What Happened Today: May 05, 2022
Fed’s biggest rate hike since 2000; Ministry of Truth targets opposition; Nevada grass ban
The Big Story
Central bankers at the Federal Reserve launched an offensive on inflation yesterday with the announcement from Fed Chairman Jerome Powell that the bank will raise its benchmark interest rate by a half-point, the largest increase since 2000. In a press conference following his announcement, Powell said the bank could tack on additional half-point increases later this summer if current economic conditions continue. Though such rapid increases haven’t been deployed since the 1980s, the central bank’s roadmap was more dovish than many analysts and bond market speculators anticipated, as the bank is concerned that a higher or faster increase on interest rates could drive the economy into a recession.
Powell will now walk a tightrope as markets obsess over the Fed’s messaging and methods to tame inflation with additional monetary policy tightening. As investors digested Powell’s shift in language yesterday—moving from the “patient” approach toward higher rates he’d previously advocated to a “humble and nimble” strategy—stocks and bonds at first rallied, with the Dow seeing its biggest one-day gain by the close of the market, before plunging today, erasing most of those gains. That kind of volatility could very well be “our new normal here for a bit until the Fed gets inflation under control,” economic analyst John Ingram told The Wall Street Journal today. The Fed’s firm control on inflation won’t come easy: Along with continued supply chain disruptions instigated by the Russian invasion of Ukraine, new Labor Department figures indicate there were roughly two job openings for every unemployed person in March, extending the unusually tight labor market that will push employers to increase wages and invest in expensive recruitment efforts, resulting in higher costs that could further inflame inflation.
Read more: https://www.reuters.com/business/futures-slip-after-fed-driven-rally-wall-street-2022-05-05/
In The Back Pages: A Review of The Seratones’ ‘Love and Algorythms’
The Rest
→ Though some establishment Democrat super PACs had already deemed the midterm Senate race in Ohio too far out of reach even before J.D. Vance rode his Donald Trump endorsement to victory in this week’s primary, the general election showdown in November could nonetheless become a war of the war chests as both candidates try to sway the decisive working class voters. With J.D. Vance already armed to the gills, courtesy of Peter Thiel’s dollars, Puck News reported on Tuesday that Vance’s opponent, the 10-term house member Tim Ryan, could very well become the beneficiary of Reid Hoffman, the Silicon Valley billionaire and major Democratic donor who’s maintained a close friendship with Thiel since college, despite, or even because of, their political differences. Hoffman’s investment behind Ryan would help level the campaign playing field in the key swing state, even after Democratic funders like the Senate Majority Leader Chuck Schumer’s Senate Majority PAC passed over Ohio in favor of five other states with tight races.
→ A 12-year-old boy who was clearly no longer a threat to police was shot and killed in Philadelphia in March, and now the officer who killed him with a bullet to the back is facing charges of first- and third-degree murder after the city’s district attorney, Larry Krasner, announced his decision to prosecute the officer this week. Reviewing video and audio recordings from the scene of the crime that have not yet been made public, the district attorney said the boy had been stopped by police for riding his bike down a one-way street; he or a friend then fired a gun at their car before the officers gave chase. The weapon was tossed to the ground in response to the police officers’ commands, and while the boy got on the ground, “Officer Mendoza fired the … fatal shot,” Krasner said. The death of the boy continues the trend of violent killing that has plagued the city and cast doubt on the effectiveness of Krasner’s office; to date, the city has suffered 157 homicides, though this most recent incident involving a child and firearms marks what appears to be a new, dark chapter in Philadelphia’s decline in safety. “Our shooters are becoming younger, and as such our … shooting victims are becoming younger,” Danielle Outlaw, the city’s police commissioner, said this week. “We’re seeing guns fall into the hands of younger people, juveniles, far more readily.”
→ No need for any more concern about the Department of Homeland Security’s nascent Disinformation Governance Board, which some have worried could become a federal apparatus used by the Democratic majority to censor political opponents or remove unfavorable information from the public square. After the slightly ominous and vaguely worded announcement on Monday that the new advisory board would work to quell extremists and “disinformation spread by foreign states such as Russia, China, and Iran, or other adversaries,” the director of the group, Nina Jankowicz, cleared up any confusion at a talk this week about who those extremist adversaries actually were: “Republicans, and other dis-informers.”
→ The number of international students enrolling in U.S. universities is declining precipitously—a trend that began before the COVID-19 pandemic and has only worsened since. In 2021, fewer than a million international students studied at U.S. institutions—the first time that number has been below a million since 2014—and 15% fewer foreign students matriculated in U.S. programs than during the previous academic year. This poses a deep financial problem for U.S. colleges, which raked in $15 billion in tuition expenses in 2018-19 from Chinese students alone. International students, most of whom pay full tuition, subsidize the education of American students, with one recent Journal of Public Economics study finding that 10 new international students then “leads to eight additional domestic students.” The United States’ loss, meanwhile, appears to be Canada’s gain: “The number of international students from India studying at Canadian colleges and universities increased 182% between 2016 and 2019, while at the same time, the enrollment of Indian students in master’s level science and engineering programs at U.S. universities fell almost 40%,” a study from the National Foundation for American Policy concluded. The most significant cause of this decline is how difficult U.S. immigration laws make it for foreign students to get work visas and green cards following graduation.
→ Three 16th-century synagogues in Venice, their gilded lamps and terrazzo floors grayed by soot, are set to undergo an $11 million renovation that will restore them to their Renaissance grandeur. The synagogues are crammed into the city’s Jewish ghetto, a 1.5-acre area where Jews had been forced to live for most of the 16th, 17th, and 18th centuries. Once home to 5,000 Jews, Venice is now home to 450, and the dwindling community is unable to sustain these historic temples. “These buildings are crying for help,” said David Landau, an art historian and businessman who is overseeing the project. With the $11 million Landau hopes to raise, the rehabilitated synagogues will feature new museum and gallery spaces, offering visitors an opportunity to learn about the first Jewish ghetto in the world and its consecrated places of prayer.
→ Though buying a U.S. home is as hard as it’s been in years, California’s brutal housing market, which Gov. Gavin Newsom last year described as the state’s “existential threat,” is now that much worse: Even all-cash bids a million dollars over the asking price are no guarantee that a buyer will win a competitive auction. More than 70% of all homes went above asking in March—even for homes not at the high end of the spectrum—adding $40,000 to the median price. While rising interest rates don’t help, the main cause of this affordability crisis is the severely limited housing supply and ever-increasing demand. Jordan Levine, the chief economist for the California Association of Realtors, said the state would need to build 180,000 new units per year to keep up with demand; last year the state fell short of that number by 80,000. This discrepancy forces prospective buyers into increasingly fierce bidding wars.
Read more: https://www.bloomberg.com/news/articles/2022-05-03/buying-a-house-in-california-prices-keep-soaring-as-mortgage-rates-rise
→ In yesterday’s Scroll, we reported that the National Park Service is taking unprecedented steps in response to the drought conditions in the western U.S. that threaten the water and energy supply for millions of people. Today, another unprecedented response to the drought: a grass ban in Nevada. In the wake of a law passed last year, water-hungry grass lawns and “nonfunctional” patches of grass across the state must be pulled up, often to be replaced by stone gardens and desert plants. This move, the Southern Nevada Water Authority estimates, will save 9.5 billion gallons of water per year—10% of what the region consumes annually from the Colorado River. Even with this new law, the water level of Lake Mead, which provides Nevada with 90% of its drinking water, is at a record low.
→ Drought conditions have in fact risen to unprecedented levels globally, with every country except Antarctica facing some drought. India, in particular, is facing dire heat conditions, having just experienced its hottest March in 122 years. Crops burned in the 110-degree Fahrenheit weather, and power outages caused by surging demands for electricity—for fans and refrigerators and, for the fortunate 12% of Indians who own them, A/C units—became commonplace across the country, often lasting for as long as eight hours. Increasingly worrisome is India’s “wet-bulb temperature”—a metric that combines heat and humidity levels to indicate how much evaporation can be absorbed into the air. The wet-bulb temperatures in India are rising to a point where people outside “become unable to reduce [their body] temperature via sweating and will suffer potentially fatal heat stroke after only a few hours, even with shade and water,” Bloomberg reported this week. With the relief of the monsoon season still several months away, India is facing a potentially deadly spring.
A Review of The Seratones’ ‘Love and Algorythms’
I always have a place in my heart for bands willing to radically change their sound from album to album. This started for me with Guided by Voices, the everlasting indie rock project helmed by Robert Pollard. Pollard would send a noise project verging on painful into the world, then follow it up with Beatles-esque pop brilliance. Then another thing would come out. The hunt for the next sound became as intriguing as whatever he was putting out next.
I was first introduced to The Seratones in 2014, presumably through some MP3 blog linking to a song. Named after the neurotransmitter serotonin, the Shreveport, Louisiana-based band introduced themselves to the world on their debut, Get Gone, as garage rockers who ferociously mixed punk, jazz, and soul. Controlling the chaos, AJ Haynes had the type of voice that could make somebody stop in their tracks.
She still has that power, and The Seratones are still exploring on their third album, Love and Algorythms. Gone is the pure garage-rock feel, injected with a hearty helping of keyboards and synth. A decidedly electronic turn, Love shows a restless band eager to find out where new sounds will take them.
Opener “Two of a Kind” starts with a little vocal harmony: “Sunset to sunrise / Wish I could see the world through both of your eyes.” The song takes the listener through many rapid interactions: Here’s Berlin, there’s a bed. The only consistency lies in song: “What song is repeating in your head / Keeping you up in your bed?” Haynes asks. And then the keyboards of Tyran Coker take over, creating a smooth synthwave exploration.
Some of the fare is decidedly pointed, urging people to get offline. But The Seratones make the request with a spoonful of sugar. “Good Day” is bouncy and lighter than air, encouraging the listener to finally turn off their phone. The song feels like it could be in the background of a Netflix show, the soundtrack of a montage in which a character finally gets their life together. On “Get Free,” Haynes invokes both Fannie Lou Hamer and Rage Against The Machine with a deep funk groove.
The album’s title track is another one of the highlights. One of the album’s more stripped-back songs, it works more off a vibe than any particular idea. Overwhelmed by emotion, the protagonist finds refuge in chemicals. Not exactly new territory for a song, but the singer finds themselves caught in the middle between “love and algorithm,” without ever explaining what that means. It’s an easy chorus to get lost in as you hear the three words repeat again and again over the keyboards.
“Tell me about this algorithmic love / inside me,” Haynes asks over and over again. Given how our feeds so artfully set our desires these days, she can’t be the only one asking.
David Grossman is a freelance writer based out of Brooklyn and is on Twitter at @davidgross_man.
Thank you for your good work! And it’s good to know that raising interest rates, which makes me poorer, is a way to lower inflation? Or something like that…………..