Linking ≠ endorsement.
⇧ Toxic Loans Around the World Weigh on Global Growth – The New York Times
… it’s not just China. Wherever governments and central banks unleashed aggressive stimulus policies in recent years, a toxic debt hangover has followed. In the United States, it took many months for mortgage defaults to fall after the most recent housing bust — and energy companies are struggling to pay off the cheap money that they borrowed to pile into the shale boom.
… drawback of delaying the cleanup is that the banks remain wounded and reluctant to lend, damping any recovery that takes place. Japan, economists say, waited far too long after its credit boom of the 1980s to force its banks to recognize huge losses — and the economy suffered for years after as a result.
… Ms. Chu estimates that at the end of 2016, as much as 22 percent of the Chinese financial system’s loans and assets will be “nonperforming,” a banking industry term used to describe when a borrower has fallen behind on payments or is stressed in ways that make full repayment unlikely. In dollar terms, that works out to $6.6 trillion of troubled loans and assets.
After a previous credit boom in the 1990s, the Chinese government provided financial support to help clean up the country’s banks. But the cost of similar interventions today could be dauntingly high given the size of the latest credit boom. And more immediately, rising bad debts could crimp lending to strong companies, undermining economic growth in the process.
“My sense is that the Chinese policy makers seem like a deer in the headlights,” Mr. Balding said. “They really don’t know what to do.”
Okay, but let’s differentiate between the impact of reckless deregulation versus fiscal stimulus. It was the former that primarily caused the Great Recession, and it was the latter that mostly saved the US from a deeper depression. That said, lowering lending standards is generally a very bad idea. The standards are tightened and then, seemingly invariably, reduced to below what’s reasonable, given our economic and financial history.
⇧ Wages Rise as U.S. Unemployment Rate Falls Below 5% – The New York Times
Nelson D. Schwartz:
Is the American worker finally getting a raise?
After years of scant real gains despite steadily falling unemployment and healthy hiring, wages picked up significantly last month, a sign the job market could be tightening enough to force companies to pay more to attract and retain employees.
The half a percentage point increase in average hourly earnings in January was the brightest spot in a generally positive Labor Department report on Friday, which showed job creation slowing from the white-hot pace of late 2015 even as the unemployment rate fell to an eight-year low of 4.9 percent.
The last six months were the best extended period for employee paychecks since the recovery began six-and-a-half years ago.
“… wages picked up significantly last month ….” I think that’s overstating it.
An increase in the minimum wage in more than a dozen states at the beginning of 2016 may also be giving hourly earnings an extra tailwind.
⇧ Wage Growth Is Weak. Inflation-Adjusted Wage Growth Is Much Healthier – Real Time Economics – WSJ
This is a good follow-up to the linked article immediately above.
… people’s paychecks are growing slowly, but their inflation-adjusted paychecks have been growing at a clip that may even be considered healthy.
⇧ Was there ever a time when so few people controlled so much wealth?
If we can clearly identify how decisions taken by governments around taxation or financial regulation, for example, have facilitated rising wealth inequality, then we can be ever more certain that society has the potential to change this. Knowing the factors that continue to drive inequality today — and the myths which claim the world must inevitably be this way — means we can also challenge it.
⇧ Why conservative South Carolina could actually be a sign of the future of U.S. energy – The Washington Post
What makes South Carolina notable, aside from its historically conservative stance on energy development, is the fact that its negotiations on oil and wind development are taking place at the same time. Coupled with the state’s recent expansion of solar power, the increasingly passionate energy debate in South Carolina points to a shift in public opinion that may mirror evolving attitudes toward alternative energy in the country as a whole.
⇧ Taiwan earthquake zone transformed into virtual reality model
⇧ How sky-high rents are affecting Hong Kongers | Asia | DW COM
What a mess:
Housing in the city has become severely unaffordable for most locals, a new study finds. Experts say the trend is having a major impact on Hong Kongers’ lifestyle choices, particularly those of younger generations.
⇧ Privatizing water utilities poses dangers for public
The privatization of water is a dangerous trend. We have to act to stop it and to bolster public accountability, control and access before any more Flints happen anywhere.
I completely agree that the privatization of water is dangerous.
⇧ Cleared rainforest bounces back faster than thought – study | Climate Home – climate change news
After 20 years of recovery, secondary forests on average stored CO2 at a rate 11 times higher than untouched Amazonian jungle, the Smithsonian Tropical Research Institute revealed on Wednesday. Moist forests in Central America bounced back quicker than drier sites in Mexico and north-east Brazil.
“Regenerating secondary forests could play a critical role in carbon sequestration ….
⇧ Drought may become status quo in Southwest – Modern Readers
California residents struggling through a sheer lack of rainfall and an interminable drought may be in for more of the same, according to a new study.
⇧ ‘Wrong type of trees’ in Europe increased global warming – BBC News
Conifers like pines and spruce are generally darker and absorb more heat than species such as oak and birch.
⇧ Conflicting Economic Indicators Challenge Fed’s Policy Makers – The New York Times
“My message to the Fed regarding this recent, long-awaited acceleration in wages is ‘Love it and leave it alone,’??” said Jared Bernstein, an economist at the Center on Budget and Policy Priorities who previously served as the chief economic adviser to Vice President Joseph R. Biden Jr. “If we want working people to benefit from the expansion, the last thing you’d want to do is tap the brakes — especially given the absence of inflationary pressures.”
Exactly! However, the Fed wants the banks to make more in interest.
⇧ As China’s economy unravels, Beijing’s attempts at damage control are growing increasingly desperate – Quartz
No longer able to convince the world it’s got China’s economy under control, the government in Beijing is now trying to bully it instead.
“If we see another year of inaction and highly inefficient policy-making, people will continue to become more pessimistic,” Liu said, and “calls for China’s hard landing will become stronger and stronger.” This time, the forecasters may be right.
I agree with much of the article, especially the “Child-like and evil” observation, which I’ve made before; however, I don’t agree with the article’s prescriptions.
Economic reforms are always mentioned but never democratic. More than anything else within the realm of the mundanely doable, China needs real, full democracy.
⇧ Solid Jobs Report Keeps Fed In Play – Tim Duy’s Fed Watch
They fear that if they delay additional tightening, they will pass the point of no return in which they are forced to abandon their doctrine of gradualism.
Yes, and abandoning it would be the right thing to do.
Also, I think people are assuming that a little increase in wages has to be the beginning of a trend. It doesn’t. It may be, but it remains to be seen.
⇧ We asked 6 political scientists if Bernie Sanders would have a shot in a general election – Vox
Okay, I’m putting on my political-scientist and insurance-broker combination hat here. I’m doing so not so much to “politically campaign” for or against this or that but really to counter bad memes in general (whether from the left or right) and mostly for the sake of solid risk-management both domestically and globally.
So, they want you to believe that Bernie Sanders would be easy to beat in a general election because fearmongers would point out that you might lose your expensive health-insurance coverage. Well, please, people are afraid of losing what they have over taking risks to get what they don’t have. That, however, is a very complicated dynamic where the variables include many, many things often overlooked in political-science methodology simply because of funding and other constraints and because the possibilities simply didn’t, or don’t, occur to the researchers and no matter how long they’ve been at it. The fact though is that people also stand to lose what they have that they don’t want: hassle, stress, confusion, rejection, etc., that goes along with much in the health-insurance industry. A great deal of all those negatives would be reduced and potentially eliminated by single-payer coverage.
“The long-term gains of reducing national health spending and increasing [reducing increases in] overall insurance rates would be abstract gains for many voters, and thus hard to sell against the fear of loss.” That is tantamount to saying that the American voters are all too stupid to be able to comprehend. However, where’s the study showing how people view it right now? Most voters were already sold on single-payer. It was politicians who kept it off the table and who went for Obamacare to save the private health-insurance industry. Even the Public Option wasn’t allowed. President Obama didn’t fight for single-payer even slightly and not because it wouldn’t have been popular (it was already way up in the polls) but because of his ideological weaknesses. His ideology isn’t nearly as firm as is Bernie Sanders’.
What other negatives do the people have that they’d lose? How about student debts? What would it benefit the fearmongers to say to the youth and their parents that voters would risk losing their college debts? It wouldn’t gain those fearmongers a thing. Obviously, fearmongering cuts both ways. How about gaining free college at no cost/loss?
What about the once third rail of American politics, Social Security? Neoliberal economics has made such a huge mess of the economy that most youth don’t even think they’ll be getting their SS benefits when the time comes. Therefore, privatizing it almost seems moot to them. What a shame that is. They’ve been feeling that way not because they’re too stupid to grasp what’s happened but because they HAVE grasped it. That’s why they like Sanders so much. He wants to put a stop to all that’s been draining the life blood out of the US economy. So what do the voters stand to lose under a “centrist” candidate here? They stand to lose what they thought had already been lost but that they know could be politically and ideologically regained with no risk to them at all. You mean that with someone such as Bernie (and progressives in Congress due to Bernie’s coattails) we could actually stop thinking we won’t get our SS benefits? Yep. You mean that with Hillary, who’s been very cozy with Wall Street privatizers for decades, that we risk SS? You decide.
While we’re at it, how about what people risk losing by going with the ostensibly centrist candidate, not that Bernie Sanders is really advocating anything more than old-fashioned FDR liberalism? Hillary Clinton is the alternative here for the Democratic nomination. She favors no labeling of GMOs. Strikingly, she advocates an American-instigated-and-enforced no-fly zone over Syria. Are we interested in risking losing the planet via global thermonuclear war? The Vox article brings up Goldwater’s huge lost to Johnson (arguably the most domestically leftist President next to FDR). Well, Goldwater was really sunk by one TV ad showing a mushroom cloud because Goldwater was seen as too willing to use nuclear weapons to win the war in Vietnam. Whether Barry would have done it is completely beside the point. Hillary has a track record of having supported all manner of bad military choices that have only made the world worse rather than safer and more secure. What do we have to lose? Bernie’s not a pacifist, but he’s certainly less reckless in general.
The Vox article pooh-poohs advanced polling about general-election matchups, but Hillary is a very well-known commodity where such polling has much more meaning. Her baggage is well-worn, and she’s only been adding to it what with her private email-server and her pretending not to know that the US was involved in funneling weapons from Libya through Turkey to Syrian so-called moderates who were in fact known to US intelligence to be al Qaeda affiliates. The Republicans won’t focus on that latter aspect but will hammer on the email server, which argument has gained traction even among Democrats who see Hillary as having carved out a legal exception for herself by having that private server that she used in an official capacity (though she’s tried and failed to deny it).
As for the rest of the Vox article and the article in general, I don’t see it as well-argued at all but rather cherry picking at best. I mentioned FDR above, who wasn’t even mentioned in that article. Jeff Stein, the author, doesn’t appear to understand, or doesn’t want to, that Goldwater and McGovern are not statistically significant. The population size of the data isn’t large enough to draw meaningful statistical conclusions. Any political scientist worth his or her salt will know it and say it.
Besides the invisible elephant in the room (FDR), there’re also the hugely important issues of behavioral politics and the Internet. So, we have FDR, who advocated things no less radical than Sanders is advocating now and who, FDR, was elected and reelected more than any other US president. We also have the fact that both Goldwater and McGovern made large strategic errors that Bernie Sanders will likely not duplicate in magnitude (though there is no guarantee that any candidate will run a flawless campaign; which one has?). I mentioned Goldwater’s nuclear saber-rattling. McGovern made two major errors. He didn’t sufficiently vet his VP choice and he ran a boring campaign where he handled his opposition with kid gloves (when it was his fieriness that had brought him his original attention). In other words, he lost his voice or was afraid to use it. Sanders will suffer no such problem. He will not move to the “center” in a general election but rather ramp up his game because he’ll be running directly against a candidate who won’t be able to play the game Hillary has: that she’s a progressive who gets things done. His Republican opponent, with the exception of Donald Trump, will be a stationary target unable to run from the Great Recession caused by Republican/neoliberal policies and practices. Trump’s not completely immune, mind you. He’s just able to change his stripes a bit more. He truly has feet in both camps: libertarian and progressive.
On top of FDR and the Goldwater/McGovern non-issue (which is handled by behavioral politics), we have the Internet. The Internet has changed all things politics. Youth are getting the message unfiltered via alternative media. People such as Paul Krugman, at the seemingly once liberal New York Times, try as they may, can’t dupe the youth or the people in general. Krugman may truly believe what he’s been saying ( https://krugman.blogs.nytimes.com/2016/0 2/06/electability-2/ ). I think he does. But that can’t alter the fact that Bernie Sanders is a known commodity because of the Internet, not because of the NYT or any of the other corporate mainstream-media. That media has only been forced to cover Bernie because of the Internet. Krugman and others are having to fight for their relatively reactionary positions (he opposes socialism; leaving aside that Bernie’s healthcare plan isn’t really socialized medicine) as never before because of the Internet. This process will only continue, unless the anti-net neutrality forces get their way and turn everything into paywall after paywall. All the more reason the people need truly progressive leadership to protect the relatively free flow of political information and debate that occurs via the Internet.
Can Bernie Sanders win the Democratic nomination? Of course. That’s why he’s being hit with the smokescreen of general-election unelectability. Is there really hard data and thorough political modeling and rigorously exhaustive political analysis demonstrating such unelectability? Absolutely not, not even close. Is there every reason to believe that a groundswell for a consistent, unafraid Bernie Sanders could carry him right into the White House? Definitely.
As for the Big Mo, Bernie Sanders is not a Goldwater or a McGovern. He’s come out of “nowhere” way more than they did. The comparisons aren’t even relevant. Sanders Mo is magnitudes of order greater than was theirs. It would take that much more to stop it.
As for the political scientists upon whom the Vox article relies, how many of them thought Bernie Sanders would get as far as he has? Answer: none. Why is that? It’s for the same reason they have taken the positions they have about a general election. They are underestimating how different things have become and are becoming. They are way behind the times. As Bernie rightly said at the outset, “Don’t underestimate me.” When he said that, he also meant, “Don’t underestimate the voters and the rate of change in the political winds, which I (Bernie) can see and help increase.”
Is any of this to say that Bernie Sanders is inevitable? Of course it’s not. It is, however, to say that the unelectable argument was dead on arrival.
⇧ Our Dysfunctional Monetary System – Forbes
Rather than understanding the real cause of the crisis, we’ve seen the symptom—rising public debt—paraded as its cause. …
We are hostage to a dysfunctional monetary system, run by people who don’t understand how it works in the first place. No wonder the global economy is in the doldrums ….
⇧ PBOC Has Only A Few Months Left: Albert Edwards
It looks as if the hedge funds that are betting against China’s currency are closing in on a bumper pay day.
China would be cheap again, which would help it’s manufacturing sector. These things almost always cut both ways.
China should take its losses ASAP, since they appear to be unwilling to do what would get them out of the mess they’ve created: monetary, banking, and political reforms of the democratic type.
⇧ Why doesn’t America’s 4.9% unemployment rate feel great? – Feb. 6, 2016
Why have I been calling the recent wage growth ho-hum?
Heather Long reports:
… wage growth is only 2.5% a year. As Sharon Stark of D.A. Davidson notes, normally when unemployment is this low, wage growth should be humming along at about 4% a year.
The Fed shouldn’t get antsy until unemployment hits 3%. I’ve been saying this for years now. The Phillips Curve has been hugely skewed, but the Fed’s been acting as if it hasn’t.
However, Bernie Sanders saying that the economy is rigged is most assuredly supported by the data. It’s why the Phillips Curve has skewed so much. The rigging has skewed it on purpose, so the plutocrats can reap more of what they didn’t sow and don’t deserve but have rather cheated the sowers of.
⇧ World trade, 1800-2015 | VOX, CEPR’s Policy Portal
… the effect of the Great Recession on long-term growth of trade is sizeable but so far fairly small in comparison with the joint effect of the two world wars and the Great Depression. However, the effects are going to become more and more comparable if the current stagnation of trade continues.
⇧ From Berlin to Basel: what can 1930s Germany teach us about banking regulation? | Bank Underground
… British banks held much safer assets (see Chart 1). In Britain, banks mostly provided short-term credit to corporate clients; long-term financing tended to be done via highly developed capital markets. In Germany, in contrast, banks provided longer-term financing. The need for long-term capital was immense as a result of war, reparations and hyperinflation. But there was no deep capital market to provide this financing. Banks themselves could not raise sufficient own funds to keep up with the expansion in credit they provided to German companies. So they relied on debt financing.
… Hitler’s NSDAP had increased its votes from less than a million to over six million and had emerged as the second largest party in parliament. To make matters worse, a reparations crisis was looming. The German government, still democratically elected without NSDAP participation, declared that Germany was no longer able and willing to pay reparations. US President Hoover proposed a debt moratorium in response. But France resisted, as records from the Bank of England’s Archive illustrate.
⇧ Oil market spiral threatens to prick global debt bubble, warns BIS – Telegraph
The global oil industry is caught in a self-feeding downward spiral as falling prices cause producers to boost output even further in a scramble to service $3 trillion of dollar debt ….
⇧ Economist’s View: ‘Global Growth Now Fraying at the Edges’
The growth rate in global activity remains broadly unchanged at around 2.8 per cent, little different from the rates recorded since mid 2015. However, there has been a further slowdown in economic activity in the advanced economies (AEs), which are growing at only 1.2 per cent, down from 1.6 percent late last year.
This development reduces our confidence that the bout of American weakness in the industrial sector will be easily shrugged off by the global economy. Significant downgrades to consensus forecasts for US growth in 2016 now seem very likely. Although the risk of an outright recession still seems contained, the Fed must surely sit up and pay attention to this.
⇧ Deutsche Bank is shaking to its foundations — is a new banking crisis around the corner? | Secular Investor
… take a step back and explain why the problems at Deutsche Bank could have a huge negative impact on the world economy. Deutsche has a huge exposure to the derivatives market, and it’s impossible, and then we mean LITERALLY impossible for any government to bail out Deutsche Bank should things go terribly wrong. Keep in mind the exposure of Deutsche Bank to its derivatives portfolio is a stunning 55B EUR, which is almost 20 times (yes, twenty times) the GDP of Germany and roughly 5 times the GDP of the entire Eurozone! And to put things in perspective, the TOTAL government debt of the US government is less than 1/3rd of Deutsche Bank’s exposure.
Do you know what would happen if this bank were to collapse? The entire debt after liquidation would be written off; or after nationalization, the entire debt would still be written off.
What else could they do? Even extending and pretending wouldn’t be feasible. Then there would be the global ripples. Make that waves, big waves.
It would, however, be an opportunity for creative destruction. The problem would be that the German people might be too timid to deal with it correctly. The right way to deal with it would be entirely to throw out ordoliberalism. The right way to deal with it would be to look to European federalization with extremely deep democratic reforms at the EU level to bring in as much direct democracy as technologically feasible.
⇧ Fining Bankers, Not Shareholders, for Banks’ Misconduct – The New York Times
It could not be clearer: Years of tighter rules from legislators and bank regulators have done nothing to fix the toxic, me-first cultures that afflict big financial firms.
Regulators are at last awakening to this reality. On Jan. 5, for example, the Financial Industry Regulatory Authority, a top Wall Street cop, announced its regulatory priorities for 2016. Among the main issues in its sights, the regulator said, was the culture at these companies.
But changing behavior — as opposed, say, to imposing higher capital requirements — is a complex task. And regulators must do more than talk about what banks have to do to address their deficiencies.
… in a new book by Claire A. Hill and Richard W. Painter, professors at the University of Minnesota Law School. In “Better Bankers, Better Banks,” they argue for making financial executives personally liable for a portion of any fines and fraud-based judgments a bank enters into, including legal settlements.
“In the old days, because a partnership paid the fine, it would all come out of the partners’ pockets,” Mr. Painter said in an interview. “We’re not going to roll back the clock, but what we can do is come up with a contractual agreement in the compensation package that mimics some of that structure.”
Their plan contains a crucial element, requiring the best-paid bankers in the company to be liable for a fine whether or not they were directly involved in the activities that generated it. Such a no-fault program, the professors argued, would motivate bankers not only to curb their own problematic tendencies but to be on the alert for colleagues’ misbehavior as well.
⇧ Australia’s mining boom turns to dust as commodity prices collapse
“The mining industry is probably in its worst downturn in a century,” Nellist says. “It’s undergoing contraction on a huge scale and it’s not even close to ending.”
Far more Britons on sponsored visas now work in financial services, healthcare, IT and retail, reflecting the fact that the Australian economy is now service driven. Such a shift comes at a cost, however, as service jobs have lower productivity growth than mining jobs. …
The extent of the mining slump, and its duration, remains hotly debated. “The temptation in some quarters [is] to downplay mining’s contribution to Australia’s current and future growth prospects,” says John Kunkel of the Minerals Council of Australia, pointing out that the industry contributed almost half of Australia’s 0.9pc GDP growth in the quarter to September.
⇧ German, French central bankers call for euro zone finance ministry | Reuters
I hear them incorrectly calling for greater technocracy rather than what’s really needed: greater democracy.
⇧ David Cay Johnston: You agree with Bernie Sanders – NY Daily News
Look, I really like this article, as it says exactly the same things I’ve been writing and saying but with two exceptions, which I don’t like at all.
First, he doesn’t know what “democratic socialist” means. Democratic tacked on in front does not, repeat, does not mean non-socialist. It means only that rather than being headed up by a dictatorship of some sort, it is headed up by the voters, the people (the demos). That’s all! It does not mean a mixed economy.
A socialist state is just that: socialist, wherein the state (the people under democracy) owns the means of production. There is no “free enterprise,” per se. There is no private enterprise but only public enterprise. The difference is huge and hugely important.
Secondly and probably more importantly, I don’t like this statement: “It’s unlikely we will ever get to test that proposition; Hillary Clinton remains the heavy favorite in the primary, for a host of reasons.”
She is not a heavy favorite or even a favorite. That will become very clear shortly. [March 1, 2016: I overestimated the awareness by, and savvy of, average voters in the Democratic primaries. Rather than delete the line, I thought it better to leave it and admit I thought the voters were more advanced than they’ve ended up showing themselves to be. Perhaps it will take another serious economic crash and soon. That doesn’t appear in the offing though. What’s it going to take for the people to catch on rather than continue being duped and shortchanged?]
All of that said, David Cay Johnston, who authored the article, is one of my favorites.
⇧ Keynes helped us through the crisis — but he’s still out of favour | Business | The Guardian
Central banks were the first to act. They sought to make money cheaper and more plentiful through deep cuts in interest rates and quantitative easing. Keynes was primarily a monetary economist who believed that governments should only turn to fiscal policy – raising public spending and cutting taxes – when all other options had been exhausted. Fiscal policy was deployed in 2008-09, but only as a supplement to monetary policy.
Up to a point, the strategy worked. There was no second Great Depression and within six to nine months output had steadied across most of the global economy. Attempts were then made to return to business as usual as quickly as possible. That meant reducing the budget deficits that had ballooned during the recession and making only cosmetic changes to the debt-driven economic model that had been found wanting from 2007-09.
So what would Keynes say if he were still alive today and updating the General Theory?
The things suggested that Keynes would say are, in my view, exactly what Keynes would say were he to be consistent with his prior life.
It was a huge mistake not to have had much larger and longer stimulus spending. We would have been out of the Great Recession much sooner. We would have caught up with, and surpassed, where we would have been had the crash never happened.
⇧ Janet Yellen is finding herself increasingly fenced in – CBS News
The problem is that the labor market seems to be tightening — despite a comedown in the pace of U.S. economic growth as well as slowing corporate earnings growth. The labor tightness is resulting from falling productivity, fewer qualified applicants and the still-low percentage of Americans in the labor force. Wage inflation is also on the rise.
Taken together, all of this feels a little “stagflation-y” because it suggests the economy could get the job and wage gains we’ve been waiting for, but in a way that’s bad for the stock market and the overall economy.
⇧ Real Estate/Ahead of the Deal: 150,000 new South Florida condo units announced this cycle | Miami Herald
It is unclear if all of the announced South Florida units will actually get built as developers are increasingly struggling to sell preconstruction condos at a time of a slowing global economy, a strengthening dollar and a growing supply of richly priced units available for purchase.
To this point, the original plans for nearly 20 new condo buildings with more than 2,800 units have been revised, put on hold or canceled.
⇧ Hedge Fund Manager Kyle Bass is Shorting A Real Estate ‘Ponzi Scheme’ – Fortune
Wow! How’s this one going to turn out?
Hedge fund manager Kyle Bass, who runs Dallas-based Hayman Capital, tanked the stock of a little-known real estate financier Friday by revealing that he is shorting the company. Shares of a real estate investment trust (REIT) operated by United Development Funding crashed more than 30% after Bass unleashed his campaign, which accused UDF of orchestrating a $1 billion “Ponzi-like scheme.”
… In its response, UDF said that a hedge fund had built “a significant short position” of more than 4 million shares of its publicly traded REIT, and that it believed the fund was “trying to unlawfully profit by manipulating and depressing the price” of the shares—but it did not name the fund.