Friday, March 27, 2020

Not Tilmann Fertitta....

"Do not be deceived, God is not mocked; for whatever a man sows, that he will also reap."
Galatians 6:7

Silver linings:
Last month, on the Friday before the U.S. stock market recorded its worst weekly plunge since 2008, Texas billionaire Tilman Fertitta was beaming.

As he prepared to host an annual Mardi Gras celebration at a beachfront resort outside Houston, business was booming, pushing his personal fortune to more than $5 billion.

A few weeks later -- after the Covid-19 pandemic brought the travel and leisure industry to a virtual standstill -- his casinos and restaurants are shuttered and burning cash, 40,000 of his employees are temporarily out of a job, and a third of his net worth has evaporated.

Few could have predicted the devastating impact that the coronavirus outbreak would have on the global economy. Any business exposed to leisure and entertainment is struggling. Yet Fertitta’s use of financial leverage to build his riches -- including the purchase of a basketball team -- now leaves his corporate empire particularly at risk.


Even the Houston Rockets, which he acquired for $2.2 billion in 2017 by saddling more debt on his other businesses, are sitting idle after the National Basketball Association suspended its season.

“We are doing basically no business,” the billionaire said in the interview. “I think there have been so many people laid off that it could take up to a year later until we are back to normal.”

Debt Damage

Against this backdrop, the nearly $5 billion of junk-rated debt that Fertitta saddled on Golden Nugget -- a holding company for his restaurants and casinos -- has now become an even bigger burden, amplifying the damage caused by every dollar of lost earnings. Junk, or high-yield, ratings are assigned to debt that is at higher risk of default.

Credit-rating company Moody’s Investors Service downgraded Golden Nugget one level to B3 on Tuesday because of the dramatic hit to earnings and rise in key debt ratios expected from the shutdowns imposed to contain the virus. It also warned that further rating cuts could follow if closures last longer than anticipated.

Debt investors are also getting anxious.

Golden Nugget’s bonds are already trading at deeply distressed levels, having plunged more than 50 cents since the beginning of the month. The company’s subordinated notes trade at 45 cents on the dollar, while more senior bonds trade near 49 cents, according to Trace pricing data.

Only two months ago, sentiment in the credit market was so robust that debt investors allowed Fertitta to double the size of a debt-funded dividend he was taking from the company to $200 million. Golden Nugget was also able to lower the interest rate on a $2.4 billion existing loan, which has since tumbled to around 60 cents, according to data compiled by Bloomberg.
To which We can only say:

Not Tilmann Fertitta!!!

Tilmann Fertitta, for those who don't remember, is the guy who:

  • As the afore mentioned owner of the Houston Rockets, spent the Fall of 2019 licking the boots of the Chinese government when the Rockets GM expressed support for Hong Kong protestors on Twitter.
    • Note: Considering Fertitta's disgraceful conduct re: China last fall, it would be even funnier if Fertitta ended up being one of the primary casualties of a virus that originated there.
  • Has acted callous at best towards his employees during the current crisis.
Also, fwiw, as Fertitta has worked his way up the list of 'people we don't like' in recent years, we've heard other gossip about Fertitta.  We're not going to pass along unconfirmed stuff.  Suffice to say, however, they're consistent with all of the public information about Fertitta's arrogance and selfishness.

Bottom Line: Nicer guy, couldn't happen, etc.

Thursday, March 26, 2020

Paxton's so-called "Price Gouging" crusade keeping 750,000 Surgical Masks in Limbo

"He who sows iniquity will reap sorrow,
And the rod of his anger will fail."
Proverbs 22:8

This was completely predictable:
HOUSTON — As Texas Medical Center hospital workers and first responders are dealing with a critical shortage of personal protective equipment, there are 750,000 medical-grade masks sitting in a Houston warehouse in limbo.

The masks were up for auction until Tuesday when a stop was placed on their distribution due to allegations of price gouging by the Texas Attorney General’s Office.

The auctioneer said he is now caught in the middle and wants someone to tell him what he is supposed to do with nearly a million masks.


Worstell received a demand letter from Texas Attorney General Ken Paxton’s Office on March 20, instructing him to discontinue all sales of the masks.

The letter accuses Worstell of price gouging during an emergency.

Worstell said he has been calling the investigator to find out what he is supposed to do with all of the masks now that the auction is closed.

He said nobody will call him back.

“We’re just waiting on the attorney general’s office,” Worstell said. “Can we let these facemasks go to the people who desperately need them, or can we not?”

KHOU called the Texas Attorney General’s Office on Wednesday to find out what the auctioneer should do with the critical PPE now in his possession.

The AG's Office could not confirm or deny any ongoing investigations, a spokeswoman stated in an emailed response, which states the office has received a total of nearly 2,200 COVID-19-related price gouging complaints.

Worstell said he’s cooperated with the Houston Police Department which came to his business to create a report and take photographs.

Without answers, Worstell is sitting and waiting with 750,000 medical masks.
We took Paxton to task on this topic during Hurricane Harvey and stand by everything we said back then.

This time, however, is worse.  This crisis isn't going away for awhile.  And we're obviously going to need new suppliers to enter this space.  Paxton's actions are a GIGANTIC red flag for potential new suppliers.

It's what people in the business world call "political risk."

Bottom Line: Paxton tends to be one of the better elected officials.  But right now he's responsible for a politically created shortage of needed medical supplies.  Knock it off.  Now.


Texas Attorney General: (512) 463-2100
E-mail form.
Twitter: @KenPaxtonTX.

John Zerwas...what could POSSIBLY go wrong?!?

"Therefore by their fruits you will know them."
Matthew 7:20

Apparently, this is a buncha days old, although we only learned about it last night:

We can't think of a worse choice.

The biggest problem with Zerwas is that he's a card-carrying member of the Medical cartel.  He's an insider's insider.  You can learn more about his misdeeds here and here (scroll down to District 28).  To be fair, a lot of those misdeeds aren't directly relevant to the current situation...but it ain't reassuring.

What's really alarming about Zerwas, however, is that he's a gigantic proponent of the so-called Texas "Advance Directives Act" (aka. the Texas Death Panels act).  That's the law that allows hospital bureaucrats to cut off care whenever they claim it's "medically futile."  Obviously, that's a...vague standard at best.

In the (unlikely) event that, God forbid, Texas is looking at a worst case scenario, we can't think of anyone with less credibility that John Zerwas to approach this discussion.

Bottom Line:  Awful selection.

Wednesday, March 25, 2020

#TXLEGE: Bettencourt Talks Sense

"When the righteous are in authority, the people rejoice;
But when a wicked man rules, the people groan."
Proverbs 29:2

It's about time:

Honestly, there's not much more to say.

Crazy part is that has to be said in the first place.

While we're on the subject, kudos to Bettencourt for focusing on the relevant issues, and not falling into counterproductive sidetracks.

Bottom Line:  In a sane and rational world, Bettencourt's sentiments would be considered completely obvious.  Yet here we are.  At least one elected official hasn't gone over the cliff.

Tuesday, March 24, 2020

Cornyn and Patrick AREN'T HELPING

"The tongue of the wise uses knowledge rightly,
But the mouth of fools pours forth foolishness."
Proverbs 15:2

What would a public health crisis be without Texas politicians acting like retards?!?

Exhibit #1:
Hoo boy.

We get it: This virus started in China.  Once the virus was out, the Chinese government made the situation infinitely worse by covering it up.  Since then, they've launched an international disinformation campaign to brand discussion of these facts as racist.  These are all valid points.

Unfortunately, John Cornyn didn't make any of those points.

Instead, John Cornyn made a sensationalistic comment about a third or fourth tier issue that's not relevant at the present time.

Maybe it is the case that some of the...strange...Chinese culinary habits contributed to this outbreak.  Maybe it isn't.  It certainly is yet to be proved.  At best, it's speculative.

Even if that does end up being the case, however, for elected officials to engage such idle chatter is insanely reckless.

And don't get us started on this.

That being said, on the subject of Texas politicians acting like retards, it's hard to beat Exhibit #2:


Once again, there's a very valid discussion to be had over whether or not actions currently being taken by government are good or bad.  It's not exactly a secret where this website stands.  But there's a responsible way to make that point.  Lt. Dan's comment's ain't it.

Instead, Lt. Dan provoked a backlash that will, if anything, make it more difficult to get back to normal.  It certainly doesn't help the credibility of our statewide so-called "leadership."  Reckless, at best.

Sensationalistic dumbassery helps nothing.

Bottom Line:  At best, Cornyn and Patrick unleashed an...extremely poor ratio of backlash to substance.

Monday, March 23, 2020

Abbott Greenlights Local Absolutism (while dodging responsibility)

"Blessed is the man who endures temptation; for when he has been approved, he will receive the crown of life which the Lord has promised to those who love Him."
James 1:12

Oh good grief:
Gov. Greg Abbott took multiple measures Sunday designed to expand hospital staffing and capacity in Texas, but declined to issue a statewide shelter-in-place order — even as calls for such an action increased as the new coronavirus continued to spread across the state.


But he did not order all Texans to shelter in place, noting that there are still many counties in the state without confirmed cases and that he wants to see the full impact of an executive order he issued Thursday.

In the meantime, he welcomed local officials to take more restrictive action than he has statewide. Within two hours, Dallas County was the first local jurisdiction to do so by ordering all residents to stay at home if they were not doing certain essential activities.
The actual statute under which these alleged powers allegedly reside is insane: "The presiding officer of the governing body of an incorporated city or a county or the chief administrative officer of a joint board is designated as the emergency management director for the officer's political subdivision....An emergency management director may exercise the powers granted to the governor under this chapter on an appropriate local scale."  Meanwhile, Steve Adler and Sylvester Turner are going to determine "appropriate local scale."  What could possibly go wrong?!?

On a certain level you do have to stand in awe of how Abbott insulated himself politically.  Abbott gets his photo op.  When these local lockdowns predictably backfire, however, Abbott's going to shuffle off blame to the local officials.  In a cynical way, it's kinda brilliant.

Bottom Line: Woe unto all of us....

Saturday, March 21, 2020

Texas Democrats Exploiting Coronavirus as pretext for "Vote By Mail" Power Grab

"Do not remove the ancient landmark,
Nor enter the fields of the fatherless;"
Proverbs 23:10

PushJunction this morning:
RUNOFF ELECTIONS in Texas have been pushed to July. The move was telegraphed early in the day on Friday by Lt. Gov. Dan Patrick on the Mark Davis radio show.

Before the ink was dry on the Governor's later afternoon proclamation, Democrats sued to expand balloting by mail, a predictable move and tasteless power grab during the Wuhan Coronavirus crisis.

Democrats, without a path to victory, must resort to protecting and expanding vote harvesting and illegal voting when possible. They've sued the state multiple times to try and accomplish this task.

So-called "ballot by mail" is a wretchedly terrible idea.  Learn why here.  But the TL,DR version is that so-called "ballot by mail" is the fastest path to make politiquerias a statewide, rather than a regional, thing.

Bottom Line: No thank you.