80.0bn, last -$85.5bn): We estimate that the trade deficit decreased by $6.0bn to -$79.5bn in June, reflecting an increase in exports.
  • 08:30 AM Initial jobless claims, week ended July 30 (GS 260k, consensus 260k, last 256k); Continuing jobless claims, week ended July 23 (consensus 1,338k, last 1,359k): We estimate initial jobless claims increased to 260k in the week ended July 30.
  • 12:00 PM Cleveland Fed President Mester (FOMC voter) speaks: Cleveland Fed President Loretta Mester will discuss the economic and policy outlook at an event hosted by the Economic Club of Pittsburgh. Audience Q&A is currently expected.

Friday, August 5

  • 08:30 AM Nonfarm payroll employment, July (GS +225k, consensus +250k, last +372k); Private payroll employment, July (GS +175k, consensus +230k, last +381k); Average hourly earnings (mom), July (GS +0.3%, consensus +0.3%, last +0.3%); Average hourly earnings (yoy), July (GS +4.9%, consensus +5.1%, last +5.1%); Unemployment rate, July (GS 3.6%, consensus 3.6%, last 3.6%); Labor force participation rate, July (GS 62.2%, consensus 62.2%, last 62.2%): We estimate nonfarm payrolls rose by 225k in July (mom sa), a slowdown from the +372k pace in June. The July seasonal factors have evolved significantly more restrictive—even more so than in June—and the seasonal adjustment software may be overfitting to the reopening-related job strength in the summers of 2020 and 2021. We assume seasonal headwind of roughly 250k in our forecast. Additionally, while Big Data indicators were mixed in the month, jobless claims have risen, consistent with a drag from tighter financial conditions and modestly higher retail and technology layoffs. On the positive side, we expect a boost from education seasonality, reflecting fewer-than-normal janitors and support staff leaving for the summer (we assume +75k mom sa, public and private).
  • We estimate an unchanged unemployment rate at 3.6%, reflecting flat-to-up labor force participation and a rebound in household employment, the latter of which does not exhibit the same negative residual seasonality we expect in nonfarm payrolls. We estimate a 0.3% rise in average hourly earnings (mom sa) that lowers the year-on-year rate by two tenths to 4.9%. The arrival of the youth labor force may have eased some of the upward pressure on wages, but we expect a boost from positive calendar effects.

Source: DB, Goldman, BofA

Tyler Durden
Mon, 08/01/2022 – 09:54

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Senior Economist ‘Fact Checked’ By Facebook For Saying US Is In Recession

Senior Economist ‘Fact Checked’ By Facebook For Saying US Is In Recession

Authored by Steve Watson via Summit News,

An experienced economist has been ‘fact checked’ and corrected by Facebook after he stated that the U.S. is now in a recession.

Phil Magness, a researcher and educator with the American Institute for Economic Research, reacted to the incident by commenting “We live in an Orwellian hell-scape.”

Facebook uses ‘independent’ fact checkers at Politifact, a brazenly partisan operation, which ‘corrected’ Magness’ post about the Biden administration attempting to change the definition of a recession.

Magness provided examples of previous statements by Biden himself about being in a recession that were never fact checked:

The economist also noted that practically every other country defines a recession as two consecutive quarters of negative growth:

Biden and his underlings have engaged in gaslighting on the definition of recession throughout the past week, and it has continued into this week:

Meanwhile, on Brian Stelter’s clown show Sunday, New York Times columnist and ‘economist’ Paul Krugman replied “No, we aren’t and no, it doesn’t,” when asked “Are we in a recession and does the term matter?” 

Krugman said “None of the usual criteria that real experts use says that we’re in a recession right now,” which is blatantly not true.

“What does matter?” Krugman further stated, adding “The state of the economy is what it is. Jobs are abundant.”

As for Krugman’s repetition of the Biden talking point about jobs…

*  *  *

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Tyler Durden
Mon, 08/01/2022 – 09:40

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Oil Tumbles On China PMI Weakness, Libya Output Hike; To Remain Muted On Low Liquidity

Oil Tumbles On China PMI Weakness, Libya Output Hike; To Remain Muted On Low Liquidity

Oil started the new month on the back foot, driftng lower slowly at first and then accelerating the move to the downside, with Brent trading just south of $100, as disappointing Chinese PMI prints added to concerns that a global slowdown may sap demand while an increase in Libyan output eased supply concerns ahead of this week’s OPEC+ meeting.

WTI slid below $97/bbl after sinking almost 7% in July in the first back-to-back monthly loss since late 2020. Weekend data indicated a surprise contraction in Chinese factory activity, highlighting the cost of mobility curbs to tackle Covid outbreaks. Purchasing managers’ indexes also weakened in South Korea and the euro area’s four largest members.

Libya’s crude output has rebounded to its early April levels, the OPEC member’s oil minister said, in an increase that could help cool a jittery global oil market. Output climbed to 1.2 million barrels per day, Oil Minister Mohamed Oun said in a Bloomberg telephone interview. The increase comes after officials reached an agreement earlier this month with protesters and tribal leaders to reopen fields and export terminals largely shut for months.

Unfortunately for bulls, as Bloomberg’s Nour Al Ali correctly notes, open interest in Brent crude indicates that low liquidity is driving the market at the moment. This means that prices may remain range-bound as traders assess recessionary risks against tight market dynamics.

As Ali adds, even before OPEC+ meets later this week, the verdict might already be out: “Low open interest in Brent shows that traders are as invested as they can be in the oil market for the time being. When both prices and open interest fall, that could mean that long positions are being liquidated.  This chart that Alex Longley showed me earlier today shows aggregate open interest adjusted for prices near historic highs.”

Of course, as we have been pounding the table for months, on the ground, market fundamentals still look extremely tight. The market is in backwardation, where near-term prices trade at a premium to long-term ones. In fact, it’s gotten tighter for Brent over the last month as the chart below shows!

The concern, however, is demand destruction. Some corners of the market remain bullish over oil after the rally of the last two years, but slower global growth as well as a stronger dollar mean big consumers such as China and India might start to cut back demand. In a dynamic like this, it’s hard to see how OPEC+ can heed to US demand for more oil. More barrels on the block could mean less revenue for producers.

But not today: as the next chart from Bloomberg shows, in a stark reversal from years of underperformance, US drillers are drowning in cash and are expected to post record 2Q profits in coming days, reversing nearly a decade of debt-fueled losses. The top 28 publicly traded US independent oil producers generated $25.5 billion in free cash flow in the three months to June 30, according to estimates compiled by Bloomberg. In that space of time they’ll have made enough cash to erase one-fourth of what they lost over the previous decade!

Meanwhile, speaking of this week’s OPEC+ meeting, Bloomberg notes that Biden took a political gamble with his visit to Saudi Arabia last month, courting a kingdom he once vowed to punish in a quest for more oil supplies, and this week will reveal whether it paid
off.
The US president said he expected “further steps” from the Saudis to cool oil prices and safeguard the global economy at the close of his trip to Jeddah two weeks ago. OPEC+ will decide on Wednesday whether to oblige, though delegates warn that any supply boost would be modest — and may not materialize at all. The reason why? As Bloomberg’s Javier Blas notes, for only the 3rd time only in history, Saudi Arabia oil production is rising above 11m b/d from today (OPEC+ quota for Riyadh for August is exactly 11.004m b/d).

In other words, even if it wanted to, the best Saudi can do is ramp up output by a few barrels here and there…

Tyler Durden
Mon, 08/01/2022 – 09:22

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Cops Forget To Close Patrol Car Door, Handcuffed Woman Rolls Out and Dies


open squad car door from which Brianna Grier fell

Georgia police did not close a squad car door after placing a handcuffed woman in the backseat and then driving off. The woman—28-year-old Brianna Grier, who was in the midst of a mental health crisis—later rolled out of the moving car and suffered injuries that led to her death.

“Agents have concluded that the rear passenger side door of the patrol car, near where Grier was sitting, was never closed,” according to the Georgia Bureau of Investigation (GBI). “GBI agents concluded that Grier was placed in the backseat of the patrol car, handcuffed in the front of her body with no seatbelt.”

“To put Grier in the patrol car, one of the deputies walked around and opened the rear passenger side door,” said the GBI. “The deputy quickly returned to the rear driver’s side door. Both deputies put Grier in the backseat of the patrol car. The deputies closed the rear driver’s side door. The investigation shows that the deputy thought he closed the rear passenger side door. The deputies left the scene and drove a short distance.”

On Friday, the GBI released bodycam video footage of the July 15 encounter. It shows Hancock County deputies approaching Grier, who tells them repeatedly she is not drunk and they can give her a breathalyzer test. They carry a handcuffed Grier to the car as she shouts: “Get off me! I ain’t broke no law!” Grier also threatened to harm herself if they took her in.

We see one of the officers get int his squad car and then drive for a while before stopping, getting out, and running to the side of the road, where Grier is lying motionless. The officer who was driving is joined by another officer, who had been in a car behind him. They check that Grier is still breathing (she is) and keep yelling at her to sit up as she lays there, seeming unresponsive.

At several points, the video footage flashes back to the cop car she had been in and shows that the back door is wide open. The cop who had been driving closes it, then comes back to the other cop, who is cradling Grier in his lap.

“How did she jump out?” asks the cop holding Grier, commenting that the back door of the car isn’t supposed to be unlocked. “How’d your back door open?” He tells the other cop that when he writes his report, he should “just say, you know, you got out, and the back door was open.”

“She’s fine, she’s fine,” the cop holding Grier keeps saying throughout this. Neither of them attempts to perform any resuscitating measures on her, though they do take off her handcuffs.

Grier fell into a coma. She died in an Atlanta hospital six days later, having sustained severe head injuries.

Her death is the latest to show how police responses to psychological episodes can have tragic results.

The Hancock County deputies had arrested Grier after her family called for help. “Marvin Grier said his wife called authorities on the night of July 14 because their daughter, who was diagnosed with schizophrenia nearly a decade ago and was medicated for the condition but used illegal drugs to cope, was having a mental health crisis,” reports NBC:

During previous similar episodes, he said ambulances were dispatched to the family’s home and she was cared for in a medical setting. Last week, two deputies came in a patrol car instead, Marvin Grier said.

His daughter told the deputies that she’d been drinking, Marvin Grier recalled, so one of the deputies said they would detain her for intoxication until the morning, when she could get medical attention.

Police told the Grier family that their daughter had “kicked the door open and jumped out of the car.”


FREE MINDS

National Review says libertarian-conservative fusionism still matters. Dan McLaughlin writes:

When fusionism is discussed today, especially by its critics, the focus is typically on fusionism as an ideological project. That project, often identified with William F. Buckley Jr. and Reaganism, was largely the intellectual handiwork of Frank Meyer and M. Stanton Evans. For a flavor of the debate at the time, read Meyer and L. Brent Bozell Jr. in these pages 60 years ago debating the relative merits of fusionism as opposed to Bozell’s case for the primacy of virtue over liberty as the central organizing principle of conservatism….

Meyer wanted conservatives of varying stripes and factions to see one another not merely as uneasy coalition partners, but as common adherents to a single, coherent creed. His success in this was not complete, but the endeavor was nonetheless remarkably effective for over half a century.

McLaughlin says that “the philosophical fusion that Meyer and his successors forged is still vital to what National Review does. It remains crucial to how conservatives should think about the principles of our movement and how we call ourselves and our allies to fidelity to those principles—even as the Meyer–Bozell debate is still with us.”

This sounds nice, but the conservative movement as a whole these days seems less and less keen on the liberty end of this equation. Read Reason‘s Stephanie Slade on how “conservatives have lost sight of the relationship between liberty and personal responsibility” in the years since the Cold War.


FREE MARKETS

There’s always another drug war (sigh). But as states move to ban hemp-based Delta 8, hemp businesses are fighting back. NPR reports:

State regulators in Texas, Kentucky and Kansas are facing lawsuits from the hemp industry over new restrictions. In Virginia, regulators were met with occasional jeers and angry outbursts at a meeting earlier this month after they announced new restrictions on edible delta-8 products.

Some of the hemp entrepreneurs at that meeting said regulators were using bad actors to villainize an entire industry. Many argued for regulation rather than prohibition, which they argued would just hurt Virginia’s competitiveness in relation to other states with friendlier laws.

“I’m about 45 minutes from the Tennessee border,” hemp processor Kerry McCormick told Virginia’s hemp commission. “About 15 of my jobs are about to get outsourced to Tennessee. That’s going to be on this committee.”

Earlier this year, a federal appeals court said Delta 8 was legal under the parameters of the 2018 farm bill.


QUICK HITS

• President Joe Biden has a case of rebound COVID after taking Paxlovid.

• “The ripple effects of the Covid-19 pandemic’s influence on nearly every aspect of health in America are becoming clear,” writes Brianna Abbott at The Wall Street Journal. “Overall deaths and the death rates from heart disease and stroke rose sharply during the pandemic,” and overdose deaths and reports of excessive drinking were also up.

• The new spending bill will raise taxes on middle-class earners, according to the Congressional Joint Committee on Taxation.

• Remember sex bracelet hysteria? “In 2003, a media frenzy led schools across the country to ban colorful jelly bracelets out of concern they were being used for a teen sex game,” reminds us. “The origins of that frenzy—and the speed with which it spread—offer enduring insight into the machinations behind moral panic.”

• New York City has declared monkeypox a public health emergency. “The declaration will allow officials to issue emergency orders under the city health code and amend code provisions to implement measures to help slow the spread,” reports NPR.

• Kansans tomorrow will vote on whether the state constitution should protect abortion.

• “Andrew Yang’s rebooted Forward Party glosses over Americans’ conflicting values and preferences,” argues J.D. Tuccille.

• “The pediatric neurosurgeon who first popularized shaken-baby syndrome has doubts about how it is used in courtrooms today,” reports C.J. Ciaramella.

• Biden wants “to turn the U.S. into a hub of microchip manufacturing,” says Politico. But this can’t happen without immigration reform.

• Indiana’s Senate has passed a near-total ban on abortion; the measure will now be considered by the state’s House of Representatives.

The post Cops Forget To Close Patrol Car Door, Handcuffed Woman Rolls Out and Dies appeared first on Reason.com.

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