Author: VD

Corona-chan + Qanon

It’s the dream team that can’t be beat by the Big Tech Cartel:

The Covid-19 pandemic has only helped the movement expand: Hundreds of thousands of people with nothing else to do have been exposed to the fringe fulminations. The Institute for Strategic Dialogue (ISD), a London think tank, says that from March through June, QAnon-related posts surged on Facebook and Twitter. While its believers were far from the only ones trying to discredit the use of masks or cast doubt on vaccines, they were among the largest groups.

Twitter took action on July 21, announcing measures targeting “so-called ‘QAnon’ activity” across its platform. “We’ve been clear that we will take strong enforcement action on behavior that has the potential to lead to offline harm,” the company tweeted as it detailed the crackdown. Twitter is suspending accounts for breaking existing rules and will no longer highlight as “trending” or recommend content and accounts associated with QAnon. It will also try to stop the movement from being played up in search. Users will no longer be able to share URLs associated with it.

Twitter’s plan has parallels with an earlier crackdown by Reddit in 2018 after its forums became QAnon hotbeds. The most prominent subreddits associated with the movement came down, and new ones even hinting they had something to do with it could not be created. Reddit’s move is considered to be among the more significant blows against QAnon.

But the tactics so effective on Reddit in 2018 may not work for Twitter. The QAnon movement is now a very different beast from the one that used to populate now-deleted subreddits such as r/TheGreatAwakening.

It’s really rather remarkable that the most reliably dishonest group of people in the West have the nerve to try to silence millions of people on the purported basis of passing on misinformation. But then, they seem to regard hubris as a virtue. If they were actually members of Western civilization, or even understood anything at all about Western philosophy, they would know that Nemesis always makes an appearance, sooner or later.

And since “free speech” has turned out to be a literally Satanic lie, the only interventions that are actually required are Crusade and Inquisition.

Perhaps The Storm is upon us, perhaps it isn’t. But the Prometheans are obviously afraid of something.

“The poop is everywhere!”

Lawyer and YouTuber Viva Frei acquired a complete copy of the original backer arbitration claims – courtesy of the Norton Law Firm – and analyzes them as well as the judge’s final ruling on the preliminary injunction:

And there you have it, a thorough update and breakdown of the Patreon lawsuit and a further illustration of the fact that when you’ve stepped in poop, sometimes the best thing to do is stop walking around and tracking it everywhere. Patreon definitely stepped in poop, and by the way of their highly-questionable amendment after the fact to try to undo their own mistake, I think they have just tracked poo-poo all over their house, in their bedroom, in their bed, on their pillowcase… the poop is everywhere!

He was clearly impressed by the case constructed by the LLoE, as he described it as “very intelligent” and even “genius”. And this didn’t even begin to get into the poop-tracking accomplished by the filing of the lawsuit and its inevitable consequences in the form of the amended claims by the 72 Bears being sued.

Interesting….

The God-Emperor seems to be strangely disinterested in the campaign trail:

Remarks made by President Trump during a speech have prompted speculation after he referred to having a lot of rich enemies and told the audience, “This may be the last time you’ll see me for a while.”

“So I have a lot of enemies out there. This may be the last time you’ll see me for a while. A lot of very, very rich enemies, but they are not happy with what I’m doing,” said Trump. “But I figure we have one chance to do it, and no other President is going to do what I do. No other President would do a favored nations, a rebate, a buy from other nations at much less cost. Nobody. And there are a lot of unhappy people, and they’re very rich people, and they’re very unhappy,” he added.

There are also hints and indications that something long-anticipated might be in the air. Stay tuned.

This won’t age well

The Economist makes its predictions for November:

Chance of winning the electoral college:
Biden 91{4e01b0bc4ab012654d0c5016d8cbf558644ab2e53259aa2c40b66b3b20e8967d}
Trump 9{4e01b0bc4ab012654d0c5016d8cbf558644ab2e53259aa2c40b66b3b20e8967d}

Chance of winning the most votes:
Biden 98{4e01b0bc4ab012654d0c5016d8cbf558644ab2e53259aa2c40b66b3b20e8967d}
Trump 2{4e01b0bc4ab012654d0c5016d8cbf558644ab2e53259aa2c40b66b3b20e8967d}

Estimated electoral college votes:
Biden 357
Trump 181

Just wanted to make sure we preserved it for the record.

Tortious interference in California

I have to admit, I initially assumed that Patreon was unexpectedly handed an advantage on at least one of the outstanding issues by a ruling from the California Supreme Court this week:

California recognizes two different torts involving interference with economic relations – interference with performance of a contract and interference with prospective economic advantage.  Originally California courts treated these two torts as essentially the same, the the only difference being that interference with contractual relations required the existence of a binding contract.  In 1995, however, the Supreme Court held that a plaintiff pursuing a claim for interference with a prospective contractual or economic relationship had to plead that the defendant’s conduct was wrongful.  Della Penna v. Toyota Motor Sales U.S.A., Inc., 11 Cal. 4th 376 (1995).

Contracts that are terminable at-will occupy a sort of middle estate between these two torts, leading to the question of whether a plaintiff pursuing a claim for tortious interference with an at-will contract must plead that the interference was independently wrongful.  Yesterday, the California Supreme Court held that tortious interference with an at-will contract does require independent wrongfulness. Ixchel Pharma, LLC v. Biogen, Inc., 2020 Cal. LEXIS 4876.

Although the Court recognized that in an at-will contract the parties have more of an expectation of continuity of the relationship than when no contract exists, it found that there is no legal basis in either case to expect continuity from the perspective of a third-party.  The Court also found that legitimate business competition could be chilled if independent wrongfulness is not required.

As I commented on SocialGalactic, this particular decision by the California Supreme Court looked unfavorable to Big Bear on first glance, as well as almost comically untimely. However, it did at least serve to demonstrate that his case was very far from frivolous, considering that the court appeared to be addressing, for the first time, one of the primary issues at dispute in his arbitration.

Upon the LLOE’s review of the ruling, however, it quickly became apparent that despite its apparent relevance to his case, the Ixchel decision actually has nothing to do with Big Bear’s claim for tortious interference on the part of Patreon. This is for four reasons:

  1. As defined by the supreme court, an at-will contract requires mutual bargaining by the parties. The Patreon Terms of Use are a contract of adhesion that prevents bargaining and is unilaterally imposed upon one party by the other, so they are not an at-will contract.
  2. An at-will contract is, by definition, terminable at will by either party. The Patreon Terms of Use cannot be terminated by the user. Even if a user deletes his account, he remains bound indefinitely by the terms. So, again, the Patreon Terms of Use are not an at-will contract.
  3. Patreon did not terminate its contract with Big Bear or even delete his account. What they did was delete his creator page, deny his access to the platform, and prevent patrons from paying him.
  4. The Ixchel decision is not analogous to Patreon’s contract with Big Bear, but with Big Bear’s separate contractual relationships with his patrons.
It’s important to avoid confusing the user’s account with the contract between the two parties. They are two very different things. But the CA Supreme Court’s decision did add a little excitement and drama to what is otherwise an incredibly boring process, so that was fun.

The Silicon Curtain

President Trump opens a new offensive in the trade war:

President Donald Trump has issued executive orders effectively banning Chinese video sharing app TikTok and messaging service WeChat in a dramatic escalation of tensions with Beijing that sent stocks tumbling worldwide overnight.

Using national emergency powers, Trump on Thursday night signed the orders, which give TikTok parent ByteDance 45 days to sell the app, and bar WeChat from the U.S. after the same time period.

The orders also banned any U.S. transactions with WeChat owner Tencent, a major Chinese company that owns significant shares in Tesla, Snap Inc, and Reddit. Tencent shares fell as much as 10 percent in Asian markets overnight, and it was not immediately clear whether the company would be forced to divest its U.S. holdings.

Coming days after the United States ordered China to vacate its consulate in Houston, the move looks set to trigger retaliatory action by Beijing, stoking fears that a ‘Silicon Curtain’ is descending between the two superpowers. It raised the possibility that Beijing could retaliate by banning major U.S. tech companies from China, a major market for some of the top American firms.

‘China could block Apple or Microsoft from China. The information sector growingly looks divided into two camps. We could be seeing just the beginning of an information technology war,’ said Nana Otsuki, chief analyst at Monex Securities.

‘Investors in the West would have to hesitate to invest in China, missing growth opportunities there when there are not many investment opportunities except perhaps except for Nasdaq.’

Although this will tend to help the God-Emperor’s enemies in Silicon Valley fend off what would likely be a successful foray into the US market by Chinese technology companies, it’s the right thing to do in the long term. China has successfully defended and developed its technology sector, now it is time for Americans to free the US technology sector from the grip of the bad and mostly foreign actors who presently control it.

But this isn’t even the big news on the trade war front, as the report released yesterday by the President’s Working Group on Financial Markets appears likely to drive even more significant changes:

In response to President Trump’s June 4 Memorandum on Protecting United States Investors from Significant Risks from Chinese Companies, the President’s Working Group on Financial Markets (PWG) today released a report making five recommendations.  These recommendations are designed to address risks to investors in U.S. financial markets posed by the Chinese government’s failure to allow audit firms that are registered with the Public Company Accounting Oversight Board (PCAOB) to comply with U.S. securities laws and investor protection requirements.

“The PWG examined the risks to investors posed by the Chinese government’s failure to allow access.  The PWG unanimously recommends that the Securities and Exchange Commission take steps to enhance the listing standards on U.S. exchanges for access to audit work papers, among other recommendations,” said Secretary Steven T. Mnuchin, Chairman of the PWG.  “The recommendations outlined in the report will increase investor protection and level the playing field for all companies listed on U.S. exchanges.  The United States is the premier jurisdiction in the world for raising capital, and we will not compromise on the core principles that underpin investor confidence in our capital markets.”

The PWG recommends that the SEC take steps to implement the five recommendations outlined in the report.  In particular, to address companies from jurisdictions, such as China, that do not provide the PCAOB with sufficient access to fulfill its statutory mandate (“Non-Cooperating Jurisdictions,” or “NCJs”), the PWG recommends enhanced listing standards on U.S. exchanges.  This would require, as a condition to initial and continued exchange listing, PCAOB access to work papers of the principal audit firm for the audit of the listed company.

Translation: Chinese companies are not providing the US financial authorities the ability to audit their books.  The US government is now making it clear that any companies using auditors who are not subject to PCAOB oversight will not be permitted the ability to list or remain listed on US exchanges. So, this could lead to a mass exodus of US-listed Chinese companies from the US markets.

Urgent!

An SOS call goes out from the hive:

Urgent Message! Unauthorized cultists are on a mass flagging campaign to shut down our counter narrative. Accounts are getting suspended/deleted. Please keep your wits about things as we continue to fight. I’m working on setting up an off-site backup.

Oh dear, someone is using their tactics against them? How unfortunate!

A Mythology for England

What did Tolkien mean when he told Milton Waldman that he wanted to write “a body of more or less connected legend” that he could dedicate “to England,” sketching it in part, while leaving “scope for other minds and hands, wielding paint and music and drama”? In this episode, Professor Rachel Fulton Brown talks about Tolkien’s understanding of mythology and its relationship to the country, as well as what it means to take up his invitation to participate in this story-telling, and why it is a fundamentally Christian exercise to write fan fiction within Tolkien’s legendarium.

Episode 2 of The Forge of Tolkien, A MYTHOLOGY FOR ENGLAND, is now available for subscribers on Unauthorized. You can also support the video series with a subscription.

Professor Brown introduces the lecture series on her blog, Fencing Bear at Prayer:

I first read The Lord of the Rings when I was eleven. My mother gave me the boxed set for Christmas, and I read all four books in one trip to our grandparents’ house by New Year’s. Imagine my 11-year-old self struggling with the hobbits across Middle-earth as my mother drove us across the middle of America from Kentucky to Texas (and back again), and you will get some sense of the effect that it had on me.

Of all the things that drew me to become a medieval historian, reading (and re-reading, and re-reading, and re-reading) Tolkien is at the top of the list, although it took me decades to admit it. Tolkien lived in my imagination somewhere between stories I remembered reading as a child and my first (magical) visit to England with a school trip in high school—not really real, certainly not the stuff of serious scholarship.

Latin and Chartres drew me to study the history of medieval Christianity, not elves, hobbits and dwarves.

Or so I told myself.

That very boxed set was my favorite Christmas present too, after I was introduced to The Lord of the Rings at a similar age.

The death of the Devil Mouse

Their losses are not only accumulating, they are accelerating. Which is more than a little fascinating in light of what I wrote in Corporate Cancer concerning the Devil Mouse.

Debt, diversity, and the Devil Mouse

Investors often say that which cannot continue will not. But as one influential economist who was also a highly successful investor noted, “the market can stay irrational longer than you can stay solvent.” So, we can’t expect to know exactly when a converged company is going to succumb to the corporate cancer that has infested it. There is an awful lot of ruin in companies as big and resource-rich as Apple, Disney, Google, Intel, or Microsoft; a single disaster, or even a single series of disasters is probably not going to be sufficient to do them in.

But if the precise end of a converged company cannot be foreseen, the beginning of the endgame often can be. This is because a corporate failure cascade, or a process in a system of interconnected parts in which the failure of one or more parts triggers the failure of other parts, is often observable by even casual observers.

For example, Disney looks indomitable when seen from a distance. It has a market capitalization of nearly $250 billion and in 2018 reported an annual profit of $12.6 billion on $59.4 billion in revenue. It owns a veritable gold mine of intellectual property, from Mickey Mouse to Star Wars, and is arguably the most formidable entertainment empire in the history of the world to date.

But look a little closer and a less imposing picture begins to take form. In just the last year, Disney’s debt has increased by $38 billion, to a total of $53 billion now owed. And while that figure is considered low by industry standards, it has amassed that gargantuan debt to pay for projects that are already failing at an rate that is extremely uncharacteristic of historical Disney projects.

Consider, too, that Netflix now owes $12.4 billion in debt with $15.8 billion in annual revenue, so despite Disney’s low debt/equity ratio of 0.38, it has a debt/revenue rate of 89.2 percent, which is actually higher than the notoriously unstable Netflix’s 78.4 percent.

Star Wars isn’t the only one of Disney’s once-dominant properties and franchises that are failing. The two Galaxy’s Edge theme parks were failures at launch, attendance is declining at both its flagship parks, and ESPN has been losing two million subscribers a year for the last seven years.

Although it has ridden the Marvel Cinematic Universe—which it did not create—to record-breaking box office heights, its attempt to mine its rich cartoon franchise for live action films has not panned out very well when corrected for inflation—the 1994 Lion King made $178 million more than its 2019 remake—and its attempts to create new franchises that can be similarly exploited have repeatedly failed.

On the other hand, Disney is still generating mammoth profits, its seemingly endless series of remakes are profitable, and the launch of its new Disney+ streaming channel could lead to a whole new period of growth for the entertainment giant. Then again, the decision to retroactively censor old films from Song of the South to Dumbo and The Lady and the Tramp tends to suggest that convergence will cause Disney+ to disappoint too.

In the end, it is probable CEO Bob Iger’s declaration that the corporation’s push for more diversity in its entertainment products will be followed by an increase of diversity in its executive suite before he retires that will prove the most reliable guide for the future of Disney as well as a test of the central thesis of this book.

There are only three possibilities, after all. Either social justice convergence is beneficial for business, it is harmful for business, or it is irrelevant. And at this point, it should be eminently clear that is about as good for the average corporation as cancer.

Are we seeing the beginning of a series of convergence-related failure cascades across corporate America? Disney may prove to be a useful harbinger in this regard.

Remember, that was all written before Corona-chan devastated Disney’s vital parks business. So let’s look at what is happening of late on the Devil Mouse front:

Analyst Rich Greenfield recently looked at Disney and ESPN’s reports and found very troubling numbers for the sport network and its parent company. ESPN’s loss in subscribers is also shocking for its size. The loss of subscribers continues and is down another six percent year-over-year. So far, this year’s subscriber loss has accelerated over past years. The sports network was down 4.5 percent in the first quarter, off 5.5 percent in the second quarter, and down a whopping 6 percent in the third quarter. Indeed, the six percent decline ESPN saw in the third quarter this year is just part of the declines suffered in every quarter at since the third quarter of 2016.

ESPN+ ARPU down 22{4e01b0bc4ab012654d0c5016d8cbf558644ab2e53259aa2c40b66b3b20e8967d} year-over-year, as it is basically being given away within the Disney/Hulu/ESPN+ bundle. $4.18 vs. $5.33 last year. How do you make money at $4.18 of $ARPU? 

That 6-percent Q3 decline suggests that ESPN will be down to 78 million subscribers by the end of the year, down from 99 million in 2013. It certainly looks like a corporate failure cascade in progress. And while there is a LOT of ruin in the Devil Mouse, the speed at which its debt is accumulating means that it might not take as long as you would assume for that debt to become unserviceable. I haven’t run the numbers yet, so I don’t know how long it might take to go critical, but the fact that Disney is already running a higher debt/revenue ratio than Netflix is an ominous indicator.