Brave New 'Markets': How High Frequency Trading Algorithms Risk Massive Sudden Sell-Off

One thing is clear: These aren't your daddy's markets anymore

Why? Because about 10 years ago the Rise of the Machines (aka high frequency trading algorithms) completely altered the terrain of what we call the 'capital markets.'

Let's look at this as a before and after story.

Before the machines, markets were a place that humans with roughly equal information and reflexes set the prices of financial assets by buying and selling. Fundamentals mattered.

After the machines took over, markets became dominated -- in terms of volume, liquidity and pricing -- by machines that operate in time frames of a millionth of a second. The machines and their algorithms use remorseless routines and trickery -- quote stuffing, spoofing, price manipulations -- to 'get their way.'

Fundamentals no longer matter; only endless central bank-supplied liquidity does. Because such machines and their coders are very expensive and require a lot of funding.

The various financial markets are so distorted that I first resorted to putting that word in quotes – “markets" – to signify that they are not at all the same as in the past. In recent years I've taken to putting double quote marks – “"markets"" – in attempt to drive home their gross distortion. Not only are todays “"markets"" something the human traders of a generation ago would fail to recognize, they're no longer a place where human actions of any sort have much of a remaining role.

Why care about this? Two big reasons:

  1. Such “"markets"" are easily manipulated by central banks and other state actors by virtue of their automated responses to liquidity injections. Are the markets going down when you don't want them to? Just use any one of several highly leveraged means of signaling to the computers that it's time to buy instead of sell. Common leverage points include the Japanese Yen-to-USD price level, selling VIX to lower volatility, and buying massive quantities of index futures 'all at once.'
  2. These manipulations will work until they don't. When they fail, they may well fail spectacularly -- resulting in shattered markets that have to be shuttered until the damage can be assessed. Investors will not be able to access their capital, either to buy or sell, while things get sorted out. When the markets finally do reopen, valuations will be a whole lot lower due to the loss of the huge block of (phantom) volume previously supplied by the now-shut down algos.

The main predicament were facing is that by jamming the “"markets"" ever higher, the central banks have created an enormous gap between current prices and reality.

An easy to see example of this is the housing market in San Francisco, where average income earners cannot afford average houses -- at all. The only way the SF housing market can re-balance to a sustainable level is either for salaries to shoot up massively (while house prices remain flat) or for house prices to fall.

Equities are no different; their prices current suffer from a similar "reality gap". The same is true for bonds.

Obvious Price Manipulations

Just to show that I'm an equal opportunity critic and don't just think gold and silver are manipulated -- and they have been and continue to be, which is now a matter of fact -- I warn that the same dynamics that infest the precious metals "markets" at the COMEX indeed happen elsewhere.

My conclusion is that the HFT computer algos are in complete control of the "market" action, and play with and off of each other to create massive sudden price movements that have nothing to do with anything except book order saturation.

Today's recent example comes to us courtesy of the WTIC oil market on the NYMEX:

Starting around 6:30am, oil futures started drifting slightly lower. A little volume came in around 6:40 a.m. and then -- BAM! -- right at 6:44 a.m. EST, a super spike of volume to the downside occurred. I happened to be watching this in real time and began counting off seconds. Before I got to 3 seconds it was over. (These are one minute bars so those three seconds are obscured in a full sixty second long bar).

So...8 thousand contracts in 3 seconds. Staggering.

For fun, amortize this out over a full trading year. It's a preposterous figure.

The point being, these volume spikes (especially to the downside) have an intensity that is simply overwhelming for the market structure.

Which is entirely the point of the operation. That's the very essence of price manipulation.

Let's try to look at this rationally. Let's define intensity as "volume of more than 2 standard deviations above the recent 1-hour average, divided by the duration of the volume event."

If we do this, an analysis of the oil chart above would go like this:

Say the average volume was 200 contracts/min. The normal 'intensity value' would be 0, because there are no moments above 2 std before the big volume spike (0/0)
Making a guess of a std of 300 for the normal period, at the height of the spike, the value would be ~7,400. Then divide the 3 second episode (expressed in minutes) and you get 148,000.
So from an intensity value of 0, thing spiked up to 148,000 in a matter of seconds.

Is that a useful number or way to look at this? I think so, because it expresses the idea that these volume spikes, combined with their extremely short duration, have an intensity that is far outside of the normal trading bounds. And it's that super out-of-range characteristic that just clobbers the price of whatever is being traded (in this case oil, one of the most widely-traded commodities on the planet).

These blasts destroy the market bid/ask structure in those moments. You have literally zero chance of trading that event as a human, even and especially if using 'insurance' like stops.

This means that the "markets" have a barrier to entry where the cost is the price of a very expensive arrangement of hardware and software capable of operating at the micro-second level. Humans need not apply.

These are not your daddy's markets. They belong to the big players (aka big banks and hedge funds) and their very expensive machines.

Understanding Volume vs. Liquidity

What we're really describing here is a sudden spike in volume that basically destroys the current market book of orders.

What that means is this. Imagine that you are selling eggs at the farmers market along with nine other vendors. There are 500 people wandering the market looking for eggs and other produce. The average sales rate for all 10 egg vendors and all 500 customers is 5 dozen eggs per minute.

The price you can sell your eggs for is set in accordance with the other prices around you. Yours are organic, but small. The vendor next to you has large eggs that are conventional, but larger. And third has small colored eggs from heritage breeds that are free range. Let's say that the range of selling prices is from $4/doz to $5.50 per dozen. This is the market structure for eggs at our farmers market in this thought exercise.

All of a sudden, a giant semi-truck backs up. It's filled with eggs matching every description of those being sold at our small little market. A bullhorn speaker rises from the roof of the truck and announces that 10,000 dozen eggs are now available for the next 1 minute for whatever price anyone is willing to give him for them.

What do you think happens to egg prices over that one-minute window? That's right, the price gets completely crushed. And what do you think happens to demand for eggs among the 500 potential customers at our market? It's completely satisfied. So future demand is eliminated and sales volumes decline accordingly.

In other words, the “"market"" for eggs got ruined, right there and in an instant. You and the other 9 original egg merchants got thoroughly hosed.

The volume of eggs on offer shot up massively all of a sudden, but once all 500 potential egg buyers had been satisfied, the number of buyers dropped away rapidly. Liquidity dried up.

This shows how it's possible to have a market with tons of volume, but no liquidity. There are lots and lots of eggs for sale, but no buyers. All volume, no liquidity.

I know this is a little complex, and possibly arcane, but the points are important to understand. You see, even the most liquid of all possible markets, the US Treasury market, er “"market"", suffered an amazing flash crash back in 2014. It's been pretty well studied, but the culprits were the HTF machines that now dominate that “"market.""

This next chart by Eric Hunsader of NANEX (whom we've interviewed numerous times over the past years) shows the relationship between price, liquidity and volume on that fateful day, when yields plunged and prices spiked (remember in bonds yield and price move oppositely).

Note the first event which was a sudden loss of liquidity, seen at the yellow arrow:

At the same time that the liquidity dried up, you can see volume ticked up pretty strongly and this caused prices to rise. For whatever reason, in HFT land the rules seem to be:

  • High Volume + High Liquidity = small price movements
  • High Volume + Low Liquidity = big price movements
  • High Volume + HFT only Liquidity = flash crash

The point here is this: The computer bots now are the market.

They operate according to a set of pre-programmed parameters. If or when those parameters are exceeded, they simply vanish in less than an eye blink. When that happens, prices go wonky as the remaining few algos go wild. Their resulting erratic trading spikes volumes and prices all over the place.

Why This Matters

Maybe you're thinking, “So what?" Maybe you aren't a trader and think the hows, whens and whys of the computer algos in the Brave New Market isn't really of any concern to you.

But it really is. And here's why.

The flash crash in May 2010 gave us an indication, but the mini flash crashes we see almost daily in various other markets -- ranging from the tiny to the US Treasury market -- tell us that it's entirely possible that someday all the worlds computer algos might suddenly stop operating because an event occurs that is out of their programmed operating state.

We've seen these flash crashes numerous times. The biggies were the 1,000+ point plunge in the Dow on May 6, 2010, the Treasury flash crash of October 15, 2014, the ETF flash crash of August 24th 2015, and the dollar flash crash on the last trading day of 2016.

There have been innumerable smaller flash crashes in specific equities and commodity contracts as well. But the biggies show us that nothing is safe. When you can have flash crashes in the entire equity market index universe, ETFs, the Treasury market, and even the US Dollar, then you know there's no safe place.

Everything is under the control of the computers.

A long-running discussion between Dave Fairtex, myself and others, concerns the idea of whether or not markets as big as the ones just mentioned can be manipulated by government/central banking forces to stop, limit, or even reverse a price decline.

My view has always been “yes", because it should be child's play to fool the algos into going this way instead of that way by simply injecting a relatively small amount of capital at the right place and time.

I would love to know, for example, why central banks have an incentive program at the CME -- where the exact sorts of highly leveraged, electronically traded products that would be best suited for market manipulation -- are traded.

By virtue of its existence, we know that central banks are highly active traders on the CME platforms. Otherwise an incentive program offering steep volume-based trading discounts would not exist.

Not one single central bank (yet) reports anywhere in their financial disclosures of being the proud owners of any of the accounts traded on the CME. So the details of the situation remain a mystery.

But dependably, every single market decline that began over the past several years has been reversed -- usually in the dead of night, and in the futures market -- by mysterious injections of capital that then get the HFT algos to follow the trend. So inquiring minds would like to know.

Back to the story: Dave had an opportunity to meet recently with a super smart HFT developer and operator who confirmed that algos are easy targets for such a manipulation scheme should the central banks wish to engage in such a thing.

So I went off to my afternoon meeting with the HFT trading guru and, well, because of too many ciders I forgot most of the questions. But the one I remembered most clearly did get answered.
I asked him, "Do you think that someone could manipulate the market by figuring out what the bots were coded to trigger on, and then taking action to encourage them to do just that?"
Short answer: yes.
(Source)

So, yes, such a thing is possible. And because it's possible, and there are seemingly no consequences for getting caught, and because the Fed is fighting any sort of audit tooth and nail, and because the CME has a central bank incentive program, and because the “"market"" mysteriously self-corrects at odd moments usualy with a flood of intense futures buying, my inner prosecutor thinks he could win a case in front of a reasonable jury here.

The big issue, however, is what might happen if (or rather when) things get 'out of hand' and the computer bots cannot be cajoled back into the market because the parameters are just too far out of whack. 'A major market accident' is the likely answer.

Dave continues:

Two weeks ago I went to this lecture by a guy (a physics PhD) on unsupervised machine learning techniques called "reinforcement learning". In the past, the lecturer had worked for JP Morgan and others on HFT applications. He's now got this startup, and he was (more or less) recruiting AI/ML people to come work for him.
The sense I got from his lecture is that there was a big initial move using machine learning to harvest pennies, but that the market is very efficient now at that particular thing, and so its tough to make a living these days by using that approach. Another thing he said was that, there are bots out there that try to find your bots, and then trick them into losing money. Enemy bots, as it were.
One interesting question was asked by an audience member: "how do you train your bots for market problems or exceptional conditions?" His answer, informed by years of work in constructing market maker bots, was: "the vast majority of time is spent in 'normal markets' and as such, that's how we train our bots." Basically, when things get dicey, they just turn them off. I've heard that before too, but it was fun hearing it from the horse's mouth.
And, of course, that's why we have flash crashes. Also my sense is, there aren't really enough humans left to make markets in an emergency, since the profits have been all eaten up by the bots - no money to pay the human traders, which would spend 99.5% of their time sitting and looking at the bots doing their work. And the bots have only been trained on "normal situation" operations.
It makes sense. Why train a bot for exceptional situations, when a huge pile of money can be made just on the day to day fluctuations. Not only is finding enough data to train a bot to run during crash situations difficult, testing is problematic, and then of course you have to wait for a crash and see if it actually works. And if there's a bug, losses could be catastrophic. Better to pull the plug when things get iffy.
(Source)

So, why does this matter to you? Because today's "market" structure is so completely broken now that a flash crash can happen in any sector, no matter how large. That's not speculating, that's established fact.

Once a crash really gets under way, for whatever reason, getting the computer bots back online cannot be accomplished until and unless the markets are within certain operating ranges. That's just how they are built and designed. So as long as everything is within a certain set of parameters, the bots will participate. But as soon as they aren't, they'll all just disappear. When they do, they'll take literally 99% of the market quotes away and 70% of the trading volume. In an instant.

So I'll add one more 'rule' to that list above:

  • No quotes + no volume = no market.

Someday parameters will be exceeded and the “"market"" will crash. Unless the central banks can manage to become such dominant buyers in the “"market"" that they become the market. Japan's central bank has already achieved this status in its country's government bonds and ETF markets.

Who knows? Maybe this is the goal of every major central bank. But if so, then we should be having a robust discussion about how this is no different than printing up money and handing it directly to the very wealthiest individuals and most powerful corporations.

That's not monetary policy. That's social engineering.

Conclusion

Patently obvious price manipulations happen daily now in all electronic markets. Oil, gold, silver, indexes, individual equities, options – you name it – all are subject to overt price manipulation tactics being run by the largest and most well-connected Wall Street and private trading firms.

The algos are now the dominant force in the markets in terms of both quote and trade volumes.

Further, the central banks can and do easily use these same lightning-fast programs to halt and reverse market price declines.

This level of micro-management of the “correct" pricing is ruining the core function of the financial markets, which is to set prices by aligning the collective needs and wisdom of millions of individuals and entities.

By ruining this, the central banks have bought some temporary market price stability at the expense of legitimate price discovery. Without that mechanism, mal-investments are now accruing, as they always do when speculation is rewarded over hard work.

Making a sound investment decision requires smarts, effort and risk. Feh! Who want's to go through all that when you can borrow at 1% and retire stock in your company yielding a 2% dividend?

Who wants to figure out how to satisfy all those state and federal regulations involved in opening a new business when you can earn more by playing the speculation game in the financial "markets"?

As my business partner Adam Taggart wrote recently:

When [the market correction eventually] happens, those who decided to look like an idiot early on and refuse to join the party (i.e., positioning their capital defensively), are going to look like geniuses. They will avoid the heartbreak of loss, and they will have capital to deploy when the dust settles, purchasing quality assets at (potentially historic) bargain prices.
It's not an easy choice to make, or to remain steadfast in. It takes foresight, courage, and resolve. But it's a smart choice.
Of course, cash savings is just one of a number of options for positioning your financial wealth defensively right now. For those looking to learn more about other ways to do so, we recommend the following progression:
  1. If you haven't yet read it, read our free report The Mother of All Financial Bubbles to understand the full nature of the situation we're living through today
  2. Read our report How To Hedge Against A Market Correction, to understand the most common strategies for protecting your portfolio from downside risk
  3. For those interested, I've shared how my own personal portfolio is positioned (Note: this is not intended as personal financial advice, but as an example to evaluate)
  4. Schedule a review focused on downside risk management with your financial adviser. If you're having difficulty finding one experienced on this topic, we can suggest one to consider.
It's unknowable exactly how much longer our unsustainable markets can remain at their record levels. But there is one thing we know for certain: we're closer to their day of reckoning than we've been at any point over the past seven years. A recession is due soon by historical standards, and long overdue by fundamental ones.
When it happens, do you want to look like an idiot? Or would you rather choose to look like one now, so that you can look brilliant then?
Choose wisely.

Good luck everyone. This is the most unusual period in all of economic, financial and monetary history. Perhaps this time they've got it right.

But if not: Look out below.

He may not be a super hero like he plays in the movies, but Chris Pratt is proving once again why he's a hero to so many. The silver screen protector of the universe announced on his Instagram page a contest that will benefit the Brain Treatment Foundation, who is a partner of Mercury One that does amazing work with veterans. The Brain Treatment Foundation specializes in helping combat veterans who are suffering from traumatic brain injuries and post-traumatic stress disorder.

The contest asks fans to donate $10 to the foundation for a chance to win a trip to drop in on the Guardians of the Galaxy star on the set of his new film Tomorrow War.

Watch his video below to hear all the details.


Ryan: The Ascent of Kanye West

Photo by Caroline Ryan

Apollo, god of poetry, light, prophecy, dance. Star of Greek mythology, rivaled only by Zeus, his father. God of justice. God of purification, knowledge, healing. God of the Sun. But most of all, god of music. So they called him the Leader of the Muses.

And on a bright Sunday morning midway through November, at the tail end of a decade, Kanye West looked out at the congregation of Joel Osteen's Lakewood Church, a 16,000-seater originally built for the Houston Rockets, and said, "Jesus has won the victory: Now the greatest artist God ever created is now working for him."

Photo by Caroline Ryan

Kanye's newest album, Jesus Is King, had been out for three weeks, and like every Kanye album, it was controversial, as adored as it was unaccepted.

Critics had shown a mostly tepid response, but nobody could tell if their disinterest was genuine, or if it was politically motivated.

After all, for the past year, Kanye had once again managed to penetrate the epicenter of American society. The last two Presidents had literally shamed and cursed Kanye, but, still, who could've guessed he would befriend this one?

Photo by Caroline Ryan

The week after Kanye's Olsteen appearance, at the House impeachment hearings, as the entire country watched and listened, Congressmen and diplomats would mention longtime Kanye collaborator A$AP Rocky no less than five times, in casual reference to the Kardashians and the deal between Trump and Sweden, struck at the urging of Kanye West.

Meanwhile, Jesus is King became the ninth consecutive Kanye album to debut at number one on the Billboard 200 — a feat he shares with Eminem and The Beatles — and the sixth time in the 2010s alone. And, to be fair, his only studio album not to debut at number one was The College Dropout, his first, which went triple platinum and earned the third-most Grammy nominations in one night, winning Best Rap Album and Best Rap Song with "Jesus Walks."

Photo by Caroline Ryan

Jesus is King was also the first record ever to top R&B/Hip-Hop Albums, Rap Albums, Christian Albums, and Gospel Albums simultaneously. All eleven tracks charted on the US Billboard 100, joining the other 96 Kanye songs to have landed on the Top 100.

Photo by Caroline Ryan

This album was different, and not just because of Kenny G. For the first time, Kanye was not a god or a self-destructive fallen angel. He was a father, a husband, a son, and, most important, a man full of belief, with his hands outstretched, surrounded by a choir.

"I remember sitting in the hospital at UCLA after having a breakdown," he told the congregation, "and there's documentations of me drawing a church and writing about starting a church in the middle of Calabasas."

That night, following an afternoon of ice-skating at the Galleria, Kanye returned to Lakewood Church and performed a concert. Imagine hearing a his electro-gospel opera in an arena designed, acoustically, for professional basketball games. Only better, because everything had been padded. With LSD graphics on the swirly blue carpet.

Photo by Caroline Ryan

When we experience art, it changes us.

So there I was, four rows from the stage, crying in front of FoxNews. Because Kanye had brought his Sunday Service choir with him, and they were singing "Ultralight Beam," one of the few perfect songs ever made, a song that played during my wedding ceremony, the song my daughter, God willing, will be born to, a song I have never once listened to without at least tearing up.

“Jesus Is King" A Sunday Service Experience at Lakewood Church with Kanye West youtu.be

"This is a God dream, this is a God dream. This is everything."

Kanye was the only person onstage dressed in his own clothing, a neatened blazer. The choir were draped in grey, like holy silhouettes.

Photo by Caroline Ryan

So who cares about FoxNews and their snotty reporters in their shoulder-padded blazers. The rest of us had drifted into the immediacy of it all. And I wasn't about to play stoic journalist here. I wasn't a reporter first and a human or an American later.

The choir zigzagged on the loft flanking the stage. Each of them had a headset microphone, like Garth Brooks.

God only knew how they sang so perfectly. How did they project their voices like that? More beautiful than anything we had ever heard, more beautiful than water.

After "Ultralight Beam," it was "Every Hour," the mesmeric opening track of Jesus Is King.

Sing every hour, Every minute, Every second, Sing each and every millisecond, We need you

Every Hour youtu.be

The performance felt all the more sacred because this was church, where people gathered to lose themselves, to sing as a chorus, to confront who they really are.

Across the street, one protestor stood hollering.

Meanwhile thousands of people waited at the entrance, giddy to get in. They would join us in no time. Soon, they would fill every seat in this church.

*

That morning, Kanye told Olsteen,

"It's like the devil stole all the good producers, all the good musicians, all the good artists, all the good designers, all the good business people and said, 'you gotta come over and work for me.' And now the trend, the shift, is going to change."

Jesus Is King was the result of a new cultural and artistic movement that more or less started with 2016's Life of Pablo, Kanye's closeted gospel album. Which was a surprising departure from 2013's Yeezus, with its tangled social commentary and fashionable solipsism. And that drum sound, the one every half-decent producer has spent the last six years failing to emulate.

The 2010's saw him grow more cerebral. He even teased a book of philosophy titled Break the Simulation.

Then, in 2018, he released Ye, the second of five albums in a Kanye-produced series, all recorded at his Wyoming studio. In keeping with the criticisms of hip-hop he voiced on "Ye vs. The People"

Photo by Caroline Ryan

Kanye eschewed many of the themes he'd embraced for so long, replacing them with meditations on mental illness, fatherhood, suicide, love, and addiction. The album's working title had been "LOVE EVERYONE."

On "I Thought About Killing You," he raps,

The most beautiful thoughts are always beside the darkest.

The title "Ye" is not just the diminutive of "Kanye."

As he said in an interview

I believe 'ye' is the most commonly used word in the Bible, and, in the Bible, it means 'you,' so it's [saying] "I'm you, I'm us, it's us." It went from being Kanye, which means the only one, to just ye – just being a reflection of our good, our bad, our confused, everything, that I'm just more of a reflection of who we are, just as beings.

Philosopher Hans-Georg Gadamer wrote that

All individuality is a manifestation of universal life, and hence everyone carries a tiny bit of everyone else with him, so that divination is simulated by comparison with oneself.

In the months following the release of Ye, Kanye would live out this idea, and build his own movement, a reflection of who we are, then begin his church in Calabasas.

*

At 10:30 that morning, the three of us — Samantha Sullivan, my wife Caroline, and me —- strolled into the arena and claimed seats in the media section.

That place resembled the inside of an ant colony. We were three ants.

The service began with errorless music, then shifted into a quick, stirring message by Osteen, who always seemed to appear onstage from nowhere, privvy to the kind of big-money stage tricks you find at a Shania Twain concert.

The entire place and all the Jumbo-Trons and all the people, it all had a cinematic presence.

Photo by Caroline Ryan

A preliminary giddiness spread through the room. Then, Kanye emerged, there on the stage, and the place erupted.

A man in a "Jesus is King" shirt danced around his seat.

Photo by Caroline Ryan

Everyone took their seats, but one man standing in the crowd shouted affirmations. "Speak truth my brother," he shouted.

The man shouted several more times, then Kanye politely told the guy to hold off on the support because it wasn't helping, because Kanye needed relative quiet to capture and release his flow.

The ceiling glowed in skittish purple.

Photo by Caroline Ryan

Kanye described the corrupting force of the media. A chill came over the room. Behind him, the unapologetic blue of Jesus Is King.

It was my first encounter with Joel Osteen, and I was surprised and somewhat baffled to find him likeable, based on everything I'd ever heard about the man.

Kanye said as much, that Osteen is nothing like the version of Osteen many people have broadcast.

Photo by Caroline Ryan

Osteen laughed, "When you've got Kanye defending you, you've made it, man."

Rays of light danced through the arena. I'm talking Pink Floyd light show levels.

Photo by Caroline Ryan

With 21 Grammys, Kanye is tied with Jay-Z as the most decorated hip-hop artist of all time.

Osteen asked Kanye what he would say to his younger self, if he could go back in time.

"You know, it's nothing I can say to the younger Kanye through words," he said. "I could speak to the younger Kanye through music."

*

Osteen played the middle section of "God Is," arguably the focal point of the album.

And Kanye danced and rapped along with it. And the surreality of the situation was daunting. Was that really Kanye West up there? with Joel Osteen? dancing to his gospel song?

Six or seven years ago, I saw Kanye a mile away at the Toyota Center — coincidentally, the current home of the Houston Rockets — for his and Jay-Z's Watch the Throne tour. It was a much different experience than this.

Photo by Caroline Ryan

When Kanye finished, the media flooded out. As did a quarter of the people in the congregation. This bothered many of the regulars.

Security and ushers yanked big grey mop buckets from cabinets, and dispersed them down aisles, and money music played.

Photo by Caroline Ryan

Then the time for prayer. Prayer leaders lined the walls and pews. And anyone could walk over to them and pray. Men and women clung to strangers, crying sometimes, hugging. Holding hands, whispering phrases.

*

One of the media coordinators pulled us out of the sermon, led us through passageways and elevators, past classrooms and security guards, through a black sheet, then behind a barricade.

This is where all the media had rushed off to like old folks trying to get the best seat for bingo.

Each news outlet was allowed one question.

After 15 minutes, the energy changed and you could tell they were near.

Then, Kim Kardashian-West was walking our way, holding her daughter's hand, followed by Kanye, who was followed by Osteen.

Photo by Caroline Ryan

"Nice tags," Kanye said, referring to my "GOOD" necklace.

Then:

Brief interview with Kanye West and Joel Osteen at Lakewood Church, Nov. 17 in Houston, TX www.youtube.com

Some of the outlets asked more than one question, but that was on them. They were the ones sinning in church.

*

As Kanye and Olsteen shuffled away, down the line of journalists, I said hello to a small crew from FoxNews as they packed their equipment.

"We're from TheBlaze," I said, smiling. To which they sneered and glanced at one another then got back to their conversation.
Samantha rolled her eyes and the three of us wandered around for an exit.

"Did we just get stiff-armed by Fox News?" Said one of us. "I didn't think they were allowed to look down on anybody."
"I've had that with people from Fox on several occasions," one of us replied.

"I mean, I thought I was doing them a favor a favor by acknowledging them. Nobody else does."

Then it happened again, a few minutes later, this time with someone we had worked with, someone who knew us.
You bet we were salty.

Bad as it felt to be judged like that, it was good to be underestimated. A relief. It meant we could perform without anyone caring or watching.

They had no idea who we were or what we were really doing. Good.

*

In November 2007, Kanye's mother died during a routine surgery. He and his mom, Dr. Donda West, had always been incredibly close. She raised him alone, after Kanye's father left, when Kanye was three.

A few months later, his engagement with Alexis Phifer abruptly ended.

He was 30 at the time.

Oddly, this tragic sequence of events would cause the birth of auto-tune in rap. Broken-hearted, Kanye wanted to sing. So he ran his voice through a vocoder.

Kanye's album 808s & Heartbreak, which like Jesus is King has no curse words, shoved music ahead at least two decades, into a world of synth-driven robotic R&B/Rap love songs belted out in janky auto-tune. That description doesn't sound ridiculous today. But that's only because Kanye eschewed the stale hip-hop of the early 2000s and reinvented the genre, something he has accomplished with every album.

Photo by Caroline Ryan

Then, he went on tour. But he never took off any time following his mother's death. And, by the 2009 MTV Video Music Awards, he'd fallen to what he calls his sunken place.

He and then-girlfriend Amber Rose brought a bottle of Hennessy with them to the award show. They took slugs in the limo. Then on the red carpet.

When Taylor Swift won the award for Best Female Video, Kanye stormed the podium, sunglasses on, and grabbed the microphone, said "Imma let you finish," then let everyone know the award should've gone to Beyoncé, for "Single Ladies (Put a Ring on It)."

He was kicked out immediately. He tweeted, "Everybody wanna booooo me but I'm a fan of real pop culture... I'm not crazy y'all, I'm just real."

Followed by an apology. Then a few days later, during an appearance on debut episode of "The Jay Leno Show"

Leno asked Kanye, "What do you think [your mom] would have said about this?"

That hit Kanyelike a punch to the jaw. He teared up, froze.

He publicly apologized to Swift. Several times.

But it did little to quell the blowback. Once again, it felt like the entire nation hated Kanye. Compounded by a hot-mic recording of Barack Obama — the country's first black President — calling Kanye a jackass.

So the embattled Kanye retreated to Hawaii to record a masterpiece, 2010's My Beautiful Dark Twisted Fantasy.

*

"We are a Christian country," Kanye said at one point, to uproarious applause.

The vast majority of Americans, 90 percent, believe in a higher power.

Photo by Caroline Ryan

And America has the largest number of Christians in the world, with roughly 167,000,000, comprising 65-to-70 percent of the population. But that's down from 80 percent, as part of a downward trend over the last two decades.

The percent of Americans who attend a religious service of any kind — church, synagogue, or mosque — is even lower, less than half.

Photo by Caroline Ryan

One political scientist blamed the public's growing distrust in institutions. Another blamed conservatives. A writer from New York Magazine took it a step further.

Meanwhile, David French.

As always, the issue is far more nuanced than either side will admit.

Somehow, in the last twenty years, church and religion had become not just uncool, but slightly villainous.

All day, every time I looked around — at people singing, at people dancing, at people crying in joy or in the relief and recognition of their pain — I thought, "How could this ever be a bad thing?"

Photo by Caroline Ryan

I had spent my life going to concerts, had seen Kanye West numerous times, and this was something other than a concert, and unlike anything I'd seen from Kanye. It was also more than just religious or spiritual.

A family of strangers in a city of 6 million, in a world of 7-and-a-half billion, broadcast live, led by a man who fought off the devil in front of us for years. Who struggled with life just like we do, only we could nitpick through the one-way mirrors of our phones and our TVs.

But, now, he had been baptized in public.

Photo by Caroline Ryan

Some people were still negative about Kanye's recent faith, especially Christians. As Kanye raps on "Hands On"

What have you been hearin' from the Christians?
They'll be the first one to judge me
Make it feel like nobody love me

Consensus was, they couldn't believe him. As a Kanye fan since I was 13, I can tell you that he is genuine. It's really his only setting. Plus, his spiritual transformation has been building for quite some time.

*

By the time we returned to Lakewood that evening, the sky had turned dark blue, and frantic with airplanes.

The sidewalks around the arena overflowed with people. Police cars jutted out in crooked lines to block entrances or exits, the strobe of red-white-blue whirling onto pedestrians' faces.

Across the street, facing the giant arena, a man with a bullhorn ranted about the evils of sinful music.

Earlier that day, sheepish protestors had occupied the spot, holding red poster-sized letters that spelled out "I M P E A C H." There were only four of them, though, so they had to double up and share, and sometimes the "H" slanted down or the "I" slipped loose.

"Impeach Kanye?" one of us said, laughing.

"Kanye 2020," shouted someone.

The air was electric. People bounced when they stepped, or walked faster than normal, or turned oddly as they spoke like a third-year professor.

They sang along as they passed traffic-jam cars, most of which were blasting Kanye.

A chorus of police whistles and the usual rumble of semi-trucks passing on US-59. Just down the street, porn shops and strip clubs and a Ferrari dealership. Immediately Southwest, the Mahatma Ghandi District. West, the Galleria, home of the opulent Galleria mall, where Kanye and Kim and family gone ice-skating earlier.

Inside the arena, a different world, low-lit and glowing. A dreamscape of lambent crimsons and violets, a deeper, warmer, slower take on the lights atop the police cars outside. Globular squares of blue were arrayed along the ceiling.

Photo by Caroline Ryan

When the musicians emerged to their instruments, the arena was still half-empty. The show had already been delayed 40 minutes. The demand to get in was so ferocious that the security gate was jammed up like a glass Ketchup jar.

Then, like spirits, men and women drifted onstage in all-grey uniforms and matching hats that looked like they should say "VIETNAM VETERAN" but actually said "Sunday Service."

Every single member wore brand-new grey YEEZY Boosts.

From the start, the performance was cinematic, a sort of new-world opera sung by a chorus of young American muses with nose rings or gold chains or dreadlocks or pink hair.

Photo by Caroline Ryan

From the huddle, a young man rose, and began reciting a poem. It was the invocation of the muse.

Gadamer wrote that poetry "becomes a test of what is true, in that the poem awakens a secret life in words that had seemed to be used up and worn out, and tells us of ourselves"

*

After a whirling rendition of Carl Orff's "O Fortuna," the choir began "Ultralight Beam."

They let the song spread. It grew enormous.

The air swirled as the song widened.

Kanye waited out of view, then appeared without ceremony.

A collective gasp when people recognized the melody of Stevie Wonder's "Overjoyed." Which sounds like a dream already, with all that wilderness.

So it was even stranger when the song morphed into SWV's "Weak," a skating rink anthem written by Charlie Wilson of the GAP Band. A classic.

The choir were their own countervailing force. Yet they also connected us to the drama of the performance.
Looking back, I wish I could live in those moments forever.

*

Then came their cover of "Father Stretch My Hands" by Pastor T.L. Barrett And the Youth for Christ Choir.

Father Stretch My Hands www.youtube.com

Kanye has paid homage to Barrett's track on two different songs, from two different albums.

It was his prayer.

Pastor T.L. Barrett, a man who's lived an exciting and at times difficult life, only to become a Pentecostal preacher on Chicago's south side, and form a choir of 40 teenagers from his weekly choir practice.

If you dive into Barrett, you'll better understand what Kanye is doing.

*

Ten seats from Kim Kardashian-West, Rep. Dan Crenshaw (TX) stared ahead in a neat grey suit, occasionally poking at his phone and blasting people on Twitter.

Which means there were at least two people in the building who have appeared on Saturday Night Live.

There were other politicians, including Texas lieutenant governor Dan Patrick. And even more at the earlier service. You could tell they were politicians the same you can tell a vegan burger from a real Whopper. Several times, Kanye held up his phone up and read the words from his newer songs.

Like "Selah," which built into "Hallelujah"s at the end, intoxicating and perfect, like being sucked into an undertow. Which led into "Follow God," a continuation of "Father I Stretch My Hands."

Kanye uses the image of stretched hands to express his own submission and the process that leads to his healing. As a reference to John 21:18

Very truly I tell you, when you were younger you dressed yourself and went where you wanted; but when you are old you will stretch out your hands, and someone else will dress you and lead you where you do not want to go.

But the song is also about Kanye's literal father, and an argument they had. Then, under it all, he adds a sample of "Can You Lose By Following God" by Whole Truth. He ended the song with his Kanye shriek, somewhat confusing and abrasive with a choir present.

Then — something I did not expect. The thumping bass of Cajmere's "Brighter Days (Underground Goodie Mix)."

And now this was cosmic gospel.

It felt like a rave. Have you been to a rave? It's people dancing, taking MDMA. That is what it felt like.

Flourishes like that were part of Kanye's genius. No other gospel performance would dare. You won't find that kind of diversity at any other hip-hop show, either. The acoustic instruments, the choir. Maybe during a set by electronic musicians like Moodyman or DJ Koze. But, no choir. Yet here Kanye was, at Joel Osteen's church, blasting classic techno.

Oddly enough, though, the most popular song of the night was "Closed on Sunday," Kanye's ode to Chic-Fil-A.

Everyone in the arena knew the words. So then there were two choirs, in a dialogue. I didn't think it was possible, but the collective harmony got even more intense and engulfing than it had all night. So much so that the house speakers started to peak in one corner of the arena.

Photo by Caroline Ryan

The Ancient Greeks were the first to use a chorus. In the 5th Century B.C., 50 actors would gather in the orchestra pit and sing in unison, commenting on the action of the play, describing scenes to the audience. They were a collective force. They represented one character, who was able to connect the audience to the characters and events onstage.

Kim Kardashian was front and center filming with her phone, as two of the West kids jumped around on the trippy blue carpet.

The performance was nearing its end, and suddenly Kanye was dressed like everybody else in the choir. Grey Yeezy kit and the Sunday Service hat. His transformation. From Kanye West to Pastor Ye, stretching hands.

Then, he was gone.
One by one, the choir began fluttering off the stage, to the Clark Sisters' "You Brought the Sunshine."

Half were gone, when I noticed the singer with braided hair crying. With every exhale, she collapsed her hands into the floor. Let them fall like tired flowers. Arrayed in fitful blue. She gasped. She heaved her shoulders like a wingspan. For a moment it was like she would actually take flight.

A security guard peered over the railing from above the stage. He looked like God.Symbolically, he was.

New installments of this series on the 2020 elections come out every Monday and Thursday. Check out my Twitter. Email me at kryan@mercurystudios.com

Don't believe in time travel? Think it's just a wild conspiracy theory reserved for late night alien radio programs? Well, we have unearthed bombshell evidence that will blow you away and have you questioning everything!

A 120-year-old photo PROVES climate change activist teen Greta Thunberg is actually a time traveler warning all generations of the dangers of global warming.

Glenn did some exhaustive research and found several other photos and subjects in historical paintings. Check them out here and see if you are now a believer:

Warning Elvis fans

Ryan: Suction energy, pt. 1

Photo by Sean Ryan

After his speech at the Boone County fairgrounds, Joe Biden nodded and people engulfed him like he was their oxygen. Journalists shouted questions, photographers shoved people aside. Biden's bodyguards even drew closer. I found a good oak tree and hid out in the shade, 100 yards from the chaotic huddle.

Photo by Sean Ryan

They shoved closer and closer and closer, with a vacant urgency to their eyes. They had to get as close as possible. It was like some force of nature had taken control of everyone, and now their only goal was to merge their lifeforce with Biden's.

The frenzy of writhing arms and contorted bodies reminded me of Shark Week, when the hulking Great White breaks through the protective cage and how's the diver gonna make it out alive this time?

*

A need for convergence, often leading to upheaval.

Most of the Democratic candidates caused this effect. As did their opponent, to a far greater degree. Because he was the president, and he was Donald Trump, so, for the time being, he embodied this magnetism more fully than anyone else in the entire world.

Photo by Sean Ryan

Every time Trump entered a room or a building or a space of any kind, every person within a reasonable distance felt it. And they couldn't help but bob their head around, and arch up on their tiptoes, scouring till they saw him, and then all they could do was lean forward and wonder if it was actually him.

Some of the Democratic candidates had a stronger magnetism than others. Which meant the gravitational pull had laws that guided it. The term I started using for it was "suction energy."

It was something you could physically feel.

At the Iowa State Fair, Bernie Sanders' suction energy was so intense, so visceral that it reminded me of a hurricane.

Photo by Sean Ryan

People wanted to be as close to the man as possible. They wanted a picture. Proof that it happened—that they had actually seen someone that famous.

And they were perfectly right. And their reactions were understandable and lovely even, and altogether innocent. Encouraging. Because they were genuine.

Even journalists were susceptible to suction energy. In fact, they could spazz even harder. Unlike the public, they were there as workers.

*

Suction energy is an art, something you cultivate. But it's also a result of luck and reality. Some people will just never have an ounce of it.

Take, for instance, Jay Insleey, who was apparently a Democratic presidential candidate in the 2020 election. At some point in my travels, I wound up in the same place as him.

Maybe it was a couple times. A couple, two, three. I can't remember.

All I know is that I went to Clear Lake, Iowa for the Democratic Wing Ding, to see Joe Biden and Elizabeth Warren and the 20 other candidates, and this guy Jay Insless ... sorry, I mean Inslee took the stage at some point. It's hard to say when exactly because, as I mentioned, he was impressively forgettable, like a human thumbtack.

Wing Ding featured Jay Insee?Photo by Sean Ryan

He was yammering about something, and, man, he looked and sounded like P.C. Principal, from South Park, and that was pretty funny.

I told my dad, and then we were both laughing. Then my dad did an imitation of P.C. Principal, and we were really hooting.
Then all I could think about was P.C. Principal. So I ducked out into the hall to watch a P.C. Principal clip compilation, and I laughed and laughed and nobody went "Shush!," because there were plenty of others like me.

Photo by Sean Ryan

And, boy, I laughed. I was actually a bit sad when the clip was over. I'd forgotten where I was, and when I caught a glimpse of the guy onstage, my sadness deepened into pity. The feeling you get when you realize that the amateur thinks he can beat the professional. When the replacements think they will know valor. When your dog thinks they're going to the park, but really it's the vet, and they wake up without balls.

Do we have an obligation, a moral imperative, to tell a Square when she's trying to shove into a Triangle hole? How much teeth-lettuce does a person lodge into their incisors before you are inclined to alert them?

Like, after this speech, that guy John Insley, would wander around the walkways of the Surf Ballroom, same as Kamala Harris and Andrew Yang, only he'd lack their glow.

Crowds flocking to Kamala HarrisPhoto by Sean Ryan

At one point, he'd clench his jaw into what must have been a smile, ready for any nearby journalists to sneak a candid photo or rush forward for a quote.

Photo by Sean Ryan

If any of the others noticed, they didn't let on. So here was this chubby kid in a costume knocking on the front door, and I know full well Halloween was weeks ago, but who's gonna feed the harmless lie if I don't?

Photo by Sean Ryan

Nobody, that's who.

So I groaned and shrugged and told my dad, "Let's give the tubby kid some Starburst."

"Wha?" he asked.

Then I asked would he get a picture of that candidate over there.

"Who," he replied. As in, "I can't see an important person over there, which one is running for president?"

In other words, Insleep had absolutely zero suction energy. To a near-magical extent.

Within a few weeks, he would announce the end of his campaign on The Rachel Maddow Show.

Yet there he was, somehow center stage, looking out at the packed Surf Ballroom, where, on February 2, 1959, Buddy Holly played his last show.

Photo by Sean Ryan

Buddy Holly, now there's a man with suction energy. So much suction energy that, when he died, music went with him.

*

When I saw Kamala during the week of the Iowa State Fair, she was at the height of her campaign, having climbed to second place, within nine points of Biden.

Everywhere I went, there was Harris, with her personalized KAMALA bus, and her chartered press pool, and her entourage of staff and fans and media.

Photo by Sean Ryan

On the first Saturday of the Fair, my dad and I wound up seeing Harris five times. Five times! In part because she could hustle. She wanted that job. But also because she understood power and optics.

Before her speech at Jasper Winery, (when she played savage 4D chess with Andrew Yang, she spoke to several hundred people packed into the atrium of Valley Southwoods Freshman High School in West Des Moines, her fourth rally of that day.

Photo by Sean Ryan

When she finished her speech, a horde surged straight for her, eighty or so.

Photo by Sean Ryan

Just a month earlier, The New Yorker had run a glowing profile on Harris. That was huge. As of the release of this story, Harris was the only 2020 presidential candidate that The New Yorker had featured.

Photo by Sean Ryan

At that point of the election, excitement for Harris was so intense that it seemed obvious she would get the nomination, or close to it. So I wrote five pieces about her.

But by the time I finished all five stories and added them to the publishing schedule, Harris had sunk 11 points to 4 percent, which put her in 8th place. In New Hampshire, the first state to hold primaries, she was polling at 1 percent. By comparison, Biden, Warren, and Sanders were locked at 19.

Now, the only headlines were about her foundering campaign and her dwindling cash and her downsized staff. In each case, the sentiment was the same, "Whatever happened to Kamala Harris?"

Which answer a question I posed in my first story. Would Harris "I got this one in the bag" attitude help her or ruin her? Turns out the ostentatious bus and the unnecessary press accommodations had been a premature move, and now she just seemed cocky.
Because suction energy can, and often does, vanish in an instant.

A Bernie can always become a Jay InslepInslee. Nobody is immune, no matter how powerful they appear. Look at Bill Cosby. Harvey Weistein. Both were godlike in their power. Both had a gravitational pull so intense that they raped women for decades and nobody did a thing. Cosby's suction energy was so intense that he collected honorary degrees like a vacuum collects dog hair. 70 of them. Then, off to prison to eat pudding in the dark.

By the time I saw Harris at the Democratic Debate in Houston, a month after she stormed Iowa, she'd begun transforming into Joe Biden, focused on all the wrong things, laughing at her own jokes, without realizing that nobody else was laughing.

New installments of this series on the 2020 elections come out every Monday and Thursday. Check out my Twitter. Email me at kryan@mercurystudios.com