Month: May 2021

The Few Sentences That Explain Much of What Went Wrong With Our Pandemic Response

Mary Pat Campbell

Link: https://www.theinsight.org/p/the-few-sentences-that-explain-much

Excerpt:

Why did it take so long to accept that SARS-CoV-2 was being transmitted through aerosols, respiratory particles that are small enough to remain suspended in the air, rather than through short-range respiratory droplets that could not travel more than a few feet because of their (bigger) size?

The reasons for this delay go back more than a century, to the fight against (incorrect but prevalent) theories that blame miasma—noxious odors, especially from rotting organic material—for diseases. While trying to counter erroneous but millenia-long folk-beliefs, some of the founders of public health and the field of infectious control of diseases around the world made key errors and conflations around the turn of the 20th century. These errors essentially froze into tradition and dogma that went unchanged and uncorrected for more than a century, until a pandemic forced our hand.

Author(s): Zeynep Tufekci

Publication Date: 7 May 2021

Publication Site: Insight at substack

Why Did It Take So Long to Accept the Facts About Covid?

Mary Pat Campbell

Link: https://www.nytimes.com/2021/05/07/opinion/coronavirus-airborne-transmission.html

Excerpt:

But clear evidence doesn’t easily overturn tradition or overcome entrenched feelings and egos. John Snow, often credited as the first scientific epidemiologist, showed that a contaminated well was responsible for a 1854 London cholera epidemic by removing the suspected pump’s handle and documenting how the cases plummeted afterward. Many other scientists and officials wouldn’t believe him for 12 years, when the link to a water source showed up again and became harder to deny. (He died years earlier.)

Similarly, when the Hungarian physician Ignaz Semmelweis realized the importance of washing hands to protect patients, he lost his job and was widely condemned by disbelieving colleagues. He wasn’t always the most tactful communicator, and his colleagues resented his brash implication that they were harming their patients (even though they were). These doctors continued to kill their patients through cross-contamination for decades, despite clear evidence showing how death rates had plummeted in the few wards where midwives and Dr. Semmelweis had succeeded in introducing routine hand hygiene. He ultimately died of an infected wound.

Author(s): Zeynep Tufekci

Publication Date: 7 May 2021

Publication Site: New York Times

Negative Interest Rates

Mary Pat Campbell

Link: https://www.kamakuraco.com/wp-content/uploads/2021/01/Kamakura-NegativeRatesIACPM20200722v2.1.pdf

Graphic:

Excerpt:

What Can Go Wrong?
• Rate and Default Interaction
• Impairment to the Banking System
• Massive challenges to the Insurance Industry and Pension Funds
• Central Banks cannot force institutions to lend or creditworthy borrowers to borrow
• Huge overhang for refi in next 5 years
• “Negative Rates Cannot Cure Problems that Caused Rates to go Negative”

Author(s): Prof. Robert Jarrow, Donald R. van Deventer, Martin Zorn

Publication Date: 22 July 2020

Publication Site: Kamakura Corporation

Pension crisis has local impact

Mary Pat Campbell

Link: http://www.keweenawreport.com/featured/pension-crisis-has-local-impact/

Excerpt:

Keweenaw Report reached out to City of Houghton manager Eric Waara to see if there was a similar arrangement for DPW staff there. He said everyone’s plan was converted to MERS over a decade ago. Waara says Houghton’s fund is well over 80 percent covered, which is considered excellent. That means current assets can cover nearly all expected future liabilities related to retirement.

Publication Date: 6 May 2021

Publication Site: Keweenaw Report

What history tells you about post-pandemic booms

Mary Pat Campbell

Link: https://www.economist.com/finance-and-economics/2021/04/29/what-history-tells-you-about-post-pandemic-booms

Graphic:

Excerpt:

The record suggests that, after periods of massive non-financial disruption such as wars and pandemics, GDP does bounce back. It offers three further lessons. First, while people are keen to go out and spend, uncertainty lingers. Second, crises encourage people and businesses to try new ways of doing things, upending the structure of the economy. Third, as “Les Miserables” shows, political upheaval often follows, with unpredictable economic consequences.

Publication Date: 1 May 2021

Publication Site: The Economist

Is China’s population shrinking?

Mary Pat Campbell

Link: https://www.economist.com/china/2021/04/29/is-chinas-population-shrinking

Graphic:

Excerpt:

The Communist Party has long known that, partly as the result of its brutal birth-control policies, China’s population would soon peak and start to shrink. It has been startled, however, by how rapidly that moment has drawn near. Now, it looks as if it might have arrived.

….

There are also indications that China’s total fertility rate (the number of children a woman is expected to have in her lifetime) has dropped faster than previously thought. Chinese planners have assumed a rate of 1.8, but some Chinese scholars (and the World Bank) say it between 1.6 and 1.7. A working paper released in March by China’s central bank suggests the rate is no more than 1.5.

Publication Date: 1 May 2021

Publication Site: The Economist

How to tax capital without hurting investment

Mary Pat Campbell

Link: https://www.economist.com/leaders/2021/04/29/how-to-tax-capital-without-hurting-investment

Graphic:

Excerpt:

Governments raise most of their money by taxing wages, but President Joe Biden has his eyes fixed on the rich, big business and Wall Street. He proposes to fund his $2.7trn infrastructure plan in part by raising the corporate-tax rate from 21% to 28%. And to help pay for more spending on child care and support for parents, he wants to roughly double the top rate of federal tax on capital gains and dividends. For Americans earning more than $1m per year, he would bring levies on capital income into line with the top rate on wage income, which he wants to put up from 37% to 39.6%. That is about double the rate that is currently levied on rich investors, who are only a small fraction of the population but a large proportion of shareholders.

….

Tax capital lightly and it pays to disguise wages as capital income — a particularly lucrative pastime for the rich. One problem is the “carried interest” loophole. It lets private-equity and hedge-fund managers class their fees as capital gains rather than income. Another issue is the explosive growth in “pass through” firms, for example partnerships, which accounted for more than half of American business income by 2011, up from about a fifth in 1980.

Publication Date: 1 May 2021

Publication Site: The Economist

The origin of COVID: Did people or nature open Pandora’s box at Wuhan?

Mary Pat Campbell

Link: https://thebulletin.org/2021/05/the-origin-of-covid-did-people-or-nature-open-pandoras-box-at-wuhan/

Excerpt:

A tale of two theories. After the pandemic first broke out in December 2019, Chinese authorities reported that many cases had occurred in the wet market — a place selling wild animals for meat — in Wuhan. This reminded experts of the SARS1 epidemic of 2002, in which a bat virus had spread first to civets, an animal sold in wet markets, and from civets to people. A similar bat virus caused a second epidemic, known as MERS, in 2012. This time the intermediary host animal was camels.

….

Contrary to the letter writers’ assertion, the idea that the virus might have escaped from a lab invoked accident, not conspiracy. It surely needed to be explored, not rejected out of hand. A defining mark of good scientists is that they go to great pains to distinguish between what they know and what they don’t know. By this criterion, the signatories of the Lancet letter were behaving as poor scientists: They were assuring the public of facts they could not know for sure were true.

….

One of the very few establishment scientists to have questioned the virologists’ absolute rejection of lab escape is Richard Ebright, who has long warned against the dangers of gain-of-function research. Another is David A. Relman of Stanford University. “Even though strong opinions abound, none of these scenarios can be confidently ruled in or ruled out with currently available facts,” he wrote. Kudos too to Robert Redfield, former director of the Centers for Disease Control and Prevention, who told CNN on March 26, 2021 that the “most likely” cause of the epidemic was “from a laboratory,” because he doubted that a bat virus could become an extreme human pathogen overnight, without taking time to evolve, as seemed to be the case with SARS2.

Author(s): Nicholas Wade

Publication Date: 5 May 2021

Publication Site: Bulletin of the Atomic Scientists

Testimonies for full accrual based accounting during GASB public hearings

Mary Pat Campbell

Description:

This video contains 15 testimonies before the Governmental Accounting Standards Board (GASB) in March and April of 2021 by citizens, elected officials, think tank leaders, and more. All of whom argued against GASB’s proposals to continue cash-basis-like accounting for governmental funds statements. Cash-basis accounting supports bad government budgeting practices like counting borrowing proceeds as revenue, and underfunding pension funding requirements, in order to “balance budgets.” On the other hand, full accrual accounting shows expenses as they are incurred, especially when a government makes a promise to pay in the future.

Publication Date: 6 May 2021

Publication Site: Truth in Accounting channel at YouTube

Berkshire Hathaway’s Stock Price Is Too Much for Computers

Mary Pat Campbell

Link: https://www.wsj.com/articles/berkshire-hathaways-stock-price-is-too-much-for-computers-11620168548

Excerpt:

Berkshire Hathaway Inc. is trading at more than $421,000 per Class A share, and the market is optimistic. That’s a problem.

The price has grown so high, it has nearly hit the maximum number that can be stored in one common way exchange computers handle digits.

…..

Nasdaq’s computers can only count so high because of the compact digital format they use for communicating prices. The biggest number they can handle is $429,496.7295. Nasdaq is rushing to finish an upgrade later this month that would fix the problem.

It isn’t just Nasdaq. Another exchange operator, IEX Group Inc., said in March that it would stop accepting investors’ orders in Class A shares of Berkshire Hathaway “due to an internal price limitation within the trading system.”

Author(s): Alexander Osipovich

Publication Date: 4 May 2021

Publication Site: Wall Street Journal

Dan Walters, Dean of Sacramento Columnists, Blasts CalPERS’ Corruption-Friendly Secret Lending Bill

Mary Pat Campbell
Dan Walters, Dean of Sacramento Columnists, Blasts CalPERS’ Corruption-Friendly Secret Lending Bill

Excerpt:

Walters’ piece has been picked up by the Mercury News and other in-state papers. Since the bill has yet to go to the Senate, his intervention will make it much harder for Sacramento insiders to simply waive the legislation through and pretend they didn’t know about its rancid features.

We wrote up last week in part because the Judiciary Committee staff took the unusual step of sharply questioning whether CalPERS could and should be trusted with the powers it would provide. CalPERS wants to make loans and be exempt from disclosure…including who got the loan, in what amount, what the terms were (such as interest and collateral). The latter is important not just to determine if CalPERS is making proper credit judgments but also to see if it is handing out sub-market loans to cronies. There’s a proud history of this sort of thing. Remember, for instance, the “Friends of Angelo” scandal, when Countrywide gave out mortgages on extremely favorable terms to powerful politicians including Senate Banking Committee chair Christopher Dodd (D-CT), and Senate Budget Committee chair Kent Conrad.

Similarly, the reason yours truly has not been an advocate of public banks is they were tried in the US and virtually all failed. Most states and even some cities had them. All save North Dakota’s were eventually shuttered due to large-scale corruption and losses. I have not seen any of the proponents of public banks in the US demonstrate any awareness of their history of becoming piggy-banks for local notables, much the less recommend how to stop that from happening again. What CalPERS is proposing is an even more degraded version of the old, crooked, insider-controlled public banks.

Author(s): Yves Smith

Publication Date: 5 May 2021

Publication Site: naked capitalism