Drug addiction

Presumably…

…misandristic slogans will be OK in the People’s Democratic Republic of Victoria.

The bigger question is who will be the arbiter of what is deemed inappropriate or not? We can absolutely bet the farm that the people selected to enforce this being the least qualified in being able to administer it fairly.

No one should have an issue with holding appropriate standards for slogans on vehicles (e.g. no profanity/nudity) but is there a pressing need to have apparatchiks pushing agendas on what they deem appropriate for the rest of us? How many vehicles fall foul of these crimes?

One can be certain that if a car is adorned with slogans that crudely vilify white heterosexual Christian males it won’t be deregistered. Perhaps Victoria should change its number plate slogan to “Victoria – the re-education state.

Perhaps Victorian Premier Dan Andrews should spend more time reflecting on his injecting room policy where the CEO of the centre has been stood down after some staffers were caught dealing drugs to the addicts that use the facilities. Who’d a thunk?

Utterly clueless

Zion Lights, a spokesperson for Extinction Rebellion (XR), is shown up by Andrew Neil for what the movement is – completely devoid of any sensible and rational knowledge of the subject they purport to know back to front.

Even the most extreme alarmist claims are treated with a level of high confidence and certainty. Lights doesn’t even accept the premise that the idea of billions dying is that far fetched. She simply deferred to the delusions of the lunatic scientists (highly questionable) who clearly made up such bogus claims as if it was a mathematical guarantee. She even thought banning aviation for a 0.03 degree temp change would be worth it.

When Neil suggested that most homes in Britain are heated by gas and/or use it for cooking, the idea that the UK be carbon neutral by 2025 was a long shot. Lights replied, “we put a man on the moon before we had mobile phones and the internet.” Sadly, it took the US more than 6 years to achieve that. Never mind, XR will demand billions are poured into research that will have no impact on the planet.

With that level of logic, we should definitely accelerate the idea of letting XR run our government with citizen’s assemblies. Utterly clueless, just like those councils and governments calling climate emergencies.

Ford downgraded to junk

This week, Ford Motor Co’s credit rating was downgraded by Moody’s to junk. $84bn worth of debt now no longer investment grade. It will be the first of many Fortune 500s to fall foul to this reality. In 2008, there was around $800bn of BBB status credit. That number exceeds $3.186 trillion today.

CM has long argued that the credit cycle would be the undoing of the economy. For too long, corporates binged on easy money, caring little for credit ratings because the interest spreads between AAA and BBB were so negligible. The market ignored risk and companies went hell for leather issuing new debt to fu buybacks to artificially prop up weak earnings to give the illusion of growth.

Sadly this problem is likely to cause widespread sell offs by companies/investors which must stick to products (as woefully yielding as they may be) with an investment grade, exacerbating the problem of refinancing debt close to maturity. The thinking during easy credit times was simple – refinancing could be done with low interest rates because there was no alternative.

This is problematic for three reasons:

1) under the Obama era, much of the newly issued debt was short term meaning $8.4 trillion arrives for refinancing in the next 2.5 years, crowding out the corporate market.

2) more than 50% of US corporates are one notch above junk status. Refinancing will not be a simple affair.

3) more and more investment grade debt will be driven to zero or even negative yields as a result further exacerbating the problems for insurance companies and pension funds dealing with massive unfunded liabilities.

Last year, in relation to unfunded liabilities at US public pension funds, CM wrote,

California Public Employee Retirement System (CalPERS) lost around 2% of its funds in 2015/16. The fund assumed an aggressive 7.5% return. Dr. Joe Nation of Stanford Institute for Economic Policy Research thinks unfunded liabilities have surged to $150bn from $93bn in the last two years. He suggested the use of a more realistic 4% rate of return last year. At that rate, CalPERS had a market based unfunded liability of $412bn (or the equivalent of 2 years’ worth of California state revenue). At present Nation now thinks the number is just shy of $1 trillion using a 3.25% discount rate. He expects that the 2017 data for CalPERS will be out in a week or so which should give some interesting perspective as to how much deeper the pension hole is for Californian public servants.

N.B. California collects $232bn in state taxes annually in a $2.3 trillion economy (around the size of Italy).”

This is just California, which in the last 8 years has seen a 2.62-fold jump in the gap between liabilities and state total expenditures.

Unfunded liabilities per household. In California’s case, the 2017 figure is $122,121. In 2008 this figure was only $36,159. In 8 years the gap has ballooned 3.38x. Every single state in America with the exception of Arizona has seen a deterioration.

Switching to Illinois, we have a case study on what happens when pension funds go pear shaped.The Illinois Police Pension is rapidly approaching the point of being unable to service its pension members and a taxpayer bailout looks unlikely given the State of Illinois’ mulling bankruptcy.

Local Government Information Services (LGIS) writes, At the end of 2020, LGIS estimates that the Policemen’s Annuity and Benefit Fund of Chicago will have less than $150 million in assets to pay $928 million promised to 14,133 retirees the following yearFund assets will fall from $3.2 billion at the end of 2015 to $1.4 billion at the end of 2018, $751 million at the end of 2019, and $143 million at the end of 2020, according to LGIS…LGIS analyzed 12 years of the fund’s mandated financial filings with the Illinois Department of Insurance (DOI), which regulates public pension funds. It found that– without taxpayer subsidies and the ability to use active employee contributions to pay current retirees, a practice that is illegal in the private sector– the fund would have already run completely dry, in 2015…The Chicago police pension fund held $3.2 billion in assets in 2003. It shelled out $3.8 billion more in benefits to retired police officers than it generated in investment returns between 2003 and 2015…Over that span, the fund paid out $6.9 billion and earned $3.0 billion, paying an additional $134 million in fees to investment managers.”

Therefore Ford’s downgrade to junk will have the effect of repricing over a decade of misplaced central bank policy across all markets. The dominos are only beginning to fall. The market can absorb Ford’s downgrade but not if it has to deal with the panic of dozens like it.

CM has long been warning of GE. Despite being the world’s largest stock in 2000, it is 1/5 the size today, trades in negative equity, wasted $45bn on share buybacks in 2015/16 and were it be classified as junk would increase the pile of junk by 10% on its own. Broadcom and American Tower are other monsters ready to be hurled onto the ratings scrap heap.

Buy Gold. The US Fed will likely embark on QE. It requires an act of Congress to approve the purchase of equities but don’t be surprised if this becomes a reality when markets plunge.

This will be the reset of asset prices which has been long overdue thanks to almost two decades of manipulation by authorities. It has 1929 written all over it. Not 2008.

Which Doctors or Witch Doctors? AMA needs to remove its head from its own backside

Ideology and medicine shouldn’t mix. The Australian Medical Association (AMA) has taken on the role of a tribal witch doctor. It is more worrying that the very people we are supposed to put our faith in on the operating table have such ridiculously unfounded views in a field that is off their patch. Moreover, its assessment is flatly wrong.

Have they got hard evidence to back the claims? Not even the cheerleaders among alarmists back their claims. Yet watch the media fall into line with this utter garbage.

Here are some of the AMA’s reasons below.

“Climate change will cause higher mortality and morbidity from heat stress.”

– The reality is that more people die from cold weather events than hot. According to a 2014 study by the CDC, approximately 1,300 deaths per year from 2006 to 2010 were coded as resulting from extreme cold exposure, and 670 deaths per year from extreme heat. FAIL.

“Climate change will cause injury and mortality from increasingly severe weather events.”

The ‘Uncertainties in Greenhouse Gas induced climate change report of 2000 notes, that,

“A causal and unequivocal link between mean surface temperature increase and the anthropogenic greenhouse gas increase has not yet been established. The most probable cause of the mean surface temperature increase is considered to be a combination of internally and externally forced natural variability and anthropogenic sources. Significant uncertainty still exists relating the total (direct plus indirect) radiative forcing by anthropogenic aerosols (e.g. sulfate, black carbon, dust etc.). Recent studies suggest that the negative total radiative forcing by anthropogenic aerosols may offset the positive forcing by the greenhouse gases. Precipitation trends in different regions of the world do not present conclusive evidence about the intensification of the hydrologic cycle of the atmospheric-ocean system. There is still uncertainty relating trends in storm (tropical as well as extratropical) frequency in different parts of the world. Available climate data do not show any increasing trend in extreme weather events (e.g. extreme precipitation, extreme drought thunderstorms, winter blizzards) in any part of the world.FAIL

“Climate change will cause increases in the transmission of vector-borne diseases.”

A 2016 NIH report titled,  ‘Climate change effects on airborne pathogenic bioaerosol concentrations: a scenario analysis‘ noted,

The single receptor results showed that modelled concentrations were modified (on average decreased) several percentage points on average as a result of climate change. In general, the variables wind speed and global radiation were of most importance, by influencing atmospheric particle dilution. An increase in global radiation (and temperature) enhances vertical atmospheric mixing and thus results in lower surface concentrations. An increase in wind speed enhances horizontal spread, and thus, the concentration at a receptor point at the plume axis (as in our study) decreases. From our spatial analysis, we concluded that distribution of the area at risk, however, changed: in some areas, the seasonal-averaged concentrations decreased (up to 20 %)

…Given the fact that most human infections occurred in spring, the 2009 concentrations were not exceptional...”

We concluded that for four out of five scenarios the concentrations generally decrease as a result of increased global radiation, temperature and increased wind speeds, whereas for one scenario the concentrations generally increase. Nevertheless, the differences between and especially within seasons are large. Since coincidence of emission and specific meteorological conditions largely determines the actual exposure, additional investigations are required to further quantify the change in predicted concentrations of airborne pathogenic bioaerosolsby taking into account pathogen inactivation and more detailed probability functions on precipitation, snow and large-scale circulation.” FAIL

“Climate change will cause food insecurity resulting from declines in agricultural outputs.”

The IPCC Synthesis Report (i.e. summary) states: “By 2020, in some countries, yields from rain-fed agriculture could be reduced by up to 50%.”  This is properly referenced back to chapter 9.4 of WG2, which says:  “In other countries, additional risks that could be exacerbated by climate change include greater erosion, deficiencies in yields from rain-fed agriculture of up to 50% during the 2000-2020 period, and reductions in crop growth period” (Agoumi, 2003).

Agoumi study wasn’t a peer-reviewed document.

It is noteworthy that chapter 9.4 continued with “However, there is the possibility that adaptation could reduce these negative effects (Benhin, 2006)…not all changes in climate and climate variability will be negative, as agriculture and the growing seasons in certain areas (for example, parts of the Ethiopian highlands and parts of southern Africa such as Mozambique), may lengthen under climate change, due to a combination of increased temperature and rainfall changes (Thornton et al., 2006). Mild climate scenarios project further benefits across African croplands for irrigated and, especially, dryland farms.” 

The same goes for chocolate…

Half of the world’s chocolate is currently sourced from just two African countries: Côte d’Ivoire and Ghana. According to the IPCC, rising temperatures and a relative reduction in rainfall could make it less suitable for cocoa production in the future. The research highlighted in the IPCC Climate Change 2014: Impacts, Adaptation, and Vulnerability report indicate that, under a “business as usual” scenario, those countries will experience a 3.8°F (2.1°C) increase in temperature by 2050 which could seriously impact cocoa production.

Claims that changes to the climate are also pushing cocoa-growing regions to higher altitudes in some parts of the world, which can make some crops unsustainable…production has more than doubled in the past 3 decades. FAIL

“Climate change will cause a higher incidence of mental ill-health.”

By opening its mouth the AMA would seemingly be assisting the business fortunes of psychologists. Perhaps the AMA should check into its own facilities.

Honestly, we must conclude that climate alarmism is in the final throes. With all these local councils declaring climate emergencies and now the AMA joining the RBA and APRA on climate activism, we should start to discount their opinions on their core subjects. Utterly pathetic.

Perhaps the AMA should demand that all of our hospitals are run off renewables with no baseload back up power. Gotta practice what it preaches!

Political shots fired. Media misses the target as usual

Never put it past the media or the political class to maximize tragedy for their own personal gain. It is truly sick. Beto O’Rourke blamed the shootings in El Paso and Dayton to Trump’s hatred being on a par with the Third Reich. Seriously? Congresswoman & ‘The Squad” member Rashid Tlaib lashed out at Ivanka Trump for expressing sorrow for the attacks by making attacks on her father’s “hate agenda and racism“, which is a touch ironic coming from an anti-Semite and a minority that has somehow overcome this imaginary racism and hatred to be elected to represent America on a national level. Do Trump’s “thoughts and prayers” solve anything? No.

Sadly even if Trump were to ban guns, the liberal left would give him zero credit for it. So what does he stand to gain? That isn’t an excuse to do nothing either. How is that within several hours of these shootings we have full dossiers on the perpetrators – political affiliation, tweets of racist rhetoric and photos from their childhood? How quickly acquaintances of perpetrators all knew these people were capable of massacres…

One shooter had tweeted support for Trump. The other was a registered Democrat. What does this actually prove? Do all 63m Trump voters and all 66m odd Hillary Clinton voters to a man and woman share a certain slice of DNA with these abhorrent individuals? Does skin colour actually matter? To shoot up a Walmart or other public area requires a special kind of lunacy. These two represent 0.00000154% of those voters in the 2016 election.

If so much information can be garnered within such a short time, why don’t regulators clamp down on checks so the system has a higher chance of catching potential loonies?

Unfortunately these shootings will be forgotten in a few weeks as per usual and Americans will get on with their daily lives. This is nothing but a political football. The reality is that the people most affected (the murdered & their families) are ranked last as debate gets stifled by politicians looking to maximize exposure from the tragedy. Remember you’re a racist, bigoted Nazi if you want to protect 2A. Not a very good starting point to solve a problem.

Yet the media can’t move away from the “if it bleeds it leads” narrative. It jumps on the finger pointing blame game to recover decimated rankings.

Yet what of the stats of gun crime in America?

There are 50,000 (mostly individual) gun stores in the US. 95% of firearm related murders are committed with handguns. Statistically America would be better off banning sales of pistols rather than AR-15s. Say automatic rifles are banned from today. What will change? Handgun murders will move closer to 100%. Good luck buying back 300m+ guns in America.

According to the Crime Prevention Research Center, murders in US appear to be very concentrated: 54% of US counties (representing 11% of the population) in 2014 had zero murders, 2% of counties made up 51% of the murders, ironically in states with the strictest gun controls – Illinois, NY and California.

Yet America has had decades of periods where governments had majorities in both houses and nothing was done on gun control. We’ve experienced Orlando, Las Vegas, Sandy Hook, Columbine, Parkland, Fort Hood, El Paso, Dayton, San Bernardino, Virginia Tech, Geneva County, Aurora…the list goes on.

Moves by sporting goods stores like Dick’s to ban AR sales and raise the age limit to 21yo looked sensible from the outside. However they had multiple massacres over decades to make that call. The current CEO has been in charge since 1984. Why the u-turn in his conscience? Indeed the company did temporarily suspend sales of ARs after Sandy Hook in 2012 but kept retailing them at the company’s Field & Stream outlets before selling them again at Dick’s. Inconsistent.

Recall the Parkland, Florida school shooting. At the time media outlets went all guns blazing on the National Rifle Association (NRA), CM warned that it most likely would cause a knee jerk reaction in the opposite direction. We speculated that the hike in membership fee likely reflected a surge in members. As tragic as the Parkland massacre was, CM said that ‘shaming’ NRA members en masse would only make them dig in deeper. As it turns out searches for NRA membership surged 4900% immediately after the tragedy. People are sick and tired of being bullied into feeling guilty about things they haven’t caused.

39,773 died from gun related death in America in 2018. The highest number in 20 years. Statistically speaking ‘massacres’ accounted for only 106 deaths in 2018 or 0.27% of the total. Yet media attention focuses on it.

To put it into perspective the total number of overdose deaths involving heroin from 2002 to 2015 jumped 6.2-fold in the US. Automobiles killed around 32,000 people last year or a little over 2x that of heroin overdoses. When adding non-methadone opioids (illicit fentanyl) overdose that number surged to 20,000, a 33% YoY jump on 2014 and 5.9x 2002. Why is it happening? The problem for many prescription painkiller users is that once their bottle ends, the addiction doesn’t stop meaning many switch to heroin to get the same ‘opioid’ hit.

We armchair politicians can sit back and shake our heads at America. Yet until there is a will of the people to change the laws, expect more massacres to happen. Name an American politician that is willing to repeal 2A as a cornerstone election campaign policy. There is your answer. Will the Democrat nominees raise their hands for the repeal of 2A? Safer to raise hands at free healthcare for illegal immigrants. 2A is toxic to touch. Sadly innocent people are dying for no reason.

Tarzan of the Ocean

This brave member of the US Coast Guard leapt onto the top of a drug smuggling submarine used by the cartels and politely knocked on the hatch for a quick chat.

For all those who disrespect the flag, here is another good reason why they shouldn’t. Brave souls putting their own lives on the line to keep a country safe.

This chap helped seize $232m worth of narcotics.

Video here.

RBA should expect a dead cat bounce from the rate cut

The RBA has cut rates to a record low 1.25%. The irony here is people and businesses invest because they see a cycle, not because interest rates are low. Lowering rates will do little to spur investment, especially as the global economy cools.

Post the Hayne Royal Commission, the banks will likely pass on the full amount which will only impact margins and weaken them given the high reliance on wholesale funding.

The other problem the RBA faces is that banks have become so reluctant to lend post the RC that the net impacts of the rate cut will be negated by the unwillingness to lend at levels we have seen in the past given the penalties associated with it.

CM still contends that the Aussie banks tread a perilous path given their leveraged balance sheets. CM thinks part nationalization or worse is a real prospect if the slowdown is severe enough. The equity buffers are tiny relative to the real estate portfolio. All contained in the above link.

The rate cut is unlikely to boost confidence other than loosen the noose around stretched borrowers’ necks.