Regulators can’t touch Facebook—but the market can

Rick Newman
·Senior Columnist
Thu, 3 February 2022,

A lot of people want to punish Facebook (FB): For its domination of social media, its relentless data mining, its reluctance or maybe refusal to police disinformation. Politicians on both the left and the right would dismantle the social-media giant, if they could.

Facebook and its parent company, Meta, have been essentially impervious to such external pressure. Market forces, however, may now accomplish what legal authorities can’t: Punishing Facebook for a business model that relies heavily on the exploitation of users’ personal data.

Meta stock plunged by 27% on February 3, the biggest one-day drop since Facebook went public in 2012. The selloff followed a quarterly earnings disappointment, which, up till now, has been foreign to Facebook. But the real bombshell was the company’s acknowledgment that new efforts by Apple (AAPL) to protect user privacy made it harder for Facebook to target ads to those Apple customers, a new challenge that could cost Facebook more than $10 billion per year.

As Yahoo Finance’s Dan Howley explains, Apple launched a new privacy feature for its mobile devices last year that changed the way apps can track what users do with their iPhones and iPads. Before the change, apps such as Facebook could automatically track your activity, allowing them to know your likes and interests and target ads accordingly. Users could disable that feature on their devices, but most didn’t.

Apple has made privacy protection a distinguishing feature of its products, and the change means app tracking is now off by default on Apple’s newest operating system. If there’s anybody out there who really wants Facebook’s micro-targeted ads, they can change their settings so Facebook can track what they do. But an unstated part of Facebook’s entire business model is that it doesn’t ask permission to track and vacuum up data, because if it did, too many people would say no.

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Facebook and other app developers protested and even threatened legal action, but Apple stood firm. The net result has now shown up in Facebook’s bottom line: The company can’t target ads as effectively as it wants to the estimated 1 billion people worldwide who use an iPhone. That means companies that advertise on Facebook will get weaker results, lowering Facebook’s ad rates and driving some of them to advertise instead on Google or other platforms where they feel they can get more bang for the buck.

Advertising dynamo

Facebook has been a digital advertising dynamo for more than a decade, locking in gargantuan profits as an early mover in the race to monetize the personal information of its nearly 3 billion worldwide users, including those on Instagram, which Meta also owns. Facebook didn’t invent the model, but it perfected the strategy of offering users a free service in exchange for data that was worth a fortune when sliced and diced for advertising purposes.

Facebook CEO Mark Zuckerberg pauses while speaking as he testifies before a joint hearing of the Commerce and Judiciary Committees on Capitol Hill in Washington, Tuesday, April 10, 2018, about the use of Facebook data to target American voters in the 2016 election. (AP Photo/Alex Brandon)

The market has been shifting, however, and Meta CEO Mark Zuckerberg—who has stoutly rebuffed nearly every effort to rein in his company’s business model—may be losing his wizard’s touch. Facebook has endured a barrage of bad publicity since it became clear a low-budget Russian disinformation campaign used Facebook during the 2016 presidential campaign to smear Democrat Hillary Clinton, in an effort to help elect Republican Donald Trump. The Cambridge Analytica scandal revealed that Facebook violated its own rules on data dissemination to allow a research firm working for the 2016 Trump campaign to target political ads at users based on info that was supposed to remain private.

Democratic Sen. Elizabeth Warren and Republican Sen. Josh Hawley want to break up Facebook, as do many other lawmakers. The Federal Trade Commission and attorneys general from 48 states are pursuing legal action against Facebook, claiming it’s a monopoly that ought to be subject to antitrust measures. There have been numerous hearings during recent years where Zuckerberg and other senior Facebookers have parried with interrogators and insisted that no, Facebook is not evil.

The law has largely been on Facebook’s side. But public opinion no longer is, and that, in turn, is aligning market forces against Facebook for what may be the first time since Zuckerberg and some fellow geeks dreamed up the scheme at Harvard in the early 2000s. In the Interbrand global rankings, Facebook ranked No. 8 among global brands in 2017. That was its high-water mark. By 2021, Facebook had fallen to 15. That probably understates the company’s problem, however, since those types of rankings involve name-recognition as much as quality perception.

Consumers worldwide have become markedly more concerned about data privacy as they’ve become more aware of the ways companies gather information on them and use it to make money. Europe leads in privacy protection, but the United States may be catching up. A recent Morning Consult poll found that 56% of registered voters support a federal law that would prohibit social media companies from targeting ads based on personal data—which is the core of Facebook’s business model. Only 23% said they would oppose such a law, while 21% said they weren’t sure.

Private sector

Congress doesn’t seem likely to pass such a law any time soon, but this is where the private sector comes in. Apple has clearly caught on to the growing desire for privacy, to the point where it has even fought the US government by refusing to help unlock the iPhones of criminals and terrorists. Those were unpopular positions at the time, but Apple stuck to its principles and the tech giant now seems to be in pole position just as consumer concern on the issue is peaking. Android phones, powered by Google’s software, don’t yet have similar protections, but Google parent Alphabet could flip on the issue, much as Apple did.

Apple is the world’s biggest and most valuable company, and the kind of gargantuan foe even the king of social media can’t face down. Facebook will remain profitable and probably continue to agitate its many detractors. But the market is now disciplining Facebook, and Zuckerberg can’t blow that off the way he can a few dyspeptic senators. At least four research shops downgraded their outlook for Facebook following the Feb. 3 rout, including JPMorgan, BMO and Loup Ventures. More downgrades are probably coming.

Facebook changed its name to Meta last year to emphasize a pivot to the so-called metaverse, where people will supposedly live digital lives independent of what they do in the physical world. But the metabucks haven’t arrived yet, and Meta may now face a turbulent period of marginal decline in its legacy business while it tries to establish first-mover advantage in a different realm. It won’t have many sympathizers.

Rick Newman is a columnist and author of four books, including "Rebounders: How Winners Pivot from Setback to Success.” Follow him on Twitter: @rickjnewman. You can also send confidential tips.

Brian Flores lawsuit against the NFL: Belichick text messages ‘speak for themselves,’ lawyer says

Josh Schafer

·Producer

Fri, 4 February 2022

A lawyer who specializes in sports business law told Yahoo Finance Live that the lawsuit recently filed by former Miami Dolphins head coach Brian Flores provides sufficient evidence of racial bias in the New York Giants hiring process.

“I think the text messages truly do speak for themselves,” Darren Heitner, the founder of Heitner Legal, said on Yahoo Finance Live (video above). “I do wonder if this case will ever get past motion to dismiss and enter the discovery phase where potentially Bill Belichick would be deposed. I think what it shows … is that the Rooney Rule has really become a type of ‘check the box’ platform.”

In the 58-page document, Flores provides screenshots of a text message exchange allegedly between himself and New England Patriots Head Coach Bill Belichick.

The text exchange between Brian Flores and Bill Belichick.

The messages suggest that Belichick knew the Giants had decided on another candidate — Brian Daboll — prior to interviewing Flores. Flores alleges that text messages show how the Giants were only complying with an NFL mandate known as the Rooney Rule, which requires at least two head coach interviews with diverse candidates, by interviewing him.

“What sticks out the most is that there’s obviously a problem,” Heitner said. “The problem is that the Rooney Rule was put into place years ago to try to ameliorate the issue of not enough minority coaches being put in place. As we sit here today, only one Black head coach is coaching in the NFL.”

Flores filed the class-action lawsuit against the NFL and three teams — the Giants, the Dolphins, and the Denver Broncos — alleging racism in his firing from the Miami Dolphins and the league’s hiring practices.

Head coaches Brian Flores of the Miami Dolphins and David Culley of the Houston Texans talk during pregame at Hard Rock Stadium on November 07, 2021 in Miami Gardens, Florida. (Photo by Michael Reaves/Getty Images)

“The allegation that the Giants’ decision had been made prior to Friday evening, January 28, is false," the Giants said in a statement. "And to base that allegation on a text exchange with Bill Belichick in which he ultimately states that he 'thinks' Brian Daboll would get the job is irresponsible. The text exchange occurred the day before Coach Daboll’s in-person interview even took place."

Flores also alleged that his experience is not unique and is part of the larger diversity and representation issue in America’s largest professional sports league. Just one of the NFL’s 32 teams currently has a Black head coach while the league’s player pool is about 70% Black, according to statistics cited in the Flores lawsuit.

"The NFL and our clubs are deeply committed to ensuring equitable employment practices and continue to make progress in providing equitable opportunities throughout our organizations," the NFL said in a statement released Tuesday. "Diversity is core to everything we do, and there are few issues on which our clubs and our internal leadership team spend more time. We will defend against these claims, which are without merit."

PDF Brian Flores lawsuit agains... by David Fucillo

‘Going to be a very tough burden’

Flores had coached three seasons for the Dolphins, leading the franchise to consecutive winnings seasons for the first time since 2003 before the franchise fired him on January 10. The 40-year old coach started interviewing with teams later that month, when the alleged bias from the Giants in the hiring practice took place.

While Heitner believes Flores could have a case against the Giants, he’s not as confident in Flores’ evidence against the other teams accused. Flores is alleging that executives at the Dolphins gave up on the coach early in his tenure after he refused to lose games for a better draft pick and convince a “prominent quarterback” to sign with the Dolphins prior to free agency.

Both instances with the Dolphins are part of a league issue surrounding tanking and tampering and are being investigated by the NFL, per multiple reports, and might not be seen as “racial,” per Heitner.

The case against the Broncos centers around a 2019 job interview when Flores claims team executives arrived an hour late to the meeting and appeared disheveled. The lawsuit alleges it was “obvious they had been drinking heavily the night before.”

“It’s going to be a very tough burden for them to prove either the Dolphins or the Broncos committed some sort of racial backlash based on the fact he didn’t end up getting the job with the Broncos and then was ultimately terminated by the Dolphins,” Heitner said.

CINCINNATI, OHIO - AUGUST 29: Brian Flores the head coach of the Miami Dolphins against the Cincinnati Bengals at Paul Brown Stadium on August 29, 2021 in Cincinnati, Ohio. (Photo by Andy Lyons/Getty Images)

Yahoo Sports reported that former Cleveland Browns coach Hue Jackson may join Flores’ class action suit, but Heitner posited that the case isn’t likely to be certified as a class action lawsuit because Flores’ experiences are too personally specific.

Patrick Rishe, sports business director at Washington University in St. Louis’ sports business program director, agreed but noted that the lawsuit’s impact on how race issues in the NFL are viewed by the broader public could be the most significant outcome from the lawsuit.

“There's no question that the high profile nature of this Brian Flores lawsuit is going to be an eye opener,” Rishe said. “Not just within the NFL, not just within professional sports, but across all of human resource decision making in America. There are going to be companies and leaders that need to recognize and be aware of this.”

Josh is a producer for Yahoo Finance.

Read the latest financial and business news from Yahoo Finance

Skiing is not going to exist' – global warming threatens future of winter sports, warns former Olympian Vonn

Brent Sanchez

Thu, 3 February 2022

The Austrian glaciers where Lindsey Vonn honed her craft are essentially gone. The slopes she grew up speeding down have melted away.

Now a few years removed from her decorated alpine skiing career, the Olympic gold medalist is sounding the alarm on the impact of climate change for the next generation of downhillers.

“Skiing is not going to exist, winter sports are not going to exist if we continue down this path,” Vonn told Yahoo Finance. “We see it firsthand.”

For the first time in Winter Olympics history, athletes will be competing on 100 percent man-made snow.

It’s not surprising since it never snows much in and around Beijing.

But, because of climate change, even places that once were buried in snow are struggling to keep the slopes covered.

New research led by University of Waterloo climate experts shows that without a dramatic reduction in greenhouse gas emissions, many former Olympic sites would no longer be viable hosts in just a few decades time.

“You can't deny that global warming exists and that the world is changing, and that we have to make the change in a huge way,” Vonn said. “But to many it’s not quite as apparent, so I’m not sure how we can make a change substantial enough to fix what's happening.”

Activists like Mustafa Santiago Ali have spent their entire careers fighting to raise awareness about climate change and stave off its devastating effects.

“Every aspect of society will be impacted by climate change,” said Santiago Ali, who currently serves as Vice President of Environment Justice, Climate and Community Revitalization for the National Wildlife Federation. “The good point is that we can actually make change happen and begin to mitigate many of those impacts.”

Ali is encouraged by the pledges from the Biden administration to curb emissions and heavily invest in efforts to mitigate global warming. And, as a grassroots activist, he believes in the power of the average citizen to make meaningful change — before it’s too late.

“We have a lot of work to do, and time is ticking.”

AOC calls America's surging education costs a 'moral hazard'

Ben Werschkul

·Senior Producer and Writer

Tue, 1 February 2022,

Just before Christmas, President Joe Biden extended a student loan moratorium that's allowing millions of Americans to temporarily stop making student loan payments without accruing interest.

In a new interview with Yahoo Finance, progressive Congresswoman Alexandria Ocasio-Cortez said that Biden could endanger the country if he doesn't make the reprieve permanent before it expires on May 1.

“I cannot understate the danger and the risk — economically, politically, and just where we are right now as a country — of allowing the moratorium on student loan payments to lapse in May,” she said in an interview for Influencers with Andy Serwer releasing this week.

While Biden used student loan forgiveness as a talking point on the campaign trail, he's put off taking that step in office by repeatedly extending the freeze on public student loan repayments that began under then-President Donald Trump. Borrowers with private student loans haven't had that reprieve; they have had to continue paying those loans during the pandemic.

Speaking to Yahoo Finance, Ocasio-Cortez suggested that forcing millions of borrowers to start taking on student debt payments could not only threaten the recovery, but would also be unethical in light of the economic hardships a generation of young student debtors already faces.

Rep. Alexandria Ocasio-Cortez (D-NY) during a House Financial Services Committee hearing on student debt in 2019. She made a payment on her personal debt in the middle of the hearing to highlight the issue. (REUTERS/Jonathan Ernst)

"We are at such a delicate point in the financial and just general economic recovery post-COVID that to then re-start payments that are essentially the size of a mortgage payment, sometimes even larger, on a generation that was already so devastated ... It could throw out of balance already what is a very fragile recovery," she said.

Not to mention, Ocasio-Cortez added, "Forgiveness ... it's the right thing to do."

‘Prepare for payments to resume’

During the 2020 campaign, Biden promised to forgive $10,000 in federal student loans per person. While he has not made good on that promise yet, his administration canceled debt for certain borrowers including those who were defrauded by a for-profit college chain. Some Democrats including Ocasio-Cortez, Sen. Chuck Schumer (D-NY), and Sen. Elizabeth Warren (D-MA) want him to go further and forgive up to $50,000 in student loans per person.

During a Yahoo Finance live interview last week, Biden economic adviser Jared Bernstein characterized student debt negotiations in the White House as “a very intense, ongoing process."

The White House has asked Congress for legislation to address surging student debt in the U.S., but negotiations have gone nowhere in the deeply divided Senate. Consequently, the administration is publicly urging borrowers to “prepare for payments to resume” in May.

Some moderate to conservative voices have urged the administration to “wind down” the moratorium. “It's time that we get back to a new normal, where people who owe student loans are beginning to repay again,” Shai Akabas, the director of economic policy at the Bipartisan Policy Center, told Yahoo Finance in December.

‘I don't think it's a legitimate argument’

While student debt has become a hotly debated topic during the pandemic, Ocasio-Cortez is quick to point out that borrowers were defaulting even before COVID-19. The U.S. government holds over $1.61 trillion in loans among approximately 43.4 million borrowers, working out to an average federal student loan balance of $37,113, according to a recently updated report from the Education Data Initiative.

Ocasio-Cortez rejects the notion that a president might not have the authority to eliminate the debt outright. “I don't think it's a legitimate argument,” she said of those who have raised that question, including White House Chief of Staff Ron Klain.

Protesters in 2021 put up a sign in front of The White House to call on President Joe Biden to sign an executive order to cancel student debt. (Paul Morigi/Getty Images)

Ocasio-Cortez joined a group of progressive lawmakers last week including Sen. Warren in urging the administration to clarify that it does have the authority to cancel student debt. They're asking the administration to release a memo “outlining your legal authority to broadly cancel federal student loan debt and immediately cancel up to $50,000 of student loan debt per borrower.”

If the Biden administration can legally pause student debt payments, Ocasio-Cortez reasons, it must have the authority to cancel them. In Congress, she would go even further. She touts her sponsorship of the Student Debt Cancellation Act, aimed at eliminating both federal and private student loans for all former and current students.

“The true moral hazard here is the surging costs of education in the United States," she said.

Ben Werschkul is a writer and producer for Yahoo Finance in Washington, DC.

AOC: Capitalism 'is the absolute pursuit of profit' at all costs

Erin Fuchs
·Deputy Managing Editor
Thu, 3 February 2022

In his annual letter to CEOs this year, BlackRock CEO Larry Fink urged other chief executives to harness the "power of capitalism" to influence society and serve as a catalyst for positive change.

Progressive Congresswoman Alexandria Ocasio-Cortez, a democratic socialist, has a very different view on the nature of capitalism. In a new interview with Yahoo Finance taped on Jan. 27, Ocasio-Cortez suggested that people often have different definitions of terms like socialism or capitalism.

"When we toss out these big words, capitalism, socialism, they get ... sensationalized, and people translate them into meaning things that perhaps they don't mean," she told Yahoo Finance's editor-in-chief, Andy Serwer. "So to me, capitalism, at its core, what we're talking about when we talk about that is the absolute pursuit of profit at all human, environmental, and social cost."

Ocasio-Cortez, widely known as AOC, has attacked this notion of capitalism frequently since she beat longtime incumbent Joseph Crowley, the No. 4 House Democrat, in 2018 to represent a New York district covering parts of the Bronx and Queens. She is one of four democratic socialists in Congress, along with Cori Bush of Missouri, fellow New Yorker Jamaal Bowman, and Rashida Tlaib of Michigan.

The Democratic Socialists of America defines this system as "one where ordinary people have a real voice in our workplaces, neighborhoods, and society." For her part, Ocasio-Cortez envisions a "more just economy" as one where workers have more power — as they do in unionized workplaces or in worker cooperatives that workers collectively own and operate.

WASHINGTON, DC - AUGUST 03: U.S. Rep. Alexandria Ocasio-Cortez (D-NY) (L) stands with Rep. Cori Bush (D-MO) during a news conference on the eviction moratorium at the Capitol on August 03, 2021 in Washington, DC. (Photo by Kevin Dietsch/Getty Images)

"You know, we're here in the Bronx," she said during her interview with Yahoo Finance, which was filmed in that borough. "I represent a community that has the largest concentration of worker cooperatives in ... one of the largest concentrations in the world."

One worker cooperative in the Bronx, an employee-owned home care agency called Cooperative Home Care Associates, describes itself as the largest worker cooperative in the U.S., employing roughly 2,000 Black and Latinx workers.

"Now these are alternative ways of doing business," Ocasio-Cortez told Yahoo Finance. "Free markets are not the same thing as capitalism."

AOC has pointed to her own online store — which sells merchandise like "Tax the Rich" T-shirts — as a different way of doing business. When former White House press secretary Sean Spicer accused her of "using capitalism to push socialism" in a tweet, she tweeted back the same definition of capitalism that she used with Yahoo Finance.

VIDEO: AOC: Capitalism 'is the absolute pursuit of profit' at all costs 

"Not sure if you know this Sean, but transactions aren't capitalism," she wrote. "...but fwiw, our shop is unionized, doesn't operate for profit, & funds projects like free tutoring, food programs, & local organizing."

Speaking to Yahoo Finance, Ocasio-Cortez described American billionaires as the epitome of capitalism.

"What we're also discussing is the ability for a very small group of actual capitalists, and that is, people who have so much money that their money makes money, and they don't have to work," she said. "They can control industry, they can control our energy sources, they can control our labor ...They can essentially have power over the many. And to me, that is not a redeemable system."

Erin Fuchs is deputy managing editor at Yahoo Finance.

AOC: Facebook ‘sabotaged’ the global COVID response with disinformation

Max Zahn with Andy Serwer

Thu, 3 February 2022, 

Progressive Congresswoman Alexandria Ocasio-Cortez (D-NY) told Yahoo Finance in an exclusive interview that Facebook (FB) and other U.S. companies have "sabotaged" the global response to COVID-19 by spreading disinformation about the virus.

The tech giant, which recently changed its name to Meta, should "be broken up" because it exploits its overlapping lines of business as a platform, vendor, and advertiser, Ocasio-Cortez added in the wide-ranging remarks.

"There are some things that the United States provides that are welcome," she says.

"There are also things that we want the United States to stop exporting and one of those things is disinformation — disinformation through U.S.-founded companies like Facebook that have absolutely slowed and frankly sabotaged the global effort to fight against the coronavirus," she adds.

The comments from Ocasio-Cortez, who spoke to Yahoo Finance's editor-in-chief, Andy Serwer, on Jan. 27, came nearly a month after Facebook suspended House Rep. Marjorie Taylor Greene (R-GA) for 24 hours for spreading misinformation about COVID-19. Facebook imposed the suspension a day after Twitter banned Greene permanently.

Facebook has drawn criticism throughout the pandemic for what some perceive as an inadequate effort to prevent the spread of false information about the virus. The company did not immediately respond to a request for comment.

President Joe Biden set off a public back-and-forth with Facebook last July when he asserted that social media platforms are "killing people" through the spread of vaccine misinformation.

In response, Facebook VP Guy Rosen refuted the accusation, arguing in a blog post that vaccine acceptance among Facebook users had increased since the previous January and advocating instead for a "whole of society" approach to ending the pandemic.

In later comments on the subject, Biden softened his criticism by directing his ire toward the top influencers who spread vaccine misinformation on social media, rather than the platforms themselves.

But documents later disclosed by whistleblower Frances Haugen revealed that the company had gathered deep information about the spread of coronavirus misinformation on its platform, which the company did not share publicly, the Washington Post reported in October.

Facebook spokesperson Aaron Simpson provided this statement to the Post: “There’s no silver bullet to fighting misinformation, which is why we take a comprehensive approach which includes removing more than 20 million pieces of content that break our covid misinformation policies … connecting more than 2 billion people to reliable information about covid-19 and vaccines, and partnering with independent fact-checkers."

Rep. Alexandria Ocasio-Cortez, D-N.Y., listens during a House Financial Services Committee hearing with leaders of major banks, Wednesday, April 10, 2019, on Capitol Hill in Washington. (AP Photo/Patrick Semansky)

Only 12 people are responsible for up to 73% of anti-vaccine misinformation on Facebook, according to a report released in March 2021 by advocacy group Center for Countering Digital Hate.

Joseph Mercola, a top anti-vaccine influencer with 1.7 million followers on the platform, frequently posts messages skeptical of vaccines and uses his Facebook page to promote his anti-vaccine book "The Truth About COVID-19."

Ocasio-Cortez rose to prominence in June 2018 with a surprise upset of incumbent Rep. Joseph Crowley, then the No. 4 Democrat in the House and a potential successor to Speaker Nancy Pelosi. When she took office the following year at the age of 29, she became the youngest woman ever to serve in Congress.

She has amassed nearly 13 million Twitter followers, giving her one of the largest online platforms of a U.S. elected official.

Speaking to Yahoo Finance, Ocasio-Cortez reiterated her longstanding call for antitrust action against Facebook. Last month, a judge rejected Facebook's request to dismiss an antitrust lawsuit brought by the Federal Trade Commission that claims the company is operating a monopoly in the social media sector.

"Facebook should be broken up," Ocasio-Cortez says. "They're an advertiser. They are acting as both platform and vendor. They are a communication platform, which has historically been a well established domain of antitrust."

"Because they are so many businesses and industries in one," she adds. "The case [is] right there in and of itself as to why they should be subject to antitrust activity."

Read more:

• What Alexandria Ocasio-Cortez wants in the next Supreme Court nominee

CRIMINAL CRYPTO CAPITALI$M

NFTs suffer 'some' money laundering, manipulative flows that inflate prices

David Hollerith

·Senior Reporter

Thu, 3 February 2022, 

Non-fungible tokens have seen a "significant" rise manipulative practices that exaggerate prices, liquidity and launder money, according to new data — a growing fear as the sector turns increasingly volatile.

A report released Wednesday from blockchain analytics platform, Chainalysis, found “significant wash trading and some money laundering" does occur, with at least part of those questionable flows running through ultra-hot NFTs, a sub-sector of the growing cryptocurrency market.

Chainalysis data comes as Open Sea, the largest marketplace for buying and selling NFTs, had its best month yet in January with $4.9 billion in transaction volume, raising at least a few questions regarding exactly how much of the overall market is legitimate.

Many observers of the crypto market have been quick to suggest and even point out that the market is plagued by price manipulative practices such as wash trading, a practice in which traders take both sides of a sale to inflate its value.

Wash trading and money laundering are proving “extremely easy to trace on the blockchain” according to the firm’s director of research, Kim Grauer.

A surge in NFT transactions, mirroring the rise of cryptocurrency's popularity

Wash trading often boosts an asset's demand and underlying price, and is being increasingly cited in some NFT transactions. The practice can be pervasive in the crypto markets, which involve wallet addresses that can be created pseudonymously for free, with little effort.

While wash trading is illegal for conventional securities and futures instruments, it's not been actively enforced within the budding NFT movement. Sometimes, it is literally programmed into a platform's reward model.

Last month, Decrypt reported that a newer Ethereum (ETH-USD)-based NFT platform, LooksRare, saw a massive upswing in trading volume thanks to wash trading. That included a Meebits NFT sold for a jaw-dropping $100 million worth of trading volume in just two transactions.

Yet the data presented by Chainalysis shows that the practice is sometimes not even worth the effort.

“We found that by and large, [wash trading] really is not an attractive thing to do in the NFT space,” Grauer told Yahoo Finance.

Apart from how easily was trading can be traced, Grauer pointed to the high transaction costs (i.e. Ethereum gas fees) for trading NFTs.

Looking at a sample of buyers and sellers across multiple NFT marketplaces, the study tracked the profitability of 252 traders who they assumed with a high degree of confidence could be classified as habitual wash traders.

Each of these traders conducted NFT transactions at least 25 times between self-financing wallet addresses, meaning those funded by the sellers address or the address that funded the selling address. Of those habitual washers, the study found that only 110 profited, while the other 152 lost money. However, profitable wash traders still made out very well.

According to the report, the 110 profitable wash traders collectively made nearly $8.9 million, which dwarfed the $416,984 in losses made by the other 152 habitual wash traders.

“We don’t see wash trading as an effective or reliable way for criminals to make money because of both the cost spent on gas, the traceability, and the risk of no payout unless someone takes the bait,” Grauer added.

As Yahoo Finance has previously reported, money laundering in crypto assets is far easier to track than in government issued fiat currencies. The study found that the value in cryptocurrencies sent to NFT marketplaces from illicit wallet addresses reached $1.4 million in 2021.

Crime will likely rise as more investors show interest in NFTs. However, those sums are relatively small: Chainalysis previously found that $8.6 billion of illicit funds were laundered in on a total $44.2 billion worth of money that went to NFT marketplaces during the same period.

CRIMINAL CAPITALI$M INSIDER TRADING

'Too many members of the Senate trade in stocks,' Senate Banking Committee chair says

Adriana Belmonte
·Senior Editor
Sat, 5 February 2022

The push for stricter regulation related to members of Congress trading individual stocks has been picking up momentum in 2022.

There are currently at least half a dozen bills that have been proposed in recent months to address the issue, which one senator said has gotten out of hand.

“Too many members of the Senate trade in stocks, and their spouses do,” Sen. Sherrod Brown (D-OH), the chair of the Senate Banking Committee, said on Yahoo Finance Live (video above). “I don’t accuse anybody individually of a conflict of interest and in betraying the public interest. But the temptation — if you own shares of stock, everything looks like a conflict of interest because we vote on everything in the Senate. We vote on banking rules. We vote on environmental rules. We vote on labor rules. We vote on minimum wages sometimes, so there are all kinds of conflicts.”

Sen. Sherrod Brown speaks during a Senate Banking Committee confirmation hearing on January 13, 2022. (Photo By Tom Williams/CQ-Roll Call, Inc via Getty Images)

Under the STOCK Act of 2012, lawmakers are required to report their stock trades within 45 days of the transactions. However, a report by Insider found that 54 members of Congress have failed to properly report their transactions.

“We need to write the strongest bill that we can get a majority of senators on,” Brown said. “It will be a challenge because a number of senators, especially Republicans, have complained about this. And there are a lot of people in the Senate that hold a lot of investments, and I’m concerned.”
'You're here for public service'

Several senators have come under scrutiny for insider trading practices since the pandemic first hit the U.S. In March 2020, the Justice Department announced that it would be investigating some senators to determine whether they traded ahead of the stock market crash triggered by the coronavirus pandemic.

An investigation by ProPublica and The Center for Responsive Politics revealed that Sen. Richard Burr (R-NC), who was chairman of the Senate Intelligence Committee at the time and received confidential briefings about the emerging threat of the coronavirus pandemic, and his wife sold numerous stock shares following those briefings.

Burr denied the allegations, and the Department of Justice ended its inquiry into his trading actions in January 2021, though the Securities and Exchanges Commission (SEC) is reportedly still investigating.

Senator Richard Burr delivers opening remarks during a Senate Health Committee hearing to examine the federal response to COVID, January 11, 2022. Shawn Thew/Pool via REUTERS

Kelly Loeffler (R-GA), who was a member of the Senate Health Committee, reportedly sold stock on January 24, 2020, which was the same day the committee was briefed by administration officials on the coronavirus.

Sens. Dianne Feinstein (D-CA) and Jim Inhofe (R-OK) were also scrutinized for their stock moves.

“You’re here for public service, not here to enrich your portfolio,” Brown said. “If you want to make more money, stay out of it. Don’t run for the Senate. Do something else. We have a public trust here.”

House Speaker Nancy Pelosi (D-CA) has been a vocal opponent of banning members of Congress from participating in the stock market. Her husband, Paul, is an active stock trader, according to reports.

"We are a free-market economy,” she said during a press conference in December, adding that lawmakers “should be able to participate in that."

Speaker of the House Nancy Pelosi arrives with her husband Paul Pelosi during the inauguration of Joe Biden as the 46th President of the United States in Washington DC on January 20, 2021. (Photo by JONATHAN ERNST/POOL/AFP via Getty Images)

Twenty seven lawmakers recently wrote a letter urging House leaders to act quickly to bring "commonsense, bipartisan" legislation to the floor banning members of Congress from owning or trading stocks.

In an interview with Yahoo Finance, progressive Congresswoman Alexandria Ocasio-Cortez (D-NY) detailed the fundamental issue as she sees it.

"I am a member of Congress: Members of Congress have access to very sensitive security clearances," Ocasio-Cortez said. "We have access to very detailed, tailored briefs. We, our job is to try to anticipate and legislate for what we see is coming. And we should not have the ability to both have access to that information and be able to hold and trade individual stock."
'They were doing stock trading'

Members of Congress from both political parties have proposed legislation to limit stock trading among their colleagues.

A proposal from Sens. Jon Ossoff (D-GA) and Mark Kelly (D-AZ) would prohibit members of Congress and their immediate family members from conducting any stock transactions while serving in office and confiscate the lawmaker’s entire salary if they break the rules. U.S. Representatives Abigail Spanberger (D-VA) and Chip Roy (R-TX) unveiled a similar proposal to be passed in the House.

Sen. Jon Ossoff questions Treasury Secretary Yellen and Fed Chairman Powell during a Senate Banking Committee hearing on the CARES Act September 28, 2021. Kevin Dietsch/REUTERS

Republican Senator Josh Hawley has also proposed a bill that would prohibit lawmakers and their spouses from owning or trading individual stocks.

Amid these discussions, however, Brown stressed: “Don’t forget about the Federal Reserve.”

Last October, Brown co-sponsored a bill — the Ban Conflicted Trading at the Fed Act — that would prohibit officials at the Federal Reserve from trading individual stocks. This came as a result of ethics concerns surrounding stock trades made by former Dallas Fed President Robert Kaplan and Boston Fed President Eric Rosengren, who both left their roles after scrutiny increased on the Fed.

“We know about some compromise, if you will,” Brown said. “We’ve had Fed presidents around the country — a couple resigned probably because of this. They were doing stock trading.”

In January, Federal Reserve Vice Chair Richard Clarida resigned earlier than initially planned after it was revealed that he had failed to properly disclose his trading activities in 2020, raising the question of whether or not he benefited from Fed actions.

Brown said he would be meeting with fellow lawmakers to “get something significant through the Senate.”

“It won’t be exactly the bill the way that I introduce it or Senator Ossoff or Senator Merkley,” he said. “But we need to move and we need to include the Federal Reserve in it. We need to include — not all family members, not grown children — but we need to include spouses in these rules.”

Adriana Belmonte is a reporter and editor covering politics and health care policy for Yahoo Finance. You can follow her on Twitter @adrianambells and reach her at adriana@yahoofinance.com

AOC: 'No mystery' why it's hard to ban lawmaker stock trading

Erin Fuchs

·Deputy Managing Editor

Thu, 3 February 2022

Last week, 27 lawmakers wrote a letter urging leaders of the U.S. House of Representatives to act quickly to bring "commonsense, bipartisan" legislation to the floor banning members of Congress from owning or trading stocks.

That letter called lawmakers' stock trading a "glaring problem" that won't go away until Congress fixes it. While federal lawmakers have unveiled a range of bills aiming to stop lawmakers' from trading stocks, the legislation may face opposition from lawmakers engaged in the behavior it's trying to rein in.

In a new interview with Yahoo Finance taped on Jan. 27, progressive Congresswoman Alexandria Ocasio-Cortez (D-NY) alluded to the difficulty of persuading members of Congress to police their own behavior.

"It's not really a mystery to me why it's difficult to pass," Ocasio-Cortez, widely known as AOC, told Yahoo Finance's editor-in-chief, Andy Serwer, in a wide-ranging interview. "I wouldn't be surprised if it was a majority of members of Congress who hold and trade individual stock."

The practice of so-called insider trading in Congress has faced widespread criticism in recent years because lawmakers have access to non-public information. Perhaps most notoriously, the Justice Department investigated four senators who sold significant amounts of stock in January and February 2020 as they were being briefed on the looming threat of COVID-19.

U.S. Representative Alexandria Ocasio-Cortez (AOC) attends the UN Climate Change Conference (COP26) in Glasgow, Scotland, Britain, November 9, 2021. REUTERS/Phil Noble

While those senators didn't face criminal charges, the investigation highlighted the reality that Congress often has access to inside information that could have a material effect on public companies.

"I am a member of Congress: Members of Congress have access to very sensitive security clearances," Ocasio-Cortez told Yahoo Finance. "We have access to very detailed, tailored briefs. We, our job is to try to anticipate and legislate for what we see is coming. And we should not have the ability to both have access to that information and be able to hold and trade individual stock."

While House members can trade stock freely, a 2012 law called the Stop Trading on Congressional Knowledge (STOCK) Act bans them from trading on "material, nonpublic information" and requires them to disclose trades within 45 days. More than a few lawmakers have violated the STOCK Act, though: A recent investigation by Insider identified 54 lawmakers who failed to comply with the law's reporting requirements.

And in 2020, 75 federal lawmakers held stock in Moderna (MRNA), Pfizer (PFE), or Johnson & Johnson (JNJ) as Congress authorized billions to develop and distribute COVID-19 vaccines made by these very companies, Insider also reported.

One bill recently introduced to further curb insider trading in Congress would aim to strengthen the STOCK Act's disclosure rules. Meanwhile, a bill introduced last month by Democratic Senators Mark Kelly of Arizona and Jon Ossoff of Georgia would prohibit lawmakers and their immediate family members from owning or trading stocks.

For her part, Ocasio-Cortez favors banning trading altogether, though she stresses that wouldn't prevent Congress members from having a broader stake in the stock market. "The key here, is that it's not to say that you can't have a retirement account or a college savings account ... a blind trust ... a mutual fund, an index fund," she said. "These are vehicles of investments that are broad, that individual members of Congress don't have direct control over."

Erin Fuchs is deputy managing editor at Yahoo Finance.

BACK TO WHERE IT BEGAN

Suds in the sanctuary: breweries populate vacant US churches

KATHRYN POST
Fri, February 4, 2022



This photo provided by Adam Martinez shows inside The Lost Abbey in San Diego. The Lost Abbey brewing company opened a new location in December 2021 inside the shell of a Mexican Presbyterian church built in 1906. The brewery added pews, chandeliers, tapestries and even stained-glass windows to accentuate its slightly irreverent brand. (Courtesy of The Lost Abbey via AP)

(RNS) — Bruce Lindsay never expected to own a church. But when his mother died shortly before the pandemic, he wanted to use his inheritance to do something extraordinary.

“My mother, if she were alive today, I think would have a great chuckle at what I’ve purchased,” said Lindsay. “I found myself surrounded by a church when it was the last place on earth I wanted to go to as a kid.”

In August, after purchasing a 900-square-foot-Methodist church built in 1876, Lindsay and his business partner, Anna Cronin, opened Dirt Church Brewing Co. in East Haven, Vermont. It’s one of at least eight church breweries that have opened in the U.S. since 2020.

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This content is written and produced by Religion News Service and distributed by The Associated Press. RNS and AP partner on some religion news content. RNS is solely responsible for this story.

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Today, the U.S. has roughly 30 breweries based in once-vacant churches. Though some church breweries have faced pushback for offering suds in a once sacred space, the move has precedent. Monks have been brewing beer in monasteries for centuries, offering it to visitors and often imbibing it themselves at a time when it was safer to drink beer than water.

Dirt Church Brewing Co. originally intended to open a brewery inside the church, but Cronin and Lindsay found it lacked running water, a septic tank and heat. Rather than tearing open the building to add the required services, they built the taproom next door, where the town’s former meetinghouse once stood. The church, now used as an art gallery and event space, remains integral to the brewery’s identity.

The name “dirt church” is both a nod to the 19th-century building as well as lingo used by the cycling community that Lindsay and Cronin belong to. “It’s kind of our little cheeky nickname for the Sunday morning long ride that was usually on mountain bikes or gravel bikes,” said Cronin. “Instead of going to ‘church-church,’ we would say, ‘Hey, are you going to dirt church?’”

Today, the brewery hosts “dirt church” for its patrons once a month via Sunday bike rides, runs or hikes — followed by a few celebratory beers at the taproom, of course.

Across the country in San Diego, The Lost Abbey brewing company opened a new location in December inside the shell of a Mexican Presbyterian church built in 1906. The brewery added pews, chandeliers, tapestries and even stained-glass windows to accentuate its slightly irreverent brand.

“This building fell into massive disrepair and probably would have been demolished were it not for the developers that saved it,” said Tomme Arthur, co-founder of The Lost Abbey. This is the brewery’s first location in a former house of worship.

The Lost Abbey was founded in 2006 to offer beers inspired by Belgian monastic brewing traditions, as well as some “nondenominational” beers brewed in no particular style. Per the company’s slogan, it offers brews to “sinners and saints alike” — a motto it’s embraced wholeheartedly.

The new location, appropriately dubbed “The Church,” is split into two sides, one for sinners and one for saints. The sections are marked by corresponding décor: A St. Peter statue presides over the saints area, and Mary Magdalene — who is often misidentified as a prostitute — occupies the sinners side.

The Lost Abbey’s beers play off of similar tropes, with “saintly” names such as “10 Commandments” or “Gift of the Magi” juxtaposed with names like “Judgment Day” or “Serpent’s Stout.” The next addition will be a beer featuring Baby Moses, a wink at the popular “Mandalorian” character Baby Yoda.

“We’ve always taken our beers more seriously than a lot of other things,” said Arthur, who grew up attending Catholic school. “What’s great is that every time that we need some sort of inspiration, we’re able to open up the Bible.”

The Ministry of Brewing, located in what was once St. Michael the Archangel Church in Baltimore, makes it a point to avoid religious themes in its marketing.

“All of our names of our beers are typically Baltimore references or something about the neighborhood,” said Jon Holley, the brewery’s general manager. “As far as religious terms, imagery, things like that, we already know that being in a church is a sensitive thing for a lot of people, so we’re not trying to touch that at all.”

The church was built in 1857 and was home to a German Catholic congregation and, later, a Spanish-speaking congregation before closing due to the cost of upkeep. In 2018, the Ministry of Brewing began a full renovation to preserve and restore many of the original elements of the building, which is on the National Register of Historic Places.

The church reopened to the public as a brewery in January 2020, featuring a dazzling interior with soaring columns and a mural-painted barrel ceiling. The brewery also hosts events, fundraisers and even local delegate debates.

Though Holley said he “half expected” pushback for residing in a historic church, the brewery has received overwhelming support. Most often, he said, patrons can be found enjoying the brewery’s bestselling hazy pale ale called “Wispy,” a reference to wispy stained glass.

Like the other two breweries, Dirt Church Brewing Co. in Vermont is intentional about its beer names. Its flagship beer? It’s named “Rejoice,” after Lindsay’s mother, Joyce.

“It’s our most popular beer,” said Lindsay. “Without my mother’s help, none of this would exist today.”

Record heat, forest fires in Colombia's Amazon in January

Fri, 4 February 2022,

The report said the month of January recorded the 'highest

 hot spot values in the last 10 years' in the Colombian Amazon 

(AFP/Luis ROBAYO) 

January of this year was the hottest month in the Colombian Amazon in a decade, leading to an increase in forest fires in the southeastern region and very likely impacting air quality in the capital Bogota, according to an Environment Ministry report seen by AFP Friday.

It said the month of January recorded the "highest hot spot values in the last 10 years" in the Colombian Amazon.

The phenomenon occurs, the ministry said, when the country goes through a season of low rainfall, and is due to human activity, of which "the most important is associated with deforestation fronts."

At least 80 percent of the "hot spots" were forest fires, a ministry spokesman told AFP. At the end of January, the ministry identified more than 3,300 "hot spots" in the six departments that make up the Colombian Amazon, including 1,300 in the Guaviare region alone.

According to testimony collected by AFP in October in the region, peasants and landowners take advantage of the dry season, from January to April, to burn or cut down trees and plant coca plants in their place, or to let cattle graze there.

The Serrania del Chiribiquete National Park, listed as a UNESCO World Heritage Site, is particularly threatened, as is the Nukak National Nature Reserve, a vast territory of jungle inhabited by the last nomadic indigenous people of Colombia.

The Foundation for Conservation and Sustainable Development (FCDS), which keeps its own count and regularly flies over the areas concerned, recorded at least 938 forest fires, the highest monthly January figure since 2012.

"Thousands of hectares of Amazon jungle, cut in recent months, are on fire today. These massive fires are now being felt as far away as Bogota," FCDS director Rodrigo Botero warned on Twitter.

"There are public health decisions to be made quickly. What are the air indicators saying in Bogota?"

Bogota mayor Claudia Lopez decried "the inability" of the government "to control the territory and guarantee security."

She described the fires as "arson attacks ... which, due to the direction of the wind, end up arriving and deteriorating the quality of the air" in the capital, almost 500 km away.

In Medellin, the country's second most populous city, officials have warned of a deterioration in air quality to a level "harmful to the health" of children and the elderly.

According to data from the Colombian government, deforestation has exploded in recent years in the country's Amazonian regions, notably as a result of the historic peace deal signed in 2016 with the Marxist guerrillas of the FARC, which then abandoned large swaths of territory which they previously controlled.

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