Gloomy and Doomy Friday Reads

Viktor Zaretsky, Easter still life, 1989. Ukrainian

Good Morning Sky Dancers!

I’m starting with the two hopeful headlines today since the rest are just depressing. I’m feeling blue and seeing red.  Who isn’t down with putting Orange Caligula in jail? Today, in The Guardian the headline reads “Likelihood of criminal charges against Trump rising, experts say. Some ex-prosecutors call on DoJ to accelerate investigation after House panel’s allegations Trump broke laws to overturn election.”

The likelihood of a criminal investigation and charges against Donald Trump are rising due to allegations by a House panel of a “criminal conspiracy” involving his aggressive drive to overturn the 2020 election results, coupled with a justice department (DoJ) inquiry of a “false electors” scheme Trump loyalists devised to block Joe Biden’s election.

Former federal prosecutors say evidence is mounting of criminal conduct by Trump that may yield charges against the ex- president for obstructing an official proceeding of Congress on 6 January or defrauding the US government, stemming from his weeks-long drive with top allies to thwart Biden’s election by pushing false claims of fraud.

A 2 March court filing by the House January 6 panel implicated Trump in a “criminal conspiracy” to block Congress from certifying Biden’s win, and Trump faces legal threats from justice department investigations under way into a “false electors” ploy, and seditious conspiracy charges filed against Oath Keepers who attacked the Capitol, say department veterans.

The filing by the House panel investigating the 6 January assault on the Capitol by a mob of pro-Trump supporters stated that it has “a good-faith basis for concluding that the president and members of his campaign engaged in a criminal conspiracy to defraud the United States”.

The panel’s hard-hitting findings about Trump’s criminal schemes were contained in a federal court filing involving top Trump lawyer John Eastman, who has fought on attorney client privilege grounds turning over a large cache of documents including emails sought by the committee.

Back in January, the deputy attorney general, Lisa Monaco, also revealed a criminal investigation was being launched into a far reaching scheme in seven states that Biden won which was reportedly overseen by Trump’s ex-lawyer Rudy Giuliani to replace legitimate electors with false ones pledged to Trump.

But the House panel’s blockbuster allegations that Trump broke laws to overturn the election have prompted some ex-prosecutors to call on the justice department to quickly accelerate its investigations to focus on the multiple avenues that Trump used to nullify the election results in tandem with top allies like Giuliani.

“The compelling evidence of criminal activity by Trump revealed by the committee in its recent 61-page court filing should spur DoJ to act expeditiously,” Paul Pelletier, a former acting chief of DoJ’s fraud section, told the Guardian.

“Given the gravity of the revelations, the department should consider a strike force or even a special counsel to coalesce sufficient resources to focus on these criminal attacks that strike at the heart of our democracy,” Pelletier added. “There is no time to waste now that the House committee has provided the clearest view yet into how Trump and his campaign apparently schemed to upend our democracy.”

‘Young guard’ VIKTOR IVANOVICH ZARETSKY

Additionally, NPR is reporting this: “New clues emerge about the money that might have helped fund the Jan. 6 insurrection”.  This is reported by Claudia Grisales.

The latest peek into questions around the money that might have helped fuel the attack arrived with the Republican National Committee suing to thwart a subpoena from the committee.

The filing reveals that the Democratic-led panel quietly subpoenaed an RNC vendor, San Francisco-based Salesforce, last month.

After the suit became public, the committee quickly defended the effort, saying it was looking into a new push led by former President Trump asking for donations after he lost his 2020 bid for re-election.

“Ever since Watergate, one of the central adages in… congressional investigations of presidential wrongdoing has been follow the money,” said Norm Eisen, a former House lawyer in Trump’s first impeachment case. “The 1/6 committee investigation has been sweeping in all of its dimensions, and this is no exception.”

The committee’s Feb. 23 subpoena of Salesforce emphasized its interest in the company’s hosting of Trump emails asking for new donations that included false claims of election fraud.

It’s part of a central question the panel hopes to answer: Did Trump find new ways to keep the money coming in after his loss by shifting from a presidential campaign to a “Stop the Steal” effort?

“I think the level of grift that was involved with the Trump campaign and people close to the former president, how the January Six efforts were for many of them, this is what they were doing to make money,” said California Democratic Rep. Pete Aguilar, a member of the Jan. 6 panel. “We are looking into that.”

The committee’s investigators are broken down into highly skilled teams with core areas of focus, including one that’s on the money.

Aguilar says each team has been making “significant progress,” with regular presentations to the full committee on its findings. Each has been charged with devising a strategy for depositions and hearings.

“The committee has not tipped its hand of everything they have,” Eisen said. “They dedicated significant resources to the money trails. And I’m certain that in the hearings and in the final report, there’s going to be much more evidence revealed.”

This spring, the committee hopes to hold its first hearings illustrating the findings so far and issue an interim report by the summer with a final report this fall.

Spring Has Come, Victor Zaretsky, 1988

Let’s hope the arms of justice are getting ready to throttle the Trump Family Crime Syndicate.  Lock him up!

What’s really making me see red these days is the relentless media chatter about inflation and how it will blow back on the Democratic Party come November.  There really are a bunch of clueless people reporting on the economy. Every time I read one of these articles I scream.  I usually admire Catherine Rampell but this headline is just clickbait: “Opinion: Americans are unhappy with the economy. Many on the left don’t want to hear it.”  It’s on the Op-Ed page of The Washington Post.

I’ve spent hours this week being mansplained and dogmasplained things that are just are not true and the media is not helping by actually elucidating the situation. We had a demand shock, now the economy is growing gangbusters and that and a few other things that are market-oriented have created inflation.  It’s not really anything you can nail on to the folks on the fiscal side of economic policy.  This is the Fed’s bailiwick. It should cool down within 6 months but the Russian Invasion of Ukraine has created a lot of uncertainty. All bets are off on predictions of economic factors when they are based on history and theory and can’t predict the number of black swans we’ve had recently which include the invasion, Covid-19, and 4 years of an insane, criminal US President.

Inflation is spiking, and Democrats — who, rightly or wrongly, are poised to take the blame this November — appear to be in denial about it.

Consumer prices rose 7.9 percent in February from a year earlier, the Bureau of Labor Statistics reported Thursday. This was, yet again, the fastest pace of price growth in four decades. The increases were broad-based, affecting food, fuel, airfares, shelter, and more. Meanwhile, worker paychecks fell further behind, as overall inflation outpaced average wage growth.

These data were collected largely before the Russia-related run-up in global energy prices. Which suggests that next month’s overall inflation reading could be worse.

Given these trends, Americans are unhappy with the economy. But many on the left don’t want to hear it.

In recent months, many Democrats and their allies have approached the (political) problem of inflation by either denying any serious issue exists; or acknowledging it exists but demagoguing about its cause.

Some lefty politicians and commentators have argued that inflation is not that big of a deal. Americans have been tricked into thinking things are bad mostly because the media (and/or Republicans) keep telling them things are bad, this argument goes. Articles such as this one, drawing attention to inflation, are to blame.

I actually agree that much of the economic coverage has fallen short. For example: Contrary to recent headlines, gas prices aren’t really at all-time highs, at least not when adjusted for the changing value of the dollar. And there has been much more emphasis on soaring prices (bad news, boo) than on dwindling unemployment (good news, yay!).

Yet, it’s delusional to think that ordinary people wouldn’t care much about inflation if only the media stopped discussing it. People notice when they pay more for groceries, rent, gasoline, pet food, diapers. It is painful. It is unsettling. And inflation affects a broader swath of people than does a change in the unemployment rate, so more people are going to complain.

Viktor Zaretsky: By the Lake (1978)

Rampell wrote this last December “Every time I think the inflation discourse can’t get dumber, I’m proven wrong.”   I completely agree with that assertion.

Corporate greed. The cancellation of an oil pipeline that didn’t yet exist. A secret plot to cancel Halloween.

Every time I think the inflation discourse can’t get dumber, I’m proven wrong.

To be fair: The forces behind inflation, like many economic problems, are complicated. Economists can’t fully explain what determines current pricing behavior and inflation expectations in the real world, much less precisely predict where prices will land in a few months. New waves in the pandemic aren’t helping, either.

Most inflation predictions that top forecasters made in the spring turned out to be much too low. Elite academic economists, when surveyed about the risks of prolonged inflation, candidly acknowledge a lot of uncertainty.

All of which means there’s a lot of room for reasonable error on this issue, even among experts. But lately partisan factions have concocted new, unreasonable sources of error, too. Some of this rhetoric has been impressively creative; it’s basically like inflation fan fiction.

We economists really don’t assign pejorative terms to the actions of economic agents but I can tell you, huge oligopolies are going to take advantage of the situation and get whatever they can out of it. Let’s look at this.

There are three factors driving oil prices right now.  None can be controlled by a President.  First, the bounceback in demand due to increased driving now that Covid-19 shutdowns have slowed down and people are going back to work and school. Second, the uncertainty around the Russian invasion of Ukraine since Russia is an OPEC member.  Third, Oil companies are using the run-up to do what profit and bonus loving companies always can do when there are few producers (oligopoly) and no real ability for a government to regulate a world market.

There are lots of leases and permits out there for any US oil company to Drill Baby Drill. Biden has even increased their availability.  They are not exercising them. They’re happy with the high prices coming back.  Or, as Jen eloquently put it to Dumbo Doucy:

I suppose I shouldn’t mention here that I think he’s just a sub looking for the right Dom but he asks these stupid questions over and over.

And look to my tweet for what they are doing which is exactly what the Trump tax cuts and the Bush tax cuts incented them to do.  You make more money doing Wall Street tricks than you do when you actually do your business.  Nowhere is this more true than any extraction business.

Girls Victor Ivanovich Zaretsky, 1962

From the Financial Times: “Big Oil on course for near-record $38bn in share buybacks.  Seven majors set for supercharged stock purchasing on top of estimated $50bn of dividends”  This is all going on while Biden is scrambling to find any OPEC member that will release the gushers and opening the country’s reserves.  Read on and pay particular attention to what I highlighted.

Western energy majors are on course to buy back shares at near-record levels this year as soaring oil and gas prices enable them to deliver bumper profits and boost returns for investors. The seven supermajors — including BP, Shell, ExxonMobil and Chevron — are poised to return $38bn to shareholders through buyback programmes this year, according to data from Bernstein Research. Investment bank RBC Capital Markets put the total figure higher, at $41bn. That would be almost double the $21bn in buybacks completed in 2014 — when oil last traded above $100 a barrel — and the biggest total since 2008. The plans underscored the strength of companies that are reaping the rewards of a resurgence in energy demand as pandemic lockdown restrictions are rolled back. Gas prices are at record levels and oil is trading at a seven-year high of more than $90 a barrel, resulting in big profits for the supermajor group rounded out by TotalEnergies, Eni and Equinor.

Banks including Goldman Sachs expect Brent crude to trade at more than $100 this year, with some predicting that if Russia invades Ukraine it will trigger a sharper spike in energy costs.

Biraj Borkhataria at RBC Capital Markets said: “The sector is in the best shape it’s been in for a long time. Now the question is the duration of the cycle.” The underperformance of the companies’ shares during the pandemic meant that management teams felt their shares were undervalued and that buybacks were cheap, he added

Shell is set to lead the pack in 2022, buying back more than $12bn of its own shares, according to RBC and Bernstein. At least $8.5bn of those buybacks will be completed in the first half of the year, Shell said this month, including $5.5bn from the sale of its assets in the US Permian basin.

Chevron bought back shares worth $1.4bn in 2021 and has said it will spend $3bn to $5bn on buybacks this year.

If you were a CEO sitting on top of stock bonuses, etc what on earth would you do given “The sector is in the best shape it’s been in for a long time.”  They’re rational actors after all.  And wtf can President Biden do about any of this?  The entire energy sector is in great shape.  What incentives do they have to change?

So, that’s an explanation you can tell folks if you need to. The biggest thing that would bring prices down would be for Putin to stop his madness in Ukraine and the entire free world is working on that.

But, for some reason, Americans think they’re entitled to low gas prices and need large vehicles.  They forget the last cycles that have been recurrent since the 70s which basically all point back to OPEC which is a cartel that colludes to keep prices high until someone cheats and it falls apart and prices go down. That’s economics 101 stuff. I know this because I was in Economics 101 when the first Opec oil embargo hit. I even had a chance to listen to a panel of top Economists talk about it and got brave enough to ask a question.

Anyway, the Twitter round-up on Ukraine shows the world is trying to get to Putin.

EU Commission President Ursula von der Leyen said on Friday that Ukraine is “part of the European family” and that a fourth package of sanctions for Russia is coming along with a plan to wean the EU off Russian fuel sources by 2027. US President Joe Biden also announced plans to revoke Russia’s “most favored nation” trade status and ban key Russian goods like seafood, vodka and diamonds. Meanwhile, explosions were reported on Friday in Lutsk, near the Polish border, in Dnipro, a major stronghold in central-eastern Ukraine, and in Ivano-Frankivsk, in the south-west, Ukrainian authorities say.

So long Beluga caviar and Stolichnaya Vodka rich Americans!  Suck it up for Ukraine while the rest of us worry about gas and energy prices. And then there’s this piece of good news that sends me back to the research role in monetary and trade unions.

Okay, I hope I wasn’t too gloomy or doomy for you. I generously sprinkled the work of Ukrainian artist Viktor Zaretsky to break up the rest.

What’s on your reading and blogging list today?

Anyway, move over Trudeau and Macron, there’s a new guy in town!!