Month: August 2019

It Only Took 5 F%$#ing Years

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Daniel Pantaleo, the New York cop who choked Eric Garner to death, has finally been fired.

None of the other Cops, who falsified their reports, are facing any sort of consequences for their actions.

But really, this shouldn’t take 5 years. He should have been fired in 5 months:

The New York City police officer whose chokehold led to Eric Garner’s death in 2014 was fired from the Police Department and stripped of his pension benefits on Monday, ending a bitter battle that had cast a shadow over the nation’s largest police force.

Commissioner James P. O’Neill’s decision to dismiss the officer, Daniel Pantaleo, came five years after Mr. Garner’s dying words — “I can’t breathe” — helped to galvanize the Black Lives Matter protests that led to changes in policing practices in New York and around the country.

Officer Pantaleo had held on to his job as the Staten Island district attorney and the Justice Department declined to charge him with a crime in the face of calls by the Garner family and their supporters that the city punish him and other officers involved.

Commissioner O’Neill dismissed Officer Pantaleo just over two weeks after a police administrative judge had found him guilty of violating a department ban on chokeholds.

The commissioner gave an emotional explanation laced with sympathy not just for Mr. Garner, but for Officer Pantaleo, and said he had agonized over the decision. He said he might have made similar mistakes if he had been in Mr. Pantaleo’s place, and noted that Mr. Garner should not have resisted arrest when he was stopped and accused of selling untaxed cigarettes.

Still, the commissioner said, Officer Pantaleo had failed to relax a grip on Mr. Garner’s neck after he tackled him to the ground, and his recklessness triggered a fatal asthma attack.

The fact that this took so long, and that the other officers who lied will face no consequences for their actions, is indicative of a profoundly corrupt law enforcement, and criminal justice, syste,

Quote of the Day

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For all this, every time Trump seems headed for the dustbin of history, he bounces up again off the messageless paralysis of his Democratic opposition. When Trump vanquished a giant primary field of Republicans in 2016, Democrats cheered. When they lost the general election, they acted like it was an unrelated surprise event, an outrage to decency itself. They remain ineffective as anything but a punchline to the Trump story.

—Matt Taibbi

The Democratic Party is the Washington Generals of  ……… well ……… Washington.

Live in Obedient Fear, Citizen

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The Portland, Oregon police, last seen colluding with Neo-Nazi white supremacists, has reached new heights in complete f%$#ery when it Photoshoped a booking photo of a suspect in order to get witnesses to pick him out of a photo lineup:

There’s no mistaking the elaborate tattoos that cover Tyrone Lamont Allen’s forehead and right cheek.

But when Portland police suspected Allen was involved in four bank and credit union heists, and none of the tellers reported seeing tattoos on the face of the man who robbed them, police digitally altered Allen’s mugshot.

They covered up every one of his tattoos using Photoshop.

“I basically painted over the tattoos,’’ police forensic criminalist Mark Weber testified. “Almost like applying electronic makeup.’’

Police then presented the altered image of Allen with photos of five similar-looking men to the tellers for identification. They didn’t tell anyone that they’d changed Allen’s photo.

Some of the tellers picked out Allen.

The practice came under fire this week in a federal courtroom in Portland as Allen’s attorney argued that the manipulation allowed police to “rig the outcome” of the photo lineup.

Gee, you think?

Someone should go to jail over this.

They should, but they won’t.

From the Department of About F%$#ing Time

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This program has been documented since before Google bought them, and only now are they taking action:

YouTube is going after an alleged copyright troll using the Digital Millennium Copyright Act’s (DMCA) provisions, alleging that Christopher Brady used false copyright strikes to extort YouTube creators, harming the company in the process. Now, YouTube is suing Brady, using the DMCA’s provisions against fraudulent takedown claims, seeking compensatory damages and an injunction against future fraudulent claims.

The lawsuit, first spotted by Adweek reporter Shoshana Wodinsky, alleges that Brady sent multiple complaints claiming that a couple of Minecraft gaming YouTubers — “Kenzo” and “ObbyRaidz” — infringed on his copyrighted material in January. (Their legal names were not listed in the lawsuit.) YouTube removed the videos that Brady claimed were infringing on his copyrighted material, as the company does whenever a claim is submitted.

ObbyRaidz was sent a message from Brady, according to the lawsuit, that stated if the YouTuber didn’t pay Brady $150 via PayPal (or $75 in bitcoin), he would issue a third copyright strike. This would essentially terminate ObbyRaidz’ channel and remove all of his videos from the platform. Kenzo was sent a similar message, but Brady requested $300. ObbyRaidz spoke about the situation in a video, noting that he made multiple attempts to get in touch with someone at YouTube but didn’t make any progress.

Of course he couldn’t contact a human being.  That is the primary goal of all Google customer support, which opens up all its platforms to scammers and fraud.

Linkage

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Pretty Much:

Overpriced and Underperforming

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Pathetic

Over a quarter century into the program, the F-35 fleet is still exhibiting abysmal readiness rates.

This ia particularly concerning given that one of the selling points of the mistake jet was increased reliability:

The F-35 Joint Strike Fighters in the operational test fleet at California’s Edwards Air Force Base are suffering from low readiness rates that may threaten the successful completion of the crucial combat-testing phase of the program, as shown in a chart created by the Joint Program Office’s Integrated Test Force and obtained by the Project On Government Oversight (POGO).

The revelation that the F-35 program is struggling to overcome the last hurdle before it can legally move into full-rate production follows numerous recent reports, including by POGO as well as the Government Accountability Office, indicating the most expensive weapon system in history is far from ready to face current or future threats. The 23 aircraft in the test fleet achieved an abysmal “fully mission capable” rate of 8.7 percent in June 2019 according to the chart, which covers December 2018 through mid-July 2019. A fully mission capable aircraft can perform all of its assigned missions, a particularly important readiness measure for multi-mission programs such as the F-35. The June rate was actually an improvement over the previous month, when the fleet managed a rate of just 4.7 percent. Since the beginning of operational testing in December 2018, the fleet has had an average fully mission capable rate of just 11 percent.

The Pentagon’s operational testing director has stated that the test fleet needs an 80 percent availability rate to meet the demanding schedule of the program’s test and evaluation master plan.

The money quote is, “Newer aircraft like the F-22 and F-35 are averaging lower mission capable rates than the legacy aircraft they are slated to replace.”

Our military industrial complex is increasingly dysfunctional, and I fear that it is only a matter of time before it collapses under its own prodigious weight.

Not a Surprise

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Former Google staffer Kevin Cernekee, whose firing has been held up as a victim of Silicon Valley’s liberal bias, is actually a supporter of Richard Spencer and other white supremacists.

So, this guy is not just a conservative, or even a contrarian, he’s a white supremacist, and a supporter of racist violence, which is pretty much a textbook definition of a clear and present danger in the workplace:

When we recently wrote about the myth of anti-conservative bias at the various internet platforms, we got a lot of angry responses from people who insist (very loudly, often with lots of insults and anger, but rarely with any facts or data) that we’re full of shit. We’d be open to believing it if there was any actual support for these claims. But none is ever forthcoming. Indeed, amusingly, some people pointed out that a recent WSJ article about an alleged fired “conservative” engineer at Google, described as a “whistleblower,” was more “proof” that the company has it in for conservatives. Tucker Carlson even had the engineer, Kevin Cernekee, on his show last week to continue to feed the narrative.

………

However, as we’ve pointed out concerning most of the “conservatives” who have had content removed or been banned from social media platforms (as is true in similar situations with liberals and other non-conservatives) there is almost always more to the story — and that “more” is often that these people are not banned or fired or otherwise held back because of their general political views, but because of something much worse. And, in the case of Cernekee, people finally realized that maybe it wasn’t that he was a conservative, but that he wanted to fundraise in support of one of the US’s most well known white supremacists, Richard Spencer.

………

But, yeah, the guy who Trump is holding up as proof that there’s anti-conservative bias at Google is maybe not the best messenger if you’re trying to convince the world that “conservatism” is not the same thing as “white nationalism.” Oh, and it gets worse. The Daily Caller article shows that, despite Cernekee claiming in the WSJ that he was a “mainstream Republican” who “disagrees” with white supremacy, within an internal Google listserve, Cernekee suggested that racist skinheads consider rebranding:

………

Meanwhile, another “conservative” engineer who was also fired from Google, Mike Wacker, has written a barnstormer of a blog post detailing the fairly typical trollish behavior by Cernekee. It’s pretty damning:

So not surprised.

This story always had a hinky smell to it.

Talibaptist

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Seriously, these people are indistinguishable from ISIS:

A week before his re-election last year, state Rep. Matt Shea denied that a leaked manifesto he wrote was a road map for a holy war, one that would pit conservative Christian “patriots” against Muslim and Marxist “terrorists.”

Rather, Shea insisted, the document titled “Biblical Basis for War” contained notes for a scholarly sermon on war in the Old Testament.

But newly leaked emails, first reported by The Guardian on Wednesday, as well as a video on Shea’s public Facebook page, show the Spokane Valley Republican has had close ties with a group called Team Rugged that trained children, teens and men in their early 20s for religious combat.

“The entire purpose behind Team Rugged is to provide patriotic and biblical training on war for young men,” a man identified as the group’s leader, Patrick Caughran, wrote in a July 2016 email to Shea. “Everything about it is both politically incorrect and what would be considered shocking truth to most modern christians. There will be scenarios where every participant will have to fight against one of the most barbaric enemies that are invading our country, Muslims terrorists.”

Props to the Spokane county sheriff though:

Spokane County Sheriff Ozzie Knezovich, who has urged fellow Republicans to denounce Shea as an extremist, compared Team Rugged to the Hitler Youth of Nazi Germany.

“Any radicalization of youth in such a manner would be very comparable,” Knezovich said in a text message Wednesday.

I did Nazi that coming.

H/t EC at the Stellar Parthenon BBS.

The Real Question

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Who Protected Epstein for Decades, and Why?

There is significant evidence that elements of the US state security apparatus may have protected Jeffrey Epstein, and his extensive sexual abuse of children, because he was an intelligence gathering asset, either as an informant, or as a “Honey Pot”.

Even if this is not true, it is clear that SOMEONE OR SOMETHING was protecting him, and it behooves us to find out who and what.

Wells Fargo Needs to be Seized as a Criminal Enterprise

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Xavier Einaudi did not want to wait for Wells Fargo to send him a check.

The bank informed Mr. Einaudi that it was closing all 13 of the checking accounts it provided his roofing company, CRV Construction, for a reason it called “confidential.” The letter said the accounts would be closed on June 27, and he would be mailed a check for the balance in his accounts.

Mr. Einaudi went to his branch and collected the money, so he did not have to wait for a check to arrive in the mail. But the accounts did not close on the preset date.

For weeks after the date the bank said the accounts would be closed, it kept some of them active. Payments to his insurer, to Google for online advertising and to a provider of project management software were paid out of the empty accounts in July. Each time, the bank charged Mr. Einaudi a $35 overdraft fee.

Mr. Einaudi called the bank’s customer service line. He went to his local branch. Nobody could help him. “They told me, ‘The accounts are closed out — we cannot do anything,’” he said.

By the middle of July, he owed the bank nearly $1,500.

“I don’t even know what happened,” he said.

Current and former bank employees said Mr. Einaudi got charged because of the way Wells Fargo’s computer system handles closed accounts: An account the customer believes to be closed can stay open if it has a balance, even one below zero. And each time a transaction is processed for an overdrawn account, Wells Fargo tacks on a fee.

This is intentional, not an accident by IT.

Wells Fargo is rotten from top to bottom, and regulators should burn it to the ground.

Think of the Innocent Venture Capitalists!

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How dare a city set minimum standards for pay and disabled accessibility, as well as charging the companies for the congestion that they cause.

I’ve said it before, but it bears repeating:  Most of the so-called “Disruptive Innovation” out there is either regulatory and legal arbitrage (breaking the law), or monetizing the commons (Making the rest of use pay for their business model):

Uber CEO Dara Khosrowshahi, who took the helm of the controversial company back in 2017, is known for being pretty unflappable. He was even upbeat during the company’s second quarter earnings call, when he was charged with explaining why Uber posted more than $5 billion in losses in just a few months’ time.

………

The new wave of rule-passing started last summer, when the city instituted the country’s first-ever freeze on for-hire vehicle licenses, barring drivers from registering new cars to drive for the companies. (The freeze exempts wheelchair-accessible and electric vehicles.) In January, Uber and Lyft trips beginning or ending in much of Manhattan got slapped with an extra $2.75 congestion charge. (Taxis got a $2.50 surcharge of their own.) Then, despite a lawsuit from Lyft (and a smaller competitor named Juno), the companies were forced to begin paying drivers $17.22 per hour earlier this year. And a new state law will force the companies to rejigger their fleets to accommodate wheelchair using-passengers more quickly. Phew.

Now, new rules approved by city regulators this month extend the freeze on new Uber and Lyft vehicle licenses in New York indefinitely. (This spring, a judge blocked an Uber lawsuit aimed at stopping it). The rules also cut down on “cruising,” or the time drivers spend waiting for their next rides or driving to their customers, forcing the companies to again rethink how they’re dispatching drivers.

………

The city has symbolic importance, too. Though most other cities don’t have the authority to regulate ride-hail in the way that New York does, many, also sick of traffic, are looking for ways to do so. Some hope to levy fees on the companies, like the kind collected in Chicago, Washington, DC, and, if San Franciscoans decide to pass an upcoming ballot measure, the City by the Bay. Others are attracted to the hard stick of New York’s ride-hail vehicle cap. In the run up to her election, Chicago’s new mayor told a newspaper that she would favor new limits on the number of ride-hail vehicles in the city. (The city’s consumer protection office, which is in charge of regulating ride-hail, did not respond to WIRED’s request for comment.)

………

The ride-hail companies have responded to the rules, which they say have been instituted too quickly for anyone to understand their effect, with cat-and-mouse tactics aimed at keeping riders in cars and revenues in pocket. The companies have, for example, raised prices across the city, a move that Uber says has led to stunted ride growth in some low-income neighborhoods.

The ride-hail companies are also changing the way their apps work for New York City drivers, many of whom work full-time because of the city’s more stringent licensing policies. Now, in times of low demand, Lyft limits the number of drivers on the road, giving priority to high-volume drivers who have accepted and completed 90% of their rides, or those who have wheelchair-accessible cars, or those participate in the company’s Express Drive program, which rents vehicles to licensed drivers who don’t own cars. The driver app also now includes a “heat map” showing where rides are in the highest demand, and Lyft has urged drivers searching for rides to go there before turning on their app—urging them, essentially, to drive to where the app needs them without being paid for it, and without Lyft being penalized by both the new driver wage and new cruising rules. Uber sent an email to drivers earlier this month indicating it is also mulling changes to its driver app.

Rather ironically, the effects of unregulated Gypsy cabs like Uber and Lyft, low wages, unsafe vehicles, and congestion, are the very same reason why the medallion system was implemented in many cities in the first place.

Snark of the Day

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WeWork Officially Files To Be The Last IPO

This S-1 filing is a word quilt made up of every bad idea from every IPO of the past five years.

—Dealbreaker

I am used to IPOs for companies that have no path to profitability, but WeWork’s IPO documents admits that its CEO is literally looting the company.

This is a level of bald faced fraud that is extraordinary even by the standards of Silicon Valley.

Kochs Gave Seed Funding to the DLC as Well

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It turns out that Third Way, the corporatist faux Democrats, are being bankrolled by the Koch brothers.

This is not a surprise.

Their political activities are not about political parties, they are about supporting their own self-interest and their own libertarian ideology:

In the fall of 2007, the tide was beginning to turn against free trade, as the ongoing hollowing out of the American middle class was becoming associated with globalization and the offshoring of jobs. Its leading public opponent was the bombastic CNN anchor Lou Dobbs, a proto-Trump whose economic nationalism curdled easily into racism and nativism. Many Democrats, too, were turning sour on free trade. Then-President George W. Bush relied on Republican votes to ram through the Central American Free Trade Agreement in 2005, but future deals were looking far from certain, particularly after Democrats seized control of Congress in the 2006 midterms.

This was a direct threat to Koch Industries, the sprawling business empire long led by billionaire brothers Charles and David Koch. The fossil-fuel giant’s business has long been based on importing oil from Canadian tar sands, which it refines at its massive Pine Bend plant in Minnesota — and the opposition to free trade threatened to make that business much more costly. The Kochs desperately needed help with Democrats, so they turned to a reliable partner: Third Way.

According to the new book “Kochland,” written by investigative reporter Christopher Leonard, Koch Industries secretly financed a report by Third Way, a corporate-funded think tank with ties to the centrist wing of the Democratic Party. The report, titled “Why Lou Dobbs is Winning” and published in November 2007, was written to promote the free trade agenda to liberals. The white paper explained it would be the first salvo in a yearlong effort to reshape the messaging around trade policy, warning that “a new and powerful populist strain has emerged on both the left and the right of American politics that threatens to turn the nation fearful and inward.”

Third Way did not respond to a request for comment.

………

It may seem odd to see the Koch brothers, who operate today as partisan Republicans, aligning with business-friendly Democrats, but the strategy dates back further. (After publication, Nicholas Gass, a Koch spokesperson, noted that David Koch has stepped away from advocacy and that the Koch strategy is less partisan in its focus than previously.)

A 2001 American Prospect investigation noted that Koch Industries was a member of the executive council of the Democratic Leadership Council, founded in 1985 by centrist Democrats to combat the left inside the party. Hall, thanked in the report, was a member of the DLC’s event committee at the time.

This is the least surprising news that I’ve heard in a long time.

There is a Briar Patch Metaphor Here

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The US ambassador to Germany, Richard Grenell, us threatening to move US troop installations to Poland if Berlin does not increase defense spending.

So, the US is saying that Germany would not have to deal with the noise from the jets, the tanks blocking streets when they deploy for war-games, and the other issues that arise from large deployments of foreign troops on their soil, because they would be just on the other side of the border and just as available for their defense needs.

I do not claim to be an expert on the German zeitgeist, but you have to be pretty dense not to get this:

An envoy of U.S. President Donald Trump suggested on Friday that Chancellor Angela Merkel’s unwillingness to boost defense spending might give the United States no choice but to move American troops stationed in Germany to Poland.

The comments by Richard Grenell, the U.S. ambassador to Germany, signal Trump’s impatience with Merkel’s failure to raise defense spending to 2% of economic output as mandated by the NATO military alliance.

“It is offensive to assume that the U.S. taxpayers continue to pay for more than 50,000 Americans in Germany but the Germans get to spend their [budget] surplus on domestic programs,” Grenell told the dpa news agency.

Germany’s fiscal plans foresee the defense budget of NATO’s second-largest member rising to 1.37% of output next year before falling to 1.24% in 2023.

Eastern European countries like Poland and Latvia, fearful of Russia after it annexed Crimea from Ukraine in 2014, have raised their military spending to the 2% target, drawing praise from Trump who wants Germany to do the same.

No nation wants foreign troops on its soil, it’s a price that they are willing to pay for other benefits.

The Trump administration just offered the benefits with none of the costs.

Stephen King is a Portrait of Dorian Gray

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Rep. Steve King (R-Iowa) sparked a new uproar Wednesday after making incendiary comments about rape and incest, with Democrats — including multiple presidential candidates — rushing to condemn the controversial lawmaker.

King made the remarks while speaking to the Westside Conservative Club in Urbandale, Iowa, on Wednesday, where he sought to defend anti-abortion legislation with no rape or incest exceptions. “What if we went back through all the family trees and just pulled out anyone who was a product of rape or incest? Would there be any population of the world left if we did that?” the lawmaker said.

“Considering all the wars and all the rapes and pillages that happened throughout all these different nations, I know that I can’t say that I was not a part of a product of that,” he added.

House GOP Conference Chairwoman Liz Cheney (Wyo.) tore into the Iowa Republican, suggesting his past and recent remarks made him unfit for Congress.

“As I’ve said before, it’s time for him to go. The people of Iowa’s 4th congressional district deserve better,” Cheney said.

Republicans are not outraged because the statement is outrageous, they are terrified that King’s comments reveal their true inner selves.

Stephen King is the mirror that they cannot bear to see.

It Appears that the Very Serious People in Britain Think that Corbyn is Worse than a Hard Brexit

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I have been rather confused by how the anti-Brexit, and anti-hard Brexit actors have been behaving in what can only be described in a self-destructive manner.

Well, recent developments show that they believe that Jeremy Corbyn being Prime Minister is worse than a Brexit crash-out.

Considering the scenarios that they have described for a no-deal exit from the EU, a complete shut down of exports, food shortages, and an economic implosion, their phobia of the left-wing Labour leader is nuts:

Brexiters stop at nothing to get what they want and remainers stop at everything. The laws of political motion then dictate which direction things move.

Jeremy Corbyn has written to MPs inviting them to install him in Downing Street, having deposed Boris Johnson with a vote of no confidence. His tenure would, he promises, be “strictly time-limited” – long enough to call a general election and seek the necessary article 50 extension to conduct a ballot.

For Corbyn this is the simplest route out of the current mess. There is a government hell-bent on doing something that a majority of MPs oppose and believe to be ruinous – hurtling off a Brexit cliff-edge. The Fixed-term Parliaments Act gives the Commons 14 days to organise a replacement when an incumbent government is defeated in a no-confidence vote. Who else is going to lead that administration if not the leader of Her Majesty’s opposition? In constitutional terms he is the obvious candidate; probably the only candidate.

But in the minds of scores of MPs he is not. His past equivocations over Europe are not the reason, or at least not the only reason. Pro-European Tory rebels, Liberal Democrats, the rag-tag platoon of independents and semi-autonomous tribes of Labour MPs have spent months fretting about ways to thwart a hard Brexit, apparently ready to pull every procedural lever and contemplate all manner of unorthodox coalitions. Not much has been excluded from those considerations, except for a tacit prohibition on any route that makes a prime minister of the current Labour leader. Their horror of Corbyn is equal to – or greater than – their horror of Brexit. That has been so well understood by the participants in the discussion that few have felt much need to articulate it. Corbyn’s letter now obliges them to spell it out.

That is easier for some than others. Tories and ex-Labour independents don’t have much difficulty vocalising reasons why they think the Labour leader is unfit for office, even on a time-limited basis. They see him as a political extremist, a friend of terrorists, Putin stooges and antisemites. They think he would bring to Downing Street a sinister creed and a cabal of advisers whose very presence inside No 10 would sabotage the safety of the UK. For MPs who feel that way, the objection to a single day of Corbyn rule, even for a tactical purpose, is visceral and moral.

But there are others – Greens, Lib Dems and Labour moderates – who, if they share that passionate aversion, are reluctant to express it in public. Jo Swinson comes close. When elected to lead the Lib Dems she ruled out an alliance with Corbyn on the grounds that he couldn’t be trusted on the European question, but also (added almost as an afterthought) because “he is dangerous for our national security and for our economic security, too”.

………

There is something disingenuous about the discussions among MPs about a “government of national unity”(GNU) to avert a no-deal Brexit. It is predicated on concepts of nation and unity that don’t include those who are desperate to leave the EU. Those who voted leave are broadly satisfied with the government they currently have. It is, in truth, a euphemism for a model of technocratic, centre-facing liberal administration defined as much by a rejection of Corbynism as by revulsion at the Trumpian nationalist character that Brexit has acquired. There are many voters who would be glad to have a moderate, bipartisan government. They can play fantasy football with exotic cabinet combinations – Dominic Grieve as chancellor; Keir Starmer to fix Brexit; Caroline Lucas for the environment; Jo Swinson for home secretary. And the prime minister? David Lidington? Yvette Cooper? Anyone as long as it isn’t a Johnson … or a Corbyn. But the Commons numbers don’t add up for that either, unless most of the parliamentary Labour party abandons the whip. It won’t.

The Labour leader knows this and he is calling the whole GNU bluff. If a government falls, the opposition leader is the next in line to have a go and, if that can’t be arranged, there is an election. That is how it works. There might be many reasons why MPs do not want an opposition leader to take charge – that is their constitutional right, too – reasons of tactical political advantage and reasons of conscience. But MPs have not all been candid about what those reasons are; why it is that so many find Corbyn as toxic as Brexit. Their problem is that there aren’t a lot of other options. And the laws of political motion are working against them.

This level of antipathy is not driven by a fear that Corbyn will fail, it is being driven by a fear that he might succeed.

It’s OK that Iceland jailed the bankers and protected its citizens, because there are fewer than ½ a million people on that island.

If that happens in the UK, and more importantly to the financial center known as the City of London, then their patrons, and their comfortable lifestyles, are a thing of the past.

Bye Felicia

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John Hickenlooper, corporate tool and friend of the fracking industgry, is suspending his Presidential campaign.

Still, he thinks that there is a place for him in politics, standing athwart progress saying, “Better things aren’t possible.”

John Hickenlooper, the former Colorado governor whose low-key brand of moderate politics made him popular in his home state but limited his appeal in a Democratic primary filled with urgent progressive energy, announced on Thursday that he was ending his presidential campaign.

Mr. Hickenlooper has been seriously considering a run for the Republican-held Senate seat in Colorado that is up for election in 2020 — a key pickup target in the Democrats’ strategy to try to retake control of the Senate.

“Today, I’m ending my campaign for president,” he said in a videotaped statement. “But I will never stop believing that America can only move forward when we work together.”

“I’ve heard from so many Coloradans who want me to run for the United States Senate,” he added. “They remind me how much is at stake for our country. And our state. I intend to give that some serious thought.”

Dude, go back to your f%$#ing brew pub.

We Are in Another Game of Musical Chairs

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There is significant evidence that it is Wall Street speculation that is driving the recent home price increases.

This means two things:

  • The home affordability crisis is driven by speculation, and not from inherent value.
  • There is a crash coming, and you do not want to be left holding the bag when this happens, because eventually, they WILL run out of useful idiots.

We’re in another Tulip craze.

In a recent column, I focused on five key factors which indicate that housing markets may be topping out. Yet one other important factor may be the main reason why housing prices have not already deflated.

Investors have always played an important role in housing markets. I have written extensively about the crazy bubble years of 2004-06. Rampant speculation was one of the primary causes of the buying mania and subsequent collapse. A May 2005 Fortune magazine article described how speculators were descending on city after city in search of making a killing in real estate.

The chart below, from a 2011 study put out by the Federal Reserve Bank of New York, shows the percentage of homes purchased with a mortgage by investors in states where the bubble was most excessive. This chart breaks down investor mortgage borrowing by the number of first liens appearing on the credit report of these investors. Notice the substantial number of investors with three or more first liens:



The chart shows that in the bubble states, more than 40% of all new mortgage originations for purchases went to investors/speculators during the wildest years of 2006 and 2007. Another chart in this same study showed that nationwide, roughly 30% of all originations were for investors. If we include all-cash investor purchases, the percentage of homes purchased by speculators was even higher.

When home prices leveled off in the second half of 2006, nervous speculators in the hottest major metros began to sell in large numbers. This precipitated the price collapse which soon followed. By 2009, the foreclosure debacle was in full swing. For the next four years, investors focused on buying inexpensive repossessed properties. Most of these foreclosure sales were all-cash deals.

Contrary to a widely-held assumption, many of these investor-purchased homes were not bought by flippers. They were turned into rental units for a new type of renter — former homeowners whose house had been foreclosed.

………

Unlike the speculative housing bubble of 2004-07, the investment surge over the past six years has been largely driven by a purchase-and-rent strategy. This made a lot of sense. Rents have risen steadily as most home prices continued to climb. A report from CoreLogic stated that rents grew nationwide by an average of 3.2% in January 2019 from a year earlier. Another benefit was that the tenant retention rate of 70% was much higher than the 50%-53% retention rate for multi-family apartments, according to a recent Freddie Mac report.

………

Is there credible evidence that investor purchases of single-family homes have increased in recent years? Absolutely. Attom Data has provided previously unpublished data breaking down home purchases by owner-occupants and absentee owners, i.e., investors:



You can see in the table above that the percentage of homes purchased by absentee owners rises consistently from 2016 through the first half of 2019. According to these numbers, more than one-third of all home purchases in 2019 have been made by investors. Yet even with this increase in investor purchasing, the volume of home purchases in most major metros has been declining. That is a major red flag.

Indeed, had it not been for the aggressive buying by investors in the past two-and-a-half years, home prices would have already slumped in these metros. If you do not find this suggestion plausible, remember that it was the pullback by speculators/investors in 2006 and their dumping properties onto the market that started the housing collapse.

Look out below.

Adventures in Metrology

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Over at Wet Machine, Harold Feld has given us  a new measurement for irony, the Morissette.

He was discussing the rumors that Trump is attempting to institute censorship of social media through FCC regulation, which is both legally and constitutionally impossible:

Granted, humiliating yourself at Trump’s command by publicly utterly reversing yourself on everything you previously said you believed in is almost a rite of passage for officials in the Trump Administration. But if Trump actually did do this, it would be a true work of Total Humiliation for Pai & friends. This is why I give even the rumor of this a rare 5 out of 5 Morissettes on the Irony Scale (named after singer Alanis Morissette and her famous ironic song “Irony” about things that aren’t actually ironic.)

(Emphasis Mine)

At this point, I am unclear if this is a linear or a logarithmic scale, but my money is on the latter.