“Sacramento saw record cold temperatures Sunday morning ahead of more stormy weather set to hit Northern California in the afternoon,” the Sacramento Bee reported on September 29. To the north, “Red Bluff also set a record Sunday morning, reaching 42 degrees and breaking a 1971 record low of 45 degrees.” Snow was falling in the Sierra Nevada, but nothing like Montana.

As USA Today reported, also on September 29, “one week after summer’s end, a ‘winter’ storm began blasting parts of the West with up to 3 feet of snow, smashing records with low temperatures, heavy snow, strong winds and blizzard conditions.” In addition, “Many daily record low maximum temperature records are possible through Monday, especially across the Northern Great Basin, Rockies and Northern California.”

Institutional Risk Analyst editor R. Christopher Whalen has written an insightful article exploring the origins of the new liquidity crisis the Federal Reserve is now fighting, a crisis in which the U.S. government’s fiscal policies — how it imposes taxes and spends money — may have played a major contributing role.

Whalen provides a good primer for understanding a situation that one analyst has described as a potential “Black Swan event,” a catastrophic occurrence that is generally believed to be so unlikely that when it shows up, nobody is prepared to cope with it because it was too unpredictable.

Our dear, longtime friend Cassandra Chrones Moore passed away on Sunday, July 7, 2019, at Stanford Hospital. Her husband, Thomas Gale Moore (founding member, Board of Advisors, Independent Institute), and her children, Charles and Antonia (Tonia), were at her side. Hospitalized the previous Friday, she died of aortic valve stenosis, a heart condition that had reduced her strength over time.

Cassandra was born in Oneonta in upstate New York. Her mother, Antonia Laskaris Chrones, from a Greek family, went back to Greece in the 1920s where she met and married Cassandra’s father, Constantine Chrones, known as Gus. Antonia and Gus started their family back in the U.S., where Gus became a successful businessman.

As NBC News reports, presidential candidate Beto O’Rourke is pushing “mandatory buybacks of certain semi-automatic weapons.” His plan would “ban weapons classified as ‘assault weapons’ as well as high-capacity magazines and silencers. It would also mandate that people who own weapons that become illegal under the new policy sell their guns back to the government.” That is going to be difficult because the owners did not buy their guns from the government in the first place. 

They bought them from independent gun dealers, licensed to sell firearms and ammunition. That is even the case with so-called “assault weapons,” which despite their menacing appearance are no different than any semiautomatic rifle, and less powerful than many bolt-action hunting rifles. Candidate O’Rourke is also on record that, “Hell yes we’re going to take your AR-15,” which he has emblazoned on campaign T-shirts. No word whether the legal owners of the AR-15 committed any kind of crime. Agents of the government will show up at private residences and “take” legally purchased private property. No word whether, as in other takings, the legal owners will be compensated for the seizure.

Even after the Supreme Court’s 1978 Bakke ruling, the University of California persisted in admitting students on the basis of race and ethnicity, not merit and test scores. Californians put a stop to such discrimination in 1996 by passing the California Civil Rights Initiative, Proposition 209, which bans racial and ethnic preferences in state education, employment and contracting. Opponents argued that the measure would end minority representation, but that turned out to be wrong. 

As Fox Business reports, “The number one most diverse public university in the country is UC Davis, where 30,066 undergraduates are enrolled at a diversity index rate of 77.64.” The diversity index is a continuum that ranges from 0 to 100 to calculate whether a population is more evenly divided across race and ethnic groups. By this standard, UCLA comes second, UC Santa Barbara fourth, UC San Diego sixth, UC Berkeley ninth, and UC Irvine tenth. So diversity endures, but only in race and ethnicity.

There are now 90 homeless camps in Oakland—more than one camp per square mile—most even worse than that pictured, each littered with unimaginable filth and trash.

Yet how does the government choose to allocate the resources it never fails to remind us are severely limited—it can’t pave the streets, educate kids, respond to 911 calls, or do anything to stop spiraling homelessness?

Patrolling private garbage cans and dumpsters.

We received via Certified Mail a notice bearing this badge, of our Violation of the “Mandatory Recycling and Plant Debris Disposal Ban Ordinances,” accompanied by seven photos of the outside and interior of our garbage dumpster, showing—horrors!—a cardboard box and some lunch room food waste included in our trash!

The following violations and fines were checked:

• Disposal of Covered Materials – Recyclables Section 2012.01.4(a) $100.00
• Provide information at least annually to tenants, employees, and contractors of their obligation to keep Covered Materials from garbage $300.00

A story in my local newspaper (I live in Tallahassee, Florida) discusses the priorities of the next Speaker of the Florida House of Representatives, Chris Sprowls. One interesting thing about this story is that Representative Sprowls will not become Speaker of the House until after the 2020 election, more than a year away, after he has been reelected to his House seat.

The article confidently refers to him as the next Speaker even though (1) he has to win reelection, and (2) enough Republicans must win reelection in the 2020 election for the party to retain its majority in the House. I repeat: the election is more than a year away!

The liquidity crisis feared by financial analysts has arrived. Sparked by a surge in the U.S. government’s borrowing following the Bipartisan Budget Deal, the Federal Reserve has been forced to intervene in the nation’s money markets to fill a critical shortage of money by making emergency overnight cash loans, called “repos”, for the first time since the financial crisis of 2008.

Southern Utah University economist David Tufte explains what started happening in the last week in plain English:

The Fed has been heavily buying repurchase agreements (repos). Translated, this means they’re trying to reduce short term interest rates. Quite aggressively too.

Nathan Tankus explains that this is a response to the Basel III accords for avoiding and managing financial crises. These are not official yet, but the U.S. is following them. This is the first time they’ve had to do this particular thing, and it’s been clumsy, but not a problem.

Basically, the really large banks now have to have enough liquidity to get themselves through 30 days of bad news. But that means they have to hoard liquidity. But liquidity is costly to hold; in the past their (internal) liquidity would go up and down with interest rates, as they sold and bought Treasury bills. Those big banks have been short on liquidity so they’ve been hoarding it. This drove up rates. A central bank is supposed to respond to this by buying securities from the banks. That’s the repos. The Fed was a bit slow on the uptake that this is the way the world works now.

University of California President Janet Napolitano is stepping down from the post she has held since 2013. Californians, particularly students, have cause to wonder why she was given the job in the first place. Never known as an educator, Napolitano ruled the university like a typical politician.

As the Sacramento Bee noted, “in 2017, a state audit alleged Napolitano’s office hid $175 million from the public while tuition increased,” and it was just a bit more than an allegation. Napolitano used the money to shower perks on staff and renovate the houses of UC chancellors. State Auditor Elaine Howle reported that Napolitano’s office “intentionally interfered” with their investigators. Despite the corruption and obstructionism, Napolitano faced no criminal charges.

Pop icon Jennifer Lopez is getting Oscar buzz for her lead-actor performance in Hustlers, a drama focused on the relationships and business surrounding the strip club scene before and after the financial crisis and collapse of Wall Street in 2008. The buzz is well-earned. Lopez turns in a top-flight performance in this well-scripted and complicated story of economic survival, grey ethical lines, loyalty, and betrayal.

The movie stays well within its R rating, and screenwriter and director Lorene Scafaria keeps the story focused on the women at its center. Ramona (Lopez) is a veteran stripper who has figured out how to turn her pole-dancing performances into cash. The story, however, is told from the point of view of Dorothy, aka Destiny (Constance Wu, Crazy Rich Asians), a struggling single mother who is desperate to pay her bills and support her elderly grandmother.