'We are crying out for help': Surge of attacks against Asian Americans due to COVID-19 conspiracies

Photos: Screen captures

Speaking to MSNBC on Sunday, a panel of actors and activists explained that the attacks on Asian Americans are growing as hostility over COVID-19 grows.
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Over the course of the last year, President Donald Trump and the far-right have spread conspiracy theories that China is responsible for the coronavirus. Presumably, many racists can't tell the difference between Chinese, Japanese and Vietnamese Americans, so they've attacked anyone even resembling an Asian American or Pacific Islanders.

In San Francisco, a 19-year-old is facing murder charges after he pushed an elderly Thai man so hard that he fell on the ground, hit his head on the pavement and died.

Just this weekend, a Yale graduate student was gunned down in the streets of New Haven, Connecticut. His name was Kevin Jiang and he was only 26-years-old with a birthday next week. While the police haven't found the murderer, they noted that this is another in a strange increase in gun violence the city is experiencing.

Last month, President Joe Biden issued a memorandum on the racist attacks against Asians and Pacific Islanders. But it was a recent attack in Oakland targeting a 91-year-old man, that motivated actors Daniel Wu and Daniel Dae Kim to offer a reward for anyone with information that could lead to an arrest of the man's killer.

Kim noted that the elderly community has already dealt with a lot over the past year with the pandemic, and now they're being attacked if they do leave their homes.

Civil Rights Activist Amanda Nguyen said that the country is reaching a "reckoning" and begged Americans to "wake up and choose love. And look, I know that sounds really corny, but the opposite of love isn't hate, it's apathy. Silence erases our humanity, yet it roars through the head of every Asian American as they step out the door."

https://www.msnbc.com/msnbc/embedded-video/mmvo100668997897

OPEN SCHOOLS NOT CAPITALI$M

Why Opening restaurants is exactly what the coronavirus wants us to do

Pro Publica
February 06, 2021

PRE COVID 19

Waiter pouring wine for customer

On Jan. 29, New York Gov. Andrew Cuomo was promoting “marital bliss" at a coronavirus news conference.
Announcing that indoor dining would reopen at 25% capacity in New York City on Valentine's Day, and wedding receptions could also resume with up to 150 people a month after, Cuomo suggested: “You propose on Valentine's Day and then you can have the wedding ceremony March 15, up to 150 people. People will actually come to your wedding because you can tell them, with the testing, it will be safe. … No pressure, but it's just an idea."

Cuomo isn't alone in taking measures to loosen pandemic-related restrictions. Michigan Gov. Gretchen Whitmer allowed indoor dining to resume at 25% capacity starting Feb. 1. Idaho Gov. Brad Little increased limits on indoor gatherings from 10 to 50 people. Massachusetts Gov. Charlie Baker is raising business capacity from 25% to 40%, including at restaurants and gyms. California Gov. Gavin Newsom lifted stay-at-home orders on Jan. 25.

To justify their reopening decisions, governors point to falling case counts. “We make decisions based on facts," Cuomo said. “New York City numbers are down."

But epidemiologists and public health experts say a crucial factor is missing from these calculations: the threat of new viral variants. One coronavirus variant, which originated in the United Kingdom and is now spreading in the U.S., is believed to be 50% more transmissible. The more cases there are, the faster new variants can spread. Because the baseline of case counts in the U.S. is already so high — we're still averaging about 130,000 new cases a day — and because the spread of the virus grows exponentially, cases could easily climb past the 300,000-per-day peak we reached in early January if we underestimate the variants, experts said.

Furthermore, study after study has identified indoor spaces — particularly restaurants, where consistent masking is not possible — as some of the highest-risk locations for transmission to occur. Even with distanced tables, case studies have shown that droplets can travel long distances within dining establishments, sometimes helped along by air conditioning.

We're just in the opening stage of the new variants' arrival in the United States. Experts say we could speed viruses' spread by providing them with superspreading playgrounds or slow them down by starving them of opportunities to replicate.

“We're standing at an inflection point," said Sam Scarpino, assistant professor at Northeastern University and director of the school's

Emergent Epidemics Lab. Thanks to the arrival of vaccines, he said, “we finally have the chance right now to bring this back under control, but if we ease up now, we may end up wasting all the effort we put in."

Dr. Luciana Borio, an infectious disease physician who was a member of the Biden-Harris transition team's COVID-19 advisory board, put it more bluntly at a congressional hearing on Feb. 3. “Our worst days could be ahead of us," she said.

I interviewed 10 scientists for this story and was surprised by the vehemence of some of their language. “Are you sure it could be that bad?" I asked, over and over.

They unanimously said they expected B.1.1.7, the variant first discovered in the U.K., to eventually become the dominant version of coronavirus in the U.S. The Centers for Disease Control and Prevention has estimated that B.1.1.7 will become dominant in March, using a model that presumes it's 50% more transmissible than the original “wildtype" coronavirus. The model's transmission rate was based on experience in the U.K., which first detected B.1.1.7 in September and saw an increase in cases that became apparent in December, straining hospitals despite stringent closures and stay-at-home orders. So while our country appears relatively B.1.1.7-free right now, the situation could look drastically different in a matter of months.

Experts are particularly concerned because we don't have a handle on exactly how far B.1.1.7 has spread. Our current surveillance system sequences less than 1% of cases to see whether they are a variant.

Throwing an even more troubling wrench into the mix is that B.1.1.7 is continuing to morph. Just this week, scientists discovered that some B.1.1.7 coronaviruses in Britain had picked up a key change, known as the E484K mutation. That mutation had previously been found in the B.1.351 variant, which was first discovered in South Africa. Scientists have hypothesized that it's the E484K mutation that has reduced the efficacy of some vaccines in South African trials, so this is incredibly worrying news.

“It's really hard to thread this needle without sounding like a prophet of doom," said Angela Rasmussen, a virologist at Georgetown University's Center for Global Health Science and Security. While vaccines bring hope, she said, governors who are moving to expand indoor dining are “completely reckless"; if they don't course correct, “I don't think it's hyperbolic to say the worst could be yet to come."

The choices that our federal and state leaders make right at this moment will determine if we can bend the curve once and for all and start ending the pandemic, or if we ride the rollercoaster into yet another surge, this one fueled by a viral enemy harder to fight than ever before.

All of us have agency in deciding this narrative, Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, stressed. “Certainly you need to be prepared for the possibility that things might get worse in the light of the variants, but that is not inevitable because there are things that we can do to mitigate against it," he said in an interview. “We're not helpless observers of our own fate."

Fauci urged states to “double down on your public health measures … to have virtually everybody wear masks, to have everyone maintain social distance, to have everybody avoid congregate settings, and to have everybody wash their hands very frequently."

And don't wait until it's too late, warned Michael Osterholm, director of the Center for Infectious Disease Research and Policy at the University of Minnesota.

“We are so good at pumping the brakes after we've wrapped the car around the tree," he said. The new variants aren't being complacent. “There's still a lot of human wood out there for this coronavirus to burn."

To understand the epidemiologists' warnings, it helps to understand what variants are, how they have been behaving and our limitations in knowing exactly how far they have spread.

People have a bad habit of anthropomorphizing the coronavirus: ascribing human-like intentions to it, as if a microbe can discern that we finally have a vaccine and try to evade it. But viruses don't really have any schemes; they just reproduce. “Coronaviruses are a single strand of RNA in a sac of fat," epidemiologist Larry Brilliant reminded me. “They're preprogrammed to replicate and continue replicating. That's their job."

Once in a while, when a virus replicates, a mistake occurs, and a letter in the strand of RNA is copied inaccurately. That's called a mutation. Many times, those mutations are neutral. Sometimes they are detrimental to the virus, and that lineage will quickly die off. Other times, they're beneficial to the virus in some way, such as by making it more transmissible. When a version of the virus becomes functionally different, that's when scientists consider it a variant.

As of Feb. 4, according to the CDC, the U.S. has found 611 cases of B.1.1.7, the variant first discovered in the United Kingdom, five cases of B.1.351, first identified in South Africa, and two cases of P.1., first identified in Brazil. But that's almost certainly an undercount.

Part of the reason why epidemiologists are advocating for us to stay hunkered down is because the U.S. doesn't know exactly where all the variant cases are.

The term that public health uses is “surveillance." I like to think of it as having eyes on the virus. In order to have good eyes on where coronavirus infections are in general, all you need is the regular swab tests that we're all familiar with. But in order to tell whether a positive case is the wildtype coronavirus or one of the more nasty variants, an additional step is needed: genomic sequencing. For that, the sample needs to be sent on to a lab that has specialized machinery capable of conducting sequencing.

Until recently, sequencing in the U.S. was a patchwork effort, conducted by a mix of academic and public health agency labs keen to track the evolution of the coronavirus. Though the CDC hosted a weekly call where those scientists already conducting sequencing could compare notes, there was no dedicated federal funding or coordination to ensure that samples were routinely gathered from across the country.

Today, the U.S. sequences less than 1% of its total cases. This is a pittance compared to the U.K., which sequences around 8-10% of its positive test results. But volume alone isn't the only thing that matters. Representation, meaning where the samples come from, is another crucial factor. Since most of the sequencing so far has come from voluntary efforts, the U.S. has suffered from uneven visibility, with a whole bunch of eyeballs in parts of the country that are biotechnology and academic hubs, like Boston, San Francisco and San Diego, and less in “surveillance deserts" like North and South Dakota. There, barely any samples have been sequenced at all, even when those states had explosions of COVID-19 cases.

Dr. Phil Febbo is chief medical officer at Illumina, one of the world's biggest sequencing technology companies. Like so many parts of the coronavirus response, keeping a lookout for variants has suffered from a lack of federal leadership, Febbo said. As early as March of last year, Illumina representatives began meeting with federal agencies, advocating for a national genomic surveillance system.

“We talked to any three-lettered agency we could," Febbo said. “Those conversations were cordial: They said they heard what we were saying, but then they'd say, 'But we need more tests, but can you do it in five minutes, can it be point-of-care?'" It wasn't until Dec. 18, when B.1.1.7 was taking off in the United Kingdom, that Illumina finally got a call from the CDC offering to sign a contract with the company. (Since December, CDC has engaged Illumina to do surveillance work by signing twocontracts potentially worth up to $4.6 million.)

Today, Illumina sequences positive samples that are passed on from a diagnostic testing company, Helix. Each RNA strand of the SARS-CoV-2 virus has about 30,000 nucleotides, each represented by one of four letters. Illumina's sequencers read through each sample's code and compare each letter to a reference sequence, looking for significant changes. The data gets passed back to the CDC, which uses location data stripped of personal identifiers to map the spread of any variants that Illumina has picked up.

The CDC said it has contracted with several large commercial companies with the goal of sequencing up to 6,000 samples a week by mid-February. Through another program, called the National SARS-CoV-2 Strain Surveillance System, state public health labs are supposed to send a total of 1,500 samples to the agency every other week. This program went into effect on Jan. 25 and is still ramping up, according to a CDC spokesperson.

Febbo says more can be done to increase surveillance. He notes that the Biden administration, while clearly more invested in variant surveillance than the Trump administration, hasn't set a public target in the same way it has for vaccinations with its “100 million shots" campaign. Illumina estimates that sequencing 5% of all samples would allow us to be confident that we are catching all variants of concern, and he would like the Biden administration to make that a public goal. It can be done, Febbo says: “It hasn't been the lack of capacity, it's been the lack of will."

Having clearer information about where variants are would give governors and local officials actual information with which to make decisions. Then they could say with confidence, “We can open indoor dining because we know that the variants aren't circulating in our community." Absent that information, the only thing we can do is act like the variants are here.

The good news is that so far, the vaccines that have been made available to the public appear to be reasonably effective against the coronavirus variants. They may be slightly less effective against B.1.351, the variant discovered in South Africa, but none of the variants are total “escapes," so a vaccine should offer you at least partial protection against any form of the coronavirus you encounter.

All of the available shots give your immune system some familiarity with the virus, allowing it to be more prepared to meet the bug in the wild, whether it's the original strain or a variant. Having a savvier immune system, in turn, means that even if you do get infected, you're less likely to need to be hospitalized, and less likely to die.

“Regardless of what's happening with this variant, we're much better with people seeingSARS-CoV-2 after seeing the vaccine than not," said Derek Cummings, a biology professor at the University of Florida's Emerging Pathogens Institute.

However, we're not very far along with vaccinations yet. As of F eb. 4, only 2.1% of the U.S. population had been reported to have received both doses of the vaccine; 8.5% had received one dose. That means we're in a precarious moment right now where the vast majority of the U.S. hasn't had a chance to get protected, and the variants have a window to multiply. (Of course, those who have already gotten sick with COVID-19 have natural immunity, but some scientists are concerned that those who develop only mild symptoms may not gain as much innate immunity as those who receive a vaccine.)

Of the scientists I talked to, Caitlin Rivers, a computational epidemiologist at Johns Hopkins Center for Health Security, was the most optimistic about a potential variant-fueled surge. “I do think that B.1.1.7 has the possibility to precipitate a wave, but it probably won't be as bad as the last wave, because we have a lot of preexisting immunity and we are rolling out the vaccines," she said. Thanks to the vaccines, the U.S. will have more population immunity by March, when the CDC predicts B.1.1.7 will become dominant, than the U.K. did when the variant hit there late last year. “It's a low likelihood that we will have a gigantic fourth wave, but not impossible," she said.

Still, Rivers said, “now is not the time to relax." She, too, was critical of state policies to loosen restrictions. “When you create the same conditions that allowed the last surge, you should expect the same results," she said. “Our main move should be to reduce transmission as much as possible while we vaccinate as much as possible."

Time is not on our side, as the morphing B.1.1.7 variant showed us when it picked up the E484K mutation. While we are lucky that our vaccines still work against the current variants, we have to keep in mind that in this race between vaccines and variants, the variants aren't staying static.

The big fear is that eventually, a variant will come along that provides the virus with a complete immune escape, preventing our vaccines from working against it. Even though we can update our vaccines, that would take time. The only way to guarantee that the virus won't mutate into a variant that our current vaccines don't cover is to lower transmission significantly, said genomic epidemiologist Alli Black: “The virus will continue to mutate as it continues to spread. We're not going to stop that biological fact unless transmission stops." And vaccinating everyone quickly is one key way to make it harder for the coronavirus to get from person to person in the first place.

“We need to start responding like the variants are going to take over and they are one of the biggest threats," said Cummings, “or we won't have vaccinated enough people when this rolls through."

Throughout this pandemic, the U.S. has often been in the fortunate position of not being first when it comes to novel viral encounters. We weren't the country where SARS-CoV-2 originated. We weren't the place where B.1.1.7 was spawned. We've had the opportunity to look to other countries and learn from them, if only we'd choose to.

Epidemiologist after epidemiologist pointed out that the U.K., Denmark and Portugal required drastic measures— the dreaded L word, “lockdown" — to get B.1.1.7 under control. “We've seen that multiple different countries in Europe have had to close schools after making it a policy that schools would be the last to close," Rivers, from Johns Hopkins, noted.

If we don't want the same fate to befall the U.S., now is the time to act, the scientists urged.

Improving surveillance can help. Utah Public Health Laboratory has a robust state sequencing program, analyzing a random sample of cases sent by the state's two largest hospital groups. Kelly Oakeson, its chief scientist for next generation sequencing and bioinformatics, has set a goal of sequencing 10% of all cases in the state; his lab is currently doing about 3%. They could do more, he said. The only problem is that they don't have enough pipette tips due to a national shortage. Oakeson said he's hoping that the Biden administration will leverage the Defense Production Act to produce more pipette tips so he can increase his state's surveillance capabilities.

“We can't get transmission down through vaccination alone," said Rasmussen, the Georgetown virologist. “We need to be encouraging leadership, both at the state and federal levels, to protect people, to have paid sick leave for people if they become symptomatic."

A restaurant server in New York City, who was laid off early in the pandemic from a high-end steakhouse, told me he understood what the epidemiologists were saying from a scientific point of view. But, he asked, “if you want to shut everything down, who's going to pay the bills?"

He continued, “In order to do what the epidemiologists want to get done, you can only do that with policies to support the people and make it worth their while to do it." He's job hunting, and he said that if he was offered a position that put him indoors on Valentine's Day, “I would have to take it." He'd put on a double mask and go to work.

Whenever we have options, though, individual decisions can make a difference. Black, the genomic epidemiologist, encouraged everyone to limit travel as much as possible: “It just really facilitates introductions of these circulating variants."

Hang in there, urged Scarpino, the Northeastern professor, painting a hopeful picture: “Cases are coming down, vaccines are going up. Let's pretend that politicians wake up and don't reopen restaurants and we avoid a big wave in March. Then we're running downhill on the vaccines because the pipeline gets better and better. Then we can get our lives back."

That sounded so tantalizing. Dream-worthy. Just a matter of good science-based public policy and collective compliance driving down the case counts until those little mindless RNA-filled fat sacs have nowhere to go, no one to infect, no way to replicate, no chances to mutate. I imagine them bumping around, lost without crowded indoor spaces to breed in, thwarted by vaccine-boosted immune cells, unable to find a host, dwindling, going, gone.

Some scientists believe life may have started on Mars -- here's why
Nicole Karlis, Salon
February 07, 2021

The presence of methane has long been a point of contention among Mars experts

 EUROPEAN SPACE AGENCY/AFP/File / HO

On February 18, NASA's Perseverance rover will parachute through thin Martian air, marking a new era in red planet exploration. Landing on the Jezero Crater, which is located north of the Martian equator, will be no easy feat. Only about 40 percent of the missions ever sent to Mars succeed, according to NASA. If it does, Perseverance could drastically change the way we think about extraterrestrial life. That's because scientists believe Jezero, a 28 mile-wide impact crater that used to be a lake, is an ideal place to look for evidence of ancient microbial life on Mars.

Once it lands, Perseverance will collect and store Martian rock and soil samples, which will eventually be returned to Earth. This is known as a "sample-return mission," an extremely rare type of space exploration mission due to its expense. (Indeed, there has never been a sample return mission from another planet.) And once Martian soil is returned to Earth in a decade, scientists will set about studying the material to figure out if there was ever ancient life on Mars.

Yet some scientists believe that these samples could answer an even bigger question: Did life on Earth originate on Mars?

Though the idea that life started on Mars before migrating on Earth sounds like some far-fetched sci-fi premise, many renowned scientists take the theory seriously. The general idea of life starting elsewhere in space before migrating here has a name, too: Panspermia. It's the hypothesis that life exists elsewhere in the universe, and is distributed by asteroids and other space debris.

To be clear, the notion of life on Earth originating on Mars isn't a dominant theory in the scientific community, but it does appear to be catching on. And scientists like Gary Ruvkun, a professor of genetics at Harvard Medical School, say that it does sound "obvious, in a way."

The evidence starts with how space debris moved around in the young solar system. Indeed, we have evidence of an exchange of rocks from Mars to Earth. Martian meteorites have been found in Antarctica and across the world — an estimated 159, according to the International Meteorite Collectors Association.

"You can assign them to Mars based on the gaseous inclusions that they have, that are sort of the equivalent of the gases that were shown by the Viking spacecraft" to exist in Mars' atmosphere, Ruvkun said. In other words, small bubbles of air in these rocks reveal that they were forged in the Martian air. "So, there is exchange between Mars and Earth — probably more often going from Mars to Earth because it goes 'downhill,' going to Mars is 'uphill,' gravitationally-speaking."

But for Ruvkun, whose area of expertise is genomics, it's the timing of cellular life that he believes makes a strong case that life on Earth came from somewhere else — perhaps Mars, or perhaps Mars vis-a-vis another planet.

Ruvkun noted that our genomes reveal the history of life, and provide clues about the ancestors that preceded us by millions or even billions of years. "In our genomes, you can kind of see the history, right?" he said. "There's the RNA world that predated the DNA world and it's very well supported by all kinds of current biology; so, we know the steps that evolution took in order to get to where we are now."

Thanks to the advancement of genomics, the understanding of LUCA (the Last Universal Common Ancestor) — meaning the organism from which all life on Earth evolved from — has greatly advanced. By studying the genetics of all organisms on Earth, scientists have a very good sense of what the single-celled ancestor of every living thing (on Earth) looked like. They also know the timeline: all modern life forms descend from a single-celled organism that lived about 3.9 billion years ago, only 200 million years after the first appearance of liquid water. In the grand scheme of the universe, that's not that long.

And the last universal common ancestor was fairly complicated as far as organisms go. That leaves two possibilities, Ruvkun says. "Either evolution to full-on modern genomes is really easy, or the reason you see it so fast was that we just 'caught' life, it didn't actually start here." He adds, "I like the idea that we just caught it and that's why it's so fast, but I'm an outlier."

If that's the case, then Erik Asphaug, is a professor of planetary science at the University of Arizona, is also an outlier. Asphaug said that what we know about the oldest rocks on Earth — which have chemical evidence of carbon isotopes, tracing back to nearly 4 billion years ago — tell us that life started "started forming on Earth almost as soon as it was possible for it to happen."

If that's the case, it makes for an interesting precedent. "Let's say you expect life to be flourishing whenever a planet cools down to the point where it can start to have liquid water," Asphaug said. "But just looking at our own solar system, what planet was likely to be habitable first? Almost certainly Mars."

This is because, Asphaug said, Mars formed before Earth did. Early in Martian history when Mars was cooling down, Mars would have had a "hospitable" environment before Earth.

"If life was going to start anywhere it might start first on Mars," Asphaug said. "We don't know what the requirement is — you know, if it required something super special like the existence of a moon or some factors that are unique to the Earth — but just in terms of what place had liquid water first, that would have been Mars."

An intriguing and convincing piece of evidence relates to how material moved between the two neighboring planets. Indeed, the further you go back in time, the bigger the collisions of rocks between Mars and Earth, Asphaug said. These impact events could have been huge "mountain-sized blocks of Mars" that were launched into space. Such massive asteroids could serve as a home for a hardy microorganism.

"When you collide back into a planet, some fraction of that mountain-sized mass is going to survive as debris on the surface," he said. "It's taken a while for modeling to show that you can have a relatively intact survival of what we call 'ballistic panspermia' — firing a bullet into one planet, knocking bits off, and having it end up on another planet. But it's feasible, we think it happens, and the trajectory would tend to go from Mars to the Earth, much more likely than from Earth to Mars."

Asphaug added that surviving the trip, given the mass of the vehicle for the microorganisms, wouldn't be a problem — and neither would surviving on a new, hospitable planet.

"Any early life form would be resistant to what's going on at the tail end of planet formation," he said. "Any organism that's going to be existing has to be used to the horrific bombardment of impacts, even apart from this, swapping from planet to planet."

In other words, early microbial life would have been fine with harsh environments and long periods of dormancy.

Harvard professor Avi Loeb told Salon via email that one of the Martian rocks found on Earth, ALH 84001, "was not heated along its journey to more than 40 degrees Celsius and could have carried life."

All three scientists believe that Perseverance might be able to add credibility to the theory of panspermia.

"If you were to go and find remnants of life on Mars, which we hope to do with Perseverance rover and these other Martian adventures, I would be personally surprised if they were not connected at the hip to terrestrial life," Asphaug said.

Ruvkun said he hopes to be one of the scientists to look for DNA when the sample from Mars hopefully, eventually, returns.

"Launching something from Mars is a seriously difficult thing," he said.

But what would this mean for human beings, and our existential understanding of who we are and where we came from?

"In that case, we might all be Martians," Loeb said. He joked that the self-help book "Men are from Mars, Women are from Venus" may have been more right than we know.

Or perhaps, as Ruvkun believes, we're from a different solar system, and life is just scattering across the universe.

"To me the idea that it all started on Earth, and every single solar system has their own little evolution of life happening, and they're all independent — it just seems kind of dumb," Ruvkun said. "It's so much more explanatory to say 'no, it's spreading, it's spreading all across the universe, and we caught it too, it didn't start here," he added. "And in this moment during the pandemic — what a great moment to pitch the idea. Maybe people will finally believe it."

LA REVUE GAUCHE - Left Comment: Search results for PANSPERMIA (plawiuk.blogspot.com)

Feds give update on probe in deadly Georgia poultry plant incident

2021/2/7 ©TheAtlantaJournalConstitution

Tanks of liquid nitrogen are seen at the Prime Pak Foods poultry processing plant after a liquid nitrogen leak on Jan. 28, 2021, resulted in six deaths and multiple hospitalizations in Gainesville, Ga.. - ELIJAH NOUVELAGE/AFP/AFP/TNS

ATLANTA — The federal investigative board looking into last month’s incident at a poultry processing plant in Gainesville has found that issues on a conveyor appear linked to the deadly chemical leak.

Six workers were killed at the Foundation Food Group on Jan. 28. The plant uses liquid nitrogen to flash-freeze chicken, and an “inadvertent release” happened on one of the plant’s five production lines. About a dozen people were injured and taken to a hospital, and 130 people were evacuated.

The U.S. Chemical Safety and Hazard Investigation Board released the following new details Sunday about the incident:

—The plant had been experiencing unresolved operational issues on the chicken conveyor that appear to have resulted in the accidental release of liquid nitrogen in the flash-freezing bath.

—The Chemical Safety Board has information that Line No. 4 was shut down the morning of the incident. The shutdown was due to operational issues on the conveyor line.

—Foundation Food Group maintenance personnel reported the computerized measuring system indicated a low liquid level in the immersion bath used to flash-freeze the chicken products.

—The liquid nitrogen units were manufactured and installed by Messer and are leased to the Foundation Food Group.

—The Foundation Food Group performs routine maintenance on the Messer-owned equipment.

Nitrogen, often used to flash-freeze food, is odorless, colorless and can reduce the oxygen in the air, cause asphyxiation or burns from the cold.

Killed in the gas leak were Jose DeJesus Elias-Cabrera, 45, of Gainesville; Corey Alan Murphy, 35, of Clermont; Nelly Perez-Rafael, 28, of Gainesville; Saulo Suarez-Bernal, 41, of Dawsonville; Victor Vellez, 38, of Gainesville; and Edgar Vera-Garcia, 28, of Gainesville.

WTF

The Chemical Safety Board’s work is ongoing, and the board’s chairman and CEO, Katherine Lemos, said at a Jan. 30 news conference in Gainesville that a full report could take several years. The board makes safety recommendations but does not issue citations or fines.

The plant is owned by Gainesville-based Foundation Food Group, which formed Jan. 1 after Prime-Pak Foods and Victory Processing merged, according to state records.

Mohamed El-Erian on the GameStop short squeeze: 

'We came very, very close to a market accident'

On the January jobs report:

'It's a disappointing report in many respects'

And he's also the Chief
Economic Advisor at Allianz.




Julie Hyman
·Anchor
Sat, February 6, 2021, 6:45 AM·3 min read

The latest move in the GameStop (GME) roller coaster was a 19% jump in the shares in Friday’s session that wasn’t enough to prevent an 80% slide on the week. While the short squeeze in GameStop and other heavily-shorted names may be abating for now, the factors underlying the action aren’t going away anytime soon. That means regulators’ job is just beginning.

“They have to play massive catch-up,” Mohamed El-Erian, president of Queens’ College at Cambridge University and chief economic advisor at Allianz, told Yahoo Finance Live. “We have done well in reducing systemic risk in the banking system, but what regulators haven’t done well is recognizing risk doesn’t disappear. It morphs and migrates, and it migrated to the non-banks.”

Those non-banks include platforms like Robinhood and other commission-free trading apps, which retail investors used to stage bull raids on GameStop and others. When the platforms were then forced to enact rolling trading restrictions by the trade clearing authority, there was a ripple effect throughout the broader equity market, ending in the worst week for stocks since October. (Stocks since rebounded, with the major averages posting their best weekly performance since November).

El-Erian said while the outburst may have been brief, it sent a signal.

“The biggest signal for someone who’s investing in the market as a whole is that there is a lot of risk-taking, and a lot of leverage. And rightly so, because liquidity is abundant, and the cost of borrowing is so low. But a lot of leverage tends to create excessive risk-taking,” he said. “And therefore, the risk of a market accident goes up. Last week we came very, very close to a market accident — very close. It was avoided through various things, but we came very close.”

The “underlying forces that propelled the uprising” persist, El-Erian wrote in an op-ed in the Financial Times — and could cause more disruptions.


Regulators appear to be in information-gathering mode for now. Treasury Secretary Janet Yellen on Thursday convened a meeting of the heads of the U.S. Securities and Exchange Commission, Commodities Futures Trading Commission, Federal Reserve Board and Federal Reserve Bank of New York. As Yellen said in an interview with ABC, “we need to understand deeply what happened before we go to action.”

That understanding will take time, in part because there are competing constituents, as El-Erian points out.

“You have four competing claims on the regulatory process. One is the protection of the small investors. Two, you have a question of, is Reddit some sort of collusion, some sort of market manipulation? Three, we have questions about the intermediary and hedge funds. Was there collusion there? And four, you have a question of investment suitability.”

Because of the thorny process of teasing all of that out, “I doubt that you’re going to see deterministic action any time soon,” he said.

Julie Hyman is the co-anchor of Yahoo Finance Live, weekdays 9am-11am ET.

Read the latest financial and business news from Yahoo Finance

Robinhood’s Collateral-Crunch Explanation Puzzles Wall Street

Annie Massa, Yalman Onaran and Matthew Leising
Sat, February 6, 2021, 6:00 AM·7 min read

(Bloomberg) -- A week after Robinhood Markets tried to clear the air by explaining why it slapped controversial limits on trading hot stocks, Wall Street’s risk professionals are still perplexed: How was the firm so ill-prepared for an obvious surge in collateral calls?

To the financial industry, anticipating collateral demands from hubs such as the Depository Trust & Clearing Corp. is Brokerage 101. Major firms assign teams to study the DTCC’s methodology, estimate its requests and make sure ample cash is available. Everyone grumbles, sure, but they also know what happens when firms fall short: They scramble for a lifeline or shut down. Robinhood gathered billions from backers to keep it going.

“They obviously fell very, very short,” said David Weisberger, a market-structure consultant who built trading systems at Salomon Brothers and Morgan Stanley. He said he’s been puzzling over Robinhood, given what he called the “well known” requirements of clearinghouses. “This was a franchise-threatening event.”


The Silicon Valley startup left users fuming by temporarily restricting certain purchases at the height of January’s mania over GameStop Corp. and other “meme stocks” that were in the midst of skyrocketing. By the end of this week, as millions of customers were downloading its app to trade the fallen darlings and new ones, risk managers were still stuck on how Robinhood ended up in the predicament.

Reached for comment, a company spokesperson referred to a Thursday blog post by the president and chief operating officer of Robinhood Securities, Jim Swartwout.

“We have grown rapidly. And we have, at times, encountered challenges as we’ve scaled to meet this moment,” Swartwout wrote, describing how the firm’s growth and a surge in trading volume fueled collateral demands. “To say the overnight increases in volume Robinhood experienced last week were extraordinarily high would be a vast understatement. The surge was magnitudes higher than the norm.”

Chief Executive Officer Vlad Tenev has linked the trading restrictions to a roughly $3 billion collateral call that arrived early Jan. 28 from part of the DTCC, which Robinhood has said contributed to a 10-fold jump in weekly clearinghouse deposit requirements for equities. While Tenev has credited the DTCC for being reasonable and ultimately accepting $700 million, he has at times portrayed its formulas as opaque, noting they include a “discretionary” component.

“We don’t have the full details” of how the DTCC arrived at its initial demand, Tenev told Elon Musk last weekend in an interview broadcast on the social-conversation app Clubhouse. “It would obviously be ideal if there was a little bit more transparency so we could plan better around that.”

The rejoinder from industry executives: It’s pretty much just math.

‘Shame on Them’

In interviews, more than a half-dozen senior risk executives -- some from Wall Street’s largest firms -- reacted with bemusement to any assertions that the magnitude of the DTCC’s demands can’t be anticipated. They spoke on the condition they not be identified, in some cases because they interact with Robinhood.

They acknowledged there’s always complaining about the difficulty of pinpointing what clearinghouses will seek, and that things can go wrong. Some executives even recounted times when they got pressed for millions of additional cash on short notice. But overall, the group said that large, well-run firms don’t get surprised by requests that threaten to empty their pockets.

One brokerage executive said Robinhood should have ensured it had enough capital or stopped processing trades of volatile stocks. Charles Schwab Corp.’s TD Ameritrade, for example, began limiting bets on certain meme stocks the day before Robinhood did. Robinhood’s later restrictions were more severe, tapering off into the week that followed.

“Once every decade or so there are improbabilities that occur,” said Weisberger, who now runs cryptocurrency venture CoinRoutes. Self-clearing firms such as Robinhood need to know what potential demands they could face. “If they studied it and came up with an answer and it was wrong, well shame on the people who studied it,” he said. “If they didn’t study it, well then shame on them.”

Avoiding Surprises

The DTCC bases much of its deposit demands on elements including a clearing member’s concentration in volatile stocks, the volume of trades occurring, imbalances in buying and selling, and the firm’s financial condition. The more a brokerage is exposed to erratic shares, the more collateral it has to post. The less capital a brokerage has on hand, the more severe its surcharge may be.

The goal is to protect the broader financial system from trading defaults. To make collateral calls predictable, the DTCC says it provides “reporting and other tools to our clearing members to help them anticipate their margin requirements for a particular portfolio.”

The nightmare that clearinghouses are designed to avoid is that a brokerage loses so much money before a trade is completed that the firm can’t hold up its end of the transaction. Without a clearinghouse, one firm’s failure could cascade through the financial system. Unwinding just one trade means undoing all of the subsequent transactions if that share already was resold.

A broker-dealer’s collateral burden rises if it lends money to customers, and especially if they bet heavily on, say, stocks that have recently multiplied in value, as GameStop and others did last month. If prices suddenly crash -- which also happened -- it raises the risk that clients may not be able to repay their margin loans, leaving the brokerage to eat their losses. Some of the recent stock declines may be attributable to Robinhood liquidating clients’ positions to head off defaults on loans, according to Wall Street risk managers.

“Someone’s got to pay,” said Eric Budish, a professor of economics at the University of Chicago’s Booth School of Business. If you’re a brokerage, “you have capital to deal with that existential risk. I was surprised Robinhood didn’t have more capital for that scenario.”

Margin lending constituted about 20% of Robinhood’s $6.7 billion balance sheet in mid-2020. Robinhood tapped credit lines and raised about $3.4 billion from investors at the end of January.

Robinhood, founded in 2013, has been hiring Wall Streeters to help integrate the startup into the more traditional financial system. The firm appointed former Securities and Exchange Commission member Dan Gallagher, Fidelity Investments’ Norm Ashkenas and Wells Fargo & Co.’s Kelly Zigaitis to senior legal and compliance roles.

Robinhood’s Prescription

This week, Robinhood offered its own prescription to avoid future problems: The U.S. stock market should abandon its two-day settlement system and switch to a real-time process.

Moving the U.S. equity market to instantaneous settlement is a huge undertaking that would require years of work. Two components of trading would probably need to be digitized: The securities and the cash to pay for them. Digitally representing a security like a stock or bond isn’t difficult and a small-scale effort by Paxos Trust Co. to use blockchain to settle stock trades in near real-time received a green light from the SEC in 2019.

Digitizing U.S. dollars to pay for stocks is years off, if it ever happens. Another hurdle is all of the banks, brokerages, hedge funds and trading firms that buy and sell shares would need to update their systems to make the change. The transition would no-doubt be expensive.

Australia embarked on a plan to do just that in 2016 when Digital Asset Holdings announced a deal with ASX Inc. to remake the Australian Stock Exchange so settlement times could be cut from days to minutes. The project has been extended repeatedly and is currently two years behind schedule.

Meanwhile, Robinhood is fortunate to have access to venture capital to weather a rough patch, said Joanna Fields, founding principal at market structure consultancy Aplomb Strategies.

“There are firms that have controls, governance frameworks and processes, and that do not have the capability of getting that kind of capital infusion,” she said.

©2021 Bloomberg L.P.

Toshiba CEO Kurumatani Shouldn’t Put Politics and Personal Agenda Before Shareholders




Toshiba Corporation’s 1 Trillion Yen ($9.5 Billion) Investment Plan Blindsided Shareholders


Toshiba Sets Operating Income as Growth Target at Potential Expense of Shareholder Value


Toshiba CEO Kurumatani Resists Modern Corporate Governance Standards


Other Japanese Companies Have Taken Far Bigger Strides to Improve Governance


Farallon, Effissimo Request More Transparency, Seek EGMs


Toshiba Trades at Steep Discount to Peers, Likely Reflecting Governance Concerns

By Jarrett Banks and John Jannarone

Toshiba Corporation was once the face of corporate Japan’s global rise. As a 50 percent partner in Time Warner’s film and television business in the early 1990s, it passed on the movie adaptation Michael Crichton’s Rising Sun, in what was seen as a power move.

Although times have changed and the company is no longer involved in the film industry, Toshiba President and CEO Nobuaki Kurumatani seems stuck in the past when it comes to value creation and corporate governance.

Founded in 1875 just a few years after the Meiji Restoration that ended rule under the shogunate, Toshiba is much older than other Japanese electronics majors like Hitachi, Panasonic and Sony. But the usual way of thinking at Japanese conglomerates toward foreign shareholders—we’ve been running the show for centuries and don’t care about your opinions—isn’t going to cut it anymore.

Overseas investors bailed out Toshiba in 2017 by participating in a $5.4 billion share offering after accounting scandals and concerns about its nuclear power business threatened the Japanese company’s survival. But now, Mr. Kurumatani doesn’t want to listen to those investors or others seeking reform.

Toshiba’s pursuit of growth in operating income rather than prudent value creation has been painful for shareholders, with the company making serial acquisitions that rarely worked out. There is a risk that Mr. Kurumatani hasn’t learned from the past. So far, he appears concerned about making the company bigger rather than return on investment, which requires serious capital discipline.

Toshiba doesn’t have a good track record of successfully integrating acquisitions, and investors are right to ask why this time could be any different. Major acquisitions and investments have led to write-downs, indicating Toshiba may have wandered into businesses where it didn’t belong.

That has translated to an abysmal stock performance. The shares have fallen 47% in the last decade while the benchmark Nikkei 225 has nearly tripled.

The massive conglomerate, which employs 130,000 people, narrowly avoided a delisting from the Tokyo Stock Exchange three years ago after multibillion-dollar losses at its Westinghouse nuclear unit pushed liabilities beyond its level of assets. It was forced to sell its prized semiconductor business and take an infusion of cash from a large contingent of activist shareholders. The writedowns and accounting scandals triggered a management shakeup and the appointment of Mr. Kurumatani, the first outsider named CEO in over half a century.

Although Japan has made a concerted effort in recent years to bring corporate governance up to a higher standard, Mr. Kurumatani has been shifting strategy with the wind. In December, activist fund Farallon Capital, which owns a 5.37% stake, asked the conglomerate to convene an extraordinary general meeting of shareholders to seek approval before the company can make significant changes to the Toshiba Next Plan. Farallon said it was deeply concerned that Toshiba suddenly announced a growth strategy that was materially different from the plan already in place.

Amazingly, shareholders explicitly requested the ability to have a say on capital allocation policy at the 2020 annual meeting. That provision exists at many other Japanese companies but had been absent at Toshiba until last year. But just a few months later, Mr. Kurumatani essentially went rogue by announcing his big M&A plans.

Such a flagrant disregard for shareholders could cause trust in Mr. Kurumatani to erode. Any nods to the will of shareholders appear to be transactional moves designed to temporarily mollify them rather than earnest corporate policy changes.

But shareholders are unlikely to give up. Last year, Singapore-based activist fund Effissimo Capital Management, Toshiba’s largest shareholder with a 10% stake, narrowly failed to install three directors on the Japanese company’s board. This year, things could easily swing the other direction.

Then there are Mr. Kurumatani’s political connections – which he has possibly used to interfere with shareholder votes. The Financial Times reported that, ahead of Toshiba’s July 2020 AGM, the former head of Japan’s Government Pension Investment Fund held private discussions with Harvard Management Co., which subsequently abstained from voting.

Equally alarming are signs of potential meddling in vote counts themselves. Another large Toshiba shareholder, 3D, discovered that the votes on about 5 million of its shares hadn’t been counted by Sumitomo Mitsui Trust, the shareholder services firm that administered the voting for Toshiba. At the same time, Toshiba engaged Goldman Sachs to defend it against activists – a likely costly engagement that will burn precious resources.

Neither Toshiba nor Farallon responded to emailed requests for comment from CorpGov while Effissimo didn’t answer multiple phone calls to its Singapore office.

Shareholder Return Since Mr. Kurumatani Become CEO in April 2018 – Bloomberg

Mr. Kurumatani struggles with a dicey 58% approval rate among shareholders. That’s partly due to questionable actions in 2020 such as Toshiba’s buyout of chip-equipment maker NuFlare Technology along with accounting irregularities at its Toshiba IT-Service unit.

Toshiba returned to the top section of the Tokyo Stock Exchange on Jan. 29, after more than three years in its second tier. The inclusion will require passive funds to buy an estimated 58 million shares, or 13% of outstanding stock. This could have been a moment to rejoice for activist shareholders. But instead, Mr. Kurumatani has many shareholders worried about big M&A.

Toshiba should focus on growing organically, shedding money-losing assets and finding a sturdier financial footing. That would be of more value to shareholders in the long term.

Toshiba’s share price indicates investors have little faith in current management’s ability to do the right thing. Toshiba trades at a multiple of 13.6 times forward earnings, according to Sentieo, an AI-enabled research platform. That’s among the lowest valuations in the company’s peer group, with Nidec Corp trading at 54 times, Tokyo Electron LTD at 24 times, and Sony at 23 times.

But even a P/E multiple is an overly flattering way to benchmark Toshiba. The company is sitting on net operating losses worth at least a couple billion dollars. That suggests the market values the core business considerably less than its $16 billion market capitalization.

Mr. Kurumatani’s tenure as CEO was supposed to restore confidence after years of mismanagement and scandals. Instead, he has generated little value for shareholders, with the stock going sideways until a very recent pop – likely due to the company restoring its status on the Tokyo Stock Exchange’s first section rather than any prudent decisions by Mr. Kurumatani.

As an outsider, Mr. Kurumatani has a genuine opportunity to effect positive change at Toshiba – perhaps even to guide the company back to its former glory. But if he cannot find a way to get along with shareholders, there may be some painful days ahead.

Contact:

editor@corpgov.com

www.CorpGov.com

Editor@CorpGov.com

Twitter: @CorpGovernor

CAPITALI$M WITH CHINESE CHARACTERISTICS

China Hedge Funds Add $200 Billion, Trouncing Wall Street

Bloomberg News

Sun, February 7, 2021



(Bloomberg) -- China’s army of tiny hedge funds are pulling further ahead of their better-known foreign competitors with outsized gains helping them attract more assets.

The nearly 15,000 funds offered by Chinese managers returned 30% on average last year, with the best-performers surging 10-fold, according to Shenzhen PaiPaiWang Investment & Management Co. That dwarfs the average 12% gain for hedge funds globally.

The out-performance is another impediment to global funds such as Bridgewater Associates and Two Sigma, which have struggled to make inroads into China’s 3.8 trillion yuan ($588 billion) hedge fund market since it was opened to foreign firms four years ago. Local funds added a record 1.3 trillion yuan in assets last year.


“Foreign players are handicapped in China,” said Yan Hong, director of the China Hedge Fund Research Center at the Shanghai Advanced Institute of Finance. While many global funds are “patient” given the potential riches of cracking the Chinese market, their persistently small size adds to regulatory constraints, “making it hard for them to distinguish themselves.”

China’s early economic recovery from the pandemic fueled rallies in stocks and commodities, lifting returns across all eight hedge fund strategies tracked by PaiPaiWang. Macro funds, which trade across asset classes, were the best-performer, returning an average 41%, compared to the global average of 10%.

Shenzhen Qianhai Jianhong Times Asset Management added leveraged bets on stocks seen to benefit from the pandemic, such as glove makers and office supply companies shortly after the outbreak, then later made early dives into consumer stocks and vaccine makers as growth started to stabilize, according to China Times. Its Jianhong Absolute Return No. 1 fund ended the year with a 831% return, the best among stock funds, according to PaiPaiWang.

Only three of the 32 foreign firms that have won a license to operate in China’s hedge fund market -- UBS Group AG, D.E. Shaw & Co. and Winton Group Ltd. -- have garnered more than 2 billion yuan at their onshore private fund businesses -- a key condition to be allowed to access the interbank bond market that’s crucial for bond and macro strategies, according to Yan.

Their small size also makes it harder to win distribution deals from banks, the biggest source of new clients, Yan said.

The lack of scale also hampers foreign funds’ access to markets such as over-the-counter options because they can’t meet Chinese brokerages’ requirements for assets under management, according to Fangda Partners.

Top Quants

Meantime, the number of local hedge fund firms with at least 10 billion yuan in assets more than doubled last year to 63, according to Licai.com. Growth is most impressive among quant funds, with the four biggest tripling assets last year, according to Chinafund.

“Money is increasingly gravitating toward the biggest players, with the top 10% soaking up most of the inflows,” said Liu Ke, head of research at Hengtian Wealth Management. “The trend is accelerating.”

While some foreign quant firms are attracting strong inflows with offshore products that invest in China, they are struggling to win recognition onshore as the under-performance of their fundamental-driven strategies last year further erodes the appeal of their already short track-records, according to Qiu Huiming, founder of Shanghai Minghong Investment Management Co.

“Although foreign managers have stronger name recognition globally, the past two years showed that Chinese quant players still have the edge so far,” he said.

Chinese quants also further honed their machine-learning skills, with such funds tracked by Howbuy Wealth Management Co. beating mainstream multi-factor strategies by 12 percentage points.

Minghong’s assets doubled last year to about 60 billion yuan, making it China’s largest quant fund. Its offshore market-neutral product, which also invests in China, returned 32% last year, beating the global average of 3.4%, according to Eurekahedge.

Still, “it’s not a game where success is determined in the short-term,” Yan said. “As policies loosen further, foreign players’ advantages could gradually emerge.”

(Updates with information about foreign funds in China)


©2021 Bloomberg L.P.

U.S. Treasury's Yellen: Americans earning $60,000 should get stimulus checks

Sun, February 7, 2021

U.S. President-elect Joe Biden announces members of his economic 

policy team in Wilmington, Delaware

WASHINGTON (Reuters) - U.S. Treasury Secretary Janet Yellen said on Sunday that American workers who earn $60,000 per year should receive stimulus checks as part of the White House's proposed $1.9 trillion coronavirus relief package.

"The exact details of how it should be targeted are to be determined, but struggling middle class families need help," Yellen said on CNN’s "State of the Union."

The White House has said it is open to negotiation on who should be eligible to receive the proposed $1,400 checks, and has declined to specify where it thinks the income cutoff should be.

"President (Joe) Biden is certainly willing to work with members of Congress to define what's fair and he wouldn't want to see a household making over $300,000 receive these payments,” Yellen said, without offering further detail.

If Congress approves the $1.9 trillion plan, the country would get back to full employment next year, Yellen said. Otherwise, she said, unemployment would linger for years.

Republicans on Capitol Hill have resisted the administration’s COVID-19 relief plan, concerned it would unnecessarily increase the national debt following the $4 trillion in aid Congress passed last year.

Speaking on the ABC News' program "This Week," Republican Senator Roger Wicker said he thought his party would be willing to support something in the $600 billion to $700 billion range.

Biden has said he would like to win bipartisan support for his plan, but that Republicans were falling far short of the mark in terms of what needs to be done. He said Democrats would go it alone if needed.

The president, Yellen and other administration officials have warned repeatedly that the danger to the economy would be going too small with stimulus efforts, not too large.

Last week, the House and Senate approved a budget plan that would allow a coronavirus relief bill to clear the Senate with a simple majority vote of 51.

Under normal rules, 60 votes would be needed. The Senate is split 50-50, with Vice President Kamala Harris representing the tie-breaking vote for Democrats.

Asked about the risk of over-stimulating the economy and generating inflation, Yellen said: "We have good tools to deal with that risk if it materializes."

(Reporting by Linda So; Editing by Tim Ahmann and Bill Berkrot)

Janet Yellen Re: Cryptocurrencies and Terrorists

Kelsey Williams
Sun, February 7, 2021


Here are the statements she made in response to a question from Sen. Maggie Hassan, who asked Yellen during her confirmation hearing on Tuesday about the dangers of terrorists using cryptocurrencies:

“You’re absolutely right that the technologies to accomplish this change over time, and we need to make sure that our methods for dealing with these matters, with terrorist financing, change along with changing technology,” Yellen said.

“Cryptocurrencies are a particular concern. I think many are used – at least in a transaction sense – mainly for illicit financing.

“And I think we really need to examine ways in which we can curtail their use and make sure that money laundering doesn’t occur through those channels.” 

ARE TERRORISTS USING BITCOIN?

Are terrorists using Bitcoin to finance their “illicit” activities? And, to what extent?

I understand the concern about money laundering, but it is doubtful that “many” cryptocurrencies are used “mainly for illicit financing”. If that is the case, then why is the Secretary of Treasury encouraging lawmakers and regulators to “curtail” their use?

To answer that, we need to understand what Bitcoin and other cryptocurrencies are – in simple, straightforward terms.

Cryptocurrencies offer a PRIVATE process for digital transfer of money. Every single transaction is recorded within a decentralized tracking system. The privacy is attractive for tax and regulatory reasons.

Is tax-avoidance an issue of concern for Ms. Yellen? In her role as Secretary of Treasury, the answer is probably yes. Although, at this point, the volume of financial transactions in all cryptocurrencies likely isn’t large enough to justify excessive concern on her part.

There must be another reason. There is; and that reason encompasses territory far beyond the potential loss of tax revenue.

MS. YELLEN’S REAL REASON FOR CONCERN

The reason: lack of control.

We live in a highly regulated society. Our financial system is the epitome of stringent regulation and control. That control is evident in the process involving financial transactions and the transfer of money.

The ever-present middleman in clearing all financial transactions is the bank; ultimately the US Federal Reserve. And, as we know, Ms. Yellen is a former board chair of the Federal Reserve.

Financial transactions in Bitcoin and other cryptocurrencies are “off the grid” so to speak. That means that they are unreported and do not come under the purview of the regulators.

However, it is not realistic to think that the system will be allowed to function unimpeded on its own for long. This is especially true if the dollar volume of transactions increases in significance.

Ms. Yellen’s inference of terrorists using cryptocurrencies appears to be an attempt to justify curtailment or clampdown on financial activity that is currently not under the purview of those who are in control.

It is naive and short-sighted to think that those who claim to have regulatory authority would sit idly by without making a concerted attempt to intervene in areas where activity is perceived as a threat to their own (the regulators) interests.

(also see Judy Shelton – Thank You; Janet Yellen – She’s Back)

Kelsey Williams is the author of two books: INFLATION, WHAT IT IS, WHAT IT ISN’T, AND WHO’S RESPONSIBLE FOR IT and ALL HAIL THE FED!

This article was originally posted on FX Empire