Jim Cramer Warns Ford Could Impose Lockout As UAW Strike Enters Day 4: "Playing With Fire"

The leak of a draft opinion is a near unprecedented breach of Supreme Court norms that could undermine its functioning and collegiality. Chief Justice John Roberts ordered an investigation into the leak of a draft opinion.Andrew Harnik/AFP via Getty Images Chief Justice John Roberts has ordered an internal investigation into the leak of a draft opinion. Roberts has long warned Supreme Court clerks and staff not to divulge details of deliberations. Legal experts were struck not just by the implications of the draft opinion but the leak itself. At the beginning of a Supreme Court term, Chief Justice John Roberts is known to sprinkle an admonition into an otherwise warm welcome to the latest class of generally young, frequently Ivy League-educated clerks.Leak information about the high court's inner workings, he warns, and prepare to face career consequences. His message, recounted to Insider by past clerks and others familiar with the Supreme Court, is meant to underscore the need to prevent any leak that could spur insider trading or breach the customary confidentiality around the justices' deliberations.Now, Roberts' nightmare scenario is playing out in perhaps the most consequential Supreme Court case in decades.Late Monday, Politico published a draft 98-page opinion in which a majority of the Supreme Court justices appeared poised to overturn Roe v. Wade, the landmark 1973 decision that has guaranteed the federal right to an abortion for nearly a half-century.According to Politico, Justice Samuel Alito wrote in the draft opinion that "Roe was egregiously wrong from the start" and that it must be "overruled" along with Planned Parenthood v. Casey, a 1992 decision that reaffirmed Roe and established that states cannot impose an "undue burden" on abortion rights.If the decision holds, it would have seismic consequences for the future of abortion rights in the US. But legal experts were also stunned by the leak itself, with one calling it "highly disturbing" and an almost unprecedented breach of Supreme Court protocol.Politico described the source of the draft opinion as a person familiar with the legal challenge to Roe v. Wade, leaving unclear whether it was a clerk, a justice, or anyone affiliated with the Supreme Court. And so the leak immediately gave rise to a game of whodunit among conservatives and the right-wing media, many of whom suggested the source of the draft had violated the law. But experts said it was difficult to identify any criminal violation.On Tuesday, the chief justice joined in on the effort to investigate the source of the leak. Calling it a "betrayal of the confidences of the court," Roberts ordered the marshal of the Supreme Court to launch an investigation into the matter. In doing so, Roberts has essentially ordered an administrative inquiry akin to an internal investigation at a company, legal experts said."The fact that the marshal is doing it suggests they are treating it like an ethical and employment issue," said David Lat, the author of the Original Jurisdiction newsletter and a close Supreme Court observer.Roberts' introduction to the Supreme Court came at a point when concerns about leaks were reaching a fever pitch. In 1979, a year before he began clerking for the late Justice William Rehnquist, journalists Bob Woodward and Scott Armstrong published "The Brethren: Inside the Supreme Court," a "behind the scenes" account of Warren Burger's early years as chief justice.The book reportedly infuriated justices by detailing the deliberations that led to some of the Supreme Court's most controversial decisions in the 1970s.At the high court, justices, clerks, and staff view the confidentiality of deliberations as key to preserving open lines of argument and collaboration in reviewing cases. That culture "facilitates a kind of lawyerly work and dialogue that is hugely productive," a former clerk told Insider. But it isn't possible if people are "looking over their shoulders," they added.As chief justice, Roberts is the face of the Supreme Court, and "it is viewed as his job to protect the integrity of the court as an institution," Lat said.  "And this leak strikes a blow right to the heart of that."But Roberts is not alone in cautioning against leaks. The late Justice Antonin Scalia, for instance, also warned new clerks on their first day about leaking."If I ever discover that you have betrayed the confidences of what goes on in these chambers, I will do everything in my power to ruin your career," Scalia would say, according to a former clerk.In 2012, Roberts himself became the subject of a rare report on the Supreme Court's internal deliberations. CBS reported in July of that year that he had initially sided with the court's four conservative justices to strike down then-President Barack Obama's signature health care law, the Affordable Care Act, but later changed his position and voted with the four Democrat-appointed justices.But that leak paled in comparison to the release of an entire draft opinion, former clerks and others familiar with the Supreme Court told Insider."The court can't operate if that happens. This is a major, major leak," a former Supreme Court clerk told Insider. "It's hard to imagine a bigger leak."In his statement Tuesday, Roberts said the Supreme Court's work would "not be affected" by the leak. Roberts called it a "singular and egregious breach of the trust that is an affront to the court and the community of public servants who work here."For some, the mere fact that the Supreme Court issued a statement reflected how seriously it is taking the leak. Oftentimes, Lat said, the court prefers to "just keep plugging ahead and pretend unfortunate things did not happen." "I think this situation right now," he added, "is Chief Justice Roberts' worst nightmare."Read the original article on Business Insider.....»»

"Striketober" - Walk-Outs Surge As Workers See Opportunity In Rising Job Openings Some labor experts have opined that the failure of a group of workers at an Amazon warehouse in Bessemer, Ala. to succeed in their battle to form a union should blunt the nascent revival in the American labor movement. But as the number of American workers who decided to quit their jobs during the prior month soared to a record high north of 4MM, the number of open jobs in the US remains north of 10MM. For the first time in decades, workers have the power in the labor market. And they're using this newfound leverage to launch a flurry of strikes, creating another headache for their preoccupied bosses. According to Reuters, thousands of workers are on strike across the US. Data maintained by Cornell show 176 strikes have been called this year, with 17 in October alone. They're demanding high pay and better conditions, among other things, and some of them are already winning or at least reaching a settlement. Just this weekend, Hollywood make-up artists and camera operators reached a deal  to avoid a walkout. This victory in Hollywood, combined with the latest JOLTS numbers, are bound to be encouraging. Kevin Bradshaw, an employee at Kellogg's cereal plant in Memphis, Tennessee, where most of North America's Frosted Flakes are made, told Reuters he opposes cuts to healthcare coverage, retirement benefits and vacation time that union officials say the company is pushing for from about 1,400 workers. They have been on strike since Oct. 5 at plants in Michigan, Nebraska, Pennsylvania and Tennessee. "Enough is enough," said Bradshaw, vice president of Bakery, Confectionary, Tobacco Workers and Grain Millers International Union Local 252G at the Memphis plant. "We can't afford to keep giving away things to a company that financially has made record-breaking returns." Kellogg's labor activists complain that their members were deemed "essential" during the start of the COVID pandemic, yet, despite this, the manner in which they are treated by management hasn't changed. Another thing workers hope will benefit them in their struggle (although, in the end, disappointment isn't just possible, but likely): the Democrats are back in control in Washington. But workers who expect President Biden to have their backs should remember that the Dems and President Biden are restricted by their corporate backers. Still, so far, at least 176 strikes have been launched this year, including 17 in October alone, according to data from Cornell's Labor Action Tracker. "Workers are on strike for a better deal and a better life," said Liz Shuler, president of the AFL-CIO, the country's biggest labor federation, during a conference for business journalists. "The pandemic really did lay bare the inequities of our system and working people are refusing to return to crappy jobs that put their health at risk," she added, noting that the term #Striketober was trending on Twitter. There have been some setbacks, yet overall, union laaders are still hopeful. Union membership has declined to just 11% of workers today, down from more than 20% in late 1983. What's more, Americans' support for unions has risen to its highest level in decades. 68% of Americans now approve of unions, the highest level since 1965, according to Gallup. "We have entered a new era in labor relations," said Harley Shaiken, professor emeritus of labor at the University of California Berkeley. "Workers feel they're in the driver's seat and there's plenty of lost ground to make up." "What we're seeing is a fight to return or at least stay in the middle class," he said. Back in April, President Biden - who has struggled to appeal to working-class whites by playing up his ties to organized labor - created a task force to promote labor organizing. Biden also spoke out in support of the workers in Bessemer before  their vote, which organizers insist was unfairly tampered with by Amazon. Other setbacks for the bosses have popped up in Beaumont, Texas, where Exxon Mobil ordered a lockout of 650 workers from its refinery and an adjacent plant since May after a local chapter of the United Steelworkers union refused to submit a contract proposal. Union leaders have scheduled a vote on the contract for Tuesday, but have urged members to reject it. Some members are moving to try and decertify the union. Exxon said the lockout was necessary to avoid the disruption of a possible strike and the changes to seniority it wants to impose were needed to ensure profitability. Some union members have moved to decertify the union. Over at John Deere, which makes farm equipment, 90% of its 10K workers recently launched a strike. And according to Reuters, one industry that's ripe for labor unrest is health-care. More than 28,000 healthcare workers at 13 Southern California Kaiser Permanente hospitals and hundreds of medical centers voted overwhelmingly earlier this month to authorize a strike. They want more pay and higher levels of staffing to reduce burnout worsened by the pandemic. That demand is echoed by nearly 2,000 healthcare workers who have been on strike since Oct. 1 in Buffalo, New York. "We've been working short at Mercy for five years," Kathy Kelly, who has been a nurse for 38 years at the Catholic Health System's Mercy Hospital, said while on break from picketing. "Enough's enough. We can only give so much." Anybody searching for more data on labor actions can check the ILR data from Cornell, which can be found here. Tyler Durden Mon, 10/18/2021 - 19:30.....»»

Futures, Global Stocks Tumble As Markets Reel After Fed's Hawkish Pause Futures are sharply lower, extending yesterday's steep losses after the Fed’s hawkish pause. The Fed wasn't alone in keeping rates unchanged: it was followed by both the SNB and BOE, both of which surprised markets by not raising rates and sending the franc and sterling sliding. On the other hand, the inflation-ridden Riksbank and Norges both hiked, telling investors to expect more such moves. Hyperinflating basket case Turkey hiked by 500bps, in line with expectations. As of 7:45am, S&P futures tumbled 0.7% to 4,415, while Nasdaq 100 futures were down 1% briefly dipping below the key 15,000 level. Most Treasury yields climbed apart from two-year rates, which edged lower. The Bloomberg Dollar Spot Index traded near the day’s highs, pressuring most other Group-of-10 currencies. Brent crude fell for a third-straight day, trading below $93. Gold slid and Bitcoin declined 1%. Today’s macro data focus is on Jobless Claims, Existing Home Sales, Leading Index, and Philly Fed. In premarket trading, Splunk was set to open sharply higher after Cisco announced it would purchase the company for $157/share (it closed just below $120). Broadcom slumped after a report by The Information that Google has discussed dropping the company as an AI chips supplier as early as 2027. FedEx shares rise as much as 5.4% after the courier raised the lower end of its fiscal 2024 adjusted EPS forecast, thanks to cost cutting, strong pricing and customers who switched to the courier from its main rival on concern over a potential strike, and prompting analysts to hike their price targets on the stock. Analysts were positive on the company’s cost reduction progress and highlighted the strong performance at its Ground unit and said that guidance is still conservative. Here are the other notable premarket movers: ARM Holdings shares fall 2.3%, with the chip designer nearing its $51 IPO price, as rising bond yields put pressure on growth stocks, with tech peers down too. Broadcom shares drop as much as 4.6%, following a report from The Information that Google executives “extensively” discussed dropping the semiconductor maker as an AI chips supplier as early as 2027, citing a person familiar with the matter. CrowdStrike shares rise as much as 3.4%, as analysts hike their price targets on the stock following the Fal.Con cybersecurity conference and investor briefing, at which it set out new targets. Analysts said the company’s margin outlook was especially strong, and new products such should help boost growth. Film and entertainment stocks rise, after Hollywood Studios and writers came a step closer to reaching a deal to end months of strikes. Warner Bros (WBD US) +3.1% and Paramount (PARA US) +3%. The Fed on Wednesday held its target range, while updated quarterly projections showed most officials favored another rate hike in 2023. Policymakers also see less easing next year, with the median forecast for the federal funds rate at 5.1% by year-end, up from 4.6% when projections were last updated in June. “People did expect a hawkish hold from the Fed, but it’s the extent of the hawkishness that surprised,” said Lee Hardman, a strategist at MUFG Bank Ltd. “We thought they may take one cut out of next year’s forecasts — instead they took two out. So it was much more hawkish than markets were pricing in.” Some non-Fed headlines came from BAC’s CFO who says, “It’s difficult to see a US recession when the consumer is spending 4% more year-over year.”  Axios reported that the US Chamber of Commerce’s Small Business Index, a confidence indicator, has reached its highest level since COVID struck US markets in early 2020. The survey includes 751 business, each that have fewer than 500 people; 71% say they expect revenue to increase next year. Spoiler alert: it won't. Europe's Stoxx 600 Index declined 1% but was off session lows, with all sectors in the red, as traders digested the Fed’s higher-for-longer message. Travel and leisure stocks fell the most, while miners and industrial stocks also underperformed. Swiss equities were higher after the SNB unexpectedly paused rate hikes, while the BOE is due to announce its rate decision later Shares in UK banks and home builders rose as traders slashed their bets on further rate hikes with UBS saying the BOE hiking cycle is now over. The central bank held its key rate at 5.25%, ending a series of 14 successive hikes since December 2021, after a surprise drop in August inflation this week. “Inflation has fallen a lot in recent months and we think it will continue to do so,” BOE Governor Andrew Bailey said in a written statement. “That’s welcome news. But there is no room for complacency. We need to be sure inflation returns to normal and we will continue to take the decisions necessary to do just that.” A day after the Federal Reserve’s meeting, Europe had its own frenetic flurry of central bank decisions. Before the BOE, Swiss National Bank surprised investors by holding interest rates, causing the franc’s steepest drop since May against the euro. Sweden’s Riksbank increased its key rate as expected and said more hikes were possible, while Norway’s central bank said more tightening may come in December after raising rates to the highest in more than 14 years. Here are Europe's top movers: Merck shares gain as much as 2.2% after Citi raised its recommendation on the German biotech group to buy, predicting performance in the firm’s Life Science and Semiconductor segments will recover in the near future. JD Sports shares rise as much as 8.6% after reporting results that Peel Hunt analysts said reflected a “surprisingly strong” performance in the US following recent guidance cuts from peers Foot Locker and Dick’s Sporting Goods. Next shares gain as much as 2.5% after the UK retailer boosted its pretax profit outlook for the full year, following other guidance raises in August and June. The third guidance update in three months is impressive, with the sales outlook suggesting resilience in the first half, Jefferies said. Safilo shares rise as much as 8.1%, the most intraday since August 2022, after the Italian eyewear company said it’s launching its Carrera Smart Glasses with Amazon.com’s Alexa technology, according to a statement late on Wednesday. Valneva shares rise as much as 4.7% after the French pharmaceutical firm reported better-than-expected first-half earnings. Van Lanschot Kempen sees a “strong set” of figures with beats across the board. CVS Group shares gain as much as 4.4% after the veterinary services firm reports better-than-expected profit. The stock plummeted earlier this month as UK antitrust regulators announced a probe of the sector. Delivery Hero rises as much as 2%, adding to Wednesday’s 7.1% gain, as the food delivery company confirmed that it’s mulling a sale of some businesses in Southeast Asia. Analysts said a potential deal could boost the company’s balance sheet and profit by shaking off some unprofitable operations that are currently involved in intensive competition. Ocado shares drop as much as 9.3% after being downgraded to underperform from neutral at BNP Paribas Exane, which cited the British online grocer’s share price rally in recent months. SSP Group shares fall as much as 8.7% after the food services company gave a trading update saying it expects full-year EPS toward the lower end of its guidance range. Analysts at Goodbody and Shore Capital noted the FX headwinds apparent in the update, but were encouraged by the opportunity from new business. Engcon shares drop as much as 8.9% after an editorial column on Swedish retail-trading website Placera.se recommended its users sell the Swedish industrial firm’s shares, citing a high valuation and slowing growth prospects. Quadient shares fall as much as 8.7% after the French postal- and document-services company reported first-half results that Oddo said were slightly below estimates. Earlier in the session, Asian stocks fell the most in nearly a month after the Fed signaled that interest rates will remain higher for longer amid renewed economic strength, while Chinese equities slumped on persistent pessimism. The MSCI Asia Pacific Index dropped as much as 1.4%, set for a fourth day of losses, led by health-care and technology shares. Most markets in the region were down, with South Korea’s Kospi Index slumping more than 1% as large-cap chip and battery stocks dragged. The Fed left its benchmark interest rate unchanged as expected, while indicating that borrowing costs will likely stay higher for longer after one more hike this year. The message triggered overnight losses in Wall Street, gains in Treasury yields and strength in the dollar. Hang Seng and Shanghai Comp declined alongside the downbeat mood across regional peers, although the losses in the mainland were initially cushioned following the Chinese Cabinet’s pledge to speed up the development of the advanced manufacturing sector and amid resilience in developers after Guangzhou adjust purchase rules for several districts. Japan's Nikkei 225 retreated below the 33,000 level as Japanese yields climbed to decade highs and with the BoJ kickstarting its 2-day policy meeting. Australia's ASX 200 was lower with the top-weighted financial industry leading the broad declines. India’s benchmark stocks gauge dropped for a third consecutive session to its two-week low as US Federal Reserve’s signal to keep interest rates higher for longer spooked equities in Asia. The S&P BSE Sensex fell 0.9% to 66,230.24 in Mumbai, its lowest close since Sept. 6. The NSE Nifty 50 Index declined 0.8% to 19,742.35. ICICI Bank contributed the most to the Sensex’s decline, decreasing 2.8%. Out of 30 shares in the Sensex index, 6 rose and 20 fell, while 4 were unchanged. In FX, the dollar gained against most major currencies, aside from the yen, which traded around 148 per dollar after weakening on Wednesday to the lowest level since November. EUR/CHF rises as much as 0.8% to 0.9656, the biggest daily jump since June EUR/SEK drops as much as 0.9% to 11.7687; it rose earlier to 11.9381 after the Riskbank announced a quarter-point interest rate increase EUR/NOK drops as much as 0.4% to 11.4573 before halving losses; Wednesday’s low is 11.4560 GBP/USD falls as much as 0.4% to 1.2265, after the BOE unexpectedly ended its hiking cycle With most central banks out of the way, attention now turns to Friday's BOJ announcement. There are heightened prospects of official support for the Japanese currency, said John Vail, chief global strategist for Nikko Asset Management Co. in Tokyo. “Japan’s Ministry of Finance is likely to intervene in large fashion at 150 per dollar because it is hard to tolerate more inflationary pressure.” The value of the yen has slumped to the lowest on record, as measured against a broad basket of its peers and adjusted for inflation, according to data from the Bank for International Settlements. This underscores the pressure to address yen weakness at the Bank of Japan, which is where this week’s series of central bank policy meetings wraps up on Friday. In rates, treasury yields were broadly higher after the rate on the two-year note, which is more sensitive to imminent Fed moves, hit the highest since 2006 on Wednesday. After resuming post-Fed selloff in early Asia session, front-end of the Treasuries curve trades richer on the day into early US, outperforming belly and long-end as steepening move extends.  US yields richer by 2bp across front-end of the curve while belly out to long-end trades cheaper by 1.5bp to 4bp on the day; 10-year yields around 4.45% the highest level since 2007, underperforming bunds and gilts by 1.5bp and 5bp in the sector. Gilts were supported after Bank of England keeps rates unchanged. Long-end Treasury yields also reach new cycle highs, joining rest of the curve after Wednesday’s Fed decision. Dollar IG issuance slate includes IBK 5Y; issuance paused Wednesday for the Fed decision and is expected to remain quiet for Thursday. US economic data slate includes 2Q current account balance, September Philadelphia Fed business outlook and weekly initial jobless claims (8:30am), August existing home sales and leading index (10am); no Fed speakers scheduled. In commodities, oil’s breakneck rally is taking a breather as a smaller-than-expected drop in US crude stockpiles bolstered technical resistance to further gains; crude futures declined with WTI falling 1% to trade near $88.80. Spot gold drops 0.4%. To the day ahead, and we’ll get the Bank of England’s latest policy decision, and also hear remarks from the ECB’s Schnabel and Lane. Otherwise, data releases include the US weekly initial jobless claims, existing home sales for August, the Conference Board’s leading index for August, and the Philadelphia Fed’s business outlook for September. In the Euro Area, we’ll get the preliminary consumer confidence reading for September, whilst in the UK there’s the public finances for August. Market Snapshot S&P 500 futures down 0.4% to 4,430.50 Brent Futures down 1.3% to $92.35/bbl Gold spot down 0.2% to $1,926.07 U.S. Dollar Index up 0.13% to 105.46 STOXX Europe 600 down 0.7% to 457.60 MXAP down 1.5% to 159.24 MXAPJ down 1.6% to 492.56 Nikkei down 1.4% to 32,571.03 Topix down 0.9% to 2,383.41 Hang Seng Index down 1.3% to 17,655.41 Shanghai Composite down 0.8% to 3,084.70 Sensex down 0.9% to 66,197.17 Australia S&P/ASX 200 down 1.4% to 7,065.23 Kospi down 1.7% to 2,514.97 German 10Y yield little changed at 2.73% Euro little changed at $1.0657 Brent Futures down 1.3% to $92.35/bbl Top Overnight News Japan may be nearing a point where it can declare victory in its battle against deflation, paving the way for further BOJ policy normalization. Nikkei   As China's stock market struggles to recover, regulators have started to probe some hedge funds and brokerages on quantitative trading strategies amid a growing outcry against a sector able to profit from share price falls and volatility. RTRS Natural gas prices sink in Europe as Chevron seems close to resolving a strike in Australia while flows recover in Norway. BBG Norway’s central bank hikes rates by 25bp to 4.25%, as expected, and provides hawkish forward guidance by signaling another increase in Dec (most assumed today’s hike would be the last one). Switzerland’s SNB surprises markets by leaving rates unchanged (economists were anticipating a 25bp hike). BBG Poland looks to downplay remarks from its PM about no longer supplying weapons to Ukraine, insisting that the country remains a committed to helping Kyiv achieve victory. FT Google has talked “extensively” about dropping Broadcom as its AI chip supplier as soon as 2027 as the internet giant looks to cut costs and utilize proprietary silicon (in addition, Google is working to replace Broadcom with Marvell for network interface chips). The Information House Republicans reported major progress charting a path forward on a partisan bill to avert a government shutdown and a Department of Defense spending bill — two measures that suffered public setbacks just a day before — after Speaker Kevin McCarthy (R-Calif.) hashed out a new framework for a GOP-only stopgap proposal in a House Republican conference meeting that lasted more than two hours on Wednesday. The Hill AMZN is abandoning plans to impose a new fee on merchants that don’t use its shipping services amid increased regulatory/antitrust scrutiny on the company from the gov’t. BBG FDX reported very strong FQ1 earnings, with EPS of 4.55 (vs. the Street 3.73), thanks to aggressive cost cutting, and the full-year EPS outlook was increased (although by less than the Q1 beat). RTRS A more detailed look at global markets courtesy of Newquawk Asia-Pac stocks were pressured in the aftermath of the FOMC’s hawkish pause. ASX 200 was lower with the top-weighted financial industry leading the broad declines. Nikkei 225 retreated below the 33,000 level as Japanese yields climbed to decade highs and with the BoJ kickstarting its 2-day policy meeting. Hang Seng and Shanghai Comp declined alongside the downbeat mood across regional peers, although the losses in the mainland were initially cushioned following the Chinese Cabinet’s pledge to speed up the development of the advanced manufacturing sector and amid resilience in developers after Guangzhou adjust purchase rules for several districts. Top Asian News Japanese PM Kishida said he will instruct people to pull together the pillars of an economic package early next week, while they will include measures to counter inflation and social measures to counter declining population, according to Reuters. Chinese Commerce Ministry says some firms have obtained export licenses for gallium and germanium; willing to seek a basket of solutions for the Australian wine dispute. China's 2023 nat gas demand seen at 396.4BCM, +8% Y, via CNOOC; LNG imports 70.79mln/T, +10.9% YY. Nat gas demand from China seen peaking in 2040 at 700BCM. European bourses are pressured as the region reacts to Wednesday's FOMC where a hawkish hold was delivered, Euro Stoxx 50 -1.1%. Action which continues the tone of APAC trade but with the region conscious of a Chinese cabinet pledge around manufacturing and also beginning to look ahead to Friday's BoJ. Sectors are primarily in the red with the exception of Retail post-earnings from JD Sports and Next which reside towards  the top of the Stoxx 600; Travel/Leisure and Basic Resources lag, latter on benchmark activity and numerous price target cuts. US futures are lower across the board but with action slightly more contained when compared to European peers, ES -0.4%, NQ -0.6%; today's docket has a handful of data points before Friday's Fed speak resumption with Cook, Daly & Kashkari. Google (GOOG) reportedly wants to ditch Broadcom (AVGO) as its TPU sever chip supplier to reduce AI costs, according to The Information; Since last year has been working to replace Broadcom with Marvell Technology (MRVL). Pre-market: GOOG -0.7%, AVGO -5.2%, MRVL +3.5% Top European News Sunak Gambles on Voters Focusing More on Costs Than Climate Next Raises Guidance Again as Wage Gains Boost Shoppers SNB Surprises With Rate Pause as Tightening Tames Inflation Riksbank Hikes Swedish Rate With Door Kept Open to Act Again Norway Raises Rate Again and Signals Another Move in December Swiss Stocks Outshine Peers as SNB Pauses; Fed Weighs on Region FX The Fed revives Greenback fortunes via more hawkish dot plots, DXY firmly back above 105.000 within a 105.400-680 range. Franc collapses as SNB defies expectations for a 25bp hike and bases new forecasts on steady 1.75% rate, EUR/CHF and USD/CHF spike circa 100 pips to 0.9677 and 0.9078 respectively. Pound flounders in the dark about BoE prospects for midday as markets remain split between pause and 1/4 point rate rise, Cable sub-1.2300 from just over 1.2350 at best. Yen and Euro pare declines vs. Dollar ahead of 148.50 and 1.0600, with EUR/USD propped up by a Fib and option expiries. Norwegian Crown underpinned around 11.5000 vs. Euro after hawkish Norges Bank hike, Swedish Krona choppy on either side of 11.9000 as Riksbank reaches a peak and hedges 25% FX reserves. PBoC set USD/CNY mid-point at 7.1730 vs exp. 7.3052 (prev. 7.1732) The European Commission has sent a letter to Poland listing 11 questions to determine the scope of the visa-for-bribes scandal and the EU security impact, via Politico; the letter warns that Poland could be violating EU law Fixed Income Bonds off worst levels, but still heavy in wake of hawkish FOMC and through slew of other Central Bank pronouncements. Bunds below par between 129.69-23 parameters, Gilts sub-96.00 within 96.41-95.81 range and T-note nearer base of 108-16/25+ bounds pre-BoE, IJC, Philly Fed and ECB speakers Commodities Crude benchmarks are softer intraday given broader risk sentiment post-Fed, WTI below USD 89.00/bbl and Brent down to a test of USD 92.00/bbl respectively at worst; currently off these lows. Dutch TTF pressured as Offshore Alliance members at Woodside have overwhelmingly voted to endorse a deal with the company. Spot gold is under modest pressure as the USD remains bid with base metals similarly pressured on the broader risk tone. Saudi Crown Prince MBS responded that output reductions are purely based on supply and demand to the market when asked about criticism that oil output cuts help Russia. Australian industrial arbitrator said Chevron (CVX) and unions are on the precipice of achieving the first enterprise agreements for LNG facilities and discussions have resulted in widespread agreement on the majority of provisions of proposals. The arbitrator made recommendations on pay and working conditions for Chevron and unions to consider but noted that a failure to settle all outstanding issues would result in the agreed provisions simply evaporating, while parties are required to advise the commission of their acceptance or rejection of recommendations by 09:00 Sydney time on Friday. Offshore Alliance members at Woodside (WDS AT) have overwhelmingly voted to endorse a deal with the company while members at Chevron (CVX) will meet tonight to consider a recommendation made by the Fair Work Commission, according to a statement. Natural Gas Pipeline Co. declared a force majeure on the M&M line near compressor station 158 located in Dewey County, Oklahoma. Russia is mulling an additional tax on exports for some commodities including metals, according to sources cited by Reuters. Geopolitics Russian Foreign Ministry said NATO drills near Russian borders are increasingly provocative and aggressive in nature, as well increase risks of incidents, according to RIA. Saudi Arabia said solving the Palestinian issue is critical to a deal with Israel, according to FT. In relevant news, Saudi Crown Prince MBS said he is prepared to work with whoever is leading Israel if there is a breakthrough in negotiations for normalisation with Israel, while he had also commented that Saudis will get a nuclear weapon if Iran does first, according to AFP and Fox News. Iranian President Raisi said Iran has no problem with IAEA inspections of its nuclear sites. Qatar held separate bilateral meetings with the US and Iran this week, touching on nuclear and drone issues, according to sources cited by Reuters. Kuwait's PM said the Iraqi ruling on regulating navigation in Khor Abdullah Waterway includes historical fallacies and Iraq needs to take concrete, decisive and urgent measures to address the ruling, according to Reuters. Nagorno-Karabakh ethnic Armenians say Azerbaijani forces have violated the ceasefire; Azerbaijan denies its forces violated the ceasefire. US Event Calendar 08:30: Sept. Initial Jobless Claims, est. 225,000, prior 220,000 08:30: Sept. Continuing Claims, est. 1.69m, prior 1.69m 08:30: Sept. Philadelphia Fed Business Outl, est. -1.0, prior 12.0 08:30: 2Q Current Account Balance, est. -$220b, prior -$219.3b 10:00: Aug. Existing Home Sales MoM, est. 0.7%, prior -2.2% 10:00: Aug. Leading Index, est. -0.5%, prior -0.4% DB's Jim Reid concludes the overnight wrap As widely expected, the FOMC kept the fed funds rate on hold yesterday, but this pause was accompanied by clear hawkish undertones and both bonds and equities sold off notably in the aftermath. 10yr US yields are at 4.43% as I type this morning, +12bps above where they were prior to the meeting. The starting point for the hawkishness came from the updated dot plot in the new Summary of Economic Projections. The end-2023 median dot was unchanged at 5.6%, but the median dot for 2024 moved 50bps higher to 5.1% (our US economists had expected 2024 to move up by 25bps). So the median FOMC member is pencilling in only two rate cuts in 2024, after one more hike this year. Interestingly, the newly published projections for 2026 showed the median dot at 2.9%, still above the long-term projection of 2.5%, so pointing to a persistently "tight" policy stance. The higher 2024-25 dot plot came as the SEP moved further towards a soft landing view, lowering unemployment projections for both 2024 and 2025 by 0.4pp to 4.1%. That would be only a slight uptick from the latest 3.8% level. In the press conference Powell actually said that he “would not” have a soft landing as a baseline expectation, though later adding that soft landing is a primary objective for the FOMC. A little bit of a confusing message but overall, Powell reinforced a higher-for-longer message. Echoing the dot plot, he noted that the neutral rate may have risen and it was “certainly possible that the neutral rate...at this moment is higher than (the long-run rate)”. He also downplayed the prospects of cuts, saying that the FOMC was “never intending to send a signal” about timing of rate cuts with its dot plot and that “there’s so much uncertainty around” this. Powell’s comments did see some moderation of the near-term tightening bias. He noted several times that the Fed is now in a position to “proceed carefully”. The prepared remarks struck a softer tone on labour market tightness and Powell highlighted that the last three inflation prints were “very good” readings, though not yet enough for the Fed to be confident they have reached a “sufficiently restrictive” stance. Our US economists note that with the FOMC end-2023 projections being likely too high on inflation and too low on unemployment, these set a relatively low bar for skipping the final projected hike. Correspondingly, our economists continue to expect no further rate increases – see the reaction note here for their full take. So overall, the Fed sent a clear message that they think rates will stay high for longer, and the markets took this on board. Fed fund futures saw the chances of another hike by the end of the year move up to 54% from 45% the day before, with the peak rate now priced for January 2024 (with a 58% chance of a hike by then). Fed funds pricing for end-24 rose by +13.3bps on the day, and 20bps from its earlier intra-day lows, to a new cycle high of 4.76% (this is still more than 30bps below the Fed’s new median dot). My CoTD yesterday looked the implications of this pricing. Although it reflects the market pricing in a soft landing, the high levels probably increase the risk of a hard one. See the short note here. In the bond market, the 2yr Treasury yield had been trading a few bps lower prior to the Fed decision but spiked by nearly 10bps in its immediate aftermath and closed +8.5bps up on the day at 5.18%, the highest level since 2006. The 10yr yield was up by +4.9bps to 4.41%, a new post-2007 high and is above 4.43% as I type. Meanwhile, the 10yr real yield closed above 2% for the first time since early 2009 (+6.6bps to 2.05%). Equities also lost ground in response to the Fed’s hawkish signal. The S&P 500 was down -0.94% by the close, with the decline coming during and after Powell’s press conference. Tech stocks lagged, with the NASDAQ down -1.53% and the Magnificent Seven mega caps down -2.20%. In FX, the dollar index gained about half a percent following the Fed event, closing up +0.19% on the day after trading lower earlier on. This morning in Asia, the trend continues with the dollar index rising another +0.2% and to fresh 14-year highs. The Yen has drifted to the lowest level since last November since the FOMC with this being an interesting set up ahead of the BoJ tomorrow morning. Equity markets across Asia are also tumbling this morning with the KOSPI (-1.44%) leading losses followed by the Hang Seng (-1.21%), the Nikkei (-1.14%), the Shanghai Composite (-0.58%) and the CSI (-0.52%). S&P 500 (-0.25%) and NASDAQ 100 (-0.35%) futures are also moving lower again as the FOMC message continues to reverberate. With the Fed out of the way, attention will now turn to the Bank of England, who are announcing their latest policy decision at 12:00 London time. Up until yesterday morning, it had been widely expected that the BoE would deliver another 25bp hike. But we then got a strong downside surprise from the August CPI print, where headline inflation unexpectedly fell to +6.7% (vs. +7.0% expected). So markets are now only pricing in a 46% chance of a rate hike today, and it’s very finely balanced as we approach the decision. Our own UK economist at DB has also changed his call following the CPI data (link here), and now thinks that the BoE will skip a rate hike at this meeting. He thinks that the CPI print offers the MPC more optionality to pause, and there were also positive signs beyond the headline number. For instance, core CPI fell to +6.2% (vs. +6.8% expected), whilst the closely-watched services CPI rate fell to +6.8% as well. However, he still sees this decision as finely balanced, with the big miss in inflation and weaker growth momentum now in stark contrast to elevated wage growth. The growing chance of a pause has been evident among gilts as well, with 10yr yields experiencing a sharp decline of -13.0bps yesterday. In addition, the 2yr yield (-16.2bps) closed at a 3-month low of 4.82%. Elsewhere in Europe, markets put in a strong performance ahead of the Fed’s decision, with the STOXX 600 (+0.91%) recovering from its rough start to the week. That was echoed across the major indices, with the DAX (+0.75%), the CAC 40 (+0.67%) and the FTSE 100 (+0.93%) posting solid gains of their own. It was the same story on the bond side too, as yields on 10yr bunds (-3.6bps), OATs (-4.4bps) and BTPs (-6.6bps) moved off their highs from the previous day. All before the FOMC of course. Looking at yesterday’s other data, German PPI continued to plunge, with the latest reading for August at -12.6% (vs. -12.5% expected). That’s the fastest decline in recorded data back to 1948, although that is down from a record peak one year earlier of almost +46%. To the day ahead, and we’ll get the Bank of England’s latest policy decision, and also hear remarks from the ECB’s Schnabel and Lane. Otherwise, data releases include the US weekly initial jobless claims, existing home sales for August, the Conference Board’s leading index for August, and the Philadelphia Fed’s business outlook for September. In the Euro Area, we’ll get the preliminary consumer confidence reading for September, whilst in the UK there’s the public finances for August. Tyler Durden Thu, 09/21/2023 - 08:13.....»»

Cruise missiles hit a shipyard in Sevastopol, damaging two Russian military vessels in Ukraine's latest attack on occupied Crimea. BlackSky imagery captured the damage caused by a Ukrainian cruise missile attack on the Sevastopol Shipyard dry docks in Russia occupied Crimea on September 13, 2023.Courtesy of BlackSky Ukraine on Wednesday launched a huge missile strike on a Russian naval facility in occupied Crimea. The cruise missile attack on the shipyard in Sevastopol left two of Moscow's vessels damaged. A former US Army general said the strikes are a key to making Crimea indefensible for Russia. Ukrainian forces carried out a massive missile attack on a strategic Russian naval shipyard in the occupied Crimean peninsula early Wednesday morning, damaging two vessels in what an official in Kyiv called a "professional and meaningful" statement. The strikes on the Black Sea port city of Sevastopol, which were the results of long-range cruise missiles, marked the latest Ukrainian attacks on Russian positions and assets in and around Crimea, which Kyiv has vowed to liberate from nearly a decade of Russian occupation. These operations are part of a lengthy pressure campaign designed to isolate Crimea and make it "untenable" for Russian forces to stay there, a retired US Army general said. "This is all orchestrated as part of a sophisticated, multi-domain counteroffensive," Ben Hodges, a retired lieutenant general and former commander of US Army Europe, told Insider.Smoke rises from the shipyard that was reportedly hit by Ukrainian missile attack in Sevastopol, Crimea, in this still image from video taken September 13, 2023.REUTERS TV via REUTERSUkrainian aircraft fired ten cruise missiles at the Russian shipyard in Sevastopol, located on the southwestern edge of Crimea, in the pre-dawn attack on Wednesday, according to a statement from Russia's defense ministry that was published to Telegram. It said air-defense systems managed to shoot down seven of the missiles, but the ones that got through inflicted damage on two ships — reportedly a landing vessel and a submarine — that were under repair.BlackSky imagery captured work being done at the Sevastopol Shipyard dry docks in Russian-occupied Crimea on September 12, 2023.Courtesy of BlackSkyBlackSky imagery captured the damage caused by a Ukrainian cruise missile attack on the Sevastopol Shipyard dry docks in Russia occupied Crimea on September 13, 2023.Courtesy of BlackSkySevastopol is the headquarters of Russia's Black Sea Fleet, and the shipyard there is crucial in helping Moscow build and maintain its vessels. After the massive attack — which some observers speculated was the result of UK-provided Storm Shadow or French-provided SCALP-EG long-range cruise missiles — Ukraine's air force thanked its pilots for what it called "excellent combat work" and alluded to more strikes in the future. "The demilitarization of the #Russian Black Sea fleet is a real long-term guarantee of security for regional trade routes and the 'grain corridor,'" Mykhailo Podolyak, an advisor to Ukrainian President Volodymyr Zelenskyy, posted to social media on Wednesday.His remarks were an apparent reference to increasing tensions around the Black Sea and Russia's threats to civilian merchant vessels after Moscow withdrew from the crucial Black Sea grain deal. Podolyak said attacks on the Black Sea fleet are a critical way to respond to Russian aggression in the region. "The way to do this is to build up the capacity of the Armed Forces of #Ukraine, including by expanding the range of weapons," he added. "We can already see the results of this in #Sevastopol. A professional and meaningful 'statement.'"A landing ship and a Russian submarine on fire in Sevastopol’s shipyard seen in a photo shared on September 13, 2023, by investigative outlet Rucrimal Info on their Telegram account.Telegram/@ЧК-ОГПУWednesday's missile strikes on Sevastopol are the latest in a string of high-profile Ukrainian attacks putting pressure on Russia in and around the Crimean peninsula.Last month, Ukraine's military intelligence agency said it destroyed one of Russia's prized S-400 air-defense systems on the westernmost point of the peninsula, and the following day, it said that its forces carried out a daring amphibious raid in the same area, which is where Russia has stationed some sophisticated radar systems. Weeks before that, exploding drone boats attacked a key Russian bridge to Crimea on the eastern side.And earlier this week, Kyiv announced that its special forces recently retook control of the Boika Towers, oil drilling platforms located off the Crimean coast that were seized by Russia in 2015 after it illegally annexed the peninsula the year before. The Ukrainian defense ministry said the platforms had been used for "military purposes" ever since they were captured. n this handout photo released by the Governor of Sevastopol Mikhail Razvozhaev telegram channel on Wednesday, Sept. 13, 2023, Razvozhaev speaks on the mobile phone as smoke and flame rise from a burning Sevastopol Shipyard in Crimea.Sevastopol Governor Mikhail Razvozhaev telegram channel via APThese recent operations around Crimea, including the latest Sevastopol strikes, are not random, Hodges, the retired US Army general, told Insider, but rather part of Ukraine's larger counteroffensive effort.The three-month-long offensive has consisted of attempts by Kyiv to advance past Russia's formidable defensive lines and fortifications, built along the sprawling front line that stretches across Russian-occupied territory in eastern and southern Ukraine. These defensive lines include minefields, anti-vehicle ditches, dragon's teeth obstacles to prevent heavy armor from advancing, and trenches. While this fighting has been a defining aspect of the counteroffensive, the bigger picture here is a multi-faceted campaign playing out across several different domains — including in Crimea. "The counteroffensive is not just Ukrainian ground forces trying to break through Russian trenches and minefields. That's only a part of it," Hodges said. "The counteroffensive is intended to first isolate ... Crimea and then make it untenable for Russian forces."Ukraine has been leveraging its long-range precision strike capabilities — which consists of a limited arsenal of Storm Shadow/SCALP-EG missiles — and innovative drone usage to launch attacks against targets deep in Russian-held territory. Unmanned attacks on Moscow have greatly increased in frequency, and Kyiv has also managed to carry out several high-profile hits on airbases within Russia's internationally recognized territory, damaging and destroying various Russian aircraft, including airlifters and bombers."What we're seeing is pressure being applied against the very fragile Russian General Staff," Hodges said. View of a damaged Russian ship following a Ukrainian missile attack on Sevastopol, Crimea September 13, 2023 in this social media image.Crimean Wind via Telegram via REUTERSIncreasingly regular Ukrainian attacks on Russian territory, inside occupied land, and around the Black Sea has exposed serious shortcomings in Moscow's force protection and air-defense capabilities, raising questions about its ability to actually safeguard its most vulnerable bases and assets. According to Western intelligence, Russia has sought out several alternative solutions to this problem, like building civilian volunteer patrols or tinkering with its network of air-defense systems. Russia has also been spotted putting tires on its aircraft.Meanwhile, officials in Kyiv have continued to press their Western military backers for more long-range weapons, including the US-made Army Tactical Missile System, or ATACMS. Washington is reportedly considering sending Ukraine these missiles, which would give Kyiv a significant firepower boost and threaten Russia's vulnerable positions far beyond the front lines.And while the long-term impact of the Sevastopol strikes remain to be seen, Hodges noted that it's important for Ukraine to keep up the pressure on Russia's Black Sea fleet, which is responsible for missile strikes on Ukrainian cities and infrastructure that have killed and injured scores of civilians. By doing this — and stripping Moscow of maintenance or refueling facilities — Kyiv will force Russian commanders to rethink keeping their ships in Crimea. Ukraine has also been taking aim at ships operating in the Black Sea, stepping up the pressure further."It's showing how vulnerable the Russians are in Crimea," Hodges said of the Sevastopol strikes. "People should believe that the Ukrainians are going to keep coming after Crimea because it is the decisive terrain of this war, and it's not something that can just be traded away 'for the sake of peace.' They're not going to stop."Read the original article on Business Insider.....»»

In the ever-shifting digital universe, a war rages to shield our technology from adversaries. Amid this tumult, a formidable ally ... Read more In the ever-shifting digital universe, a war rages to shield our technology from adversaries. Amid this tumult, a formidable ally emerges – the ethical hackers. These intrepid souls unveil and remediate cybersecurity frailties, all for the greater good. In this article, we plunge headlong into ethical hacking, peeling back the layers to reveal the practices of penetration testing, responsible disclosure, and proactive security measures. The Ethical Hacking Process In the online world where dangers hide and bad people hunt, the white hat brigade fights for good, always watching and protecting. These heroes of the internet are called ethical hackers, experts who use their skills to find and fix problems in the systems they test. Ethical hackers go where bad hackers go, looking for weak spots in our online security. But their goal is not to destroy; it is to make our security stronger. At the heart of their mission lies "penetration testing" – a simulation of real-world attacks, but without the crippling blow. It is the laboratory of battles yet to be fought, where the ethical hacker becomes the cunning adversary, pushing systems to their limits to see if they'll bend or break. Responsible Disclosure As an ethical hacker, you wield the power to unmask hidden vulnerabilities that threaten our precious data fortresses. But ethical hackers have the ethical imperative that separates the heroes from the villains. Imagine this: you’ve found a problem in software that many people use that could be used by bad people to steal or damage things. You’ve got the information, and you want to tell everyone about it. But there’s more to it than just shouting it out loud on the internet. You have to be careful and respectful. Responsible disclosure is like sending a secret tip to the good guys before the bad guys can ruin the party. But you can’t just drop that vulnerability bomb without a care, that’s why it’s considered a stressful endeavor. But here's the twist: responsible disclosure isn't just about sparing the users. It's also about building bridges with the organizations that may see you as a threat, not a savior. By playing nice and giving them time to fix the mess, you're proving that you're not the enemy – they can trust you. The Role of Proactive Security Measures We've talked about the art of ethical hacking and how it helps us stay one step ahead of the bad guys. It's time to go beyond the surface and dig deeper into fortifying those digital walls. You may have heard of the tools that could help you remove sites from Google search results in case you published something out there that you shouldn’t have. But first and foremost, the measures that help you keep and share your data securely are essential for an ethical hacker. Think of proactive security measures as the trusty guards that patrol the virtual corridors of your systems. These guardians don't wait for trouble to knock on the door – they seek out potential threats and stop them dead in their tracks. Continuous monitoring is your cyber security crystal ball. It's like having a sixth sense that warns you when something's amiss. With this watchful eye, you can spot suspicious activities, unusual patterns, and hacking attempts. It's your early warning system. But why stop there? Let's talk about threat hunting, where you become the hunter, not the hunted. Armed with knowledge, you actively seek out potential adversaries rather than waiting for them to strike. It's like being a detective, following the breadcrumbs left behind by hackers and dismantling their wicked plans. And let's not forget proactive patching – keeping your defenses up-to-date against known vulnerabilities. Patching ensures there are no weak spots for the enemy to exploit. The High Price of Negligence Imagine a thriving company with endless possibilities, all set to achieve great success. But hidden within the complex web of servers and networks, a dangerous vulnerability lies unnoticed and underestimated. Then, like a thief striking under the cover of darkness, cyber attackers exploit this weakness, wreaking havoc on the unsuspecting organization. The consequences are devastating – financial losses mount into the millions, customers lose faith, and the once-promising brand is tarnished. How could this happen to a company on the brink of greatness? The answer is simple: negligence. Ignoring the importance of cybersecurity and essential tools, such as VPNs and secure cloud storage left the door wide open for disaster. Valuable and sensitive data, meant to be safeguarded, slips through their fingers like sand. This serves as a harsh reminder that no business, no matter how successful, is immune to the constant barrage of cyber threats. Ethical hackers, armed with their skills and principles, could have intervened. They could have searched for weak points and ensured that the company's sensitive data remained safe from unauthorized access. Secure cloud storage would have provided a fortress, a safe haven for critical information, accessible only to those entrusted with its protection. With encryption, multi-factor authentication, and strict data access controls, its walls would have been fortified, effectively repelling any malicious attempts to breach its defenses. Let this cautionary tale serve as a wake-up call to all organizations. May it urge them to embrace ethical hacking and proactive security measures. In this fast-paced digital jungle, ethical hacking shields us from lurking predators. From penetration testing to responsible disclosure, these white-hat warriors wield their tech prowess to keep our digital habitats safe......»»

Ukraine's use of Western vehicles has diminished Russia's ability to knock out the vehicles and the troops inside them in a catastrophic strike. A Ukrainian soldier next to a US-made Bradley armored vehicle at a secret workshop in a wooded area in the Zaporizhzhia region.Ed Ram/For The Washington Post via Getty Images Ukraine has lost protected mobility vehicles in its counteroffensive, including some Western-made vehicles. Because Western vehicle design prioritizes survivability, Ukraine's crews are surviving hard hits. Ukraine's Soviet-designed equipment wasn't created with the same priorities, experts say. Ukraine has lost new Western armored vehicles in battle, but despite Russian celebrations, these vehicle kills are not necessarily the wins they might have been against the Soviet-era systems Ukraine was using at the start of the war.Vehicles battered in combat can be repaired and replaced. The same isn't always true for trained crews or infantry inside them. Western vehicles are ensuring those troops survive even the brutal front-line combat of the ongoing counteroffensive.While Western vehicles, like the US-made Bradley fighting vehicle, come with impressive combat capabilities, Ukrainian troops say they are "vastly superior" to Soviet-era equipment, like BMP infantry fighting vehicles, because they are better at keeping the people inside alive, according to a new report on the Ukraine war.Western planning looks at protected mobility systems as tools to deliver infantry into the fight, which is quite different from the ways the Soviet planners looked at the situation.A destroyed BMP armored vehicle in a village in eastern Ukraine December 2022.SAMEER AL-DOUMY/AFP via Getty ImagesJack Watling and Nick Reynolds, land-warfare experts at Britain's Royal United Services Institute, wrote in the report that "for a Soviet mechanised section, its BMP was its primary weapons system, and so Soviet planners treated as synonymous the loss of the BMP with the loss of the section," but Western armies "treat mechanisation as an addition to basic infanteering."This very distinct "difference in mindset, combined with a different approach to losses, means that there is a heavy emphasis in Western platforms on the survivability of dismounts even if the vehicle is mission killed," they said.Simply put, the West builds its personnel carriers to keep people alive while the Soviets built their systems in such a away that if the armor was penetrated, it was "usually catastrophic for those inside it," Watling and Reynolds wrote. Life support wasn't the main priority.Russia has much more manpower, which means Ukraine really cannot afford to lose skilled vehicle crews and infantry units, and Western vehicles have proven rather effective at keeping Ukrainian troops in the fight even if they take a critical hit.Ukrainian soldiers and mechanics test drive a US-made Bradley at a secret workshop in the Zaporizhzhia region.Ed Ram/For The Washington Post via Getty ImagesThe key implication here is that were Ukraine still relying strictly on Soviet-era systems, personnel losses in its ongoing counteroffensive might have been substantially higher. At least, Ukrainian forces certainly seem to think so.A pair of Ukrainian soldiers, for example, credited the Bradleys Ukraine recently received with saving their lives early in the counteroffensive when their vehicle took multiple hits, telling ABC News that "if we were using some Soviet armored personnel carrier, we would all probably be dead after the first hit."In another example of the survivability of Western vehicles, a video showed the Ukrainian crew of a US-provided Humvee making it out alive after their vehicle was rocked by an explosion that might otherwise have been fatal. —Defense of Ukraine (@DefenceU) August 16, 2023 While armored vehicles from the West give Ukraine's front-line troops the ability to lose vehicles without necessarily losing their lives, preserving an essential and hard to replace resource, Kyiv's forces can't sustain substantial vehicle losses indefinitely."While Western-supplied protected mobility may be doing a good job at enabling their dismounts to survive," Watling and Reynolds wrote, "there is still a high loss rate of platforms."The experts noted that "these platforms are often mobility killed rather than destroyed," which is to say the vehicles aren't necessarily being destroyed, but the tracks, for instance, may be damaged to the point that the vehicle can no longer move, meaning it has to be recovered in order to be repaired.In those cases, recovering vehicles that crews were forced to abandon can be a challenge, especially if the other side intervenes.Ukrainian soldiers and mechanics change the wheels and tracks on a damaged Bradley at a workshop in the Zaporizhzhia region.Ed Ram/For The Washington Post via Getty ImagesWatling and Reynolds wrote in a previous report that "on several occasions, this tendency for stricken armour to be abandoned has led to extended skirmishing by both sides to try and recover damaged vehicles." They noted at that time that fire superiority often benefited the Russians, who could keep the Ukrainians at bay with artillery.That dynamic has somewhat shifted along the front lines, as devastating Ukrainian counterbattery fire, supported by the introduction of US-provided cluster munitions, has started to even the playing field, in some cases even giving Ukraine an edge.In their new report, Watling and Reynolds argue that "Ukraine's international partners need to ensure that the industrial support is available to make the Ukrainian military sustainable."That, however, can be a challenge in cases where a vehicle type or variant is no longer in production and spare parts for it may be in limited supply.Read the original article on Business Insider.....»»

The Only Thing We Have To Fear Is Extinction Itself Authored by James George Jatras A version of this presentation was given to the Ron Paul Institute's Scholars Seminar on Sept. 1st in Washington, DC. Today it’s hard for anyone under the age of 50 to appreciate how genuine and pervasive was fear of a nuclear holocaust during the Cold War between the US- and Soviet-led blocs. Books, movies, and TV both reflected and stoked popular anxiety about the possible “end of civilization as we know it.” The heyday for this was in the 1950s and 1960s, with books like The Long Tomorrow(1955) and On the Beach (1957, with a 1959 film adaptation), and films like Fail Safe, Seven Days in May, Dr. Strangelove (all in 1964, while the real-life scare of the 1962 Cuban Missile Crisis was fresh in people’s minds). There appeared to be a bit of a lull during the 1970s era of US-Soviet détente under Nixon, Ford, and Carter, perhaps also reflecting elite sympathy for socialism and an expected future convergence between the ideological groupings, which on a basic level shared the same globalist, materialist values. But nuclear terror returned with a vengeance in the 1980s – for example, The Day After (1983) and the animated When the Wind Blows (1986). And who can forget (certainly no male person!) the delightful Nena’s 1983 music video Neunundneunzig Luftballons. The Left, both in the United States and worldwide, was unanimous that Ronald Reagan, a self-confessed anti-communist, was a reckless cowboy who wanted to blow up the planet. As that great philosopher, Sting, put it in his 1985 song, “The Russians”: There is no historical precedent To put the words in the mouth of the president? There's no such thing as a winnable war It's a lie we don't believe anymore Mister Reagan says, "We will protect you" I don't subscribe to this point of view Believe me when I say to you I hope the Russians love their children too The irony is that Reagan’s own views were hardly different from the ones the song sought to promote. As he stated jointly with Soviet premier Mikhail Gorbachev that very same year, 1985: “A nuclear war cannot be won and must never be fought,” a view that prevailed until the USSR imploded just a few years later. We live in a very different world now, where the prospect of nuclear annihilation barely registers with anyone. Just as big earthquakes are often preceded by foreshocks, major wars are frequently heralded by smaller conflicts. Before World War One: the Franco-German Morocco crises (1906 and 1911), the Italo-Turkish War (1911-12), the two Balkan Wars (1912, 1913). Before World War Two: the Second Italo-Ethiopian War (1935-37) and, the most famous pre-conflagration rumble of them all, the Spanish Civil War (1936-39). Today, we are looking at a possible regional war in West Africa, centering on American and French demands that “democracy” be restored in Niger. (As one Indian publication put it, “Death follows Victoria Nuland”) Then, of course, there’s China/Taiwan. But the obvious Spanish Civil War-rank conflict of the moment is Ukraine. I don’t think we need to go into all the details of how we got here, but just in brief: Relentless NATO expansion after 1991; The 2014 US- and EU-backed coup that overthrew Victor Yanukovich, followed by the Russian annexation of Crimea and the new Kiev regime’s launch of a war to repress rebellions in the Russian-speaking east and south of the country;   The 2015 Minsk agreements, which provided for Ukraine’s neutrality and decentralization, and for reintegration of the rebellious areas with protections of their language and culture – agreements that both Ukrainian and European former officials have admitted they never intended to implement, seeing them only as a delaying ruse for building up a force capable of conquering the Donbas;   A relentless program of Ukraine’s NATO-ization in all but name under Obama, Trump, and Biden; and   Washington’s peremptory rejection of Moscow’s 2021 ultimata to the United States and NATO to resolve the conflict diplomatically, with the hope that Russia, baited into an incursion into Ukraine, would be bled white in an Afghanistan-style insurgency and by crushing sanctions that would “turn the ruble into rubble,” pancake Russia’s economy, and lead to regime change in Moscow. Oops. Russia’s expected ruin didn’t happen. Even the mainstream media cheerleaders of only a fortnight ago now admit that Ukraine is losing, assigning the blame not to the geniuses that thought up this strategy (if it can be called that) but to Ukraine’s being too “casualty averse” – even as that country is turning into one vast graveyard. There’s speculation that some in Washington and other western capitals are seeking an “off-ramp” – if for no other reason than the need to focus on the really big show, a looming war with China. Some suggest that in the end, we’ll just walk away, consigning Ukraine to the Memory Hole along with Afghanistan. All that’s left then is for GOP neocons to whine that the Biden Administration was too stingy with their aid and “lost Ukraine” while they gear up for the main event in the western Pacific. Personally, I don’t think that will happen. Nobody cares about Afghanistan but the Afghans, but if Washington walks away from Ukraine it’s effectively conceding that the US, through NATO, no longer is the security hegemon of Europe. That means the effective end of NATO, in fact if not in name; and where NATO goes, its concubine, the European Union, won’t be far behind. More to the point, though, the notion that this will soon end with a whimper misses the whole point. None of this is really about Ukraine, which is just an expendable tool to hurt Russia. (Maybe the Poles or Lithuanians or Romanians are eager to volunteer for the job once we’re fresh out of Ukrainians.) Ukraine is just a variable; the constant is Ruthenia delenda est. Russia must be destroyed. Gilbert Doctorow, a noted observer of Russian affairs, likens the current situation to that of Napoleon’s 1812 Russian campaign depicted by Leo Tolstoy in War and Peace. Today as then, what happens next will be less due to this or that policymaker making this or that bad decision. Rather, “the precondition for war is the near universal acceptance of the logic of the coming war.” What is that logic today? It’s simple: the ruling circles in the United States (needless to add, with their sock puppets in western capitals) are utterly, unselfconsciously convinced that they are the living embodiment of all virtue, truth, and progress in what Russian Foreign Minister Sergei Lavrov described as the “replication of the experience of Bolshevism and Trotskyism” – to cite Reagan, morphing ourselves into a new Evil Empire in place of the old one. As neocon kingpins William Kristol and Robert Kagan put it in their 1996 manifesto, the policy of the United States in the coming era must be one of “benevolent global hegemony” intended to last – well, forever. Its moral content is exemplified, on the one hand, by US support for subjugation of the canonical Ukrainian Orthodox Church and, on the other, the spectacle of a transgender US serviceperson acting as a PR official for the Ukrainian military declaring that “we’re human,” and the Russians “most definitely aren’t.” As I like to say: there’s no Transatlanticism without transgenderism. Unsurprisingly, regarding their alleged lack of human-ness, the Russians disagree. But who cares what they think? Our leaders see not only Putin but Russians in general as an obstacle to the radiant future, where every knee will bow before the sacred rainbow flag. Sun Tzu says “If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know neither the enemy nor yourself, you will succumb in every battle.” The Russians more or less know themselves. They kind of know us, but not as well as they think they do, with rather a tendency to project normalcy onto fundamentally abnormal people. On the other hand, our rulers – dangerous people whose levels of arrogance and ignorance defies description: monkeys with nuclear hand grenades – know neither themselves nor the Russians. On top of that, as Doctorow further observes, the mechanisms that lent some stability and restraint to the US-Soviet standoff are now all but gone, rendering the once-“unthinkable” of the 1950s’ nuke horror films all-too-thinkable today: ‘… no one wants war, neither Washington nor Moscow. However, the step-by-step dismantling of the channels of communication, of the symbolic projects for cooperation across a wide array of domains, and now dismantling of all the arms limitation agreements that took decades to negotiate and ratify, plus the incoming new weapons systems that leave both sides with under 10 minutes to decide how to respond to alarms of incoming missiles—all of this prepares the way for the Accident to end all Accidents.  Such false alarms occurred in the Cold War but some slight measure of mutual trust prompted restraint. That is all gone now and if something goes awry, we are all dead ducks.’ “No one wants war.” A similar thought was expressed by Hermann Göring, when he was on trial at Nuremberg: Of course the people don't want war; neither in Russia nor in England nor in America, nor for that matter in Germany. That is understood. … But after all, it's the leaders of the country who determine the policy, and it's always a simple matter to drag the people along whether it's a democracy, a fascist dictatorship, or a parliament, or a communist dictatorship. Voice or no voice, the people can always be brought to the bidding of the leaders. That is easy. All you have to do is tell them they are being attacked, and denounce the pacifists for lack of patriotism, and exposing the country to greater danger. So I guess Doctorow is a bit off the mark in suggesting that “no one wants war.” Clearly, somebody wants war. A lot of very important “somebodies” wanted this war in Ukraine. They wanted war in the Balkans in the 1990s. They wanted war in Afghanistan, Iraq (twice!), Libya, Yemen, Syria, and a dozen places in Africa where we have almost no idea what’s going on. “All you have to do is tell them they are being attacked…” I can’t help but think of the meme with two blank-face NPCs, one wearing a pink knit hat mindlessly repeating “Russia! Russia! Russia!,” the other with a red MAGA hat chanting “China! China! China!” Between them is the seal of the CIA with the eagle saying, “Yes, yes, my pretties. That’s it. That’s it.” Here we are, 60 years after the fact, with the growing recognition by even the most spoon-fed normies that the CIA had something to do with the assassination of Jack Kennedy. In fact, we have here today perhaps the foremost authority on the topic, Mr. Jacob Hornberger. Yet doubting our rulers’ truthiness still is treated as a thought crime. A little while ago, Vivek Ramaswamy was the target of a media hate fest for (in the words of The New Republic) “spout[ing] conspiracy theories about January 6 and 9/11.” Oh no! “Conspiracy theories”! (Or, as they are known when they turn out to be true, “spoiler alerts.”) The heretic Ramaswamy evidently believes – shocking as this sounds – that our government has not been entirely honest about these matters. He must be a dupe for the Russians! Or for the Chinese! – which The New Republic also implies. You may have heard some people compare the “lawfare” being directed against Donald Trump, with the evident aim of eliminating the likely opponent next year of the desiccated-husk-of-Hunter-Biden’s-dad (assuming ol’ Joe will be the Democratic nominee, which I don’t), to the behavior of a banana republic. This is a gratuitous insult to the friendly spider-infested nations to our south! I recently suggested to a sober observer of public affairs that the strategic goal is keeping Trump off the ballot in one or more must-win states for him, like Pennsylvania, Michigan, Georgia, Arizona, to which he responded: “That’s a recipe for civil war.” (I tried to imagine what Republicans taking to the streets would look like. A mob of decrepit Boomers rolling their motorized wheelchairs down to the corner and burning down the post office?) Anyway, taking him out via lawfare seems to be Plan A. If that fails – well, Plan B would get us into Mr. Hornberger’s area of expertise. The term “cold” civil war, a war that might possibly turn “hot,” has become a commonplace in American discourse. So has the expression “national divorce.” In 1861 Americans both North and South worshipped the same God, read the same Bible, honored the same Founding Fathers, claimed fidelity to the same Constitution. In today’s America, we can’t even agree on our pronouns or on what a “woman” is, much less on what it means to be an American. We are moral aliens to one another, indeed enemies. What actually holds the former American republic together? “Muh Constitution”? “Muh democracy”? Keep in mind, we’re not talking about a mere political crisis that will get solved in an election or two. Not even about political and constitutional collapse, or even a financial and economic calamity – that’s coming too, in part because of the impact of the Ukraine war on the dollar-denominated global system – but a fundamental challenge to the social fabric itself, and not just in the United States. A watershed was passed with covid and the measures – the lockdowns, the masks, social distancing and monitoring, the clot shot, censorship of dissent, all combined with a pervasive, inescapable external and internal panopticon: as the troubadour of transhumanism Yuval Harari writes, “we are seeing a change in the nature of surveillance from over the skin surveillance to under the skin surveillance” – supposedly intended to deal with a virus, accomplishing within a few short months what decades of climate hysteria could not, summed up under the moniker “the Great Reset” and its ubiquitous slogan “Build Back Better.”’ Taken together what we’re experiencing has all the appearance of a controlled demolition of all established human interactions in anticipation of their replacement by something we are assured by our betters will be an improvement. The contours of the “new normal” in the post-American America hurtling in our direction have already become so familiar as to need little elaboration: Infringement of traditional liberties based on “keeping us safe”;   “Cancel culture”;   Blurring of the lines between Big Government, Big Finance, Big Pharma, Big Data, etc., amounting to corporate state capture; and, not directly based on supposed anti-virus measures but closely tracking with them,   Joint government and corporate promulgation of socially destructive, historically counterfeit ideologies (“intersectionality,” LGBTQI+++, feminism, multiculturalism, “critical race theory,”), with principal targeting of children subject to sexualization and predation by those expressing what were once quaintly known as abnormal appetites and identities. These so-called “values” – which, remember, are effectively the official ideology of the West, which we seek “benevolently” to impose on the rest of the world, by force if necessary – in turn accelerate longstanding trends towards infertility and demographic collapse pointing to thinning the human herd and replacement via post-human society, transhumanism, and bio-engineering. This is not just “political” but a strike at the heart of human existence: the spiritual, moral, and even biological basis for marriage, family formation, and production of the next generation. In a word: depopulation. A few years ago, His Royal Highness, the late Prince Philip of the United Kingdom, perhaps half in jest delivered this thigh-slapper: “In the event that I am reincarnated, I would like to return as a deadly virus, to contribute something to solving overpopulation.” Some of you may have heard of groups like Extinction Rebellion and BirthStrike: “Are you terrified about the future that lies ahead for contemporary and future youth? Do you want to maximize your positive impact on the Climate Change Crisis? You can protect children while fighting climate change and systematic corruption by refusing to procreate!” Makes perfect sense: preserve a better planet for future generations by eliminating future generations. It reminds me of Otto von Bismarck’s comparing the idea of preventive war to committing suicide out of fear of death. (That’s not as abstract as it might sound. Recently a young woman in Canada seeking help for depression and suicidal ideation was advised by hospital staff that she might be interested in their tried and Trudeau-ed “Medical Assistance in Dying (MAID)” euthanasia program. Tempted to kill yourself? Let us help you!)  But why stop at half measures? The Voluntary Human Extinction Movement, VHEMT (pronounced “vehement,” according to their website): “We’re the only species evolved enough to consciously go extinct for the good of all life, or which needs to. Success would be humanity’s crowning achievement. May we live long and die out.” Maybe they’re on to something! In his landmark work The Socialist Phenomenon, the late Russian mathematician and student of history Igor Shafarevich took note of what he believed is a collective human death impulse: The idea of the death of mankind—not the death of specific people but literally the end of the human race—evokes a response in the human psyche. It arouses and attracts people, albeit with differing intensity in different epochs and in different individuals. The scope of influence of this idea causes us to suppose that every individual is affected by it to a greater or lesser degree and that it is a universal trait of the human psyche. This idea is not only manifested in the individual experience of a great number of specific persons, but is also capable of uniting people (in contrast to delirium, for example) i.e., it is a social force. The impulse toward self-destruction may be regarded as an element in the psyche of mankind as a whole. [ … ] In the Freudian view (first expressed in the article “Beyond the Pleasure Principle”), the human psyche can be reduced to a manifestation of two main instincts: the life instinct or Eros and the death instinct or Thanatos (or the Nirvana principle). Both are general biological categories, fundamental properties of living things in general. The death instinct is a manifestation of general “inertia” or a tendency of organic life to return to a more elementary state from which it had been aroused by an external disturbing force. [“Dust thou art, unto dust shalt thou return.”] The role of the life instinct is essentially to prevent a living organism from returning to the inorganic state by any path other than that which is immanent in it. Marcuse [Shafarevich refers here to Herbert Marcuse, theorist of the Frankfurt School, known for his adaptation of the theory of class conflict in classical Marxism to other social divides, notably in the area of sex, setting the stage for “intersectionality”] introduces a greater social factor into this scheme, asserting that the death instinct expresses itself in the desire to be liberated from tension, as an attempt to rid oneself of the suffering and discontent which are specifically engendered by social factors. With the failure of the Ukrainian offensive, Moscow now faces a dilemma. Do they move decisively to impose a military solution that ends the war, or do they continue to show restraint in the hopes that somebody, somewhere – Kiev, Washington, London, Brussels – decides it’s time to sue for peace? Keen not to take a precipitous step that might bring about a direct clash of NATO and Russian forces, so far they’ve opted for the latter – I repeat: so far. The West faces its own dilemma. Do our rulers concede defeat, which effectively means the end of the Global American Empire (the GAE)? Or do they drag things out as long as possible, hoping Moscow will fall for another Minsk-type ceasefire, with the Kremlin playing the part of Charlie Brown taking another run at kicking the football, having been promised that this time we’ll keep our word? Or, mistaking Russian restraint for weakness, do they push the envelope by inserting a “coalition of the willing” into western Ukraine, challenging Russian naval forces in the Black Sea, encouraging and equipping the Ukrainians to step up attacks on Moscow and other Russian cities, staging some sort of false flag of the type that has proved so effective in other conflicts? In other words, do we double down? That’s in addition to opening up other asymmetrical theaters in the Balkans, Syria, Iran, the Taiwan Strait, and elsewhere. In mistakenly projecting a rational actor mentality onto their opponents, the Russians seem to be acutely aware of the legitimate concern that decisive military action on the ground could panic NATO and trigger an uncontrolled escalation. They seem oblivious to the contrary concern, that, by holding back and waiting for a reasonable dialogue that will never take place, they are in effect encouraging their adversary to stage one reckless provocation after another – in the sustained belief that some deus ex machina can snatch victory from the jaws of defeat – resulting in the very uncontrolled escalation that Moscow seeks to avoid. Even these speculations assume that the miserable specimens of humanity calling the shots in Western capitals would only risk a direct conflict but would not deliberately choose it. But is that assumption correct? As Doctorow notes, the old Cold War restraints have broken down. Maybe demonstration of a teeny-tiny, low-yield nuke is just the thing to show that non-human Vladof Putler that the GAE is serious! What could possibly go wrong? Recently on his podcast Judge Andrew Napolitano showed part of a computer simulation of a US-Russia nuclear exchange in which the initial toll on the US population was only (“only”!) about nine percent, while on Russia it was around 62 percent. (Given that Russia has more warheads than we do, I don’t know how they came up with that, but I didn’t conduct the simulation.)  Is it so impossible that somewhere, somebody might look at those data and decide it’s a tolerable tradeoff? (Later on, the simulation has pretty much everyone on earth starving to death from nuclear winter, with agriculture in the northern hemisphere unviable for several years. Now there’s a way to resolve both global warming and supposed overpopulation with one stroke! Hey, VHEMT, have we got a concept for you!) Whether or not these dolts manage to kill us all, either by deliberate action or through sheer incompetence, it’s hard to escape the notion that we are approaching the edge of some profound historical moment that will have far-reaching, literally life and death consequences, both domestically and internationally. In the period preceding World War I how many Europeans suspected that their lives would soon be forever changed—and, for millions of them, ended? Who in the years, say, 1910 to 1913, could have imagined that the decades of peace, progress, and civilization in which they had grown up, and which seemingly would continue indefinitely, instead would soon descend into a horror of industrial-scale slaughter, revolution, and brutal ideologies? Which brings us to my parting admonitions to your predecessors in this seminar, which I see no need to change: My young friends, the impact any one of us can expect to have in the face of world-historic trends before which the fates of nations and empires fly like leaves in the autumn winds is vanishingly small. Already baked into the cake will be, I believe, hardships for you that we’ve become accustomed to think only happen to “other people” in “other countries” far away, not seen here since the Revolution and the Civil War, or maybe in isolated instances during the Great Depression: financial and economic disruption and, in some places, especially in urban areas, collapse; supply chains, utilities, and other aspects of basic infrastructure ceasing to function (what happens in major cities when food deliveries stop for a week?), even widespread hunger; rising levels of violence, both criminality and civil strife. These will be combined, paradoxically, with the remaining organs of authority, however discredited, desperately cracking down on the enemy within – no, not on murderers, robbers, and rapists, but on “science deniers,” “religious fanatics,” “haters,” “conspiracy theorists,” “insurrectionists,” “gun nuts,” “purveyors of “medical misinformation,” Russian or Chinese “stooges,” and, of course, “racists,” “sexists,” “homophobes,” and so forth. It’s the late Samuel Francis’ “anarcho-tyranny” nightmare come to life with a vengeance. Nevertheless, for what it is worth, I put before you three practical tasks for your consideration. Firstly, be vigilant against deception, in a day when assuredly evil men and impostors will grow worse and worse, deceiving, and being deceived. Admittedly, this is a tough one, given the ever-present lying that surrounds us and the suppression of dissent. Try to sift truth from falsehood but don’t become obsessed because, in many cases, you won’t be able to be sure anyway. Focus most on what’s proximate to you and on the people most important to you. … Be skeptical – about everyone. … There may be a cost. As Solzhenitsyn said, “He who chooses the lie as his principle inevitably chooses violence as his method.” Secondly, as stewards of every worldly charge placed on us by God and by other people—as fathers and mothers, as husbands and wives, as sons and daughters, as neighbors, as students, as workers, as citizens, as patriots—we must prudently care for those to whom we have a duty within the limited power and wisdom allotted to us. Start with yourselves. Be as self-sufficient as possible. Get involved in your community; that leftist slogan is actually a good one: think globally, act locally. Befriend your neighbors. Learn a real skill – electricity, plumbing, carpentry. Farm! Don’t go to law school, for goodness’ sake. Get in shape. Eat and sleep right. Have plenty of the essentials: food, fuel, gold, ammunition. Learn to shoot. Limit computer and phone time. Experience nature. Cultivate healthy personal relationships – real ones, not virtual ones. Marry young, have kids, lots of them – especially women, don’t get seduced by all that “career” nonsense. Nobody on his or her deathbed ever said, “Gosh, I wish I’d spent more time at the office.” Read old books. Cultivate virtue. Go to church. Simply being what used to be considered normal and leading a productive life is becoming the most revolutionary act one can perform. With that in mind, find the strength to be revolutionaries indeed! In the face of the culture of death and extinction, choose to affirm life. You’ve seen the meme: Hard times create strong men; Strong men create good times; Good times create weak men; Weak men create hard times. Well, take it from the weakling Boomer generation that brought them to you: the hard times, they is a-coming. But they won’t last forever. If you live through them – and some of you will not – we’ll see what possibilities, as of now literally unimaginable, might then exist. But you will need to be personally fit to take advantage of them. You will also need to be part of some kind of sustainable community of likeminded people. Thirdly, for those of you who are believers, particularly Christians, we must pray without ceasing, firm in faith that, through whatever hardships may lie ahead, even the very hairs of our head are all numbered, and the final triumph of Truth is never in doubt. Thank you, and good luck. You’re going to need it. Tyler Durden Wed, 09/06/2023 - 23:45.....»»

The AirBnB Bubble Popping Will Pop The Housing Bubble Authored by Charles Hugh Smith via OfTwoMinds blog, This is how bubbles collapse: the "vital few" 4% sell at whatever the market will bear, pushing prices down, and the 64% awaken to the rapidly narrowing window for locking in bubble capital gains. Here's how we can tell if a speculative bubble is a bubble: everyone says it isn't a bubble - the market has reached a "permanently high plateau" because valuations are now fairly priced, etc. Housing globally is in a bubble (See chart below) which we're constantly assured isn't a bubble. As I discussed yesterday ( The Problem Isn't a Housing Shortage, It's the Concentration of Ownership by the Wealthy), this bubble is fundamentally an artifact of central bank and government policies that enrich the already-rich, who were incentivized to outbid each other with low-cost credit to snap up "investment properties" with their "surplus capital" that generate more income and capital gains that cash, which until recently was "trash" due to near-zero savings yields. Many wealthy families collect multiple properties via inheritance, as second (vacation) homes or as long-term rentals. This hoarding is (as I explained) the only possible result of policies that asymmetrically distribute credit, and thus income and capital gains, to the already-wealthy rather than to the not-yet-wealthy. This policy-driven hoarding / concentration of housing in the top 10% is one factor driving rents higher due to artificial scarcity--a scarcity created by central bank and government policies, not the "market." (Regulations and bureaucratic friction that push the cost of new constriction to the moon are another factor, but that's a topic for another post. I also want to stipulate that I am not talking about people of modest means who acquired rental properties by scrimping and saving their earned income and making sacrifices for decades--a strategy that is part of Self-Reliance; I'm talking about the already-wealthy who are seeking to "maximize returns" on their unearned "surplus capital.") A systemic driver of this bidding war for rental properties is the "AirBnB" model of monetizing individual properties to compete with hotels and resorts for lodging. This model is called short-term vacation rentals (STVR), and the already-rich have been pouring their wealth into STVRs for the past 15 years. This has led to an artificial scarcity of housing in popular tourist destinations. It's not uncommon to visit tourist-magnet cities and see entire buildings with only a few lights on, as many units are owned by the wealthy and left empty, as rents are not as important as having a safe place to "park surplus capital." Thousands of other units have been pulled from the long-term rental market to reap the higher returns of STVRs. Many cities and locales are finally pushing back against the housing hoarding of the global wealthy, taxing empty units and limiting and/or licensing STVRs. As I explained yesterday, the flood of post-pandemic price-insensitive "revenge spending" pushed tourist lodging rates to the moon as resorts and STVRs competed on exploiting price-insensitive tourists. What's often forgotten about real estate is prices are set on the margin. The Pareto Distribution is a handy tool for understanding how an entire neighborhood's home prices are re-set by a mere handful of sales. The Pareto Distribution is often summarized as the 80/20 Rule. The 80/20 rule can be distilled down to 80% of 80% and 20% of 20% to the 64/4 Rule: the "vital few" 4% exert outsized influence over the 64% mass. So 4% of sales can re-set the valuation of 64% of all neighboring houses. So 40 houses selling for around $450,000 will re-set the valuation of 1,000 nearby homes from $800,000 to $450,000. This is why an apparently modest number of fire sales of money-losing STVRs will dissolve the floor under bubble valuations. The STVR bubble was entirely an artifact of 1) historically absurdly low mortgage rates and 2) post-pandemic price-insensitive "revenge spending". Both are over. There is no way the bottom 90% can afford homes at today's bubble valuations, so the pool of buyers is limited to the top 10% already-wealthy, whose appetite for owning "surplus capital" rentals vanishes once the lofty weekly rates and low vacancies reverse into high vacancies and collapsing rental rates. The bottom 90% have tapped out their pandemic windfalls and their lines of credit. The erosion of the global economy will deflate bonuses, capital gains and all the other sources of the top 10% "wealth effect," and credit will tighten as risk aversion and higher rates turn the spigot of easy credit off for the already-wealthy. The collapse of the STVR bubble will topple a line of dominoes as corporate owners will awaken from their fantasies and realize they better sell now to lock in their gains before they vanish. Wealthy households who "land-banked" properties for capital gains and places to park "surplus capital" will also awaken to the the need to lock in gains by selling. This is how bubbles collapse: the "vital few" 4% sell at whatever the market will bear, pushing prices down, and the 64% awaken to the rapidly narrowing window for locking in bubble capital gains. This rush for the exits triggers a strike in buyers, who realize there is no way to know how low valuations will fall, and so waiting for a bottom makes much more sense that playing "catch the knife," i.e. buying as a bubble deflates, hoping you don't get burned by prices falling after overpaying. *  *  * My new book is now available at a 10% discount ($8.95 ebook, $18 print): Self-Reliance in the 21st Century. Read the first chapter for free (PDF) Become a $1/month patron of my work via patreon.com. Subscribe to my Substack for free Tyler Durden Sun, 08/27/2023 - 15:30.....»»

The Alliance Authored by Robert Gore via Straight Line Logic, Banging one’s head against the wall is not a wise strategy... Russia and China head an alliance that poses the first direct challenge to the American empire since its inception at the end of World War II. Their strategy has been to follow Napoleon’s advice—not interrupting the U.S. government while it makes mistake after mistake—and to pursue the opposite of its hapless policies. Their power waxes; American power wanes. August 29, 1949, the day the Soviets detonated their first atomic weapon, was the beginning of the end of the American empire. The U.S. government’s unrivaled power lasted four years and 23 days, from when it dropped an atomic bomb on Hiroshima. The Soviet bomb gave the world a counterweight to an American nuclear monopoly. It is unclear if the Cold War was anything but a giant psyop on the part of the U.S. and the Soviet Union. By 1960 they had enough bombs between them to wipe out the planet, John F. Kennedy’s “missile gap” notwithstanding. This left a world where sane people believed that military conflicts had to be nonnuclear. The U.S. became the national security, or warfare, state with which the nation is burdened today. In dollars and cents, it’s the second largest grift in history, surpassed only by the U.S. welfare state. The U.S. populace is always threatened by some megalomaniacal and evil power somewhere. Even conflict far from U.S. shores threatens the U.S. because of falling dominoes or because it’s better to fight them there than here. Or because U.S. “interests” are at risk. This has become the go-to justification: “interests” are anything the war lobby says they are. The U.S. is fighting Russia via Ukraine to push NATO to Russia’s doorstep. Beyond the specious rhetoric of saving democracy and freedom in a police state riddled with neo-Nazis, it has to do with taking Ukraine’s natural and agricultural resources, hiding U.S. bioweapons labs, preventing disclosure of U.S. politicians’ links to Ukrainian corruption, and effecting regime change in Russia. Someday there will be general recognition of Putin’s adroit conduct of the Ukraine-Russia war and the strategic masterstroke that is the Russia-China alliance. Losers on a roll require a hard, painful landing before they begin to wise up, if they wise up at all. The losers running the U.S. and its vassals are in for some hard, painful landings. When they look up from the gutter, drunks soaked in their own vomit, they’re going to see Putin and Xi Jinping, staring down at them with nothing but contempt. It is well-earned. The U.S.’s annually spends three times what China and ten times what Russia spend and gets inferior weapons and a bloated, politically correct military. The waste of blood and treasure on imperial misadventures in Afghanistan, Iraq, Syria, Libya, and now Ukraine has been incalculable. Wasted treasure funds rampant corruption and has helped shove the U.S. into an abyss of debt. American self-confidence and justifiable pride in its history and culture have been thrown over in favor of nonsense. The U.S. government is the world’s most hated institution. If Ukraine doesn’t end its imperial misadventures Taiwan will, and there will no longer be an American empire. The Russian military doesn’t do shock and awe. It does grind, advance . . . and win. Contrary to Western propaganda, it is well on its way to achieving its objectives in Ukraine. . . . “Reckoning With Insanity, Part Two,” by Robert Gore, SLL, 6/2/22 Russia has mostly achieved its military objectives in Ukraine. Putin has been criticized for the slow grind, but Russia has annexed the Russian-speaking areas of eastern and southern Ukraine and secured land access and the water supply to Russian-speaking Crimea, already annexed. Russia has minimized its loss of life and destruction of weaponry and maximized Ukraine’s. An open question is whether Russian mounts an offensive against Odessa in southwestern Ukraine, completely cutting off its access to the Black Sea. Ukraine’s president Zelensky talks of taking back captured territory. Such deluded bravado lends credence to the claims he’s a cocaine addict. Ukraine’s counteroffensive has been a dismal failure, floundering on Russia’s defensive strategy. Ukraine has seldom been able to advance past Russia’s buffer zones, much less penetrate its complex multi-layer defenses. Estimates vary, but casualty ratios of seven- to ten-to-one against Ukraine are probably in the right ball park. Men and machinery have been fed into a Russian meat grinder, leaving Ukraine woefully unprepared for a Russian counteroffensive should the Russians decide to mount one. Ukraine has an estimated 300,000 to 350,000 killed, including the cream of its military. Millions of Ukrainians have fled the country, and Russia now controls most of its best farmland and mineral wealth. If it cuts off Black Sea access Ukraine will be a carcass state with little to offer to Western financial vultures. Early on in the war Russia and Ukraine had a tentative peace deal, which the U.S. and Great Britain nixed. You only get one chance to accept a Russian deal, and then the offers get progressively worse. The nixed deal would have been far more favorable to Ukraine and NATO than the terms Russia will eventually impose. The meme-fodder picture of a forlorn Zelensky standing by himself at a NATO reception starkly illustrates that his “allies” are backing away. So, what did the Ukrainians do to raise the ire of the Pentagon so suddenly, and as a direct consequence, fall into disfavor with NATO? In short, the Ukrainians demonstrated that NATO’s weapons are crap. Evidence of this built up slowly over time. First, it turned out that various bits of US-made shoulder-fired junk — anti-aircraft Stingers, anti-tank Javelins, etc — are rather worse than useless in modern combat. Next, it turned out that the M777 howitzer and the HIMARS rocket complex are rather fragile and aren’t field-maintainable. The next wonder-weapon thrown at the Ukrainian problem was the Patriot missile battery. It was deployed near Kiev and the Russians quickly made a joke of it. They attacked it with their super-cheap Geranium 2 “flying moped” drones, causing it to turn on its active radar, thereby unmasking its position, and then fire off its entire load of rockets — a million dollars’ worth! — after which point it just sat there, unmasked and defenseless, and was taken out by a single Russian precision rocket strike. This was sure to have seriously pissed off US Secretary of Defense Lloyd Austin, whose major personal cash cow happens to be Raytheon, the maker of the Patriot. . . . “The Incredible Shrinking Nato,” Dmitry Orlov, July 15, 2023 Not only does a country that spends a tenth of what the US does have superior weaponry, it has superior production capabilities. Wagner PMC head Eugene Prigozhin’s complaints notwithstanding, the Russian military seems to have what it’s needed to decimate Ukraine. Meanwhile, arsenals are running low in the U.S. and Europe and they’re resorting to desperation weapons—cluster munitions and depleted uranium shells—which will render parts of Ukraine toxic for decades. Just as humiliating for the West has been its economic sanctions. They were designed to devastate the ruble, stop foreign trade, and bring Russia’s economy to its knees. They’ve done none of the above and the Russian economy is growing. Cutting off cheap Russian natural gas and replacing it with expensive American liquified natural gas hasn’t had a salutary effect on European economies. Western economic statistics are a division of Propaganda Central, but it appears that recession either looms or has arrived for much of Europe. Cheap Russian oil and natural gas isn’t coming back. If Seymour Hersh is to be believed, the U.S. blew up the European-Russian Nord Stream pipeline. Further proof of the old adage that you’re better off being America’s enemy than its friend. For decades, America’s foreign policy doyens have counseled against doing anything that would bring Russia and China together. That wisdom is out the window. While international diplomacy has no matches made in heaven, the Russian-Chinese alliance is about as close as it gets. Marry Russian natural resources to the Chinese industrial machine and maintain joint control of what’s been considered the center of the world since Halford MacKinder’s seminal paper back in 1904, and you’ve got one of history’s most formidable alliances. It is deftly incorporating much of the non-Western world, what Belarusian President Alexander Lukashenko calls the “Global Globe.” Trade arrangements, infrastructure financing and construction, and new transport, communications, and computer links are the face of an emerging, assertive multipolarity. Initially centered in Eurasia, this complex web of political and commercial agreements is extending to the Middle East, South America, and Africa. The U.S. call for universal mobilization against Russia’s invasion of Ukraine was met with indifference outside the West. The Global Globe has grown weary of the U.S.’s rules-based international order, which amounts to acceptance of U.S. diktat . . . or else. The U.S. government follows or disregards its own rules at its convenience. Not only are the Russians and Chinese offering better terms, but their carefully crafted rhetoric is that of partnerships, equality, and multipolarity. The American empire’s subjugation and hypocrisy are sandpaper on billions of open wounds. Only Americans are surprised by the seething resentment. It’s not going away anytime soon. The alliance has another ace up its sleeve. The ideas that fiat emissions are money and that something can be had for nothing have left Western governments with mountains of debt and unfunded obligations that will never be paid. Debt has reached its hamster-wheel inflection point: more spending leads to more debt leads to higher interest costs leads to more spending. Gold is money; everything else is credit, and fiat debt and currencies are barbarous relics. Shifting the Global Globe away from fiat towards gold is going to be a monumental task, but indications are that gold-rich Russia and China are undertaking it. If they eventually adopt a currency or currencies that can be freely exchanged for gold, the dollar’s days as the global reserve currency will be over. Good as gold beats barbarous fiat every time. Feeble and corrupt Joe Biden is America’s nominal leader. His camarilla is made up of nonentities who would require substantial upgrades to hit either mediocre or amoral. The rest of the West’s so-called leadership is no better. This state of affairs must strike Putin and Xi Jinping as fortuitous. They have to worry about global reverberations of Western economic collapse and the possibility that Western leaders, desperate from their Ukrainian military failure, might take it nuclear. However, nothing is quite as satisfying as watching your adversaries checkmate themselves. Russia and China are winning the global chess match. That’s not to say they’ll always win. Both governments are the usual top-down, repressive, organized crime that carries the seeds of its own destruction. However, the U.S. government is banging its head against a wall trying to impose its brand of imperialism on the two. Reality, the ultimate wall, always wins. Only after the tidal wave of consequences breaks will the U.S.—or parts of it—have a chance to recover. Recovery will lie in the rediscovery of enduring truths. The game of thrones is a game of fools. A nation’s greatness is the liberty of its citizens to live their lives and pursue their happiness. The best foreign police is peace, commerce and honest friendship with all nations; entangling alliances with none. There’s no such thing as a free lunch. Anything the government gives you it took away from someone else. A government big enough to give you everything you want is a government big enough to take away everything that you have. Like fire, government is a dangerous servant and a fearful master. The more corrupt the state, the more numerous the laws. Power corrupts, and absolute power corrupts absolutely. A is A. Tyler Durden Sat, 08/12/2023 - 19:30.....»»

Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS) Q2 2023 Earnings Call Transcript August 3, 2023 Kratos Defense & Security Solutions, Inc. beats earnings expectations. Reported EPS is $0.09, expectations were $0.05. Operator: Good day and thank you for standing by. Welcome to the Kratos Defense & Security Solutions Second Quarter 2023 Earnings Conference Call. All […] Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS) Q2 2023 Earnings Call Transcript August 3, 2023 Kratos Defense & Security Solutions, Inc. beats earnings expectations. Reported EPS is $0.09, expectations were $0.05. Operator: Good day and thank you for standing by. Welcome to the Kratos Defense & Security Solutions Second Quarter 2023 Earnings Conference Call. All participants are in a listen-only mode. After the speakers presentation there will be a question-and-answer session. [Operator Instructions]. Please be advised that today’s conference is being recorded. I would now like to hand the conference over to your speaker today, Marie Mendoza, Senior Vice President, General Counsel. Please go ahead. Marie Mendoza: Thank you. Good afternoon, everyone, and thank you for joining us for the Kratos Defense & Security Solutions second quarter 2023 conference call. With me today is Eric DeMarco, President and Chief Executive Officer, and Deanna Lund, Kratos’ Executive Vice President and Chief Financial Officer. Before we begin the subject of today’s call, I’d like everyone to please take note of the safe harbor paragraph that is included at the end of today’s press release. This paragraph emphasizes the major uncertainties and risks inherent in the forward-looking statements we will make this afternoon. Please keep these uncertainties and risks in mind as we discuss future strategic initiatives, potential market opportunities, operational outlook and financial guidance during today’s call. Today’s call will also include a discussion of non-GAAP financial measures as that term is defined in Regulation G. Non-GAAP financial measures should not be considered in isolation from or as a substitute for financial information presented in compliance with GAAP. Accordingly, at the end of today’s press release, we have provided a reconciliation of these non-GAAP financial measures to the company’s financial results prepared in accordance with GAAP. With that, I will now turn the call over to Eric DeMarco. Eric DeMarco: Thank you, Marie. Good afternoon. Q2 came in better than forecasted which provides us additional confidence in achieving as our full year 2023 financial objectives, including increased second half profitability as our fixed price and other contract mix continues to improve. We are on plan for 2023 to be a transition year for Kratos including reduced internally funded investments and increased year-over-year financial performance. Kratos’ largest business, space and satellite communications, which includes our first to market software based OpenSpace virtualized C2, TT&C and ground system products momentum continued, including additional new customer awards and several new opportunities we are now pursuing. The large number of satellites being launched into LEO, MEO and GEO orbits is providing a macro level catalyst for our satellite business, in both the commercial and national security areas. Our OpenSpace platform is a representative example of Kratos’ strategy of identifying a potential opportunity area, working with the customer, Kratos making the internally funded investment to be first to market with relevant system software and technology. Kratos’ internal funding also enables us to own and protect the proprietary intellectual property we develop, which is an important element in protecting our market leadership position. Kratos’ OpenSpace architecture enables us to address both the commercial and the national security areas, providing us a larger overall total addressable market opportunity and the associated scale, cost leverage and increased potential margins that come with it. We are also invested in and self-funded Kratos’ owned and operated global space domain awareness or SDA network. Our SDA network monitors the behavior of space based radio frequency or RF signals to identify critical information about satellites and objects in orbit, including their position, maneuvering health, proximity to other satellites and more. Kratos’ SDA network includes over 20 worldwide sites currently hosting approximately 150 fixed and steerable RF sensors and antennas, which are capable of detecting and tracking space vehicles and providing real time data to our customers. It’s been recently reported that the U.S. space command is currently tracking and monitoring more than 28,000 space objects, of which only approximately 3,500 are acknowledged active satellite with this growing volume of satellites and space objects contributing to Kratos’ space domain awareness market opportunity. Kratos owned and operated one of a kind global SDA system is a clear differentiating technology based capability of our company and it’s one of Kratos’ most valuable assets. Also providing opportunity for Kratos is that a significant number of new satellites being launched are high throughput, software reconfigurable, spot beam enabled and more each of which requires a dynamic on the fly reprogrammable ground infrastructure and capability like Kratos’ OpenSpace. Additionally, the customers increased focus on not being vendor locked to the traditional satellite providers for their ground infrastructure is also providing opportunity for Kratos. The large growing and changing global space and satellite market is providing opportunity for every Kratos division including individually and working together on programs, which has been a key aspect of Kratos’ overall space focused strategic plan. We expect Kratos’ space and satellite business to be one of our company’s fastest growers with forecast future year-over-year increased revenue, profit margins and cash flow. Kratos’ engine and propulsion businesses are also in well-funded growing priority areas, with macro catalysts including increased demand for hypersonic systems, missiles, drones, powered and loitering munitions, increased range and power requirements, supersonic and space and satellite related propulsion and launch systems. Kratos’ turbine technologies is a recognized leading technology disruptor in the propulsion field and we are under contract with certain of the most important highest priority, well-funded and visible systems platforms and programs and initiatives including both in national security and commercially. Since our last report to you, KTT has reached customer agreement on a potentially very large propulsion system program, which if successful, is expected to be an important overall contributor to our company including a significant financial ramp beginning in 2024 for Kratos. Also since our last report a KTT space customer, which we are under contract with successfully received the new manned lunar system program award which also could be a significant future contributor to Kratos. Related to drone engines, subcommittee recently requested the Air Force to submit a report on the schedule and plans for funding development testing and establishment of high volume manufacturing of Attritable Engine Technologies for CCAs. Kratos’ engine businesses are expected to be certain of our fastest future growers and increased margin contributors. Kratos’ rocket systems in our rocket motor, ballistic missile target, hypersonic and other system business is also well-positioned from a macro catalyst for priority and funding standpoint, including as related to the recapitalization of strategic weapon systems, the hypersonic ecosystem and strategic deterrence systems. Representative of our leadership position since our last report, Kranos’ Rocket Systems business successfully launched a new hypersonic payload for our certain customer. Additionally, Kratos’ Rocket Systems business successfully conducted the first Static Test Fires of the Kratos Zeus 1 Solid Rocket Motor at Aerojet Rocketdyne’sCam, at Arkansas. Kratos’ Zeus family of rocket motors is in direct response to the market need and demand for new affordable solid rocket motors of a particular size, class and nature for launch vehicle stages, hypersonic, ballistic missile target, research and other systems and vehicles and also for Kratos’ Erinyes and our Dark Fury hypersonic flyers. With a successful test of Kratos’ Zeus 1, and the upcoming Zeus 2 test, we are planning for Kratos’ Erinyes and Dark Fury hypersonic vehicle flights next year. Kratos’ Zeus, Erinyes and Dark Fury systems are additional examples of Kratos’ strategy of proactively working with the user and customer community, making the internal investment to move fast and be first to market, far ahead of the traditional government funded competitors with affordable relevant product systems and technology to rapidly address the customer needs. As, you know at Kratos affordability is a technology, and we believe that Kratos’ Zeus, Erinyes and Dark Fury and other Kratos systems are significantly less costly than any existing or planned future relevant systems. Missile Defense hypersonic testing targets and other vehicles are also certain of the highest priority well-funded areas in both the 2024 NDAA and the related [fight up] (ph). Kratos’ industry leading target drone business is also being driven by the recapitalization of strategic weapon systems, including radars, missiles, directed energy, counter drone and other systems, all of which need to be tested and trained against threat representative targets. Kratos is the sole source or primary high performance jet target drone provider to the United States Air Force, Navy, Army, other agencies and numerous international customers. Reflective Kratos’ industry leading target drone position. Since our last report to you, we have received a [$95 million six] (ph) single-award contract from the United States Army and both the U.S. Navy and the U.S. Air Force have indicated to us that they will in the future be procuring increased target drone quantities. We are also now awaiting a new target drone system related contract award that we have been informed, we have been successful on with our teammate and our partner. In the tactical drone area, we recently announced that Kratos and Shield AI have teamed up to rapidly integrate Shield’s artificial intelligence into Kratos’ Valkyrie. The Kratos’ Shield collaboration is another representative example of Kratos’ unique disruptive technology focused business model, which also includes working with venture backed private and commercial entities like Shield to move faster than traditional government contractors and be first to market with relevant systems. We work with a number of smaller technology and software focused companies like Shield, Peregrine Defense and others, which provide Kratos with access to unique disruptive capabilities. Also in the artificial intelligence area, yesterday, the United States Air Force announced a successful three-hour sortie demonstrating the first ever flight of artificial intelligence agents or algorithms controlling Kratos’ Valkyrie. This mission proved out a multilayer framework on an AI/ML-flown aircraft, Kratos’ Valkyrie and demonstrated the AI/ML agents solving a tactically relevant challenge problem during actual airborne operations. The flight on the Eglin test and training complex was the culmination of the previous two years of partnership that began with the Skyborg Vanguard program. AI will be a critical element of two future war fighting. It is evolving at an incredible pace, and Kratos, the Valkyrie and certain of our other tactical jet drones and other Kratos systems are leaders in relative artificial intelligence enabling areas. The Air Force announcement of AI successfully piloting Kratos’ Valkyrie is another publicly available representative milestone of the progress that Kratos’ tactical drones continue to make with the customer community. Kratos’ Valkyrie progress under the Marine’s Collaborative Killer program similarly also continues to progress. Since our last report, we have now reached agreement with a new national security related customer for payload and mission system integration into Kratos’ Valkyrie and we have recently received the contract. This is a new initiative that is highly confidential, and if Kratos and our partner are successful, this program could be a significant contributor for Kratos beginning next year. We have now also reached agreement with an additional new national security customer, and we expect to have contract documents definitized with the contract’s office by the end of the government fiscal year 2023. We also now expect to receive an additional Valkyrie related customer contract award by the end of this year, and based on the marked 2024 NDAA, we are now hopeful to receive a separate additional largest to-date Valkyrie related customer program award next year. We have government customer funded flights with Kratos’ tactical jet drones over the next several months, and I encourage you to visit the recently released Air Force Research Lab, Future of Artificial Intelligence Dominated Air Combat video to see Kratos’ Valkyrie in-flight in action. All of the Valkyries in the AFRL video are actual real drones. They’re not computer generated animation, rendition, cartoons, or simulations that certain of our competitors like to [propagate] (ph). We also have flights scheduled for later this year and next with a new customer that is potentially looking for a future purchase of Kratos Valkyrie in 2024. The Valkyrie production run continues with the most recent data indicated continuing the Valkyrie unit cost reductions as we progressed through the build and down the learning curve. I am confident based on the customer and competitive information that we have that Kratos’ cost points for high performance jet drone aircraft are significantly lower than anything existing, planned for in PowerPoints that the competition may have. Directly related to cost, a [half] (ph) sub-committee has marked the 2024 NDAA specifically stating that there will be three categories of drones and not to exceed fly away cost points. These include expendable at $3 million, Attritable, which is my favorite at $10 million and exquisite at $25 million. If this NDA mark is finalized in the 2024 budget which it is expected to be that these drone classifications and cost points will become law. As a reminder, approximate Kratos tactical drone cost points are currently Air Wolf Tactical Firejet at 500k or less, Mako at $2 million or less, Valkyrie at $6.5 million or less, which each of these drones cost expected to be much lower in quantities, and our new highly capable fully missionized system which is at $10 million. Kratos’ Ghost Works continues to work on the new system, and we are scheduling a capstone event for this system for either later this year or early next, it’s going to depend on range availability. We announced today Kratos’ newest most capable Valkyrie for the United States Marine Corps will be at the Miramar Air Show in September here in San Diego, along with several other Kratos high performance jet powered drone aircraft. These will be the actual aircraft that will be at the show. We are planning on producing approximately 150 jet drones all in the United States of America this year, including Targets, Valkyrie, Mako, Air Wolf and others, and we are now positioned to double production to approximately 300 drones annually in 18 months assuming we receive contract award and customer funding. We are ready to go now and we are clearly and routinely communicating this to the customer community. As I mentioned before, Kratos affordability is a technology and maybe better, maybe someday in the future, at some hoped for hypothetical price. That’s the enemy of good enough and ready to field now and today. We believe that Kratos’ approach is particularly relevant in the tactical drone area with the value of affordable mass and quantities having a quality all of their own is clear. Kratos to C5ISR and our microwave business are both positioned for a strong second half of 2023, with the demand for space, satellite, missile radar and other systems contributing to the demand for Kratos’ products and systems. We’ve received a large number of new program awards over the past several months and we have a record consolidated backlog and an opportunity pipeline at record. Accordingly, we are focused on internal execution, organic growth with forecasted future year-over-year revenue, EBITDA and cash flow increases with no acquisitions of size expected. Our primary operational challenge continues to be obtaining, training and retaining qualified employees, and the related high labor costs for these specialized personnel, including those that can obtain national security clearances. These and other items were included in our decision to affirm and not to increase our financial forecast with the potential contribution mix shift between KGS and KUS possible due to potential award and execution timing. In closing, Kratos’ priorities include supporting the United States National Security, the U.S. industrial base, science technology engineering map or STEM opportunities for the United States and for Kratos’ workers, developing dual commercial national security offerings like Kratos’ OpenSpace, which drives value for all Kratos’ customers, and value generation for all Kratos’ stakeholders, including the DoD, the taxpayer congress, our employees and our investors. Deanna? Deanna Lund: Thank you, Eric. Good afternoon. As we have included a detailed summary of the second quarter financial performance as well as the third quarter full-year 2023 financial guidance in the press release we published earlier today. I will focus on the highlights and my remarks today. Revenues for the second quarter were $256.9 million up from $224.2 million in the second quarter of 2022, reflecting a 14.6% increase. Revenues came in above our forecasted range of $230 million to $240 million and most of our KGS businesses, with the most notable increases in our space and satellite, turbine technologies, microwave products and C5ISR businesses. Excluding the impact of the SRE acquisition, which contributed $13.1 million in revenues in the second quarter of 2023 as compared to $4.1 million in the second quarter of 2022. Kratos’ consolidated revenues grew organically 10.7%, including a 17.1% organic revenue growth rate in our KGS segment with organic growth across all businesses within KGS. Cash flows generated from operations for the quarter of $23.6 million included cash collections resulting from favorable milestone payment terms, which accelerated receipts into the second quarter, partially offset by working capital requirement to support revenue growth and continued advanced purchase of inventory in an effort to mitigate potential supply chain disruptions and delays. Also included in our working capital uses are continued internal investments of approximately $3 million related to nonrecurring engineering costs to complete new rocket systems and hypersonic and related products, including for Kratos’ Zeus, Erinyes, and Dark Fury Systems and continued development of certain software products supporting our OpenSpace platform. Free cash flow generated from operations was $28.7 million after funding capital expenditures of $11.2 million and receipt of $8.3 million of proceeds for Valkyrie’s that were built as capital assets prior to contract award. Our contract mix for the second quarter of 2023 was 67% fixed price, 27% cost plus and 6% time and material. Revenues generated from contracts with the U.S. federal government during the quarter were approximately 69% including revenues generated from contracts with the DoD, non-DoD Federal Government Agencies and FMS contracts. In the second quarter of 2023 we generated 11% of revenues from commercial customers and 20% from foreign customers. We continue to make progress in our hiring and retention of skilled technical labor, including in our C5ISR business, with a notable net increase in C5ISR headcount of 37 since the end of last year, including 18 in the second quarter plus an additional 12 recently clearing the pre-hire process. Kratos’ overall total increase in consolidated headcount this year is 152 from 3,645 at year end 2022 to 3797 at the end of the second quarter. Moving on to financial guidance. Our third quarter and a firm full year 2023 financial guidance we provided today includes our current forecast business mix and our assumptions related to the expected impact of our continued operating challenge related to obtaining and retaining qualified technical personnel, as well as the lingering impact of supply chain disruptions, inflation, and related expected costs and price increases that are currently and expected to continue impacting both the industry and Kratos. Our revenue guidance range for the third quarter of 2023 reflects an approximate 5% to 13% organic increase over the third quarter of 2022. Based on the current budgetary environment, we are expecting to be in a continuing resolution for the fourth quarter which is reflected in our affirmation of our full year revenue guidance. Based upon funding, production, delivery and execution schedules, our third quarter 2023 revenues are expected to be fairly consistent with the second quarter based upon current production and delivery schedules. We expect margins to expand in the fourth quarter based upon the expected mix of revenues including new fixed price contracts, which include more recent cost estimates and more software based content. Estimated incremental ramps in production in the second half of 2023 are expected to be driven by a handful of key programs in our space, satellite and training, C5ISR and unmanned systems businesses. Operating cash flows are expected to be stronger in the fourth quarter, driven by the expected expansion in margins and the expected conversion of inventory builds from FY 2022 and the first half of 2023 and based upon estimated milestone payment schedules. Eric? Eric DeMarco: Thank you, Deanna. We’ll turn it back over to the moderator for any questions. Q&A Session Follow Kratos Defense & Security Solutions Inc. (NASDAQ:KTOS) Follow Kratos Defense & Security Solutions Inc. (NASDAQ:KTOS) We may use your email to send marketing emails about our services. Click here to read our privacy policy. Operator: Thank you. [Operator Instructions]. Our first question comes from Joe Gomes with Noble Capital. Your line is open. Unidentified Analyst: Hi. Good afternoon. This is [Josh Fazilple] (ph) filling in for Joe Gomes. He’s just on another call. I wanted to start off the congratulations on the quarter, you guys. It seemed like hitting nail on the head and even more so with the growth. So, I just wanted to start off just actually just kind of going into the growth rate as well. Obviously, you guys thought it’d like right around like, 3% or 7% increase over the last quarter and obviously came in at really 15%. So like, what was kind of like, obviously, the big impact behind that large growth? Deanna Lund: Yes. So it was organic growth literally in every business unit within KGS across the board. Space satellite training, C5ISR, microwave products, turbine technologies, air and defense rocket, all across the board. Unidentified Analyst: Perfect. And so I just wanted to see, you guys mentioned last quarter that you guys had, enduring shield was going into kind of LRIP in the back half of 2023, when do you guys expect that, again, more towards the third and more towards the fourth? Eric DeMarco: Yeah. As you know, we’re partnered with Dynetics on this and they’re the prime. We’re building the ground infrastructure for [indiscernible] and enduring freedom. I would speak with them. Things are consistent with where we were previously. There have been no changes. We expect to begin sometime in the second half of this year, but I just — I don’t want to get ahead of the prime. There’s nothing wrong here. I just don’t want to — I have respect for the chain of command. So just circle up with Leidos Dynetics on that for the specific please. Unidentified Analyst: Okay. That’d be fine. And then, just lastly, you guys sounded like you guys are really hiring a good amount of people. It seems like well over a 100, at least. So, is the market been just favorable towards that for you guys as well like, it has some retention for those employees been extremely positive. Eric DeMarco: It’s the market for the type of employee we’re looking for continues to improve over the past several months. It is still difficult on a cost standpoint. It’s very costly, especially for individuals that want to and will obtain and retain a security clearance. So it’s getting better it’s one of the reasons we’re feeling better about the business in the second half of this year and 2024. But it’s still expensive for people with very specialized capabilities. So that’s the nature of it right now. And yes, we have a lot of openings. If we could fill all the openings we have based on our existing backlog and not just the backlog, the programs we have where we’re going to get options exercised and it’s not in the backlog yet. And we’re going to win some big opportunities. As I mentioned, we’ve been told we’ve won some and they’re going to be coming out soon. We are growth rate organically, which we’re laser focused on could be substantially higher. It really could be, but we just can’t — we can’t get the people right now in the industry. Unidentified Analyst: Okay. And I’ll jump back in the queue, but once again, great quarter guys. Eric DeMarco: Thank you. Deanna Lund: Thank you. Operator: One moment for our next question. We have a question from Pete Osterland with Truist Securities. Your line is open. Peter Osterland: Hey, good evening. I’m on for Mike Ciarmoli tonight. Thanks for taking the question. First, I just wanted to ask, given that you maintained full year outlook after putting up a pretty strong quarter. Was there any pull forward in demand versus what you originally expected or any maybe unexpected easing in the supply chain. Just what drove the outperformance versus what you originally expected, 2Q to look like? Eric DeMarco: Yes, it’s not really the supply chain. The supply chain is as expected and it continues to be challenging, right? Maybe a couple things move forward a little bit, a couple, but the team is executing very, very well. And as I tried to allude to in my prepared remarks, the fact that Q2 came in better than we had hoped, it gives us higher confidence in the full-year, but frankly it takes some pressure off of the year. Right now, obviously, you guys, if you do the math, at least on the revenue side, Deanna talked our mix is getting better and better why margins are going to be up. We continue to do $250 million quarters Q3, Q4, we’re going to drill our guidance. So there’s no ramp. There’s no hockey stick. And as Deanna mentioned, as we all know, we’re probably going to have a continuing resolution. We expected that, but what I’m starting to worry about is, is it going to be worse than a continuing resolution, will the government shut down for a period of time? And so we’re factoring all those things in where we just don’t want to get ahead of ourselves. We have a lot of good things going on here across the company. We want to deliver on what we say. That’s where our heads at. Peter Osterland: Great. That’s very helpful. And then, there’s a follow-up, just as we think about the opportunities internationally for target drones, have you seen any signs of increased momentum for demand on that front? Either from orders or conversations with potential customers? And just how are you thinking about the growth trajectory for that business over the next couple of years? Eric DeMarco: Yes. International target drone business is continuing to ramp. It’s going to continue to ramp. However, as I think I mentioned on the previous call or two, the big three target drone users in the world are the United States Navy, the United States Air Force and the United States Army. Obviously, we have all of them. Then there’s the UK Ministry of Defense. That’s our customer too. And then just looking at defense budgets globally, target drone by country drops off precipitously after that. So we’re going to book and we’re going to be able to announce a lot of international target drone wins over the next several months and quarters. But the quantities are nice, but they’re not the big needle movers like the U.S. stuff. They’re just not. The award that I mentioned in my prepared remarks that we’ve been informed we’ve won and hopefully it’s going to be definitized in the next few weeks. That can be a needle mover in 2024 or 2025. And I can’t say much more about it. But that’s a good one. Peter Osterland: Great. Thanks for taking the questions. Eric DeMarco: Yes. Operator: We have a question coming from Mike Crawford from B. Riley Securities. Your line is open. Mike Crawford: Thank you. Eric, you talked about a new payload and mission integration system customer potentially for Valkyrie. And I know you have a number of customers within the DoD, maybe ministry and defense, but would you be able to supply Valkyrie say to, another prime? Eric DeMarco: Yes. We would be able to provide the Valkyrie to another U.S. prime. There is no prohibition on us doing something like that if the opportunity arose. Mike Crawford: And is that something you would consider to be beneficial given maybe their channels? Eric DeMarco: Yes, we would definitely consider it. We’re going to do what’s right for the business and what’s right for the shareholder. I, model — we have multiple models here at Kratos. One of them, it’s better to have part of something than all of nothing. And if we could get a big part of something doing something like you’re talking about, instead of taking a high risk and going out alone, we’d weigh those factors and we’d make the decision. So, the answer is yes. Mike Crawford: Okay. Thank you. And then you talked about a plan and Steve Finley was actually quoted about this and even further to double production of drones from the 150 target and tactical aircraft this year to 300 within 18 months. And I know that you have space to do that given the Oklahoma facility where I think you’re on your second Valkyrie production path right now. But what will this require from a human capital standpoint in terms of increased number of employees to execute on that plan? Eric DeMarco: Right. So, Mike, related to that, and I did not say this in my remarks, we have acquired an additional autoclave specifically for tactical drones. Our team got an incredible financial deal on it and we’ve got it and it’s going in. On the people side, that is something we’re always focusing on. Thinking additional for what you’d what you just framed up and what Steve said. And I know what you’re talking about. Think another approximate 125 people. Mike Crawford: Okay. Thank you. And then I have one final question. So your solid rocket motor partner Aerojet Rocketdyne is now part of L3Harris and what if any concessions or assurances do you have or not have from L3 regarding your ability to continue to get ready access to a merchant supplier of solid rocket motors for some of your vehicles. Eric DeMarco: Right. So, I’m obviously I can’t talk about any direct communications that we may or may not have had with anybody you are talking about. However, L3Harris executive leadership immediately upon the close pledged. This is public. They made a pledge that they’re going to invest in the business They’re going to be a merchant supplier and someone sent me a letter where they communicated to the Department of Defense that they are not going to play any favorites and they are going to continue to treat us all as equal partners. So, that’s what my friends at L3Harris have said publicly. To the other part of your question. We of course are very prudent when we’re always looking for second sources or backup plans. And that’s across the company and across the business and we’ll continue to do that including now in the rocket motor area. Mike Crawford: Okay. thank you, Eric. Thanks a lot. Eric DeMarco: You’re welcome. Operator: Thank you. We also have a question from Ken Herbert with RBC Capital Markets. Your line is open. Ken Herbert: Hey, Eric. Good afternoon. Eric DeMarco: Hey Ken. Good afternoon. Ken Herbert: Hey, I wanted to start off, congratulations on the AI Valkyrie flight. Coming out of that fight, the Air Force specifically commented that they see direct transferability or applications of this flight and the technology to the CCA program. Can you provide any more color on how you see Kratos’ involvement in the CCA program playing out. Any maybe milestones, incremental milestones, we should be we should be thinking about. And specifically, how you see the technology sort of risk initially as you look to transfer this into or the Air Force looks to transfer this into CCA amongst other areas, in the in the future. Eric DeMarco: Ken, I apologize. I cannot say anything at all about that program. I’m sorry. I can’t do it. Ken Herbert: Okay. Fair enough. Can you provide any comments on the test flight and maybe any of lessons learned in particular or how it completed the flight relative to initial expectations? Eric DeMarco: From my perspective, from our perspective, the Valkyrie absolutely knocked it out of the park over the three hour flight. And our customers continue to applaud the Valkyrie, they applaud the aircraft. Ken I mention the video, the Air Force Research Lab Video. If you may have had a chance to take a look at it. For those of you that haven’t, I encourage you again to please go take a look at it. It will address and answer a lot of the questions it’s by the government, by the air force that Ken is asking that I’m not just not comfortable talking about publicly. Ken, we continue to make incredible progress in the tactical drone area. As I said about a year ago, I thought everything was going to become more classified and I was going to not be able to talk much anymore and that’s where we are. Which is why I’m now wherever I can pointing to or identifying what the government is saying. They’re not endorsing, but what they’re saying to try to keep the investors as up to date as possible. So we’re with the U.S. Marine Corps, we’re doing great. I know it’s out there. I saw a public thing out there now. We’re involved with the Office of the Secretary of Defense. That’s moving forward. Obviously, with the Air Force and multiple areas, we feel the government moves on their own timeline. We will not get ahead of ourselves, but we have a whole family of airplanes flying today. And I mentioned the cost points. I mentioned new stuff. We’re ahead of everybody. And our plan is to stay ahead of everybody. A very important person said to me in the past couple of weeks, you need to have strategic patients. For those of you who know me, you know that’s very difficult, but I’m happy to have strategic patients. And we will win. Ken Herbert: Okay. Perfect. Appreciate that. And if I could maybe just one for Deanna. In the second quarter, it looks like working capital, specifically accounts receivable, was a really nice source of cash. The guidance implies nice inflection in the second half of the year in terms of cash generation. Are there — was there anything sort of one-time in the quarter you call out around working capital that was a nice tailwind and how do we think about maybe the upside for the full-year expectations from a cash standpoint. Deanna Lund: Sure. There were some favorable milestones in the second quarter that did accelerate some receipt that we had originally anticipated in the third quarter. So that was favorable in the second quarter. In my prepared remarks, I highlighted Q4 where we expect to, working capital to be beneficial as well in the fourth quarter as based on scheduled milestone payments as well as our expected conversion of some of the inventory builds that we’ve been building throughout 2022 and thus far through 2023. Ken Herbert: Perfect. Thank you very much. Deanna Lund: Thank you. Eric DeMarco: You’re welcome. Operator: Thank you. We have a question coming from Seth Seifman with JPMorgan. Your line is open. Seth Seifman: Thanks very much. Good afternoon. And congratulations, again, on the latest Valkyrie flight, at the risk of asking a question about something that’s difficult to talk about. Just following up on that, maybe hopefully this is high level enough that is something you can talk about. When we think about the path forward, with Valkyrie and things that need to be developed in order to see demand really ramp up I assume that some of it is the artificial intelligence capability, being developed kind of outside the company. When you think about the pace of that and how that happens and how that development path relates to the demand profile for Valkyrie. How do those two things kind of link together and where are we in that now? Eric DeMarco: Right. So, Seth, right now, the Valkyrie as a minimal as a low cost affordable minimal viable product is ready to go. It’s ready to go in four certain missions, which is why on the last few calls, including today, I continue to call out. Payloads are being integrated, flights are happening, tactically operationally relevant flights are happening, etcetera. That minimal viable product and minimal is very substantive. I’m sure it’s better than anything than any of our adversaries have. It’s ready to go and I’m noodling on the artificial intelligence with a very robust and proven augmented autonomy system. If you remember, we first flew manned unmanned teaming in 2015. And that that video, you can see a man, harrier, man’s fighters sending Makos out, deploying things, coming back, etcetera, etcetera. So we’ve been evolving a robust augmented autonomy system for a number of years. What the Air Force has announced here, what we’re doing with SHIELD, etcetera, this is much more sophisticated. This is the artificial intelligence piece. So, with those two data points out there, I believe and this is my opinion, we are ready to go with virtually every one of our tactical drones except the newest one. With augmented autonomy systems, we’ve deployed payloads. We’ve deployed weapons. We’ve deployed tactical drones, etcetera. Things are evolving very, very quickly. And I don’t — I will not speak for any of our customers, but by the announcement the Air Force put out yesterday, some other things that are going to be coming out soon, artificial intelligence is moving ahead rapidly. I’m not sure where the customer will step in and say good enough ready to go, could be tomorrow, could be in a month, could be in a year. I don’t know, but that’s the evolving game field we’re in. Does that help? Seth Seifman: Yes, absolutely. Thanks. And then, obviously, another key milestone, we saw it in the quarter. Was the, the Zeus, the static test flight. It seems, I guess, can you take us through kind of where things go from here and how you see the hypersonics opportunities playing out? I mean, it seems like if we think back several years ago in terms of where hypersonics was supposed to be big picture for DoD. It seems like, maybe some of that hasn’t panned out and maybe some of that because costs are high. And so, this is something that’s moving in a different direction. But when you think about gaining further acceptance of this with the customer and what future milestones are? Kind of how do you think about that? Eric DeMarco: So, as I mentioned, I obviously can’t get into any detail since our last call, Kratos had a very successful hypersonic launch of a government customer’s vehicle, very successful. Things at least relevant to Kratos in the hypersonic area are moving very, very quickly and it’s happening right now. And I believe it’s because of our affordability, our low cost, which we’ve demonstrated with low cost ballistic missile targets, which as we all know, ballistic missiles go hypersonic speeds when they re-enter. It’s the maneuverability, which we’ve done before. I think low cost is going to win because the customer community wants to test fail, test fail, test to get it right. Instead of do a test, wait three years to figure out what happened and then test again. You can’t do that philosophy if they’re real expensive. The test fail, test fail, we’re very low cost, which is one of the reasons why, Seth, I believe we were successful with our partner on winning the MACH-TB program, the MACH-TB Test Bed program. It’s a hypersonic Test Bed program. I can’t get into many details. But I anticipate this starting next year is going to be one of our biggest growth drivers. And Zeus I and Zeus II in my opinion are primary reasons why we won in addition to Erinyes, Erinyes don’t quote me on this, but it’s orders of magnitude. It’s like one eighth of the cost of what anybody else has. And we’re going to fly first and Dark Fury is coming after it. And Dark Fury is incredibly capable. And so we’re taking the approach here very similar to what we did with the tactical drones. We took proven existing technology the target rooms and we modified it, adapted it and converted it to tactical. So, we’re taking our ballistic missile target capabilities. Our ballistic missile motor, Oriole, the Terrier I, the Terrier II, the ARAV. We’re using those. We specifically have designed Aerojet is, of course, is building it for us, but we own it on Zeus I and Zeus II. And with the flyers, we’re going to be, as far as I know, one of the only companies, I think there might be one other that has the stack and the front ends in the world. And, Seth you reminded me of something on that. Next year, we’re going to start putting our engines in certain of our target drones. So we are now starting to vertically integrate in the drone area with our own engine. And the engine is about a third of the cost of the bill of materials. We’re not going to have to pay the gross margin to somebody. So that’s going to — we’re going to be one of the only companies in the world, if not the only one that builds the aircraft and the engine. And also related to that, we’ve stood up, we’re standing up an organization for casting, milling, machining, and 3D printing, the components for our engines. So we’re not going to have to go outside and be held up by supply chain anymore. That’s going to be up and rolling next year too. So, I know that’s a long answer, but that kind of ties into the vertical integration question you were asking and that’s our vision. Seth Seifman: Great. Thanks very much. Eric DeMarco: Thank you. Operator: Thank you. We have a question from Sheila Kahyaoglu with Jefferies. Your line is open. Sheila Kahyaoglu: Thank you. Good afternoon, Eric and Deanna. Eric, first off, Happy birthday. Eric DeMarco: Thank you. Sheila Kahyaoglu: So I have a few questions for you. So, on the budget, you mentioned a few things you’re looking for on the unmanned side. What would be two things we should look for in the fiscal 2024 budget when it comes to Kratos? Eric DeMarco: I want to name some things that I think you can see. You want to definitely take a look at target drones target drum. So, look at PEO 208 Program Executive Office 208 on the United States Navy on their target drones. And so this is unmanned, unmanned aerial systems in strike where target drones are. They’re also going to be doing some other things in there. We are heavily involved than that line. Take a look at the target drone line of the United States Air Force. You heard me mention in my prepared remarks that a lot’s going on in the world. And so a lot more target drones are going to be needed. So I would take a look at the target drone areas. That, you’ll be able to see and you’ll be up, I think in the narrative under the program element lines, you’ll be able to see narrative that’s specifically related to Kratos. I think you’ll be able to see under the United States Marine Corps, I think, it’ll be narrative that’ll call out attritable aircraft, attritable unmanned aircraft, expeditionary aircraft, that’s one to look for too relative to what we’re doing with the United States Marine Corp. Sheila Kahyaoglu: Thank you for that. And then my second question for you is on KGS great quarter, grew 17% organically. You called out basically every business area. And you even mentioned, like, if you had the labor there, you’d be hires. So, obviously, the budget is not growing 17%. Are you taking share? What are some of the key areas where contributed to that growth? Eric DeMarco: Yes. So let me handle the programmatic part and then Deanna will handle the numbers. We absolutely are taking share. And there are there are two guys in particular we’re taking it from. And that’s been our plan where they — traditional people and legacy people are very hesitant to do anything innovative and come out with any new products because they don’t want to cannibalize what they have existing. They don’t want to cannibalize it. So they’re disincentivized to come up with virtualized software command and control telemetry, tracking and control, modems, etcetera, for space communications. They’re just not incentivized to do it, because they cannibalize. Well, it takes a disruption like, software defined satellites, high definition satellites, high throughput satellites, etcetera that needs a whole new generation of ground equipment to give a guy like us an opportunity And so we are definitely taking share and we intend on continuing to do that. Sheila Kahyaoglu: Okay. And maybe one last one, unless Diana’s going to comment on the numbers. Five years from now, how do you think about the fighter programs, whether it’s [indiscernible]? Eric DeMarco: Shiela, right after you went through the different platforms. You went — the phone went silent and then you came back on. So if you could crisply again, I’m sorry, just what was the question? Sheila Kahyaoglu: Sorry about that. No, just five years from now, how you think about like the biggest fighter program contribution to Kratos? I know you couldn’t answer Ken’s question, so I’m asking it slightly differently. Eric DeMarco: I’m going to be very aloof on that and I’m going to answer it this way. We are seeing in the Ukraine that quantities matter, especially when it comes to drones. Hundreds if not thousands of drones are going to be used. Now people are saying, all those are propeller planes. And yes, I get that because it’s a land war. But in the Pacific, take a look at the recent Rand report that came out last week. In the Rand report, specifically laid out that to deter and defend Taiwan against somebody, the best way to do it is to use hundred if not thousands of high performance jet drones to give the bad guy a hell of a targeting problem. They have to respect them all and they’re an incredible threat. So, you flip the cost curve on them where they have to fire something more expensive at you than the drone. I also encourage people three star General [Heino] (ph) just retired three weeks ago. Go take a look at his most recent interviews regarding what he sees the drones are going to be needed in the next three to five years for the Pacific. And so with that as the backdrop, Sheila, I believe that the most important from an aircraft standpoint for Kratos is going to be our tactical jet drones. Specifically, in the expendable and the attritable areas. And we intend to be one of the leaders there. Sheila Kahyaoglu: Great. Thank you. Operator: And it looks like our last question comes from Jan-Frans Engelbrecht with Baird. Your line is open. Jan-Frans Engelbrecht: Good afternoon, Eric, Deanna and Marie. Congrats on a good quarter. I’m on for Peter today. Just like to talk. Good afternoon. So you mentioned in the release, your bid and proposal pipeline of $10 billion. Can you just talk more about the potential for new space awards and maybe a little bit of information about the adoption of OpenSpace that’s going with customers. Eric DeMarco: Right. If you could see me, first time I’m smiling. Our OpenSpace team is incredible. The technical team, the sales team, the business development team, it’s really incredible. And we have put a tool in their toolbox or an arrow in their quiver with this first to market, software, command and control, TT&C modem system, etcetera, that is the exact right answer at the exact right time for the type of satellites that are going up today. We are in my opinion, we are three or four years ahead of the competition for some of the reasons I said before. We have extreme high expectations that are being proven out for our satellite and space business. It’s our biggest business and it’s going to be our — I believe it’s going to be our fastest growing with incredible margin expansion that we’re starting to see. It’s going to really take off next year than in 2025 as the software license model under OpenSpace kicks in. And the vendor lock comment that I made in my prepared remarks, the satellite operators do not want to be vendor locked to the guys that are building the satellites anymore where they’re tied into the ground equipment forever. They don’t want that. And so we are the independent merchant supplier of the ground equipment that can interface with the LEOs, MEOs and GEOs. And it’s — we might have a tiger by the tail here. And I encourage you all if you haven’t, go to Intelsat’s website. They’ve actually put a video on their website, of what Kratos’ OpenSpace is, what it’s doing for them, how it’s differentiating for them. And that’ll give you an idea of why you hear a giddy up in my step relevant to this. So, we’re feeling very good and a big part of that pipeline an important an important part of that pipeline is space and satellite communications with OpenSpace content. Jan-Frans Engelbrecht: Perfect. Thank you. Thanks for the detail. And if I could just have a quick follow-up sir. So there’s been some questions about, in Valkyrie and the ability to scale production. But if we could just return to your comments on the doubling of production and I know we have to assume funding comes in if you want to move from 150 to 300 jet rounds, but can you just touch sort of an Air Wolf maker and Valkyrie, sort of the lead times that you would experience to sort of ramp production, are they — the difference between that? Eric DeMarco: Yes. On the Valkyrie right now, it’s 12 to 15 months and it’s because of the engine. And I’m working on fixing that. And I’m not going to get into too many details on that, but that’s the big lead time on the Valkyrie. The engine is the long lead time on all of them, but the longest one is the Valkyrie. The other one I’m going to say are within six months. But that is the long pole in the tent. It’s the engine, which obviously ties right into Kratos’ engine strategy and why we have engine businesses and why I’m so optimistic about how good our engine businesses are going to do over the next few years because there has been — we were fighting terrorists for 20 or 25 years and range and power. And when I say power, it’s not thrust. It’s electrical power to work all the systems on the drones of the power [diminishes] (ph) wasn’t important. Now it’s range is important. Power is important. New engines are important and those engines are going to go in the drones. That’s the plan. Jan-Frans Engelbrecht: Thank you. I appreciate it. I’ll jump back in the queue. Operator: Thank you. And I’m showing no other questions at this time. I’d like to turn the call back to Eric DeMarco for closing comments. Eric DeMarco: Great. Thank you everyone for joining us. If you have any follow ups other than what we went through, please don’t hesitate to shoot Deanna or I a note. And we’ll plan on chatting with you when we report Q3. Operator: This concludes today’s conference call. Thank you for participating. You may now disconnect. Follow Kratos Defense & Security Solutions Inc. (NASDAQ:KTOS) Follow Kratos Defense & Security Solutions Inc. (NASDAQ:KTOS) We may use your email to send marketing emails about our services. Click here to read our privacy policy......»»

In this article, we will take a look at the 10 stocks that will make you rich in 2023. To see more such companies, go directly to 5 Stocks That Will Make You Rich in 2023. To make money by investing in the stock market, one ought to follow time-tested investing principles with patience. But […] In this article, we will take a look at the 10 stocks that will make you rich in 2023. To see more such companies, go directly to 5 Stocks That Will Make You Rich in 2023. To make money by investing in the stock market, one ought to follow time-tested investing principles with patience. But sometimes the market creates opportunities that have the potential to reward investors who are ready to ride the bandwagon of time. Artificial intelligence is the ultimate money-making bandwagon of 2023 and perhaps several years to come. While many believe AI is quickly becoming a hype and pushing stocks’ valuation to dangerous levels, there are credible analysts who still believe tech stocks have a long way to go in this AI revolution. The AI Gold Rush Wedbush’s Dan Ives recently said that the AI “gold rush” would be driving tech stocks higher in the second half of 2023. “The 2nd, 3rd, and 4th derivatives of this A.I. Gold Rush are just starting to evolve for the tech landscape. As we have covered the tech sector for decades and saw the dot.com bubble and burst firsthand, [we believe] this is the start of a 4th Industrial Revolution playing out across tech over the coming years that is still being underestimated by the Street in our opinion,” Ives said during an interview with CNBC. Not all bubbles are bad. Some bubbles have the potential to make investors rich and give them evergreen gains and long-term opportunities. SkyBridge Capital Founder Anthony Scaramucci, while talking to BNN Bloomberg, said that while AI is “probably in a bubble,” there are still some AI stocks that should be in investors’ portfolio. Anthony Scaramucci specifically talked about Nvidia, a stock many analysts believe has become overvalued amid its latest AI-driven performance. Scaramucci said that Nvidia may be overvalued currently “but if you own it for the next 15 years, you’ll probably be OK.” One of the biggest reasons why AI stocks have the potential to gain further is the explosive potential and applications of generative AI. According to Bloomberg Intelligence, the generative AI market could expand by about 40%, to $1.3 trillion by 2032. The AI Bubble and How to Make the Most of It Billionaire investor George Soros’ thoughts on bubbles are interesting and have become highly relevant in the current backdrop. Soros in 2009 famously said: “When I see a bubble forming, I rush to buy, adding fuel to the fire.” In a detailed lecture in 2009, Soros explained his bubble theory. Soros thinks that a boom-bust cycle is set in motion when a trend and a misconception positively reinforce each other. Positive reinforcements keep inflating the bubble through positive feedbacks. This bubble is tested by market dynamics from time to time but if the trend is strong enough, it survives this test, according to Soros. This cycle enters what Soros calls the “twilight” stage when the trend begins to lose stream but nonetheless maintains inertia before eventually beginning to decline. At what stage the current AI boom is? No one can say for sure but an overwhelming majority of market analysts believe the AI revolution is just getting started. To make money from this revolution, analysts recommend some stocks that are expected to ride the AI wave. Our Methodology In this article, we picked stocks that are expected to keep gaining value based on the AI hype and AI-related growth catalysts in 2023 and beyond, according to analysts. Disclaimer: The stocks discussed in the article were selected using a consensus opinion-based approach, using credible analyst reports, websites and price estimates. However, there is no guarantee that these stocks will appreciate in value in future. The purpose of this article is news and education based on research. Stocks That Will Make You Rich in 2023 10. SoftBank Group Corp. (OTC:SFTBY) Number of Hedge Fund Holders: N/A Japanese investment giant SoftBank Group Corp. (OTC:SFTBY) has not been much impressive over the past few years. Its Vision Fund has posted huge losses and its China investments have been painfully unprofitable. But SoftBank Group Corp. (OTC:SFTBY)’s chief Masayoshi Son recently announced the company is ready to shift to “offense mode” and benefit from the AI revolution. “What I am interested in most, what I am working on most, is the AI revolution. I believe that mankind is going to be exceeded by computer or AI. We would like to be [in] the leading position for the AI revolution,” Son reportedly said. SoftBank Group Corp. (OTC:SFTBY) is preparing to publicly list British semiconductor company ARM later this year. Analysts believe the move could give Softbank a huge AI-related boost. Jefferies analyst Atul Goyal upgraded SoftBank Group Corp. (OTC:SFTBY) shares to Buy and said: “We expressed a view that SBG stock will rally ahead of the ARM IPO later in the year… But given (the) market’s fascination for semi-stocks, we think it makes sense to move early.” 9. Palantir Technologies Inc. (NYSE:PLTR) Number of Hedge Fund Holders: 31 Palantir Technologies Inc. (NYSE:PLTR) is going ballistic over AI and made headlines earlier this year by launching AIP, its AI platform for defense and military. Palantir Technologies Inc. (NYSE:PLTR) could become the go-to solutions provider for all things AI for defense and military applications. Palantir Technologies Inc. (NYSE:PLTR) has gained about 140% year to date through July 7. Dan Ives counted Palantir Technologies Inc. (NYSE:PLTR) among the top companies he believes could gain from the AI market which he thinks could reach $800 billion over the next 10 years. As of the end of the first quarter of 2023, 31 hedge funds tracked by Insider Monkey had stakes in Palantir Technologies Inc. (NYSE:PLTR). 8. CrowdStrike Holdings, Inc. (NASDAQ:CRWD) Number of Hedge Fund Holders: 72 Some analysts believe Texas-based CrowdStrike Holdings, Inc. (NASDAQ:CRWD) could make investors rich in 2023 and beyond as the software company’s products are seeing huge demand. Recently, BTIG Research added CrowdStrike Holdings, Inc. (NASDAQ:CRWD) in its list of top picks for the rest of 2023. BTIG is bullish on CrowdStrike Holdings, Inc. (NASDAQ:CRWD) amid its dominance in the endpoint security/EDR market, high win rates against rivals like Microsoft, strong customer recognition, and successful performance in emerging product categories. Morgan Stanley analysts recently said that AI has created a new opportunity in the cybersecurity domain. They believe AI-led automation in the industry could create $30 billion in productivity gains and much of those could go to a few companies including CrowdStrike Holdings, Inc. (NASDAQ:CRWD), Palo Alto Networks Inc. (NYSE:PANW) and Microsoft Corporation (NASDAQ:MSFT). Artisan Developing World Fund made the following comment about CrowdStrike Holdings, Inc. (NASDAQ:CRWD) in its Q1 2023 investor letter: “Top contributors to performance for the quarter included graphics semiconductor company Nvidia, Southeast Asian e-commerce platform Sea, Latin American marketplace MercadoLibre, online travel marketplace Airbnb, and endpoint security company CrowdStrike Holdings, Inc. (NASDAQ:CRWD). CrowdStrike rebounded as its financial results eased demand-related concerns in its core endpoint business, while adoption in platform adjacencies continued to rise.” 7. Tesla Inc. (NASDAQ:TSLA) Number of Hedge Fund Holders: 82 Being a leader and first mover in the lucrative EV industry gives Tesla Inc. (NASDAQ:TSLA) an advantage that it keeps enjoying, thanks to Elon Musk’s relentless innovation and proactive approach. Tesla Inc. (NASDAQ:TSLA) has already gained about 155% year to date through July 7. Tesla Inc. (NASDAQ:TSLA) is gaining after the company posted Q2 delivery numbers. Tesla Inc. (NASDAQ:TSLA) delivered 466,140 electric vehicles in the second quarter of 2023, surpassing estimates of 445,000 units.  This was an 83% year-over-year growth. Wedbush Securities analyst Dan Ives said Tesla Inc. (NASDAQ:TSLA)’s price cuts earlier this year gave the company an advantage as demand of EVs remain strong.  Ives thinks Tesla Inc. (NASDAQ:TSLA) is on track to hit 1.8 million unit delivery milestone for 2023. “With this delivery beat, we believe the sum-of-the-parts story for Tesla is another step towards coming into play with its newly released supercharger network OEM deals, energy business, AI driven autonomous path, unmatched battery ecosystem, and increased production scale/scope globally adding to the Tesla golden EV success story,” Ives said. Ives has a $300 price target on Tesla Inc. (NASDAQ:TSLA). Cathie Wood of ARK, which has a $1.13 billion stake in Tesla Inc. (NASDAQ:TSLA), thinks Tesla shares could reach $3000 by 2025. 6. Palo Alto Networks Inc. (NYSE:PANW) Number of Hedge Fund Holders: 87 Palo Alto Networks Inc. (NYSE:PANW) is another stock that analysts believe can ride the AI bandwagon. Goldman Sachs recently released its “Rule of 10” screen picks which include companies that have showed strong sales growth over the past couple of years and are expected to continue posting solid revenue growth. Palo Alto Networks Inc. (NYSE:PANW) made it to the list. Palo Alto Networks Inc. (NYSE:PANW) is uniquely positioned to benefit from the AI boom. The company launched its platform XSIAM that uses automation and AI for information and cybersecurity. Palo Alto Networks Inc. (NYSE:PANW)’s CEO has a special focus on AI and the company is expected to see more growth based on its AI products. He said during fiscal Q3 earnings call in May: “I think there is no doubt we will continue to deploy our proprietary AI models for XSIAM or for our network security use case as I highlighted. We believe in our preliminary analysis over the last three months and driving a lot of these work streams internally that there is a dare there with generative AI. So we believe that we will be deploying generative AI over the course of the next few months, and we’ll talk more about it At a later event. But we think that has an opportunity both to significantly improve our customer efficiency and the efficacy of our products, at the same time, also to drive efficiencies within the way we run Palo Alto Networks. I think last but not the least, which is something you didn’t ask, but I’ll say, separately, Lee and his team have been working hard to see and look at the adverse impact that generative AI could have in terms of adversaries using Generative AI to build new malware, to try and attack our customers.” TimesSquare U.S. Mid Cap Growth Strategy made the following comment about Palo Alto Networks, Inc. (NASDAQ:PANW) in its Q4 2022 investor letter: “Within Information Technology, Palo Alto Networks, Inc. (NASDAQ:PANW) offers network security solutions to enterprises, services providers, and government entities. The company delivered another strong quarter with revenues, billings, and earnings all above the consensus. Management recognizes a challenging macro environment that is altering customer behavior such as increased deal scrutiny and elongating sales cycles. Their shares pulled back by -15% during the quarter.”   Click to continue reading and see 5 Stocks That Will Make You Rich in 2023.   Suggested articles: 16 Most Adulterous Countries in the World 20 Countries with the Best Economy in the World 15 Most Popular States to Retire to in the U.S. Disclosure: None. 10 Stocks That Will Make You Rich in 2023 is originally published on Insider Monkey......»»

W. R. Berkley Corporation (NYSE:WRB) Q2 2023 Earnings Call Transcript July 20, 2023 W. R. Berkley Corporation beats earnings expectations. Reported EPS is $1.14, expectations were $1.1. Operator: Good day and welcome to W. R. Berkley Corporation’s Second Quarter 2023 Earnings Conference Call. Today’s conference call is being recorded. The speakers’ remarks may contain forward-looking […] W. R. Berkley Corporation (NYSE:WRB) Q2 2023 Earnings Call Transcript July 20, 2023 W. R. Berkley Corporation beats earnings expectations. Reported EPS is $1.14, expectations were $1.1. Operator: Good day and welcome to W. R. Berkley Corporation’s Second Quarter 2023 Earnings Conference Call. Today’s conference call is being recorded. The speakers’ remarks may contain forward-looking statements. Some of the forward-looking statements can be identified by the use of forward-looking words, including, without limitation, beliefs, expects or estimates. We caution you that such forward-looking statements should not be regarded as representation by us that the future plans, estimates or expectations contemplated by us will, in fact, be achieved. Please refer to our annual report on Form 10-K for the year ended December 31, 2022 and our other filings made with the SEC for a description of the business environment in which we operate and the important factors that may materially affect our results. W. R. Berkley Corporation is not under any obligation and expressly disclaims any such obligation to update or alter its forward-looking statements, whether as a result of the new information, future events or otherwise. I would now like to turn the call over to Mr. Rob Berkley. Please go ahead, sir. Robert Berkley: Breanna, thank you very much and good afternoon, all. And again, welcome to our second quarter call. Along with me on this end of the phone, we also have our Executive Chairman, Bill Berkley, as well as Chief Financial Officer, Rich Baio. And we’re going to follow our typical agenda where momentarily, I’m going to hand it over to Rich, who will walk us through some highlights from the quarter. I will follow up with a few observations after Rich makes his comments and then we will be opening it up for Q&A. Before I hand it over to Rich, a few comments from me. Based on everything, I can see — it would look as though the stage is being set for what one might call yet another but-for quarter for the industry. It would seem as though cat losses don’t make a difference. And bizarrely, from our perspective, people seem very quick to back out cat losses as though it’s not real money. But ironically, they don’t seem to back out the premium associated with the exposure that just had the losses. So again, from our perspective, it’s no wonder why the industry struggles oftentimes to make good risk-adjusted returns. In order to do that, one needs to recognize the exposure taking on and not pretend that it doesn’t exist, particularly when it occurs. Through our lens, we are in the capital management business. We are focused on risk-adjusted returns and around here, cat losses count. In our opinion, it is not Monopoly money. It is real money. And when we measure how we are doing, we do not back out cat losses. Perhaps we are a bit of an exception to the industry but ultimately, we think it is an economic reality and that’s not something we shy away from. So with that, Rich, if you would, please. Richard Baio: Of course. Thanks, Rob. Net income doubled from the prior year quarter, resulting in $356 million or $1.30 per share. Annualized return on beginning of year equity was 21.1%, driven by strong underwriting and record investment income results. Operating return on equity was excellent at 18.4% and the heightened industry-wide catastrophe activity in the quarter enabled us to once again demonstrate our underwriting discipline in challenging environments. Simultaneously, our decision to maintain a short duration, high credit quality investment portfolio has enabled us to benefit from higher interest rates. Net investment income increased almost 43% to a record $245 million. The core investment portfolio grew 71.6%, driven by a higher book yield at 4.2% in the quarter compared with the preceding consecutive quarter of 3.8% and second quarter of 2022 of 2.6%. Second quarter operating cash flows of $709 million, combined with the first quarter, brings us to a first half year record of almost $1.2 billion and strengthens our ability to grow investable assets at higher interest rates. A duration of 2.3 years also positions us well to reinvest assets at a higher new money rate on fixed maturity securities compared to the roll-off of existing investments while maintaining our high credit quality of AA-. The investment funds reflected a loss of $1 million, driven by a decline in market values in certain funds in the consumer goods, real estate and financial services sectors. Please keep in mind that we report our investment funds on a 1-quarter lag. Pretax net investment gains in the quarter of $59 million is comprised of net realized gains on investments of $47 million and an improvement in unrealized gains on equity securities of $21 million, partially offset by an increase in current expected credit losses of $10 million. Turning to underwriting results. Underwriting income was $265 million, representing a calendar year combined ratio of 89.6%. Current accident year catastrophe losses were $54 million or 2.1 loss ratio points compared with the prior year of $58 million or 2.5 loss ratio points. Prior year development was favorable by $3 million or 0.1 loss ratio points, bringing our current accident year combined ratio ex cats to 87.6%. Current accident year loss ratio ex cats was 59.5%. The expense ratio ticked up 0.4 points to 28.1% in the quarter, consistent with the expectations we previously communicated. The 2 main contributors include the change in reinsurance structures as well as increased compensation costs and start-up operating unit expenses. We’re working hard to identify and implement innovative strategies to drive operating efficiencies and leverage technology in order to reduce operating expenses across the entire organization. Closing out the underwriting discussion with premium production. We increased gross premiums written by 9.3% to a record $3.3 billion and net premiums written increased 8.7% to a record $2.8 billion. All lines of business grew in the Insurance segment, with the exception of professional liability and workers’ compensation, while property reinsurance grew in the Reinsurance & Monoline Excess segment. Stockholders’ equity remained strong at almost $6.9 billion after returning more than $320 million of capital to shareholders in the quarter. We repurchased almost 5.1 million shares for $292.5 million at an average price per share in the quarter of $57.79. In addition, we paid regular dividends of $28.3 million. The combination of these capital-related actions for the first quarter including the special dividend translates to $614.5 million returned to investors on a year-to-date basis or 9.1% of the beginning of year stockholders’ equity. Rob, I’ll turn it back to you. Thanks. Pixabay/Public Domain Robert Berkley: Rich, thank you very much. Very helpful. So look, I think the market continues to not operate in any type of lockstep where major lines, as we’ve discussed in the past, continue to somewhat march to the beat of their own drum. In addition to that, we continue to see the marketplace struggling with trying to strike the balance between rate need and keeping up with loss cost trend, on the other hand, a desire to grow. This is an industry where you can, practically speaking, grow as quickly as you want to. It really becomes a much more challenging exercise, though, when you were looking to achieve a certain loss ratio which will deliver a return that is acceptable in the end. For us, rate adequacy to support a reasonable loss ratio and deliver an acceptable return has, is and will remain a priority for us. I believe that this has been demonstrated over time through our results and, obviously, our continued focus on making sure that we are keeping up with trend comfortably. A couple of soundbites on the marketplace and major product lines. And I would hope it will dovetail in with some of Rich’s comments and where we have been growing and parts of the marketplace that we find less attractive and we’re playing a bit more defense. For starters, speaking of defense, I think public D&O within the professional line space is clearly a place that one needs to pause and tread carefully. We are seeing the pricing erode at a very rapid pace. Clearly, there has been good margin in the business but that seems to be whittling away quite quickly. As far as liability lines and maybe under the umbrella of social inflation, we continue, particularly in the auto space or especially commercial auto, to see great challenge. That’s also spilling over into GL and, ultimately, umbrella. And what I mean by that is the plaintiffs’ bar is very aggressive and they are taking a variety of new tactics. We think that we are able to keep up with it appropriately through terms, conditions, attachment points and, of course, pricing. But it is not lost on us that it is a challenging moment and requires one pay close attention. In addition to that, there is growing evidence that the tail associated with some of these product lines maybe extending a little bit, particularly on the claims — excuse me, on the occurrence front and to a certain extent, on certain aspects of the claims made upfront. Property, I think it has finally come into focus what needed to happen as it relates to cat-exposed properties and that seems to be spilling over into the non-cat or risk property account where additional rate is required. The other piece that’s worth mentioning, at least through, in my opinion, is Tier 2 cat which I would define as severe convective storm, wildfire, winter storm, etcetera. These are things that were a bit of an afterthought. And I think after the past several years, they are becoming much more front of mind. Last comment as it relates to market conditions would be workers’ compensation, certainly a topic we have discussed on these calls in the past. There was a period of time during COVID, where clearly, there was a break that was caught on the frequency front for the industry. Frequency has returned to a more traditional norm but one of the things that we’ve been waiting for and we’re starting to finally see rear its head is medical inflation. It is our expectation that you are going to see more medical inflation coming through to all payers, including the workers’ comp space. And as a reminder, slightly over 50% of every claims dollar associated with workers’ compensation stems from medical. So again, we can get into more details on that to the extent people are interested later on. Last comment on the marketplace. There continues to be this bifurcation between where the standard market, particularly national carriers, have an appetite. They seem to be very aggressive. But where they don’t have an appetite, that is creating great opportunity for the specialty, in particular, the E&S space. The submission flow that we continue to see remains robust and we are very encouraged with what the balance of the year likely holds and beyond. And certainly, the early returns on July are positive. Rich talked about the top line. Obviously, we benefited from the rate increases that we continue to get, the ex comp rate increase during the quarter was 8.2% which was reasonably consistent with what we saw earlier this year. I think the loss ratio demonstrates, yet again, our strategy around how we manage exposure, how we have balance in the portfolio and how we think about risk and return. And certainly volatility is folded into that and, in our opinion, is a key component in building book value. As far as the expenses go, Rich touched on that as well. We remain very focused on making sure we’re thoughtful about the dollars that we spend and there’s nothing that leads us to believe that, that number won’t remain comfortably below 30. And pivoting over to the investment portfolio, we remain — we continue, I should say, excuse me, to be rewarded for the position that we took as it relates to duration. Obviously, as we’ve discussed in the past, we benefited in having less of an adverse impact on our book value as rates moved up. And in addition to that, we were able to put money to work at higher rates more quickly than many of our peers. The new money rate in the quarter was probably around 5.25%-plus and as you would gather, relative to the book yield at 4.2%, that would suggest we still have significant upside and that will come into focus over some period of time. Rich mentioned the duration at 2.3, I think it was at 2.4 last quarter. Just to clarify that, that was really as much as anything, just rounding. That having been said, we are paying close attention, as you would expect, for the window of opportunity; and when it presents itself, likely you’ll see that duration start to push out again. So all things being equal, I think a very solid quarter for us on virtually every front. I think when you take into account the cat activity that the industry faced, we fared particularly well. And in spite of that, our ability to generate a 21% return, I think, is really a great positive and a tribute to our colleagues and to our strategy and how effectively they are executing. When the day is all done, the goal of the exercise is to build book value. There is no question that is the goal. Ultimately, it’s when building book value, it is not just about the steps you take forward. It is also about the steps you take — that you avoid taking backwards. So with that, Breanna, we’d be very pleased to open it up for questions. Thank you. See also 15 Best Interest Yielding Checking Accounts in the US and 13 Best Consulting Stocks to Buy Now. Q&A Session Follow Berkley W R Corp (NYSE:WRB) Follow Berkley W R Corp (NYSE:WRB) We may use your email to send marketing emails about our services. Click here to read our privacy policy. Operator: [Operator Instructions] Your first question comes from Elyse Greenspan with Wells Fargo. Elyse Greenspan: My first question, Rob, is on the underlying combined ratio, the 87.6% in the quarter. I was just curious if there was anything one-off in that number. I know the last couple of quarters, we’ve seen some elevated non-cat fire losses that you guys have called out. Was there — were there any similar losses in the quarter or anything within that 87.6% we think about the level of margin we could see in the balance of the year? Robert Berkley: That pig is still making its way through the python. I don’t have a specific number for how much it contributed but it is reducing, if you will but it did play a role. I think the other piece is just general mix as well in the portfolio. As you can see, it shifts a little bit every day as far as the underwriting portfolio. But yes, there was a little bit of non-cat property in there but it is diminishing. Elyse Greenspan: And then in terms of the mix, right? So your rate ex comp in the quarter was 8.2, right? We can call that stable with the 8.3 last quarter. And I would have thought, like given we’ve heard of a lot of strength within property in the quarter that you might have seen the rates move up a little bit. Is that just a function of mix? Robert Berkley: Yes. I think it’s a function of mix. And certainly, we are benefiting as much as anyone on the property front. At the same time, there are clearly challenges for workers’ compensation. And you can see that and, quite frankly, how much we are growing or not there. And on the professional liability side, as Rich flagged as well, D&O is very competitive. So the number that we give you is an aggregate, obviously but I can promise you that we are getting good traction on the property front. And the more cat exposed it is, the more traction we are getting and it’s significant. Elyse Greenspan: And then one last one. The PYD, you guys said was favorable $3 million. I know you guys typically wait for the Q to give insurance versus reinsurance. But could you give us a sense of the magnitude in one segment versus the other? Robert Berkley: Honestly, relative to the reserve position in both, it was de minimis. I think one — I don’t have the number exactly in front of me but one was a little bit positive and one was a little, I think, modestly negative, if bad [ph]. Operator: Your next question comes from Alex Scott with Goldman Sachs. Alex Scott: First one I had is on the reserve sort of a follow-up on the PYD question. In your commentary, you mentioned occurrence and the tail potential yet extended. You mentioned plaintiffs’ bar and medical inflation and so forth. I mean I would think all of these things would potentially put pressure on some of those reserves. Can you talk about why you didn’t feel like you needed to make adjustments, sort of confidence in those reserves despite some of those headwinds that you see? Robert Berkley: The answer is because a lot of what you — I was referencing and you just referenced are things that we have been anticipating. And when people have been asking us, why aren’t you dropping your current accident year? Why aren’t you dropping your loss ratios? Because there’s a lot of uncertainty out there. So we feel very comfortable about where we sit at this stage. We revisit and look at our loss ratios by product line at a very granular level with some regularity, that being every 90 days. And we think we are in a good place to be able to absorb what we are seeing......»»

Shares of Cinemark Holdings Inc. CNK fell 3.2% in premarket trades Wednesday after J.P. Morgan downgraded the stock to neutral from overweight, citing the impact of the actors’ strike. J.P. Morgan also established a December 2024 price target of $18 for the movie theater operator, down from its December 2023 price target of $21. In a note, J.P. Morgan analyst David Karnovsky warned of the strike’s impact on film supply and box office, with production already shut down on several movies slated for release in the second half of 2024. “Absent a resolution, we expect the strike will remain an overhang to CNK shares and limit upside regardless of whether the box office outperforms near term (e.g., Barbie and Oppenheimer) or the company posts better than expected results,” he wrote.Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news......»»

A Crisis Of Bad Faith & Sickness: "What Will Happen When Fear Turns To Anger?" Authored by James Howard Kunstler via Kunstler.com, Situational Awareness “All across the board, illness, disability, cancer, heart, autism, fertility…WeFkdUp !!!” - The Ethical Skeptic on Twitter What if Dr. Geert Vanden Bossche is correct? The Dutch virologist said at the outset of the Covid-19 episode in 2020 that vaccinating the world in the midst of an epidemic was insane because it would train the virus to evolve more dangerously while disabling human immune systems. Last week he issued a warning that the world was within weeks of just such a new and deadly immune escape variant outbreak that would bring on a shocking wave of sickness and death among people who received multiple Covid-19 vaccinations. This would happen on top of an already accelerating rise in latent vaccine adverse reactions manifesting as aggressive cancers, blood disorders, cardiac injury, neurological disease, and much, much more. To this point in the Covid-19 story, Western Civ in general, and the USA in particular, have descended into an epic group psychosis as a result of the managed mind-fuckery induced by their own governments in collusion with a pharmaceutical industry metastasizing on money the way an aggressive cancer feeds on sugar in a human body. Fearful citizens swallowed all manner of unreality foisted on them by means of propaganda and censorship. We still don’t know for sure how, who, and why, exactly, Covid-19 was set loose on the world, and the public health agencies don’t want you to know. Perhaps the worst and most baldly dishonest act was the official suppression of effective treatments with common, safe, anti-virals that could have saved millions of lives. And all just to preserve the vaccine companies’ liability shield from the Emergency Use Authorization. In fact, governments are still militating against the sale and use of ivermectin and hydroxychloroquine, which could be taken prophylactically in anticipation of a new outbreak. So, if these populations were driven crazy by authorities ginning up their fear and preying on it, what will happen if that fear turns to anger instead? Because that’s exactly what will happen when Americans, and perhaps even Europeans, realize they’ve been subject to history’s biggest homicidal fraud. That anger is going to seek targets, and they are going to find them very easily in their own government officials and also — get this — in the medical establishment that has betrayed its patients so unconscionably. It’s just impossible to say exactly how that will play out on-the-ground. Governments are already falling — Spain, the Netherlands — but these were parliamentary downfalls according to regular political procedure. Our country has no such procedures for changing authority in a time of crisis. Instead, we have a president up to his neck in bribery scandal and executive agency thuggery, and political parties sunk in corruption, and no way to get rid of them except elections many months away — elections which at least half the people don’t believe are honest. This crisis of bad faith and sickness is happening at the same time that Western Civ enters an equally vicious crisis of economy and finance. America and Europe are broke. All are playing games with their conjoined banking systems and their currencies. All are de-industrializing economies strictly based on industrial production of goods no longer being produced, and pretending to replace them with economies of computer vapor-ware. That can’t work and can only end badly in collapsing standards of living. The past few years, an apparent coalition of global elites, functioning in orgs such as the WEF, the WHO, the EU, the IMF, the central banks, and countless NGOs, along with shadowy intel units and what remains of the old news media, have promoted ever more desperate top-down control programs to prevent a breakdown into wholesale economic and political disorder. Their efforts increasingly tilt into pretense. Try to impose digital currencies and health passports? Fuggeddabowdit. You will only get a chaos of work-arounds, non-compliance, and probably violent opposition. Keep that stupid, dishonorable, perfidious, and unnecessary war going in Ukraine and you run the risk of turning Western Civ into a matched set of ashtrays. As you can see, there has already been enough official mischief, crime, and malfeasance to severely piss-off the population. If Dr. Vanden Bossche is correct, we are perhaps heading into the conclusive shock of an evil era. Some kind of monumental correction will be in order. The people will need some way to regain credible self-governance, either through personnel change in every locus of power, or some revision in structure and procedure. For now, there is little faith that our institutions can manage either of those options. Better maintain situational awareness as we creep into the unknown. *  *  * Support his blog by visiting Jim’s Patreon Page Tyler Durden Mon, 07/17/2023 - 16:20.....»»

The Death Games Of Ukraine Authored by David Patrikarakos via UnHerd, Down in a bunker a little way back from the Ukraine frontline, I am watching a staple of modern warfare: a drone attack in real time. The command centre is a small room with three TV monitors, two of which are divided into four screens. All are showing drone footage from different parts of the front’s 20 kilometres of trenches. Four men sit in front of the screens. Two men sit off at the side — one on a laptop, one manning a two-way radio. In the centre of the room stands Bereza, the Brigade commander, barking voicenotes into his phone. Two of the screens go black and a message pops up: “Your livestream will play again as soon as it’s available. Get Ready!”  I’m told it happens all the time. The screens cut in and out for all manner of unpredictable reasons. But, then, the image reappears and we are looking at a forest. A Russian tank is on the move — changing direction and wheeling around. The men inside this room are trying to destroy it. Their constant banter —  about girls and weapons — doesn’t seem to affect the focus with which they pursue the tank. One man shouts into the radio; Bereza growls into his phone. A screen goes black again. “Your livestream will play again as soon as it’s available. Get Ready!” A screen flashes with light. Then billowing smoke. The men whoop and cheer. I have just seen a successful strike. Dima grins. The atmosphere is electric but also strangely banal. The exclusively male cohort, the puerile jokes, the screens, the repeated invocation to “Get Ready!”. It’s like they are all playing a video game. “This is modern war, David” says Dima. “The war online.” In some respects, 21st-century warfare began the first time a US MQ-1 Predator UAV (that’s an unmanned Aerial Vehicle) drone flew over the Taliban’s positions to photograph the scene below. The Americans realised drones could be used for more than snooping. They could be modified for combat, armed with missiles and other incendiary devices. China, Iran and Turkey joined the arms race, and now they flood the market with their own cheap and effective drones. For any state fighting without the wealth of the United States and China (which is everyone else), what is cheap and effective is also necessary. Out in Ukraine, the skies throng with Chinese-made DJI Mavics, Iranian Shaheds, Russian Orlan-10s and Turkish Bayraktar TB2s. Drones may not have the same payload or firepower as a fighter jet, but then again you can’t buy a fighter jet on the internet. For the price of one F-35, you can buy 55,000 DJI Mavic 3s. For less established militaries, drones offer the chance of levelling the field to at least some degree. I spot a DJI Mavic 3 drone amid the scattered clothing, food and weaponry in the Dnipro 1 base. It’s not more than around 13×12 inches. This is a civilian camera drone — anyone can buy it online for around $3,000. If resource constraints breed creativity, then the Ukrainians are becoming artists. When I covered the battle of Bakhmut, an officer there explained to me how his unit could take out a multi-million-dollar T90 Russian tank by simply buying a Mavic online and fitting it with a small explosive. The Ukrainians have become masters of modifying consumer drones for conflict; of weaponising the everyday into something far more potent. There is an atmosphere of relaxed watchfulness here. The sound of shells and rockets is distant but constant. The soldiers are fighting the Russians up close with tanks, rockets, artillery, sometimes even rifles. And always drones. Some, including the Iranian-made HESA Shahed 136 that the Russians use, are designed to directly strike targets. These are generally expensive — though the Shahed comes in at around $10,000 upwards, which makes it affordable enough to be expendable (only increasing their threat). But the Ukrainians mainly use drones as “eyes in the sky” — they use the cheaper camera ones to spot enemy targets and then call in their coordinates to other units, mainly artillery, to enable them to strike them more accurately. When ammunition and equipment stocks are low, firing must be accurate. On the front, there are few second chances. “If I had had this technology in 2014, Putin would not have been able to occupy any of our territories. Fact,” says Dnipro 1 commander Yuriy Bereza. “The most important thing now is online comms. The most important thing is that I can see the reality on the ground.” He’s whittling a piece of cardboard with a knife, which he waves it around for emphasis as he makes his point. “When soldiers are on the front they are stressed and often give the wrong information, but with a drone I can see the situation calmly on the screen… I see the reality, the truth of it all — from above. It impacts how quickly I can make a decision. And whoever is quicker wins. “It’s incredible how drones are changing the war. If I turn on my phone – a rocket will come out of the sky and land on me. The Russians can track it and they have orders to kill me. So many things in war now are about WhatsApp, Facetime, Signal — wars are being run out of phones. And if you leave a phone on in the wrong place you can die.” The next morning after coffee, Bereza calls over a soldier who introduces himself as Oleksiy and who was part of the team last night. He is a studious-looking man who before the war was, like Dima, an IT engineer. Once those fighting here would have been the most physically impressive. Now they are recruited for their digital skills. Contemporary conflicts now require different types of soldiers — and they’re neither AI-generated nor Olympians. He explains that what I had seen yesterday was part of a multi-pronged mission to stop two Russian tanks trying to destroy Ukrainians positions on the zero line while simultaneously trying to draw the unit’s attention away from an attack from the other side. “My role is to coordinate the direction of fire and to give tasks to the different units around me. Those who pilot the drone; those who analyse the coordinates; those who shoot — all of them I coordinate on the battlefield.” He picks up a book from the table. “Look at this book on how to be a commander. It’s several years old, but we need to react to events as they are now. Military doctrine is like a computer program, it needs to be updated every six months. Drones are the best for choosing tactics, not tomorrow, but right now.” And you need to be creative. Last night one of the tanks managed to get away but they got the other one by sending the drone up to follow it in real time and then send its coordinates to the artillery as it moved. They could direct their fire in such a way that while they didn’t hit it directly, they forced the tank onto a mine, blowing it up. The whole operation took about three minutes. How would they have done this operation without drones?  “Before drones,” he replies, “the only eyes we had were of the infantry. We sucked.” What about the air force? He smiles. “Well, for a start the Russians also have more planes. But even so, maybe you can hear a tank from a plane, but you cannot work out where it is. Especially if the tank is hidden and then two minutes later comes out of its hiding place — and the Russians use jamming systems to disguise their movements, but we use drones from a big distance to get around this. Drones allow us to watch the battle in real time.” The benefits drones bring are more than just narrowly military. For a start, there is the question of morale. One of the unit’s key tasks, Oleksiy explains, is to aid their infantry. “When they see us over their heads, [they know] we are protecting them, so they are happier to stay on their frontlines positions, because they know we can be there in one minute,” he says. This, in the end, it’s what it’s all about in war: speed. And drones, if used properly, give you that. Right now, the Ukrainians are reaping the rewards. The Russians are neither stupid nor technologically naive. According to reports, Ukraine is losing around 10,000 drones per month to Russian electronic warfare. When I spoke to Dima earlier in the year, he told me how much better the enemy was getting at jamming and disrupting his attacks and how much more advanced they were in medium-range drones. Now, 18 months on, despite all their problems, the Russians remain in the field and they are getting better. They have significant technological capabilities — and, crucially, they are learning from their mistakes. The Ukrainians, meanwhile, are forced to crowdfund for drones (and indeed other equipment). The Russians, bereft of international or often popular domestic support, are reliant on Moscow to keep delivering. It does so inadequately and with little concern for its own men. But its artillery is still firing, and its drones are still in the air. And as the counteroffensive intensifies all the way up and down the line of contact, it is becoming clear that whoever wins the drone wars will come to hold the upper hand in the war — perhaps for good. Tyler Durden Thu, 07/13/2023 - 02:00.....»»

Sergei Shoigu was the target of a rebellion by fighters from the Wagner Group mercenary outfit as they marched on Moscow. Russian President Vladimir Putin (L) shows mushrooms to Defense Minister Sergei Shoigu during his vacation in the remote Tuva region in southern Siberia, in August 2017.Alexey Nikolsky/Sputnik/AFP via Getty Images Russia's Minister of Defense, Sergei Shoigu, is a close ally and friend of Vladimir Putin. But as Russia's invasion of Ukraine faltered and stalled, he became a lightning rod for criticism. An armed rebellion led by Wagner's chief Yevgeny Prigozhin sought to oust him from power. This is Sergei Shoigu, Russian President Vladimir Putin's right-hand man.Russian Minister of Defense Sergei Shoigu.Contributor/Getty ImagesAs Russia's Minister of Defense, he is responsible for its invasion of Ukraine.Russian President Vladimir Putin and Russian Defense Minister Sergei Shoigu hold a meeting at the Kremlin, in Moscow on February 14, 2022.Alexei Nikolsky/Sputnik/AFP via Getty ImagesBut the stark failures of the Russian army there have undermined his decades-long ascent to the top rungs of power.Russian President Vladimir Putin (R) and Defense Minister Sergei Shoigu (L) seen during the Navy Day Parade in Saint Petersburg, Russia, on July, 31 2022.Contributor/Getty ImagesShoigu was born in 1955 in the remote town of Chadan in Siberia. The Soviet Union was a world power and the Cold War just beginning.A man outside the former central temple for Buddhists of Tuva, near the settlement of Chadan, in Russia's Tuva region.Ilya Naymushin/ReutersThe town is close to the Mongolian border.Shoigu's mother was Russian but born in Ukraine, while his father was Tuvan — an ethnic group that is indigenous to Siberia.Source: The Moscow Times   Unlike other people in Putin's inner circle, Shoigu was not educated in St. Petersburg or Moscow.Russian President Vladimir Putin accompanied by Kremlin spokesman Dmitry Peskov (second from left), Defense Minister Sergei Shoigu (third from left), and Foreign Minister Sergei Lavrov (third from right), waits for a meeting in Sochi, Russia on February 14, 2019.Sergei Chirikov/AFP via Getty ImagesIn 1977, Shoigu graduated from the Krasnoyarsk Polytechnic Institute in Siberia with a degree in civil engineering. He went on to work on a variety of major construction projects in the region."Shoigu is the only figure within Russian President Vladimir Putin's inner circle who isn't either an old KGB buddy or an old friend from St. Petersburg," Mark Galeotti, who heads the Russia-focused consultancy Mayak Intelligence, told Insider. Putin was born and studied in St. Petersburg and spent much of his early career there.Source: The Kyiv PostDespite being Russia's Defense Minister, Shoigu never served in the military.Defense Minister Sergei Shoigu during military exercises in the Pacific Ocean on July 16, 2013.Alexei Nikolsky/AFP via Getty ImagesHe wears awards on his uniform that look like combat medals, despite his lack of battlefield experience.Russian Defense Minister Sergei Shoigu salutes soldiers and participants during a military parade in Moscow, Russia on May 9, 2015.Sefa Karacan/Anadolu Agency/Getty ImagesShoigu's official profile lists a string of presidential and state awards for his time in government, while his Russian-language Wikipedia page lists more than 70 separate honors.They include medals from his own defense ministry for implementing policies there, and also mass awards marking events like the 300th anniversary of the founding of St. Petersburg.Radio Free Europe, the US-funded outlet, reported last year that Shoigu has a fascination with medals, and implemented hundreds of new ones for the Russian military, many of which are not to do with combat. After working in various roles for construction companies in Siberia, Shoigu moved to Moscow in 1990 to lead the state's committee for construction and architecture.Sergei Shoigu explains the nature of the accident at the Sayano-Shushenskaya hydroelectric power station in Cheryomushky, Russia on August 19, 2009.Alexander Nemenov/AFP via Getty ImagesSource: The Moscow TimesIn 1991, while he was there, the Soviet Union collapsed, plunging Russia into a period of instability and unrest.The front page of The New York Times on December 26, 1991.National Security ArchiveOut of the chaos, Russia gained its first president — Boris Yeltsin, a personal friend of Shoigu. He was soon promoted to lead the newly-established Russian Rescue Corps.Former Russian President Boris Yeltsin shakes hands with Sergei Shoigu during an awards ceremony on October 27, 1999.ReutersIn the Russian Rescue Corps, Shoigu was responsible for the rescue and disaster response system, The Moscow Times reported.His career there soon took off.In his role, Shoigu would be the first to appear at any major or minor disaster sites, presenting himself as a hero.Russia's Prime Minister Vladimir Putin and then-Emergencies Minister Sergei Shoigu visit the site of a Polish aircraft crash near Smolensk airport, on April 10, 2010.Alexey Nikolsky/AFP via Getty Images"He had a big PR team, let's be perfectly honest," Galeotti told Insider.He stayed on the job for 21 years, even after Russian President Vladimir Putin took over from Yeltsin.Source: The Moscow TimesWhen Putin rose to power in 1999, the two became very close.Russian Prime Minister Vladimir Putin and Sergei Shoigu in Moscow, Russia, on September 21, 2009.Alexey Druzhinin/AFP via Getty ImagesShoigu's successful record and large public profile seemed to appeal to Putin.In 1999, he picked Shoigu to be one of the leaders of his party, United Russia, giving him the opportunity to build a political base.Thirteen years later, in 2012, Putin promoted Shoigu briefly to be the governor of the Moscow region, and from there to run the defense ministry.This gave Shoigu a role on the world stage and a central place in Russia's clashes with the West.Sources: Database of Free Russia Forum, Foreign AffairsShoigu and Putin would often be photographed together. They took regular vacations in the Siberian woods, where they would go fishing or hiking.Russian President Vladimir Putin (L) accompanied by Sergei Shoigu gestures as he fishes in the remote Tuva region in southern Siberia, on August 3, 2017.Alexey Nikolsky/SPutnik/AFP via Getty ImagesTheir most recent vacation together appears to have been in March 2021.Source: The KremlinAs the president of the Russian Geographical Society, Shoigu would also indulge Putin's interest in the outdoors.Russian President Vladimir Putin and Russian Defense Minister Sergei Shoigu during a vacation in the remote Tuva region in southern Siberia, on August 26, 2018.Alexey Nikolsky/AFP via Getty Images"Putin and Shoigu are both throwbacks to Soviet times. They regard themselves as 'muzhiks' (real Russian men) who love sports and hunting," British magazine The Spectator observed in 2015.This interest may have taken a surreal, even macabre turn.Russian investigative news outlet Proekt reported in April that Putin has taken up bathing in blood extract from severed deer antlers as a form of alternative medicine. The bath is believed to improve the cardiovascular system and rejuvenate the skinThe unusual remedy was a suggestion made by Shoigu, the report said. Source: The New York Times Shoigu likes to play hockey. He also enjoys carpentry and has shown some of his work to Putin.Russian Defense Minister Sergei Shoigu attends a hockey game in Moscow, Russia, on April 20, 2018.Alexander Nemenov/AFP via Getty ImagesSources: MK.RU, ReutersAt one point in his career, Shoigu was touted to be the next prime minister.Russian President Vladimir Putin and Defense Minister Sergei Shoigu rest during a holiday in Siberia on March 21, 2021.Alexey Druzhinin/Sputnik/AFP via Getty ImagesIn the early days of his role as minister of defense, Shoigu was considered the second most popular public figure in the country and was even touted as Putin's potential successor.Source: The Daily BeastShoigu is said to have a lavish lifestyle and owns a large mansion outside of Moscow estimated to be worth around $18 million.Russian President Vladimir Putin toasts Defense Minister Sergei Shoigu at the Kremlin in Moscow on December 28, 2017.Kirill Kudryavtsev/Poo/AFP via Getty ImagesThe investigative team of jailed Putin critic Alexei Navalny photographed Shoigu's home using high-tech drones in 2015.Shoigu presides over a culture of corruption and embezzlement in the Russian military, according to some reports. An investigation by the independent Russian news outlet The Insider in 2019 claimed that he earned 6.5 billion rubles ($101.9 million) from deals with the ministries of defense and emergency situations.(The Insider is a separate publication from Insider.)Shoigu was behind the invasion and annexation of Crimea in 2014 and was also one of the architects of Russia's intervention in Syria one year later.Russian President Vladimir Putin talks to Defense Minister Sergei Shoigu during a military parade in Saint Petersburg, Russia, on July 25, 2021.Mikhail Svetlov/Getty ImagesSource: CNBC, Los Angeles TimesOne day after Russia's invasion, Shoigu was personally sanctioned by the West.Russian Minister of Defense, Sergei Shoigu (C) speaks as he virtually attends the Summit of Collective Security Treaty Organisation on May 24, 2022.Russian Foreign Ministry Press / Handout/Anadolu Agency via Getty ImagesOther members of Putin's inner circle who were sanctioned alongside Shoigu included Minister of Foreign Affairs Sergei Lavrov and Chief of the General Staff of the Armed Forces Valery Gerasimov.Source: Department of State, PoliticoSeveral days before Putin's full-scale invasion in February, Shoigu met with British Defence Secretary Ben Wallace and denied Russia was planning to attack Ukraine.Russian Defense Minister Sergei Shoigu and chief of the general staff Valery Gerasimov in Moscow, Russia, on February 27, 2022.ALEXEY NIKOLSKY/SPUTNIK/AFP via Getty ImagesThis was despite Western intelligence services publishing extensive evidence of Russian troops amassing near Ukraine's borders, and claims from figures including President Joe Biden that an invasion was inevitable.Source: ReutersBut when Russia did invade on February 24, it did not pan out the way the Kremlin had planned.An abandoned Russian vehicle in a retaken area near Kharkiv, Ukraine, on September 30, 2022.Yasuyoshi Chiba / AFP via Getty ImagesRussia seemed to expect it could take Ukraine's capital Kyiv in a matter of days, but failed to do so.For months, their forces have struggled in the face of a staunch Ukrainian resistance that continues to receive more heavy weaponry from Western allies.Russia's partial mobilization in October was also a sign that Shoigu's military was suffering from a severe lack of manpower.The failures in Ukraine have led to claims of a rift between Shoigu and Putin.Russian President Vladimir Putin meets with Defense Minister Sergei Shoigu at his Novo-Ogaryovo state residence, outside Moscow, on October 28, 2022.Mikhail Metzel/Sputnik/AFP via Getty ImagesOne month after Russia's invasion, there was "persistent tension" between the two friends after it emerged that Shoigu and his subordinates were sugar-coating reports of the war for Putin, The New York Times reported at the time.In March, Shoigu wasn't seen in public for 12 days, prompting concerns over his whereabouts, The Guardian reported.In August, Putin started to bypass Shoigu, further embedding himself into the war's strategic planning efforts, The Telegraph reported.Source: Insider Other prominent figures in the Kremlin have openly attacked Shoigu, including Russian oligarch Yevgeniy Prigozhin.Yevgeniy Prigozhin at a meeting in St. Petersburg, Russia, in 2016.Mikhail Svetlov/Getty ImagesYevgeniy Prigozhin, who founded the Wagner private army, confronted Putin about the mismanagement of the war in Ukraine last month, two US officials familiar with the matter told The Washington Post.Prigozhin later denied that he had spoken to Russia's president and said he has no right to criticize Russia's army.Kirill Stremousov, a pro-Russia Ukrainian politician who was installed as Putin's puppet leader in the occupied Ukrainian region of Kherson, recently suggested Shoigu should consider killing himself over Russia's recent military losses.Kirill Stremousov, deputy head of the Russian-backed Kherson administration, is pictured in his office on July 20, 2022.STRINGER/AFP via Getty ImagesStremousov was killed in a car crash in Kherson on November 9, local officials said, according to the BBC.He died hours before Shoigu ordered the withdrawal of his troops from the city.Source: Insider"Shoigu is willing to basically be Putin's bulletproof vest," said Galeotti, the Russia analyst.Russian President Vladimir Putin looks at Defense Minister Sergei Shoigu during a military parade in Pskov, Russia, on March 1, 2020.Mikhail Svetlov/Getty Images"He is soaking up all the criticism that, otherwise, people might start leveling towards Putin as commander in chief," Galeotti said.  Shoigu has remained quiet despite the growing criticism...Russian Defense Minister Sergei Shoigu in Sochi, Russia, on December 4, 2019.Mikhail Svetlov/Getty Images"He's been much less evident now," Galeotti told Insider."He knows that, when he goes into public, he either has to reassure people that everything's going fine, which is an increasingly untenable position to hold, or he'd have to acknowledge things are going badly, which would potentially sound like criticism of the commander in chief," he added.... and Putin has shown no signs that he may fire him.Russian Defense Minister Sergei Shoigu walks in the Taiga in Siberia, on September 26, 2021.Alexey Druzhinin/Sputnik/AFP via Getty ImagesGaleotti told Insider that it is difficult for Putin to fire Shoigu because it is "a card he can only play once." "If Putin absolutely felt that the situation demanded it, I imagine he would be willing to sacrifice Shoigu," he said."However, given that it's obviously not going to have any substantive impact on the progress of the war ... it will be harder to avoid the suspicion that it's not because of Shoigu, but because of Putin."On November 9, Shoigu ordered his troops to retreat from Kherson, the only major city in Ukraine that Russian forces were able to capture during the invasion.A soldier of the Ukrainian army in Kherson Oblast on November 05, 2022.Metin Aktas/Anadolu Agency via Getty ImagesThe retreat was a huge blow to Shoigu, who only a month before had told Putin that his goal to send 300,000 of Russia's reservists to fight in Ukraine had been completed, Reuters reported.After all the retreats, Shoigu stepped up his rhetoric in November, saying that Russia should use new advanced weapons systems in Ukraine.Russian Defence Minister Sergei Shoigu talks with a cadet in Moscow, Russia, on August 20, 2022.Contributor/Getty ImagesShoigu did not specify which advanced weapons should be used, though he said he is looking at new ways of improving artillery and missile attacks.Source: Reuters Earlier this month, Shoigu's alleged ex-lover — and mother of two of his children — was exiled from Lithuania after being deemed a security threat, Lithuanian media reported.Russian Defense Minister Sergei Shoigu seen during the SCTO Summit in Yerevan, Armenia, on November 23, 2022.Contributor/Getty ImagesLithuania's State Security Department said this month that Yelena Shebunova's presence "may impose a threat to the country's national security over her links with Russian structures," Lithuanian National Radio and Television (LRT) reported.It did not elaborate on why she was seen as a threat.According to a 2019 investigation by Russian independent media outlet The Insider, Shebunova and Shoigu have two children together, both born out of wedlock: Daria and Danila.It is unclear how old the children are, but The Insider reported that Shebunova obtained a Lithuanian residence permit in 2017.Shoigu also has two children with his wife, Irina Shoigu, The Kyiv Post reported.In February, Shoigu told military officials the Russian army is "successfully" advancing near the eastern Ukrainian towns of Bakhmut and Vuhledar.Russian Defence Minister Sergei Shoigu at a military meeting at an undisclosed location, on January 17, 2023.Russian Defence Ministry/Vadim Savitsky/Handout via Reuters"Military operations are at the moment progressing with success in the areas around Vuhledar and Artemovsk," Shoigu told a defense meeting using the previous name for Bakhmut.Source: Russian Ministry of Defence, Moscow TimesOn June 24, 2023, Prigozhin dramatically launched an armed rebellion to oust Shoigu and chief of army staff, Valery Gerasimov.Members of Wagner group sit atop of a tank in a street in the city of Rostov-on-Don, on June 24, 2023.STRINGER/AFP via Getty ImagesIn a video message, Prigozhin said that Russian forces had bombed his mercenary group. He led his fighters as they seized control of Rostov-on-Don then advanced towards Moscow. The mercenary chief said he wanted Russia's military leaders fired over failings in Ukraine, but after brokering a deal with the Kremlin backed away from the rebellion. He said he wanted to avoid bloodshed, and went into exile in Belarus. The rebellion was the most serious challenge to Putin's authority in his two decades in power. In the wake of the mutiny, the Kremlin released video showing Shoigu visiting troops in Ukraine.Russian Defence Minister Sergei Shoigu and Colonel General Yevgeny Nikiforov, commander of troops of the Western Military District, talk on board the aircraft as they visit the advanced control post of Russian troops involved in Russia-Ukraine conflict, at an unknown location, in this still image taken from video released June 26, 2023.Russian Defence Ministry/Handout via REUTERSThe video shows Shoigu traveling in a plane, and visiting Russian senior officers. The Kremlin did not say when or where the footage was filmed, and NBC News reported that Russian military bloggers, who've been influential critics of the Kremlin's war effort, said it was filmed ahead of the mutiny. —Yaroslav Trofimov (@yarotrof) June 26, 2023 The video appeared to be an attempt by the Kremlin to signal that Russia's chain of command remained intact after the rebellion, amid rumors that Putin may be preparing to fire Shoigu. Putin had remained silent as Prigozhin launched increasingly aggressive tirades against Shoigu and other military chiefs in the weeks leading to the mutiny, prompting speculation that he was playing them off against each other. Read the original article on Business Insider.....»»

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A Century Of Censorship Authored by 'The Hunt For Tom Clancy' via Racket News, The turn of the last century brought an age of revolutions, industrial warfare and nearly instantaneous communications across long distances. With these developments came an emphasis on another method of war: information war. This was the type of fight waged with what World War II Deputy Director of the Office of Censorship, Theodore F. Koop, called “Silent Weapons,” in a wartime memoir he published in 1946. Wrote Koop: The censors’ shears were bayonets that not only formed a rear-guard national defense but also struck hard at the enemy in all three phases of warfare—military, economic, and psychological. Koop would go on to run CBS News in Washington, DC. Well-known as a powerful media figure, he was also a trusted one, the man who hired Walter Cronkite.  Less well-known was that in 1955, President Dwight D. Eisenhower asked him to run a secret national censorship program intended for use in Cold War emergencies. He accepted the offer while still a network news executive, serving in that contingency role under Eisenhower, Kennedy, Johnson and Nixon. The methods of censorship had changed over time, matching changes in the communication technology. During World War I, the United States Government used the Postal Service, the Comstock laws and the reliance on publications reaching subscribers by mail as a wedge. When radio and television broadcasts became pre-eminent, the newly formed Federal Communications Commission began using its authority as stewards of the public airwaves to watch over content. Under the FCC Act of 1934, ostensibly private corporations like CBS, ABC and NBC were allowed to use the public airwaves only under license, acquiring revenue and learning the power of shaping the discourse from the nascent field of advertising.  Though it all, one thing has been remarkably consistent. Government targeted for special attention journalists who reported accurately on the ugly truth of American foreign policy, such as John W. Powell. Powell was an American journalist based in Shanghai who wrote a series of articles for the China Monthly Review (later, the Weekly Review), which said the Chinese government claimed the United States was using biological weapons in the Korean War. He was put on trial for sedition in 1959. The case dragged on in federal court in San Francisco for five years before the charges were dropped. It was enough to make him leave journalism forever. The impulse to use censorship, and call all information that doesn’t square with the official narrative “disinformation,” is a bipartisan impulse, at least historically. Both Republican and Democratic administrations during the Global War on Terror sought to expand and refine the power of what we now call the Censorship-Industrial Complex. The latter was built, piece by piece, over a century of legislation, executive action, and regulation. A little less than a century after the passage of the Espionage Act, Barack Obama’s administration used it aggressively to target leakers. By that time, computers, the internet, and social media were all new platforms for communication and ripe targets for information suppression.  In an era where cultural memory is short and resources for learning about the inconvenient past are becoming more scarce, it’s useful to look at this century-plus progression in chronological order. Clockwise from top left: Franklin Roosevelt, J. Edgar Hoover, Harry S Truman, and Joseph McCarthy A CENTURY OF CENSORSHIP  June 15, 1917: As the United States enters World War I, the Espionage Act of 1917 is enacted by Congress and signed into law by President Woodrow Wilson, the first academic to become President, prohibiting “obtaining information, recording pictures, or copying descriptions of any information relating to the national defense with intent or reason to believe that the information may be used for the injury of the United States or to the advantage of any foreign nation.” The Act also made obstructing enlistment in the armed forces or causing insubordination or disloyalty in military or naval forces an illegal act. Wilson’s administration also decided that any publications violating the act were “non-mailable matter,” and this rationale was used to suppress dissenting views by aggressively enforcing the postal codes so no subversive publications could reach their subscribers. At least 74 newspapers were denied mailing permits at this time.   Milwaukee socialist Victor Berger, convicted of the Espionage Act in 1914 May 16, 1918: The Sedition Act of 1918 extended the Espionage Act of 1917 to cover more offenses, making it a crime to: incite disloyalty within the military; use in speech or written form any language that was disloyal to the government, the Constitution, the military, or the flag; advocate strikes on labor production; promote principles that were in violation of the act; or support countries at war with the United States. As the Free Speech Center at Middle Tennessee State University notes, “The targets of prosecution under the Sedition Act were typically individuals who opposed the war effort, including pacifists, anarchists, and socialists.”December 13, 1920: The Sedition Act is repealed. May 24, 1936: Roosevelt assigns J. Edgar Hoover to investigate “subversive activity.” According the FBI’s own historical timeline, “President Roosevelt called Director Hoover to a morning meeting to discuss his concerns about subversive activity in the United States. He asked Hoover to report on the activities of Nazi and communist groups. The FBI made these investigations at the request of the Secretary of State for the President.” In 1939, according to the same document, Roosevelt formally assigned responsibility for investigating “espionage, sabotage, and other subversive activities” to a series of agencies and departments, including the “FBI, the Military Intelligence Division of the War Department (MID), and the Office of Naval Intelligence (ONI).” May 26, 1938: The House Un-American Activities Committee is formed. Created as part of a special investigative committee, and reorganized from previous incarnations as the Fish Committee and the McCormack-Dickstein Committee, HUAC had license to “investigate alleged disloyalty and subversive activities on the part of America’s private citizens, public employees, and those organizations suspected of having Communist ties.” Because of its investigations of prominent intellectuals, entertainers, and politicians, HUAC is one of the few bodies on this list that has become a fixture in American pop culture, featured in movies like The Front and Trumbo. HUAC hearing of New Deal economist Charles Kramer, 1948 June 9, 1938: The Foreign Agents Registration Act (FARA) is enacted by Congress and signed into law by President Franklin Roosevelt.  June 29, 1940: The Alien Registration Act, a.k.a. the Smith Act, is enacted, setting criminal penalties for advocating the overthrow of the U.S. government by violence or force, requiring all non-citizen adult residents to register with the government.  Hundreds of communists in America would later be tried under this act.  1940-43?: FBI begins to liaise with an NSA predecessor agency, the U.S. Signals Intelligence Service, which in 1943 was re-named the Signal Security Agency, later became the Army Security Agency, and eventually was absorbed into the NSA. Again according to the FBI’s own internal timeline, the Bureau sometime before 1947, when the NSA would be formed, began a working relationship with the Signals Intelligence Service. This association would bear fruit in the late forties: Began a close liaison with the U.S. Army Signals Intelligence Service, the National Security Agency’s predecessor, on the exploitation of Soviet messages that were being decrypted and decoded by military intelligence personnel. The FBI and the NSA were able to identify several hundred persons connected with Soviet intelligence work against the US and its allies. The project continued until 1980 when it was shut down. Among the prominent cases to come from these messages was the Judith Coplon case, the Klaus Fuchs case, and the Rosenberg case. July/August 1940: Captain John V. Grombach publishes “The Invisible Weapon” in the United States Army’s Infantry Journal on the covert applications of radio technology in warfare and espionage.  Previewing ideas that would become popular in the future, Grobach wrote of mass communication as a weapon: Propaganda and the protection of military secrets are vital both to participants and to nations near the brink of involvement. Thus a mighty power in the struggle for world dominion by nations, forms of government, and ideals is radio.  International radio is just now beginning to be evaluated adequately as the powerful though invisible weapon it is. Just as dominance in the air by plane may be the key to victory on land and sea, so the use of the ether waves may be the most potent means for mastery of the minds and hearts of men, without which no nation or ideal can survive. Charles Grombach as a West Point Cadet (CIA photo) December 19, 1941: Twelve Days after the Japanese attack on Pearl Harbor, President Franklin D. Roosevelt issues Executive Order 8985, Establishing the Office of Censorship under the War Powers Act. February 16, 1942: U.S. Army intelligence creates a secret spying outfit called “The Pond,” to compete with and spy on the newly commissioned Office of Strategic Services. The aforementioned Grombach is selected to direct the new organization, which operates primarily through commercial cover enterprises like insurance agencies. Members of “The Pond.” (CIA photo) April 14, 1942: The Second Class Mail permit for Social Justice, a weekly newspaper founded by fascist and anti-semitic radio personality Father Charles E. Coughlin, was suspended by Postmaster General Frank Walker on the recommendation of Attorney General Francis Biddle.  “Social Justice reproduces, in this country,” Biddle said, “the lines of the enemy propaganda war being waged against this country from abroad. The Espionage Act of 1917 is designed to defeat this attack.” February 1, 1943: The VENONA Project, a secret high level code-breaking program run by the Army and later the National Security Agency in cooperation with FBI, commences. It is kept secret from the President by the Army Chief of Staff, Omar Bradley. 1946: The Assistant Director of the Office of Censorship, Theodore F. Koop, publishes Weapon of Silence: Secrets, Censors, and Spies. In it, he notes that then-Director of the Office Byron Price’s “assurance that press and radio were reverting to peacetime freedom” had proved to be premature.” Focused now on clamping down on discussion of the development of the atomic bomb, the department issued a manifesto: All individuals, groups and organizations connected with the Manhattan Project will continue to comply with present security regulation. Loose talk and idle speculation, particularly by individuals now or formerly connected with the project, jeopardize the future of the Nation. It is the duty of every citizen, in the interest of national safety, to keep all discussion of this subject within the limits of information disclosed in official releases. Koop wrote, “The censors’ shears were bayonets that not only formed a rear-guard national defense but also struck hard at the enemy in all three phases of warfare—military, economic, and psychological.” Then, in a mildly chilling preview of what was to come, he added: For a single country, censorship can be a potent weapon. But when the censorships of a group of nations are linked into a world-wide network, the power is increased to the Geographic Spread. August 1946: Congress passes the Atomic Energy Act. Henceforth, the FBI is responsible for investigating the backgrounds of persons who were to access restricted nuclear data and for investigation of criminal violations of this act. January 1, 1947: the civilian Atomic Energy Commission takes over Manhattan Project operations. One result is a decision to “keep information on the plutonium injections secret,” for reasons not pegged to national security, but “public relations and legal liability concerns.” Lieutenant General Leslie Richard Groves, who oversaw the Manhattan Project March 21, 1947: President Harry S Truman issues Executive Order 9835, a.k.a. “Prescribing Procedures for the Administration of an Employees Loyalty Program in the Executive Branch of the Government.”  A key provision of the latest loyalty-oath scheme is the creation of a Central Master Index: There shall also be established and maintained in the Civil Service Commission a central master index covering all persons on whom loyalty investigations have been made by any department or agency since September 1, 1939. Another key provision is the formation of a “Loyalty Review Board,” under which the Department of Justice would “furnich” the names of “each foreign or domestic organization, association, movement, group or combination of persons which the Attorney General, after appropriate investigation and determination, designates as totalitarian, fascist, communist or subversive.” Truman’s own administration would eventually be targeted by his bureaucratic creation. The DOJ was also responsible for supplying names of people identified as “having adopted a policy of advocating or approving the commission of acts of force or violence to deny others their rights under the Constitution of the United States,” or as “seeking to alter the form of government of the United States by unconstitutional means.” July 26, 1947: The National Security Act of 1947 is signed into law by President Harry S Truman. Among other things, the Act establishes the United States Air Force as a separate branch of the military, and the Central Intelligence Agency as a separate government entity, under the executive branch. January 27, 1948: The US Information and Educational Exchange Act of 1948, better known as the Smith-Mundt Act, is passed. The Act is designed to regulate the broadcasts of propaganda to foreign audiences under State Department guidance, while prohibiting that same propaganda on domestic broadcasts. The ban on domestic propaganda would be repealed in 2013. June 18, 1948: President Harry Truman approves “NSC 10/2,” which creates the Office of Special Projects, the brainchild of George Kennan, director of State Department’s Policy Planning Staff and author of the famed “Long Telegram,” considered a foundational document establishing decades of Cold War policy. The office name is later changed to Office of Policy Coordination and Frank Wisner is chosen as the Director. This Office, staffed mostly by OSS veterans, will be the center covert branch of American political action, until it is incorporated into CIA.    1950s: The Term “Disinformation” begins to be widely used in American and British circles, formed on the pattern of Russian dezinformatsiya. February 9, 1950: Senator Joe McCarthy of Wisconsin gives his infamous “Communists in Government Service” speech. In a Lincoln Day address to the Republican Women’s Club of Wheeling, West Virginia, McCarthy produced a piece of paper and announced: The State Department is infested with communists. I have here in my hand a list of 205—a list of names that were made known to the Secretary of State as being members of the Communist Party and who nevertheless are still working and shaping policy in the State Department. April 1951: Truman establishes the Psychological Strategy Board. They will prove instrumental in funding the 1954 Hollywood Production of George Orwell’s Animal Farm.  January 10, 1953: Mary Dublin Keyserling, wife of former Truman economic adviser Leon Keyserling, is cleared after a Loyalty Review Board case was brought against her by McCarthy. January 22, 1953: Arthur Miller’s The Crucible is published, one of what would become a long series of artistic/metaphorical commentaries on dangerously controversial topics. It’s rumored that the character of Elizabeth Proctor is based in part on Mary Keyserling. Left, Mary Dublin Keyserling. August 24, 1954: President Dwight D. Eisenhower signs “The Communist Control Act of 1954.” Eisenhower explains: The new law which I am signing today includes one of the many recommendations made by this Administration to support existing statutes in defeating the Communist conspiracy in this country… Administratively, we have in the past 19 months stepped up enforcement of laws against subversives. As a result, 41 top Communist leaders have been convicted, 35 more are indicted and scheduled for trial, and 105 subversive aliens have been deported. Eisenhower complained of witnesses who invoked “Constitutional privilege against self-incrimination” and boasted his law would provide a new “means of breaking through the secrecy which is characteristic of traitors, spies and saboteurs.”  April 5, 1955: Koop, now Director of Washington News and Public Affairs for the Columbia Broadcasting System, writes President Eisenhower to say he’s, “honored to accept the Censorship assignment measured in your letter of March 21. I greatly prize your confidence in me. I can assure you that I shall do my utmost to prepare for an eventuality which I hope will never arise. I would deem it a privilege to talk with you at your convenience, as you suggested.” PREVIEW OF THINGS TO COME? Left, Theodoore Koop of CBS. Right, Koop’s letter to “my dead” Dwight Eisenhower, accepting a sub rosa censorship role. June 26, 1958: The construction of DC-01, the first SAGE NETWORK (Semi-Automatic Ground Environment) building in the United States, is completed at Maguire Air Force Base in New York. The SAGE NETWORK would be a series of large computers and networking machines that coordinated data from Radar Sites to produce a single image of airspace. The funding and construction of the SAGE network cost more than the Manhattan Project, and was the backbone of American Air Defense networks until the 1980’s. Connected by modems, telephones and fax machines, the SAGE NETWORK laid the groundwork for the ARPANET and Internet. January 26, 1959: American journalist John Powell is charged with sedition for a series of articles in the The China Monthly Review, where he wrote that the US military used biological warfare against North Korean and Chinese soldiers, incorporating lessons learned from Imperial Japan’s Unit 731. The case would drag on for five years, the government would drop all charges, and Powell would be blackballed from American journalism forever.   March 28, 1960: The current Special Envoy and Coordinator of the Global Engagement Center, U.S. Department of State’s James Rubin, is born in New York City to Harvey Rubin, who would go on to be an executive at the Satra, the Soviet American Trade Corporation, and Judy Rubin, an art therapist who would make regular guest appearances on Mister Rogers’ Neighborhood. March 12, 1963: BROADCASTING MAGAZINE features an item in the “Closed Circuit” section about how the U.S. government is thinking of re-opening a World War II-style office of censorship, after the Cuban Missile Crisis. The item reads: Censorship ahead? There is no “censorship” in present national emergency, White House News Secretary Pierre Salinger was at pains to explain to news media chiefs last week, but plans are going forward and may be announced shortly for Office of Censorship similar in many respects to one operated under ex-AP chief Byran Price during World War II. Remnants of old Office of Censorship have survived during intervening years under leadership of Price’s right hand man, Theodore F. Koop, (CBS vice president) with some of original executive personnel kept on standby basis. Present crisis finds Koop out of the country on vacation, but some other executive reserves have been in Washington for consultation.  1965: Then-Director of Central Intelligence, Vice Admiral W.F. Raborn, who’d made his name in the Government by delivering the Polaris nuclear missile system three years early and under budget using the “program evaluation and review technique,” writes a letter to Clark Clifford, then the head of the President’s Foreign Intelligence Advisory Board, warning of a major foreign disinformation operation whose aim is the “destruction, break-up and neutralization of CIA: What are disinformation operations? “Dezinformatsiya,” in Soviet terminology, is false, incomplete or misleading information that is passed, fed or confirmed to a targetted (sic) individual, group or country. “Propaganda” as it is defined by Free World students, may be used as a support element of dezinformatsiya, but propaganda per se lacks the precision and bite of disinformation. Raborn writes that a purpose of the unit is to “sow distrust” and “create grounds for subversion and revolt against the U.S. in the Western Hemisphere and among the new nations of Africa and Asia… These purposes and objectives, it must be emphasized, have been established by the highest elements of Party and Government in the Soviet Union.” April, 1967: Ramparts magazine reports that the National Student Association received funding from CIA.  September, 1968: Following the Warsaw Pact invasion of Prague to suppress the Czech Spring, Major Ladislav Bittman, former deputy head of head of Czech Intelligence’s Department ‘D’ for ‘active measures,’ (their Secret Service department in charge of “Black Propaganda and disinformation” defects to the United States by way of West Germany. Bittman later changed his name to Lawrence Martin and taught journalism at Boston University. He founded the “Program for the Study of Disinformation” in the mid 1980’s, this is the first academic center in the US to focus on disinformation.    December, 1968: The Stanford Research Institute (SRI) issues a report “A Study of Computer Network Design Parameters” to the Advanced Research Projects as part of the development of ARAPANET, the forerunner to the internet. June 30, 1971: In a 6-3 Ruling, the Supreme Court rules in favor of the New York Times in New York Times Co. v. United States, which allowed the newspaper to publish extracts from a purloined classified Pentagon history of the Vietnam war. The case is a landmark verdict on press freedom and the burden of government prior restraint. The famed Pentagon Papers case. January 15, 1977: SATRA, The Soviet American Trading Company where Harvey Rubin is vice president, is awarded broadcast rights to the 1980 Moscow Olympics January 4, 1978: The ARPANET Completion Report is published, signaling the birth of the modern Internet.  1981: The Reagan administration founds the “Active Measures Working Group,” an interagency detail led by Department of State official Mark Palmer. Shedding a years-long disinclination to discuss “disinformation” openly, the new group begins to publish papers “countering” Soviet propaganda and Soviet-tied rumors, beginning with a paper in 1981 purporting to debunk stories about U.S. responsibility for the the seizure of the Grand Mosque in Mecca, the killing of a Panamanian leader, and other tales. The first “Active Measures Working Group” paper, 1981 September 20, 1983: The Director of Central Intelligence, William Casey, briefs the House Permanent Select Committee on Intelligence: On the covert side, Moscow has developed a vigorous program of “active measures” that is carried out in large part by a growing overseas presence that includes diplomats, Aeroflot employees, and the representatives of Soviet trade and news organizations… Casey warns that “Soviet active measures” include “media manipulation” and “disinformation,” as well as “agents of influence” and “other subversive activities.” July 24, 1985: The CIA Delivers a report on its “Conference on Contemporary Soviet Propaganda and Disinformation,” writing: The report will be given broad dissemination by the State Department. A number of the conferees suggested that a list of participants would be useful to keep each other informed and to involve each other in related work as time passes. Some saw this as a first step in helping to create a network of specialists interested in disinformation issues. In another past example of media cooperation with intelligence goals, the former editor of Commentary Magazine and US Information Agency adviser Norman Podhoretz is mentioned. Podhoretz “delivered the keynote address to a CIA Dis-information conference,” an address titled, “Causes of Western Vulnerability due to semantic manipulation.” 1985: As a result of a series of high profile espionage arrests, 1985 is characterized in media as the “Year of the Spy.” 1985 was the “Year of the Spy.” February 8, 1996: President Bill Clinton signs the Communications Decency Act of 1996, an attempt to regulate internet pornography.  October 21, 1998: The Child Online Protection Act (COPA) is signed into law by President Bill Clinton. This is one of the earliest legislative efforts to regulate the transmission of web content: Whoever knowingly and with knowledge of the character of the material, in interstate or foreign commerce by means of the World Wide Web, makes any communication for commercial purposes that is available to any minor and that includes any material that is harmful to minors shall be fined not more than $50,000, imprisoned not more than 6 months, or both. October 26, 2001: Shortly after 9/11, President George Bush signs into law the “Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act,” a.k.a. the USA PATRIOT Act of 2001. This sweeping law would provide the foundation for a generation of essentially extralegal anti-terrorist interdiction, and would eventually serve as a template for other, broader efforts to regulate information and conduct surveillance. January 2002: The Pentagon Military Analyst program developed by Assistant Secretary of Defense for Public Affairs Victoria Clarke quietly launches “to spread the administration’s talking points on Iraq by briefing retired commanders for network and cable television appearances,” without disclosing their active Pentagon connections. Analysts were known as “message force multipliers.” March, 2003: The Department of Defense begins a policy of “embedding” reporters within military units for the War in Iraq, provided the embedded reporters agree to ground rules and basic military censorship. March 9, 2006: President Bush signs the USA Patriot Improvement and Reauthorization act of 2005, in the East Room of the White House. House Speaker Dennis Hastert is present at the signing. The Act allows “Internet service providers to disclose customer records voluntarily to the government in emergencies involving an immediate risk of death or serious physical injury and permits victims of hacking crimes to request law enforcement assistance in monitoring trespassers on their computers.” March 21, 2006: Jack Dorsey sends the first message on twitter at 9:50PM PST. “just setting up my twttr.” The Non-Fungible Token (NFT) for that tweet will later sell for $2.9M. Jack Dorsey changes the world, but also takes for us our first steps into a new hell August 2, 2007: S-1959, the Violent Radicalization and Homegrown Terrorism Prevention Act of 2007 is introduced and defeated in the Senate, after passing the house as H.R. 1955 on April 2007. The Bill was Co-Sponsored by Rep. Bennie Thompson, who would later have a prominent role on the January 6 committee.  An Opinion piece in SF Gate in 2008, “Rule by fear or rule by law?” by Lewis Seiler and Dan Hamburg, notes the following: Some media commentary wonders at a law that labels as terrorists people who “engage in sit-ins, civil disobedience, trespass, or any other crime in the name of animal rights” as terrorists. The ACLU, at the time still keenly interested in such issues, releases a statement saying: Law enforcement should focus on action, not thought. We need to worry about the people who are committing crimes rather than those who harbor beliefs that the government may consider to be extreme. January 4, 2011: Tunisian street vendor Tarek al-Tayeb Mohamed Bouazizi self-immolates in Ben Arous, Tunisia, after harassment by municipal officials. This will be seen as the inciting event of the Arab Spring, a series of social media fueled popular uprisings across the Middle East .  September 27, 2011: Michael Furlong, a retired Army psyops colonel, resigns from his SES position in the Air Force after it comes to light that his “INFORMATION OPERATIONS CAPSTONE” program in Afghanistan is cover for a private spy ring operating in “The Grey Zone” of legality, especially since it was run since 2009 by pardoned Iran Contra conspirator and CIA legend Duane “Dewey” Clarridge March 2, 2012: USA Today, which later will become an enthusiastic partner of “anti-disinformation” operations, publishes “US ‘info ops’ programs dubious, costly”: WASHINGTON – As the Pentagon has sought to sell wars in Iraq and Afghanistan to often-hostile populations there, it has spent hundreds of millions of dollars on poorly tracked marketing and propaganda campaigns that military leaders like to call “information operations,” the modern equivalent of psychological warfare. May 18, 2012: My former colleague Michael Hastings publishes a piece in now-defunct Buzzfeed, titled, “Congressmen Seek to Lift Propaganda Ban: Propaganda that was supposed to target foreigners could now be aimed at Americans, reversing a longstanding policy.” Hastings would prove prescient: The amendment would “strike the current ban on domestic dissemination” of propaganda material produced by the State Department and the independent Broadcasting Board of Governors, according to the summary of the law at the House Rules Committee’s official website.  The late Michael Hastings. January 2, 2014: CNN’S Jake Tapper notes, accurately: “the Obama administration has used the Espionage Act to go after whistleblowers who leaked to journalists ... more than all previous administrations combined.”  November 16, 2018: President Donald Trump signs into law the “Cybersecurity and Infrastructure Security Agency Act of 2018” establishing CISA as a subagency within Department of Homeland Security with a multibillion dollar budget.  November 17, 2020: Inaugural CISA Director Christopher Krebs is fired by President Trump via tweet for remarks he made about the security of the presidential election.  Trump’s dismissal-by-tweet of the first CISA chief. May 18, 2022: The Department of Homeland Security’s ill-fated “Disinformation Governance Board” is “paused” after just three weeks. Papers like the Washington Post blame “right-wing attacks” for its closure. Sept 08, 2022: The RAND Corporation publishes “INFORMATION WARFARE: Methods to Counter Disinformation” which advocates “developing counter-strategies and we specifically identify the concept of kill chains as a useful framework to assist in the disinformation challenge,” essentially incorporating the assassination doctrine of JSOC in Iraq and Afghanistan to domestic publications.  December 2, 2022: Twitter Files #1 is published, beginning a series of reports that will disclose wide-ranging “anti-disinformation” efforts under the Departments of State and Homeland Security, in addition to the FBI, the Office of the Director of National Intelligence, and an as-yet-undetermined number of civil society organizations. Tyler Durden Fri, 05/19/2023 - 15:25.....»»

Christie said no Republican can beat Trump in the primaries "by playing footsie with him and pretending that you're almost like him." Former Gov. Chris Christie of New Jersey speaks during a town hall-style meeting at New England College in Henniker, New Hampshire, on April 20, 2023.AP Photo/Charles Krupa Chris Christie said there's only "one lane" for the GOP if they want to beat Trump in the primaries. "I'm going to tell people the facts about his presidency," he said in New Hampshire, according to The New York Times. In describing a potential Trump second term, Christie said "the reruns will be worse than the original show." After a failed White House bid in 2016, former Gov. Chris Christie of New Jersey is testing the presidential waters once again — and he's focusing his fire at onetime political ally former President Donald Trump.Unlike some of the current and potential GOP presidential candidates, who are attempting to thread the needle by calling for new leadership while also praising Trump's policies, Christie is making the case for his own potential candidacy with explicit critiques of the former president's conduct during his single term in office.During a swing in critical New Hampshire, Christie warned Republican voters against renominating Trump in 2024."Donald Trump is a TV star. Nothing more, nothing less," Christie told a crowd, according to The New York Times. "And let me suggest to you that if we put it back to the White House, the reruns will be worse than the original show.""I don't think that anybody is going to beat Donald Trump by sidling up to him, playing footsie with him and pretending that you're almost like him," he continued. "I'm going to tell people the facts about his presidency and about his conduct. If they decide they want that again, that's up to them."(However, when Christie was asked if he would have backed Trump against former Secretary of State Hillary Clinton in the 2016 presidential election knowing what would happen in the aftermath of the 2020 election, the ex-governor said he still would have voted for him, per The Times.)Christie also made it clear that there was only one way to defeat Trump in the GOP primaries."I think there's this fiction about lanes," he said while speaking with potential primary voters. "There is one lane, OK? There are not multiple lanes. At the front of that lane right now is Donald Trump.""If you want to win the Republican nomination for president, you have to beat Donald Trump and get to the front of that lane," he added.Despite the sweeping criticism, Christie is no stranger to Trumpworld.Following Christie's poor performances in both the Iowa caucus and the New Hampshire primary in 2016, he suspended his campaign and threw his support behind Trump, which at the time was a major boost to the the first-time candidate's presidential bid.After Trump defeated Clinton that fall, Christie was reportedly offered multiple roles in the administration, including the cabinet posts of homeland security secretary and labor secretary, but he ultimately chose to serve out the rest of his second term as governor after then-Sen. Jeff Sessions of Alabama was tapped to become attorney general — which was the role that he had been eyeing.In 2020, Christie helped Trump prepare for his first debate with then-Democratic presidential nominee Joe Biden, but after the Capitol riot on January 6, 2021, he criticized the then-president over the siege, which was sparked by pro-Trump supporters incensed over the certification of Biden's electoral victory.However, just months later, Christie said he'd give Trump an "A" grade for the policies he was able to enact while in the White House.While speaking in New Hampshire this week, Christie broached the topic of January 6 once again and blasted Trump over his response to the mayhem that day, per The Times."When he saw that, you know what he did?" the former governor said of Trump watching the riot unfold on television. "He ate his well-done cheeseburger, and sat there and did nothing."Read the original article on Business Insider.....»»

Western countries are sending "a lot" of surface-to-air missiles to Ukraine, but Ukrainians have to use them "constantly," a US general said in March. Polish MIG-29 fighter jets during a NATO shielding exercise over Poland in October 2022.Omar Marques/Getty Images Poland received permission from Germany to send Ukraine five more MiG-29s this week. The jets will bolster Ukraine's fighter fleet, which is still under fire from Russia's larger air force. But air-defense ammunition is a more urgent need, one underscored in recently leaked US documents. Poland received permission from Germany to send five MiG-29 fighter jets to Ukraine this week, bolstering Kyiv's fleet ahead of a season of more intense fighting.The jets, however, won't tip the scales in the aerial battle between Russia and Ukraine, and they will arrive as Ukraine and its partners scramble to find more ammunition for Ukrainian air-defense weapons, which have been vital to denying Russia's aircraft and missiles the ability to strike at will.Berlin approved Warsaw's request to send jets to Ukraine on Thursday, the same day it was received. Poland acquired 22 MiG-29s, which had been part of the East German military, from Germany in 2003 with the requirement that the Germans approve any future transfers.Poland and Slovakia pledged to send roughly two dozen MiG-29s to Ukraine in March. At the time, Poland's president said the first four jets would be delivered within days, and Ukrainian officials said in late March that the first Slovakian jets were already in combat around Kharkiv.A Ukrainian pilot exits a MiG-29 at an airbase outside of Kyiv in November 2016.Danil Shamkin/NurPhoto via Getty ImagesThe MiG-29s will give Kyiv an airpower boost and be familiar to pilots with experience on Ukraine's own MiGs, but Russian and Ukrainian jets remain of limited use over the battlefield, as each side has air-defense weapons that have prevented the other from achieving air superiority."Their integrated air- and missile-defense is working pretty well, to the point where they're shooting down [each] other's aircraft," Gen. James Hecker, the commander of US Air Forces in Europe, said at an event hosted by the Mitchell Institute for Aerospace Studies on March 22.Having more jets "is going to help" the Ukrainians, Hecker said. "This will allow them to come at different axes, which will complicate the problem that Russia has.""Is that going to be the enabler that's going to let them get air superiority? No, I don't think so, not anytime soon," Hecker added. "The integrated air- and [missile-defense] system that both Ukraine as well as Russia have is very extensive, and it would be difficult from a US perspective to take all that down in a couple days."Ukraine started the war with a smaller, less advanced air force than Russia and has lost more than 60 aircraft, while Russia has lost more than 70, Hecker said at a separate event in early March. Both air forces have shifted tactics and now operate farther from the front line, playing to the advantage of the Russian aircraft, which have an edge at longer ranges.A Russian Su-25 ground-attack jet fires rockets on a mission in Ukraine in July 2022.Russian Defense Ministry Press Service via APUkraine has also adopted US-made weapons, including anti-radiation missiles that have helped suppress Russian surface-to-air missiles and extended-range bomb kits that have had "some success," Hecker said on March 22.Ukrainian officials have requested more advanced jets like the US-made F-16, arguing they will give Ukrainian pilots an advantage. US officials have said repeatedly that it would be too costly and time-consuming for Ukraine's air force to adopt those jets and that other weapons are more immediately useful, particularly air-defense systems, which both Ukrainian and Western officials have cited as one of their highest priorities.According to classified US Defense Department documents leaked online in recent weeks, US officials believe that Kyiv is at risk of running out of air-defense weapons and ammunition by late spring or early summer, leaving important targets exposed to Russian attacks.Ukraine's current air-defense plan "balances limited resources to protect critical national infrastructure (CNI), population centers, front line of troops (FLOT), and other key assets," according to a summary on one document, which has markings that indicate it was prepared on February 23 and was classified top secret. Insider obtained a copy of it and other documents but could not independently verify their authenticity.Ukraine's "ability to provide medium range air defense to protect the FLOT will be completely reduced by MAY 23," the summary says. A detailed assessment included in the document said Soviet-designed Buk and S-300 systems compose 89% of Ukraine's defenses for targets above 20,000 feet and that based on expenditure rates at the time, the Buks would be expended by March 31 and S-300s by May 2.Other systems, such as older Soviet-era SA-3s or Western-provided NASAMs, are limited in number and "unable to match" the volume of attacks.Ukrainian soldiers rush to an S-300 air-defense missile station during training near Sevastopol in July 1995.VALERY SOLOVJEV/AFP via Getty ImagesShort-range air-defense weapons provided by Western countries, like Stinger missiles or the Gepard cannon, "mitigate the expenditure" of other surface-to-air missiles but "do not have the same deterrent effect" on Russian aircraft. Ukraine also has "limited to no" air-to-air defense, the document says.Without the threat posed by those interceptor missiles, Russian aircraft would have greater freedom to attack Ukrainian aircraft and bomb Ukrainian targets, including in support of Russian front-line troops, the leaked document says. Russia's long-range missiles could also be more accurate, as they would no longer have to dodge air defenses, and the Russian military could expand the type of munitions it is using and conduct a greater range of aerial operations, further challenging Ukraine's ability to mass forces to conduct attacks.The document suggests several courses of action, including resupplying Buk and S-300 missiles over the following three months and restricting their usage to Russian tactical aircraft. The document also suggests "military deception" and adjusting firing doctrine to counter Russian aerial attacks more effectively.The document further recommends over a three- to six-month period providing more Western-made air-defense systems, like Patriots, and expediting work on something called the "FrankenSAM," which may refer to a modification of an existing weapon or weapons.The document echoes many of the warnings by Western officials and experts, who have cautioned that without sufficient air-defense ammunition, Ukrainian infrastructure would be more vulnerable, its forces more exposed, and Russia's military more free to use its aircraft and gather its forces for renewed attacks.A Ukrainian soldier next to an anti-aircraft battery near Bakhmut on March 30.Diego Herrera Carcedo/Anadolu Agency via Getty ImagesWestern countries have made air-defense ammunition a focus of recent security-assistance efforts, a reflection of broader efforts to support Ukraine ahead of an expected counteroffensive in the spring and summer.On March 15, nearly 50 countries participated in the 10th meeting of the Ukraine Defense Contact Group, during which air-defense systems were a major point of discussion. "A broad mix of air-defense systems have been promised, and they will protect the skies over Kyiv and the free cities of Ukraine," Gen. Mark Milley, chairman of the Joint Chiefs of Staff, said after the meeting.On April 4, the US announced a $2.6 billion package of security aid for Ukraine that included ammunition for the Patriot system the US provided in December, which will come from existing US stockpiles, as well as ammunition for NASAMs, gun trucks and laser-guided rockets to shoot down drones, anti-aircraft ammunition, and air-surveillance radars, which will be ordered from the US defense industry and take longer to deliver.The dozens of countries at the Contact Group meeting "responded" to the challenge and were able to provide "a lot more surface-to-air missiles" to Ukrainian forces, Hecker said on March 22, "but it's something that they're using constantly because of the tactics that the Russians are using."Read the original article on Business Insider.....»»