#capitalism

Banks & Insurers lecture customers on morals

Baseball legend Curt Schilling has claimed that insurance company, AIG, has cancelled his policy over tweets he made about the recent events on the Capitol.

Schilling stated he had a AAA rating and no claims for 17 years.

Aren’t insurance companies supposed to assess risk? Did Schilling have a major endorsement contract with AIG? If so, we’d understand. If not, isn’t he an anonymous customer among millions?

What relevance does an insurance policy have to do with a customer expressing first amendment rights? Has AIG gone through the Twitter accounts of all of its policy holders to check they have not said anything similar to Schilling? If not, would be highly discriminatory, no? Should he sue?

Wasn’t AIG found guilty of entering into sham transactions in order to inflate the reserves and to conceal losses in 2005? Didn’t Schilling, a taxpayer, indirectly bail out AIG post the GFC?

Deutsche Bank has also moved to end its association with Donald Trump. Ironic, that a bank which has been fined repeatedly for unethical behavior such as money laundering thinks it has an opportunity to save its skin by signaling it has repented. Will a flood of customers open accounts as a sign of appreciation? Probably not.

Fascinating that – bank worth 8% of its peak value, is lecturing customers about morals when it has a self-documented history of being a bank for the Third Reich, including the provision of funds to build the Auschwitz extermination camp.

Since when did corporates self-appoint themselves as moral arbiters of their customers individual constitutionally enshrined liberties? Will customer social media profiles now form part of the loan application documents? “Sorry sir, your credit rating is outstanding but the application has been rejected for something you posted when 13 years old.” Got it?

More corporate cowardice masquerading as courage. This is nothing more than companies showing they are going out of their way to make public sacrifices on the altar of the Marxist fringe mobs in the hope they become the last to be cancelled. What a joke.

We never thought it imaginable but today, corporate PR departments have less spine than internal compliance officers.

Should the Coons be Cheesed Off?

More gutless corporate pandering to the mob. We wrote about the plan to change the brand name of ‘Coon‘ cheese last year.

The cheese was named after its American maker, Edward William Coon, 85 years ago.

It has now been changed to ‘Cheer.’

In our view, the marketers should be fired for a lack of creativity. About as useless as the PR team of parent company Saputo.

Why didn’t Saputo write about the origins of Coon on the packet? Seems sensible to educate those woke fringe groups who take umbrage at everything.

Instead, the Saputo CEO gave the all too common cave in to the cancel culture by stating,

Treating people with respect and without discrimination is one of our basic principles and is is imperative that we continue to uphold this in everything we do.”

Hasn’t the food producer disrespected the 31 families bearing that surname in Australia?

Should the Coons be pressured to change their surname to Cheer? What better way to accumulate woke points with the apparatchiks than getting the Coons to renounce their origins. Why not hold a ceremony named Day 1, Year 0 where the families publicly apologize for unconscious racism and beg for forgiveness.

Perhaps Saputo can pay for all the legal costs associated with changing drivers licenses, passports, Medicare and all other manner of documentation so the dairy company can revel in even more vacuous virtue signaling so the PR department can justify having a role.

Down the line, we would love to see the empirical data on how the lives of those the name change is designed to improve have been bettered. Apart from absolutely zero, we imagine the only declining figure experienced will be the revenue line.

Another corporate own goal.

Perhaps Saputo should look at those brands who have stood up to the faux outrage groups – GoyaRed Bull – and won.

Three Cheers for the cowards.

Whites need not apply?

Yet more of the Biden agenda to unite all of America. Instead of helping all those who run small businesses based on the level of individual economic hardship, race and gender will be the new determinants.

So in short, if you’re an a relatively unaffected minority run-business you will be favored for support over an on death’s door multi-generational white business.

Which boxes will ensure the maximum subsidies? Is it best to be an illegal immigrant who is also a coloured LGBT woman of Islamic faith with a disability?

Welcome to the world of identity policy. Imagine if the Democrats hadn’t so feverishly supported the BLM riots which ended up destroying so many minority owned businesses that such a policy wasn’t required to be drafted in the way that it has.

Liberal logic. Stop systemic/institutional racism by setting up structures that guarantee it thrives.

How do you like dem Apples?

How is it that Twitter has survived for so long allowing violence, vitriol and hatred on its platform yet Apple and Google chose to do zip about it? We know the answer.

However, when a conservative alternative is deemed to have ‘broken’ the rules, Apple comes down like a tonne of bricks. The rank hypocrisy.

Apple has never suspended Twitter from the App Store when hateful and violent bile has been and continues to be spread.

Kathy Griffin retweeted the image of a bloody decapitated head of President Trump (the one that she was desperately sorry for in 2017) the day after the election result was called by the media. Almost 10,000 retweets, 64,000 likes and a laundry list of hateful replies. Is this not violence?

Or a more recent tweet from Griffin,

Look, you stupid bitch, go throw your dad that BJ he wants and then walk him out of the White House and the Presidency forever. Force him to resign immediately. twitter.com/ivankatrump/st…

Of course some will argue she is a comedian (a terrible one at that) and therefore deserves a pass on distasteful content as it is an art form.

Still, doesn’t suggesting that Ivanka perform fellatio on her father violate community standards? If anyone (including a comedian) suggested one of Obama’s daughters perform oral sex on her father, Twitter would censor it (appropriately) and the mainstream media would run with it for days lambasting this despicable behaviour and go out of their way to cancel the offender.

John Henson, host of Food Nation, tweeted, then deleted,

“I hope Barron gets to spend today with whoever his dad is.”

Is slut-shaming FLOTUS fair game? Is making fun of a minor appropriate? Even if people delete tasteless tweets, why isn’t Apple demanding that Twitter take stronger action and threaten to suspend it from the App Store until it has dealt with people who violate community standards?

What we find particularly sinister is the way Big Tech is flexing its muscles and bullying companies they have ideological differences with conform to their moral code. Maybe Apple should demand a seat on the board of Parler to approve its decision? It would be one thing if Apple put Twitter in the penalty box as well but alas, corporate double standards are a thing. It is not the principle that matters, but the side.

Why doesn’t Apple suspend Tinder from its App Store until it deals with the countless cases of sexual assault? In a survey conducted in Australia, 48 out of 400 Tinder users claimed they were a victim of sexual assault. Of that, 11 claimed they had a formal response from the company.

Isn’t Apple big on supporting #MeToo? It has an entire series, The Morning Show which deals with sexual misconduct in the entertainment industry. So it is happy to make a buck off content that relates to inappropriate sexual behavior but not be prepared to stand up for real victims who get hurt by apps like Tinder where Apple’s very own words to “adequately address these proliferation of these threats to people’s safety” isn’t extended.

Spare us the double standards!

Stop Press: Now Amazon has piled in to dump Parler from its web services.

Welcome to the dystopian nightmare. Black is white. Freedom is slavery. War is peace. Got it?

Sen Josh Hawley pushes back on publisher intimidated by the mob

Good on Senator Hawley pushing back on the publisher that caved to the mob by cancelling his book, ironically about the importance of free speech and the 1st Amendment.

Did the publisher, Simon & Schuster (S&S) have a contractual right to scrap his publication?

Do S&S get to make the legal call on ‘sedition’ as the reason for cancellation? If Hawley isn’t convicted of that crime, they would have no legal basis to make that call.

This is not the same as a Christian baker refusing to make a cake for a gay couple based on their religious beliefs.

S&S have clearly done it to make their intentions known they don’t want to become modern day kulaks in the cancel culture world.

This is a clear call against free speech. We hope that Hawley is successful his plight and a braver publisher picks up the ball and runs with a book that shouldn’t be incendiary.

This is not new.

In Australia, fringe mobs like Sleeping Giants and Mad F*cking Witches pretend to represent the mainstream and have had success intimidating corporates to capitulate despite often breaking secondary boycott rules in the process.

Time for more people to stand up to these corporate cowards. The irony is that the very people pushing cancel culture are the least likely candidates to consume the products they protest. So why do corporates wimp out without a fight?

Media worth consuming – a recap of December 2020

My good mate Jonathan Rochford of Narrow Road Capital has compiled a brilliant summary of the recent madness in markets, politics and economics. One could be forgiven for thinking it is a lot like satire. Link here.

Identifying misinformation without facts

You have to hand it to government funded media networks. Just like Australia’s ABC, America’s NPR will peddle its belief system and tell you what is misinformation and what is not.

Here are some of the responses to an NPR poll listed under “incorrect statements”:

“Humans do not play a significant role in climate change

It scored a 69% false rating. Does NPR have facts to support that misinformation?

Have they read the amount of climb downs made by the UN IPCC with respect to have very low confidence that extreme climate events are in any way linked to global warming? Obviously not. The 2018 study compiled by the IPCC just reinforced the findings of the 2013 paper by an even greater degree.

Or the hilarious article in a climate alarmist newspaper that pointed to putting faith in the very investment bankers who they wanted burnt at the stake in 2008. As long as they sing the correct tune in their endeavors of crony capitalism.

Or perhaps the EU Parliament commitment to a climate emergency bill which voted on the following proposed amendment 95 (for), 563 (against), 9 (abstain) by MEPs:

Recalls that climate change is one of the many challenges facing humanity and that
all states and stakeholders worldwide must do their utmost to measure it
scientifically so that policy, and especially spending, is based on observable facts and not on apocalyptic fearmongering or unreliable models; emphasises that there is no scientific consensus on what percentage of climate change is anthropogenic and
what percentage is natural

Wouldn’t want pesky facts to get in the way of doubling commitments to the green climate fund. Openly vote to show evidence is irrelevant.

Of the 1,115 people polled to give a true/false answer on the statement “a group of Satan-worshipping elites who run a child sex ring are trying to control our politics and media” it returned a false rating of 47%.

Perhaps the 53% that returned a true/unsure vote merely thought elements of the statement were true. After all it wouldn’t be a stretch to suggest that elites are trying to control politics and media in a coronavirus lockdown world. Just look at the politicians breaking the very rules we must abide by. If we step out of our homes we risk instant infection from a disease with a 99.9% recovery rate.

With an ever complicit social and mainstream media peddling fear and checking their own facts by shutting down alternative viewpoints (aka free speech), what is so hard to fathom?

Still getting woke and going broke

The North Face corporate virtue signal reminded us of the catastrophic destruction of value ($8bn) that befell Gillette.

What an opportunity for another similar brand to fill the void and capitalize on reality with sensible counter campaigns such as this watch company.

Once again, it is always embarrassing when corporates pontificate on subjects they know little or nothing about apart from what their woke PR teams tell them makes for good global citizens.

Surely customers don’t need sanctimonious lectures from corporates who invariably have chequered histories themselves.

Perhaps the regulators should clamp down on corporate hypocrisy instead of their empty commitment to usher climate change abatement reporting. Never forget that the stats show fewer companies are actually reporting on climate change for all the fluffy videos playing in corporate lobbies.

Watch the hips not the lips.

If we believed the science 50 years ago

50 years ago we were told to prepare for an ice age. Now we’re told to prepare for rising global temps. Believe the science or the activists?

We always like to refer people to the UN’s own survey on itself as to the (lack of) robustness in the scientific process in the very climate bibles we are told are the gold standard. Note, the contributing scientists’ words. Not ours.

Whatever side of the coin you maybe as goes climate change, one can’t deny this is incredibly damning and highlights that it is almost exclusively about politics and wealth redistribution than saving Johnny polar bear.

That hasn’t stopped climate alarmists rejoicing the prospect of Biden rejoining the cabal of capital misallocation. One wonders whether the climate apparatchiks will carry out their promise to jail climate skeptics.

And isn’t it funny the mainstream media celebrates China’s commitment to be carbon neutral by 2060? Not sure if many of will be around to find out. Maybe that’s the point. At least by then Greta Thunberg will be in her 50s. We hope not traumatized knowing that she was totally hoodwinked.

How to sum it up? The climate change industry wants us to believe that highway service station diners are worthy of Michelin stars. Thank God we may have John Kerry telling soccer mums to refrain from taking the kids to soccer practice in a second hand SUV as he pontificates from one of his six houses.

Watch the hips, not the lips.

Too much cash can create a crisis

A very important piece from our learned friend at Narrow Road Capital, Jonathan Rochford.

“The current conditions in credit markets are bizarre. We’re still in the midst of a global pandemic and economic downturn but credit markets are partying like there’s no tomorrow. Almost every day credit spreads go lower as anecdotes emerge of banks refusing to take term deposits from new clients. The banking system is flooded with liquidity and there’s simply not enough demand to borrow to match the freshly printed central bank cash.

The last time I remember such excessive liquidity was in early 2007. Back then I was managing a cash fund and I remember being rebuffed by several major banks when we called and asked for their rate for our short term cash. When we couldn’t find a home with them we turned to the commercial paper market and found some boring vehicles that would take our cash for a handful of basis points over the bank bill rate. We didn’t get involved with the racier structured investment vehicles (SIVs) that offered a little more yield, with several of those blowing up as the financial crisis kicked off in 2007.

In a credit spread sense it’s not as bad today as it was then with 5 year major bank senior bonds paying around 35 basis points over BBSW today compared to 10-12 basis points then. However, on an all-in (credit spread plus risk free yield) basis it is far worse today as the cash rate in 2007 was over 6%, which was miles above the inflation rate. Today, there’s very little global debt with an investment grade credit rating that offers a positive real (after inflation) return. Whilst it is easy to look back and be critical of those chasing additional yield then, it is harder to criticise the same behaviour today when central banks are deliberately punishing conservative investors with negative real returns.

The inevitable outcome of this excessive liquidity is stupid lending is happening on an ever increasing basis. Despite a large swathe of companies on the brink of default, the US high yield market has never had worse covenants and never had lower all-in yields. Several African countries have defaulted or are on the brink of default but others are easily selling new bonds. Italy and Greece have virtually no prospect of ever paying off their debts but their 10 year bond yields are barely 1% more than Germany. Today’s growing pile of dead wood debt risks becoming tomorrow’s bonfire.

All of this is happening because central banks and politicians are too afraid to tell the truth. An economy built on ever increasing levels of debt isn’t sustainable. Trying to prevent investors from taking losses only causes them to take greater risks which leads to larger losses in the long run. We’ve made a long series of bad decisions to get here and there isn’t a painless way out. The glut of cash isn’t a sign of good health, rather it indicates financial markets are delirious with stimulus and won’t stop partying until there’s a crash so big that central banks can’t affect a bail out.