Teen Jailed for Zero Tolerance Offense, Starved for 36 Hours

Mosin nagantI previously wrote about
Alexander Chier
, a Pewaukee, Wisconsin, 17-year-old who was
disciplined by his high school for smoking a cigarette. This caused
the police to search his vehicle, where they found his hunting
rifle. Since the weapon was technically on school grounds, he was
suspended and arrested.

Chier spoke with me via e-mail to relate his side of the story.
There are no key details in dispute; even so, it’s hard not to
sympathize with the teenager, who was jailed for a night and denied
food for 36 hours, according to his account.

“I had to spend a night in jail after the interrogation, and
didn’t receive food that I could eat for 36 hours,” Chier
told Reason. “You see I have life threatening food
allergies to the point where legally I have a disability
(Anaphylaxis to peanuts, nuts, milk and eggs). 1/8 of a peanut
would have me dead in 10 minutes or less. I had 2 different
physicians and my allergist call the Waukesha County Jail to convey
this and I was still denied editable food.”

Other pieces of new information: Chier was caught smoking an
e-cigarette, not a regular cigarette, at school; the weapon found
in his car was a “bolt action mosin-nagant from 1937,” which he
uses to hunt coyotes; and he voluntary granted the cops access to
all his text messages and social media activity.

According to Chier, he turned himself over to the police,
subsequently enduring a four-hour interrogation and a famishing
night in jail.

Police agree that Chier was not planning to hurt anyone.

“We have no information at all that would have led us in that
direction,” a spokesperson for the Village of Pewaukee Police
Department told Reason.

The good news is that Chier expects the charges to be
dropped.

“Basically as long as I show up to my next court date and commit
no crimes I’m a clear man,” he said.

He is still suspended, however, and could be expelled. He’s not
happy about that, obviously.

“The fact that I’m facing expulsion in so extreme in every way,”
he said. “They will punishing a hunter who made a mistake, had no
ill intent, harmed no one, and never planned to do so; and if the
Pewaukee Police Department and the State of Wisconsin both gave
determined I am no threat to anyone I should be allowed to go back
to school!”

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Ira Stoll on the Left’s Populist Tax Agenda

Copying the right’s success, the left
is taking its tax agenda directly to the people. This November,
voters will again have the chance to decide on taxes. But as Ira
Stoll reports, in a number of cases, the questions they will be
voting on are not aimed at limiting taxes or at cutting them, but,
instead, at increasing them.

View this article.

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10k Troops Will Stay in Afghanistan After Official Pullout, White House Supports Hong Kong Protests, Judge Says Detroit Water Shutoffs to Continue: P.M. Links

  • Nearly
    10,000 American troops
    will remain in Afghanistan after 2014,
    promises the country’s newly elected president Ashraf Ghani
    Ahmadzai. The U.S. will also likely keep its
    secret prisoners
    when the war “ends.”
  • State Department spokeswoman Jen Psaki says that when
    President Barack Obama said his administration “underestimated” the
    threat of ISIS he
    didn’t really mean it
    . We’ve “long been tracking this,” she
    insists. So, we knew what was happening and just dropped the
    ball?
  • Grab your popcorn: The White House gave
    a thumbs up
    to the pro-democracy protests in Hong Kong, which
    are
    still growing
    in spite of tear gas and officials’ demands.
  • The bankruptcy judge overseeing Detroit’s woes said that

    shutting off water to non-paying customers can continue
    ,
    because he has no jurisdiction to act otherwise.
  • Elizabeth Warren wants a
    congressional investigation
    of the New York Federal Reserve
    after recently secret recordings suggest some foul play by the
    financial authority.
  • American consumer spending rose 0.5 percent last month. The

    housing sector
    remained an exception, and not in a good
    way. 
  • Top Obama adviser Valarie Jarrett apparently isn’t busy. She
    made her debut on a television drama this weekend, and it
    was pretty
    ugly
    .

Follow Reason and Reason 24/7 on
Twitter, and like us on Facebook. You
can also get the top stories mailed to you—sign up
here
.

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Yet More IRS Employees Busted for Stealing Taxpayers' Identities

HackerIt’s hard to keep up with the
privacy-threatening shenanigans at the Internal Revenue Service,
but let’s give it a try. Just days after revealing that the tax
agency’s failure to follow its own rules
put the private data of 1.4 million people at risk
, the
Treasury Inspector General for Tax Administration publicized the
sentencing of Tax
Examining Technician Missy Sledge
for aggravated identity theft
and mail fraud, and IRS employee
Monica Hernandez
for making and subscribing a false income tax
return, wire fraud, and aggravated identity theft.

According to the Inspector General’s Office, “as part of her
official IRS duties, Sledge had access to taxpayers’ personal
identifiers, including names, Social Security Numbers (SSN), dates
of birth, and addresses, as well as information about tax
professionals. Sledge used this access in furtherance of an
identity theft scheme which included the filing of fraudulent tax
returns and the subsequent theft of refunds.”

For her part, “Hernandez regularly handled and processed tax
returns on behalf of the IRS by entering taxpayers’ tax information
into the IRS computer system. During the course of her IRS
employment, Hernandez stole tax information in order to file
fraudulent tax returns and claim large tax refunds.”

Sledge received 57-months imprisonment, followed by five years
of supervised release. Hernandez got 53-months imprisonment,
followed by three years of supervised probation. Both have to pay
restitution to the IRS.

But that was last month. This month, we hear about former IRS
employee Taylor
Knight
who “inappropriately accessed information maintained by
the IRS for three taxpayers, in each case for her personal reasons
and not for official Government business. The defendants then used
the identifications of these three taxpayers to fraudulently induce
the IRS into issuing tax refund payments.”

Knight hasn’t ben sentenced yet, but faces up to five years in
prison.

Again, IRS records prove themselves to be a bonanza of personal
information for identity thieves who trawl through the less than
securely maintained data looking for a dishonest payday.

Have I mentioned that people signing for health coverage under
the Affordable Care Act are supposed to
update the government
on any major life changes, including
marriage status, employment, finances…? Oh wait,
yes I have
.

I wonder if that information will be better protected.

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Yet More IRS Employees Busted for Stealing Taxpayers’ Identities

HackerIt’s hard to keep up with the
privacy-threatening shenanigans at the Internal Revenue Service,
but let’s give it a try. Just days after revealing that the tax
agency’s failure to follow its own rules
put the private data of 1.4 million people at risk
, the
Treasury Inspector General for Tax Administration publicized the
sentencing of Tax
Examining Technician Missy Sledge
for aggravated identity theft
and mail fraud, and IRS employee
Monica Hernandez
for making and subscribing a false income tax
return, wire fraud, and aggravated identity theft.

According to the Inspector General’s Office, “as part of her
official IRS duties, Sledge had access to taxpayers’ personal
identifiers, including names, Social Security Numbers (SSN), dates
of birth, and addresses, as well as information about tax
professionals. Sledge used this access in furtherance of an
identity theft scheme which included the filing of fraudulent tax
returns and the subsequent theft of refunds.”

For her part, “Hernandez regularly handled and processed tax
returns on behalf of the IRS by entering taxpayers’ tax information
into the IRS computer system. During the course of her IRS
employment, Hernandez stole tax information in order to file
fraudulent tax returns and claim large tax refunds.”

Sledge received 57-months imprisonment, followed by five years
of supervised release. Hernandez got 53-months imprisonment,
followed by three years of supervised probation. Both have to pay
restitution to the IRS.

But that was last month. This month, we hear about former IRS
employee Taylor
Knight
who “inappropriately accessed information maintained by
the IRS for three taxpayers, in each case for her personal reasons
and not for official Government business. The defendants then used
the identifications of these three taxpayers to fraudulently induce
the IRS into issuing tax refund payments.”

Knight hasn’t ben sentenced yet, but faces up to five years in
prison.

Again, IRS records prove themselves to be a bonanza of personal
information for identity thieves who trawl through the less than
securely maintained data looking for a dishonest payday.

Have I mentioned that people signing for health coverage under
the Affordable Care Act are supposed to
update the government
on any major life changes, including
marriage status, employment, finances…? Oh wait,
yes I have
.

I wonder if that information will be better protected.

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Despite Late-Day Buying Panic, Stocks Close Red

Heavy volume and volatile price action early in stocks and high-yield credit markets subsided later in the day as despite several big stocks in the red, the indices jammed higher in the last hour desparate to get positive (on terrible volume) but failed. Treasury yields fell 3-4bps early on and stuck near the lows of the day (ignoring equity's exuberance). High-yield credit rallied back off early spike wides at 380bps (with desks noting heavy demand for protection) but remains worse than stocks. VIX tested above 17 and crashed back below 15.5. The USD ended the day unchanged (AUD weakness notable) but gold and silver slipped lower with oil (back over $93) and copper up on the day. Camera-on-a-stick smashed over 11% higher to $91.50 as the 41% float short continues to get squeezed out.

 

Credit and stocks diverged early once again as selling was heavy and protection well bid…

 

And despite equity exuberance, Treasuries rallied then ignored stocks…

 

Even USDJPY decoupled from the exuberance…

 

As VIX ran the market once again…

 

As stocks scrambled lat eon to try and get green (with only Trannies successful)

 

All that matters for tomorrow is keeping the quarter green… (aint gonna happen for the Russell 2000)

 

 

Financials stocks continue to decouple from credit…

 

Investors continued to find safe harbor in camera-on-a-stick-or-dog…

 

Ford was monkey-hammred after "a disastrous commentary during analyst presentations"

 

Charts: Bloomberg




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Is This "The Age of the Comedown"? Some Millennials Think So

Over at Splice
Today
, millennial Nicky Smith announces that the future is only
so bright because of the likely nuclear flash that’s going to
happen before 2100. He’s responding to novelist Bret Easton Ellis’
recent Vanity Fair jeremiad against millennials as “Generation
Wuss
.” Ellis is right, says Smith. “Millennials are
over-sensitive, narcissistic, unrealistic and anxious. No mystery
why: we grew up in the midst of an unprecedented end-of-the-century
party in the Western World.”

Smith
continues
:

What Ellis cannot comprehend is the unspoken certainty amongst
people my age that the world will not make it to 2100. There is
just absolutely no way—climate change, earthquakes, massive
expulsions of methane, radioactive fallout, dramatic terrorist
attacks—and the human experiment is nearing its end. It’s not
pessimism, but it’s easy to forget that the Cuban Missile Crisis
was only 52 years ago next month. That’s a blip of human history,
and it only takes one loon, or a group of organized and legitimate
loons and psychopaths in positions of power to orchestrate mass
death or total annihilation. Let’s assume we all behave ourselves
and refrain from blowing or mutating everything away: there’s a
consensus in the scientific community that climate change is at too
advanced a stage to stall, and its effects will be irreversible and
make coastal cities uninhabitable very, very soon.

Ellis is 50; he’s in the September of his years. He’ll most
likely be fine, and he doesn’t have to worry about what the air in
Los Angeles will be like in 2067. When pressed, Boomers blow it off
as sophomoric fatalism and go on about the sanctity and durability
of life. They can’t help it—that was their world, their narrative.
We’re living in the Age of the Comedown, and very soon everyone
will be feeling it worse than they could’ve ever imagined.

As someone who turned 50 a year ago, I prefer to
think of Ellis as being in the June of his years (if not
late May).

But wow, what a Debbie Downer Young Goodman Smith is! Doesn’t he
read Reason.com enough to know that we not only survived the Cuban
Missile Crisis but we won the Cold War to boot (for god’s sake, the
25th anniversary of the destruction of the Berlin Wall is coming up
this fall); ISIS and assorted Islamist-themed jackasses need to be
taken out, but they’re not an existential threat to the civilized
world. 

Climate change isn’t the bugaboo he seems to think,
either. To paraphrase Reason‘s Science Correspondent
Ronald Bailey, it’s happening; humans are involved; and we’ll
figure out how to cope with anything that gets thrown our way, just
like we’ve been doing for thousands of years. The air in Los
Angeles today is vastly cleaner than it was in 1967 and there’s
absolutely no reason to believe it will be dirty again in 2067.
Indeed, the air in Bejing, which is dirtier than it was 40 years
ago due to the sort of economic production that has lifted millions
of Chinese up from subsistence, will be cleaner in 2067 than it is
now.

As the parent of millennials myself—and the
younger brother of a sibling who graduated college in the grim year
of 1981—I feel sympathy for young adults these days due to economic
malaise and looming fiscal issues. But if the past is prologue and
if the political class does the bare minimum to rein in
entitlements and the like (yes, a big if), even the
near-future will be upbeat. When I graduated college just four
years after my brother, things had already turned the corner.

While it will take a lot of effort to make sure that politicians
give in to the Libertarian Moment and start enacting the sort of
common-sense reforms to right the ship of state and allow economic
markets to get cranking again, there’s every reason to believe
things are going to be all right. For god’s sake, the Libertarian
Moment is so happening that conservative-types are
hauling out Hitler arguments
to combat it. In the meantime,
Nicky Smith, take a moment to talk to your elders about how shitty
things were for them at various times back in the day.

For a different perspective on millennials, check out
Reason.com’s incredible
landing page dedicated to the subject
.

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Is This “The Age of the Comedown”? Some Millennials Think So

Over at Splice
Today
, millennial Nicky Smith announces that the future is only
so bright because of the likely nuclear flash that’s going to
happen before 2100. He’s responding to novelist Bret Easton Ellis’
recent Vanity Fair jeremiad against millennials as “Generation
Wuss
.” Ellis is right, says Smith. “Millennials are
over-sensitive, narcissistic, unrealistic and anxious. No mystery
why: we grew up in the midst of an unprecedented end-of-the-century
party in the Western World.”

Smith
continues
:

What Ellis cannot comprehend is the unspoken certainty amongst
people my age that the world will not make it to 2100. There is
just absolutely no way—climate change, earthquakes, massive
expulsions of methane, radioactive fallout, dramatic terrorist
attacks—and the human experiment is nearing its end. It’s not
pessimism, but it’s easy to forget that the Cuban Missile Crisis
was only 52 years ago next month. That’s a blip of human history,
and it only takes one loon, or a group of organized and legitimate
loons and psychopaths in positions of power to orchestrate mass
death or total annihilation. Let’s assume we all behave ourselves
and refrain from blowing or mutating everything away: there’s a
consensus in the scientific community that climate change is at too
advanced a stage to stall, and its effects will be irreversible and
make coastal cities uninhabitable very, very soon.

Ellis is 50; he’s in the September of his years. He’ll most
likely be fine, and he doesn’t have to worry about what the air in
Los Angeles will be like in 2067. When pressed, Boomers blow it off
as sophomoric fatalism and go on about the sanctity and durability
of life. They can’t help it—that was their world, their narrative.
We’re living in the Age of the Comedown, and very soon everyone
will be feeling it worse than they could’ve ever imagined.

As someone who turned 50 a year ago, I prefer to
think of Ellis as being in the June of his years (if not
late May).

But wow, what a Debbie Downer Young Goodman Smith is! Doesn’t he
read Reason.com enough to know that we not only survived the Cuban
Missile Crisis but we won the Cold War to boot (for god’s sake, the
25th anniversary of the destruction of the Berlin Wall is coming up
this fall); ISIS and assorted Islamist-themed jackasses need to be
taken out, but they’re not an existential threat to the civilized
world. 

Climate change isn’t the bugaboo he seems to think,
either. To paraphrase Reason‘s Science Correspondent
Ronald Bailey, it’s happening; humans are involved; and we’ll
figure out how to cope with anything that gets thrown our way, just
like we’ve been doing for thousands of years. The air in Los
Angeles today is vastly cleaner than it was in 1967 and there’s
absolutely no reason to believe it will be dirty again in 2067.
Indeed, the air in Bejing, which is dirtier than it was 40 years
ago due to the sort of economic production that has lifted millions
of Chinese up from subsistence, will be cleaner in 2067 than it is
now.

As the parent of millennials myself—and the
younger brother of a sibling who graduated college in the grim year
of 1981—I feel sympathy for young adults these days due to economic
malaise and looming fiscal issues. But if the past is prologue and
if the political class does the bare minimum to rein in
entitlements and the like (yes, a big if), even the
near-future will be upbeat. When I graduated college just four
years after my brother, things had already turned the corner.

While it will take a lot of effort to make sure that politicians
give in to the Libertarian Moment and start enacting the sort of
common-sense reforms to right the ship of state and allow economic
markets to get cranking again, there’s every reason to believe
things are going to be all right. For god’s sake, the Libertarian
Moment is so happening that conservative-types are
hauling out Hitler arguments
to combat it. In the meantime,
Nicky Smith, take a moment to talk to your elders about how shitty
things were for them at various times back in the day.

For a different perspective on millennials, check out
Reason.com’s incredible
landing page dedicated to the subject
.

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China Housing Bubble Bursts: Q3 Land Sales Crater 50%

China may be doing everything in its power to divert attention from the simple fact that its housing bubble, the largest in the world in terms of both assets comprising it as well as divergence from fair value, has burst. But while there is no clear threshold of what constitutes a bursting bubble when it comes to housing, the latest data out of Soufun, China’s largest real-estate website, which said that land sales have dropped a massive 22% to 1.7 trillion Yuan in 2014 so far, is likely as clear an indication as any that Beijing is about to panic.

And if that was not enough Bloomberg adds that land sales in 300 cites followed by Soufun fell almost 50% Y/Y to 415.9 billion yuan in 3Q, while residential land sales declined more than 50% to 265.3b yuan in 3Q.

So why, aside from the obvious, is this relevant? Because recall as we reported two weeks ago when looking at US household net worth, in the US it is all about (record) financial assets. So much so, in fact, that financial assets as a percentage of total household assets have never been higher at 70.3%, which also means that real estate as a percentage of total is as low as it has ever been.

Meanwhile, in China few households care as much about financial assets (the ones that do are largely a part of the Politburo or the ultra-rich oligrachy). Instead, the largest Chinese household asset is Real Estate, which at 74.7% of total household assets, is by far the most valuable asset that China’s population has.

 

And once a few hundred million Chinese wake up and realize that the “wealth effect” portrayed by the blue bar above has been obliterated, the riots currently taking place in Hong Kong will be a gentle warm up for what the People’s Liberation (sic) Army will be about to face.




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Gross To Have Final Laugh? Whopping Two-Thirds Of PIMCO's Flagship Fund May Be Withdrawn

The reason why the first article we wrote on Friday after news hit that PIMCO co-founder was shockingly leaving the firm on Friday, was listing the massive bond fund’s biggest holdings, was because it was only a matter of time: it, being of course, the massive redemptions that would follow Gross’ departure by people that his 30+ tenure at the bond fund made very rich, and who couldn’t care less about a brief central planning-inspired flame out. After all Gross isn’t the first person who has lost the plotline due to the Fed’s manipulation of every market.

So just how bad is it? Not for Gross of course: he has made his billions and is simply doing what he and Icahn do in their age: what they love. No, for Pimco, where the redemptions requests are already flooding in. According to the WSJ, just two days after the Gross announcement (both of which non-workdays), already some $10 billion has been withdrawn. And that is just the beginning:

Pacific Investment Management Co. suffered roughly $10 billion of withdrawals following the Friday departure of co-founder Bill Gross, a person familiar with the matter said, a sign of how quickly Mr. Gross’s surprise move is reshaping the bond-investing landscape.

 

Pimco is bracing for more outflows on the heels of the veteran investor’s departure after months of internal strife over his leadership. At the same time, some managers say they remain committed to the firm.

 

Some within the Newport Beach, Calif., investment firm are projecting it will lose at least $100 billion or more in assets due to withdrawals, the person familiar with the matter said, and some analysts peg the estimate higher.

 

Pimco Chief Executive Douglas Hodge said in a statement his firm “manages nearly $2 trillion in assets, and we are confident that the vast majority of our clients will continue to stand with us.”

Will they? Remember: it wasn’t Allianz, or Pimco, or some bond manager that was unknown until the El-Erian shake up earlier this year, that gave the Newport Beach bond manager $2 trillion in AUM. It was Bill Gross. And it would be a fitting farewell for Gross, who departed his former employer in what some say was a bout of rage, that his departure would also lead to the effective closure or outright liquidation of a bond fund which is forced to dump more than half of its holdings… at firesale prices in a bidless market!

The flight of $100 billion, more assets than many mutual funds hold, could roil some parts of the bond market with limited trading activity, experts say, as Pimco sells assets to meet investor redemptions and other managers put new money to work.

Rivals are trying to position themselves to attract some of the Pimco outflows.

“There is a good chance that Pimco will lose its dominant position as a fixed-income manager as assets find their way into other investment managers, thereby leveling the playing field in fixed income,” said Gary Pollack, who helps oversee $12 billion as head of fixed-income trading in New York at Deutsche Bank’s private wealth-management unit.

So far the biggest winner is the man many have coined the next bond king: “Competitor DoubleLine Capital saw its biggest inflow of the year Friday, taking in “hundreds of millions of dollars,” said Jeffrey Gundlach, chief executive.”

In the meantime, PIMCO, now ex-Gross is celebrating:

Even as Pimco prepared for some investors to follow Mr. Gross, Mr. Hodge said executives at the firm felt an “overwhelming” sense of excitement at the giant asset manager, which has been besieged with negative publicity, spotty performance in its flagship fund that Mr. Gross managed and investor outflows in that and other funds in recent months.

Sadly, the celebrations may end quickly if Kepler Cheuvreux ‘s take on the situation is proven correct.

Earlier today the French bank said that investors may withdraw a gargantuan $150 billion of Total Return Fund’s $221 billion AUM, which is also more than 10% of Pimco’s $1.44 trillion 3rd party AUM.  The report said that Pimco operating profit may drop almost 15% on withdrawals following CIO Bill Gross’s departure. Translated: no bonuses for anyone celebrating today. Of course, the shareholders were already hit when the stock of Allianz tumbled by 6% on Friday.

And if the liquidations accelerate, especially considering the woeful state of bond market liquidity these days when PIMCO suddenly becomes such a major player on the offer side the Fed may have to launch QE just to absorb what PIMCO has to sell so as to not crush the bond market, it is none other than Bill Gross who will have the final laugh, especially if he is able to pick off the bonds his former employer is liquidating in a blue light special.




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