Newsletter 10-8-2021

Hi everyone. Thanks for subscribing. If you have the means, please consider becoming a paying member. If you have the inclination, please pass this newsletter around to others who might enjoy the read. Now onto this week's edition of No Craic, Mad Craic, and Great Craic.

No Craic

(1) We've got some evidence, if circumstantial, of insider trading at the Federal Reserve. Per Craig Torres' reporting, Federal Reserve Vice Chair Richard Clarida "traded between $1 million and $5 million out of a bond fund into stock funds one day before Chair Jerome Powell issued a statement flagging possible policy action as the pandemic worsened."

The market for US treasuries, of course, tanked to a degree never before seen after Powell's comments, consequence of investors rapidly selling everything they held for greenbacks. It was only after the Fed later undertook wholly unprecedented actions that liquidity was eventually restored to the bond market and prices recovered to some degree, as Adam Tooze covers deftly here.

Clarida claims the transactions in question "represent a pre-planned rebalancing to his accounts." Such serendipity defies credulity, to say the very least.

(2) When you think of tax havens, places like Panama, Hong Kong and the British Virgin Islands probably come to mind. The Pandora Papers recently released by the International Consortium of Investigative Journalists, however, reveal humble South Dakota to be the top locale for those looking to hide and keep money. Testament of this, roughly $367 billion worth of assets are currently parked in the state's friendly confines.

South Dakota's value add to scurvy types near and far lies in its trust, asset protection, privacy and tax statutes. Together, this regulatory regime functions to cocoon rich folk from the prying eyes of home governments (and even former spouses), exempt them from meaningful tax payments, and facilitate wealth preservation during the inheritance process.

Add this shite to South Dakota's role in facilitating the usurious practices of credit card companies and it is difficult to disagree with Timothy Noah, who persuasively contends that the state is a moral sewer that ought be abolished.  

(3) Mahmoud Elsobky added this week to some of the excellent work already in circulation regarding Egypt's state-led capitalism.

In his publication for Daraj, Elsokby details how amendments to public procurement laws (the old Tender and Bids Law in particular) allowed firms controlled by either the Armed Forces, General Intelligence Directorate or recent retirees of those institutions to become the largest government contractors in the country. Primary beneficiaries of Sisi's megalomania and fetishes for the grandiose, these parties have accumulated billions in revenues from everything from the building of a new administrative capital to the National Project for the Development of Egyptian Villages to the enormous Suez Canal Area Development Project.

Contraposing the riches earned through opaque, direct and non-competitive bidding processes against the privation contemporaneously inflicted through hikes to the value-added tax and subsidies reforms (with the lifting of bread subsidies next in line) illuminates a great deal about the distributive logic of Sisi's economic nationalism.

(4) An IMF analysis tallied the ledger for the global production and burning of coal, oil, and gas. It found implicit and explicit subsidies totaling $5.9 trillion for 2020. The report can be read in full here.

Mad Craic

(5) Classic wee-man King Abdullah of Jordan, a fella who fancies dressing up in paratroopers' gear and who cannot help but puff out his chest in all photos, used shell companies to secretly purchase 14 luxury homes in the UK and US worth more than $106 million between 2003 and 2017.

Abdullah was assisted in building and hiding this portfolio by a cast of eager international advisors. Will Fitzgibbon of the aforementioned International Consortium of Investigative Journalists draws special attention to the services provided by Victoria Loraine, a British lawyer running a Swiss wealth management company, and her partner, former PwC accountant Andrew Evans.

As monarch, Abdullah is exempt from income or property taxes, so his dealmaking has less to do with skirting the law than with his desire to keep his and his family's decadent lifestyle out of the public eye. Toward the latter end, he shut down much of the internet in anticipation of the ICIJ's reporting.

He'll probably be grand in the end, though Abdullah and co. have really been pushing it with many of their traditional supporters. I wouldn't rule out the possibility of a resurgence of dissent within the ranks of the military at some point in the near future.  

(6) Nemi el-Hassan, a Palestinian-German journalist, was scheduled to start hosting a science show on one of Germany's public broadcasting stations in November of 2021. Then, it was brought to the attention of el-Hassan's prospective employer that she had liked a number of posts issued by Jewish Voices for Peace (JVP) on Instagram in the past. JVP, for those unfamiliar, is an American civil society organization whose mission statement reads as follows:

Jewish Voice for Peace opposes anti-Jewish, anti-Muslim, and anti-Arab bigotry and oppression.  JVP seeks an end to the Israeli occupation of the West Bank, Gaza Strip, and East Jerusalem; security and self-determination for Israelis and Palestinians; a just solution for Palestinian refugees based on principles established in international law; an end to violence against civilians; and peace and justice for all peoples of the Middle East.

More than associate with vile, moralless rogues like JVP, the tireless sleuthing of some right-wing groups in Germany next made public that el-Hassan, as a twenty year-old, had also participated in a march organized by the Iranian government in support of Al-Quds Day in 2014.

In the face of such damning evidence, it proved to be an open and shut case for the public broadcasting station in question in the end: under suspicion el-Hassan harbored anti-semitic values, they had no choice but to retract her job offer.

Michael Sappir at +972 Magazine has the full story here.

What a farce.

Great Craic

(7) Lots of exciting labor news. As Jonah Furman documents, in the past week or so, healthcare workers have been striking in Buffalo just as distillery workers were in Kentucky, classically-trained musicians were in San Antonio, and janitors were in Denver. Grad students at Harvard and Yale and John Deere factory workers in in Iowa, Illinois, and Kansas, meanwhile, look to be prepping the grounds for upcoming actions.

Less promising, Ford announced it is building four new plants for battery and electric car manufacturing in Kentucky and Tennessee. 11,000 are expected to be employed at the plants, though unionization will be an uphill battle in these right-to-work states (Tennessee is attempting to constitutionalize existing right to work laws via referendum next year).

(8) Ben Taub wrote an article for The New Yorker a few weeks ago concerning Khaled al-Halabi, a one-time chief of the Syrian General Intelligence Directorate in Raqqa turned aspiring asylum seeker in France. It is fascinating and 100% worth taking the time to read.

(9) Adam Tooze, mentioned earlier, published a little blog on the inflation debate currently raging amongst economists. For those struggling to know what to believe from the news, his piece serves as a good means for getting your bearings.

(10) Here's a video of a dog and tiger playing in the snow.

Have a great weekend.