Here’s a longer-than-usual LinkSwarm, since last week’s edition was wiped out by the ice storm power outage.
The leftwing corruption of all government institutions continues apace. “US lost 287,000 jobs while government was reporting +1 million in gains.” (Hat tip: Instapundit.)
“That’s because economic growth is slowing down,” explains research fellow EJ Antoni. “Even the areas which contributed positively to gross domestic product (GDP) are not necessarily signs of prosperity. For example, business investment grew at only 1.4 percent in the fourth quarter, but that was almost entirely inventory growth. Nonresidential investment, a key driver of future economic growth, was up just 0.7 percent.”
“Meanwhile, residential investment fell off a cliff,” Antoni continued, “dropping 26.7 percent as consumers were unable to afford the combination of high home prices, high interest rates and falling real incomes. No wonder homeownership affordability has fallen to the lowest level in that metric’s history.”
There was a gain in net exports, but that was largely a mirage created by a major slowdown in international trade. “Imports are simply falling faster than exports, which shows up as an increase in GDP.”
But probably most concerning to Antoni is the sharp decline in real disposable income in 2022, which exceeded $1 trillion.
“This is the second-largest percentage drop in real disposable income ever, behind only 1932, the worst year of the Great Depression,” he observed. “To keep up with inflation, consumers are depleting their savings and burning through the ‘stimulus’ checks they received during 2020 and 2021. Credit card debt continues growing, while savings plummeted $1.6 trillion last year, falling below 2009 levels.”
Boom. “Texas has punted Citigroup from the syndicate that’s set to manage the Lone Star state’s largest-ever municipal bond offering, saying the bank’s policies for gun retailers discriminate against the firearms industry.”
Grand Theft Pollo. The food service director of an impoverished Illinois school district was charged with stealing $1.5 million of food — most of which was chicken wings. Vera Liddell, 66, allegedly began stealing from the Harvey School District during the height of COVID-19.” (Hat tip: Dwight.)
Bill Maher continues to take regular red pills. “The problem with communism and some very recent ideologies here at home, is that they think you can change reality by screaming at it.”
We could be heroes, just for one day. Or once a month, as the case may be…
This week in rapper murders: “Tampa rapper arrested for young mother’s murder days after being acquitted of recording studio double-murder.”
A Tampa jury acquitted Billy Adams of killing two men in a makeshift recording studio in Lutz. He walked free from a Tampa courtroom on January 27.
Three days later, a young mother who was pregnant with her second child was found shot to death in a residential area of New Tampa. Her toddler was still in her vehicle nearby.
A week after her death, Tampa police said Billy Adams “did admit to being the one to pull the trigger.”
The true character and scope of the harm caused by the unprecedented mass vaccinations for COVID-19 is just now beginning to become clear. Leading scientific journals have finally begun publishing data corroborating what the underground research community has observed over the last two years, especially in relation to complex problems of immune suppression.
Truly concerning numbers pertaining to both births and mortality are also emerging.
At this moment in time, a new, allegedly super-infectious Omicron variant is all over the headlines. A sub-variant of XXB, this strain is said to possess immune escape capabilities of precisely the type that some independent researchers predicted would follow on the heels of the mass vaccinations’ narrow antigenic fixation.
The WHO maintains that worldwide, 10,000 people still die due to Covid every single day, an implausible death toll more than ten times that of an average flu. It reiterates the urgent need for vaccinations, especially in light of China’s reopening and allegedly falsified data on mortality and infections.
The EU has even called an emergency summit in light of the purported Chinese “Covid chaos” that “calls to mind how everything began in Wuhan, three years ago”.
In Sweden, the Minister for Health and Social Affairs has said he cannot rule out new restrictions, and states that everyone must take “their three doses”, since “only” 85% of the population is ‘fully inoculated’.
That such an extensive vaccine coverage has not yielded better results after nearly two years is a remarkable fact. Even more so in light of some individuals receiving four or more repeated exposures to the same vaccine antigen, yet still contracting the disease they are supposedly immunised against.
At the same time, even more ominous warning signs abound.
One such warning sign is the fact that average mortality in many Western states is still at a remarkably high level, in spite of the direct effects of the coronavirus being marginal for more than a year. Data from EuroMOMO indicate a marked excess mortality in the EU for all of 2022, and the German Bureau of Statistics reports that the country’s mortality in October was more than 19% over the median value of the preceding years.
Is this due to Covid, as the WHO’s ’10 000 per day’ figure would seem to indicate?
Blame is placed at the feet of ‘Long Covid‘ as well as the regular acute infections, but according to the EuroMOMO and Our World in Data stats, the bulk of the excess deaths in Europe during 2022 are actually not due to clinically manifest coronavirus infections.
Moreover, we shouldn’t see continued excess deaths from a respiratory virus of this kind after three years of global exposure due to the inevitable consolidation of natural immunity.
If such a situation persists, the hypothetical connection to a vaccine-related immunity suppression that just now has come into focus becomes pertinent to investigate in detail.
If, as has been argued, the vaccinations, and especially the boosters, alter the immune profile of recipients such that Covid infections get ‘tolerated’ by the immune system, it’s possible that vaccinated individuals will tend towards a situation of long-term, repeat infections that do not get cleared, and do not present with obvious symptoms, while still promoting systemic damage.
The literature now indicates an extensive substitution in the vaccinated of virus-neutralising antibodies for non-inflammatory ones, a ‘class switch’ from antibodies that work towards clearing the virus from our system, to a category of antibodies whose purpose is to desensitise us to irritants and allergens.
The net effect is that the inflammatory response to Covid infection gets down-regulated (reduced). This means that full-blown infections will present with milder symptoms, and that they won’t get cleared as effectively (partly since fever and inflammation are essential to your body getting rid of a pathogen).
That these developments alone aren’t cause for an immediate halt to the mass vaccinations, as well as thorough investigations, is astonishing.
There is of course another, and more well-known, potential partial explanation of the surprising excess mortality. We have indications of clotting disorders connected to the Covid vaccines, evident in a new major Nordic study, while repeated studies evidence a clear correlation between heart disease and Covid vaccination (see Le Vu et al., Karlstad et al. and Patone et al.).
A newly published Thai study moreover indicated that almost a third of the vaccinated youth enrolled exhibited cardiovascular manifestations, and a yet unpublished Swiss study suggests that as many as 3% of everyone vaccinated manifest heart muscle damage.
Oh, you’re serious? Let me laugh even harder. “San Francisco panel urges reparations of $5 million per black adult.”
“The embezzlement and fake kidnapping were part of the unraveling of a coal company called Signal Peak Energy that also involved bribery, cocaine trafficking, firearms violations, worker safety and environmental infringements, a network of shell companies, a modern-day castle, an amputated finger and past links to President Vladimir Putin of Russia.” There’s also a weird part…
Virginia rejects Ford battery plant plans over commie ties. “Virginia Governor Glenn Youngkin, who is a potential Republican candidate for the office of US President in 2024, rejected the $3.6 billion investment because it involved a partnership with China’s Contemporary Amperex Technology Co. Ltd., better known as CATL.” Hey Ford, have you considered possibly not teaming up with commies?
Fallout from the House speaker’s race, Biden busted for mishandling classified files, more blue state teachers raping their students, Cadillac’s EV breaks into double digit sales, and the Imelda Marcos disco musical! It’s the Friday LinkSwarm!
Kevin McCarthy finally wins Speaker of the House race on 15th vote after offering concessions to the House Freedom Caucus.
How is McCarthy doing? Early signs are encouraging. “The House of Representatives passed a new rules package Monday that overhauls the way it functions by putting up more barriers to congressional spending and creating a more deliberate process for passing legislation, which were key demands of the more conservative members of the Republican Party.” (Hat tip: Sarah Hoyt at Instapundit.)
House Speaker Kevin McCarthy (R., Calif.) used Thursday morning’s press briefing to criticize the Department of Justice’s handling of the issue.
“They knew this happened to President Biden before the election, but they kept it secret from the American public,” McCarthy told a scrum of reporters on Capitol Hill.
Chicago Board of Education Inspector General Will Fletcher reported 470 sexual complaints against Chicago Public School employees from students in 2022.
“The report details students being abused, groped, groomed, assaulted and threatened by school officials.
“One investigation found a former Junior ROTC staff member had sex with a 16-year-old high school student for a year. When he learned there was an investigation, the staff member threatened to kill the girl and her family if she cooperated with investigators.”
The teachers’ union in Chicago, Randi Weingarten’s American Federation of Teachers, so praised by Joe Biden, has done nothing and said nothing about it so far as I can tell, and I did look, focusing instead on promoting critical race theory into the school system. Left unsaid is that the union ensures that firing any of these teachers involved in this activity is virtually impossible. Chicago’s public schools’s firing rate of bad teachers owing to their union membership, as of a few years ago, is 0.1%.
What’s vivid here amid all this widespread predatory behavior from the teaching classes, which like Harvey Weinstein, are prolific campaign donors to Democrats, is that the low outrage factor stands in sharp contrast to the sexual abuse scandals of the Catholic Church, which was ordered by courts to pay billions in reparations to the victims, has seen its leaders publicly apologize for the abuses, and has many programs now to prevent child abuse by perverts in authority. This activity was evil and inexcusable and rightly punished.
As for the more widescale abuse now seen in Chicago’s public schools, along with comparable scandals in the Los Angeles public school system, and other bad cases in New York and other blue cities, well, crickets. The perversion has gotten out of control in Chicago and the story barely makes the national news.
How Biden’s inflation is destroying family budgets:
The reality of the inflation report for American families – year-over-year real wages have been negative for 21 straight months. pic.twitter.com/1Bh4DNqZBF
A federal appeals court on Friday struck down the Trump-era ban on bump stocks, a firearm accessory that enables a semi-automatic gun to shoot at an increased rate of fire.
In a 13-3 decision, the 5th Circuit Court of Appeals in New Orleans held that the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), acting under “tremendous” public pressure, short-circuited the legislative process by approving a rule to define bump stocks as “machineguns,” which are illegal to possess. The court said ATF did not have the authority from Congress to do so.
This is what a real pro-natalist policy looks like: “Hungary addresses falling birthrates by exempting moms under 30 from income tax for life.” More:
Hungary has taken several measures in recent years to encourage its citizens to have more children, including three years of paid parental leave and state-funded daycare.
The country previously suspended income tax for moms with four or more children, but this new policy specifically encourages women to have children sooner, which in the long run means a higher likelihood of having more children overall.
Israel hit Syria again, and I heard just about nothing about it. Ukraine has really pushed Syria out of the headlines.
Speaking of Ukraine, Russia has largely captured the salt mining town of Soledar, though at a high cost in man. And good luck checking those hundreds of miles of salt tunnels for partisans…
“Tesla plans Houston-area expansion with large new industrial site in Brookshire…Little is known about Tesla’s plans, but the Fortune 500 company signed a lease late last year for about 1.03 million square feet at 111 Empire West, part of the 300-acre Empire West Business Park in Brookshire.” A bold move, considering how radically car sales have dived this year.
Other EVs update: “GM delivers record Cadillac Lyriq deliveries in Q4 – 12 per month.”
“David Byrne, Fatboy Slim Disco Musical ‘Here Lies Love’ Sets Broadway Debut. The musical, which has had a long journey to Broadway, centers on the life of Imelda Marcos, the former first lady of the Philippines.” They say the mirror ball shine bright on Broadway… (Hat tip: Dwight.)
Higher inflation, widespread corruption in the federal government, the Bank of England makes Liz Truss blink, and Muslims take exception to Dearborn Public School’s gay agenda. It’s the Friday LinkSwarm!
The Journal reviewed more than 31,000 financial disclosure forms and analyzed more than 850,000 financial assets and 315,000 trades to shed light on any conflicts of interest among more than 12,000 senior career bureaucrats and political appointees. Its investigation found that “thousands of officials across the U.S. government’s executive branch disclosed owning or trading stocks that stood to rise or fall with decisions their agencies made.”
“Across 50 federal agencies ranging from the Commerce Department to the Treasury Department, more than 2,600 officials reported stock investments in companies while those companies were lobbying their agencies for favorable policies, during both Republican and Democratic administrations,” the Journal reports. “When the financial holdings caused a conflict, the agencies sometimes simply waived the rules.”
The federal employees weren’t even subtle about it. Per the Journal, “More than five dozen officials at five agencies reported trading stocks of companies shortly before their departments announced enforcement actions against those companies, such as charges or settlements.”
That’s sus.
To get an understanding of how shady this behavior is, consider examples from a few specific agencies. At the Environmental Protection Agency (EPA), for example, the Journal found that “more than 200 senior officials… or nearly one in three, reported that they or their family members held investments in companies that were lobbying the agency.”
Similar corruption plagues the Department of Defense, where, per the investigation, “officials in the office of the secretary or their family members collectively owned between $1.2 million and $3.4 million of stock in aerospace and defense companies, on average, during years the Journal examined. Some owned stock in Chinese companies while the U.S. considered blacklisting the companies.”
Sometimes there’s a major story out there you don’t have time to really pay attention to, and such is the case with the UK “mini-budget”/Bank of England story. Basically, new UK PM Liz Truss and her Chancellor of the Treasury Kwasi Kwarteng went “We’re going to cut taxes despite soaring inflation” and the Bank of England (which evidently said that UK pension funds were hours from collapse last week) went “No you’re not.” Well, Truss just blinked, Kwarteng is out, and now the UK government is going to raise taxes.
Here’s a video explainer of the complexities of the Bank of England intervention in the bond market.
I’ll still trying to wrap my mind around the phrases “pension fund margin call” and “unlimited quantity” of short term repo liquidity reserves.
The Biden administration’s new technology restrictions are already causing disruptions in China as US semiconductor equipment suppliers are telling staff based in the country’s top memory chip maker to leave, according to WSJ, citing sources familiar with the matter.
State-owned Yangtze Memory Technologies Co. has seen US chip semiconductor equipment companies, including KLA Corp. and Lam Research Corp., halt business activities at the facility. This includes installing new equipment to make advanced chips and overseeing highly technical chip production.
The US suppliers have paused support of already installed equipment at YMTC in recent days and temporarily halted installation of new tools, the people said. The suppliers are also temporarily pulling out their staff based at YMTC, the people said. –WSJ
It’s hard to overemphasize how badly screwed China’s chip industry is with this latest move. Semiconductor equipment not only needs regular maintenance, but extremely specialized expertise when something goes wrong and your yields crash, wizards who can look at a wafer defect chart and determine by experience what’s gone wrong with which tool. Without support and spare parts from the western semiconductor equipment giants, expect yields to start crashing in a matter of months, if not weeks, especially if Applied Materials and Tokyo Electron join the pullout.
The IRGC may be mobilizing retired servicemembers and other affiliated officers to suppress protests in Tehran on October 15.
Protesters have killed more Iranian security personnel in the current protest wave than in any previous wave in the regime’s history according to regime statistics.
Anti-regime protests occurred in at least 11 cities in seven provinces.
Social media accounts that are representing themselves as youth groups organizing and coordinating protests called for countrywide unrest on October 15.
Snip.
Social media accounts that are representing themselves as youth groups organizing and coordinating protests called for countrywide unrest on October 15. Dozens of social media accounts are presenting themselves as provincial components of a broader youth movement aimed at overthrowing the regime. The movement does not appear to have a central headquarters or hierarchy—at least on social media—and some of these groups’ rhetoric is notably disjointed from the others. These accounts claim to have a presence in multiple Iranian cities, including Tehran, Karaj, Neyshabour, Hamedan, Shiraz, and Ahvaz. Some of these accounts called for protests in Khuzestan on October 14, which did materialize in three different cities across the province on that date. Another account claimed that it had activated “sabotage groups” to destabilize the regime on October 14. The Tehran Neighborhood Youth group currently has the most followers and has posted for the longest period of time, possibly suggesting that it inspired copycat accounts based in other cities.
Some of these groups are presenting themselves as having moved from protest organization to coordinating phase one insurgency attacks.
In private, Democratic party officeholders are super racist.
But they’ll arrest parents and take their children if you fail to bow to their transexual madness. “Virginia Democrat Bill Would Criminally Prosecute Parents Who Don’t Affirm Their Kids As Transgender. Previous attempt at the bill was co-sponsored by a senator who served jail time for having sex with a teenager.”
A Virginia Democrat lawmaker says she will introduce legislation to have parents criminally prosecuted if they do not “affirm” their child as transgender. Teachers and social workers would report parents to Child Protective Services under the bill envisioned by state Delegate Elizabeth Guzman (D-Fauquier).
Guzman told WJLA that “It could be a felony, it could be a misdemeanor, but we know that CPS charge could harm your employment, could harm their education, because nowadays many people do a CPS database search before offering employment.”
Guzman, a social worker, went public with her plans to introduce the bill a week after The Daily Wire reported that a National Association Of School Psychologists official named Amy Cannava boasted that she was working with an unnamed state delegate matching Guzman’s description to craft such legislation. “I want to see a kid in a home with food and shelter and insurance and support, but I also don’t want to lose kids to death,” Cannava said, adding that “I will not deny the fact that I have put parents in their place in my office or at school.”
Cannava is also affiliated with a group called the Pride Liberation Project that said it would pick up trans and gay teens who didn’t like their parents, and “work with other supportive adult organizations in the region to find you someone who can provide you a kind and affirming home.”
A similar bill was quietly introduced in 2020 by Guzman and four other Democrats immediately after they took control of the legislature in the 2019 elections. It redefined the term “abused or neglected child” to include one whose parent “inflicts, threatens to create or inflict, or allows to be created or inflicted upon such child a physical or mental injury on the basis of the child’s gender identity or sexual orientation.”
The sole Senate sponsor of the 2020 bill was Joe Morrissey, who served prison time for contributing to the delinquency of a minor after sleeping with his teenage secretary. He accepted a plea deal after initially being indicted on possession of child pornography and other charges.
You know who else hates rolling out the gay agenda to public schools? Muslims.
The only religious people the left is truly scared to offend are Muslims. Criticizing Muslims is completely off the table according to the left’s rules of engagement, so if Muslims are upset about something, the amount of twisting, back-bending, and acrobatics the left will perform in order not to offend them will be something to see.
So when hundreds of Muslim parents, upset at gay porn in the school libraries, showed up to a school board meeting in Dearborn, Mich., and it devolved into shouting and chaos with board members running away and gay protesters being chased to their cars, the fallout was absolutely hilarious. The headline in the Detroit Free Press after the event went haywire was “LGBTQ and Faith Communities Struggle for Unity.” BAHAHAHAHAHAHA. Can you imagine what the headline would have been if it were a Baptist church chasing gay protesters to their cars? “Fascist White Supremacist Book Burners Bash Gay Man in Parking Lot,” or “Rabid Religious Zealots Terrorize Gay Man Defending Right to Read,” or something equally terrible. I don’t know about you, but I’m enjoying this disaster.
Enjoy this thread and all the videos in it. I know I did.
Shouting between various factions as groups take over Dearborn public schools board meeting. Board members have left. Unclear if they are coming back or if meeting will restart. Heavy police presence. pic.twitter.com/XIMEqIRR1X
Problem: Too many Germans are voting for a rightwing party the left disapproves of. Solution: Ban it. Thank God banning other political parties in Germany has never had any negative consequences…
Speaking of things that could never possibly have any negative consequences, Balarus dictator and Putin toady Alexander Lukashenko decrees that all price increases are forbidden. Enjoys those coming goods shortages, Belarussians. (Hat tip: Stephen Green at Instapundit.)
Florida Surgeon General releases study showing heightened cardiac death rates for men ages 18-39 after taking the Flu Manchu mRNA vaccine. So Twitter banned him. Thou Shalt Have No Other Gods Before The Narrative. (They later reinstated him.)
Ukrainian troops shoot down a cruise missile with a MANPADS.
Alex Jones ordered to pay $965 million to Sandy Hook families. As I noted last week, Alex Jones is an unreliable loon, but that judgment seems excessive and punitive merely for running his mouth.
Can the pound reach parity versus the dollar? It’s now a one-in-four chance when it comes to options pricing.
The UK currency is heading for its biggest daily loss since early May after Chancellor of the Exchequer Kwasi Kwarteng outlined the government’s plans to stimulate the economy with tax cuts and spending. The simultaneous sharp sell off in Gilts [historical term for UK government bonds – LP] suggests that tackling inflation will be a very hard task for UK authorities and that the currency market sees no easy way out for the Bank of England.
To attract foreign investors, a weaker pound may be the answer and that is what FX traders are betting on.
Cable fell as much as 2.1% to touch $1.1021, the lowest since March 1985, and was at $1.1036 as of 12:38pm in London. Risk reversals, a barometer of market positioning and sentiment, show that traders see the greatest downside risks for the pound over the medium term in two years.
According to Bloomberg’s options pricing model, the pound holds a 26% chance of touching parity versus the greenback in the next six months. That compares to a reading of 14% Thursday.
I think the real odds are probably higher than that.
Dollar-pound parity is something that’s never happened, with the nearest it came to some 1.05 dollars to the pound in the mid-1980s. But there’s always a first time for everything, and with the Bank of England doing more quantitative easing and the UK government going on a spending spree during soaring inflation while the Fed ratchets up interest rates, now is as good a time as any.
Besides making imports from the UK less expensive, what effects will dollar-pound parity have on the financial world? Hard to say for sure, but my prediction is: Weird things.
There are a variety of reasons for this, starting with the fact that currency trading is itself a weird thing. You may think “American financial houses buy pounds to purchase English goods, while UK financial houses buy dollars to purchase American goods,” but there’s a whole ecology of counter-party trades, hedging strategies, currency reserve requirements, portfolio balancing, and a host of other considerations.
Here’s a brief video that cover some of the basics for how brokerages handle FX trading:
That’s a fairly streamlined view, as it doesn’t cover how liquidity pools are set up, different hedging strategies, etc.
There are even traders who specialize in just trading different duration T-Bills, selling the eight-week-out and buying the four-week-out (or vice versa) for esoteric arbitrage reasons.
None of that will change if the market hits dollar-pound parity. So where’s the danger? That comes from the possible non-linear effects of the market doing something that a lot of algorithmic instrument designers never considered a possibility.
For a simple example, let’s talk about the swaps cases. To summarize a whole lot of very complex cases, a whole bunch of local UK governments entered into interest rate swap agreements. Interest rate swap agreements are a legitimate hedging strategy to minimize exposure to interest rate swings, but a few municipalities saw it as a license to print money. To quote Wikipedia, the source of all vaguely accurate knowledge:
The position of Hammersmith and Fulham London Borough Council was quite different from most of the other local authorities. From about 1985 onwards Hammersmith had entered into interest rate swap transactions on an extremely large scale. At one stage it was calculated that Hammersmith was a counterparty to 0.5% of the global trade in swaps, and 10% of the sterling denominated trade. Moreover, quite exceptionally, all of Hammersmith’s positions in the swap market were betting on a fall in interest rates. Most large participants in the swap market have their exposure balanced by taking positions on both sides and across multiple currencies, but Hammersmith was essentially repeatedly entering into one-way bets that sterling interest rates would fall; a bet that they would end up losing spectacularly when interest rates climbed from around 8 per cent to 15 per cent in the space of ten months.
This was, to put it in technical terms, “a really fucking stupid thing to do.” The swaps cases were unwound with great expense and difficulty, and various English banks ended up taking a bath (which you know they must have regarded as some sort of diabolical violation of the natural order) after courts determined that the authorities in question didn’t have the authority under English law to enter into such agreements.
The possibility that interests rates can rise should be an obvious one. But the idea that the pound might be worth less than the dollar is one that people have probably thought about a good deal less, since it hasn’t happened ever. It’s quite possible it hasn’t been contemplated in some percentage of the trillions in derivatives markets and hedging instruments around the world.
For many financial systems, this is going to be an untested use case. Some systems may work just fine, others may break down, and still others may experience race conditions or cascading failures; think of the flash crash of 2010, or the 1987 Black Monday crash. Somewhere, somehow, something is likely to go off the rails.
Hopefully, whatever does blow up won’t be big enough to take down the entire market, or at least not for long. Hopefully it won’t uncover massive problems like the 2008 subprime meltdown uncovered, and there won’t be a firm of systemic importance like AIG was there.
If you can remember all the way back to pre-Flu Manchu 2020, housing prices were soaring and there were a raft of articles decrying how commercial investors were snapping up housing as fast as they possibly could, pricing ordinary Americans out of the market.
Now, some two years later, it’s evident that a lot of those commercial investors kept buying right up through the peak of the market, and are now proceeding to lose their shirts on those deals thanks to the Biden Recession.
Take, for example, OpenDoor, the company that sends out those endless “We want to buy your home” letters. They promised investors they were going to use the Internet to revolutionize home-buying by flipping homes at scale and cut out the middle man. How well did they succeed?
Now that they’ve had a while to run their system, the answer is: Not so well.
Takeaways:
One thing I was unaware of: Commercial investors in residential real estate fund their purchases through variable interest rate debt.
OpenDoor’s outstanding debt balance “has ballooned from $271 million to $6.1 billion.”
Every point rise in interest rates costs OpenDoor $40 million more in interest rate payments.
“OpenDoor is truly a modern day house of cards. The company’s revenue grew from $1.8 billion in 2018 to over $8 billion in 2021. To grow they scaled, going from 18 markets to 44 markets in the U.S. In those four years, the company went from flipping 7,000 homes a year back in 2018 to now flipping 21, 000 homes most recently in 2021.”
“Despite OpenDoor’s top-line growth, the company has incurred loss after loss after loss, each bigger than the last, even in a strong rebound year in 2021. Where the company sold a record number of homes, OpenDoor incurred a record loss of over $600 million.”
Some math snipped. “OpenDoor would need to sell roughly sixty thousand homes a year just to break even with how much it costs the company to exist in its current burn rate. Every time the interest rate goes up a single point, OpenDoor needs to sell an additional 2,000 homes in order to offset that additional $40 million.”
The end of the video touches on how Zillow lost $881 million by trusting an algorithm that had them paying above-marker prices. We covered that briefly here some nine months ago. Here’s a video with more details:
But it’s not just OpenDoor and Zillow. Here’s a video that explains why all the large-scale commercial buyers of residential real estate (including those buying to rent it out rather than flip) are screwed by rising interest rates:
Takeaways:
The Fed “is now committing to not only continue increasing interest rates, they’re committing to keeping interest rates elevated for the foreseeable future.”
“These real estate investors are going to be losing money in the housing market on their investments, and that they are going to have to fire sale their portfolio as a result.”
“Over the last year, the investor profit or the cap rate in America is about 4.5%, which was pretty good in 2021, when interest rates were zero, but now that interest rates are projected to go to 3.8%, we can see that investors who buy real estate in America are basically getting very little premium over buying a short-term government bond.”
“As this investor demand continues to go down, home prices are also going to continue to go down in America, because in many markets investors were quarter of the demand, a third of the demand for homes over the last of couple years, and in some neighborhoods investors were 50—60% of the demand.”
“A lot of people think [commercial buyers pay] cash, but folks, it’s never cash, it’s always a bank in the background giving these hedge funds and private equity funds money to buy single-family homes.”
“They’ll give these hedge funds maybe 70—75% percent of the money to go do it, like a normal loan. The thing is, the loans that these Wall Street investors use to buy homes are often adjustable rate loans, where every time the fed hikes interest rates, the Wall Street investor has to pay more in debt service and interest on their existing portfolio.”
“We’re gonna get to a point soon over the next six months where these Wall Street investors are having to pay more to their bank and their warehouse lender than they’re going to receive in income and rent from their tenant. Like, literally, these Wall Street investors not only are going to see the value of their property going to go down, they’re going to begin losing money in terms of cash flow.”
So not only will investors have to sell, but frequently they won’t have any choice.
Because their lender, their bank, is going to do something called a margin call. At a certain point, they’re gonna say “Hey Wall Street buyer who I’m giving money to, the value of the homes has gone down and now you can barely afford to pay interest. You’re gonna have to now just pay us off, or pay us down,” and when the bank does that margin call, these investors are then going to be forced to sell off their portfolio, because they’re going to need the cash, causing a massive, widespread dump of inventory onto the U.S. housing market.
He doesn’t mention Austin by name in this video, but he does in another pegging it as the #5 market most likely to see price drops. “This is a market in absolute freefall.” “In the span of just five months, the number of homes for sale in Austin has increased from 1460 and February to nearly 8 000 in July.” He thinks home prices could down by 40%. Naturally, as an Austin-area home-owner, I think that’s way too much, but I do expect significant retreats from the highs reached early this year.
He also thinks inflation is going to get worse (which is probably a good bet).
(In another video covering some of the same ground, he mentions BlackRock, one of the biggest boogeymen in public perceptions of buying residential real estate. Guess what? “BlackRock is not a big player in terms of owning, managing and buying real estate in the U.S.”)
Like the fear of Japan buying everything in the late 1980s, fear that institutional investors will make owning a home impossible for ordinary Americans turned out to suffer from the same recency bias, assuming that what is going on right this minute will continue for the foreseeable future.
Like assuming that the giant ants are unstoppable, or that Hispanics will always vote for Democrats, assuming that housing prices will always go up and that credit will always be cheap are categorical mistakes that the market will eventually punish you for making, and the companies that made it are now bleeding red ink.
People who sold during the bubble made out like bandits, and people who bought during it got screwed, but what can’t go up forever won’t. Bubbles pop. Absent government distortions of the market*, supply and demand have a way of adjusting.
Anyway, if you need to buy a house, nine months from now is probably going to be a great buyer’s market…
*And yes, lots of cities and states try their damnedest to prevent new housing from being built. I’m looking at you, California.
Greetings, and welcome to a special Monday LinkSwarm! Still getting over a bad cold, but both the wet cough and fatigue have improved thanks to lets of bed rest.
Also on the mend: Salman Rushdie, who is reportedly off the ventilator and able to talk and joke.
Stories of unparalleled depravity: “Metro Atlanta couple charged with using adopted kids to make child porn.” I see they left out the word “gay” before couple.
Walton County couple has been arrested and are facing child sex crime charges for acts deputies say they committed against their adopted children.
Last month, the Walton County Sheriff’s Office raided a home in unincorporated Loganville where they believed a man was downloading child pornography. When interviewing him, the suspect admitted to collecting child porn and identified a second suspect in Oxford.
The suspect told deputies that the other suspect was making the child porn with at least one child who lived in his home. The first suspect’s identity has not been released.
Deputies were able to get arrest warrants for both adult men living in the home, William Dale Zulock, 32, and Zachary Jacoby Zulock, 35.
Walton County’s Division of Family and Child Services joined deputies in responding to the home to help protect the two children in the home.
After making sure the children were safe, investigators found evidence that the couple, who were the adoptive fathers of the pair of brothers living there, were recording themselves committing sexually abusive acts against the children.
"Waiting for pizza"
Zachary J. Zulock, accused of sexually abusing his adopted boys for child porn, has a long social media history of support for liberal causes. He was a big fan of #BLM, radical trans pride & the Democrat Party. One of his most used hashtags was "love is love" pic.twitter.com/Mz6cS36LOp
Speaking of the Democratic Media Complex doing it’s best to try to avoid the existence of pedophiles among its ranks, they really don’t like you using the word groomer. (Hat tip: Stephen Green at Instapundit.)
At the end of July, the Tavistock gender clinic in the United Kingdom was closed down by the National Health Service after a review of the clinic’s practices found that its “clinical approach and overall service design has not been subject to some of the normal quality controls that are typically applied when new or innovative treatments are introduced.”
In a letter addressed to the NHS, Dr. Hillary Cass, who conducted the review, wrote that other providers had “not developed the skills and competencies” necessary to provide the right amount of support to children “with lesser degrees of gender incongruence who may not wish to pursue specialist medical intervention.” Cass acknowledged that there are unanswered questions about the use of puberty blockers as a treatment for children questioning their own gender identity and suggested that much more evidence will need to be collected before she draws a conclusion on their value in these contexts.
Puberty blockers were initially developed as a treatment for precocious puberty in young children, but have since been repurposed and advertised by transgender activists as a way to hit the “pause” button and buy time for kids who think they may have been born in the “wrong body.” A sizable-but-marginalized group of doctors has long warned that the consequences of puberty-blocker use as a part of the transition process are unclear, and amount to an affirmative and significant step toward transitioning, rather than a “pause.”
The closure of Tavistock in July came as welcome news to those of us worried about the skyrocketing number of children suffering from gender dysphoria and being treated as though it were a physical malady. Then, yesterday, it was reported that a group of families in the U.K. is suing the NHS arm affiliated with Tavistock for the effects that its dogmatic approach to the treatment of youth — described by Cass as “an unquestioning affirmative approach” — had on their own lives.
A lawyer for the plaintiffs told Sky News that he believes that misdiagnoses have affected “potentially hundreds of young adults who have been affected by failings in care over the past decade at the Tavistock Centre.” It is, first and foremost, a tragedy that this has happened, but it is undoubtedly encouraging to see the mistreated join together not just to collect damages, but to tell their stories.
Moreover, the politicians in the country’s Conservative Party are showing signs that they may be willing to push back on the madness. Attorney General Suella Braverman said earlier this week that transgender theory should not be taught in schools. Penny Mordaunt, a near-finalist in the Tory leadership contest, was sunk in part because of her lack of spine on the issue.
Across the U.K., then, politicians, doctors, and activists are all beginning to recognize that the unquestioningly affirmative model of care for gender-dysphoric children is scientifically unsound, morally dangerous, and the result of, more than anything else, social and political dogma.
And the U.K. is not the first European country to begin to recognize its past mistakes. In Sweden, the use of puberty blockers and cross-sex hormones have been almost entirely ruled out for minors as of this year. Finland, meanwhile, has determined that “the initiation of hormonal interventions that alter sex characteristics may be considered before the person is 18 years of age only if it can be ascertained that their identity as the other sex is of a permanent nature and causes severe dysphoria” and “the young person is able to understand the significance of irreversible treatments and the benefits and disadvantages associated with lifelong hormone therapy, and that no contraindications are present.”
House Speaker Nancy Pelosi’s son has apparently joined the list of political offspring who magically keep landing jobs as “consultants” overseas. The Daily Mail reports:
Nancy Pelosi’s son is the second largest investor in a $22 million Chinese company whose senior executive was arrested in a fraud investigation, DailyMail.com can reveal, raising questions about his secretive visit to Taiwan with his mother.
As well as investing, Paul Pelosi Jr, 53, also worked for the telecoms company, Borqs Technologies, in a board or consultancy role, Securities and Exchange Commission documents show.
Wow, this feels like déjà vu all over again. Just substitute the name “Hunter Biden” for “Paul Pelosi Jr.” and the story would still sound credible.
For his “consultancy,” Pelosi was given 700,000 shares of stock in the company. At one time he was the second-largest shareholder in the Beijing-based firm, although it’s unclear if that’s still the case today. Either way, it must be nice. Borqs is a telecoms company specializing in the “Internet of Things” products and is “listed on the Nasdaq stock exchange with a current market capitalization of $22 million,” according to the Mail.
Hunter Biden seems to have a better nose for profitable graft corridors than Pelosi’s get, since a $22 market cap is essentially nothing in the IoT space…
The poll from the Democratic-aligned Winning Jobs Narrative Project, which surveyed 60,000 voters across 17 states, found that “making villains of corporations” and embracing “culture war topics like abortion” are ineffective strategies for Democrats. Liberals would attract more voters, in fact, if they sounded like conservatives—talking about “respect for work” and placing “government in a supporting rather than primary role.”
Voters prefer Republicans’ handling of the economy, which remains “the top issue of the coming election,” the poll found. Americans don’t believe President Joe Biden’s claims that “this has been the fastest recovery in 40 years,” instead “looking at the worst inflation in the same period and record gas prices.”
Another day, another Democratic politician refusing to pay his tax bill. “Pennsylvania Democratic Congressman Matthew Cartwright is once again in trouble for being delinquent on his property taxes. Cartwright and his wife share a condo in Washington and tax records indicate that they owed penalties and interest from 2021 due to being late in paying their taxes.”(Hat tip: Instapundit.)
Peter Zeihan (him again) spoke at Iowa’s Swine Day on the topic of Agriculture at the End of the World:
At lot of this is Zeihan’s polished Greatest Hits presentation (Deglobalization, the need to stop Russia in Ukriane to prevent a future conflict with NATO that would go nuclear, China’s demographic crash, the cult of personality/isolation of Xi Jinping, China’s absurd never-ending Flu Manchu lockdowns, etc.), but here are some highlights of specific agriculture topics:
Russia isn’t just destroying population centers in Ukraine, it’s deliberately targeting Ukraine’s agricultural infrastructure, including grain silos.
Odessa is not a normal city. It is at the mouth of the Nipur river, which is kind of their equivalent of the Mississippi, and it is also their manufacturing center. It’s a cultural hub. It’s a financial center. It is New York and Houston and St. Louis and Chicago and New Orleans all in one. And if the Russians succeed in capturing it, that is the end of Ukraine as a modern economic entity. Right now Odessa is under blockade. They can’t export anything. This has been the source of 95 of their exports to this point.
China’s pork industry got hit hard by swine flu three years ago, and they’re probably getting hit by it now.
They’re trying to regrow the swine industry with subsidies, but that’s just resulted in “Two million people who have no idea what they’re doing” buying the wrong kinds of feed.”
“If they don’t have pork, all they’ve got left is rice. Rice is the most phosphate input intensive crop.”
“The Chinese have traditionally been the world’s largest producer and exporter of phosphate, ’cause it’s a food security issue. Well they’ve stopped all exports until further notice. So we’ve lost potash because of the Ukraine War. We’ve lost phosphate because of Chinese mismanagement.”
Skipping over the oil stuff, but Texas is sitting pretty because it’s easier and quicker to bring shale oil production online.
Did I already mention that Zeihan says Russia is probably going to lose Siberian well use because if they can’t ship it off, it freezes in the permafrost?
“We’re not looking at a recession, we’re looking at an energy-induced depression that’s already affecting multiple continents. But not here…The baseline here are pretty good.”
The effect of reduced fertilizer supply to the rest of the world? “This is famine. We will have it again in the fourth quarter of this year…a half a billion to a billion people will suffer malnutrition.”
If you stop growing wheat on marginal land due to fertilizer shortage, you start growing it on your better land, and your export output collapses.
“The volume of internationally traded agricultural commodities is in the early stages of collapse.”
The Brazilian Serato is heavily dependent on external inputs from abroad. We, on the other hand, get the overwhelming majority of our fertilizer inputs nationally and from Canada.
“There is no Brazilian agricultural sector without Russian involvement. And Russian involvement is going away. It’s the world’s largest source of soy exports. And without global soy exports, there is not a global pork industry. Except here. And if we’re being nice, Canada too.”
Argentina will probably do fine as well.
“Your mid case scenario should be inflation of nine to 15% for at least the next five years.”
“You are looking at the fastest expansion in farm incomes, per person, and per acre that we have ever seen in this country’s history, and it will last for at least the remainder of this decade.”
I think Zeihan has a tendency to overstate the case sometimes, but he’s more right than wrong…
The Biden Recession continues to wreck the pocketbooks of Americans, EU economies are sucking even worse than ours, more Bidens Behaving Badly, and unlimited abortion is not nearly as popular among the American public as it is among New York Times staffers.
Support for unlimited abortion is deeply unpopular:
New Harvard/Harris poll: Huge super-majority of Americans favor 15-week abortion bans in states. Women more likely than men to favor such restrictions; men more likely to support no limitations. Just 10% of respondents agree with federal Dems' 9-month-abortion radicalism: pic.twitter.com/wyOzUPg9uE
Democrats are just tired of Joe Biden and of having to explain away his poor performance. Since Biden was elected, the only thing that has gone right is that the Covid-19 pandemic effectively ended and the unemployment rate has remained low. Inflation is out of control, gas prices are at record highs, grocery bills are skyrocketing, the stock market is getting battered and people’s 401(k)s are shrinking, crime remains high, mass shootings keep bedeviling America’s public spaces, Russia’s invading Ukraine, there’s a global food and commodity crisis, and the Taliban is running Afghanistan and oppressing women again. Democrats are apoplectic that the Supreme Court struck down Roe v. Wade, a New York State gun law, and the EPA’s right to regulate carbon emissions without explicit approval from Congress. Parents are up in arms, the teachers’ unions look like callous fools who kept schools closed and harmed a generation of schoolchildren, and “abolish the police” looks like a suicidal public policy. Republicans notice that waves of illegal immigrants headed north shortly after Biden’s inauguration and haven’t stopped coming since.
You didn’t even mention the Social Justice insanity and all the transexual madness.
That New York Times poll found that 64 percent of Democrats want a different presidential nominee in 2024. Nobody’s willing to cover for this guy anymore; no one is inclined to avert their eyes when Biden or his wife blurts out something tone-deaf now.
There are some of us who would argue that Joe Biden has always been an insecure, abrasive, presumptuous, disingenuous, demagogic, insufferable blowhard who was largely protected by a cozy, all-too-friendly relationship with a press inclined to airbrush his glaring character faults, presenting him as a wacky neighbor or a kindly, ice-cream loving grandpa.
What we see now is what happens when much of the national media, the Democratic Party establishment, and liberal interest groups stop playing along with the narrative that Biden is a wiser, sharper, kinder, more energetic and sensitive man than he is. And the truth isn’t pretty.
Speaking of unwanted Bidens: “Hunter Biden could face prostitution charges for transporting hookers across state lines and disguising checks to them as payments for ‘medical services.'” I’ll believe Hunter Biden prosecution when I see it. Also, I’ve been treating the 4Chan “Hunter Biden iPhone leak” with a certain amount of skepticism. Certainly the Hunter laptop revelations were real, and Hunter is a big enough scumbag to do the the things alleged iPhone leak materials depict. But I try to be cautious about anything that fits too neatly into my preconceptions. (Hat tip: The Other McCain.)
“Left-Wing Nonprofit Scores $171.7 Million-$1 Billion Government Contract To Help Illegal Immigrants Avoid Authorities.”
A liberal non-profit group has been given a taxpayer-funded government contract worth at least $171.7 million — which could potentially reach just under $1 billion — for assisting illegal immigrant minors in avoiding capture or incarceration by U.S. Border Patrol and state officials.
The Department of the Interior was the awarding agency and “The Vera Institute of Justice,” based out of New York — which supports the “defund the police” movement and has lax views on immigration enforcement — was the beneficiary.
Thanks in part to a lack of zoning, Houston builds housing at nearly three times the per capita rate of cities like New York City and San Jose. It isn’t all just sprawl either: In 2019, Houston built roughly the same number of apartments as Los Angeles, despite the latter being nearly twice as large. This ongoing supernova of housing construction has helped to keep Houston one of the most affordable big cities in the U.S., offering new arrivals modest rents and accessible home prices even amid seemingly endless demand.
Houston is by no means a model for planning. Like every other Sun Belt city, it struggles with segregation and sprawl. Yet its continued success as one of America’s most affordable and prosperous cities reveals the workability—indeed, the desirability—of non-zoning. Houston is a profoundly weird place, resistant to seductive oversimplifications. But it provides insight into what comes after the arbitrary lines that have misshapen our cities—and how we might get there.
So why didn’t Houston adopt zoning like every other U.S. city? The answer comes down partly to process. Unique among major cities, Houston subjected zoning to a citywide vote. While most city councils had, historically, quietly adopted zoning after a few perfunctory public hearings, the Bayou City invited voters to decide on zoning in 1946, 1962, and 1993. Voters rejected it each time—a reality that calls into question the often-postulated popularity of zoning.
Zoning critics rightly dispensed with the comforting myths surrounding zoning—that its purpose was to merely rationalize land use—and zeroed in on its tendency to restrict new housing construction, limit access to opportunity, institutionalize segregation, and force growth outward. Far from being duped, Houston’s working-class residents exhibited a subtler understanding of the purposes of zoning than many contemporary planners and rejected it accordingly.
But the answer to why Houston remains unzoned also comes down to politics. Zoning proponents didn’t merely lose the referendums—they were also tactfully bought off by being allowed to have something resembling zoning in their immediate vicinity. Indeed, the dark little secret of non-zoning in Houston is that it depends on a system of land-use regulations known as deed restrictions, which empower certain communities—principally middle- and upper-class homeowners—to effectively “opt out” of non-zoning, writing their own land-use rules for their own neighborhoods. In exchange, Houston is able to protect the vast majority of the city from the types of arbitrary-use distinctions, density limits, and raucous public hearings that cause so much harm in every other U.S. city. That is to say, in exchange for respecting pockets of private land-use regulation, Houston is able to grow, adapt, and evolve like no other city.
Deed restrictions are private, voluntary agreements among property owners—typically the homeowners of a particular subdivision or neighborhood—regulating how they can and cannot use their land. These rules are literally tied to the deed, meaning that a property owner must agree to them as a condition of the sale. Since the failed 1962 zoning referendum, the city has enforced these agreements on behalf of the relevant parties, refusing to issue permits that run afoul of their provisions and bringing legal action against violators.
Is this system of publicly enforced deed restrictions “basically zoning,” as some might argue? On the one hand, deed restrictions—like zoning—demarcate specified areas subject to a distinct set of stricter land-use rules. Both zoning and deed restrictions in Houston are enforced by the government, principally with the aim of propping up home values and maintaining a certain quality of life. Many deed restrictions even have rules banning apartments and enforcing a strict two-and-a-half-story height limit.
Yet, the similarities end there, and Houston’s system of deed restrictions is a significant improvement over zoning. For starters, deed restrictions only cover an estimated quarter of the city, largely in areas with low-rise, detached, single-family housing. Industrial areas, commercial corridors, mixed-use and multifamily neighborhoods, urban vacant lots, and yet-to-be-developed greenfields are virtually never subject to their provisions. This means that roughly three-quarters of Houston—including its more dynamic sections—are largely free to grow without anything even resembling zoning holding them back.
Another key difference is that deed restrictions must be voluntarily opted in to. This serves to discipline deed restrictions in a way that is rarely true of zoning: If the rules are stricter than what prospective homebuyers might prefer, or not strict enough, or simply focus on the wrong concerns, this may translate into lower home values. This in turn nudges homeowners to think through the optimal form of land-use regulation to a degree that rarely happens with zoning.
After deciding to let drug-abusing transients use their restrooms, Starbucks is now closing 16 stores because of rising violence, and the fact that transients are shooting up in their restrooms. Golly, who could have possibly seen that coming?
Another Texas school superintendent has stepped down amid criticism from parents concerned about liberal indoctrination in their children’s classrooms.
At a special meeting Monday afternoon, Clear Creek Independent School District’s board of trustees accepted the retirement of Superintendent Eric Williams, effective in January 2023.
Conservative parents in the Houston-area district had complained that Williams, who started in early 2021, was subjecting their students to liberal ideologies he brought from his former job as superintendent of
The Fed goes Volcker, more Welcome Back Carter cosplay, Big Yellow moves to Texas, and Florida Man makes a run for the ocean.
FYI, Blue Host has been acting weird today, giving errors when you tried to save, even though everything appears to be there upon reloading. (Shrugs.)
Fed hike rates 75 basis points. The attempt to Volckerize inflation during the Biden Recession has begun.
Speaking of St. Volcker, there were a lot of other factors that helped kill inflation in the early 1980s:
Oil was one of the primary causes of the 1970s inflation and everyone remembers the oil crisis. During the decade, oil ran all the way from $2 to $39. However, the flipside to this story is that with a lag, high oil prices will eventually incentivize production. The issue was that the US specifically disincentivized US producers and importers. Ronald Reagan signed an Executive Order in January of 1981 to eliminate oil price controls and then removed Jimmy Carter’s idiotic Windfall Profits Tax a few years later. As expected, global production expanded rapidly and with the removal of price controls, that production flooded into the US. By the middle of the decade, despite repeated production cuts by OPEC, there was a global glut of oil and by 1985, oil had collapsed all the way to $7. It wasn’t interest rates that made oil decline, it was government policy on the deregulation side, along with rapid production increases from non-OPEC countries.
President Reagan’s Economic Recovery Tax Act was signed into law in August of 1981, designed to reduce tax rates and incentivize investment by rewarding risk-taking by businesses. In particular, the Accelerated Cost Recovery System served to accelerate depreciation, reducing taxes for those that invested in productive capacity. Once again, government policy, not interest rates led to an increase in investment and ultimately supply, helping to tame inflation.
It wasn’t just Reagan working on de-regulation; The Staggers Act of October 1980, deregulated the railroads, The Motor Carrier Act of July 1980, deregulated the trucking industry, and the Airline Deregulation Act of October 1978 effectively deregulated transport industries. The net effect was dramatic price competition, better ability to invest and innovate, and the ability to eliminate unprofitable business that was funded by profitable business. Almost immediately after passage, pricing for transport services collapsed and the ease of transporting goods expanded.
Organized labor was also dealt a near-fatal blow when Reagan fired the air traffic controllers in August of 1981. This may have reduced the wages for a generation of middle-class workers, but it sure wasn’t inflationary. It also accelerated the decline of unions which had already peaked out as a percentage of workers. More importantly, it reduced the militancy of unions and took the teeth out of their ability to disrupt businesses, leading to better efficiency and lower costs for consumers.
At the same time, when it comes to macroeconomics, demographics equals destiny. In this case, Volcker simply got lucky. Think of the Baby Boom generation, the last of whom was born in 1964. By 1982, these last Boomers hit 18 and started joining the workforce. The eldest Baby Boomers, born in 1946, were already 36 by then. Look at the massive increase in workers starting in the late 1970s and into the 1980s, which tamped down wages and tamed inflation—especially as female participation in the workforce expanded dramatically. This added labor slowed a key component of the inflation.
The Biden Administration looks capable of pursuing none of those policies, and the Baby Boomers are starting to retire…
How did we get here? Well, in addition to those SUPERgeniuses in the Biden Administration, decades of deficit spending, and loose Fed money printing, there’s the Flu Manchu lockdowns.
For weird reasons, some people, many people, imagined that governments could just shut down an economy and turn it back on without consequence. And yet here we are.
Historians of the future, if there are any intelligent ones among them, will surely be aghast at our astounding ignorance. Congress enacted decades of spending in just two years and figured it would be fine. The printing presses at the Fed ran at full tilt. No one cared to do anything about the trade snarls or supply-chain breakages. And here we are.
Our elites had two years to fix this unfolding disaster. They did nothing. Now we face terrible, grim, grueling, exploitative inflation, at the same time we are plunging into recession again, and people sit around wondering what the heck happened.
I will tell you what happened: the ruling class destroyed the world we knew. It happened right before our eyes. And here we are.
Last week, the stock market reeled on the news that the European Central Bank will attempt to do something about the inflation wrecking markets. So of course the financial markets panicked like an addict who can’t find his next hit of heroin. This week already began with more of the same, for fear that the Fed will be forced to rein in its easy-money policy event further. Maybe, maybe not; but recession appears impending regardless.
The polling error for the 2020 election was roughly 4% nationwide, the largest in the last 40 years.
Fast-forward to today. Inflation is 8+ percent, the price of food and gasoline is way up, crime is up, there is a nationwide shortage of baby formula, and don’t get me started on the border crisis. Yet Joe Biden’s job approval is close to 40% positive. That means almost four out of every ten Americans think Joe is doing a good job if you believe the RealClearPolitics average. And I don’t.
Snip.
If the polls are overestimating approval numbers for Biden and other Democrats, how bad is it? The political climate today is different since the 2020 election, but the Democrat poll bias seems intact, which was 4% nationwide. Since nonresponse bias, 4%, and registered voter bias, 2.6%, should be mutually exclusive, we can add them together. This gives us a total Democrat bias of roughly 6.5%
What does this mean? Until pollsters switch to sampling likely voters right before the election, you can subtract a solid 6 percent from Joe Biden’s approval numbers. And if nothing changes before the election, any Democrat who leads by 3 percent or less is likely to lose.
Texas Attorney General Ken Paxton is enjoying a victory against a Biden administration policy that has allowed illegal aliens to cross the southern border without consequence.
In 2021, President Joe Biden’s Department of Homeland Security issued a rule giving immigration law enforcement officials the power to decide whether or not to detain illegal aliens who attempt to cross the border (in contradiction to federal law, which says they must all be detained).
This policy caught the attention of Texas Attorney General Paxton and Louisiana Attorney General Jeff Landry, who sued to stop the rule change, arguing that Biden was violating federal law when refusing to take custody of criminal migrants.
Paxton bashed President Biden, arguing that the policy was contrary to federal law and was instituted without following the proper procedure. Over a year since the original lawsuit was filed, a federal judge issued a ruling against the Biden administration on Friday.
Federal District Judge Drew Tipton said in his decision that the rule was “an implausible construction of federal law that flies in the face of the limitations imposed by Congress.” Tipton added, “Whatever the outer limits of the authority, the executive branch does not have the authority to change the law.”
After a legal fight lasting almost a year, Texas judges ruled a final judgment banning Biden’s detention-discretion rule.
Speaking of Musk: Several snowflakes working at SpaceX circulated a letter calling Musk “an embarrassment” and demanding the company be more “inclusive.” Result: He fired their ass. Good.
San Antonio symphony orchestra shuts down and files for Chapter 7 bankruptcy. “The last bargaining session between the Symphony Society and the Musicians’ Union took place on March 8, 2022 after which the Union declined to return to the bargaining table, despite efforts of federal mediators and the Symphony. The Musicians’ Union has made it clear there is no prospect of the resumption of negotiations, absent the Board agreeing to a budget that is millions of dollars in excess of what the Symphony can afford.” (Hat tip: Dwight.)
