The pandemic and black-owned businesses

ProPublica: How the Pandemic Economy Could Wipe Out a Generation of Black-Owned Businesses

Several times on this blog I criticized ProPublica's smear campaign against TurboTax and other makers of software for filing income taxes. ProPublica accused TurboTax especially of  "bait and switch", luring customers to file for free and then getting them to pay for another version of TurboTax after the customers find out they don't qualify for filing with TurboTax's free version. (There were also two versions of TurboTax that used "free" which probably confused some people.) Searching for "TurboTax" on this blog yields several such posts, most in May 2019 and the first quarter of 2020. 

It's widely known that the pandemic has affected black and Hispanic employees more than others, because so many of them work in the kind of jobs hit hardest by the the pandemic, like in restaurants and hotels and jobs involving close personal contact such as nursing homes and home health care. This ProPublica article about the pandemic's effect on black-owned businesses by Lydia DePillis tells the story with the example of a woman, Danette Wilder, whose business makes O-rings used in aerospace, medical and other industries. I admire Wilder's apparent competence and grit in business. She has faced hard times and is still standing. 

However, hard times are not limited to black-owned businesses. The between-the-lines message of this ProPublica article seems to be that Wilder has faced harder times because she is black. DePillis cites a statistical disparity favoring her opinion. "According to the Census Bureau, in 2012, 6,269 out of 7,032 manufacturing firms in Kentucky were white-owned, while 122 were owned by Black people." 7,032 - 6,269 - 122 = 641. Firstly, that was nine years ago, so there may be less disparity in more current numbers. Anyway, the numbers suggest 641 were Asian, Hispanic or other. According to this page, Kentucky's population is 8% Black, 4% Hispanic, 2% Asian, and 2% Multiple Races. Thus in the population Blacks number about the same as Hispanic + Asian + Multiple Races. 122/641 = 0.19 or 122/(641+122) = 0.16.  Thus Blacks seem to be underrepresented among owners of manufacturing firms. Whether or not that is due to racial discrimination is an open question in my opinion. There are many possible reasons. Suppose Asians are under-represented among owners of quick oil change businesses, McDonald's franchises, or yard maintenance companies. Are those statistical disparities due to racial discrimination, too? 

It thus seems that DePillis used Ibram X. Kendi's ploy: Whenever and wherever there is a statistical disparity, it is due to racism. Regardless of the real traits of those accused of racism, such traits are not relevant. The accused are automatically and subconsciously guilty.

U.S. federal government interest payments

The Committee for a Responsible Federal Budget asks: How High Are Federal Interest Payments?

It will be about $300 billion this year. The amount of U.S. federal debt is $28 trillion. So the average interest rate paid on that debt is $300 billion/$28 trillion = 1.07%. In the early 1980s the aggregate or average interest rate on Treasury securities was over 8%. Interest rates on new 30-year bonds exceeded 14%, and rates on short-term issues exceeded 17%. Reaching an aggregate 8% again seems very improbable, but reaching 3% or 4% is not. Of course, reaching 3% or 4% instead of the current 1% implies the federal government's interest payments would triple or quadruple, and this would put pressure on other federal government spending. That's except to those unconcerned about deficits and debt, which includes the majority of politicians and bureaucrats.

Page 24 here shows (as of 6 months ago) when Treasury securities mature (and will be replaced by new issues).  Most mature within 5 years, so the aggregate interest rate will lag a rise of interest rates on new issues, but not for a long time (unlike all securities being long-dated).  

The graph on this page shows how the yield on 10-year Treasury bonds have risen this year from about 0.9% to 1.6%

GameStop stock price soars again

Apparently the fat lady hasn't sung yet. 😊

Yahoo/Bloomberg: ‘Reddit Raider’ Favorite GameStop Soars on Latest Cohen Push

"GameStop Corp. mania was reignited Monday after the video-game retailer tapped Chewy Inc. founder and activist investor Ryan Cohen to helm its e-commerce business shift."

Of course, there are contrary opinions about what that news portends for the stock price. 

After the two spikes in January, the price of GameStop stock stayed in a range of about $40-$60 during most of February. Since then the price has more than tripled ($194.50 at yesterday’s close) and today’s pre-market points even higher ($227 at 9:05 a.m.). See the graph here and click on YTD for Jan. 1 - Mar. 9.

Voting rights bill H.R. 1

The Democrats’ voting rights bill is an assault on election integrity

The Washington Compost's op-eds are mostly leftist, but there are a few to the contrary. The above by Henry Olsen is one of them.

"The bill’s primary danger lies in its virtual abolition of any safeguards to ensure that a vote represents the true desire of a single, eligible voter. States would be effectively barred from mandating the use of a photo-ID to establish that a person is the registered voter they claim to be, instead permitting a prospective voter to merely sign a sworn affidavit. States would also be required to adopt same-day voter registration in federal elections, even during early voting, so that a person could show up at a poll, sign a registration form and cast a vote without any checks to ensure the person was actually eligible to vote."

The effect is an an open invitation to (what should be) fraud -- one person can vote many times using multiple identities. It's one thing for P1 to persuade P2 how to vote. P1 voting using P2's identity -- especially if P2 is unwilling to even make the effort to vote -- is very different. It a violation of the principle of one person - one vote. Too many Democrats don't care about this principle. Winning is the primary goal; how it's done matters far less.  

Joe Biden is using his bully-pulpit to push this agenda (link).

See the section titled "The Election Bills: HR 1, the Save Democracy Act, and the Carter/Baker Commission" here for more details about the content of HR 1.

Dem Duo Deem to Destroy Democracy

Killing The SAT Means Hurting Minorities

The Weekly Dish: Killing The SAT Means Hurting Minorities

"The evidence is clear. But the woke refuse to accept it."

"The rationale for the SAT abolition movement is — surprise! — critical theory, which insists that any measurement that results in different outcomes among ethnic or racial groups is a priori racist. (Except for all cases when non-whites and non-Asians do better than whites or Asians, in which case, never mind.)"

"[This] argument is pure Ibram X. Kendi: the results are solely and exclusively what determines if a test is racist." Me: If there is any statistical disparity, it is due to somebody's "racism," whether or not that somebody admits it or even recognizes it as racist.

"There is no countering this argument because it is not an argument. It is a threat."

Cryptocurrency outlook #4

Joe Biden picks Gary Gensler as SEC Chair. Fox Business and Bitcoin.com comment on the possible effects on government regulation of Bitcoin and other cryptocurrencies. 

Fox: "If bitcoin and other cryptocurrencies were deemed to be securities, they would fall under the purview of the SEC. Exchanges that facilitate the trading of such cryptocurrencies would also need to have the appropriate investor protections in place," Gensler said (my bold).

"He pointed to improvements in the areas of payments systems, trade finance, and medical-records technology as areas where blockchain has proven useful. Gensler is currently a professor at the Massachusetts Institute of Technology and teaches about blockchain."

Bitcoin.com: Gensler clarified: “To the extent that somebody is offering an investment contract or security that’s under the SEC’s remit, and they have exchanges that operate there, then we have to make sure there’s investor protection” (my bold).

On the other hand, “If it’s not that, and it’s a commodity, as bitcoin has been deemed to be, then it’s either a question for Congress … or it’s possibly a question for the Commodity Futures Trading Commission,” he described (my bold).

Furthermore, the professor also said that the SEC must ensure that crypto markets “are free of fraud and manipulation.”

This is an example of whether or not x falls under the concept X in the context of government regulation. Whether it does or not can have significant consequences. Maybe x falls under both. For cryptocurrencies there is one concept - investment contract or security - for the SEC and another - commodity - for the Commodity Futures Trading Commission. 

Cryptocurrency outlook #3

Bitcoin is at a tipping point and could become 'currency of choice' for global trade, Citi says

https://www.theblockcrypto.com/post/96599/bitcoin-international-trade-currency-citi

“A focus on global reach and neutrality could see bitcoin become an international trade currency. This would take advantage of bitcoin’s decentralized and borderless design, its lack of foreign exchange exposure, its speed and cost advantage in moving money, the security of its payments, and its traceability.”