CRIMINAL CRYPTO CAPITALI$M
NFT insider trading scheme charges are a 1st, feds say

Yesterday 

NEW YORK (AP) — A former product manager at an online marketplace was arrested Wednesday in what federal authorities called the first ever digital asset insider trading scheme involving NFTs.

Nathaniel Chastain, a former employee of a company that does business as OpenSea, was arrested in Manhattan. He was later released on $100,000 bail after entering a not guilty plea to wire fraud and money laundering charges.

Chastain, 31, and his lawyers declined comment immediately after the Manhattan federal court hearing.

U.S. Attorney Damian Williams said the charges were a first because they pertained to NFTs, or non-fungible tokens, that provide digital ownership of art and other content.

Michael J. Driscoll, head of New York's FBI office, said Chastain used his knowledge of confidential information to buy dozens of NFTs in advance of them being featured on OpenSea's homepage. OpenSea is the largest online marketplace for the purchase and sale of NFTs, authorities noted.


Driscoll said the emergence of any new investment tool such as “blockchain supported non-fungible tokens” will lead some to exploit its vulnerabilities for illegal profits.

“NFTs might be new, but this type of criminal scheme is not," Williams said. "Nathaniel Chastain betrayed OpenSea by using its confidential business information to make money for himself. Today’s charges demonstrate the commitment of this Office to stamping out insider trading — whether it occurs on the stock market or the blockchain.”

Chastain, as part of his job, was responsible for selecting NFTs to be featured on OpenSea's homepage, authorities said. They added that price buyers were usually willing to pay more for an NFT once it was featured on OpenSea's homepage, enabling Chastain to sell them at two- to five-times his initial purchase price.

He concealed the fraud by conducting the purchases and sales through anonymous digital currency wallets and anonymous accounts at OpenSea, authorities said.

Larry Neumeister, The Associated Press

Ex-OpenSea employee charged in first NFT insider trading case

"A Single Number That Has 10,000,086 Digits" by Ryoji Ikeda is on display along with other NFT art at Sotheby's first physical exhibition of NFTs, featuring the first NFT ever minted presented in partnership with Samsung on, June 4, 2021, in New York City. On Wednesday, federal prosecutors announced the United States first insider trading case involving NFTs. 

Photo by John Angelillo/UPI | License Photo

June 1 (UPI) -- Federal prosecutors have arrested a former employee of the largest online marketplace for non-fungible tokens on charges of using company information for personal financial gain, making it the United States' first insider trading case involving digital assets.

The Justice Department announced in a statement that prosecutors in New York on Wednesday unsealed an indictment charging Nathaniel Chastain, 31, with one count of wire fraud and one count of money laundering, each of which carry a 20-year maximum prison sentence.

The New York resident was arrested Wednesday morning before making his first appearance at the U.S. District Court for the Southern District of New York.

"NFTs might be new, but this type of criminal scheme is not," U.S. Attorney Damian Williams said.

According to a February Treasury report on money laundering and terror finance through the trade of artworks, NFTs are publicly verifiable blockchain-based digital tokens representing ownership of images, videos and audio files as well as other forms of media.

These digital tokens are sold online, with the market for NFTs producing more than $1.5 billion in trading during the first three months of last year, the report said.

Federal prosecutors charged Chastain, a former employee of OpenSea, the largest NFT marketplace, with exploiting his advanced knowledge of which NFTs would be featured on the company's homepage for personal again.

The charging document states that information about which NFTs would be selected for the website was kept secret as after the digital tokens were featured the price consumers were would pay for them "typically increased substantially."

Chastain was responsible for selecting which NFTs would be featured on OpenSea's homepage, and he secretly purchased dozens of these digital assets and sold them at a profit shortly after they were featured on his company's website, prosecutors said, adding the scheme ran from from June to September of last year.

To conceal his identity, Chastain is accused of using anonymous digital currency wallets and anonymous accounts on OpenSea to buy and sell the NFTs, prosecutors said.

"With the emergence of any new investment tool, such as blockchain-supported non-fungible tokens, there are those who will exploit vulnerabilities for their own gain," FBI Assistant Director-in-Charge Michael Driscoll said. "The FBI will continue to aggressively pursue actors who choose to manipulate the market in this way."

Paraguay's slow slide into a state held hostage to drug trafficking

AFP - Yesterday 


Two Paraguayan officials murdered in as many weeks: an anti-drug prosecutor executed while on honeymoon in Colombia and a mayor gunned down outside his office.


© NORBERTO DUARTEParaguayan security forces destroy a drug factory in Pedro Juan Caballero in May 2022

These incidents have sent a disturbing signal that parts of the South American country are falling under the influence -- and bullets -- of organized crime and drug traffickers.

A few months ago, the mayor of Pedro Juan Caballero, a northeastern city on the border with Brazil, complained bitterly that mafia groups "walk around armed and no-one does anything.

"How can you walk around the streets armed with an AR-15 or AK-47?" asked Jose Carlos Acevedo, 51.

"The citizenry knows what happens here but (apparently) the police don't know and the public prosecutor's office doesn't know."

It was one of the last interviews the mayor would give before being struck on May 17 by a hail of bullets as he left town hall.

A week earlier, Marcelo Pecci, a leading prosecutor in Paraguay's fight against drug trafficking and money laundering, was shot dead execution-style on a Colombian island in front of his wife.

One line of inquiry, according to sources close to the investigation, has pointed to the suspected crime boss Sergio de Arruda Quintiliano Neto, known as "The Minotaur", who has been detained since 2019 in Brazil.

The alleged leader of the Brazilian First Capital Command (PCC) gang was arrested as part of a probe led by Pecci.

At the time of his death, the 45-year-old Pecci was compiling evidence against captured criminals belonging to the PCC and Red Command (CV), groups that originated in Brazil but now also operate in Paraguay.

A small, landlocked country of 7.3 million between Argentina, Bolivia and Brazil, Paraguay has traditionally been known as a marijuana producer.

But "we have become the regional distribution center for Andean cocaine. From Paraguay, shipments are sent through the ports of Buenos Aires and Montevideo to Europe," criminologist Juan Martens from the National University of Asuncion told AFP.


The country "is located in a strategic region for smuggling and drug-trafficking," said Arnaldo Giuzzio, a former interior minister and anti-drugs chief.

- 'Big fish starting to fall' -

In Pedro Juan Caballero, the capital of northeastern Amambay province, there is a volatile mix of anti-drug trafficking operations, score settling between rival organized crime groups and murders of officials who try to tackle the scourge.

Even family members can be targeted: the niece of former mayor Acevedo was killed in 2021.

The province, a hub for transporting drugs into neighboring Brazil, had a murder rate in 2020 of 70 per 100,000 inhabitants -- 10 times the national average.

Just last week, police in that region destroyed 600 tons of marijuana in a highly publicized operation following Pecci's murder.

Over the course of this year, more than 1,000 hectares of marijuana crops have been destroyed, while 3,400 tons of the plant has been taken off the market, "causing drug traffickers to lose $103 million," Paraguay's anti-drugs spokesman Francisco Ayala told AFP.

On top of that, 2.2 tons of cocaine have been seized.

President Mario Abdo Benitez, who has faced harsh criticism for a perceived lack of success against the drug traffickers, trumpeted the "record" figures and the fact that "big fish are starting to fall."

But he also painted a bleak picture of a country where "organized crime pays politicians, pays parliamentarians, pays prosecutors, magistrates and various authorities," without naming any.

Martens says crime gangs have been "progressively taking control of various institutions" in the country.

"Here in Paraguay we have drug-breeding, drug-soyabean, drug-sport (through club owners), drug-religion, drug-universities."

Abdo says there is "a war" being waged against drug trafficking that "will be tough and will last."

Paraguay's Congress recently began debating new legislation aimed at better controlling the nation's airspace, which Martens has described as the "open sky."

Some members of Congress hope to give the Air Force more authority to shoot down non-identified or "hostile" tourist planes frequently used by drug traffickers.

But the military has said that to tackle the problem it prefers improved radar systems and airplanes over new legislation.

hro-pbl/lab/ybl/bc/des

WORLD BICYCLE DAY

Will the bicycle help us address pressing social issues?

The Conversation

JUNE 3,2022

World Bicycle Day is celebrated on June 3 in support of the idea that bicycles “contribute to cleaner air and less congestion and makes education, health care and other social services more accessible to the most vulnerable populations.”

The bicycle plays a massive role in physical activity. This was especially evident during the pandemic, as bicycle purchases skyrocketed. Amid lockdown measures, cycling remained a crucial alternative to public transportation, while offering the benefit of outdoor and socially distanced physical activity. But even before the pandemic started, people’s interest in bikes was growing.

Cycling could be the answer to more than just our physical activity and pandemic woes. It could offer public officials a way to address convergent crises in public health, transportation and climate. At the same time, increased bicycle use can generate new economic opportunities, like offering low-cost bicycles for sustainable transport and mechanical training to local communities to create jobs.

And as gas prices continue to rise due to the ongoing invasion of Ukraine, governments are urging citizens to consider the bicycle. What’s clear is that the bicycle’s capacity to respond to pressing social issues has inspired both intrigue and optimism, especially in the context of COVID-19.
Bicycles for development

We are a group of researchers interested in the social and environmental dimensions of sport, physical activity and health with a focus — for the work described here — on the perceived role of development in the emergent cycling boom.

So far our research has attempted to map out the bicycles for development movement, which considers the bicycle a powerful technology that holds notable implications for social change and development objectives.

Our research shows that this movement is driven largely by the work of non-governmental organizations delivering bicycles to communities across the globe.

These initiatives can be entirely local, although they often cross international lines — organizations collecting used bicycles in one place sometimes ship them elsewhere. Bicycles that are delivered to communities often come from donations, micro-financing initiatives or social entrepreneurial ventures, like those led by women in rural Uganda.

Over the past six years our research in Canada, Nicaragua and Uganda has highlighted key ways that bicycles for development initiatives seem to have positive effects. For example, bicycle access can foster mobility, which can lead to various opportunities (like accessing educational opportunities and local markets to sell goods), and may help promote a sense of social inclusion or economic development.

In Canada, we conducted research with communities in Toronto and Vancouver. Our studies in Toronto showed how bicycles are being taken up by mutual aid organizations to respond to increasing food insecurity during the pandemic. Through focusing on the experiences of 2SLGBTQ+ and racialized cyclists, we highlighted the ways in which diverse cyclists challenge systems of racialized and gendered oppression using the bicycle to dismantle stereotypes about who can participate in cycling.

However, while the bicycle has positive potential, our research also demonstrated that providing bicycles to women and girls is, in some ways, filled with tensions and challenges. For example, in our most recent research in Uganda, some women explained that prior to receiving the bicycle, they were mainly responsible for caregiving and other domestic tasks like cooking.

Upon receiving the bicycle, they now also have to engage in economic activities — meaning more labour-focused expectations for women in rural communities. This often leads to an extension of existing inequalities between men and women.

There was also a concern over the quality of bicycles donated. For example some of the bicycles donated required specific unavailable spare parts meaning they were of little use once they broke down. But programs like World Bicycle Relief’s “Buffalo Bicycle” are geared towards addressing this problem.

The fact that bicycle-driven aid may have unintended and sometimes negative consequences aligns with a wealth of research in the sport for development field, and in development studies more broadly.

We refer to these unintended negative outcomes of development-focused interventions as forms of “ironic activism.”

While our research revealed the positive potential of bicycle access, our findings also steered us in other directions: bicycles might empower people and communities but they may also reflect or exacerbate existing problems and inequalities. Bicycle-based development programs can have both intended and unintended consequences.

While the optimism for World Bicycle Day is welcome, it is important to remember that with all of their potential, bicycles cannot solve our overlapping contemporary crises on their own.

Janet Otte, Patrick Eyul and Lidieth del Soccorro Cruz Centeno co-authored this article. Janet has experience managing development projects on refugees, women’s rights and clinical research in Uganda. Patrick is a social scientist who works with development and research organizations in Uganda. Lidieth is the director of the Asociación Movimiento de Jóvenes de Ometepe in Nicaragua.

This article is republished from The Conversation, a nonprofit news site dedicated to sharing ideas from academic experts.

Read more:
COVID-19 cyclists: Expanding bike lane network can lead to more inclusive cities

Bike share programs are on the rise, yet the gender gap persists

Lyndsay Hayhurst receives funding from the Social Sciences and Humanities Research Council of Canada, Canadian Heritage and the Canadian Foundation for Innovation.

Brad Millington receives funding from the Social Sciences and Humanities Research Council of Canada.

Brian Wilson receives funding from the Social Sciences and Humanities Research Council of Canada.

Jeanette Steinmann receives funding from the Social Sciences and Humanities Research Council of Canada and MITACS.

Jessica Nachman receives funding from the Social Sciences and Humanities Research Council of Canada, the Ontario Graduate Scholarship program, and MITACS.

Mitchell McSweeney receives funding from the Social Sciences and Humanities Research Council of Canada.

China's Tencent revises pay rise policy in memo, amid cost savings pressures

By Josh Ye - Yesterday 

HONG KONG (Reuters) - China's Tencent Holdings has told staff it will no longer guarantee them a pay raise upon promotion, according to an internal letter seen by Reuters, as it reviews its salary policy amid a wider cost-cutting drive.

The Chinese social media and gaming giant told its employees of the policy change on Tuesday, saying the decision was taken as part of a yearly review in consideration of the "company's operation plan and the external environment."

But it said the company would still conduct an annual salary review to consider an individual's contribution and performance.

Tencent, which declined to comment on Wednesday, told staff in 2020 it would no longer guarantee an annual salary rise.

Related video: US labels China a currency manipulator as Beijing allows yuan to sink to lowest level in 11 years

Its latest policy change reflects the changing circumstances of China's technology giants, once among the fastest growing Chinese firms and sought after employers but now hit hard by a bruising regulatory crackdown and a slowing economy.

Tencent, China's most valuable company, reported quarterly earnings last month showing profit halved from a year earlier and revenues stagnated, its worst performance since it went public in 2004.

Founder and Chief Executive Pony Ma told analysts the company had implemented cost control measures and scaled back non-core businesses in the first quarter. He said it was looking to "achieve a more optimised cost structure going forward".

It has shut its Penguin Esports unit. Reuters reported earlier this year that Tencent and peer Alibaba Group planned to make numerous job cuts.

The latest Tencent salary policy change, first reported by local media on Wednesday, was one of the most discussed topics on the Maimai career portal, China's equivalent of Linkedin.

"Quality candidates will now weigh the stability of a Tencent job," said one user on Maimai, who used a pseudonym and said he was a Tencent employee.

Ma caused a stir on Chinese social media recently after he reposted an article on China's economy, breaking his usual silence on an increasingly sensitive topic.

(Reporting by Josh Ye; Editing by Brenda Goh and Edmund Blair)

Green still grey area for ESG investors despite mounting scrutiny by watchdogs in U.S. and Canada

Barbara Shecter - Yesterday 

© Provided by Financial PostIdentifying

Regulators in Canada and the United States are pushing ESG funds to disclose more information to weed out “greenwashing” and other misleading practices, but a lack of standardized terms and metrics mean those buying the funds must still be wary, investor advocates say.

The latest attempt to separate marketing pitches from strategies that truly fulfill environmental objectives come via the U.S. Securities and Exchange Commission, which last week proposed rules that, among other things, crack down on whether fund names accurately reflect the underlying strategy.

Those marketing their funds with a focus on environmental, social or governance objectives would have to invest at least 80 per cent of their assets to that end, according to the proposal. Funds would also have to disclose information about the emissions of companies they hold, and how they measure their progress against stated goals, in their communication with investors through fund prospectuses, annual reports and adviser brochures.

Canadian regulators, too, have been focused on identifying greenwashing in the fund business. Last year, the Canadian Securities Administrators, an umbrella organization for the country’s provincial and territorial market watchdogs, oversaw a wide-ranging review of the marketing, regulatory disclosure and sales communications of funds whose investment objectives reference ESG strategies.

Following the review, which found that more than half the funds scrutinized “lacked detailed disclosure in their investment strategies about the specific ESG factors considered by the fund,” the CSA issued fresh guidance to the industry in January.

The CSA review also uncovered a widespread failure to disclose how ESG factors were evaluated, and more than a third of the funds reviewed held investments in industries that should not have been permitted by their exclusionary investment strategies. Further, about one-fifth of the funds reviewed had portfolio holdings that appeared to be inconsistent with the fund’s name, investment objectives or investment strategies.

The guidance introduced this year “aims to bring greater clarity to ESG-related fund disclosure and sales communications to enable investors to make more informed investment decisions,” said Ilana Kelemen, a spokesperson for the CSA.

Still, with a growing number of ESG-marketed funds and no strict or uniform criteria for what they must accomplish on social, environmental or governance issues, investment advocates and environmental groups don’t expect a one-size-fits-all solution.

“The essential problem is that the world still lacks accepted, standardized metrics for ESG — so for the time being, ‘green’ is grey,” said Neil Gross, a veteran securities lawyer and investor advocate.

The responses from regulators on both sides of the Canada-U.S. border seem to back up the notion that they have a limited role to play for now, putting the emphasis on beefing up and policing disclosure requirements rather than writing new rules and enforcing a specific code.

“Regulators can and should help us to separate the meaningful from the marketing, by requiring more complete disclosure from fund managers about the elements and depth of their approach,” said Kevin Thomas, chief executive officer of the Shareholder Association for Research and Education (SHARE).

“What they can’t do is to regulate what constitutes the one, true, ESG strategy, because those strategies vary widely and are regularly being tested and updated as we learn more about what’s needed and what works.”

With no new rules on the books in Canada, it will be up to individual provincial and territorial regulators to determine when and where enforcement action is warranted, according to Gross.

The CSA noted that its review of 32 funds, managed by 23 different investment fund managers, was intended to gauge how existing disclosure standards including “full, true and plain disclosure of all material facts” were being applied to funds that referenced ESG in their investment objectives or strategies or marketed themselves in online sales communications as ESG-related funds.

The umbrella group also noted that some of its findings were observational, rather than strictly related to compliance with disclosure requirements.

The SEC rules on ESG-related disclosure proposed last week are open for a 60-day comment period and aren’t expected to be finalized for several months, but that hasn’t stopped regulators from taking action in specific cases.

Earlier this month, the SEC imposed a first-of-its-kind fine of US$1.5 million on the investment advisory arm of BNY Mellon in a settlement over allegations of misstatements and omissions related to information about ESG investment criteria for its mutual funds between July 2018 and September 2021. Before the settlement, the regulator had alleged that while various fund statements suggested all investments in the funds had undergone an ESG quality review, this was not always the case.

Regulators aren’t alone in pushing for greater transparency and uniformity when it comes to climate-related activity, and funds aren’t the only target. In Canada’s spring budget, for example, Justin Trudeau’s Liberal government pledged to require big banks to disclose climate-related financial risks.

The Office of the Superintendent of Financial Institutions (OSFI) is now consulting with banks and other federally regulated financial institutions on climate disclosure guidelines that will adhere to the global Task Force on Climate-related Financial Disclosures framework.

And separate from the review that led to fresh guidance for the fund industry in January, the CSA has sought input on how a wider range of companies should disclose climate-related risks, opportunities and financial impacts to address concerns disclosure is not complete, consistent, or comparable. The regulator said tackling these issues would improve access to global capital markets in part “by aligning Canadian disclosure standards with expectations of international investors.”

Canadian climate activists ask bankers to close ESG debt loopholes

Green investing: The risk of a new misselling scandal

Emerging ESG bond boom puts world on path to sell US$1.8 trillion

The comment period ended in February, and the CSA’s Kelemen said staff are reviewing the comments received, as well as rules proposed by the SEC and disclosure standards proposed by the International Sustainability Standards Board. They will then make recommendations for “a final form of rule” to the provincial and territorial securities regulators that are members of the CSA.

Some, including the Ontario Securities Commission, already appear to be preparing to beef up requirements, Gross said.

“A year ago, OSC and BCSC (British Columbia Securities Commission) staff began sweeps to assess the general accuracy of ESG claims,” he said, adding that the OSC laid out plans to further consult and develop rules for companies on climate-change disclosure in the regulator’s statement of priorities for 2022-23.

• Email: bshecter@postmedia.com | Twitter: BatPost

Groups urge U.S. to probe 'loot box' on Electronic Arts video game

By Diane Bartz - 

© Reuters/Lucy NicholsonFILE PHOTO: People play Electronic Arts' "FIFA" video game at the Microsoft Xbox booth at the Electronic Entertainment Expo, or E3, in Los Angeles

WASHINGTON (Reuters) - Consumer advocates on Thursday urged U.S. regulators to investigate video game maker Electronic Arts Inc for the misleading use of a digital "loot box" that "aggressively" urges players to spend more money while playing a popular soccer game.


© Reuters/Brendan McDermidFILE PHOTO: The Electronic Arts Inc., logo is displayed on a screen during a PlayStation 4 Pro launch event in New York

The groups Fairplay, Center for Digital Democracy and 13 other organizations urged the Federal Trade Commission to probe the EA game "FIFA: Ultimate Team".

In the game, players build a soccer team using avatars of real players, and compete against other teams. In a letter to the FTC, the groups said the game usually costs $50 to $100 but that the company would push players to spend more while they played.


© Reuters/DADO RUVICIllustration shows Electronic Arts and FIFA logos

"It entices players to buy packs in search of special players," said the letter sent by these groups along with the Consumer Federation of America and Massachusetts Council on Gaming and Health and others.

The packs, or loot boxes, are packages of digital content sometimes purchased with real money that give the purchaser a potential advantage in a game. They can be purchased with digital currency, which can obscure how much is spent, they said

"The chances of opening a coveted card, such as a Player of the Year, are miniscule unless a gamer spends thousands of dollars on points or plays for thousands of hours to earn coins," the groups said in the letter.

The letter also linked the loot boxes to gambling.

"In some cases, young people who have already developed problem gambling behaviors seek out games with loot boxes; for others, loot boxes are a gateway to problem gambling," they wrote.

The FTC, which goes after companies that engage in deceptive behavior, held a workshop on loot boxes in 2019. In a "staff perspective" which followed, the agency noted that video game microtransactions have become a multi-billion-dollar market.

(Reporting by Diane Bartz; Editing by David Gregorio)

Stagflation-lite? Risk of stagflation grows, though unlikely a repeat of 1970s

Yesterday

Canada is leaning toward a new era of 1970s-style stagflation as the pace of economic growth slows yet inflation remains stubbornly high, economists say.


© Provided by The Canadian PressStagflation-lite? Risk of stagflation grows, though unlikely a repeat of 1970s

The abnormal mix of rising prices and high joblessness gripped the country 40-odd years ago.

Supply shocks sent energy costs soaring, interest rates climbed to devastating heights and unemployment was rampant.

Now some experts say conditions are ripe for a return of the economic phenomenon.

"I would say in the next year we're looking at a recession in this country, which in combination with continued inflation could spell stagflation," said Armine Yalnizyan, an economist and Atkinson Foundation fellow.

"We can't duck the global forces that are pointing at recession ... the question is whether raising interest rates will slow inflation."

While stagflation could make a comeback, it would likely be a more mellow version of the economic anomaly — a sort of stagflation-lite.

"I don't think it's unrealistic to expect that we could see a world where we have higher inflation and higher unemployment," said Fred Bergman, a senior policy analyst with the Atlantic Provinces Economic Council, an independent Halifax-based economic think tank.

"We could see those two tracking up, which is rare. But it's going to be very modest compared to what we saw back in the 1970s and 1980s."

The simultaneous increase in inflation and unemployment stumped economists and policymakers in the 1970s.

Economics 101 would say the macroeconomic issues of inflation and unemployment have an inverse relationship. High inflation occurs during periods of low unemployment and vice versa.

Stagflation topples this theory by pairing high inflation with rising joblessness and slowing growth.

Solving it is a conundrum. The levers used to tackle inflation could slow the economy and ratchet up joblessness, while efforts to spur economic growth could fuel rising prices.

"This creates a bit of a quagmire for policy people," Bergman said. "When the inverse relationship between unemployment and inflation is upended, it leads to a policy dichotomy."

The challenge facing the Bank of Canada is raising interest rates enough to tame inflation but not triggering a recession.

In an unprecedented move, the central bank hiked its key interest rate for the second time in two months on Wednesday, bringing its policy rate to 1.5 per cent.

But it's unclear whether it will be enough to temper inflation.

The annual pace of inflation rose to 6.8 per cent in April, the fastest year-over-year rise in more than three decades.

Finding the interest rate sweet spot is complicated by the fact that there's a lag effect between higher rates and the influence on consumer spending and business investment.

"They're walking a fine line and it's a bit of a balancing act," Bergman said. "We're going to see the economy slow down and ... we could move to the borderline of a recession."

In a speech last month, Bank of Canada deputy governor Toni Gravelle said comparisons between rising inflation now with the stagflation period of the 1970s aren’t justified.

"We don’t see the stagnant part of stagflation — quite the opposite," he said. "The Canadian economy, across many measures, is running pretty hot."

While higher interest rates will reduce demand and slow growth, they should also reduce inflation — undercutting the inflation component of stagflation, he said.

The trouble is, it might not, economists say.

Some factors pushing up prices in Canada are likely to continue despite higher interest rates.

"There are other forces that could keep inflation high, even though the economy is going down," said Nicolas Vincent, an economics professor at HEC Montréal.

"We keep getting hit by supply shocks."

Russia’s invasion of Ukraine, COVID-19 lockdowns in China and backlogged supply chains are all fuelling higher prices.

These situations are likely to continue.

"The invasion of Ukraine and the China experience guarantees that we are looking at at least another year of this until price pressures start to unwind," Yalnizyan said.

"The easiest tools we have in our tool box are central bank policies, which themselves will slow growth but they risk making the situation worse not better ... it's a tightrope exercise."

The stagflation problem that started in the 1970s only ended in the early 1980s when the Bank of Canada hiked interest rates to the point where the prime lending rate soared to above 20 per cent, the Conference Board of Canada said in a recent analysis.

"Inflation and inflation expectations eventually plunged, but the cost was a brutal recession that saw the unemployment rate hit 12 per cent in the early 1980s," the Conference Board said in the March report.

In other words, the remedy used to fix inflation could cause nearly as much pain in other areas.

Still, several conditions today are different than in the 1970s and could help Canada dodge stagflation.

Canada's unemployment rate fell to a record low of 5.2 per cent in April, Statistics Canada said last month.

The robust jobs market and ongoing labour shortage in several industries across the country is in stark contrast to the high unemployment recorded when baby boomers were young four decades ago.

"The labour market is running really hot," said William Robson, president and CEO of the C.D. Howe Institute, an Toronto-based think tank.

"There are parallels to the 1970s but our unemployment rate is in a much better place."

Demographics and an aging population will also help keep joblessness at bay, he added.

Canada could benefit from ongoing higher commodity prices, potentially even fuelling a higher trade surplus.

Meanwhile, the country has significantly less unionization with fewer cost-of-living allowances baked into collective agreements and contracts.

"Workers in the past tried to catch up to price increases because otherwise they would be losing purchasing power," Yalnizyan said. "It led to a price-wage spiral where the one just kept feeding the other."

This report by The Canadian Press was first published June 1, 2022.

Brett Bundale, The Canadian Press

YouTube could be liable for unauthorised uploads if slow to act, German court rules

Yesterday 

BERLIN (Reuters) - Google's YouTube and other platforms could have to pay copyright damages over unauthorised uploads even if the content was put online by a third party, Germany's top court ruled.


© Reuters/Dado RuvicA silhouette of a mobile user is seen next to a screen projection of Youtube logo in this picture illustration

The platforms would be liable only if they did not act quickly to block access once they had learned of illegal uploads, the court said in its ruling on Thursday.

The case comes amid a long-running battle between Europe's $1 trillion creative industry and online platforms, with the former seeking redress for unauthorised uploads.

It is also part of the wider debate on how much online platforms and social media should do to police the posting of unauthorised, illegal or hateful content.

Operators of upload platforms could in principle also be obliged to disclose the identify of users who commit the infringements and their email addresses, according to the ruling.

The court based its ruling on one issued by the EU Court of Justice last year.

Thursday's decision involves a lawsuit filed by a music producer after video and audio recordings of an artist he owned the rights to were still available on YouTube even after the producer's lawyer had sent a letter asking them to be removed.

No final decision was taken by the court over whether YouTube was liable, which means the case will return to the lower courts for re-examination based on the new guidelines.

YouTube said it was confident in the systems it had built to fight copyright infringement and ensure rights holders would receive their fair share.

(Reporting by Ursula Knapp and Miranda Murray; Editing by Nick Macfie)

U.S. Supreme Court inching closer to loosening gun laws

by Stephon Johnson

June 2, 2022

Gavel in front of a pistol. Gun laws and legislation concept. Credit: Courtesy of: vhcal

It’s the nightmare of any Democratic-dominated state or big city. These already have issues with guns being imported from states with looser laws.

A U.S. Supreme Court case could forever alter how America operates in the decades to come.

In New York State Rifle & Pistol Assn. vs. Bruen, gun owners go virtually face-to-face with Democrat-dominated states and cities over the right to bear arms in public. The NRA and Co. is touting the second amendment as backup in their argument. States like New York and California don’t allow gun owners to carry in public, but are allowed to keep them in the home. That is not good enough for the NRA. They believe that the law violates the second amendment.

During Monday’s news conference, New York City Mayor Eric Adams said City Hall and law enforcement need to stay alert. He said he’s prepared to take on real guns, ghost guns and all guns.

“Open carry is a crisis,” the mayor said on MSNBC’s “Morning Joe” program. “Can you imagine being on the four train as someone openly carrying a firearm? And then, we need to have the coordination between our ATF. Right now, we only have 2,400 ATF agents in our entire country. About 60 of them are here in New York. We have to double their size.” Adams then discussed the scenarios of gang members and other dangerous individuals carrying guns in public.

Guns are at the forefront of the American conversation after two high-profile incidents in May. Most recently, 18-year-old Salvador Ramos allegedly shot and killed 19 children (and several teachers) at Robb Elementary School in Uvalde, Texas. Like the tragedy in Sandy Hook, Ramos shot and killed his grandmother before making his way to the school. Ramos had allegedly shown signs of erratic and threatening behavior online, but was never reported to the authorities.


Before that, a tragic, racist shooting occurred in East Buffalo where 10 people were killed and three were wounded outside of a Tops supermarket in the predominantly-Black neighborhood. The shooter, 18-year-old Payton Gendron, drove three hours from Conklin (a town just south of Binghamton) to East Buffalo for the specific purpose of killing Black people. Both Ramos and Gendron allegedly detailed what they were planning on doing in manifestos/comments written online.

In April, 62-year-old Frank James allegedly fired 33 bullets from a handgun (and threw smoke grenades) that hit 10, but left several dozen injured during the mass escape out of the 36th Street subway station in Sunset Park, Brooklyn. He’d also posted videos online showcasing erratic behavior.

The challenge to New York’s gun laws are part of a strategy by gun owners to allow public carry all over the United States. As of this week, 25 of the 50 states (Georgia being the most recent one) have codified it into law.

This comes after the NRA lost a federal bankruptcy request after the group attempted to reorganize in Texas. New York State Attorney General Letitia James can now continue her process of possibly dissolving the organization. The NRA filed for chapter 11 bankruptcy in early 2022 to, according to the AG, avoid “New York’s enforcement action.”

In a 2016 report, the New York State Attorney General Office found that 74% of guns used in crimes between 2010 and 2015 were imported from areas that have less restrictive gun laws. Chicago, a place that’s become the go-to talking point for political conservatives, has suffered a similar fate. A 2017 Gun Trace Report by the Chicago Police Department, the University of Chicago Crime Lab and then mayor Rahm Emanuel, revealed that 60% of all guns that were recovered in the city came from out of state. Twenty percent of them came from Indiana, a state that has weaker gun laws.
In Texas, Gov. Greg Abbott said that he was declaring Uvalde a disaster area and that the state would provide as much help as the city needs.

“The community of Uvalde has been left devastated by last week’s senseless act of violence at Robb Elementary School and should not have to encounter any difficulty in receiving the support needed to heal,” stated Abbott. “This disaster declaration frees up the many resources available through the State of Texas and local jurisdictions to continue providing much needed support to all who were impacted and work in the community unencumbered by regulations unnecessary to respond to this tragedy. All of Texas stands with Uvalde, and we are prepared to provide support through all available means.”

Several days after the shooting, the NRA held its annual meeting at the George R. Brown Convention Center in Houston. According to Google, it would take someone four hours to drive from Uvalde to Houston. Just one hour less than Gendron’s ride from Conklin to East Buffalo.

This is what’s at stake, in some people’s eyes, when it comes to New York State Rifle & Pistol Assn. vs. Bruen. The line between fostering and not fostering an environment for mayhem.

“Outside a salon. In a supermarket. A subway. A school. Gun violence pervades every corner of our communities because guns are perversely fetishized and endlessly accessible in our country,” stated New York City Public Advocate Jumaane Williams. “There will be explanations uncovered and excuses put forward for this inexcusable violence, but all are enabled by the weapons in the hands of a shooter, and the people and systems that put them there.”

Biden faces pressure to help Black borrowers with heavy student debt

Aris Folley -


President Biden is reported to be closing in on a plan to cancel $10,000 in federal student debt per borrower, but some advocates are concerned about the impact it will have on Black borrowers, who data shows are likely to owe more to cover the costs of education.


© Provided by The HillBiden faces pressure to help Black borrowers with heavy student debt

Many Democrats at the helm of student loan forgiveness efforts have promoted broad-based cancellation as a way to advance racial equity, often citing data showing the disproportionate burden faced by Black borrowers, especially women.

But, as more reports surface of Biden’s plans narrowing in on a decision on some student debt forgiveness, advocates are dialing up the pressure.

“The impact that $10,000 would have would be so minor, that it wouldn’t really address the real issue for Black borrowers,” said Wisdom Cole, national director of the NAACP Youth & College Division.

Data from The Institute for College Access and Success (TICAS) found that Black graduates, who advocates acknowledge often have less access to intergenerational wealth due to historical racial discrimination, were more likely than other racial groups in 2016 to take on student debt, and more of it.

In the report, which cites figures from the Department of Education, 80 percent of Black bachelor’s degree recipients also were found to have graduated with an average debt of $34,000 at the time, more than their white, Hispanic, Latino, and Asian peers.

The data also adds to research from the Brookings Institution finding Black graduates are more likely than their white peers to default, and less likely to own a home than white Americans without a high school diploma.

A number of advocates and lawmakers say the White House should go as far as possible in cancellation to address the disproportionate amount of federal student debt carried by Black borrowers, pushing for total cancellation of the debt.

The calls build upon a growing push by Democratic lawmakers calling for Biden to support more significant cancellation, including approving as high as $50,000 in loan forgiveness.

“People are drowning in debt, especially Black borrowers, 10 years after taking out these loans. Two thirds of black borrowers hold more than they did when they started, more. Twenty years out they owe 95 percent of the loan. So, it’s also a racial equity issue here,” Sen. Raphael Warnock (D-Ga.) told reporters last month after a meeting with Biden on the matter.

The campaign adds pressure to Biden ahead of the pivotal midterm races in November, amid ongoing attacks from Republicans over the student loans push they say is unfair, and as some experts warn of the effects limited debt action could have on economic efforts to promote racial equity in the long run.

Despite calls to go higher, reports that have surfaced in recent weeks signal the White House is most seriously looking at providing $10,000 in cancellation for some borrowers, in keeping with a previous campaign pledge by the president.

A recent version of the plan reported on by The Washington Post involved income caps for eligibility, restricting cancellation to individuals that brought in under $150,000 in 2021, and $300,000 for couples.

With those restrictions in place, student loan expert Mary Jo Terry said the intent appears to be aimed at helping “lower to middle class individuals in this scenario, which is going to help the racial divide.”

Sandy Baum, a nonresident senior fellow at the Urban Institute’s Center on Education Data and Policy, also said last month that the proposed cancellation could make a difference for borrowers who “hold just a little bit of debt” and are struggling financially.

“About a third of the people who have student debt, hold only 4 percent of the debt, so, in other words, a third of borrowers owe less than $10,000 that all together as up to 4 percent of all the outstanding debt,” Baum said. “But at the other end of the spectrum, you have about 7 percent of borrowers who owe more than $100,000.”

Some advocates have pushed back against applying means testing for eligibility, given fluctuations in income and economic instability during the pandemic, among other reasons.

Frederick Bell Jr., organizer at the Debt Collective, called the reported plan to attach income caps to debt forgiveness “​​a very slippery slope,” adding he often views means-testing as a way to “silence the right.”

Cole similarly expressed concerns about the reported income restrictions, arguing the impact it could have on shutting out Black women, as he said more are “continuing to seek higher education and degrees to support their families, and to support the community.”

“Income is not the same as wealth, and it’s very important that the administration consider the debt-to-income ratio, when thinking about a solution that is going to be equitable for all,” Cole said, adding “the way your dollar may stretch doesn’t look the same, from the Black community to the white community.”

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