Krystal and Saagar cover the Uvalde police coverup, Biden’s Ukraine shift, NFT insider trading, Clinton lawyer trial, Depp-Heard trial results, working class recession, Biden’s inaction, electric vehicle markets, & more!
Timestamps: Uvalde: 0:00 – 15:06 Ukraine: 15:07 – 35:39 NFT: 35:40 – 46:49 Sussmann: 46:50 – 55:24 Heard: 55:25 – 1:10:26 Saagar: 1:10:27 – 1:20:09 Krystal: 1:20:10 – 1:30:58 Kristin Eberhard: 1:30:59 – 1:41:58
6/2 NEWSLETTER: Uvalde Coverup, Ukraine Strategy, NFT Fraud, Dem Disarray, Recession Coming, & More!
Welcome to another edition of the Breaking Points with Krystal and Saagar
premium subscriber newsletter for the June 2nd, 2022 full show. No major announcements today, but if you have any issues with your one year subscription, please email firstname.lastname@example.org
. As we have laid out, we have big plans for year two! We hope you enjoyed the month of May and are excited for the Summertime!
The Uvalde mass shooting that killed 19 children and the slew of police miscues that were reported after the fact are now the subject of investigations on a state and federal level. The two police forces at question, the Uvalde PD and the Uvalde Independent School District police force, will not continue to cooperate
with the investigation by the Texas Department of Public Safety’s investigation into the misconduct by local policemen who permitted the shooter to massacre innocent children. The police chief of the Uvalde PD, Pete Arredondo, was the incident commander who instructed the police outside the school not to go in, and the men inside to not breach the school classroom door. Now he has been sworn in
as a city counselor despite not having been seen since the shooting. He has rejected follow up
interviews with investigators and did not appear at the swearing in ceremony. He has not spoken publicly about the shooting since initial press briefings that have proven to be almost entirely false information. One claim that had been made repeatedly was that the back door to the school was open for the shooter to walk into, which is now being disputed
by a teacher who claims she slammed it shut, presumably after hearing gunshots outside. Law enforcement sources say there is footage to corroborate the teacher’s claim, adding to the falsehoods told by the local law enforcement after the shooting. The investigations into the police misconduct will likely be wide ranging in scope to find every last detail, and each breakthrough will be covered with the diligence the 21 victims of the mass shooting in Uvalde deserve.
President Biden came out with an op-ed in The New York Times
laying out the US strategy for Ukraine going forward now that the controversial, bipartisan $40 billion aid package has been signed and Russians are gaining in the Donbas. The words of Biden and his administration being articulated clearly in the NYT need no explanation for its importance for America and the world at large. The President touted the weapons being sent and the defiance of Zelensky’s nation against an aggressor intent on taking control of their country. One weapon Biden was hesitant on sending was rockets with the capability to hit Russia, but in the article he made clear they will now be sent to the Ukrainians. He reminded Americans of the large financial and humanitarian assistance being sent to Ukraine and voiced continued support for major global sanctions on Russia. After backing Finland and Sweden’s entry into NATO, he assured the world that America does not support direct engagement with US troops, usage of nuclear weapons, or regime change in Russia, attempting to clarify remarks he made previously and adding confusion to the situation. Biden showed some interest in diplomacy with Russia and pledged to back Ukraine in negotiations if Putin comes back to the table, contrasting with the words of Boris Johnson and US officials. No indications were made that Biden has an interest in meeting with Putin or having top officials meet with Putin. Then he shined light on the horrors of war that he had seen first hand.
The United States received promises
from Ukraine that the rockets would not be used to attack Russians on Russian soil to calm fears of an attack leading to major escalation. The opposition to escalation was holding back the President from sending the rocket systems previously, and the agreement with Ukraine led to his position changing in the NYT op-ed. The US is getting involved indirectly through cyber means
as well, according to new reports about the military assisting Ukraine through offensive hacking operations. They have conducted operations on the offensive, defensive, and informational side of hacking, with the offensive ones garnering attention because they exist to snuff out foreign hackers who could pose a threat before they make their move. Another new report about US backing of Ukraine comes in the form of armed drone sales
, or unmanned drones armed with hellfire missiles for the Ukrainians to use on the battlefield in the Donbas. They represent a major upgrade for Ukraine because these drones are longer ranged than the unmanned aerial systems currently in their arsenal, and can be used for intelligence purposes with their thirty hour flight capability. These systems are reusable for strikes deep into the battlefield, and could help Ukraine continue to defend the Donbas from the Russian offensive. America has thrown its support for Ukraine in various ways to escalate the conflict, and now it is being conducted through quiet, irregular war methods being facilitated by the executive branch.
With the nosedive of the NASAQ of tech stocks and gloom outlook for private Venture Capital investments, the tech sector has been in the spotlight. In the first ever digital asset insider trading scheme to be identified and acted on by law enforcement, a former employee of an NFT marketplace has now been charged
with wire fraud and money laundering in an insider trading bust. A product manager turned head of product at OpenSea, the largest NFT marketplace, was using confidential information
on what NFTs would be featured on the OpenSea homepage for personal financial gain according to prosecutors at the Department of Justice from the US Attorney’s Office of the Southern District of New York and the New York FBI Field Office. These officials typically handle these types of cases when conducted by Wall Street traders, and now they have identified old school schemes in a new school market. The charges for the NFT market executive carry a maximum sentence of 20 years in prison, and will shake up the digital markets already in free fall due to cratering demand. First brought to light by independent market watchers on Twitter, OpenSea has reportedly implemented new measures designed to prevent employees from insider trading in their NFT market to stave off competitors who could still enter a very new digital terrain.
In other legal news, former lawyer for the Hillary Clinton 2016 Presidential campaign Michael Sussmann was acquitted of lying to the FBI
after he was indicted and put on trial by DOJ prosecutors as part of the Durham probe into the origins of the Russiagate scandal. It marks a major blow for the Durham probe that has been investigating those who facilitated Russiagate since Donald Trump was in office. The details of the indictment are that Sussmann provided faulty information to the FBI about a potential link between Trump and the Russia-linked Alfa Bank that has since been proven to be non-existent. He also worked on Hillary’s behalf with her approval to peddle the tip to the press, based on selective leaks from a data provider sent to Sussmann that he passed along to the authorities. Prosecutors argued Sussmann’s tip was politically motivated and came soon before the 2016 election in an effort to manipulate the FBI for Clinton’s benefit. Jurors believed Durham’s team did not meet legal requirements enough to charge the Clinton lawyer guilty, believing Sussmann’s lie was not relevant enough to impact the FBI’s work. Supporters of the Durham probe have pointed out the potential ideological leanings
of a handful of jurors on the case, and it remains to be seen how the Durham investigation will move forward from here.
The fun segment of the week in today’s E block is the most captivating
legal news of the show, the results of the Johnny Depp-Amber Heard trial currently
dominating pop culture discourse in America. Wednesday saw the jury convene and come to a decision on the results of the trial, based on a defamation lawsuit by Depp and a countersuit by Heard after years of public controversy of the ugly relationship between the Hollywood stars. Jury members found that
Depp should be rewarded over $10 million in damages in his lawsuit, and $2 million in damages for Heard
in her counter. Footage of the case saw Heard’s legal team storm out
of the courtroom with the actress while Depp’s team stayed around to celebrate the ruling, at the one hour and 27 minute mark of the linked Twitter event stream. Analysts view the win as a major victory
for the actor who put out a triumphant statement
reflecting the belief the ruling has vindicated him. Heard lamented
the decision in her lengthy statement expressing her disappointment with the results. For those in politics, the news matters in large part due to the role of the ACLU
and The Washington Post in publishing an op-ed by Heard about her relationship with Depp which played a key role in the verdict and was viewed as defamatory by the jury. Glenn Greenwald has led the chorus of critics expressing how the ACLU’s role in this case represents its very public departure from its mission over the past several years, and as an example of journalistic malpractice by the mainstream media.
In his monologue Saagar examines the growing signs there is a recession coming in the US economy for the working class. Corporations made record profits in 2021 and boasted openly in investor meetings about increasing prices to capitalize on the inflationary environment. A NYT analysis
demonstrated that 2000 companies increased their sales faster than expenses despite the challenges around supply chains and labor costs, leading to record profits because of consumer willingness to tolerate high prices, post pandemic demand, and loose monetary policy. Now the story is beginning to change for the economy and many negative trends are beginning to emerge. Savings are at their lowest since 2008, credit card debt is its highest since 2005, interest rates are being raised, gas is $5/gallon, food inflation is rampant, and all come together to lead to spending reductions by the American people. The main vehicle of the economy is consumer spending and if it even goes down by 1%, disaster will ensue.
The stock market
is tanking and companies believe they have squeezed all they could out of the price increases while supply chains remain a mess. Inflation has wreaked havoc across the economy even for Walmart; the recession-proof business took a 25% hit in the previous quarter for various reasons, scariest of all being decreased food demand. An identical pattern happened with Walmart competitor Target suffering
a 52% drop in Net Income year over year and demand shocks leading to excess inventory of once hot items. Clothing company Gap
is having similar problems with revenue dropping because of sales declining in retail stores and the online retail space. Contagion is moving throughout the economy and the American people will be the ones footing the bill as the companies look to cut costs through firings, halting expansion plans, and going lean in the bad times. It will come at the same time as inflation, leading to unemployment to rise without structural causes of inflation being fixed on supply chains. The only possible way the economy does not go into deep recession is if wealthy Americans
do not reduce their consumption, because they are the only ones spending big with their abundance of cash. While workers struggle and get hit by economic downturns, the reliance on wealthy Americans to keep the economy afloat does not bode well for the future.
After the monologue Krystal and Saagar talk about the economic outlook from Wall Street and the Fed indicating a recession is coming due to higher interest rates in an attempt to curb inflation. There is no good outcome and no good answers especially when the administration and Congress are unwilling to govern in a time they are desperately needed.
In her monologue today, Krystal takes aim at the disarray in the Biden administration and the President himself resigning to being a spectator in chief. When big events happen now, Biden will send out statements wishing something would get done
or issuing words of encouragement. Then the White House promptly checks out
of the debate, like they have with gun control after the Uvalde shooting leaving it entirely up to Congress to act. In the wake of the shooting, no administration officials went on the Sunday shows and Kamala Harris called for an assault weapons ban unlikely to go anywhere in Congress. The President himself made one remark about a handgun ban proposal that won’t gain any traction. Congress is weighing a bill on smaller reforms including bump stock bans, age limits, straw purchases, and other crackdowns. Biden claims he cannot dictate what goes on in Congress and it was reported later on he’s not at all involved in the negotiations. He has blind faith in the rationality of Mitch McConnell and the Republicans to come to the negotiating table in Congress. The exact pattern played out with Manchin in the Build Back Better debate that went back and forth for months before the bill collapsed and Biden failed to live up to his promises. When he did stand up for Amazon workers unequivocally, the administration immediately walked it back
. It is reminiscent of Obama’s administration, where he watched from above and played pundit from the highest office in the world, hoping something gets done for him.
Biden is apparently mystified
by his low polling numbers, now even lower than Donald Trump. He is surprised about the drop with suburban women in the polling numbers, and the WH new believes they have done too much, in contrast to polling numbers
. The largest drop off has taken place among young voters who are the most supportive of bold, dramatic action by the Democratic Party. Biden spent his entire political career chasing the Presidency that he has no interest in using and will continue to decline in the polls. The problem is larger than Biden himself, with him being a vessel of the entire Democratic Party in DC who lack a worldview or ideology they want to use their power to advance. The approach to politics built around doing as little as possible to rock the boat goes back to the Clinton administration, where instead of pushing for anything, triangulation and large donations win the day with a dream of demographic changes inevitably etching in stone a Democratic majority. It creates a situation with the economy on the rocks and control of all three branches not being enough for Democrats to act in a time where the country needs it.
After the monologue, Krystal and Saagar further elaborate on the cop out from governing or politics caused by the demographics is destiny idea still dominant in Democratic circles. Biden has been angered by the media not having more favorable coverage of him, and has shown a lack of interest in governing whatsoever.
Krystal and Saagar are joined by climate policy expert Kristin Eberhard to better understand the electric vehicle market
explosion that has taken place over the past three years. The number of EVs on the road has tripled due to strong demand, leading to bullishness on the future of EV companies and more innovation to improve the vehicle performance. The US needs to continue building out its charger infrastructure to prevent drivers from being stranded without a charge. China is outgunning the US on building EV infrastructure and getting electric buses and trucks on the road, but either way it is a strong sign for US climate innovation accelerated by Elon Musk’s Tesla shaping up the automotive industry.