Monthly Archives: March 2023

Terrorists in the Mix

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CBP agents have caught 70 illegal aliens who are also terrorists on the government’s terrorist watchlist (including one who illegally entered through our northern border). That’s just in the five months of the current fiscal year, and those 70 compare with the 98 caught in the entirety of the prior fiscal year. This year’s pace, according to my third-grade arithmetic, works out to 168 terrorists that might be caught over the full course of this year.

That’s also only the ones we know about. Left uncounted, because unknown, are the number of terrorists in the vast numbers of illegal aliens flowing across our borders that escape CBP capture and detention and those among the vast numbers of illegal aliens flowing across our borders undetected.

Nor do we know how many terrorists are among the illegal aliens that CBP does capture but that the Biden administration orders released under President Joe Biden’s (D) Catch and Release program.

Wrong Answer

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The Biden/Regan Environmental Protection Agency has decided to get into individual municipalities’ business.

For the first time in 26 years, the US Environmental Protection Agency has issued new guidelines for drinking water safety. Municipal utilities will be required to install expensive filtration systems to lower the amount of PFAS in water supplies.

The cost of such “guidelines” will run to billions of dollars just for Illinois’ cities, towns, and villages. Multiply that by all the cities, towns, and villages across the US and our territories—the reach of the EPA—and we get a ton of costs.

PFAS (Per- and polyfluoroalkyl substance) and the related PFOS (perfluorooctanesulfonic acid) are chemicals that don’t appear to break down in anything approaching a useful time frame, and they are associated with a variety of cancers. That makes it useful to avoid ingesting them or inflicting them on our environment.

However.

While removal of these chemicals is a good idea, doing that alone and at the end of the production-use-disposal chain will cost the relevant jurisdictions vast sums in perpetuity. Too, after the chemicals are removed from our water supplies—what then? What will we do with those now concentrated perpetual chemicals? Nuclear waste at least breaks down after some, often extended, period of time.

Focusing on developing other materials that don’t require these chemicals, at the beginning of the production-use-disposal chain would be initially expensive and long-term far cheaper. But that wouldn’t maintain EPA power.

“The Fed Got Us Into the SVB Mess”

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That’s the headline on The Wall Street Journal‘s Sunday Letters section. There’s also this from a letter by Desmond Lachman of the American Enterprise Institute:

The real lesson from SVB’s failure is that things break when the Fed is forced to raise interest rates at an unusually rapid rate to regain inflation control.

And this, from another Letter-writer in that section:

…the Fed sowed the seeds of the current crisis as SVB stretched for yield in a zero-interest-rate environment and then failed to manage its duration risk. The Fed’s efforts to micromanage the economy creates unforeseen problems that continue to erupt.

No, and no.

There is much to criticize regarding the Fed’s interest rate moves, but they’re irrelevant to SVB’s and Signature Bank’s failures.

The Fed’s interest rate increases may have been done at an unusually rapid rate, but they still occurred over a period of months—12 of them in fact: the first increase in the current series was way back in March 2022. The Fed’s moves were part of the environment in which these two failed banks operated, nothing more. It was the management teams of two failed banks who failed to deal with the environment in which they operated.

The idea that the Fed’s moves—micromanaging our economy or other moves—created unforeseen problems is risible on its face. Any pupil in a high school economics class knows that bond (and other debt instrument) prices move in the opposite direction from interest rates: as rates rise, existing bond prices fall. SVB’s and Signature’s managers surely are high school graduates; they knew full well that their reserve holdings, held almost entirely in long-term Treasuries and mortgage-backed debt instruments, were falling in value for the entire year that the Fed had been raising interest rates. The failure of these two banks to pay attention to their reserves is entirely and solely the fault of those two banks’ management teams.

Whitewash

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It seems the Federal Reserve knew of the risks stemming from SVB management moves as long ago as 2019 [emphasis added].

In January 2019, the Fed issued a warning to SVB over its risk-management systems, according to a presentation circulated last year to employees of SVB’s venture-capital arm….
The Fed issued what it calls a Matter Requiring Attention, a type of citation that is less severe than an enforcement action. Regulators are supposed to make sure the problem is addressed, but it couldn’t be learned if the Fed held SVB to that standard in 2019.
…
Following the 2019 warning, the Fed informed SVB in 2020 that its system to control risk didn’t meet the expectations for a large financial institution, or a bank holding company with more than $100 billion in assets, the presentation to employees at SVB’s venture-capital arm said.

And:

Over time, the central bank issued numerous warnings to SVB, suggesting the bank’s problems were on the radar of the Fed, the bank’s primary federal regulator.

So, what was done by the Fed’s regulators in response to this string of noncompliances?

A central-bank review of its oversight of SVB is due by May.

Will those prior whitewashes be followed up with an official whitewash?

I’m not holding my breath over a favorable outcome, which IMNSHO would include, at the very least, the public firing for cause of the Fed regulator(s) directly responsible for SVB oversight and that individual’s/team’s supervisor. Pour l’encouragement des autres régulateurs.

Trademark Whining

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Jack Daniels has a trademark beef in front of the Supreme Court.

Phoenix-based VIP Products markets dozens of novelty pet products, including the 18-inch “Bad Spaniels” vinyl toy shaped like a liquor bottle, advertised on its website as “Silly and Fun For Everyone!”

Jack Daniels summarized its beef:

Jack Daniel’s loves dogs and appreciates a good joke as much as anyone. But Jack Daniel’s likes its customers even more, and doesn’t want them confused or associating its fine whiskey with dog poop[.]

This is what a Jack Daniels whiskey bottle looks like:

This is what VIP’s Bad Spaniel chew toy looks like:

Jack Daniels thinks that toy, a dog’s plastic chew toy, looks too much like its own liquor bottles and that its customers would be confused.

It’s interesting and amusing—and maybe insulting its customers—that Jack Daniels thinks its customers would be so easily confused between a liquor bottle and a dog’s chew toy.