News Updates

Breaking Points: 9/22/22 FULL SHOW Russian war escalation, nuclear threats, Trump investigations, interest rate hike, more

Krystal and Saagar cover the Russian war escalation, nuclear threats, Trump investigations, interest rate hike, Biden’s covid comments, gas prices, Adnan Syed, & Home Depot workers!

Chicago Tickets: https://www.axs.com/events/449151/bre…

Vince Quiles: https://twitter.com/MorePerfectUS/sta…

Timestamps: Putin: 0:0023:52 Biden: 23:5337:06 Trump: 37:0752:44 Fed: 52:4557:58 Covid: 57:591:06:07 Saagar: 1:06:081:14:20 Krystal: 1:14:211:23:44 Vince Quiles: 1:23:451:35:46

9/22 NEWSLETTER: Putin vs Biden, Trump Investigations, Fed Rate Hike, Gas Prices, & More!
Welcome to the September 22nd, 2022 edition of the Breaking Points with Krystal and Saagar newsletter. Chicago live show tickets are now available to the general public. If you did not purchase tickets during the presale period, here is a link to get yours: https://www.axs.com/events/449151/breaking-points-live-tickets.
Be on the lookout for Counterpoints with Ryan and Emily tomorrow and send feedback about the Atlanta live show to james@breakingpoints.com.
PUTIN
Russian leader Vladimir Putin has announced a dramatic escalation of the war his nation is fighting against Ukraine. He declared a partial wartime mobilization of Russian military forces and will subject capable men to conscription. They will call up 300,000 reservists to Ukraine according to remarks from Russian Defense Minister Sergei Shoigu. The mobilization effort is the country’s first since World War Two and declared the additional manpower necessary to defeat Ukraine and its western backers. Previously, the Russians had marked their invasion of Ukraine a special military operation, meaning the full extent of its military capabilities had not been mobilized. They have dismissed reports of high Russian casualty numbers and claim only 5,937 men have been killed since the conflict began. In July the Pentagon released an estimate of 15,000 Russian deaths before the Ukrainian counteroffensive began to wreak havoc. In an act of remarkable defiance, Russian citizens took to the streets in protest of Putin’s escalation. They shouted chants against the war and openly defied their government in a nation where such dissent is not tolerated. Many of the protestors were conscripted to fight in the war after being detained by police. By mobilizing its military, Russia is likely going to alter the course of the war and enable them to address the manpower problem plaguing Russia’s army. It is an unprecedented event in recent history, so we will wait to see how it plays out on the battlefield.
Other noteworthy comments in Putin’s announcement came when he discussed nuclear weapons. Roughly translated, Putin accused NATO officials of threatening to use WMDs before asserting his right to use any means at his disposal to protect Russian territory. He said it was not a bluff and added abstract principles to escalate beyond traditional Russian nuclear doctrine. The territory situation could be complicated by the Russian absorption of Donbas region enclaves to be formalized by annexation votes. A dangerous moment, and an indicator of Russian determination to keep the war going indefinitely.
BIDEN
President Biden strongly rebuked Putin’s speech during an address to the United Nations. He condemned Putin’s invasion of Ukraine and his growing threats to deploy nuclear weapons. Further, the US ambassador to Ukraine blasted Putin’s escalation as a sign of weakness and failure while noting the ‘sham’ votes happening in Ukrainian territory. As the administration weighs more support to Ukraine, Americans are less certain about sending aid and military support. They strongly oppose direct military intervention and believe European nations need to pull their weight in backing Ukraine. In the same poll, Americans stated inflation as what the nation’s top priority should be. International sanctions on the Russians have driven up energy and food prices worldwide, contributing to persistently high inflation. In response to Putin, Ukrainian President Zelensky did not rule out the possibility of Russia using nuclear weapons, even though he does not believe they will. He claimed Putin wants to drown Ukraine in blood and has little concern about the deaths of his own troops. Additionally, he vowed to continue liberating Ukrainian territory that Russia has captured and to build on the momentum of Ukraine’s strong counteroffensive in the east.
TRUMP
Donald Trump and his children are in the crosshairs of New York Attorney General Letitia James. She announced a lawsuit accusing the Trump family of overvaluing their assets in a sweeping pattern of fraud in their real estate business. The news broke yesterday morning of a $250 million civil lawsuit filed in Manhattan that also seeks to prohibit the Trumps from running a company in New York. James’ lawsuit alleges that Trump’s valuations were astronomically inflated, such as his Mar-a-Lago property being valued ten times what it was worth. She is referring her findings to federal prosecutors in Manhattan who could use it in a criminal investigation into bank fraud. The Trumps were able to obtain more favorable loans by using the fraud laid out in James’ case. Her team rejected a settlement offer on the lawsuit last month after Trump called it a political attack.
On the Justice Department investigation, Trump’s special master plan has not panned out for him. The selected judge for the role is Raymond Dearie, a well respected national security veteran appointed by Ronald Reagan. In a hearing, he repeatedly challenged Trump’s attorneys on the former president’s claims that highly secretive national security documents had been declassified. Unless they provide evidence, Dearie said, the only basis to judge classification is the labels on the documents. He made note of his intention to prevent Trump’s legal strategy from hampering his task of reviewing the documents independently. Whether the documents are classified or not will not be the ultimate determinant of whether Trump violated the Espionage act or not. Other issues that came up in the hearing were the conduct of the National Archives and security clearances for Trump’s lawyers. An appellate court provided the DOJ with the ability to review over 100 classified documents and take them out of the hands of Trump’s special master. The appeal partially negated Judge Cannon’s initial ruling and is an important victory for the DOJ’s legal team. It could speed up the document review process and the investigation as whole.
FEDERAL RESERVE
The Federal Reserve formally announced its plan to further raise interest rates by 0.75% for the third straight quarter. Officials signaled that another raise is likely to come towards the end of the year to continue the central bank’s efforts to combat inflation. The Fed raised its target interest rate to 3.00-3.25%, the highest level since 2008, and Chairman Jerome Powell acknowledged the pain this process will bring. Nonetheless, he is determined to bring inflation levels down to the central bank’s 2% target. Projections by the Fed predict inflation will not return to 2% until 2025 and show interest rate hikes generating a rise in the unemployment rate as the labor market cools off. Markets reacted negatively to the news across indexes.
A rate hike will add to the housing market downturn happening at the moment. Existing home sales fell in the month of August and prices softened significantly. Prices were still higher than a year ago, and seasonality might be at play, but the drop off was wider than usual. The decline is usually near 2% when this year it was more like 6%. Markets on the lower end of price categories saw the most noticeable decline as markets for more expensive homes hardly budged. Tight supply will limit the extent prices will drop even with mortgage rates continuing to skyrocket. The median housing payment as a percentage of income reached its highest level since 2006 and it could indicate a sustained, nationwide decline in home prices. So far, the home price correction has been primarily concentrated in west coast areas. Out of 896 major regional housing markets, 117 saw home values fall between May and August of this year.
COVID
A comment by President Biden in his 60 Minutes interview last week about the pandemic being over has the White House scrambling. A comment non-controversial among the American people, Democrats have been pushing back against it across the media. Press Secretary Jean-Pierre tried to tell MSNBC his comments were not what he meant to say. She blamed a car show Biden attended in Detroit for the reason he thought the pandemic had ended. The president himself told attendees at a fundraiser that he believes the pandemic is not where it was, but also is not over. He acknowledged criticism from public health officials and Democrats and encouraged attendees to obtain a booster shot. Dr. Anthony Fauci led the chorus of criticism, insisting the United States is not ready to simply liv with the virus. He cited new variants as a reason for caution and the need for more vaccination and booster shots among the general public. Fauci acknowledged the pandemic is heading in the right direction and believes another strong variant will emerge this winter. Most Americans have received a vaccination and are unlikely to be deterred from Fauci’s warnings.
SAAGAR
In his monologue today, Saagar goes into detail about the sustained decline in gas prices across America and why it happened. On Tuesday, gas prices increased for the first time in 99 days and if the trend continues, it could throw a wrench into midterm expectations. Data demonstrates that a precipitous drop in demand by American drivers fueled the decline in gas prices. Outside of the US, demand dropped in Europe because of its energy prices and zero covid lockdowns tanked demand in China. To their credit, the Biden administration released oil from the Strategic Petroleum Reserve into global markets over the past few months. To date, 155 million of a promised 180 million barrels have been released. The 99 day drop was caused by demand drop and bolstered by US policy, however prices still remained much too high. The national price of gas at 3.68 is 43% higher than it was in September 2019 and 60% higher than January 2020. If this is the bottom, it is not a victory, and things could only get worse from here. Russia is showing no signs of backing down and the SPR is at its lowest level since 1984. European energy problems and global supply chain disruptions will continue to reverberate. No structural changes in the US oil supply happened during the decline. Biden’s Russian oil price cap has not worked to this point because other players on the global market have avoided it. They were unsuccessful securing agreements with the Saudis, Venezuelans, or any other supplier to increase production. Now the OPEC countries are cutting supply and signaling to the global market how much they desire high prices. A single shock could send American gas up to five dollars and beyond, with US consumers paying the price. Reality has returned to gas prices after a fleeting window of decline and people could be getting hit really hard.
After the monologue, Krystal and Saagar discuss the demand destruction causing gas prices to drop and the lack of a long term energy policy change. On the political front, Democrats might have peaked too early because Biden’s boost came at a time where gas prices were going down. The Fed is rising interest rates in a way that will harm the economy further and the energy around abortion could be dissipating. Midterms are a coin flip in the senate with the house out of reach and the economy a top issue for Republicans.
KRYSTAL
In her monologue, Krystal takes viewers through the case of Adnan Syed, a 41 year old man convicted of murdering his girlfriend when he was 17. His case became publicized from the hit true crime podcast Serial with journalist Sarah Koenig. She found many holes, inconsistencies, and failures in the process without unraveling the mystery of who murdered Hae Min Lee. After serving 23 years in prison, Adnan is free because prosecutors withheld information from the defense about two other murder suspects. One or both of them had criminal records and instances of violence against women. One had a family connection to the area her car was found and had a motive to kill her. It is important to underscore that none of this information means Adnan is innocent and prosecutors have 30 days to decide whether the case should be tried again. It appears unlikely that they will do so, even though new DNA evidence is still being examined. When listening to the Serial podcast, Adnan does not have the characteristics of a killer and he might have been in prison for a crime he did not commit. A key witness in the case against Adnan was Jay, a friend who was with him for key stretches during the day Hae was murdered. He pointed the finger to Adnan as the killer and claimed Adnan told him about the plan to kill her. Jay says Adnan showed him the dead body and helped with the disposal of the body. Cell phone data used to corroborate portions of Jay’s story is now seen as unreliable. Key parts of the data still back up Jay’s story and he has not come up on the list of alternative suspects.
While Adnan’s innocence remains unclear, he never should have been convicted to begin with. There was more than enough evidence in the trial to create reasonable doubt and he was sent to prison based on a story with many holes. Jay’s decisive testimony played a crucial role despite his admittance of being a liar. When asked about the case, Koenig expressed her dismay about how long the system took to self correct after prosecutorial misconduct. If her show had not turned Adnan into a celebrity, his case would never have received a second look. From 1989 to 2019 there have been at least 2400 exonerations in cases like this, with 44% being due to prosecutorial misconduct. These cases go unnoticed, without a hit podcast to make them into a national story. The family of Hae Min Lee will still be grieving over her death and now we know for certain that the system did a disservice to everyone from the victims to the accused.
After the monologue, Krystal and Saagar examine Adnan’s case and the possibility he is guilty even though the prosecutors withheld information. Jay’s story had holes and changes in key details as well so he is an unreliable witness. His story and the cell phone data are the two pieces of evidence and they do not give enough to put Adnan behind bars. The state’s version of events was wrong and Adnan should not have been sent to jail for it. Hae Min Lee’s family is still searching for answers and grieving her loss in real life.
VINCE QUILES
Krystal and Saagar are joined by Home Depot worker Vince Quiles, a Breaking Points fan inspired by the show to lead a union drive in his workplace. Over 100 workers at a Philly store signed onto the effort in the course of five weeks, prompting management to hold captive audience meetings that ended up backfiring. Workers are pushing for changes to their pay, training, and understaffing problems. When he was promoted to supervisor in the plumbing department of his store, Quiles was not given any training for the new role. Nonetheless, he performed well enough to be offered a management position, which he rejected to stand with fellow workers. The store has made record profits during the pandemic and spends 15 times more on stock buybacks than employee compensation. Workers have struggled to pay their bills and the company’s starting wage is $14.50, lower than Walmart. It’s been hard to retain new employees with low pay, high volume, and minimal training. Christian Smalls at Amazon was an inspiration for the unionization effort because of his herculean effort against the company. Conversations with workers and what they need allowed them to determine that unionization is the best move for them. They want to have a say in how the store is operated because they run a $110 million per year store with virtually no input from workers. Throughout the course of the pandemic, the store made $58 million in profits and only $2 million was invested into the workers. When workers altered management about being overworked and underpaid, they were ignored by management who claimed the company could not afford to treat them better. It changed the way workers have thought about their jobs because during the pandemic, workers were abandoned when the country needed them most. Management has reprimanded the workers in the past and continued to ignore their needs. Home Depot is the fifth largest employer in the United States with nearly 500,000 workers nationwide. A unionization campaign in stores there could lead to a wave across the company and inspire other workers nationwide. They are forming a grassroots union instead of going to a larger, more established union because Quiles and other organizers have trust with workers in the store. Prior attempts to unionize by outsiders generated skepticism and failed in the store. Conversations with labor associated are less persuasive than workers talking to each other and coming from a place of solidarity.
Thank you for reading the Breaking Points with Krystal and Saagar newsletter. Look out for Counterpoints with Ryan and Emily in your inbox tomorrow!

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