Home modems, routers hit by U.S. China tariffs as 'smart' tech goods escape

WASHINGTON (Reuters) – U.S. tariffs that hit some $200 billion worth of Chinese products on Monday spare many high-profile consumer technology items such as “smart” watches and speakers, but the less flashy home modems, routers and internet gateways that make them work weren’t so lucky.

FILE PHOTO: U.S. President Donald Trump delivers his speech next to U.S. and Chinese flags as he and Chinese President Xi Jinping meet business leaders at the Great Hall of the People in Beijing, China, November 9, 2017. REUTERS/Damir Sagolj/File Photo

Consumer tech industry officials and the U.S. Customs and Border Protection agency say they expect billions of dollars worth of these products, including those designed for home use, will be subject to the 10 percent tariffs activated on Monday.

The move will effectively create a two-tiered tariff structure for consumer internet, with many products, such as Fitbit (FIT.N) fitness trackers, Apple Inc’s (AAPL.O) watch and Amazon.com Inc’s (AMZN.O) Echo smart speaker being favored over routers and internet gateways from Arris International (ARRS.O), Netgear (NTGR.O), D-Link (2332.TW) and others.

“We’re operating under the assumption that the tens of millions of devices that deliver high-speed internet into consumers’ homes will be impacted by these tariffs,” said Jim Brennan, Arris’ senior vice president of supply chain, quality and operations.

“It feels anti-consumer because our devices are what enables the core of consumer tech,” Brennan told Reuters.

The modems, routers, switching and networking gear that keep the internet functioning were not included in a newly created U.S. tariff code that was exempted from the latest China tariffs, a spokesperson for the U.S. Customs and Border Protection agency said.

The agency has made no distinction between consumer-use modems and routers and the commercial network equipment used by data centers and broadband internet providers.

Most new internet-connected devices had been lumped into a broad category in the U.S. Harmonized Tariff Schedule, 85176200, “Machines for the reception, conversion and transmission or regeneration of voice, images or other data, including switching and routing apparatus.”

The catch-all category saw $23 billion in U.S. imports from China and $47.6 billion from the world last year. It was the largest component of U.S. President Donald Trump’s latest tariffs targeting Chinese goods.

The U.S. Trade Representative’s office had said it was breaking out items such as smart watches, fitness trackers, Bluetooth audio streaming devices and smart speakers into a new subcategory that would be exempted, but it gave few details.

According to a notice posted by the U.S. International Trade Commission, computer modems would stay in a separate sub-category, while “switching and routing apparatus” would be put into a new sub-category. Neither of these sub-categories were granted exemptions from the tariffs.

“Although we have not had occasion to issue rulings on the scope of a provision for ‘switching and routing apparatus,’ we agree that as a general matter, modems, routers, and networking equipment will be subject to the remedy,” a Customs and Border Protection spokesperson said late on Friday, referring to the 10 percent tariff.

It was not clear how much of the $23 billion in Chinese imports within the catch-all category could escape tariffs, but a Reuters review of industry data suggests the share could be small.

U.S. Census Bureau data has not yet captured the volume of annual imports from China — or any country — of the goods that will be exempt.

But the Consumer Technology Association estimates that the U.S. market for fitness trackers, smart watches, smart speakers and wireless earbuds and headphones was $8.2 billion in 2017, with forecast sales of $11.6 billion for 2019.

Even if China produced a majority of those goods, exemptions would only apply to a fraction of the $23 billion category.

CTA has forecast direct sales of modems and routers to consumers at $2.3 billion for 2019, up from $2 billion in 2017, excluding the products supplied directly by cable and broadband internet providers and equipment used in data centers and other infrastructure outside the home.

But the group argues that consumers will bear the costs of the tariffs, even if their service provider buys the modems.

“Overall, access to the internet will get more expensive, mobile plans will get more expensive, and connected devices that go to your smart phones will get more expensive because everything speaks to each other,” said Izzy Santa, director of strategic communications for CTA.

Additional reporting by Jason Lange in Washington and Stephen Nellis in San Francisco; Editing by Michael Perry

The night a Chinese billionaire was accused of rape in Minnesota

MINNEAPOLIS/NEW YORK (Reuters) – With the Chinese billionaire Richard Liu at her Minneapolis area apartment, a 21-year-old University of Minnesota student sent a WeChat message to a friend in the middle of the night. She wrote that Liu had forced her to have sex with him.

JD.com founder Richard Liu, also known as Qiang Dong Liu, is pictured in this undated handout photo released by Hennepin County Sheriff’s Office, obtained by Reuters September 23, 2018. Hennepin County Sheriff’s Office/Handout via REUTERS

“I was not willing,” she wrote in Chinese on the messaging application around 2 a.m. on August 31. “Tomorrow I will think of a way to escape,” she wrote, as she begged the friend not to call police.

“He will suppress it,” she wrote, referring to Liu. “You underestimate his power.”

This WeChat exchange and another one reviewed by Reuters have not been previously reported. One of the woman’s lawyers, Wil Florin, verified that the text messages came from her.

Liu, the founder of Chinese ecommerce giant JD.com Inc, was arrested later that day on suspicion of rape, according to a police report. He was released without being charged and has denied any wrongdoing through a lawyer. He has since returned to China and has pledged to cooperate with Minneapolis police.

Jill Brisbois, a lawyer for Liu, said he maintains his innocence and has cooperated fully with the investigation.

“These allegations are inconsistent with evidence that we hope will be disclosed to the public once the case is closed,” Brisbois wrote in an email response to detailed questions from Reuters.

Loretta Chao, a spokeswoman for JD.com, said that when more information becomes available, “it will become apparent that the information in this note doesn’t tell the full story.” She was responding to detailed questions from Reuters laying out the allegations in the woman’s WeChat messages and other findings.

Florin Roebig and Hang & Associates, the law firms representing the woman, said in an email that their client had “fully cooperated” with police and was also prepared to assist prosecutors. Florin, asked if his client planned to file a civil suit against Liu, said, “Our legal intentions with regard to Mr. Liu and others will be revealed at the appropriate time.”

Representatives for both Liu and the student declined requests from Reuters to interview their clients.

The police department has turned over the findings of its initial investigation into the matter to local prosecutors for a decision on whether to bring charges against Liu. There is no deadline for making that decision, according to the Hennepin County Attorney’s Office.

The Minneapolis police and the county attorney declined to comment on detailed questions from Reuters.

Reuters has not been able to determine the identity of the woman, which has not been made public. But her WeChat messages to two friends, and interviews with half a dozen people with knowledge of the events that unfolded over a two-day period provide new information about the interactions between Liu and the woman, a student from China attending the University.

JD.com founder Richard Liu, also known as Qiang Dong Liu, is pictured in this undated handout photo released by Hennepin County Sheriff’s Office, obtained by Reuters September 23, 2018. Hennepin County Sheriff’s Office/Handout via REUTERS

The case has drawn intense scrutiny globally and in China, where the tycoon, also known as Liu Qiangdong, is celebrated for his rags-to-riches story. Liu, 45, is married to Zhang Zetian, described by Chinese media as 24-years old, who has become a celebrity in China and works to promote JD.com.

As the second-largest ecommerce website in the country after Alibaba Group Holding Ltd, the company has attracted investors such as Walmart Inc, Alphabet Inc’s Google and China’s Tencent Holdings.

Liu holds nearly 80 percent of the voting rights in JD.com. Shares in the company have fallen about 15 percent since Liu’s arrest and are down about 36 percent for the year.

“IT WAS A TRAP”

Liu was in Minneapolis briefly to attend a business doctoral program run jointly by the University of Minnesota’s Carlson School of Management and China’s elite Tsinghua University, according to the University of Minnesota. The doctoral program is “directed at high-level executives” from China.

Liu threw a dinner party on August 30 for about two dozen people, including around 20 men, at Origami Uptown, a Japanese restaurant in Minneapolis where wine, sake and beer flowed freely, according to restaurant staff and closed circuit video footage reviewed by Reuters.

Liu, who Forbes estimates is worth about $6.7 billion, ordered sashimi by pointing his finger at the first item on the menu and sweeping it all the way down to indicate he wanted everything, one restaurant employee said. The group brought in at least one case of wine from an outside liquor store to drink along with the dinner, according to the restaurant staff.

Security video footage from the restaurant shows the group toasted each other throughout the night.

Later the woman told a second friend in one of the messages that she felt pressured to drink that evening.

“It was a trap,” she wrote, later adding “I was really drunk.”

The party ended around 9:30 p.m. The tab: $2,200, the receipt shows. One inebriated guest was helped out of the restaurant by three of his associates, according to the restaurant security video footage.

Liu and the woman then headed to a house in Minneapolis, according to one person familiar with the matter. Another source said that the house had been rented by one of Liu’s classmates in the academic program to give the class a place to network, smoke, drink whiskey and have Chinese food every night.

But they did not go in. Liu and the student were seen outside the house before Liu pulled her into his hired car, a person with knowledge of the incident said.

In the WeChat message to one of her friends sent hours later, the student said Liu “started to touch me in the car.”

Slideshow (2 Images)

“Then I begged him not to… but he did not listen,” she wrote.

They ended up back at her apartment, according to sources with knowledge of the matter.

Reuters could not determine what happened over the next two hours. According to the police report, the alleged rape occurred at around 1 a.m.

The woman subsequently reached a fellow University of Minnesota student who notified the police, according to two sources and her WeChat messages.

Minneapolis police came to her apartment early that morning while Liu was there, but made no arrests, another source familiar with the situation said. Reuters could not determine exactly what occurred during the police visit, but the source said the woman declined to press charges in Liu’s presence.

In a WeChat message with one of her friends, she asked her friend why the billionaire would be interested in “an ordinary girl” like her.

“If it was just me, I could commit suicide immediately,” she wrote. “But I’m afraid that my parents will suffer.”

By Friday morning, she also wrote to one of her two friends that she had told several people about what had happened, including the police, a few friends and at least one teacher. She wrote that she would keep her bed sheets. “Evidence cannot be thrown away,” she wrote.

On Friday afternoon, the student went to a hospital to have a sexual assault forensic test, the source said.

Police officers arrived at a University of Minnesota office shortly after an emergency call around 9 p.m that night. The student was present at the office, alongside school representatives, and accused Liu of rape, the source said.

Representatives for the University of Minnesota declined to comment on detailed questions from Reuters.

Liu came to the university office around 11 p.m. while police were there, according to the person familiar with the matter. As an officer handcuffed him, Liu showed no emotion. “I need an interpreter,” he said, according to the source.

Liu was released about 17 hours later. Minneapolis police have said previously that they can only hold a person without charges for 36 hours.  

Within days, Liu was back in China, which has no extradition treaty with the United States.

“Liu has returned to work in Beijing and he continues to lead the company. There is no interruption to JD.com’s day-to-day business operations,” Loretta Chao, the JD.com spokeswoman, told Reuters.

Additional reporting by Blake Morrison and Christine Chan in New York, Adam Jourdan and Engen Tham in Shanghai, and Cate Cadell in Beijing; Editing by Paritosh Bansal and Edward Tobin

Retirement: How To Earn High Income Without The High Risk

Generally, a vast majority of folks, especially retirees, associate the Closed-End Funds [CEFs] with high risk, high leverage, and high fees. Many consider them unsafe and unsuitable for long-term holdings. Some others would argue that they have no place in a conservative or a retirement portfolio. Though it is easy to understand why, we tend to have a different opinion. There is no doubt that at times, their market prices can be volatile, more than the broader market-indexes or dividend stocks. It is also difficult to separate the good funds from the bad ones. We believe that in spite of their obvious risks if used with the appropriate diversification and right proportions, they can provide high-income, moderate risk in line with the broader market and at the same time provide market-matching or market-beating returns. It is not about all in or nothing; it is about the right proportions. How much is appropriate? The right amount of exposure to a specific type of investment usually depends on several factors including an individual’s goals, risk tolerance, and personal situation.

We will go over both the benefits and the risks of investing in this kind of portfolio strategy. However, we believe that there are more positives than the downsides and that’s why it deserves a place in your overall strategy. At the same time, they are not for everyone. First, if your investment pool is large and your income needs are less than 3-4% of your investment pool, there may not be a need at all to go for a higher income portfolio. Second, if you cannot tolerate slightly higher volatility (than S&P500), even while you are receiving the high income, you should probably stay away. Lastly, if you do not care about income, but just the total return, obviously these investments are not for you.

We will run several back-testing examples to provide the readers a glimpse of benefits versus risks in comparison to the broader market indexes. In fact, if used in the right proportions in terms of allocation, a CEF portfolio may provide higher income, lower risk, and the longevity of an income-focused portfolio.

In the end, we will provide some updates on our 4-year-old model portfolio, “The 8% Income CEF Portfolio”, which we have maintained here on SA and provided regular updates/reviews. Incidentally, this portfolio is also part of our Marketplace HIDIY service.

Back-Test # 1: (10-CEF Portfolio – Investment over 10 years)

CEFs selection and strategy:

We selected 10 CEFs that were introduced in 1994 or earlier. Selecting CEFs with such a long history is a tough call since a lot of popular CEFs today did not exist prior to 2004 or 2005. Another important criterion for CEFs selection was that we wanted each CEF to belong to a different asset class, and would avoid duplicity as much as possible.

By selecting 1995 as the beginning year, we would be making purchases at increasingly higher prices, especially in 1997-1999. But the subsequent bear market from 2001 to 2003 would even out our cost basis. By selecting the period from 1995 to 2017, we are able to include two full-blown bear markets and two bull-market periods.

We fully understand and appreciate the fact that this process would introduce some element of selection bias. The first factor is that a fund with such a long history would (more than likely) be a successful one. But that may not be entirely true, as there would be others with mediocre performance. However, a selection strategy of picking the best fund among its respective asset class can avoid the pitfalls. Secondly, there may be the beginning year bias. To remove the beginning-year bias, we have included an additional back-testing model (please see the model#3), which should help remove any doubts on that front.

Here is the list of 10-CEFs that we selected going back to 1994-1995:

CEF Name

Symbol

Asset-type

1

John Hancock Financial Opportunities Fund

(BTO)

Equity Securities – U.S. Banks, Regional Banks, Thrifts/Finance holding cos.

2

Tekla Healthcare Investors

(HQH)

Healthcare and Medical Technology

3

Alliance World Dollar Government Fund I

(AWF)

High Yield Government and Corporate Fixed Income Securities

4

Cohen & Steers Total Return Realty Fund

(RFI)

Real-Estate – Equities and Debt Securities

5

PIMCO Commercial Mortgage Securities

(PCM)

Mortgage-backed Securities, Non-Investment Grade Securities

6

New America High Income Fund

(HYB)

Corp High Yield Bonds

7

Morgan Stanley Emerging Markets Fund

(MSF)

Emerging markets Equity Securities

8

Liberty All-Star Equity Fund

(USA)

Equity Securities – US Companies

9

John Hancock Premium Dividend Fund

(PDT)

Preferred Stocks and Dividend Equity Securities

10

Blackrock Muni-Yield Fund

(MYD)

Municipal Bonds – Investment Grade (Tax Exempt)

## Blackrock Muni-Yield Fund (NYSE: MYD) is a Tax-Free Municipal Fund. It may not be suitable inside a 401(k) or IRA account. However, one can choose a taxable municipal fund.

Assumptions:

  • We invested $10,000 every year from 1995 to 2004 (first trading day, every January). Over 10 years, total original investment amounted to $100,000.
  • We would withdraw 6% income from this portfolio (on a yearly basis at the year-end) on the invested capital and take an increase of 2.5% per year for inflation adjustment.
  • Income withdrawals would start right from the first year.
  • The begin- date for the back-test is January 1st, 1995. End-date is December 31st, 2017.

10-CEF Portfolio Return & Income Calculations: – 6% (with inflation) Income Withdrawn:

S&P 500 Return & Income Calculations:– 6% (with inflation) Income Withdrawn:

Performance comparison of the 10-CEF portfolio with S&P 500:

10-CEF Portfolio

(From 1995-2017)

**S&P500

(From 1995-2017)

Total Original Investment

(Contributions made for first 10 years)

$100,000

$100,000

Total Income Withdrawn

$130,011

$130,011

Net Portfolio Value (after income)

$230,801

$116,721

Compounded Annualized Return (in addition to income)

4.76%

0.86%

Net Portfolio Value (No income withdrawn)

$592,483

$432,383

Compounded Annualized Return (when no income is withdrawn)

10.39%

8.47%

*Annualized returns were calculated on the basis of 18 years (not 23 years) since investments were made over 10 years.

**Performance of S&P500 has been taken from the Vanguard 500 Index Fund.

As you could see, for nearly 24 years, the 10-CEF portfolio has performed very well. It provided inflation adjusted 6% income every year and still provided nearly 5% compounded return in terms of capital appreciation. However, if you had put the same amount in S&P 500, after taking inflation-adjusted 6% income every year, S&P 500 did not perform nearly as well and ended up providing very little appreciation (0.86%) in the capital.

Back-Test # 2: (10-CEF Portfolio – Investment over 20 years)

Assumptions:

  • We invested $10,000 every year for 20 years from 1995 to 2014 (first trading day, every January). Over 10 years, total original investment amounted to $200,000.
  • We would withdraw 6% income from this portfolio (on a yearly basis at the year-end) on the invested capital and take an increase of 2.5% per year for inflation adjustment.
  • Income withdrawals would start right from the first year.
  • The begin-date for the back-test is January 1st, 1995. End-date is December 31st, 2017.

Performance of CEF Portfolio – 6% (with inflation) Income Withdrawn:

Performance of S&P500 – 6% (with inflation) Income Withdrawn:

Performance comparison of the 10-CEF portfolio (contributions for 20 years) with S&P 500:

10-CEF Portfolio

(From 1995-2017)

**S&P500

(From 1995-2017)

Total Original Investment

(Contributions made for first 20 years)

$200,000

$200,000

Total Income Withdrawn

$210,084

$210,084

Net Portfolio Value (after income)

$381,290

$252,115

Compounded Annualized Return (in addition to income)

5.09%

1.80%

Net Portfolio Value (when no income withdrawn)

$848,773

$682,218

Compounded Annualized Return (when no income is withdrawn)

11.76%

9.90%

*Annualized returns were calculated on the basis of 13 years (not 23 years) since investments were made over 20 years.

**Performance of S&P500 has been taken from the Vanguard 500 Index Fund.

As you can see, when we do not draw any income, CEF Portfolio performs better than S&P500 leaving a larger balance in the end. However, performance improvement becomes more prominent and significant when we are drawing a constant 6% income (with annual 2.5% increments for inflation).

Back-Test # 3: (10-CEF Portfolio – Multiple Beginning Years)

We wanted to remove the beginning-year bias if there was any, so we decided to include another back-testing model. We would perform the same test (Back-test#1) for our 10-CEF portfolio and S&P 500 with commencement year to move by a year each time (from 1995-2016).

Assumptions:

  • We invested $10,000 every year for 10 years from 1995 to 2014 (first trading day, every January). Over 10 years, total original investment amounted to $100,000.
  • We would withdraw 6% income from this portfolio (on a yearly basis at the year-end) on the invested capital and take an increase of 2.5% per year for inflation adjustment.
  • Income withdrawals would start right from the first year.
  • We conduct a series of tests, each time we change the commencement date. We start with 1995, then with 1996, 1997, 1998 and so on until the year 2016.
  • For each back-test series, the End-date is December 31st, 2017.

Here are the results, in a graphical form. The results favored the 10-CEF portfolio strongly until the year 2008. Only after the year 2009, S&P 500 started outperforming the 10-CEF portfolio slightly.

Note: In the graph, starting years from 2009 to 2016, the investment was less than 100,000 (10K per year). However, they were normalized to a base of 100,000.

Up until the year 2008-2009, the 10-CEF portfolio beat S&P 500 almost every time, irrespective of the year you may have started this portfolio. After 2009, however, both have performed more or less even, but S&P500 has taken a small but clear lead due to the very strong bull market of the last 10 years. The chart also shows that if you were a buy-and-hold income investor, investing in the S&P 500 index during 1995-2001 was not such a good idea.

Backtesting Summary/Remarks:

Even with these three extensive back-testing models, we do agree that some element of selection bias could remain as to the kind of CEFs we picked. One possibility could be that since we were looking for CEFs that had 25+ years of history, a majority of them probably had a better-than-average track record, and the ones with bad track records did not survive for this long, so never made to our list.

In our view, the success of 10-CEF portfolio boils down to the following factors:

  • Wide diversification among varied asset classes; some of them have low correlation with the stocks.
  • Investment over long periods (in a staggered manner), in this case over 10 years. By doing so, even though we bought at the very peak prices during 1996-1999, but we also bought at the bottom during the recession of 2001-2003 at the bottom.
  • Selection of CEFs that have a good track record of maintaining their NAVs (Net Asset Values). We need to be careful to be selective about which CEFs we buy into. Not all are equal in terms of quality.
  • Selected CEFs should have yields in excess of 6-8% and possibly have positive UNII (Undistributed Net Investment Income). This may not apply to some categories of CEFs.

Risks to CEFs Investing:

Obviously, there are some risks to CEF investing, especially when the entire portfolio is based on CEFs. There are several well-known risks.

  • A vast majority of CEFs use high leverage, generally in the range of 20-35%. Some use even higher. This leverage helps them earn higher investment income which then supports a high level of distribution rates. However, leverage works both ways. It does wonders in good times, but during recessionary times it can really hurt their bottom lines.
  • CEFs are generally known for high fees. Normally a part of these fees covers the interest on the leverage being used. However, NAVs are reflected net of fees, and there are no separate fees that the investor has to pay.
  • CEFs provide high distributions, ranging from 6-10%. However, many times, the high distribution may consist of ROC (return of capital). The ROC is not always bad, but it is difficult to separate the good ROC from a bad one.
  • Their market prices normally differ from their NAVs, and this difference is known as discount or premium. To an investor, a discount is obviously better as you would be buying it less than what it is worth. But sometimes, a CEF may be trading at a large discount for a valid reason, for example, its UNII is consistently negative and is not sufficient to support the distribution and a distribution cut may be imminent. When a distribution cut happens, not only the income will reduce, but the market price will fall as well. Another reason could be its track record in terms of NAV has been less than desirable.

In our view, the track record of a fund matter, especially with regards to its NAV. Of course, the comparison should be made within the asset class that the CEF invests in. For example, we know that all energy-related CEFs had performed poorly during 2015-2017 energy prices bust, but still, there will be some who have performed better than others within their class. Also, when we talk about performance, it is better to compare NAV performance rather than the market price.

Our Current “8% Income CEF Portfolio”

We started this model portfolio in October of 2014, and since then, we have published several periodic updates on SA. At the outset, this portfolio had two simple goals; first, to provide 8% income (by way of dividends and distributions); and secondly, provide some capital appreciation over the long term. For income-seeking investors, 8% income will allow a withdrawal rate of up to 6% and leave 2% for growth.

Author’s Note: This model portfolio is part of our “High Income DIY Portfolios” SA Marketplace service. For more details, please see at the top of the article, just below our logo.

In this model portfolio, we allocated $100,000 initially, and another $100,000 was allocated in the next 12 months ($8,333 in 12 installments). Thus the total cost basis for the portfolio stands at $200,000 (excluding the reinvested dividends).

Cash added/contributed:

Initial Investment 10/17/2014:

$100,000

From Nov. 1st, 2014 until Oct 1st, 2015

$100,000

12 installments of $8333. 33

TOTAL Contribution (Cost basis)

$200,000

In this income-centric portfolio, we utilized a diversified group of CEFs. Initially, we selected 12 funds and added a few more in the subsequent years. This approach has provided us a broad diversification, high distributions, and exposure to different types of assets such as Equity, Bonds/Credit Securities, Utility, Infrastructure, Energy MLPs, Preferred Income, Floating-Rate Income, Healthcare, etc. Currently, we have three individual company stocks, one ETF, one ETN, and 11 CEFs.

Here is the current portfolio consisting of 16 securities:

Fund/Stock Name

SYMBOL

Fund’s composition

1

DNP Select Income (NYSE: DNP)

DNP

Utility (80%)

2

Kayne Anderson MLP (NYSE: KYN)

KYN

(MLP – Master Limited Partnership)

3

Guggenheim Strategic Opp Fund (NYSE: GOF)

GOF

Equity CEF fund

4

Columbia Seligman Premium Tech Growth (NYSE: STK)

STK

Equity CEF fund

5

Nuveen Muni High Inc Opp (NYSEMKT: NMZ)

NMZ

Muni Tax-Free ( Tax-free yield)

6

PIMCO Dynamic Credit Income (NYSE: PCI)

PCI

Global Income, including corporate debt, mortgage-related and other asset-backed securities

7

PIMCO DYNAMIC INCOME FD (NYSE: PDI)

PDI

Debt obligations and other income-producing securities

8

ISHARES US PREFERRED STOCK ** ETF **

(NYSEARCA: PFF)

PFF

Preferreds 90% (This is an ETF, not CEF)

9

COHEN & STEERS TOTAL RETURN REALITY Fund (NYSE: RFI)

RFI

REIT (Real Estate) CEF

10

COHEN & STEERS REIT & Preferred Income Fund (NYSE: RNP)

RNP

Preferred is 48%, 50% REIT

11

Cohen & Steers Infrastructure (NYSE: UTF)

UTF

Utility+Infrastructure (50% is International)

12

UBS ETRACS Monthly Pay 2xLeveraged ETN (NYSEARCA: CEFL)

CEFL

Exchange Traded Note (based on the index of CEFs)

13

Tekla Healthcare Investors ( HQH)

HQH

Healthcare/Biotechnology

14

Annaly Capital Management, Inc (NYSE: NLY)

NLY

mREIT

15

Main Street Capital Corp (NYSE: MAIN)

MAIN

BDC (Business Development Co)

16

Ares Capital Corp ( ARCC)

ARCC

BDC

Dividends:

Total dividends earned since portfolio inception: $59,263*

(*this includes $1,382 from securities already sold)

For the year 2018, the projected yield is in the range of $17,000, which will be 8.5% yield on cost.

1

Dividends collected until 09/17/2018

$59,263

3

Cost basis excluding dividends (09/17/2017)

$200,000

4

Portfolio balance (09/17/2018)

$269,843

5

Net profit/Loss (incl. dividends) (09/17/2018)

$69,843

6

Return on total contributed capital, including un-deployed funds

34.9%

Here is the portfolio as of 09/17/2018. The gains/losses shown below are without counting dividends, as they are not re-invested into original securities, but get deposited as cash.

Performance

The table below shows the funds in the portfolio in the order of performance (from best to worst) as of Sept. 17, 2018. The performance has been calculated and sorted after including the dividends.

Comparison with 60:40 Stock-Bond Portfolio:

Here is the performance comparison with a typical Stock-Bond portfolio.

Our Stock-Bond portfolio allocates in the ratio of 60:40 to stocks and bonds. The Stock/Bond portfolio mirrors the invested amounts with 8% CEF Portfolio (at different times). The hypothetical stock/bond portfolio has a 40/20/40 allocation to Vanguard Total Stock Market ETF (NYSEARCA: VTI), iShares MSCI EAFE – International (NYSEARCA: EFA), and (Vanguard Total Bond Market ETF (NASDAQ: BND). So far, the 8% Income Portfolio has beaten the Stock/Bond (60/40) portfolio on both total return and income for the majority of the time.

As of 09/17/2018

Total value

Dividends (since inception)

8% Income portfolio

$269,843

$57,187

60:40 Stock/Bond portfolio

$248506

$15,439

Closing Remarks:

We believe an all CEF portfolio presents a viable alternative to an all-stock or a balanced stock-bond portfolio, however, as part of a broader strategy and allocation model. Obviously, the primary benefit of this portfolio is the constant stream of cash income that it generates, and one does not need to sell shares to withdraw income. It appears that in good times (bull market), this portfolio, after including the dividends, should at least match the broader market performance. However, more importantly, during tougher times, the cash dividends would help protect the downside considerably, as is evident from back-testing models. The constant stream of income will also help the investor to resist the temptation to sell at the worst time.

With the help of several backtesting models and from the past four-year performance from our current model portfolio, in our opinion, we feel this 8% model will likely perform better than a broader market index fund, especially if we need to withdraw high levels of income on a consistent basis. So, we believe this portfolio would have a special appeal to income-seeking investors.

It is important to point out that this portfolio will not protect the investor from a broader market crash or correction. To avoid getting caught in a situation like 2008, we always recommend that one should invest gradually over a period of time, adding equal sums of money every time, which would hopefully smoothen the ride.

Disclaimer: The information presented in this article is for informational purposes only and in no way should be construed as financial advice or recommendation to buy or sell any stock. Please always do further research and do your own due diligence before making any investments. Every effort has been made to present the data/information accurately; however, the author does not claim 100% accuracy. Any stock portfolio or strategy presented here is only for demonstration purposes.

Disclosure: I am/we are long ABT, ABBV, JNJ, PFE, NVS, NVO, CL, CLX, GIS, UL, NSRGY, PG, KHC, ADM, MO, PM, BUD, KO, PEP, D, DEA, DEO, ENB, MCD, WMT, WBA, CVS, LOW, CSCO, MSFT, INTC, T, VZ, VOD, CVX, XOM, VLO, ABB, ITW, MMM, HCP, HTA, O, OHI, VTR, NNN, STAG, WPC, MAIN, NLY, ARCC, DNP, GOF, PCI, PDI, PFF, RFI, RNP, STK, UTF, EVT, FFC, HQH, KYN, NMZ, NBB, JPS, JPC, JRI, TLT.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

#WhyIDidntReport and the Tragic Banality of Rape in America

Professor Christine Blasey Ford was a teenager when she says Supreme Court nominee Brett Kavanaugh tried to rape her. You know the story by now. She didn’t report it at the time, but has come forward now that Kavanaugh is close to being confirmed as a justice to the highest court in the land. On Friday morning, President Trump tweeted that he had “no doubt” that if it had happened, Blasey Ford would have reported it right away.

That’s not how this works. That’s not how any of this works. I know this because this is my story, too, and the story of millions of people. Don’t believe me? Look at Twitter today. Look at the hashtag #WhyIDidntReport. Read the cacophony of stories—each different but the same. Stories of assault by strangers, friends, family members, teachers. The hashtag exposes the sheer banality of rape in America. Sexual assault is not rare. It’s common. According to the National Crime Victimization Survey, there were 320,000 sexual assaults in the US in 2016. And 77 percent of people who experienced rape or sexual assault say they did not tell police.

That number is likely much higher. Though the NCVS data is the best the US has for now, critics have long warned that in addition to suffering from the risk of underreporting that befalls all self-reported surveys, its methodology specifically discourages reporting. In a study from five years ago, the National Academy of Sciences found that the government’s survey was probably vastly undercounting sexual crimes. That report found that a separate survey devoted to sexual assault and rape would have more accurate results.

Tweets are not a replacement for this data. But they can augment it. The stories told today give texture to the statistics that tell us this is common. Three hundred and twenty thousand—even if that number is low—is too big and abstract a number to really fathom. But the tweets shared this morning are real, and individual, and impossible to forget.

In an era of misinformation and bots on social media, when we have daily coverage of the pain that can be inflicted by social media, this hashtag is a reminder of how powerful these mediums can be in bringing people together. (Of course, it was also Twitter that the president used to share the tweet that so startled sexual assault survivors this morning.)

But it’s also worth remembering that a hashtag doesn’t tell the whole story of sexual assault in America. Not everyone is on Twitter, and many people aren’t comfortable sharing their stories—even vaguely—in such a public place. But for some, it’s a crucial outlet to validate our identities at a time when it feels like those in power would like us to be silent. Or invisible.

I say our, because I am included in this. When I read Trump’s tweet this morning, first I stopped breathing. When the most powerful person in the land denies your lived experience, it feels like someone punching you in the diaphragm.

When I breathed again, I paced the room, thinking about when I was a teenager, one year older than Ford at the time of her alleged assault. I was in college, and a boy I trusted date raped me in his room. I told a few friends and then didn’t mention it for years. I didn’t report it. I had a lot of reasons not to, but chief among them was: I didn’t think anyone would care. Why were you in his room, I thought they’d ask. I had previously reported a much less serious sexual assault—groping—in high school, and nothing had happened. Why go through the public embarrassment of that again? I didn’t even tell my family about it for 15 years.

This morning, I picked up my phone and tweeted about that incident. I wanted to speak directly to the president, or anyone reading his tweet and thinking it sounded right. Like the women and men who took to Twitter this morning, I wanted to declare: I exist, here is my story.

Reading through the tweets on the hashtag drives home the innumerable reasons people do not report these events. Chief among them is that they won’t be believed, and then they’ll be punished by whoever has an interest in protecting the status quo. Yet, the collectivism in a hashtag gives us all solidarity. Though it is at once the most public airing of our most personal story, it somehow feels less intimate to tweet about this kind of experience than to sit across the table from a family member or friend and tell them.

Why don’t people report? Here’s what some said.

I’m a man and it would make me seem weak.

It would ruin my career before it had even begun.

Nothing happened the first time I reported.

The person who raped me is the person I would have needed to report to.

They were a friend and I was in denial.

He told me he’d kill me if I told anyone.

Men are tweeting about how, for them, the stigma of coming out and reporting their sexual assault was too much to bear. That’s in line with research that’s been saying the same thing for years. People are sharing about how they didn’t report professors or bosses who had power over their professional lives. Or how they didn’t report family members on whom they literally depended for everything. They’re tweeting about police officers and administrators whom they did tell, but who doubted and blamed them.

This hashtag has power. After I had tweeted and I later saw the trending hashtag, I felt like my story was a raindrop in a lake, at once singular but part of something bigger. I was grateful. I was floored by what so many people have gone through, even while not being surprised. The specifics of their pain: “He held my face so I couldn’t breath.” “He was stronger than me, and my cousin.” “I was 13.”

Every woman and many men I know have a story. Or many stories. In 2016, in the weeks after the Access Hollywood tape came out, I wrote a list of the sexual assault and harassment in my life that I could remember. It wasn’t exhaustive, but it was exhausting. It had never occured to me to write them down before because that kind of experience is so much an accepted part of life for women. “After we are leered at and groped, we get off the train, and go to work, and we don’t mention it, because why would we? This is part of being a woman,” I wrote at the time. I assumed everyone knew.

But everyone doesn’t know. That’s what the #metoo movement, and the backlash to it, has taught us. And that’s why so many people are reliving their own assaults today to share their stories. It hurts to educate people about the ordinariness of sexual assault. It means having to think about something someone might not want to think about. It means remembering the reasons you felt stifled from sharing in the first place. For many of us, it means remembering how violated and embarrassed and guilty, and above all, alone we felt.

I hesitated to tweet this morning. Even though I’d already written about my experience and told my family, and even though I really don’t feel as traumatized by it as I used to, I worried it could in some way seem unprofessional to tell my story. But this thing that happened to me when I was 18; it’s a truth I carry inside me every day.

Even now, telling feels dangerous, despite the fact that the story being told is so universal, which is exactly the point. These are our stories to tell.


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How a Tech Stock Shakeup on Monday Could Have a Big Impact on ETF Investors

For years, buying exchange-traded funds focused on, say, the technology sector has offered a simple buy-and-hold investment strategy for individual investors who wanted exposure to surging tech giants like Facebook and Alphabet.

Come Monday, that simple approach is about to get more complicated. And investors who have money in ETFs based on the S&P 500’s tech, telecom, and consumer sectors will need to take note.

S&P Global Ratings and MSCI oversee a kind of corporate taxonomy, known as the Global Industry Classification Standard (GICS), which groups individual companies into sectors. On Monday, GICS will move three of the four FANG stocks—Alphabet, Facebook, and Netflix—into a new sector. As technical as those moves sound, they will have a big impact on some of the ETFs and passive index funds that mirror those two sectors.

Normally, reshuffling sector stocks wouldn’t be a big deal. But the three FANG stocks being reclassified have market caps totaling $1.8 trillion. Another 14 stocks are being affected by the sector changes, including Twitter, Disney, Comcast, and News Corp..

Most will be lumped together into what S&P had termed the telecom sector, and which will now be named “communications services.” One tech company, eBay, will move to the consumer discretionary sector.

All told, stocks that make up 10% of the S&P 500’s capitalization will be affected by the changes, said Matthew Bartolini of State Street Global Advisors on a recent podcast by Zacks Investment Research. The changes are meant to reflect the way that technology has affected different industries, he said.

“Americans spend more than 12 hours a day on some form of media communications,” Bartolini said. “Dedicating a sector to telecom, which is really carriers and landline operators, no longer reflects the current communications environment. So it really was time for the GICS classification schema to be updated.”

After the changes, the S&P tech sector will go from 26% to 21% of the S&P 500 Index, according to Bloomberg data. The Consumer sector, until recently the home of Netflix and Disney, will go from 13% to 10%. And the revamped communications services sector will make up 10% of the S&P 500 market cap, up from the 2% the old telecom sector represented.

Only some ETF providers are responding to the sector reclassifications. Tech ETFs from State Street (XLK) and Vanguard (VGT) will reflect the changes, but Blackrock’s tech ETF (IYW) won’t. ETF investors may want to check their portfolios, and rebalance if necessary.

Eventbrite’s IPO Is a Hot Ticket as Stock Surges 59% in First Day of Trading

Shares of online-ticketing company Eventbrite rose 59% in their first day of trading as investors clamored for what looks to be a dwindling supply of brand-name tech IPOs in the final months of 2018.

Eventbrite’s stock, which listed on the New York Stock Exchange under the ticker EB, rose as much as 71% to $39.30 a share on Thursday before closing at $36.50. The company initially priced its offering from $19 to $21 a share, but high demand raised the final offering price to $23.

At that price, Eventbrite’s IPO raised $230 million.

Eventbrite created its online service for live-event ticketing 12 years ago. According to a letter from Eventbrite’s founders in the IPO prospectus, the idea behind the site was not only to make it easier for people to organize and distribute tickets for free and paid live events, but also to address a need for face-to-face connections in an era in which people increasingly connect through social networks and other digital platforms.

Last year, Eventbrite created tickets for 3 million events in 170 countries. Its revenue grew 51% to $202 million in 2017 while its net loss declined to $1.98 a share from $2.48 a share. In the first six months of 2018, revenue growth accelerated to 61%, while its net loss increased to 73 cents a share from 44 cents a share a year earlier.

Part of the popularity of Eventbrite’s offering may come from the successful tech IPOs in the last 12 months, including streaming-TV device maker Roku, online-storage provider Dropbox, wireless-speaker manufacturer Sonos, as well as the direct listing of streaming-music giant Spotify. For the remainder of the year, however, there are few well-known tech startups that have signaled plans to go public in coming months.

After Eventbrite, online-survey software company SurveyMonkey is the best-known tech-IPO candidate.

This has been the strongest year for IPOs in several years since 2014 and one of the busiest periods in 24 years. According to Dealogic, 120 companies have staged IPOs in the first half of 2018, raising an aggregate of $35 billion.

Tech company offerings have been among the most successful IPOs.

This Ridiculous Video for United Airlines 'Explains' the New Boarding Process

Some explanations are better left to a simple card or even a text message.

A new video on YouTube, created by United Airlines, tries to explain the new boarding process, which went into effect this week.

Sadly, it makes it seem like an intricate maze.

Before we get into the video and what makes it so confusing, know this: There’s hope. United Airlines did simplify how it all works to board a plane now, trimming the lines down to just two options, green or blue. At first glance, you might wonder if things would be far simpler if there was one lane, but that might also be an indication that you have only flown with really polite people. One lane means way more crowding. People bud in line. Multiple lanes beyond two means more confusion. So I do understand why this two lane approach is much easier.

Then, there’s the video. Here it is:

That’s right. Text pops up in the video in a chaotic fashion, a guy gives you all of the boarding pass advice, a cheesy music tracks plays in the background, and there are blue and green colors flashing at you like crazy. By about halfway in or maybe two-thirds, it starts to feel like someone went overboard with the two primary colors. It’s not a terrible video, but it also doesn’t help explain a simple process. And it probably shouldn’t exist.

The problem with visual communication, of course, is that it can go way too far. The video is two minutes and 21 seconds long when it should have been about 30 seconds. A voiceover saying “there are now only two lanes, and you’ll split into two groups depending on which zone you’re in” would have been just about right. Text me that, then snap–done.

There’s something to be said for “you’ll figure it out” after giving a teaser or a hint of what’s going to happen when you board. A sign is sometimes better than a video.

It would be like trying to explain the airport kiosks. You know, they are super simple. Insert your ID or a credit card, punch a few buttons, grab your boarding pass.

If a video tried to explain things like multiple layovers, what to do if your ID doesn’t work, or just about any other scenario that would make it seem complicated would…make it seem complicated. Very few people get confused by kiosks. It’s actually better to skip a video altogether. I always notice someone hovering around the kiosks anyway. And, if you don’t watch the United Airlines video explaining the new process, you’ll figure it out. It speaks for itself. And there are screens everywhere. And gate agents are readily available.

It’s a bit ironic, actually.

By making an explainer video, it makes passengers more stressed instead of less stressed. The video itself tells you ot to be stressed, which is a sure sign that you might want to be stressed. What would be far less stressful? No video at all.

And, this is where things get interesting, by the way. For anyone trying to communicate about a slightly complex topic, the first question to ask is: Should this even be a video? Or is it better to include a few directional indicators at the point where someone needs to know a new process? Think about something as simple as placing an order for products and services. Sometimes, not explaining something makes it all seem easier.

My best example of this has to do with McDonald’s kiosks.

They are not as common in the U.S., but I started using them on a trip to Austria recently. I can’t imagine how anyone could improve them. They have huge icons, you click things to order. That’s it. Making the process itself easier–which United Airlines has done–is the big win. Trying to explain why something is easier–which is the mistake United Airlines made in the video–is a sure way to create even more confusion.

Eventbrite Raises IPO Pricing Range, Now Hopes to Raise as Much as $230 Million

Eventbrite, an online platform for live-event ticketing, raised the proposed price of its planned IPO to a range of $21 a share to $23 a share from its previous range of $19 a share to $21 a share.

When IPO candidates increase the price of their offerings, it can signal a strong demand among institutional investors. Eventbrite is planning to sell 10 million shares later this week, listing its shares on the New York Stock Exchange under the ticker EB. At the high end of the new range, Eventbrite’s proceeds from the IPO would total $230 million.

The company was founded in 2006 as a way to make it easier for people to organize and distribute tickets for free and paid live events. Last year, Eventbrite created tickets for 3 million events in 170 countries. Its revenue grew 51% to $202 million in 2017 while its net loss declined to $1.98 a share from $2.48 a share.

In the first six months of 2018, revenue growth accelerated to 61%, while its net loss increased to 73 cents a share from 44 cents a share a year earlier.

Despite the higher net loss so far this year, demand for Eventbrite shares was enough to prompt a higher price. Part of that popularity may come from the successful tech IPOs in the last 12 months, including Roku, Dropbox, Sonos, as well as the direct listing of Spotify. Outside of Eventbrite and SurveyMonkey, there aren’t a lot of well-known tech startups heading through the IPO pipeline later this year.

2018 has been the strongest year for IPOs in several years. According to Dealogic, 120 companies have staged IPOs in the first half of 2018, raising an aggregate of of $35 billion. It’s the best first half for U.S. IPOs since 2014 and one of the busiest periods in the 24 years that Dealogic has been tracking IPO data. Tech offerings have been among the most successful IPOs.

SpaceX Will Reveal the First Moon-Bound Passenger Since 1972. Here’s How to Watch

SpaceX says it’s signed the first private passenger to fly around the Moon in one of its rockets, and will reveal the mystery passenger’s name at 6 p.m. Pacific Time, Monday. The event, held in SpaceX’s Southern California headquarters, will be broadcast live via a YouTube stream. You can watch the announcement here on YouTube or on a page that SpaceX has set up on its site.

As part of its preparations to create a spacecraft that can fly people to Mars, SpaceX is building what it’s named a BFR—which stands for the Big Falcon Rocket—that will approach the Moon without landing, via a path similar to the one that Apollo 8’s astronauts took on a December 1968 mission. SpaceX has yet to disclose a launch date for rocket, which remains to be built.

The announcement represents a reprieve from months of bad news for SpaceX founder Elon Musk, whose efforts to take on Twitter trolls and to take private Tesla, another company he founded and now leads. SpaceX says that only 24 humans have visited the Moon or its orbit in history, with the last one traveling on a 1972 Apollo mission.

That mission, the Apollo 17, included a crew made up of Commander Eugene Cernan, Command Module Pilot Ronald Evans, and Lunar Module Pilot Harrison Schmitt. SpaceX’s passenger will be the first person to take a space flight toward the moon who did not train through a formal program like NASA.

President Trump's Tweets Top This Week's Internet News Roundup

In the past seven days New York decided it didn’t want Cynthia Nixon as its governor, Amazon’s owner elected to get into the education business, and a series of gas-line explosions hit north of Boston. But on the plus side, we also had Mark Wahlberg’s schedule to look at and a new Dolly Patron/Sia collaboration to listen to, so I guess it’s not entirely a hellscape out here? Maybe? While we ponder that idea together, let’s look at what else has been dominating the online conversation over the last week.

Is There Such a Thing as a Solemn Fist Pump?

What Happened: President Trump probably could’ve handled the anniversary of 9/11 better than he did.

What Really Happened: The anniversary of the September 11 attacks in 2001 is a solemn occasion, and one in which the United States turns to its president to see empathetic, strong leadership that comforts everyone and embraces the country’s greatest strengths during a troubled time. President Trump’s behavior on 9/11 this year was, well, maybe not that.

He did, to be fair, address the topic people wanted him to.

Funny thing about the image in that last tweet…

There was also this:

Oh, and this:

What could be more presidential?

As the media dazedly recounted Trump’s behavior during the day, others found a memetic outlet for those appalled by what was happening.

There. Doesn’t that feel almost cathartic? There’s nothing that can’t become content, if we try hard enough.

The Takeaway: To be fair, it could have been worse. No, really.

Bad Tweets, Part 2

What Happened: Apparently, when you’re prone to paranoid thinking, it’s very easy to become a truther for all kinds of things.

What Really Happened: Actually, speaking of things that could’ve been worse, let’s take a brief moment to discuss what might be the worst thing President Trump has done on Twitter yet. First off, please remember that an independent study by the Milken Institute School of Public Health at George Washington University found that the death toll in Puerto Rico after Hurricane Maria stands at 2,975 (and rising. Now, with that number in mind, consider that as recently as this past week President Trump was calling the government’s response to Maria “incredibly successful,” and complaining that the work was “an unappreciated good job.” OK, now that you know all of that, think about this:

Yes, that really was Trump outright denying the deaths of thousands of people, and claiming it was a lie motivated by politics. Just let that sink in for a second.

Of course, this was news because how could it not be? The president is outright being a hurricane impact denier, which is genuinely staggering.

Still, at least his Republican counterparts stood up against him. Right? Well, OK, Orrin Hatch and House Majority Leader Kevin McCarthy claimed they hadn’t seen the tweets, Lindsey Graham also questioned the death toll, and Marco Rubio tried to straddle a non-existent line.

Studies in leadership, all. (FYI, a couple of Republicans did eventually push back.)

The Takeaway: If this was, as some believed, an attempt to distract attention away from other subjects, it certainly worked well. Maybe a little too well.

All Those Witches, Lined Up and Offering Confessions

What Happened: The ongoing so-called “witch hunt” against those surrounding President Trump claimed another victim last week, as Paul Manafort pled guilty in court on Friday.

What Really Happened: On Friday, the one thing that political watchers had simultaneously been expecting and convinced was unlikely to happen—let’s call it the Schrödinger’s cat of the current political moment—finally happened: Former Trump campaign chairman Paul Manafort agreed to plead guilty to avoid a second trial.

The news resurrected a piece of Trump-related ephemera in at least one person’s mind.

Of course, people are already wondering how this impacts the big picture.

At the time of this writing, Trump’s Twitter feed is filled with Hurricane Florence-related retweets, but it’s genuinely only a matter of time before he responds to this news and revisits his previous statements about Manafort.

Still, at least the White House has its angle, as utterly unbelievable as it is.

Once again, Paul Manafort was the chair of the Trump campaign, and the man who chose the vice president. It’s more than a little disingenuous to claim that this has nothing to do with the campaign. But tell that to those around the president.

The Takeaway: There’s really only one way to end this, isn’t there?

Ringo Starr Would Be Appalled

What Happened: Just in case you thought that Thomas and Friends was a jolly series about happy trains and overweight controllers, the National Rifle Association has a shocking piece of information for you. Yes, the National Rifle Association.

What Really Happened: Everyone knows that, sometimes, there’s something in combining two flavors together to create a fun and exciting taste combination that will thrill the masses. Chocolate and peanut butter? It’s a game changer! The NRA and Thomas and Friends? Maybe a little less so, as it turns out.

Yes, you read that right. A show on the National Rifle Association’s streaming service dressed characters—you know, trains—from Thomas and Friends in KKK hoods. This is actually a thing that really happened, somehow.

It’s quite breathtaking that this was real—so real, in fact, that it became a story in its own right, because sure, why not? But at least Twitter was totally cool with it. Oh, no. Wait.

But how did Dana Loesch, who hosted the segment, feel about the whole kerfuffle?

The Takeaway: There really is just one way to wrap this one up. George Takei, do you have the pun-o-matic ready?

Emergency Services

What Happened: There’s one organization that even the federal government turns to in times of natural disaster, and with a hurricane headed towards the East Coast, last week seemed like the time to shine a spotlight on it.

What Really Happened: Late last week, Hurricane Florence made landfall on America’s East Coast, leading to a very difficult number of days for everyone whose homes, family, and loved ones in its path. But even before it hit, Florence was very much being considered a big deal.

With mandatory evacuations underway, people watched as the storm grew stronger, then seemingly weakened before getting stronger again. Was it going to slow down and linger in certain areas? It was hard to tell. Even NASA got involved. That mixture of surreal expectation and fear kept building throughout the week as the hurricane continued to approach.

But how serious were storm preparations on the ground? I mean, a state of emergency is one thing, but is there another way to measure these things? Turns out, the answer is yes, and in the most amazing way.

It’ll come as little comfort for those affected directly by Florence, but for everyone else, there’s some strange joy to be had in watching the Waffle House Index go mainstream. The world can still offer unexpected delights, it turns out.

The Takeaway: Stay safe, everyone.


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