Watch Live: Nvidia CEO"s Keynote Speech, The "Week"s Most Important Event"
Watch Live: Nvidia CEO's Keynote Speech, The "Week's Most Important Event" Watch Jensen Huang's keynote speech live: As we wrote in our weekly preview note earlier, while this week is chock-full of central bank announcements, including a historic rate hike by the BOJ which will also be ending its YCC and purchases of ETFs, all eyes are on Nvidia which has two key events this week, the first of which may be even more market-moving than the central bank announcements. We are talking about NVIDIA hosting the world's largest and most important conference centered around AI, its GTC (Graphics Technology Conference), where CEO Jensen Huang will talk about the next innovations in the segment and unveil the next generation of GPUs powering the latest cloud and data center markets. For those unfamiliar, NVIDIA is hosting its latest episode of GTC today at 4pm (right at the market close) and what makes 2024's GTC special is the fact that the company has seen huge successes from the AI segment when it comes to its financial performance. Starting with its Volta V100 GPU family up to the latest Ampere A100 and Hopper H100 chips, the company is the official king of AI. But at the same time, the market is heating up with competition hitting back on both the hardware and software sides. Keeping that in mind, this GTC, NVIDIA is not only going to respond to its competition with new hardware innovations but will also certainly showcase how its AI software strategy has helped define its leadership in this segment and how it will evolve over the coming years. According to wccftech, some of the new products that we can expect to see at the keynote will be the Hopper H200 GPUs featuring the fastest HBM3e memory with upgraded capacities, and also the first showcase of the truly next-gen Blackwell B100/B200 GPUs. There are reports that the first generation of Blackwell GPUs will feature HBM3e memory with huge computing and AI-side upgrades while the B200 GPUs will take things to the next level in the coming year with updated HBM4 specs and even more software optimizations. For those who want to tune into the event, the GTC 2024 keynote will be live-streamed on 18th March (Monday) at 1 PM (Pacific Daylight Time) and last 2 hours till 3 PM so one can expect a very jam-packed presentation by NVIDIA CEO, Jensen Huang. In addition to being live-streamed, this will be the first GTC after many years that will have a proper in-person attendance and we can expect lots of key executives of other companies to show up to announce their support and partnership with NVIDIA. * * * In any event we are not the only ones who view today's GTC presentation as the biggest market event of the week: according to Goldman trader Cullen Morgan, the NVDA GTC Conference presentation by CEO Jensen Huang on Monday 4pm ET will be the most important macro event of the week, with NVDA options implying a +/- 9% move over the next 1-week; which suggests investors expect the presentation to be as impactful as a typical earnings event. The chart below shows that 1-week NVDA implied volatility is higher than ahead of two of the past four earnings events. At the index level, NDX 1-week options are pricing an +/- 2.2% move over the next week and a +/- 1.5% move between now and Tuesday’s close. As Morgan concludes "the Tuesday morning reaction to the NVDA presentation and the Wednesday afternoon reaction to the FOMC statement will likely be the two most important hours of the week for the market." Meanwhile, according to UBS trader Robert Ruple, consistent with the feedback from his recent Nvidia meeting, focal points will likely center around: i) the growth of Inference (stated that around 70% of current total Data Center GPU mix) including the adoption of AI across end-markets with an expanding total addressable market (including greater Enterprise adoption), ii) updates on their roadmap (B100/N100), iii) monetization opportunities from their CUDA/software ecosystem, while addressing the competitive backdrop and China. Structurally, Ruple remains bullish on Nvidia, but he does question if this could be a tactical “sell-the-news” event given all the hype with the stock up 77% year to date and 243% over the last year. Still, it’s tough to fight “city hall” nor the overwhelming enthusiasm for Nvidia/other AI stocks these days. Needless to say, traders are on edge, and in a slightly scaled down version of the recent super wipeout in NVDA stock which saw the company lose a quarter trillion in market cap in one day on March 8, today we have seen a gain of as much as 5.2% evaporate as NVDA stock turned from bright green to red, wiping out tens of billions in market cap, as traders prepare for possible downside after Huang's appearance later today. This would be too easy, right? We will be live streaming the speech when it starts at 4pm ET. Tyler Durden Mon, 03/18/2024 - 14:25.....»»
Trump Says Putting Forward $464 Million Bond "Impossible" In NY Appeal
Trump Says Putting Forward $464 Million Bond "Impossible" In NY Appeal Authored by Catherine Yang via The Epoch Times, Attorneys for former President Donald Trump urged a New York appeals court again on March 18 to remove or lower the $464 million bond President Trump must pay in less than a week as he tries to appeal a more than $350 million judgment from a civil fraud case. “Enforcing an impossible bond requirement as a condition of appeal would inflict manifest irreparable injury on Defendants, and ‘defeat or impair [this Court’s] appellate jurisdiction,’” they argued. The New York Attorney General’s office, which brought the civil fraud lawsuit, argued the appeals court had no authority to do so, while the defense pointed to other cases where it was found appropriate. The bond President Trump would have to put up would include backdated interest at 9 percent, adding another $100 million to the court ordered fine, which defense attorneys say has been improperly classified as disgorgement of ill-gotten gains. Defense attorneys submitted a hefty, nearly 5,000-page reply brief March 18, reopening arguments that had not been accepted during trial after New York Supreme Court Justice Arthur Engoron had already entered a summary judgment finding President Trump liable for fraud. They pointed out, as they had repeatedly, that the case named no victims, and therefore no one would be harmed in a delay of payment. “The case involves no actual victims and no award of restitution, and [the attorney general] is fully protected by Defendants’ real-estate holdings. This factor alone warrants a stay,” the defense argued. “The judgment seeks to destroy a successful business that employs many hardworking New Yorkers, has contributed approximately $300 million in taxes to public coffers just during the dates in question in this case, and has made historic contributions to the State and City of New York.” Attorneys also revealed that 30 companies have already turned down the defense’s bond applications, attaching an affidavit from one of the brokers. A $454 million bond would require President Trump to have $1 billion in cash reserves, and four brokers have separate brokers have tried to obtain one so far to no avail. A ruling is expected from the appeals court in three to six weeks. ‘Manifold Errors’ The attorney general had accused President Trump and other Trump Organization executives of persistent and repeated fraud and artificially inflating President Trump’s net worth through annual statements of financial condition (SFC), which were an informal summary document of Trump Organization assets. After a 45-day bench trial, Justice Engoron had ruled for the plaintiffs on all claims, setting disgorgement at more than $350 million in line with the calculation an expert witness called by the state devised. The judge had also put a ban on President Trump holding a director position in any financial or legal entity in the state for three years or taking out loans from any financial institution chartered in the state, and more limited bans for his sons Eric Trump and Donald Trump Jr. Crucially, he extended the third-party monitorship of Trump Organization, with future reviews based on the monitor’s report for additional penalties including the extension of monitorship and even business certificate cancellations. Defense attorneys argued the judgment was full of “manifold errors,” including the disregard of the statute of limitations set by the appeals court on both claims and disgorgement, the “ridiculously” valuing Mar-a-Lago between $18 million and $27 million, and “a massive disgorgement award in the absence of any evidence that misrepresentations caused the supposedly ill-gotten proceeds.” “Supreme Court double- and triple-counted damages, and committed elementary errors in the process, such as conflating the proceeds of a sale with the profits from that sale,” the defense attorneys argued. “Such basic mistakes would have been prevented if this case had been allowed to be adjudicated in the Commercial Division, where it belonged.” Disgorgement The defense attorneys argued that the disgorgement award was “unconstitutional,” as it violates the excessive fines clause in both the U.S. and New York constitutions, calling it an “irrational, punitive sanction.” “This case has no victims, no damages, and no actual financial losses,” the brief reads. Defendants argue that their business partners—including Deutsche Bank and the Zurich financial group—were “sophisticated” major financial institutions that testified they did their own analyses, were aware of the Trump Organization SFC disclaimers, and would not have changed the terms offered to Trump Organization “in light of the alleged ’misrepresentations’” in the SFCs as the attorney general presented at trial. The massive figure is not an objective one; the state needed to tease out the portion of profit earned by Trump Organization that would have been a result only of inflated numbers presented on the SFCs. The state presented an expert who created formulas to calculate the figure, and defense attorneys sought to show through their own expert testimonies that the profits were not “ill-gotten.” In court filings, the defense also argued that several of these calculations relied on transactions that were outside of the statute of limitations, and faulted the trial court for allowing this. The attorney general had argued that the transactions were, under the continuing wrongs doctrine, distinct violations that each restarted the statute of limitations period, but the appeals court had previously found the doctrine did not apply to this case. “The proper application of this Court’s previous ruling forecloses over 75 percent of the judgment,” the defense argued. About $351 million of the disgorgement, after interest, falls outside the statute of limitations, the defense argued. This covers the loans for Trump National Doral Miami, Trump Golf Links at Ferry Point in New York, and Trump International Hotel and Tower Chicago, all in 2012, as well as the Old Post Office building in Washington in 2013. Yet even with the statute of limitations properly applied, the defense argues there was no show of causation that the alleged misrepresentations on the SFCs resulted in these specific gains. The case was brought under Executive Law § 63(12) and the defense argued the statutes are “inapplicable to the facts of this case in the first place,” and was “wrongfully relied upon” by both the state attorneys and court. The defense attorneys blasted the attorney general for using cases that had no relation to the Executive Law § 63(12), including one involving attorney disbarment, to argue against a stay of penalties during appeal. The appeals court had already temporarily stayed some of the nonmonetary penalties ordered, which the defense argued should continue throughout the appeal. Separately, counsel for Allen Weisselberg, former Trump Organization chief financial officer, joined the appeal. Mr. Weisselberg had pleaded guilty to perjury during the trial in the civil case, in a plea bargain in separate criminal case. Tyler Durden Mon, 03/18/2024 - 14:45.....»»
Sens. Scott, Rubio Call For Plan To Handle Influx Of Haitian Migrants
Sens. Scott, Rubio Call For Plan To Handle Influx Of Haitian Migrants Florida Republican Sens. Rick Scott and Marco Rubio have called on the Biden administration to produce a plan to deal with a potential influx of Haitian migrants into the United States as political and social unrest intensifies in the Caribbean country. Residents flee their homes to escape clashes between armed gangs in the Carrefour-Feuilles district of Port-au-Prince, Haiti, on Aug. 15, 2023. (The Canadian Press/AP-Odelyn Joseph) In a Friday letter to Biden, the senators suggested that the administration's current open-border policy could lead to mass migration from Haiti into the United States, and have a "direct negative impact on American families." "Floridians and the rest of the American public will not tolerate your administration again opening the floodgates for countless, unvetted foreign nationals to stream into our country, putting our national security at grave risk and creating untold public safety threats for our communities," Scott and Rubio wrote. "We must consider this danger due to the numerous reports of gangs committing jailbreaks in Haiti and releasing thousands of dangerous criminals." Earlier this month, Haiti fell into chaos and a state of emergency was declared amid fighting between criminal gangs and government forces - with Haitian Prime Minister Ariel Henry stealing away to Kenya to negotiate a deal for a long-delayed UN-backed security mission (to 'secure the children,' we're sure). The Senators' letter slams Biden for the ongoing crisis at the Southern border, the Epoch Times reports. "Since you took office, your administration has allowed more than 8 million people to pour across our southern border, including untold numbers of foreign nationals that you have released into the interior of the country," they wrote. "You create a magnet for illegal immigration here, appease evil regimes, and put the American people at risk, while further expecting taxpayers to pay for the unrest, humanitarian crises and mass border crossings that result." The letter cites FBI Director Christopher Wray's March 11 comments before the Senate Intelligence Committee in which he raised the alarm about risks to Americans thanks to the Biden administration's open-border policies. According to Wray, the surge in illegal crossings at the southern border threatens the safety of Americans. "From an FBI perspective, we are seeing a wide array of very dangerous threats that emanate from the border," said Wray, who added that the FBI is "very concerned" about a specific human smuggling operation with ties to ISIS. The letter then turns to the potential for mass migration from Haiti, and whether the Biden administration conducts vetting and background checks on Haitians arriving in the US. Rep. Matt Gaetz (R-FL) also raised concerns during a House Armed Services Committee meeting on March 12th, in which he predicted that the current 'trickle' of people leaving Haiti will "accelerate" in the coming weeks - for which south Broward and Palm Beach Counties have been prime destinations for people from the island nation. According to Gaetz "they don’t disperse throughout the country; they stay in southeast Florida." Meanwhile, a top Pentagon official on March 12 said during testimony that the US has no plans to send troops to Haiti, nor activate the Coast Guard and Navy's ability to interdict illegal immigrant flotillas and return them to their point of origin or a port in a 3rd nation. Guantanamo Bay? On March 14, during a press call, White House national security spokesman John F. Kirby said the Biden administration is considering using a naval facility at Guantanamo Bay to process and repatriate illegal immigrants coming from Haiti. The naval station at Guantanamo Bay has been used in the past for processing and repatriating illegal Haitian immigrants, and it “remains an option” for the future if maritime migration trends continue to worsen, according to Mr. Kirby. -Epoch Times On March 7, the Coast Guard interdicted a vessel carrying 65 Haitian immigrants near Inagua, Bahamas, before repatriating them back to Haiti. Tyler Durden Mon, 03/18/2024 - 15:05.....»»
"We"re One Event Away From A 1970s-Style Stagflation Explosion..."
"We're One Event Away From A 1970s-Style Stagflation Explosion..." Excerpted from 'The Turning Point' report via Larry MacDonald's TheBearTrapsReport.com, We hear the comparisons more and more; they are growing louder by the week. “The years 2023-2024 look a lot like 1973-1974.” The history books remind us,1973’s oil embargo shook the global energy market. It also reset geopolitics, reordered the global economy, and a multipolar world saw energy weaponized. After kissing 6% in 1970, in Q1 of 1973, inflation as measured by CPI danced just below 4%, much like today, central bankers were doing the Michael Jackson moonwalk in celebratory form. Then, in bloodcurdling fashion in late 1974, CPI breached 12%. “Don’t be silly, 1973 was a far different set up,” we are told. When it comes to demand on a global stage, 2024 is 2x 1973. Above all, the U.S. is the largest producer of oil in 2024, not as was the case in 1973, when she was the world’s largest petroleum importer. At the time, oil was 50% of world energy consumption vs. 1/3 today. There is just one overwhelming difference today. In the last 8 weeks, we have seen drone technology knock out a) parts of Russia’s second largest airport, b) at least three of Putin’s prize oil refineries, and c) countless ships in the Suez Canal. Weaponizing oil in a multipolar world is exponentially more uncertain with James Cameron calling the shots. In October of 1984, he brought us the “Terminator” and opened the world’s eyes to the future of AI and the weaponization of robots. If Vladimir Putin, on the eve of an election, cannot protect his second-largest airport, how can the Saudi’s protect their own crown jewel. Measuring 280 by 30 km (170 by 19 mi) (some 8,400 square kilometres (3,200 sq mi)), it is by far the largest conventional oil field in the world. That’s a lot of ground to protect. We are one event away from a 1970s-style stagflation explosion. More often than not, recency bias is an investor’s foe. The 2008 and 2020 recessions were similar in that a shock triggered a colossal bond rally along with plunging PMI, ISM and LEI data. It’s more and more apparent by the minute. What we are experiencing today is much more of a 1970s – 1980s recession vintage. An inflation-driven slowdown hits the bottom 60% first, but this time around after the Fed suppressed rates for so, so, so long, higher net worth consumers feel like they died and went to heaven. Revenge consumption has been the economy’s tailwind from those with $1m ($50k annual income vs. $8k in 2021) to $10m ($500k annual income vs. $80k in 2021) in a money market fund. This, plus trillions of fiscal overdosing coming out of Washington have prevented the recession so far, but they have also made inflation’s second act far more certain in a multipolar world. In this note we breakdown the increasing stagflationary landscape. By our count, $500B has moved into Oil & Gas and Metals in recent months. Likewise, oil’s risk to inflation expectations, rates and the -- CRE wounded -- super regional banks is accelerating. What does the world look like if the Fed is forced to ease to protect the banks and the bottom 60% of consumers in an election year -- while inflation is heading north for the summer? Sticky Inflation Both CPI on Tuesday and PPI on Thursday came in hotter than expected. Core CPI rose 3.8% y/y vs +3.7% expected and PPI rose 2% y/y vs 1.9% expected. At the same time, several data points show a slowing economy as well. Retail sales, which were reported simultaneous with the PPI on Thursday, rose 0.6% m/m, which was less than the 0.8% forecast. The prior month was revised lower as well, from -0.8% to -1.1%. In ANOTHER stagflationary turn, the Empire State manufacturing survey for March also came in well below expectations at -21 vs -7 expected. The report noted that “Demand softened as new orders declined significantly, and shipments were lower. Unfilled orders continued to shrink. Labor market indicators weakened, as employment and hours worked both decreased. The pace of input price increases moderated somewhat, while the pace of selling price increases held steady”. BofA in its monthly consumer spending report on Monday said that” consumer spending momentum appears soft, Credit card and debit card spending rose 0.4% m/m, after a 0.3% drop in January.” Oil – High Impact Far and Wide The oil heavy CRB touched its highest level since November Friday. Every day the super-regional banks go without rate cuts, the day of reckoning on market-tomarket losses grows closer to a reality. The Fed opened the door to a softer path, just an inch – that has fueled inflation’s Act II. This has LARGE implications for the banks. Since January 2023; Zions ZION, Comerica CMA and Truist TFC are underperforming the S&P 500 by close to 50%. The NYCB failure has regulators at the OCC and FDIC on the lookout for other Mark-to-Market cheaters. In recent days, we have multiple Ukraine drone attacks on Russian oil refineries, another over the weekend. A multipolar world takes some of the steering wheel away from the Fed with large implications for the banks. Multipolar World - Drone Strikes with High Impact By some estimates, in 2023 the EU imported 130 million barrels of seaborne refined products – mostly diesel – from refineries processing Russian crude. These purchases were worth an estimated €1.1 billion. With some Russian refineries down, Europe must draw more supply from the West, WTI is more than +13% off February levels, +20% off the December lows. The refineries that are processing Russian crude oil and exporting to the EU are largely the same ones sending laundered Russian fuel to the UK and US. The seven largest refineries collectively processed 390 million barrels of Russian crude oil in 2023, valued at an estimated €23 billion. (Global Witness). Connecting the Dots Higher rates + higher inflation expectations are leaving a stain here. Some banks desperately need rate cuts. Where does that leave us? The anxious bond market is now pricing in just 60% odds a rate cut in June and 72bp of rate cuts in 2024. In the upcoming FOMC meeting, some economists are now forecasting the DOT plot to move from 3 to 2 cuts this year. It only takes two Committee members to raise their dot for the median dot to go from 3 cuts to 2 cuts for the year. Odds of Rate Cut The higher the white line above the lower the June rate cut probability. We are back where we were in late February, with June rate hike odds at 60%. (The market prices these odds as an expected move in the Fed Fund futures. So -15bp is a 15bp/25bp=60% chance of a 25bp drop in Fed Funds.) ... "Funny how Nicky-Leaks only mentions the dovish data, failed to mention the Atlanta Fed sticky CPI data out yesterday which showed nice reacceleration" -- Dallas PM. * * * Subscribers can read the full 'Turning Point' report from Larry MacDonald's Bear Traps Report here... Tyler Durden Mon, 03/18/2024 - 15:25.....»»
United Airlines CEO Reassures Everyone Boeing Planes Are Safe After Series Of Incidents
United Airlines CEO Reassures Everyone Boeing Planes Are Safe After Series Of Incidents.....»»
"Guys, I F**ked Up" - SLERF Developer Accidentally Burns Millions As Memecoin-Mania Grows
"Guys, I F**ked Up" - SLERF Developer Accidentally Burns Millions As Memecoin-Mania Grows Authored by Prashant Jha via CoinTelegraph.com, Traders want to make their millions on Solana memecoins, but crypto proponents believe this is risky and would benefit the industry if it ends sooner rather than later... The Solana blockchain has become a hub for new memecoins as the new bull season kicks off with several new memecoins reaching market capitalizations in the billions of dollars within days of launching. One memecoin that has grabbed the crypto community’s attention is Slerf. The creator behind the project mistakenly burnt over $10 million in Solana before the launch, however, despite that the memecoin was launched and reached $500 million market cap within hours. The developer raised 535,000 Solana tokens to launch the memecoin but accidentally burnt $10.4 million worth of Solana tokens while trying to clear their wallet. Jeremy Arnold (@jdotarnold) provided a play-by-play on the farce on X... This guy and a small team created a new memecoin called Slerf. It has something to do with sloths? Who knows. Anyway they pre-sold half the tokens for ~$10m to some 25k buyers. Then the other half were supposed to go on sale starting a few hours ago. Except the guy who created them accidentally burned (deleted) the pre-sale tokens while releasing the new ones. (Don’t ask me how this works. I have no idea.) He’d also already revoked his ownership of the coin, so he couldn’t mint any replacements. Permanent deletion. The outcome was that the $10m got vaporized. Everyone who bought in early lost their deposits and got no Slerfs in return. Here is his initial post on X after realizing he screwed up... Developer burns $10 million of SOL. Source: Slerf on X "It's not my project anymore," the dev continued. "Obviously I don't have $10 million in my pocket to refund everybody, otherwise I'd 100% do it. That is what I'm working on." But this mistake was very good for attention, and attention is the true value of any memecoin. So the obvious thing happened and the new tokens that were released shot up around 5,000%. (This was partially because people realized no existing holders had any coins to sell to drive the price down.) As of the latest data over $1.5BN in volume has been traded on SLERF. The Slerf team later went to an X Spaces to elaborate further on the situation. "I'm sick to my stomach," team member Slorg said in a Space on X. "I'm literally about to throw up." "I'm lost for words," they added. "I don't know what to do." But the developer found a silver lining... The impact on Solana itself can be seen here... As TheBlock.co reports, the latest mishap follows a weekend rife with Solana-based memecoin presales, during which various random projects emerged and received significant funding, often amounting to millions of dollars. The memecoin frenzy has led to comparisons with the Ethereum initial coin offering (ICO) era bubble of 2017 when several crypto projects raised millions of dollars but many failed to deliver. It appears traders are swapping from ETH to SOL to jump on the memecoin mania Memecoins are cryptocurrencies stemming from an internet meme or having some other humorous characteristic, but they lack any real-world use case other than being a pop culture reference. These cryptocurrencies are highly speculative and supported by some enthusiastic online communities. Dogecoin is considered the OG memecoin and received support from Elon Musk during the 2021 bull market. In 2024, multiple memecoins, some barely a week old, have reached billions in market capitalization, creating new crypto millionaires by the hour. The recent comparison to the ICO presale era of 2017 comes amid many influencers managing to raise millions of dollars in presales to launch new memecoins. Users on X compared the current memecoin offerings (MCOs) to the Ethereum ICO bubble in 2017 when several crypto projects promised to deliver only to vanish after raising funds. A 2018 report indicated that over 90% of ICO projects failed. Similarly, there have been several instances where influencers have run away with the presale money or have dumped it on the market right after the launch. One user on X said the memecoin mania is a more honest version of the 2017 ICO craze and the 2021 nonfungible token/crypto-art bubble, as projects “no longer have to pretend to deliver on a fake white paper and investors no longer have to pretend to be in it for the art.” Scammer defrauding people during thememecoin frenzy. Source: ZachXBT on X Stories of a few traders making millions of dollars in a couple of days often attract several others to try their luck. However, on most occasions, they lose a significant chunk of their investment. A trader’s memecoin portfolio. Source: Elja on X Crypto proponents claim the memecoin bubble will eventually liquidate millions of new users who blindly put their money into technology with no utility. Tyler Durden Mon, 03/18/2024 - 10:50.....»»
Caribbean-Spring? Protests Erupt In Cuba Amid Food Shortages, Blackouts
Caribbean-Spring? Protests Erupt In Cuba Amid Food Shortages, Blackouts.....»»
Fallout Continues Over Trump "Bloodbath" Media Hoax
Fallout Continues Over Trump "Bloodbath" Media Hoax.....»»
Putin Warns Of "Full-Scale WW3" If West Sends Troops To Ukraine
Putin Warns Of 'Full-Scale WW3' If West Sends Troops To Ukraine Russian President Vladimir Putin's election victory speech and Q&A with the press was full of familiar themes, but he used the occasion after capturing a record 87% of the vote to warn the US and Europe that a "full-scale World War III" is "possible" should any Western troops enter Ukraine. The remarks came in response to a journalist's question on President Macron's recent statements saying he thinks sending troops to Ukraine should be a realistic possibility. Putin responded on Sunday: "I think anything is possible in today’s world and it’s clear to everyone that this would be one step from a full-scale World War III." Putin But the Russian leader also emphasized that NATO military personnel are already present in Ukraine, with Russian intelligence having observed English and French at times being spoken on the battlefield. "There is nothing good in this, first of all for them, because they are dying there and in large numbers," he said. Putin said, "It seems that France could play a role. All is not lost yet." Over the weekend French President Macron floated the idea of a Ukraine ceasefire during the Paris Olympics, which is set to take place from July 26 to August 11 of this year: France wants Russia to observe a cease-fire in Ukraine during this summer’s Olympic Games in Paris, French President Emmanuel Macron said in an interview with Ukrainian television on Saturday. "This is a message of peace," Macron said, before a voiceover interpreter quoted the French president as saying that France is doing so in line with the spirit of the Olympic movement. Putin appeared to respond to this overture, saying in his Sunday address: "I’ve been saying it over and over again and I’ll say it again. We are for peace talks, but not just because the enemy is running out of bullets," Putin stated. "If they really, seriously, want to build peaceful, good-neighborly relations between the two states in the long term, and not simply take a break for rearmament for 1.5-2 years." The Kremlin followed up later with this exchange: Commenting on the French President’s call for a ceasefire, Russian foreign ministry spokeswoman Maria Zakharova urged Macron to stop weapon supplies to Ukraine, the TASS news agency reported. Zakharova also said Macron should have proposed the same ceasefire to the sides of the conflict in the Middle East. Putin elsewhere presented his re-election to another six year term as proof that the Russian populace stands behind him in defending Russia in the 'special military operation' in Ukraine. "Dear friends, it's a great pleasure this evening to be with members of my team, with members of my team, people who think alike, who have the same goals. But let's think about this word, where it came from, comrade in arms, or teammates." He stressed, "The votes of all citizens of Russia express the united will of the Russian Federation." “Everything is possible in the modern world. But it is clear to everyone that this is a step towards World War III. Hardly anyone is interested in this.” - President Putin responds to @EmmanuelMacron pic.twitter.com/Ox4kNetHH6 — African (@ali_naka) March 18, 2024 He juxtaposed his 'mandate' with the state of affairs in America. "The whole world is laughing at what is happening there," he said of the United States. "It is just a catastrophe — it is not democracy — what on earth is it?" Putin was also asked about deceased opposition leader Alexei Navalny, who died Feb.16 in a far northern prison of what was officially listed as 'natural causes'. Putin confirmed reports that a major prisoner swap with the West was about to happen just before his "sad" death. On this swap which had been in the works just days before Navalny's unexpected death, Putin explained: "I said: ‘I am agreed’. I had one condition — we exchange him but he never returns." Concerning the future of the war in Ukraine at a moment cross-border drone attacks have ramped up on Russian cities and energy infrastructure, Putin spoke of possibly establishing a major buffer zone. "I do not exclude that, bearing in mind the tragic events taking place today, we will be forced at some point, when we deem it appropriate, to create a certain ‘sanitary zone’ in the territories today under the Kyiv regime," Putin said, but without giving further details. Tyler Durden Mon, 03/18/2024 - 11:50.....»»
Half Of Downtown Pittsburgh Office Space Could Be Empty In 4 Years
Half Of Downtown Pittsburgh Office Space Could Be Empty In 4 Years Authored by Mike Shedlock via MishTalk.com, The CRE implosion is picking up steam. Check out the grim stats on Pittsburgh. Unions are also a problem in Pittsburgh as they are in Illinois and California. Downtown Pittsburgh Implosion The Post Gazette reports nearly half of Downtown Pittsburgh office space could be empty in 4 years. Confidential real estate information obtained by the Pittsburgh Post-Gazette estimates that 17 buildings are in “significant distress” and another nine are in “pending distress,” meaning they are either approaching foreclosure or at risk of foreclosure. Those properties represent 63% of the Downtown office stock and account for $30.5 million in real estate taxes, according to the data. It also calculates the current office vacancy rate at 27% when subleases are factored in — one of the highest in the country. And with an additional three million square feet of unoccupied leased space becoming available over the next five years, the vacancy rate could soar to 46% by 2028, based on the data. Property assessments on 10 buildings, including U.S. Steel Tower, PPG Place, and the Tower at PNC Plaza, have been slashed by $364.4 million for the 2023 tax year, as high vacancies drive down their income. Another factor has been the steep drop — to 63.5% from 87.5% — in the common level ratio, the number used to compute taxable value in county assessment appeal hearings. The assessment cuts have the potential to cost the city, the county, and the Pittsburgh schools nearly $8.4 million in tax refunds for that year alone. Downtown represents nearly 25% of the city’s overall tax base. In response Pittsburgh City Councilman Bobby Wilson wants to remove a $250,000 limit on the amount of tax relief available to a building owner or developer as long as a project creates at least 50 full-time equivalent jobs. It’s unclear if the proposal will be enough. Annual interest costs to borrow $1 million have soared from $32,500 at the start of the pandemic in 2020 to $85,000 on March 1. Local construction costs have increased by about 30% since 2019. But the city is doomed if it does nothing. Aaron Stauber, president of Rugby Realty said it will probably empty out Gulf Tower and mothball it once all existing leases expire. “It’s cheaper to just shut the lights off,” he said. “At some point, we would move on to greener pastures.” Where’s There’s Smoke There’s Unions In addition to the commercial real estate woes, the city is also wrestling with union contracts. Please consider Sounding the alarm: Pittsburgh Controller’s letter should kick off fiscal soul-searching It’s only March, and Pittsburgh’s 2024 house-of-cards operating budget is already falling down. That’s the clear implication of a letter sent by new City Controller Rachael Heisler to Mayor Ed Gainey and members of City Council on Wednesday afternoon. The letter is a rare and welcome expression of urgency in a city government that has fallen in complacency — and is close to falling into fiscal disaster. The approaching crisis was thrown into sharp relief this week, when City Council approved amendments to the operating budget accounting for a pricey new contract with the firefighters union. The Post-Gazette Editorial Board had predicted that this contract — plus two others yet to be announced and approved — would demonstrate the dishonesty of Mayor Ed Gainey’s budget, and that’s exactly what’s happening: The new contract is adding $11 million to the administration’s artificially low 5-year spending projections, bringing expected 2028 reserves to just barely the legal limit. But there’s still two big contracts to go, with the EMS union and the Pittsburgh Joint Collective Bargaining Committee, which covers Public Works workers. Worse, there are tens — possibly hundreds — of millions in unrealistic revenues still on the books. On this, Ms. Heisler’s letter only scratched the surface. Similarly, as we have observed, the budget’s real estate tax revenue projections are radically inconsistent with reality. Due to high vacancies and a sharp reduction in the common level ratio, a significant drop in revenues was predictable — but not reflected in the budget. Ms. Heisler’s estimate of a 20% drop in revenues from Downtown property, or $5.3 million a year, may even be optimistic: Other estimates peg the loss at twice that, or more. Left unmentioned in the letter are massive property tax refunds the city will owe, as well as fanciful projections of interest income that are inconsistent with the dwindling reserves, and drawing-down of federal COVID relief funds, predicted in the budget itself. That’s another unrealistic $80 million over five years. Pittsburgh exited Act 47 state oversight after nearly 15 years on Feb. 12, 2018, with a clean bill of fiscal health. It has already ruined that bill of health. Act 47 in Pittsburgh Flashback February 21, 2018: Act 47 in Pittsburgh: What Was Accomplished? Pittsburgh’s tax structure was a much-complained-about topic leading up to the Act 47 declaration. The year following Pittsburgh’s designation as financially distressed under Act 47 it levied taxes on real estate, real estate transfers, parking, earned income, business gross receipts (business privilege and mercantile), occupational privilege and amusements. The General Assembly enacted tax reforms in 2004 giving the city authority to levy a payroll preparation tax in exchange for the immediate elimination of the mercantile tax and the phase out of the business privilege tax. The tax reforms increased the amount of the occupational privilege tax from $10 to $52 (this is today known as the local services tax and all municipalities outside of Philadelphia levy it and could raise it thanks to the change for Pittsburgh). The coordinators recommended an increase in the deed transfer tax, which occurred in late 2004 (it was just increased again by City Council) and in the real estate tax, which increased in 2015. Legacy costs, principally debt and underfunded pensions, were the primary focus of the 2009 amended recovery plan. The city’s pension funded ratio has increased significantly from where it stood a decade ago, rising from the mid-30 percent range to over 60 percent at last measurement. The obvious question? Will the city stick to the steps taken to improve financially and avoid slipping back into distressed status? If Pittsburgh once stood “on the precipice of full-blown crisis,” as described in the first recovery plan, hopefully it won’t return to that position. The Obvious Question I could have answered the 2018 obvious question with the obvious answer. Hell no. No matter how much you raise taxes, it will never be enough because public unions will suck every penny and want more. On top of union graft, and insanely woke policies in California, we have an additional huge problem. Hybrid Work Leaves Offices Empty and Building Owners Reeling Hybrid work has put office building owners in a bind and could pose a risk to banks. Landlords are now confronting the fact that some of their office buildings have become obsolete, if not worthless. Meanwhile, in Illinois … Chicago Teachers’ Union Seeks $50 Billion Despite $700 Million City Deficit Please note the Chicago Teachers’ Union Seeks $50 Billion Despite $700 Million City Deficit The CTU wants to raise taxes across the board, especially targeting real estate. My suggestion, get the hell out... Tyler Durden Mon, 03/18/2024 - 12:10.....»»
"Less Flights And More Full Aircraft": Airlines Stung By Boeing Delays Ahead Of Busy Summer Travel Season
"Less Flights And More Full Aircraft": Airlines Stung By Boeing Delays Ahead Of Busy Summer Travel Season The incessant stream of bad news for Boeing is starting to take its toll on airlines, according to Bloomberg, who noted this weekend that companies like United, Southwest and Ryanair are all stuck dealing with reduced deliveries from Boeing while the planemaker turns its attention to quality control. Ahead of the busy summer travel season, airlines are adjusting schedules and seeking alternatives to Boeing 737s due to these delays, while also grappling with the fact that Airbus narrowbody delays. The timeline for Boeing's aircraft readiness remains uncertain as U.S. inspectors examine its factories, preventing definitive forecasts for a return to normal operations. Airbus, Boeing's chief rival, is mostly booked until the decade's end, Bloomberg writes, leaving limited options for airlines. Both manufacturers face challenges in ramping up production to pre-pandemic levels, with Airbus also dealing with engine-wear problems that have grounded numerous planes, exacerbating the shortage amid soaring airline demand. In the U.S., domestic flight prices have increased following a drop from post-pandemic peaks. For instance, lack of added capacity on routes such as New York to Los Angeles is expected to push business-class fares up by as much as 8.5% during the summer peak. Similarly, fares between Seattle and San Francisco, as well as Chicago and Las Vegas, could see rises of up to 18% and 9.6%, respectively, the report says. While the overall direction of U.S. flight prices had seen a decline after a surge in 2022 and early 2023, the latest government data indicates a 3.6% increase from January to February, marking the most significant monthly rise since May 2022. Boeing faces an uncertain 2024, with production of the 737 capped at 38 per month by regulators, despite only 42 being delivered in the first two months of the year. Company officials hope to reach this production rate later in the year. John Plueger, chief executive officer of aircraft leasing company Air Lease Corp. told Bloomberg: “All they’re saying is as you’d expect: ‘We are working as hard as we can. We are sorry for your disruption. We’re doing the best we can. As soon as we have certainty, we will advise you.’ They are saying that.” Steven Townend, who heads aircraft lessor BOC Aviation Ltd., said on Bloomberg this week: “This is not just a this-year problem. This has been a multiyear issue. It is going to take several years to really catch back up again.” “You’ll see less flights and more full aircraft” this summer, said Plueger. Tyler Durden Mon, 03/18/2024 - 12:30.....»»
Macron"s Long Telegram
Macron's Long Telegram By Benjamin Picton, Senior Macro Strategist at Rabobank The focus of markets last week was, quite rightly, on US inflation figures. US 2-year yields posted gains every day to close the week just over 25bps higher at 4.73%. The move was prodded along by stronger-than-expected US CPI on Tuesday, strong PPI on Thursday, and then rising prices for goods imports on Friday. So, it was a trio of bad news on the inflation front, with the goods imports inflation providing the cherry on top because disinflation in internationally-traded goods has been doing the heavy lifting for the Fed (and others) up until now. Perhaps unsurprisingly, market pricing on the quantum of cuts expected from the Fed this year fell from 4.2 last Monday to 3.3 as of this morning. The S&P500 picked up on the vibe by closing lower for the second week in a row. That hasn’t happened since October of last year, which happened to be the cyclical low before Jerome Powell’s ‘pivot’ lit the fuse on a whopping Santa rally that has survived well into 2024. This week will be dominated by central bank actions, even though we fully expect that actual action in the form of shifting policy rates will be pretty thin on the ground. The BOJ will be a major point of interest on Tuesday, with markets now pricing in a 55% probability of an end to the negative interest rates policy (NIRP). A return to ZIRP (zero interest rates policy) is seen as a 70% probability by the April meeting, or 96% by June. Markets have been gradually bidding up the implied path of the BOJ’s policy rate for weeks as Japanese unions deliver strong wage gains for their members. Rengo, Japan’s largest labour union, last week secured wage increases of ~5.25% for members. That’s the first time in more than 30 years that wage gains have exceeded 5%. BOJ Governor Kazuo Ueda has stressed in the past that he would need to see evidence of persistent wage growth to be convinced that inflation will converge on the 2% target. Given the events of last week, a lift in the policy rate tomorrow is a certainly a possibility but given past dovishness it seems more likely that the BOJ will hold fire until April. Tomorrow also brings the RBA’s March policy meeting. We expect no change to the policy rate or the bank’s slight hawkish bias, especially since the RBA meeting will predate the February labour market report by two days. We’re forecasting the unemployment rate to dip to 4%, and for the economy to have added 24,500 jobs last month. That will be sufficient to trigger the Sahm Rule, which might explain why Aussie Treasurer Chalmers has recently started the softening-up process for a more growth-oriented budged in May. The RBA’s Financial Stability Review on Friday will also make for interesting reading, especially with regards to Australia’s gravity-defying mortgage market. Of course, the main event for the week will be the outcome of the March FOMC meeting on Wednesday. Our Senior US Strategist Philip Marey expects no change to the Fed Funds rate this week and maintains our call for the first cut of the cycle to arrive in June. Philip notes that the Fed will give in-depth consideration to the pace of balance sheet runoff at this week’s meeting. Any lowering of $95bn ‘passive QT’ combined monthly cap for Treasuries, MBS and agency debt would be an encouragement for equity managers looking for a fresh round of monetary stim. The Bank of England also meets this week and will publish their decision on the Bank Rate on Thursday. We’re expecting no changes there either. Stefan Koopman, our Senior Macro Strategist covering the UK thinks that the BOE will trail both the Fed and the ECB in delivering any policy easing, despite signs of softening in labour markets. If equity markets do take encouragement from central bankers this week, it will be in defiance of a geopolitical environment threatening escalation. Crude oil last Thursday joined other asset classes making year-to-date highs. That coincided with Russian state media reporting claims that the Houthis now have a hypersonic missile, and comments from Houthi Supreme leader Abdul Malik al-Houthi where he said that the group will begin targeting ships heading around the Cape of Good Hope at Africa’s Southern tip. If the Houthis DO possess a hypersonic missile (a big ‘if’), it could only have come from Russia (by way of Iran) and would pose a worrying risk to US and allied navies operating in the area. The targeting of commercial shipping taking the long route to Europe via the Cape of Good Hope would be a further detriment for insurance costs and would deal a blow to prospects of an ECB rate cut in June. Last week also saw a stunning interview delivered by French President Emmanuel Macron. We touched on this on Friday, but it bears repeating that Macron is now taking a much firmer line on the War in Ukraine. Macron’s interview follows Vladimir Putin’s well-publicized history lecture of Tucker Carlson, and news that Russia has shifted tactical nuclear weapons westward into Belarus. It also came just before the weekend’s Russian elections, where Putin dubiously secured 88% of the vote. In this context, there are echoes of George Kennan’s ‘Long Telegram’ that established the US policy of Soviet containment in the 1940s. Macron’s speech reads like a greatest hits of Realpolitik. Europe must do ”whatever it takes”. “If Russia wins this war, Europe’s credibility will be reduced to zero.” “If Ukraine were to fall, our security is threatened. And so, the time has come to resist.” “If the situation were to deteriorate, we have to be ready, and we will be ready. We will be ready to make the decisions to ensure that Russia never wins.” These comments arrive in the context of Macron’s earlier refusal to rule out committing French troops to fighting in Ukraine. That was met with threats from Putin and denials from European counterparts that “boots on the ground” could ever happen. Seemingly addressing this, Macron said: “Two years ago we said we would never send a tank. We did. Two years ago we said we would never send medium-range missiles. We did. We said we would never send planes. Some are now in the process. We set too many limits.” Christine Lagarde is famously on the record saying that the ECB’s commitment to the Euro has “no limits”. Macron is making the same commitment on security. Tyler Durden Mon, 03/18/2024 - 12:50.....»»
Biden Blames Trump For Derailing The Border Deal... But Are Voters Buying It?
Biden Blames Trump For Derailing The Border Deal... But Are Voters Buying It? Authored by Emel Akan via The Epoch Times (emphasis ours), The border crisis is putting President Joe Biden in a tough spot. His approval ratings have suffered due to the ongoing problem, but he’s now trying to leverage the failure of the Senate border bill to blame former President Donald Trump for the crisis. “Every day between now and November, the American people are going to know that the only reason the border is not secure is Donald Trump and his MAGA Republican friends,” President Biden said in early February after Republicans in Congress tanked a bipartisan border bill he was prepared to sign into law. (Illustration by The Epoch Times, Getty Images) However, recent polls show that the president’s message doesn’t appear to be resonating with independent voters and many of his supporters, who are concerned about his failure to address the border issue. In his recent State of the Union address, President Biden continued to shift the blame to his predecessor and Republicans in Congress, saying “politics have derailed” his recent border deal. “We can fight about the border, or we can fix it. I’m ready to fix it. Send me the border bill now,” he said in a fiery address. However, Democrats are divided on the issue. Progressives are against any potential limitation on asylum. They want to safeguard the ability of illegal immigrants to seek asylum at the border. In the early days of the Biden administration, they played a significant role in shaping the immigration policy of the president and reversing the Trump administration’s border measures. Meanwhile, Democrats in red or swing states and districts express concern about the surge in illegal crossings. They call on President Biden to take executive action to address the problem. Sen. Jon Tester (D-Mont.), a rare red state Democrat in the Senate, sent a letter to President Biden on Feb. 29 urging him to to secure the border. “What’s happening at the southern border is unacceptable, plain and simple,” he wrote in the letter. “I respectfully urge you to use all of the remaining tools at your disposal to strengthen border security where executive action is possible.” President Joe Biden speaks with Border Patrol agents near the U.S.–Mexico border in Brownsville, Texas, on Feb. 29, 2024. (Jim Watson/AFP via Getty Images) The Majority Wants Trump’s Border Wall More than 6 in 10 Americans describe illegal immigration as a very serious problem, a new Monmouth University poll found. The same poll showed 53 percent of Americans support building a border wall along the U.S. border with Mexico. This marks the first time a majority of respondents have backed the measure since the polling institute began asking the question in 2015. During the Trump administration, support for building a wall didn’t rise above 44 percent. Republicans and independents showed strong support for a border wall in the most recent survey, with 86 percent and 58 percent in favor, respectively. In contrast, only 17 percent of Democrats supported the idea. “Illegal immigration has taken center stage as a defining issue this presidential election year. Other Monmouth polling found this to be Biden’s weakest policy area, including among his fellow Democrats,” Patrick Murray, director of the independent Monmouth University Polling Institute, said in a statement. Meanwhile, 61 percent of respondents support President Trump’s “Remain in Mexico” program, according to the same poll. The Trump administration implemented the program, which requires would-be asylum-seekers to remain in Mexico while their claims are processed. On his first day in office, President Biden stopped adding illegal immigrants to the “Remain in Mexico” program and began releasing more illegal immigrants into the United States. In October 2021, Secretary Mayorkas issued a memo repealing the program in its entirety. Mr. Mayorkas claimed that asylum seekers had been “exposed to harm while waiting in Mexico” under the scheme. However, the program has been touted by border security advocates for its effectiveness in curbing illegal immigration because it ended “catch-and-release,” the practice in which illegal immigrants are released into the United States with a court date far in the future. The U.S. border wall in Jacumba, Calif., on Feb 22, 2024. (John Fredricks/The Epoch Times) ‘Too Little, Too Late’ Just a week before his State of the Union address, President Biden made a trip to the southern border to amplify his message that Republicans thwarted his border deal. His visit to Brownsville, Texas, coincided with former President Trump’s trip to Eagle Pass, Texas. The National Border Patrol Council, which supported the border agreement, slammed the president’s planned trip to Brownsville as a tactic to rescue his presidency, calling it “too little, too late.” Brownsville was once a hot spot for illegal immigration on the southern border. The city declared a state of emergency in May 2023. John Cowen, mayor of Brownsville, stated that his city, with fewer than 200,000 residents, has helped more than 240,000 illegal immigrants since 2021. The illegal crossings have decreased notably in recent months, thanks partly to the Texas governor’s initiatives to prevent illegal immigration, including building anti-climb barriers and turning illegal immigrants back to Mexico. It had been the busiest region for illegal crossings at the U.S.-Mexico border for about a decade. Pedro Cardenas, a commissioner for the city of Brownsville, believes that the influx is not over. He says there are thousands of migrants in Matamoros, Mexico, on the other side of the border waiting for their appointment under the new U.S. government’s phone app program. As part of President Biden’s expanded parole program, asylum seekers can schedule an appointment using the Customs and Border Protection’s (CBP) phone app, known as CBP One, while waiting outside the country. Migrants who obtain an appointment can enter the United States via a port of entry and apply for a work permit after being released from U.S. custody. Conservatives have slammed the president’s decision to expand the program, accusing him of misusing the administration’s immigration authority. Illegal immigrants gather after crossing the U.S. border wall in Jacumba, Calif., on Jan. 10, 2024. (John Fredricks/The Epoch Times) Mr. Cardenas, who voted for Joe Biden in 2020, told the Epoch Times that the president’s visit was overdue. “I think he should have been here a little earlier,” he said. “When we had thousands of people crossing daily, he was not here.” Mr. Cardenas said that he would wait to see how things unfold in the coming months before deciding on whether to vote for President Biden in November. He said he wants to see a shift in policy and concrete steps from the president to address the border problem. Martin Aguilera, 50, is the son of migrants from Mexico. He was born and raised in Brownsville. He blames both President Biden and Mexican President Andrés Manuel López Obrador for the border crisis. “I voted for President Biden. I thought he was going to be a good president. But I don’t see that,” he told The Epoch Times. “I’m a Democrat, but I’m going to vote for Trump.” Mr. Aguilera said that the 2024 election will be his first time voting for a Republican president. “My mother and father came from Mexico, and they came to work legally,” Mr. Aguilera said. He’s upset about how his and other taxpayers’ money is being spent on illegal immigrants. He criticized, for example, the Southwest Key program in his county, which receives funding from the federal government to offer shelter for unaccompanied minors through the Department of Health and Human Services. “Those kids misbehave. They do whatever they want. They fight with other people. Nobody can do anything about it because the government is protecting those kids. They get the best food. They get the best clothes. Who pays? We’re paying for them,” he said. “They receive special treatment, including psychologists, doctors, and eye doctors. They get everything for free. If I want to see a doctor, I have to pay a lot of money.” Read more here... Tyler Durden Mon, 03/18/2024 - 13:25.....»»
Exxon Chief Darren Woods Has Conquered The Woke ESG Giant
Exxon Chief Darren Woods Has Conquered The Woke ESG Giant Exxon CEO Darren Woods isn't mincing words or actions as the broader market has finally started to turn its back on the 'ESG' fallacy. And we can expect more of the same when Woods speaks at the CERAWeek by S&P Global energy conference in Houston this week. So far this year, Woods initiated arbitration against Chevron Corp. for trying to invest in Exxon's large offshore oil project in Guyana and has sued investors pushing for emission reductions, according to Yahoo/Bloomberg. Prior to that, he orchestrated a $60 billion acquisition, positioning Exxon as the top U.S. shale producer. Woods has also intensified his stance on climate objectives, asserting in speeches and interviews that fossil fuels remain essential to fulfill energy needs for the foreseeable future. He argues that achieving net-zero carbon emissions by 2050 is unrealistic, as there's a general reluctance to bear the costs of cleaner alternatives. Jeff Wyll, a senior analyst at Neuberger Berman, told Bloomberg: “It wasn’t that long ago it looked like taking the green approach was what the industry needed to attract capital.” But he said the Russia/Ukraine conflict “flipped the switch and energy security became more important. Exxon benefited because they never stepped back from their traditional business.” As Bloomberg notes, Woods is drawing lessons from his interactions with activist shareholders, leading Exxon to sue climate investors in the U.S. and the Netherlands in January for pushing for emissions reductions. The lawsuit claims the current system for shareholder voting is susceptible to exploitation by activists holding few shares without a focus on long-term value. He's also not against openly discussing the challenges of transitioning to a lower-carbon economy, which he did in a recent Fortune podcast. He spoke about the often-overlooked costs of emission reduction efforts and noted that the world has delayed action on finding comprehensive solutions. Greg Buckley, a portfolio manager at Adams Funds, added: “ESG was popular but I think that return on capital is more popular at the end of the day. Shell and BP found out the hard way.” “Facts that don’t align with ill-informed prejudice are often infuriating. That doesn’t make them wrong. Someone needs to tell the truth about what it’s going to take to get to a net-zero future,” Emily Mir, a spokeswoman for Exxon, commented. Dan Yergin, vice chairman of S&P Global added: "The energy companies have demonstrated a discipline in their capital investment and have been responsive to investors. You can see that in their spending and that's refurbished the social contract between the companies and investors.” Just weeks ago we noted how Wall Street was starting to ditch its ESG lingo. For some context, peak ESG and related synonyms, such as "climate change" and "clean energy" and green energy" and net zero," among other terms, peaked at 28,000 mentions in the first quarter of 2022. Ever since, the number of mentions has rapidly plunged. Halfway through the first quarter earnings season, mentions are around 4,800. Recall, we also wrote last year about the dying off of ESG and "green" investment products. Most recently, at the end of 2023, Goldman Sachs shuttered its ActiveBeta Paris-Aligned Climate U.S. Large Cap Equity ETF. Bloomberg ETF analyst Eric Balchunas pointed out in late 2023 that "there was just way too much supply for the demand" with the ETF and that "it's going to get worse too". Balchunas says the ETF only took in $7 million over the course of 2 years. We also wrote about Jeff Ubben late last year, who shuttered his sustainability fund - calling traditional climate summitry an “echo chamber” of diplomats. Less than a week before that we noted that $30 billion had been shaved off the value of clean energy stocks over the preceding 6 months. Finally, we pointed out last year how the ESG grift was reaching endgame after Markus Müller, chief investment officer ESG at Deutsche Bank's Private Bank stated that sustainability funds should include traditional energy stocks, arguing that not doing so deprives investors of a prime opportunity to invest in the transition to renewable energy. Tyler Durden Mon, 03/18/2024 - 13:45.....»»
Taibbi Dismantles "Absurd" NYT Hit Piece
Taibbi Dismantles 'Absurd' NYT Hit Piece Heading into the 2024 election, corporate media is once again spinning lies in order to re-frame, or contain, legitimate news stories. In his latest reports, Racket News' Matt Taibbi corrects the record after a desperate slam job on the Twitter Files, published by The New York Times ("We seek the truth and help people understand the world") just before oral arguments in a historic First Amendment case in the Supreme Court... In advance of oral arguments tomorrow in the Supreme Court for Murthy v. Missouri, formerly Missouri v. Biden, the New York Times and authors Jim Rutenberg and Steven Lee Myers wrote a craven and dishonest piece called, “How Trump’s Allies Are Winning the War Over Disinformation.” The Times implies both the Twitter Files reports and my congressional testimony with Michael Shellenberger were strongly influenced by former Trump administration official Mike Benz, whose profile occupies much of the text. Benz is described as a purveyor of “conspiracy theories, like the one about the Pentagon’s use of Taylor Swift,” that are “talking points for many Republicans.” They quote Shellenberger as saying meeting Benz was the “Aha moment,” in our coverage, and the entire premise of the piece is that Benz and other “Trump allies” pushed Michael, me, and the rest of the Twitter Files reporters into aiding a “counteroffensive” in the war against disinformation, helping keep social media a home for “antidemocratic tactics.” This all has a strong whiff of setup. I have nothing to say against Mike Benz, but let’s set some things straight. As Rutenberg and Lee Myers themselves note, I first talked to Benz in March, 2023. The Twitter Files reports were virtually all done by then. I would publish just two more, one on the day of my testimony, March 9, 2023 (“The Censorship-Industrial Complex”) and one on March 17 (“Stanford, the Virality Project, and the Censorship of ‘True Stories’”). Mike was the source for exactly one piece of information in those two stories: a video his Foundation for Freedom Online posted of Stanford Internet Observatory director Alex Stamos, in which Stamos said Stanford’s Election Integrity Partnership was created to “fill the gap of things the government couldn’t do” legally: This was true, public, and newsworthy, not a “conspiracy theory” about Taylor Swift or anyone else. Did “Trump Allies” force Stamos to put that video on YouTube? Rutenberg and Lee Myers imply Benz influenced a change in my personal reporting, since I didn’t discover “evidence of direct government involvement” in the first installment of the Twitter Files about the Hunter Biden laptop story: The author of that dispatch, Mr. Taibbi, concluded that Twitter had limited the coverage amid general warnings from the F.B.I. that Russia could leak hacked materials to try to influence the 2020 election. Though he was critical of previous leadership at Twitter, he reported that he saw no evidence of direct government involvement. In March 2023, Mr. Benz joined the fray. Both Mr. Taibbi and Mr. Benz participated in a live discussion on Twitter, which was co-hosted by Jennifer Lynn Lawrence, an organizer of the Trump rally that preceded the riot on Jan. 6… As Mr. Taibbi described his work, Mr. Benz jumped in: “I believe I have all of the missing pieces of the puzzle.” There was a far broader “scale of censorship the world has never experienced before,” he told Mr. Taibbi, who made plans to follow up. Nice try. Though I didn’t find “direct evidence” of government involvement in censorship programs in the first Twitter Files piece, we did discover it, on a grand scale, almost immediately after. Subsequent Twitter Files reports reflected this, including “Twitter, the FBI Subsidiary” from December 16th, 2022, and the “Twitter and Other Government Agencies” story published on Christmas Eve of 2022, the day the IRS opened a case on me. Shellenberger, Bari Weiss, Lee Fang, and other Twitter Files reporters discovered the key elements of the Twitter Files reports, from the “industry calls” held between the FBI and Internet platforms like Twitter, to the role of Stanford’s Election Integrity Partnership, to the role of the State Department’s Global Engagement Center in sponsoring “anti-disinformation” work, in the first two weeks of research. Our central thesis about state-sponsored censorship was online months before we met Benz. By mid-December 2022, I knew we were looking at a sweeping federal content-control program, and repeated the idea many times. As I wrote on Christmas Eve, 2022: The files show the FBI acting as doorman to a vast program of social media surveillance and censorship, encompassing agencies across the federal government —from the State Department to the Pentagon to the CIA… The operation is far bigger than the reported 80 members of the Foreign Influence Task Force (FITF)… Twitter had so much contact with so many agencies that executives lost track. Nonetheless, the gist of today’s Times piece is that Shellenberger and I got this thesis from Benz. They literally wrote it that way, that when I testified to Congress, I was presenting his thesis: Later, Mr. Shellenberger said that connecting with Mr. Benz had led to “a big aha moment…” A week after that online meeting, Mr. Taibbi and Mr. Shellenberger appeared on Capitol Hill as star witnesses for the Select Subcommittee on the Weaponization of the Federal Government. Mr. Benz sat behind them, listening as they detailed parts of his central thesis: This was not an imperfect attempt to balance free speech with democratic rights but a state-sponsored thought-policing system. Michael, Bari, Lee, David Zweig and others involved with the Twitter Files project have been subject to a lot of silly smear jobs in the last year-plus, but this piece of deep state fan fiction in the Times is low even by their standards. It’s clearly intended to re-cast the outing of federal censorship initiatives as Trumpian conspiracy theory before oral arguments begin in Murthy v. Missouri tomorrow. As the Times notes, this is one of “the most important First Amendment cases of the internet age,” and “could curtail the government’s latitude in monitoring content online.” Originally filed by the Attorneys General of Louisiana and Missouri, the lawsuit “accuses federal officials of colluding with or coercing the platforms to censor content critical of the government.” The reason the government faces such danger is because two lower courts have already affirmed the core accusation that multiple Executive Branch agencies, including the White House and the FBI, violated the First Amendment when they engaged in mass-flagging programs of the type identified in both the Twitter Files and the original Missouri v. Biden complaint. After these lower court decisions, the Times notes with sadness, “the Biden administration has largely abandoned moves that might be construed as stifling political speech,” facing as it now does the specter of “legal and political blowback.” The administration faces this blowback because the story about the censorship programs is true. The Times didn’t bother trying to argue we got anything wrong. It just said we knew Benz, showed a picture of him sitting behind Shellenberger as he testified, then said things like “More recently, Mr. Benz originated the false assertion that Taylor Swift was a ‘psychological operation’ asset for the Pentagon,” as if that had something to do with us. It’s Six Degrees of Misinformation. Rutenberg two election cycles ago authored the seminal article on “oppositional” journalism in the Trump age. “Trump is Testing the Norms of Objectivity in Journalism” came out in summer of 2016, and was hugely influential. It said Trump was such a threat that the job going forward could no longer just be about reporting facts, but reporting facts that will “stand up to history’s judgment.” Now he’s arguing the exposure of censorship programs is “paralyzing” official efforts to police social media, the medium that was “central to [Trump’s] political success.” Apparently misleading the public about my reporting is the new version of staying on the right side of “history’s judgment.” Let’s hope the Supreme Court doesn’t get distracted by these hysterics. Is there any doubt that’s what this story is designed to accomplish? * * * Subscribe to Matt Taibbi's Racket News substack here... Tyler Durden Mon, 03/18/2024 - 14:05.....»»
Elon Musk Reveals Two "Very Mentally Ill" People With Guns Tried To Assassinate Him
Elon Musk Reveals Two "Very Mentally Ill" People With Guns Tried To Assassinate Him On Sunday night, Elon Musk revealed in an X Spaces with Dr. Gad Saad, a professor of marketing at the John Molson School of Business at Montreal's Concordia University, that two "very mentally ill" people have tried to kill him in Austin, Texas. Near the end of the one-hour interview, Musk discussed his level of fame and how it's been problematic when he goes out in public. He said people are super nice, but every time he goes to restaurants, there are lines of people who want selfies with him. "I can't easily go to the mall or a movie theater or walk around without creating a ruckus," the world's richest man said. Saad asked Musk: "Do you have security around in your daily life?" Musk responded: "Yes. It's very rare for me to get death threats." However, he said, "I have had two cases in the last six months where two people, unfortunately very mentally ill, came to try to kill me in Austin with guns." "I have had two cases in the last 6 months where two people, unfortunately very mentally ill, came to try to kill me." 一 Elon Musk pic.twitter.com/W9yhKHOJwj — DogeDesigner (@cb_doge) March 18, 2024 In December 2022, Musk posted a video of a "crazy stalker" who followed a vehicle carrying his son X Æ A-Xii. The billionaire then wasted no time suspending X accounts for 'doxxed real-time location info.' Meanwhile, Musk's commitment to 'free speech' X has infuriated Deep State entities, leftist corporate media outlets, and radical Democrats. The Biden administration has been increasingly weaponizing federal agencies after the billionaire's companies. It wouldn't be surprising if the two crazies that came after Musk in Austin were flaming libtards. Tyler Durden Mon, 03/18/2024 - 09:30.....»»
Supreme Court To Hear Arguments In Biden Admin’s Censorship Of Social Media Posts
Supreme Court To Hear Arguments In Biden Admin’s Censorship Of Social Media Posts Authored by Tom Ozimek via The Epoch Times (emphasis ours), The U.S. Supreme Court will soon hear oral arguments in a case that concerns what two lower courts found to be a “coordinated campaign” by top Biden administration officials to suppress disfavored views on key public issues such as COVID-19 vaccine side effects and pandemic lockdowns. President Joe Biden delivers the State of the Union address in the House Chamber of the U.S. Capitol in Washington on March 7, 2024. (Mandel Ngan/AFP/Getty Images) The Supreme Court has scheduled a hearing on March 18 in Murthy v. Missouri, which started when the attorneys general of two states, Missouri and Louisiana, filed suit alleging that social media companies such as Facebook were blocking access to their platforms or suppressing posts on controversial subjects. The initial lawsuit, later modified by an appeals court, accused Biden administration officials of engaging in what amounts to government-led censorship-by-proxy by pressuring social media companies to take down posts or suspend accounts. Some of the topics that were targeted for downgrade and other censorious actions were voter fraud in the 2020 presidential election, the COVID-19 lab leak theory, vaccine side effects, the social harm of pandemic lockdowns, and the Hunter Biden laptop story. The plaintiffs argued that high-level federal government officials were the ones pulling the strings of social media censorship by coercing, threatening, and pressuring social media companies to suppress Americans’ free speech. ‘Unrelenting Pressure’ In a landmark ruling, Judge Terry Doughty of the U.S. District Court for the Western District of Louisiana granted a temporary injunction blocking various Biden administration officials and government agencies such as the Department of Justice and FBI from collaborating with big tech firms to censor posts on social media. Later, the Court of Appeals for the Fifth Circuit agreed with the district court’s ruling, saying it was “correct in its assessment—‘unrelenting pressure’ from certain government officials likely ‘had the intended result of suppressing millions of protected free speech postings by American citizens.’” The judges wrote, “We see no error or abuse of discretion in that finding.” The ruling was appealed to the Supreme Court, and on Oct. 20, 2023, the high court agreed to hear the case while also issuing a stay that indefinitely blocked the lower court order restricting the Biden administration’s efforts to censor disfavored social media posts. Supreme Court Justices Samuel Alito, Neil Gorsuch, and Clarence Thomas would have denied the Biden administration’s application for a stay. “At this time in the history of our country, what the Court has done, I fear, will be seen by some as giving the Government a green light to use heavy-handed tactics to skew the presentation of views on the medium that increasingly dominates the dissemination of news,” Justice Alito wrote in a dissenting opinion. “That is most unfortunate.” Supreme Court Justice Samuel Alito poses in Washington on April 23, 2021. (Erin Schaff/Reuters) The Supreme Court has other social media cases on its docket, including a challenge to Republican-passed laws in Florida and Texas that prohibit large social media companies from removing posts because of the views they express. Oral arguments were heard on Feb. 26 in the Florida and Texas cases, with debate focusing on the validity of laws that deem social media companies “common carriers,” a status that could allow states to impose utility-style regulations on them and forbid them from discriminating against users based on their political viewpoints. The tech companies have argued that the laws violate their First Amendment rights. The Supreme Court is expected to issue a decision in the Florida and Texas cases by June 2024. ‘Far Beyond’ Constitutional Some of the controversy in Murthy v. Missouri centers on whether the district court’s injunction blocking Biden administration officials and federal agencies from colluding with social media companies to censor posts was overly broad. In particular, arguments have been raised that the injunction would prevent innocent or borderline government “jawboning,” such as talking to newspapers about the dangers of sharing information that might aid terrorists. But that argument doesn’t fly, according to Philip Hamburger, CEO of the New Civil Liberties Alliance, which represents most of the individual plaintiffs in Murthy v. Missouri. In a series of recent statements on the subject, Mr. Hamburger explained why he believes that the Biden administration’s censorship was “far beyond anything that could be constitutional” and that concern about “innocent or borderline” cases is unfounded. For one, he said that the censorship that is highlighted in Murthy v. Missouri relates to the suppression of speech that was not criminal or unlawful in any way. Mr. Hamburger also argued that “the government went after lawful speech not in an isolated instance, but repeatedly and systematically as a matter of policy,” which led to the suppression of entire narratives rather than specific instances of expression. “The government set itself up as the nation’s arbiter of truth—as if it were competent to judge what is misinformation and what is true information,” he wrote. “In retrospect, it turns out to have suppressed much that was true and promoted much that was false.” The suppression of reports on the Hunter Biden laptop just before the 2020 presidential election on the premise that it was Russian disinformation, for instance, was later shown to be unfounded. Some polls show that if voters had been aware of the report, they would have voted differently. Tyler Durden Mon, 03/18/2024 - 09:45.....»»
Key Events This Week: Central Banks Galore Including A Historic Rate Hike By The BOJ
Key Events This Week: Central Banks Galore Including A Historic Rate Hike By The BOJ According to DB's Jim Reid, "this could be a landmark week in markets as the last global holdout on negative rates looks set to be removed as the BoJ likely hikes rates from -0.1% tomorrow." That will likely overshadow the FOMC that concludes on Wednesday that will have its own signalling intrigue given recent strong inflation. We also have the RBA meeting tomorrow and the SNB and BoE meetings on Thursday to close out a big week for global central bankers with many EM countries also deciding on policy. We’ll preview the main meetings in more depth below but outside of this we have the global flash PMIs on Thursday as well as inflation reports in Japan (Thursday) and the UK (Wednesday). US housing data also permeates through the week as you'll see in the full global day-by-day week ahead at the end as usual. Let’s go into detail now, starting with the BoJ tomorrow. We’ve had negative base rates now for 8 years which if is the longest run ever seen for any country in the history of mankind. In fact it is doubtful that pre-historic man was as generous as to charge negative interest rates on lending money prior to this! It also might be one of the longest global runs without any interest rate hikes given the 17 year run that could end tomorrow. So, as Reid puts it, a landmark event. DB's Chief Japan economist expects the central bank to revise its policy and abandon both NIRP and the multi-tiered current account structure and set rates on all excess reserves at 0.1%. He also sees both the yield curve control (YCC) and the inflation-overshooting commitment ending, replaced by a benchmark for the pace of the bank’s JGB purchasing activity. The house view forecast of 50bps of hikes through 2025 is more hawkish than the market but risks are still tilted to the upside. On Friday, the Japan Trade Union Confederation (Rengo) announced the first tally of the results of this year's shunto spring wage negotiation. The wage increase rate, including the seniority-based wage hike, is 5.28%, which was significantly higher than expected. This year will probably see the highest wage settlements since 1991 which given Japan’s recent history is an incredible turnaround. This wage data news has firmed up expectations for tomorrow. With regards to the FOMC which concludes on Wednesday, DB economists expect only minor revisions to the meeting statement that saw an overhaul last meeting. With regards to the SEP, the growth and unemployment forecasts are unlikely to change but the 2024 inflation forecasts potentially could; elsewhere, expect the Fed to revise up their 2024 core PCE inflation forecast by a tenth to 2.5%, although they see meaningful risks that it gets revised up even higher to 2.6%. In our economists' view, a 2.5% core PCE reading would allow just enough wiggle room to keep the 2024 fed funds rate at 4.6% (75bps of cuts). However, if core PCE inflation were revised up to 2.6%, it would likely entail the Fed moving their base case back to 50bps of cuts, as this would essentially reflect the same forecasts as the September 2023 SEP. Beyond 2024, DB expect officials to build in less policy easing due to a higher r-star. If two of the eight officials currently at 2.5% move up by 25bps, then the long-run median forecast would edge up to 2.6%. This could be justified by a one-tenth upgrade to the long-run growth forecast. After all this information is released the presser from Powell will of course be heavily scrutinised, especially on how Powell sees recent inflation data. Powell should also provide an update on discussions around QT but it is unlikely they are ready yet to release updated guidance. One additional global highlight this week might be a big fall in UK inflation on Wednesday, suggesting that headline CPI will slow to 3.4% (vs 4% in January) and core to 4.5% (5.1%). Elsewhere there is plenty of ECB speaker appearances including President Lagarde on Wednesday. They are all highlighted in the day-by-day guide at the end. Courtesy of DB, here is a day-by-day calendar of events Monday March 18 Data: US March New York Fed services business activity, NAHB housing market index, China February retail sales, industrial production, property investment, Eurozone January trade balance, Canada February raw materials, industrial product price index, existing home sales Tuesday March 19 Data: US January total net TIC flows, February housing starts, building permits, Japan January capacity utilization, Germany and Eurozone March Zew survey, Eurozone Q4 labour costs, Canada February CPI Central banks: BoJ decision, ECB's Guindos speaks, RBA decision Auctions: US 20-yr Bond ($13bn, reopening) Wednesday March 20 Data: UK February CPI, PPI, RPI, January house price index, China 1-yr and 5-yr loan prime rates, Japan February trade balance, Italy January industrial production, Germany February PPI, Eurozone March consumer confidence, January construction output Central banks: Fed's decision, ECB's Lagarde, Lane, De Cos, Schnabel, Nagel and Holzmann speak, BoC summary of deliberations Earnings: Tencent, Micron Thursday March 21 Data: US, UK, Japan, Germany, France and Eurozone March PMIs, US March Philadelphia Fed business outlook, February leading index, existing home sales, Q4 current account balance, initial jobless claims, UK February public finances, Japan February national CPI, Italy January current account balance, France March manufacturing confidence, February retail sales, ECB January current account, EU27 February new car registrations Central banks: BoE decision, SNB decision Earnings: Nike, FedEx, Lululemon, BMW, Enel Auctions: US 10-yr TIPS ($16bn, reopening) Other: European Union summit, through March 22 Friday March 22 Data: UK March GfK consumer confidence, February retail sales, Germany March Ifo survey, January import price index, Canada January retail sales * * * Finally, looking at just the US, Goldman notes that the key economic data releases this week are the Philadelphia Fed manufacturing index and existing home sales reports on Thursday. The March FOMC meeting is on Wednesday. The post-meeting statement will be released at 2:00 PM ET, followed by Chair Powell’s press conference at 2:30 PM. There are several speaking engagements from Fed officials this week, including Chair Powell, Vice Chair for Supervision Barr, and President Bostic. Monday, March 18 There are no major economic data releases scheduled. Tuesday, March 19 08:30 AM Housing starts, February (GS +9.4%, consensus +7.4%, last -14.8%); Building permits, February (consensus +2.0%, last -0.3%) Wednesday, March 20 02:00 PM FOMC statement, March 19 – March 20 meeting: As discussed in our FOMC preview, we continue to expect the committee to target a first cut in June, but we now expect 3 cuts in 2024 in June, September, and December (vs. 4 previously) given the slightly higher inflation path. We continue to expect 4 cuts in 2025 and now expect 1 final cut in 2026 to an unchanged terminal rate forecast of 3.25-3.5%. The main risk to our expectation is that FOMC participants might be more concerned about the recent inflation data and less convinced that inflation will resume its earlier soft trend. In that case, they might bump up their 2024 core PCE inflation forecast to 2.5% and show a 2-cut median. Thursday, March 21 08:30 AM Current account balance, Q4 (consensus -$209.5bn, last -$200.3bn) 08:30 AM Philadelphia Fed manufacturing index, March (GS 3.2, consensus -1.3, last 5.2): We estimate that the Philadelphia Fed manufacturing index fell 2pt to 3.2 in March. While the measure is elevated relative to other surveys, we expect a boost from the rebound in foreign manufacturing activity and the pickup in US production and freight activity. 08:30 AM Initial jobless claims, week ended March 16 (GS 210k, consensus 215k, last 209k): Continuing jobless claims, week ended March 9 (consensus 1,815k, last 1,811k) 09:45 AM S&P Global US manufacturing PMI, March preliminary (consensus 51.8, last 52.2): S&P Global US services PMI, March preliminary (consensus 52.0, last 52.3) 10:00 AM Existing home sales, February (GS +1.2%, consensus -1.6%, last +3.1%) 02:00 PM Federal Reserve Vice Chair for Supervision Barr speaks: Federal Reserve Vice Chair Michael for Supervision Barr will participate in a fireside chat in Ann Arbor, MI with students and faculty. A moderated Q&A is expected. On February 14, Barr said the Fed is “confident we are on a path to 2% inflation,” but the recent report showing prices rose faster than anticipated in January “is a reminder that the path back to 2% inflation may be a bumpy one.” Barr also noted that “we need to see continued good data before we can begin the process of reducing the federal funds rate.” Friday, March 22 09:00 AM Fed Reserve Chair Powell speaks: The Federal Reserve Board will host a Fed Listens event in Washington D.C. on “Transitioning to the Post-Pandemic Economy.” Chair Powell will deliver opening remarks. Vice Chair Phillip Jefferson and Fed Governor Michelle Bowman will moderate conversations with leaders from various organizations. On March 6, Chair Powell noted in his congressional testimony that if the economy evolves broadly as expected, it will likely be appropriate to begin dialing back policy restraint at some point this year. 12:00 PM Federal Reserve Vice Chair for Supervision Barr speaks: Federal Reserve Vice Chair for Supervision Michael Barr will participate in a virtual event on “International Economic and Monetary Design.” A moderated Q&A is expected. 04:00 PM Atlanta Fed President Bostic (FOMC voter) speaks: Atlanta Fed President Raphael Bostic will participate in a moderated conversation at the 2024 Household Finance Conference in Atlanta. On March 4, Bostic said, “I need to see more progress to feel fully confident that inflation is on a sure path to averaging 2% over time.” Bostic also noted, “I expect the first interest rate cut, which I have penciled in for the third quarter, will be followed by a pause in the following meeting.” Source: DB, Goldman, BofA Tyler Durden Mon, 03/18/2024 - 09:59.....»»
We Should Thank God For The Communists
We Should Thank God For The Communists By Eric Peters, CIO of One River Asset Management Thank God: “Value investors think China is cheap, at some point it’ll turn,” said the CIO, decades spent in HK, investing globally, Asia focused. “Perhaps they’re right,” he said, a light shrug. “But markets require capitalism, and capitalism requires rule of law.” China is one of the most important wildcards to track to understand the global economy, markets, geopolitics. “Confucius believed in rule by law, with the word of a wise, moral, ethical leader being law. Mencius (Confucianism’s 2nd sage) agreed about morals and ethics but argued for rule of law.” “Xi Jinping believes in rule by law; what he says is law,” continued the CIO. “Now that Xi has shown his hand as he tightens his grip on the Party, economy, markets, what could he possibly say going forward that would entice any thinking person to take real risk?” he asked. “For the first time in my career, the Hong Kong tycoons have accepted that it’s over,” he said. “They feel the US has it in for them, and they see China as un-investable now,” he said. “Their grandparents fled the mainland in ’49 and taught them to never trust the Communists. “The Party hired Xi in 2012 to clean up the mess of successive governments,” said the same CIO. “Rampant corruption of Party members, excessive dependency on property and fixed asset investment, environmental degradation, wealth inequality.” Existential threats to the Communist Party. “Xi looked at this rot and took it apart. It was his chance to introduce rule of law. Had he done so, he would have created a China that could have overtaken the US. But just like in 1949 he caused China’s talent to flee. We should thank God for the Communists.” “Xi saw the experiment with openness and wealth accumulation as dangerous to Party control,” he said. “He will subordinate everything to enhance state power in his quest to displace America as the world’s rule setter,” he said. “He’s telling you precisely what he’s going to do. Eat bitterness. And each day the surveillance state grows stronger.” AI will make it more so. “What we see as economic sickness, Xi sees a price worth paying, because at the other side of this challenge is China’s rightful place at the head of the table. That’s his objective.” “Xi believes he can allocate capital to build China top down,” said the CIO. “He thinks he can create Nvidia by decree. But Jensen Huang’s grandparents fled China’s Communists in 1949. Jensen had a vision that accelerated compute would be the future. He suffered multiple failures, made numerous acquisitions over decades, took enormous risks.” 30yr overnight success. “TSMC likewise realized it needed to shrink the geometry to make it happen. ASML knew it needed to go beyond the current understanding of the physics of etching.” “TSMC’s gross cash flows that they can invest back in capital expenditure eclipses the entire market cap of China’s semiconductor industry,” he said. “Taiwan has an ecosystem with engineers and suppliers who have worked together and know how to talk to each other and make things happen.” No way China catches up. Nor does Intel. “And Sam Altman wants trillions to build data centers and buy chips. Google wants the same.” Microsoft too. “They’re signaling that this is where the future value lies.” “We’re entering a world where the value is in hard tech,” said the CIO. “Where doing important things are very difficult and capital intensive.” We have left a world of capital light opportunity - the software era is ending with the arrival of AI. “Google was built with $100mm and 1000 people. It’s the greatest business on earth,” he said. “Compare those two inputs to what Jensen had to build, it’s drastically different. And this will be more the norm for the people who build tremendous value. More dollars spent, more people, more risk, more time.” Anecdote “China’s inward turn will still allow for years of 2-4% growth,” said the CIO from HK. “Each year the Party will forecast better times ahead. They’ll say we’re weaning ourselves off bad habits.” Perpetual propaganda. “What’s interesting is that countries across Asia are now waking up to this problem and becoming more dynamic,” he said. “Having tried everything else for 35yrs of stagnation, Japan appears willing to try capitalism. It has countless tech companies with small global market share.” Consolidation will create real global competitors. “Tokyo realizes that if you want a defense industry you must pay for it. It’s expensive and requires hard tech.” The Europeans are realizing this too. “Seoul has too much dependence on China. And with Kim up north and US global engagement increasingly uncertain, they’re copying Japan and trying to increase corporate valuations.” Dynamic economies fund stronger militaries. “Indonesia has been a non-aligned country and now it wants to join the OECD,” he said. “China joined the WTO at the tail end of the Asian financial crisis,” he said. “Chinese people don’t need to be told how to make money, they sense profit, and go. The WTO was this gigantic green light to stopped cars at the red light. And they said this is it. If I want to make real money, I need to bet the farm. I’m going to build a big factory because now I can sell everything to everyone in America without a tariff.” Those who raced got rich. “In India, historically, entrepreneurs didn’t know what would happen when the government changed, so they built one small factory to ensure they didn’t have overcapacity,” he said. “India never scaled. But now you have a stable government with a consistent set of policies,” he said. “Ambani and Adani, they’re in a league all their own. But the next 50 people down the rankings have a chance and they’re going to go for it. These two guys can’t do everything. And the government needs aggressive risk takers to build the country. If you want to be Vanderbilt or Rockefeller this is your moment.” Tyler Durden Mon, 03/18/2024 - 10:10.....»»
Google Surges On Report Apple In Talks To Use Woke Gemini To Power iPhone AI
Google Surges On Report Apple In Talks To Use Woke Gemini To Power iPhone AI.....»»