Today’s News 11th January 2023

• The Digitization Of Humanity Shows Why The Globalist Agenda Is Evil
  The Digitization Of Humanity Shows Why The Globalist Agenda Is Evil

  Authored by Brandon Smith via Alt-Market.us,

  In recent weeks I’ve been seeing an interesting narrative fallacy being sold to the general public when it comes to the designs of globalists. The mainstream media and others are now openly suggesting that it’s actually okay to be opposed to certain aspects of groups like the World Economic Forum. They give you permission to be concerned, just don’t dare call it conspiracy.

  

  This propaganda is a deviation from the abject denials we’re accustomed to hearing in the Liberty Movement for the past decade or more. We have all been confronted with the usual cognitive dissonance – The claims that globalist groups “just sit around talking about boring economic issues” and nothing they do has any bearing on global politics or your everyday life. In some cases we were even told that these groups of elites “don’t exist”.

  Now, the media is admitting that yes, perhaps the globalists do have more than just a little influence over governments, social policies and economic outcomes. But, what the mainstream doesn’t like is the assertion that globalists have nefarious or authoritarian intentions. That’s just crazy tinfoil hat talk, right?

  The reason for the narrative shift is obvious. Far too many people witnessed the true globalist agenda in action during the pandemic lockdowns and now they see the conspiracy for what it is. The globalists, in turn, seem to have been shocked to discover many millions of people in opposition to the mandates and the refusals to comply were clearly far greater than they expected. They are still trying to push their brand of covid fear, but the cat is out of the bag now.

  They failed to get what they wanted in the west, which was a perpetual Chinese-style medical tyranny with vaccine passports as the norm. So, the globalist strategy has changed and they are seeking to adapt. They admit to a certain level of influence, but they pretend as if they are benevolent or indifferent.

  The response to this lie is relatively straightforward. I could point out how Klaus Schwab of the WEF savored the thrill of the initial pandemic outbreak and declared that covid was the perfect “opportunity” to initiate what the WEF calls the “Great Reset.”

  I could also point out that Klaus Schwab’s vision of the Reset, what he calls the “4th Industrial Revolution”, is a veritable nightmare world in which Artificial Intelligence runs everything, society is condensed into digital enclaves called “smart cities” and people are oppressed by carbon taxation. I could point out that the WEF actively supports the concept of the “Shared Economy” in which you will “own nothing, have no privacy” and you will supposedly be happy about it, but only because you won’t have any other choice.

  What I really want to talk about, however, is the process by which the elites hope to achieve their dystopian epoch, as well as the globalist mindset which lends itself to the horrors of technocracy. The common naive assumption among skeptics of conspiracy is that the globalists are regular human beings with the same drives and limited desires as the rest of us. They might have some power, but world events are still random and certainly not controlled.

  This is a fallacy. The globalists are not like us. They are not human. Or, I should say, they despise humanity and seek to do away with it. And, because of this, they have entirely different aspirations compared to the majority of us which include aspirations of dominance.

  What we are dealing with here are not normal people with conscience, ethics or empathy. Their behavior is much more akin to higher functioning psychopaths and sociopaths rather than the everyday person on the street. We saw this on full display during the covid lockdowns and the vicious attempts to enforce vaccine passports; their actions betray their long game.

  Take a look at comments by New Zealand’s prime minister and WEF attendee, Jacinda Ardern, from a year ago. She admits to the deliberate tactic of creating a two-tier class system within her own country based on vaccination status. There is no remorse or guilt in her demeanor, she is proud of taking such authoritarian actions despite numerous studies that prove the mandates are ineffective.

  Beyond the covid response, though, I suggest people who deny globalist conspiracy take a deeper dive into the philosophical roots of organizations like the WEF. Their entire ideology can be summed up in a couple words – Futurism and godhood.

  Futurism is an ideological movement which believes that all “new” innovations, social or technological, should supplant the previous existing systems for the sake of progress. They believe that all old ways of thinking, including notions of principles, heritage, religious belief systems, codes of conduct, etc. are crutches holding humanity back from greatness.

  But what is the greatness the futurists seek? As mentioned above, they want godhood. An era in which the natural world and human will is enslaved by the hands of a select few. Case in point – The following presentation from 2018 by WEF “guru” Yuval Harari on the future of humanity as the globalists see it:

  Harari’s conclusions are rooted in elitist biases and ignore numerous psychological and social realities, but we can set those aside for a moment and examine his basic premise that humanity as we know it will no longer exist in the next century because of “digital evolution” and “human hacking.”

  The foundation of the WEF vision is built on the idea that data is the new Holy Grail, the new conquest. This is something I have written about extensively in the past (check out my article ‘Artificial Intelligence: A Secular Look At The Digital Antichrist’) but it is good to see it expressed with such arrogance by someone like Harari because it is undeniable evidence – The globalists think they are going to build a completely centralized economy and society based on human data rather than production. In other words, YOU become the product. The average citizen, your thoughts and your behaviors, become the stock in trade.

  Globalists also believe that data is most valuable because it can be exploited to control people’s behaviors, to hack the body and mind in order to create human puppets, or create super-beings. They dream of becoming little gods with omnipotent knowledge. Yuval even proudly proclaims that intelligent design will no longer be the realm of God in heaven, but of the new digitized man.

  While Harari pays lip service to “democracy” vs “digital dictatorship”, he goes on to assert that centralization may become the defacto system of governance. He says this not because he fears dictatorship, but because that has always been the WEF’s intent. The globalist argues that governments cannot be trusted to hold a monopoly on the digital wellspring and that someone needs to step in to regulate data; but “who would do this?”, he asks.

  He already knows the answer. The UN, a globalist edifice, has consistently said it should be the governing body that takes control of AI and data regulation through UNESCO. That is to say, Harari is playing coy, he knows that the people who will step in to control the data are people just like him.

  At no point in Harari’s speech does he suggest that that any of these developments should be obstructed or stopped. At no point does he offer the idea that the digitization of humanity is wrong and that there are other better ways of living. He actually mocks the concept of “going back” to old ways; only the future and the Tabula Rasa (blank slate) hold promise for the globalists, everything else is an impediment to their designs.

  But here’s the thing, what the globalists are trying to accomplish is a fantasy. People are not algorithms, despite how much Harari would like them to be. People have habits, yes, but they are also unpredictable and are prone to sudden awakenings and epiphanies in the moment of crisis.

  Psychopaths tend to be robotic people, acting impulsively but also very predictably. They lack imagination, intuition and foresight, and so it’s not surprising that organizations of psychopaths like the WEF would place such an obsessive value on AI, algorithms and a cold technocratic evolution. They don’t view their data Shangri-La as humanity’s future; they see it as THEIR future – The future of the non-humans, or the anti-humans as it were.

  Who will produce all the goods, services and necessities required in this brave new world? Well, all of us peons, of course. Sure, the globalists will offer grand promises of a robot driven production economy in which people no longer need to engage in menial labor, but this will be another lie. They’ll still need people to plant the crops, maintain infrastructure, take care of manufacturing, do their fighting for them, etc., they’ll just need less of us.

  At bottom, an economy built on data is an economy dependent on illusion.

  Data is vaporous and oftentimes meaningless because it is subject to the biases of the interpreter. Algorithms can also be programmed to the biases of the engineers. There is nothing inherently objective about data – it is all dependent on the intentions of the people analyzing it.

  For example, to use Harari’s anecdote of an algorithm that “knows you are gay” before you do; any twisted group of people could simply write code for an algorithm that tells the majority of easily manipulated kids that they are gay, even when they are not. And, if you are gullible enough to believe the algorithm is infallible, then you could be led to believe that numerous falsehoods are true and be convinced to behave against your nature. You have allowed a biased digital phantom to dictate your identity, and have made yourself “hackable.”

  In the meantime, the elitists entertain delusions of surpassing their mortal limitations by “hacking” the human body, as well as reading the minds of the masses and predicting the future based on data trends. This is an obsession which ignores the unpredictable wages of the human soul, that very element of conscience and of imagination which psychopaths lack. It’s something that cannot be hacked.

  The legitimacy of the data based system and the hacking of humanity that the WEF aspires to is less important than what the masses can be convinced of. If the average person can be persuaded to implant their cell phone in their skull in the near future, then yes, humanity might become hackable in a rudimentary way.

  The algorithms then supplant conscience, empathy and principles.  And, without these things all morality becomes relative by default.  Evil becomes good, and good becomes evil. 

  By the same token, if humanity can be persuaded to set down their cell phones and live a less tech focused life, then the digital empire of the globalists comes crashing down quite easily. There is no system the elites can impose that would make their digital consciousness a reality without the consent of the public at large.

  Without a vast global framework in which people willingly embrace the algorithms rather than their own experience and intuitions, the globalist religion of total centralization dies. The first step is to accept that the conspiracy does indeed exist. The second step is to accept that the conspiracy is malicious and destructive. The third step is to refuse to comply, by whatever means necessary.

  *  *  *

  If you would like to support the work that Alt-Market does while also receiving content on advanced tactics for defeating the globalist agenda, subscribe to our exclusive newsletter The Wild Bunch Dispatch.  Learn more about it HERE.

  Tyler Durden
  Wed, 01/11/2023 – 00:05

• Australia Denies Asylum To Defecting Chinese Spy Wang Liqiang
  Australia Denies Asylum To Defecting Chinese Spy Wang Liqiang

  Authored by Cindy Zhan via The Epoch Times (emphasis ours),

  Wang Liqiang, who publicly defected from Beijing on Australian national television, has been denied asylum.

  

  The Administrative Appeals Tribunal (AAT) said Wang could not be granted refugee status despite having “well-founded” concerns about returning to China because he committed fraud before entering Australia on a tourist visa, The Daily Telegraph reported.

  The AAT also doubted Wang’s espionage claims and questioned how it could “safely find that (Wang) was engaged in espionage ­activities.”

  Wang defected to Australia in 2019 and provided an unprecedented account of the Chinese Communist Party’s (CCP) influence operations overseas.

  In an interview with The Epoch Times, the then 27-year-old talked about how he had become disillusioned by the CCP’s totalitarian agenda which led to his decision.

  “As I grew older and my worldview changed, I gradually realised the damage that the CCP’s authoritarianism was doing to democracy and human rights around the world,” Wang, the first Chinese spy to go public with his identity, said.

  “My opposition to the Party and communism became ever-clearer, so I made plans to leave this organisation.”

  

  “I thought and rethought it time and time again,” he said. “I wondered if this decision would be a good thing or a bad thing for my life. I couldn’t tell you definitively, but I firmly believe that if I had stayed with [the CCP], I would come to no good end.”

  The Australian Department of Home Affairs rejected Wang’s asylum application over an alleged fraud committed against Sydney businessman Filip Shu.

  Wang now faces potential deportation back to China.

  Espionage in Hong Kong and Taiwan

  “My jaw dropped as I read Wang’s 12-page Chinese-language confession and plea for help,” wrote Alex Joske, a former analyst at the Australian Strategic Policy Institute.

  Other than admitting to being a CCP agent, Wang also disclosed to Australian immigration officials the communist regime’s espionage activities in Hong Kong and Taiwan.

  During 2018, Wang admitted to coordinating a mass disinformation campaign targeting “nine-in-one” regional elections in Taiwan aimed at undermining the administration of Taiwan President Tsai Ing-wen. He travelled to Taiwan on a forged South Korean passport, where he took part in coordinating on-the-ground operations, he told Nine Network newspapers in 2019.

  Wang also said he was sent to Hong Kong, where he infiltrated universities and stole military and weapons intelligence, all on the orders of his CCP superiors.

  Wang provided the Australian Security Intelligence Organisation (ASIO) with a detailed account of everything he knew, including his role in the kidnapping of Causeway Bay bookstore owner Li in Hong Kong.

  Further, he claimed he secretly met with the head of the CCP’s spy operations in Australia, saying the man worked in the country’s energy sector.

  

  In a rare move, the CCP’s Political and Legal Affairs Commission responded swiftly to Wang Liqiang’s case after he went public saying Wang was unemployed and had been convicted of fraud.

  Wang said he had anticipated the CCP’s defamation campaign against him and, through his lawyer, refuted the claims saying he had given a sworn statement to the Australian government and that he was aware of the serious consequences of making false accounts.

  ‘Real and Chilling Impact’: Former Senator

  The denial of Wang’s asylum triggered concerns over the trial’s decision.

  Eric Abetz, a former Liberal senator for Tasmania, said he hoped due process was followed.

  “It would indeed be a sad and worrying outcome should genuine defectors not be assisted. This would have a very real and chilling impact if protection was not granted,” he told The Epoch Times in an email.

  “One must assume the decision to deport was made on legitimate grounds and not influenced by other considerations.”

  

  Policymakers from both major parties in Australia supported granting asylum to Wang Liqiang in 2019.

  Current Australian Prime Minister Anthony Albanese said back then that Wang might have a “legitimate claim for asylum.”

  “We know that he has outlined a range of activities which clearly put him in a circumstance whereby it’s a legitimate claim for asylum,” said Albanese, then opposition leader.

  Liberal MP Shadow Minister for Defence Andrew Hastie also supported granting Wang asylum.

  “I’m of the view that anyone who’s willing to assist us in defending our sovereignty deserves our protection,” Hastie, who chaired the Joint Committee on Intelligence and Security, said at the time. “I think he deserves our protection and our support.”

  ‘Setting a Very Bad Precedent’: Australian Chinese Writer

  Jennifer Zeng, an Australian Chinese writer, and YouTuber focusing on Chinese politics, said the CCP would definitely exert pressure on the Australian government on such matters, particularly as the Labor government works to normalise ties with Beijing.

  During the pandemic, Beijing launched a comprehensive trade war against Australian exporters in response to calls for an investigation into the origins of COVID-19 by former Prime Minister Scott Morrison.

  Meanwhile, Zeng, who applied for asylum in Australia in 2001, cited her own experience of the CCP exerting pressure on Home Affairs during her asylum application.

  

  “Wang’s repatriation will set a very bad precedent for the future,” she told The Epoch Times in an interview. “It will discourage other defectors, including those who know other secrets in the CCP system, such as the secret of forced organ harvesting … They will lose trust in Western governments.”

  “The CCP punishes those who betray themselves very severely. They are ruthless in dealing with the so-called traitors … If that [the deportation] were to happen, it would be very regrettable and would make the free world, including the Chinese people in China who yearn for freedom, very disappointed with the Australian government.”

  The denial of Wang’s asylum comes after Foreign Minister Penny Wong visited China on Dec. 21, wishing to restart Australian exports to Beijing after years of diplomatic tension with the previous Liberal government.

  Chinese Ambassador to Australia Xiao Qian said on Jan. 10 that Wong’s visit helped restart bilateral discussions on trade, economics, and investment. Xiao thanked the Albanese government and Australian media for sending “positive messages” to the public.

  

  Zeng, who currently lives in the United States, hopes that the U.S. government can step in and offer Wang asylum to avoid deportation to China.

  “Anything that is good for the Western free world and those who aspire to it, especially those in the CCP system, we should welcome them, support them, and help them,” she said.

  Both the Administrative Appeals Tribunal and the Department of Home Affairs told The Epoch Times that they were not able to comment on the case.

  Tyler Durden
  Tue, 01/10/2023 – 23:45

• Jordan Peterson: Enemy Of The State
  Jordan Peterson: Enemy Of The State

  Authored by Jeffrey Tucker via The Brownstone Institute,

  The famed psychologist and scholar, and global media personality, Jordan Peterson is being told that he must report to the Ontario College of Psychologists for re-education or else lose his license to practice. He is challenging the order in court, for whatever that’s worth.

  

  No question that this follows his aggressive questioning of the whole of the Covidian agenda, including mass forced vaccination of the population.

  It’s hardly the first time he has gotten in trouble with the powers that be. His initial fame came from his brave refusal to acquiesce to the “preferred pronoun” movement in Canada that came before lockdowns. That he is now ensnared in the machinery of the biomedical security state is predictable; this is today’s means by which regime enemies are punished and silenced.

  It so happens that I heard Jordan speak in Budapest only months before the lockdowns that coincided with his own grave problem that he encountered with prescription medicine: as with many he was misled about what he believed was a simple medication. The timing was a tragedy because it took him out of the space of public intellectual life right when we needed him most: during the early months of lockdowns.

  His voice went silent during these times. It was heartbreaking. The very small resistance continued despite his incapacitation. Once he got better, he gradually became aware of what had taken place and then became ferocious, as any thinking person must. Thus his current issues with the authorities.

  Looking back at this date, it seems almost like he saw what was coming. In those months before lockdowns, I wrote the following report on what I saw in Budapest.

  *  *  *

  Almost from the first words of his outdoor lecture in Budapest, Hungary, held in the courtyard of the St. Stephen’s Basilica, Jordan Peterson’s eyes teared up and his voice cracked with emotion. Not just once. It happened repeatedly. His eyes never entirely dried. The audience could see it all because of the cameras and the huge monitors that made him some 25 times life-size, which is pretty apropos to his status as an intellectual in this part of the world. Indeed, in most parts of the world.

  Tonight was interesting, however, because his tears were clearly not performative in any sense. It was a show of extreme vulnerability that he surely hoped that he would not show. He strikes me as a deeply emotional person—a temperamental cryer—who has probably practiced a lifetime to stop this.

  It didn’t work this time. Before long, during his impassioned presentation on behalf of the dignity of every individual and the responsibility of living a life of truth, audience members too were tearing up in the midst of the awesome silence that fell over this massive crowd during the hour-long presentation.

  He never quite got around to explaining his emotion. I think I can, however. So here is my go at it.

  The first issue had to do with his introduction in this hugely dramatic space, which was filled with flares and fanfare and oceans of love from those who gathered, not just people with tickets (which were hard to get) but an equal number behind the barricades, extending as far back as one could see. It was impossible not to view this as a show of incredible affection for the man, his work, his influence, his personal courage, and his message. The crowds and the anticipation were overwhelming.

  Now, if you are Peterson, you would have to contrast this scene with the raging nonsense you will read about yourself in the mainstream press, to say nothing of the academic literature along with various left-wing hit sites out there who routinely twist anyone’s words to confirm their wild narratives. His every word is picked apart, his footnotes followed, his analogies deconstructed in an unending game of gotcha in order to put him into some kind of predefined political category for easy dismissal.

  For the easily led, he is a target. For the witch hunters in media and academia, he is a convenient scapegoat. Within the academy, he is the object of unrelenting envy. In the face of all this, including campus protests and media hectoring, he has been steadfast and brave, refusing to be intimidated and instead using the attention to get his message out there. To cut through all this nonsense, and like and appreciate him in any case, already marks you as being in possession of a discerning mind, a rebel against conventional wisdom. Apparently, there is no shortage of such rebels.

  The crowds—I don’t have an estimate but there were 20,000 people at the Brain Bar event at which he was a main draw—might have seemed to him as a tribute to the resiliency of the human spirit. That people were there at all, seeking not a confirmation of political bias but rather to gain a greater sense of personal purpose, shows that the powerful in this world cannot finally rule the day.

  He is just one man with a message against the world’s most powerful voices in media, academia, and government—and yet through ideas alone, beginning as nothing but one man in a classroom, he has become the world’s most influential public intellectual.

  As for his emotion this night, Jordan probably felt a deep sense of gratitude for being the recipient of this affection and for his place in inspiring people to become intellectual dissidents. That is enough to cause tears of gratitude.

  There is far more that overwhelms you about being in this remarkable and indescribably beautiful city. The history is deep and rich and present everywhere you look. There is drama within eyesight of anywhere you stand. The Danube river and bridges, the castles, the stunning Parliament building, the churches and universities, all of it, are not dusty old monuments but currently in use amidst a teeming commercial life that is equal parts old and new.

  The whole city also feels extremely young, similarly today to what it might have been like in the late 19th century, in the last years of the Belle Époque when Budapest’s cultural and commercial life rivaled Vienna’s. It’s a magical place, as delightful to visit as anywhere on the planet, in my view.

  But what you see is only on the surface. The scars of this city are extremely deep, having been put through astonishing traumas of totalitarianism of the left and right, the bombings, the terror and cruelty and poverty—the experience is not that far back in history. It was tyrannized by Soviet occupation twice, first after World War I and then following World War II, between which it experienced Nazi occupation and devastating Allied bombing that destroyed its infrastructure (all of which has since been rebuilt).

  And yet you can walk the city and not see this deep suffering overtly. The city, which wears this grim past lightly, is a tribute to the survival of hope in the face of overwhelming forces that sought to destroy it. The city lives. It thrives. It dreams anew.

  In addition to being a psychologist, Peterson is also a historian of totalitarianism. There are ways to read history as a dry reportage of events. That is not how he reads history. Good historians recount events. Great historians tell stories as if they lived them. Peterson is next level: he has sought the inner philosophical and psychological turmoil that shape history through the moral choices of both the oppressed and oppressors. He seeks to understand the inner horror from the point of view of human nature.

  As he exclaimed in a slightly terrifying moment, he has read about the history of Hungary and totalitarianism “not as a victim, not as a hero, but as a perpetrator.” What he means is that we must come to terms with evil not just as something external to ourselves but as a force deep within the human personality itself—not excluding our own personalities. What character traits do we need to acquire, what values do we need to adopt, that can prepare us to resist when evil invites our participation in violence and terror? He never stops reminding us what we are capable of doing both good and evil, and urges that we steel ourselves to live good lives even when it is not in our political and economic interests to do so.

  So here we were in St. Stephen’s square outside the great Basilica, packed with young people there to hear his message, in this remarkable city, a tribute to the resiliency of the human personality in the presence of one hundred years of oppression and violence. And yet there we were in this year, an age of hope, everyone given yet another chance to get it right, to live well, to treat others with dignity, to build peace and prosperity yet again.

  The look on his face, and tears in his eyes, seem to suggest to himself and others: we can do this. We will not give in to evil. We can be strong. We can learn, build, and achieve. Against all odds, he has emerged as a leading voice to add to the possibility of success in our times.

  I’ve heard Peterson live before and, like you, watched many of his speeches and interviews on YouTube. I can tell you, I’ve never heard anything like what he said on this evening. It was for the ages.

  The latter part of his presentation was lighter, with some very charming “one-minute therapy” sessions on stage with audience members that variously turned profound once again. And here is what is amazing: you discover that the real core of Peterson is not his political outlook or his role as a cultural pundit, historian, or philosopher but his professional training as a psychotherapist, just one man there to help one individual find a way forward through the terrifying struggles of life. Through technology, he finds himself in the blessed role of serving millions of willing readers and listeners.

  Even now he can’t possibly know the full impact of his influence. I suspect, for example, that he is unaware of the crucial role he played in American political life when only two years ago, young men were being drawn to the invidious politics of the so-called alt-right as an alternative to the false moralism of the social-justice left. They were drawn to his brave stances against speech controls, but he knew better than to side with any mob on either side of the extremes. He schooled even his new fans in the evils of every brand of identity politics—and the moral urgency of universal human dignity—and justly earned the wrath of alt-right leadership. Thus did he contribute to saving a generation from perdition in extremely volatile times. For this, he deserves the gratitude of every genuine liberal, but, so far as I know, he has never been publicly credited for this achievement.

  “Ego Sum Via Veritas et Vita,” read the sign above the entrance to the Basilica. I am the way, the truth, and the life. The sign reminds us of the universal hunger to find direction, purpose, meaning, and redemption in the midst of the chaos and anomy of the historical narrative.

  Peterson is not a religious man but he respects its ethos and contribution. This night he became a preacher of goodness, of civility, of moral strength in the face of struggle. The poetry of it all, and the promise that goodness and decency can prevail, was manifest in the crowds and the city right here, this night, in Budapest. It combined to inspire him to find the fullness of his voice.

  And this is why he cried tears of joy.

  *  *  *

  Soon after this presentation, Peterson was in the hospital in recovery at the same time the world of freedom and rights fell apart. He woke to a different world. He began to fight again. And here we are, exactly as he predicted: he is the enemy of the state. He has spent his entire professional career not only as a scholar and therapist—really a genius—but also as a resistor and a bringer of light in dark times.

  Tyler Durden
  Tue, 01/10/2023 – 23:25

• The (Surprisingly High) Cost Of Mobile Internet Around The World
  The (Surprisingly High) Cost Of Mobile Internet Around The World

  Israel has the cheapest mobile internet in the world, with one gigabyte of data costing on average just $0.04 in 2022. With three in four Israelis owning a smartphone, the country has an even higher smartphone penetration than the United States.

  This is according to UK-based price comparison website cable.co.uk, who analyzed 5,292 mobile data plans across 233 countries.

  As Statista’s Anna Fleck shows in the chart below, Italy places second in the global ranking, with a low cost of $0.12 per 1GB. The country has excellent internet infrastructure with 5G now available to around 95 percent of its residents. It also maintains the internet of neighboring San Marino ($0.14), which places third in the global ranking.

  

  You will find more infographics at Statista

  According to Dan Howdle, a consumer telecoms analyst at cable.co.uk, many of the cheapest countries have excellent mobile and fixed broadband infrastructure which allows providers to offer large amounts of data at cheap prices.

  In some countries, economic conditions dictate the price which has to remain low so people can afford it.

  Some of the costliest data plans, however, are in the remote island nations of Africa and South America. For instance, the Falkland Islands rank in 231st place with 1GB of internet costing $38.45, while the same amount of mobile data in Saint Helena, a British Overseas Territory located in the South Atlantic, costs an average of $41.06 – more than 1,000 times that of Israel’s.

  Regionally, North America is the most expensive overall, with an average cost of $4.98 per GB, which is higher than the global average of $3.12.

  Canada is the most expensive of the region ($5.94), followed by the United States ($5.94), while Greenland is the cheapest ($3.36).

  Tyler Durden
  Tue, 01/10/2023 – 23:05

• A Day In The Life: Southern California's Fentanyl Crisis
  A Day In The Life: Southern California’s Fentanyl Crisis

  Authored by John Fredricks via The Epoch Times,

  “I don’t even know if I will be alive tomorrow. I might OD tonight,” Pete—a pseudonym—told The Epoch Times.

  “You are talking to a drug user right now and that’s the name of the game.”

  

  The 34-year-old comedian has been using the opiate fentanyl since the emergence of the coronavirus pandemic and commonly checks in and out of rehabilitation centers. With his addiction, he wakes up some mornings homeless on the streets of Southern California.

  “You are talking on the phone to a guy about to get his drugs right now,” he said slurring his words off of Huntington Beach’s 17th Street. “And you just missed me getting shaken down by some guy over here.”

  

  A homeless man contorts his body while working off a drug high in Santa Ana, Calif., on June 28, 2022. (John Fredricks/The Epoch Times)

  The “guy” Pete was referencing, a drug dealer, did not give Pete the drugs he wanted. Instead, he paid a nearby homeless individual $80 to help him track down a dealer.

  “I would say that the easiest cities to get [fentanyl] in Orange County would be either Costa Mesa or Santa Ana,” Pete said the morning after being arrested for public drunkenness by Newport Beach Police.

  “You can ask any homeless person and they can tell you where to find fentanyl to inject or smoke,” he said.

  Dealers which are nicknamed “Fentanyl Fairies” blend in with local homeless populations, even sometimes pushing shopping carts that appear to be filled with their belongings.

  There’s a “connection with homelessness and fentanyl,” Pete said.

  “When you are selling everything to feed your own addiction, you become homeless. Dealers look homeless and sell to the homeless.”

  A Record Year

  As 2022 came to a close, the U.S. Drug Enforcement Agency announced a record-breaking seizure of over 379 million deadly doses of fentanyl throughout the country.

  United States Customs and Border Protection agents also faced their busiest year on record regarding fentanyl seizures. According to the Department of Justice, 60 percent of apprehensions occurred in California’s Imperial and San Diego counties with more than 5,000 pounds of fentanyl confiscated from drug traffickers, just in the first nine months of the year.

  In San Diego County, the drug has been declared a public health crisis response with homeless individuals experiencing the greatest increase of deaths from fentanyl over the last three years, according to county officials.

  

  Mock sizing of a potentially lethal dose of fentanyl in a file photo. (John Fredricks/The Epoch Times)

  “From 2020 to 2021, the number of fentanyl overdose deaths increased by 90 percent among the unhoused population versus a 32 percent increase among individuals who were not experiencing homelessness,” County of San Diego spokesperson Fernanda Lopez Halvorson, told The Epoch times.

  According to Lopez Halvorson, the county is now saturated with naloxone, known best by its brand name Narcan, to reverse and block the effects of opioids, such as fentanyl.

  “The overarching goal is to distribute 33,000 naloxone kits by June 30, 2023,” Lopez Halvorson said.

  “Overdose deaths are preventable using a comprehensive approach that includes widespread public messaging on the risks of fentanyl and offering naloxone, a safe medication that can reverse an opioid overdose, and an effective treatment for opioid use disorder.”

  At 50 to 100 times more potent than heroin, deaths caused by fentanyl are on the rise in Southern California as the powerful opiate continues to be used more as a substitute ingredient for illicit drugs due to its powerful effect at a cheaper cost. Often, officials say, San Diego is a first stop for smugglers.

  

  A firefighter displays Narcan, a lifesaving medicine used to treat drug overdoses, on Feb 26, 2021. (John Fredricks/The Epoch Times)

  Just in north Orange County, fentanyl deaths among the homeless population continue to increase in Santa Ana and Anaheim, both of which topped the lists for homeless deaths involving the drug in 2020, according to the Orange County Sheriff’s Department (pdf).

  In Santa Ana, which recorded the most homeless deaths involving fentanyl, all officers are now equipped with naloxone, according to the Santa Ana Police Department.

  “With fentanyl being such a potent drug, our officers are instructed to take additional precautionary measures when handling this,” Santa Ana Police Department Sgt. Maria Lopez told The Epoch Times.

  “Our officers are trained in the use of Narcan and administer the medication when they suspect opioid overdose.”

  Further north, in Long Beach, medics recently shared having to use Narcan multiple times in one week on the same person.

  “Usually when it’s a fentanyl [overdose], most of these people have what we call the ‘agonal breathing.’ They look like they’re dead and they might be close to death, but they’re breathing maybe once every minute or so with unbelievably small pupils,” one Long Beach firefighter told The Epoch Times.

  

  A fast driving ambulance navigates the Los Angeles streets on April 4, 2012. (John Fredricks/The Epoch Times)

  As a first responder, the firefighter said he has become all too familiar with two usual responses of recovering someone who has overdosed on fentanyl.

  “More times than not, they are kind of mad at you for ruining the drug high that nearly killed them,” he said.

  The other response, he said, is projectile vomiting.

  The Los Angeles County Department of Medical Examiner-Coroner’s office, which oversees Long Beach, told The Epoch Times that the total number of homeless deaths involving fentanyl as a contributing factor was 310 cases, with cases still pending to the yearly total.

  Sign of the Times

  Along 1st Street in Santa Ana, on a recent day, a man began stripping off his clothing and started clawing at the sky. Working up a sweat as the veins in his arms and head began to protrude, he suddenly bent forward with convulsions in what is known as “nodding out”—body language for an individual working off a fentanyl high.

  Just blocks away a group of about 10 who appeared homeless gathered under shelter at Birch Park as rain began to fall.

  “I’ve got a prize for you!” one man said, between toppling two metallic poles together, pointing his chin toward four homeless individuals to his right.

  

  A homeless encampment in Santa Ana, Calif., on Oct. 5, 2021. (John Fredricks/The Epoch Times)

  There, two men and two women in their mid-to-late 20s passed around a zip-locked bag of an off-white, powder-like substance. They were surrounded by others passed out on benches next to trash bags filled with dirty blankets and comforters.

  A clean-shaven Hispanic man, who appeared to be in his late 50s walked toward the group asking if they wanted money.

  “Nah, we’re alright,” one of the women said. “We’ll take some cigarettes, though.”

  The man then approached them, placing both knees on the ground before exchanging his cash for a smaller cut of the group’s product.

  Then the man with the metal poles began to tap them together at an even faster pace, showing the whites of his eyes as they locked on the man who then retreated.

  During 2022, fentanyl seizures increased 594 percent throughout the State of California, according to the office of Gov. Gavin Newsom.

  Tyler Durden
  Tue, 01/10/2023 – 22:45

• China's Credit Flood Is Coming, But December Was A Disappointment
  China’s Credit Flood Is Coming, But December Was A Disappointment

  Last week, when discussing the end of China’s “three red lines” policy to coincide with the premature end of China’s zero-covid policies, a policy U-turn which will have staggering consequences on the world’s biggest asset bubble and China’s economy, we said that “what China’s reversal means for the rest of the world is that a tidal wave of new credit is about to be unleashed, and as a recent report in Economic Information Daily said, the amount of new credit China issues is likely to reach another record high this year, while interest rates for longer-term loans could decline further. In other words, prepare for a surge in Chinese Total Social Financing as Beijing finally ends its latest experiment with austerity and is finally set to unleash the biggest credit expansion in history.”

  And it will… but not just yet because while we expect a deluge of new Chinese credit (forced or otherwise) to flood the country – and then the world – in 2023, the last month of 2022 was a damp squab, with the PBOC reporting December credit data that was mixed at best.

  On one hand, total RMB loans surprised the market to the upside and showed broad-based improvement – both mortgages and corporate medium to long term loan growth increased in December. According to Goldman, Beijing’s property policy easing after the “16 measures to support the property sector” and the accommodative monetary policy stance (the PBOC delivered the 25bp RRR cut in early December) likely both contributed to the acceleration in RMB loan growth.

  

  On the other hand, total social financing and M2 growth missed expectations and decelerated materially from November. Very weak corporate bond net issuance due to the bond market repricing around wealth management product redemption and liquidity concerns dragged down overall total social financing growth. The deceleration in M2 growth was likely due to the dissipation of one-off factors (PBOC stated that commercial banks converted some FX to RMB – and maybe gold – in November) and smaller balances of PSL. In addition, PBOC and CBIRC jointly held a meeting with major policy and commercial banks today (January 10th), urging banks to strengthen financial support to the real economy, and in particular to the property sector.

  Here are the details:

  • New CNY loans: RMB 1400Bn in December vs. Bloomberg consensus: RMB 1200bn, and up from 1213.59bn in Nov.
    • Outstanding CNY loan growth: 11.1% yoy in December; November: 11.0% yoy (+8.0% mom sa ann).
  • Total social financing: RMB 1310 billion in December, vs. consensus: RMB 1850 bn, and down sharply from 1.987.4 billion in November.
    • TSF stock growth: 9.6% yoy in December, vs. 10.0% in November. The implied month-on-month growth of TSF stock: 4.8% SAAR in December vs. 5.5% in November.
  • M2: 11.8% yoy in December vs. Bloomberg consensus: 12.3% yoy, and down from 12.4% yoy in November.

  And the main points, courtesy of Goldman:

  • 1. December total social financing (TSF) came in below market expectations. The sequential growth of TSF stock decelerated further to 4.8% mom sa annualized in December from 5.5% in November, and in year-on-year terms, TSF stock growth decelerated to 9.6% from 10.0% in November. Among major TSF components, new CNY loans rose after seasonal adjustment, while corporate and government bond net issuance, shadow banking credit slowed. Trust loans, entrusted loans and discounted bankers’ acceptance bills combined contracted by RMB 452bn in December, vs a contraction of RMB 116bn in November. Corporate bond showed net redemption of RMB 288bn, vs net issuance of RMB 15bn in November. Expect most of these categories to accelerate notably in 2023.

  

  • 2. Overall CNY loans came in above market expectations, and the sequential growth of RMB loans accelerated to 12.1% mom sa annualized from 8.0% in November. Year-on-year growth of RMB loans was 11.1% in December, edging up from 11.0% in November. The acceleration of loan growth is relatively broad based. Policymakers urged commercial banks to step up support to property developers after announcing “16 measures” to support the property sector, which likely contributed to the acceleration in corporate loans. Policy banks’ credit support to infrastructure projects likely also added to corporate loan growth. Corporate medium to long term loan growth increased to 24.4% mom sa annualized, vs 14.0% mom sa annualized in November. By comparison, household medium to long term loans, which are mostly mortgages, grew 5.3% mom sa annualized in December, vs. 4.8% in November. Household short-term loan (mostly consumer loans) extension also accelerated to 8.0% on a month-over-month basis, vs 2.8% mom sa annualized expansion in November.
  • 3. M2 growth decelerated to 11.8% yoy in December from 12.4% in November, below market expectations. Fiscal deposits declined by RMB 1086bn in December this year, similar to the RMB 1030bn decline in December 2021. The one-off FX conversion to RMB by commercial banks contributed to the acceleration in M2 growth in November. Moreover, in December, PSL balance shrank by RMB 17bn, in contrast to the expansion of RMB 368bn in November. The dissipation of one-off factors due to FX conversion and the net reduction in PSL balance might have both contributed to the slowdown of M2 growth in December vs November.

  

  Bottom line, the December loan and credit data was at best mixed. The acceleration in bank loans reflected policy support – commercial banks extended more loans to property developers after the “property 16 measures”, and policy banks’ credit facility targeting at infrastructure investment in recent months likely also added to overall RMB loan growth. On the other hand, TSF growth was weak and decelerated in December. Bond market volatility due to liquidity concerns and wealth management product redemption – which was catalyzed by the fears over Zero-Covid transition – reduced bond net issuance and potentially also dragged down shadow banking credit. The decline in corporate bond net issuance and the contraction in shadow banking credit more than offset the increase in RMB loans.

  That said, in today’s (January 10th) meeting with major policy and commercial banks, PBOC and CBIRC reiterated their accommodative stance and pledged to strengthen financial support to the real economy and in particular to the property sector. As such, the broad credit growth will almost certainly accelerate in early 2023 from the very low sequential growth in December 2022. High frequency activity indicators showed signs of stabilization, and nationwide Covid infections peaked in late December last year to early January this year. The recovery of broad activity growth could also add to credit demand and help with a rebound in overall credit growth in early 2023.

  Tyler Durden
  Tue, 01/10/2023 – 22:25

• War In Ukraine: Hunting For The Mega Trade
  War In Ukraine: Hunting For The Mega Trade

  By Russell Clark of The Capital Flows and Asset Markets Substack

  

  I get asked a lot about whether I am going to go back to the asset management industry. The temptation is strong. Lets say I find a great trade, then perhaps I can increase my net worth 3 or 4 times over a 10 year run. But if its a trade that can also raise capital, and become a cornerstone of a fund management business, then you are a looking at something that increase your wealth exponentially. The best trades are always contrarian in some way, and so you really need to be convinced to make them work.

  I have had two mega trades that really moved the needle for me. The first was China. In 1998, I was living in Hong Kong, and one job I had was to take Japanese executives up to visit factories in China. I learnt two things from this – first China had amazing infrastructure. I still remember arriving at a huge airport in Guilin and only seeing two flights scheduled to land that day. I asked my brother why build such a big airport, and he said the CCP plans for the future. From 1998 to 2008, I made it a priority to try and latch my career to that of China as close as possible. This was more difficult than you could imagine. In 2002, after two years working in Australia, I tried to get a transfer to Hong Kong. There were no jobs. The closest jobs to “China” I could come up with was an auto analyst in Japan, or an emerging market analyst in London. I went with the latter, but the pay was so low, the custom official asked me how I was going to survive in London. He only let me in when I assured him my company was paying for accommodation. And from 2002, I ran the bull market first as an analyst, and then from 2006 as fund manager all the way up.

  

  I managed to get short emerging markets and China in 2008, but was still short in 2009, when China launched its huge stimulus program. I was certain that a economic growth programme centred on not only building more housing, but getting house prices to rise was doomed to failure. At the time, Chinese induced stimulus and inflation, as well as the ongoing Eurocrisis had led people to be very bearish on bonds. But I was pretty certain that a country like Ireland would never be allowed to default, and that inflation was going to be much weaker than expected. In 2011, buying bonds was a 10 year mega trade.

  

  When Russia invaded Ukraine, this has made me think that the new mega trade, was short bonds long gold. This was part of a longer term idea that we are moving from pro-capital policies to pro-labor policies. This has led me to keep thinking that we might see a repeat of the 1970s in terms of gold versus bonds.

  

  However, as I have been reading about the war, a new thought, and potential variant mega trade has started to form in my mind.

  If you had previously asked me about Elon Musk’s SpaceX programme, Jeff Bezos’ Blue Origin, or Branson’s Virgin Galactic, I would have assured you it was a good sign of the top of the tech market, just as Japanese plans to grow mushrooms on the moon was a top in 1980s. Space and the satellite business have tended to be blackholes (pun intended) for both private and public sector. Elon Musk with his development of reusable rockets, and has greatly reduced the cost of launching satellites. On the back of this he launched his Starlink business. The transformation of satellite business have been stunning.

  

  As the Economist article this week makes clear, Ukrainian access to Starlink has probably been one of the key factors in Ukrainian success in turning the tide of the war. Even more important, is that Starlink has continued to work despite Russian best efforts to disrupt it. This is the most important feature of the war. Musk is now in control a telecommunication network that cannot be disrupted by governments, and a telecommunication network that is better than the current satellite based networks that every other country uses. As far as I can tell, the satellites and the software used with Starlink can be easily copied. The real key is the ability to launch many satellites quickly and cheaply. That is SpaceX is really the valuable asset, not Starlink. The military implication is that every country that wishes to have an independent military, needs to develop its own SpaceX program. China and India definitely, Russia probably, Europe and Japan maybe. I think it will be reasonable to expect in 10 years time, that there will 3 or 4 SpaceXs operating, and that global launches to space could be almost a daily event. I am pretty sure, this will not be a profitable venture, but as it is necessary for military advantage, it will happen anyway. One area that should see surging demand is rocket fuel – and particularly liquid oxygen. Space travel is a new area of research for me, but the internet suggest Air Liquide and Air Products (the clue is in the name) are key supplies of liquid oxygen, and both stocks have been reassuringly good performers.

  

  Thinking more long term, the emergence of competitive satellite business with limited latency and/or ability to be disrupted will have significance consequences for land based telecommunication businesses. The current mobile phone base tower businesses have been built around monopolising the best area for base towers, and the getting mobile phone companies to agree CPI + price agreements over many years. And like any good short idea, they have been reassuringly weak.

  

  When Russia originally invaded Ukraine, I worried that this would lead China to either join Russia, or catalyse a Chinese invasion of Taiwan. The military success of Starlink, makes this seem less likely to me. So this is bullish in some respects. But Starlink is going to cause a new arms/space race, and within that I can see a good trade in long space fuel, and short tower companies. Space fuel is commodity linked, and tower companies were seen as bond proxies for years, so after all that, I end up back with a surrogate long GLD/short TLT trade. That’s still fine by me – hopefully for you too. Space is a mega trade, that seems to fit into the political environment of a shift to pro-labour. Maybe I should set up a fund – but in the mean time, I will keep publishing my ideas here.

  Tyler Durden
  Tue, 01/10/2023 – 22:05

• Fragile Global Democracy
  Fragile Global Democracy

  With comparisons to January 6 immediately being drawn, thousands of supporters of Brazil’s far-right former president Jair Bolsonaro forced their way into the country’s congress, presidential palace and supreme court on Sunday. It took roughly three hours for security forces to regain control of the situation, with at least 300 arrests being made. The main motivation behind the riot has been linked to Bolsonaro’s followers’ refusal to accept the results of October’s election, which led to the return to power of leftist Luiz Inácio Lula da Silva.

  While democracy has held out in the United States after the Capitol riot and so far in Brazil now too, an analysis collated by Our World in Data highlights how fragile it can be.

  The share of the world living in either an electoral or liberal democracy was at its highest in the year 2000 when the figure was at 54 percent.

  As Statista’s Martin Armstrong shows in the infographic below, ‘global democracy’ took a steep dive in 2019, dropping from 50 percent down to just 32. While the fragility of democracy is also plain to see elsewhere in the chart, this is the most dramatic example over the assessed period.

  

  You will find more infographics at Statista

  The main cause of this decrease was India and its downgrade by Freedom House to a ‘partially free democracy’ and to an ‘electoral autocracy’ by the V-Dem Institute at the University of Gothenburg since Modi‘s win in the country’s 2019 election. The latter downgrade was justified by the alleged “increased pressure on human rights organizations, rising intimidation of academics and journalists, and a spate of bigoted attacks, including lynchings, aimed at Muslims” leading to a “deterioration of political rights and civil liberties”.

  The rise of democracy has been one of the greatest collective human achievements of the last century, allowing large shares of the world’s population to live in relative freedom and have the ability to alter the politics and society of their country. Has this expansion already peaked though?

  Tyler Durden
  Tue, 01/10/2023 – 21:45

• Hundreds Of Illegal Aliens Intercepted Off Florida Coast Repatriated To Cuba, Haiti
  Hundreds Of Illegal Aliens Intercepted Off Florida Coast Repatriated To Cuba, Haiti

  Authored by Caden Pearson via The Epoch Times,

  The U.S. Coast Guard repatriated 83 illegal aliens to Haiti on Monday and 273 to Cuba on Sunday after they were intercepted in the Florida Keys over the New Year period.

  

  (L) An illegal alien vessel about seven miles south of Big Pine Key, Florida, on Jan. 1, 2023; (R) A vessel carrying Haitians on Jan. 3, 2023, who were repatriated to Haiti on Jan. 9, 2023. (Courtesy of U.S. Coast Guard)

  The Coast Guard said it continues to intercept and rescue illegal aliens from overloaded and unseaworthy vessels and warned that those interdicted at sea would be repatriated.

  In a statement about the 83 Haitians repatriated on Monday, Lt. Travis Poulos said Coast Guard District Seven and partner agencies continue to patrol the Florida Straits, Windward, and Mona passages.

  “These ventures are extremely dangerous and could cost you your life,” Poulos said.

  

  The Coast Guard Cutter Mohawk’s crew departs Matanzas, Cuba, following a repatriation of Cuban illegal aliens to Cuba on Jan. 8, 2023. (Lt. Cmdr. Ryan Newmeyer/U.S. Coast Guard)

  The 83 Haitians were first spotted in a sailing vessel by a West Palm Beach Coast Guard crew near Hobe Sound on Jan. 2, then again by a good Samaritan on Jan. 4 about five miles east of Key Lago—around 156 miles apart. There were men, women, and children aboard, according to the Coast Guard.

  Lt. Cmdr. John Beal said Coast Guard District Seven crew continue to intercept and rescue Cubans “from grossly overloaded, unseaworthy vessels.”

  “These illegal voyages are always dangerous and often deadly,” Beal said in a statement on Sunday.

  “We are working closely with partner agencies to save lives and prevent illegal entry to the United States via our southeast maritime border. Those interdicted at sea will be repatriated.”

  Florida’s state government will also deploy aircraft from the Florida National Guard to back up marine patrols to “support water interdictions and ensure the safety of migrants attempting to reach Florida through the Florida Straits.”

  

  A vessel carrying illegal aliens who were repatriated to Cuba on Jan. 8, 2023; reported to U.S. Coast Guard Sector Key West watchstanders by a good Samaritan about four miles south of Duck Key, Florida, Jan. 1, 2023. (Courtesy of U.S. Coast Guard Station Marathon’s crew)

  DeSantis Activates National Guard

  Over 300 illegal aliens unlawfully arrived in the Florida Keys over the New Year period, prompting Gov. Ron DeSantis to sign an executive order on Jan. 6 to activate the National Guard.

  State officials were forced to shut the Dry Tortugas National Park, about 70 miles west of Key West, after 300 aliens landed there, while a further 45 arrived in Key West. The Coast Guard said around 10 vessels were reported and intercepted throughout the Florida Keys between Dec. 31 and Jan. 1.

  “As the negative impacts of [President Joe] Biden’s lawless immigration policies continue unabated, the burden of the Biden administration’s failure falls on local law enforcement who lack the resources to deal with the crisis,” the Republican governor said in a statement.

  “That is why I am activating the National Guard and directing state resources to help alleviate the strain on local resources. When Biden continues to ignore his legal responsibilities, we will step in to support our communities.”

  

  A boat that was left along the shoreline after it was used recently to transport Cuban illegal aliens from the island nation to America in Key West, Florida, on Jan. 6, 2023. (Joe Raedle/Getty Images)

  In addition, DeSantis’s executive order (pdf) directs state law enforcement and other state agencies to “provide resources in support of local governments” responding to the influx of illegal aliens in the Florida Keys, as well as “additional support toward efforts to prevent further migrant landings on Florida’s shores.”

  The 194 deputies of the Monroe County Sheriff’s Department struggled to manage the influx of hundreds of illegal aliens while also trying to ensure public safety, according to DeSantis’s office.

  Biden Parole Program

  On Jan. 5, Biden announced a new policy to turn back Cubans, Haitians, Nicaraguans, and Venezuelans who arrive illegally in the United States. People from these four countries make up the majority of illegal aliens crossing the southwest border, Biden said.

  The “parole program” will allow up to 30,000 people a month from those four countries to seek asylum in the United States, provided they apply online while in a non-U.S. country, pay their airfare, and find a U.S. sponsor. They then need to make an appointment via the CBP One app to meet with a border agent.

  “But if their application is denied or if they attempt to cross into the United States unlawfully, they will be returned back to Mexico and will not be eligible for this program after that,” Biden said.

  The president said his administration expects this will “substantially reduce” the number of people attempting to cross the southwest border “without going through a legal process.”

  “We can’t stop people from making the journey, but we can require … that they come here in an orderly way under U.S. law,” he added.

  “And let me say it again: The actions we’re announcing today will make things better … but will not fix the border problem completely.”

  The Coast Guard said it’s intercepted and blocked 4,795 Cubans trying to enter the United States illegally since October, while the governor’s office said over 8,000 illegal aliens have been encountered in the waters off Florida since August.

  Tyler Durden
  Tue, 01/10/2023 – 21:25

• Cannabis Grower Tilray Mulls Expansion Into Fruit And Vegetable Growing, Alcohol, While Awaiting U.S. Legalization
  Cannabis Grower Tilray Mulls Expansion Into Fruit And Vegetable Growing, Alcohol, While Awaiting U.S. Legalization

  We once thought the obvious pivot would be traditional food and beverage manufacturers looking to eventually incorporate marijuana based products into their portfolios of products. Now, it looks like the opposite could be happening. 

  As marijuana legalization at the federal level in the U.S. has not proceeded as expediently as once predicted, grower Tilray Brands is now considering acquisitions that could move it into the alcohol – or even the produce – space. 

  Chief Executive Officer Irwin Simon said this week that, while it has set up infrastructure for the eventual distribution of its products in the U.S., a “lack of political action” has caused it to shift its vision, Yahoo reported. 

  Now the company is considering using some of its growing capacity for fruits and vegetables as a short term measure. It is also considering acquisitions that would move it further into setting up a U.S. distribution network, for when marijuana is eventually legalized. 

  

  Simon asked rhetorically on a company conference call this week: “There’s food shortages in the world of lettuce, tomatoes, strawberries. If we have overcapacity, how do we start growing fruits and vegetables at some of these facilities and supply food to the world?”

  Analysts were hesitant at the idea, instead asking if the company should simply be focused on reducing its growing capacity. In response, Simon reminded them that the company’s top priority remains cannabis and that the idea of growing fruits and vegetables would only be a “temporary bridge”. Later in the day, on a different call, Simon reassured analysts that facilities would be easily converted for legalized cannabis in the U.S. or Europe when the time was right. 

  Tilray already owns SweetWater Brewing Co and Montauk Brewing Co, as well as a bourbon maker, Breckenridge Distillery, Yahoo reported. While those names are small in size, the company isn’t against taking on a larger potential brand name. “If there was a national brand, we would look at that too,” Simon concluded. 

  Tyler Durden
  Tue, 01/10/2023 – 21:05

• Privacy Watchdog: ATF Uses Stingrays To Track Americans
  Privacy Watchdog: ATF Uses Stingrays To Track Americans

  Authored by Ken Silva via Headline USA (emphasis ours),

  The Project for Privacy & Surveillance Accountability announced this week that it has obtained records about the Bureau of Alcohol, Tobacco, Firearms and Explosives’ use of stingrays to track Americans.

  

  Stingrays are a relatively new technology that simulate cell towers and collect signals from devices nearby.

  PPSA filed a Freedom of Information Act request with the ATF in February 2021, and announced on Wednesday that it had received a batch of documents. According to PPSA, those documents show that the agency uses stingrays.

  “The information released by the ATF confirms the agency is indeed utilizing stingray technology,” PPSA said. “Although the agency attempted to minimize the usage of stingrays, it is clear they are being widely used against Americans.”

  PPSA has not published the documents it received, but described some of their contents.

  “The ATF stressed that stingrays are not precise location trackers like GPS, despite the plethora of information stingrays can still provide,” the organization said. “Answers to questions from the Senate Appropriations Committee about the ATF’s usage of stingrays and license plate reader technology are entirely blacked out in the ATF documents we received.”

  PPSA added that ATF policy conceals the use of these devices from their targets, even when relevant to their legal defense.

  PPSA said there’s an example of this in the documents it received.

  “When an ATF agent interviewed by a defense attorney revealed the use of the equipment, a large group email was sent out saying: ‘This was obviously a mistake and is being handled,’” the privacy watchdog said.

  PPSA said it will continue to track stingray usage and report the responses it receives to its FOIA requests with various federal agencies.

  Civil liberties activists have noted that the use of stingrays by law enforcement dramatically increased after the U.S. Supreme Court’s ruling in Carpenter v. U.S., which found that law enforcement’s warrantless collection of cell phone geolocation data violated the Fourth Amendment. Instead of obtaining warrants, police agencies have used stingrays as a workaround.

  Ken Silva is a staff writer at Headline USA. Follow him at twitter.com/jd_cashless.

  Tyler Durden
  Tue, 01/10/2023 – 20:45

• When Will The Fallen Generals Rise
  When Will The Fallen Generals Rise

  The S&P 500, the world’s biggest and most liquid equity index influences the sentiment or price of most global assets. However, as discussed here repeatedly over the past few years, its performance has been skewed by mega-cap growth stocks, i.e., the Generals. Of course, in 2022, they had a very tough time. Tesla (-65.0%), Meta (-64.2%), Amazon (-49.6%), Alphabet (-39.1%), Microsoft (-28.0%), and Apple (-26.4%) all underperformed to sometimes dramatic effect. And given these 6 names alone still comprise around 19% (down from 26% this time last year) of the world’s most important stock index, DB’s Jim Reid notes that even macro-only investors need to pay attention.

  Of this list, Tesla has been the most volatile this year falling 12.2% on the first day but having two +5% plus days, including yesterday. It’s -2.8% so far in 2023.

  Which brings us to today’s Chart of the Day from Jim Reid, which updates a graph from his “bubble chart book” in January 2021. Back then, he showed that Tesla’s market cap was around as big as the next largest 8 global auto companies. That was obviously a premature concern as at the peak in November 2021 (market cap $1.24tn), it was then worth around the same amount as the next 13 largest – an incredible stat.

  Fast forward to today and it’s now back down to being worth a bit more than just the next two largest ($378bn market cap).

  

  While Reid admits that he not is a single-name stock analyst, he says it’s interesting to debate what valuation such a disruptor should have relative to the competition: “After all, non-fossil fuel cars will continue to dominate the roads for some years, but most car companies will also compete for the spoils in the electric market. It is true that Tesla bulls have pointed out for some years that disruptors such as Apple and Amazon have maintained a dominant position in their respective sectors. But it’s not clear if the sectors/products are comparable. The bulls might also point to Tesla still having increased by 5 times since the March 2020 Covid lows. So, the starting point is important.”

  In any event, at the peak, we were still in a world of zero yields and expected to stay there in perpetuity by many. As such, companies with an expected high earnings stream in the future were given very high multiples. This wasn’t the fault of those companies impacted.

  So for macro, Reid says that “it is interesting to debate how much of the recent fall in such stocks is down to the interest rate environment changing, and how much was a fundamental overvaluation story.” That matters if the interest rate environment changes again (not if but when) and as such is important for macro.

  Tyler Durden
  Tue, 01/10/2023 – 20:25

• US Should Remain In Ukraine Until "Putin Is Out": Senator
  US Should Remain In Ukraine Until “Putin Is Out”: Senator

  Authored by Kyle Anzalone & Connor Freeman via The Libertarian Institute,

  Senator Angus King said the US should not put a timetable on support for Ukraine and remain involved in the war until “Putin is out.” Comparing the current situation with Russia to the Allies’ failure to stop Nazi Germany before World War II, the Maine senator insisted on more Western aid for Kiev.

  During a virtual press conference following his recent visit to the Ukrainian capital, King was asked how long the United States should continue its role in the conflict, replying that support for Kiev should be indefinite. “I believe we should remain there until Putin is out,” he said. 

  

  It is unclear if King was calling for Putin’s removal from power in a coup d’etat, or merely for Russian troops to vacate all Ukrainian-claimed territory. The two warring parties maintain conflicting territorial claims and King acknowledged the war is now in a stalemate, but he nonetheless claimed the conflict would not be a “20-year struggle” like America’s experience in Afghanistan.

  Throughout the virtual presser, King referenced a historical need to prevail over Russia, saying nothing of the potential for escalation to nuclear war between the world’s largest atomic arsenals. 

  The senator noted that he often receives questions from constituents about the wisdom of US involvement in the war, but went on to cite his own version of a Bush-era epithet: ‘We fight them over there so we don’t have to fight them over here.’

  “I get letters every now and then, people saying, ‘Why are we doing this? Ukraine’s far away. It’s not our fight.’ Well, it is our fight, because if we don’t fight it now, it will spread,” King said. “And it will become something that we can’t avoid being involved in, just as occurred in the late 1930s at the beginning of World War II.”

  He went on to claim that if Putin was not stopped in Ukraine, he would go on to conquer more of Europe, comparing the Russian leader to Adolf Hitler several times. 

  King also suggested the US could give additional aid to Ukraine, pointing to allies who are giving more when compared to their overall gross domestic product. “If you measure it in terms of GDP, we’re between fifth and tenth in the world, and other countries are contributing actually larger shares of their GDP to the defense of Ukraine,” he continued, “Why? Because they recognized, as hopefully we will continue to recognize, that this is really a fight for Western values.”

  Since Russia’s invasion kicked off last February, Congress has authorized nearly $120 billion in aid for Kiev, including more than $21 billion in direct military assistance and a series of other financial and humanitarian aid packages. King claimed the American tax dollars are being well spent and accounted for, arguing “The software that they’re using, working with Deloitte and SAP, to track everything coming in – every spare part, every dollar.”

  Amazing candor from Iran-Contra felon Ollie North:

  Ukraine is just like Reagan’s dirty wars in Central America, Africa and Afghanistan

  Most of the aid is a kickback to US weapons makers and Beltway contractors

  The proxy war is preparation for a larger war w/ China over Taiwan pic.twitter.com/kmKW2JZCH4

  — Max Blumenthal (@MaxBlumenthal) December 29, 2022

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  However, CNN has reported that US arms sent to Ukraine quickly fall into a “black hole” and are nearly impossible to track. In October, Finland’s national law enforcement agency warned that weapons being shipped to Ukraine are ending up in the hands of criminal gangs, while Nigerian President Muhammadu Buhari warned weeks later that “the situation in the Sahel and the raging war in Ukraine serve as major sources of weapons and fighters that bolster the ranks of the terrorists in the Lake Chad Region.”

  King’s latest presser followed a trip to Ukraine last week, where he said he held a “thrilling” meeting with President Volodymyr Zelensky and described him as among “the great leaders of the century.”

  While the senator claimed Zelensky and Ukraine are champions of democracy, some analysts have argued that Kiev has only continued its transformation into an authoritarian state under his rule. As commentator Ted Galen Carpenter wrote in The American Conservative, “genuine democracies do not ban multiple opposition parties or close opposition media outlets. Nor do they rigorously censor (and put under strict government control) media outlets that they allow to remain open. Genuine democracies do not outlaw churches that advocate policies the government dislikes.” He added, “yet the Ukrainian government has committed not just one or two, but all of those abuses.”

  Tyler Durden
  Tue, 01/10/2023 – 20:05

• Shortage Fears Spike As Some Costco And Walmart Stores Run Out Of Eggs
  Shortage Fears Spike As Some Costco And Walmart Stores Run Out Of Eggs

  Most Americans have watched their food expenses at grocery stores ballon in recent years. The one item that likely shocked consumers the most is the skyrocketing price of a dozen eggs.

  Avian flu has decimated the US egg-laying hen population at commercial farms. Tens of millions of hens have been culled to prevent one of the worst bird flu outbreaks on record from spreading, though efforts have failed as the virus continues to decimate US egg production, sending retail prices sky-high. 

  

  Readers have known about the dire egg situation for many quarters, but the evolving story is that people are now posting images of supermarkets across the country running out of eggs.

  Never in our life’s has this country run out of #Egg #eggflation thanks to the irresponsible money printing of @TheDemocrats @POTUS and #FederalReserve pic.twitter.com/0A2I9YWM5Y

  — Golden Coast (Cassandra) (@GregCrennan) January 10, 2023

  Costco customers are stunned by the egg shortage.  

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  This Costco is now completely sold out of eggs.🚨

  2020 was toilet paper.
  2023 is going to be a run on eggs. Get yours now.

  Part of this is avian flu and reduced numbers production.

  🔊sound …🔥🔥🔥 pic.twitter.com/GfyyEu2dpz

  — Wall Street Silver (@WallStreetSilv) January 10, 2023

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  2 weeks still no eggs at Costco in So cal!#thanksbiden pic.twitter.com/0iZeIbrP4o

  — Wakethruster (@wakethruster) January 10, 2023

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  Wow even Costco is out of eggs. pic.twitter.com/9V4PkR57wz

  — Joshua T. Hosler (@JoshuaHosler) December 31, 2022

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  Not only is an 18 pack of eggs $8, there’s now these signs all over the place. Costco can’t even keep their eggs in stock past 830am.

  We need to be talking about this more. I don’t care what the President and his people say, it’s getting worse, not better. pic.twitter.com/e0d0Uf0gNI

  — Tuggs🍷🥩✝️ (@thattugglife) January 4, 2023

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  I don’t really want to panic….but Costco is out of eggs and egg whites now too pic.twitter.com/ZVdkpZODda

  — DJ Romeo (@ROMEOREYES) January 10, 2023

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  @costco no eggs… pic.twitter.com/rroR03acHn

  — Tom Young (@TomYoungSoup) January 8, 2023

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  Costco and Walmart were both out yesterday…and when they have them there’s a limit now. #EggShortage https://t.co/A35CPUQnjB

  — Matt McAllister (@MorningWolfMatt) January 10, 2023

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  My #Costco in Tumwater WA was completely out of eggs on Saturday. We have #WilcoxFarms here in Washington. I was told by the store the egg shortage is due to the #birdflu.

  — Kimberly Barr (@Kimberl74195353) January 10, 2023

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  Hmmm.. that’s the issue with information. What do we even believe anymore.. all I DO know is I eat eggs daily and the shelves are empty… something is causing this shortage.

  I can understand Gas or Toilet Paper.. but, come on.. EGGS?! … before Easter too? pic.twitter.com/9D7qjsHJ8C

  — 49er Luke 💪🏼🏋🏻‍♂️🥇 (@Luke_AZ) January 9, 2023

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  #Goteggs #eggshortage @Safeway #costco pic.twitter.com/UgXV7VZrwP

  — Stanley Roberts (@StanleyRoberts) January 4, 2023

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  The search trend “egg shortage” has hit a new high. 

  

  News stories across the web featuring “egg shortage” have also surged, the highest since the last avian flu outbreak in 2015. 

  

  In 2020, toilet paper was in short supply. Now it’s 2023, and it appears nationwide egg supplies are dwindling. 

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  Looks like eggs are the new toilet paper 👀😳 pic.twitter.com/cnpgEEC43y

  — Emily Hoeven (@emily_hoeven) January 10, 2023

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  How long until people figure out that becoming your supplier of food (i.e., farmer) and living as much as you can off the grid can save you from the pain of shortages and inflation? Perhaps, people will panic search for where to buy egg-laying hens and start their own farm — clearly, America’s food supply chain continues to fracture. 

  Tyler Durden
  Tue, 01/10/2023 – 19:45

• Can 'The Magnificent 20' Remake The Republican Party For The Better?
  Can ‘The Magnificent 20’ Remake The Republican Party For The Better?

  Authored by Roger L. Simon via The Epoch Times (emphasis ours),

  The success of what we might call “The Magnificent 20”—after the film “The Magnificent Seven,” itself a remake of Akira Kurosawa’s classic “Seven Samurai”—who were able to win many concessions in return for allowing Rep. Kevin McCarthy (R-Calif.) to become speaker of the House, has implications far beyond Congress.

  

  It could and should be a harbinger of a new Republican Party, a party that’s actually responsive to the people, to the will of its voters.

  This would be something unique in recent American politics, right or left.

  For this to happen, two important things must happen.

  One, those voters must keep their politicians’ feet to the proverbial fire; in fact, they must redouble or more their vigilance.

  Two, Republican establishment politicians must themselves do either of two things: get off the playing field or show some real courage by demonstrably, and not just verbally, reforming.

  We’ll have a rapid measure of the latter with the behavior of McCarthy.

  But it’s a far greater problem than that. The Republican Party, high and low—including all its institutions from the Republican National Committee down to the county level—are shot through with “Six Degrees of RINOism”—those who occasionally say the right things for the public, but rarely follow through in private.

  Often, they deliberately obstruct real constitutional progress and the very things the 20 were fighting for. The primary interest of these people isn’t the wishes of the people but their own self-interest, preservation of power, and, most of all, financial gain.

  Even at those lower levels—down to the selection of textbooks, local candidates for seemingly minor positions, and, it should go without saying, voting methods themselves—political power has become a royal road to riches. At the higher level, it has become a royal road to spectacular riches with Big Tech and Big Pharma, not to mention China, providing virtually limitless wherewithal.

  To put an end to this and to honor the courage of “The Magnificent 20,” the Republican Party needs what communists used to call a rectification program. That’s becoming evident from those Republicans who are suddenly rising in resistance to the House Rules package with the bogus excuse that it was negotiated behind closed doors, as if it could have been done otherwise, given the current state of our country.

  But there’s good news, optimistic news, with excellent ramifications for the future, including and especially the announcement that Rep. Jim Jordan (R-Ohio) will chair the select committee on the “Weaponization of Government.” Nothing could possibly be more urgent for the survival of our republic.

  So let’s cheer on the work of “The Magnificent 20” and their comrades-in-arms, such as Jordan and the others who supported them in their quiet, let’s hope now-public, ways.

  And if you’ll excuse this onetime Hollywood screenwriter (special advice: avoid the acclaimed but über-pretentious and boring “Tár” at all costs), I would like to explain my reference to “Seven Samurai,” which was directed by Kurosawa, possibly the greatest filmmaker of all time.

  Read the rest here…

  Tyler Durden
  Tue, 01/10/2023 – 19:25

• Pentagon Drops COVID-19 Vaccine Mandate For Troops
  Pentagon Drops COVID-19 Vaccine Mandate For Troops

  The Pentagon announced on Tuesday that the Covid-19 vaccine will no longer be required for troops, according to a new memo signed by Defense Secretary Lloyd “Raytheon” Austin.

  

  The memo – widely anticipated wince new legislation signed into law on Dec. 23 required him to rescind the mandate within 30 days – does give commanders discretion over how unvaccinated troops are deployed, whatever that means.

  Leading up to the decision, the Defense Department had already ceased all punitive actions against personnel who refused the shot.

  “The Department will continue to promote and encourage COVID-19 vaccination for all service members,” reads Austin’s memo. “Vaccination enhances operational readiness and protects the force.”

  

  The 30-day requirement to rescind the mandate was instituted under an $858 billion defense spending bill signed into law in December by President Joe Biden, who had opposed the GOP-backed provision, and agreed with Austin who at the time said that lifting the mandate wasn’t in the best interests of the military.

  Ultimately, Biden caved in order to win passage of the legislation.

  More than 8,400 troops were forced out of the military for refusing the jab.

  Tyler Durden
  Tue, 01/10/2023 – 19:05

• The Present Fiat Monetary System Is Breaking Down
  The Present Fiat Monetary System Is Breaking Down

  Authored by Frank Shostak via The Mises Institute,

  The heart of economic growth is an expanding subsistence fund, or the pool of real savings. This pool, which is composed of final consumer goods, sustains individuals in the various stages of the production process. The increase in the pool of real savings permits the expansion and the enhancement of the infrastructure, and this strengthens economic growth. An increase in economic growth for a given stock of money implies more goods per unit of money. This means that economic growth, all other things being equal increases the purchasing power of money.

  

  Note that most individuals are likely to strive to improve their living standards. This means that individuals are likely to aim at expanding the pool of real savings, which will in turn strengthen economic growth and the purchasing power of money. In the framework of market-selected money such as gold, the purchasing power of money is likely to strengthen over time.

  According to Joseph Salerno,

  Historically, the natural tendency in the industrial market economy under a commodity money such as gold has been for general prices to persistently decline as ongoing capital accumulation and advances in industrial techniques led to a continual expansion in the supplies of goods.

  Hence, in the framework of a gold standard, the purchasing power of financial assets such as stocks and bonds is likely to strengthen alongside economic growth. Note that stronger economic growth, all other things being equal, implies a strengthening in the pool of real savings; i.e., the pool of final consumer goods.

  Under the present monetary standard—i.e., the paper standard—an increase in the quantity of money, because of the loose policy of the central bank, undermines the pool of real savings and in turn undermines economic growth.

  (Observe that loose monetary policy sets in motion an exchange of nothing for something.)

  As long as the pool of real savings is expanding, the increase in the money supply creates the illusion that the central bank can generate real economic growth and strengthen assets’ purchasing power. However, once the pool of real savings comes under pressure because of the monetary pumping, the growth in assets’ purchasing power starts to slow. According to Richard von Strigl,

  Let us assume that in some country production must be completely rebuilt. The only factors of production available to the population besides labourers are those factors of production provided by nature. Now, if production is to be carried out by a roundabout method, let us assume of one year’s duration, then it is self-evident that production can only begin if, in addition to these originary factors of production, a subsistence fund is available to the population which will secure their nourishment and any other needs for a period of one year. . . . The greater this fund, the longer is the roundabout factor of production that can be undertaken, and the greater the output will be.

  The Subsistence Fund and Money

  When producers exchange their produce for money, they can then exchange their money for various consumer goods; i.e., they can access the subsistence fund whenever they deem this necessary. When an individuals exchanges their money for goods, this is an act of exchange and not an act of payment—money is just the medium of exchange. Payment is made by means of various goods.

  For instance, a baker pays for shoes by means of the bread he produced, while the shoemaker pays for the bread by means of the shoes he made. (Both shoes and bread are part of the subsistence fund, as they are final consumer goods.) When the baker exchanges his money for shoes, he has already paid for the shoes with the bread that he produced prior to this exchange.

  Trouble erupts when, on account of loose monetary policies, a structure of production emerges that ties up much more consumer goods than it creates. This excessive consumption relative to the production of consumer goods leads to a decline in the subsistence fund, meaning that there is less economic support for the individuals that are employed in the various stages of the production structure. This results in an economic slump.

  Intermediate Goods

  What about a producer of intermediate goods, like a producer of a special tool—what is his contribution to the subsistence fund?

  An individual who exchanges his money for the tool will employ the tool in the production of final consumer goods or in the production of other tools and machinery that, in turn, will contribute to the production of final consumer goods sometime in the future. The producer of the special tool does not directly supply final consumer goods. However, he does offer means to secure these goods. He also offers time.

  According to Murray Rothbard:

  Crusoe without the axe is two hundred fifty hours away from his desired house; Crusoe with the axe is only two hundred hours away. If the logs of wood had been piled up ready-made on his arrival, he would be that much closer to his objective; and if the house were there to begin with, he would achieve his desire immediately. He would be further advanced toward his goal without the necessity of further restriction of consumption.

  Now, what about education and the arts? Should we include them in the subsistence fund? Without the availability of consumer goods that sustain individuals, education and the arts are likely to be lower on individuals’ priority lists.

  Once the individuals’ living standard increases, all these things become affordable to them. Hence, anything that undermines the subsistence fund undermines the ability to live like human beings, as opposed to existing like other animals.

  The Purchasing Power of Financial Assets and Monetary Liquidity

  An important factor that causes fluctuations in financial asset prices is monetary liquidity. Monetary liquidity depicts the interaction between the supply and the demand for money. Now, the increase in liquidity—an increase in the supply of money relative to the demand for money—does not enter all asset markets instantaneously. It enters various markets sequentially. Note that the price of an asset is the amount of money paid for the asset.

  When money enters a particular asset market, there is now more money per unit of the asset. This means that the price of the asset in this market has gone up. After a time lapse, once investors have adopted the view that the asset is overvalued, they move the monetary liquidity to other asset markets. This shows that there is a time lag between changes in liquidity and changes in the average price of assets.

  Observe that the increase in the momentum of asset prices is driven by the increase in the lagged liquidity momentum. Conversely, a decline in the liquidity momentum after a time lag results in a decline in the momentum of asset prices. It would appear that the monetary liquidity is the key driver of asset prices. This is not the case. The pool of real savings, which gives rise to economic growth, determines the purchasing power of assets in money terms.

  Notwithstanding the popular view that increases in the money supply can help grow the economy, money cannot do such things. More money cannot replace real savings that sustain individuals in the various stages of production. According to  Rothbard, this is revealed once the pool of real savings starts to decline and the central bank’s monetary pumping becomes ineffective in reviving the pace of economic activity.

  In the framework of market-selected money such as gold and in the absence of a central bank, an increase in assets’ purchasing power is going to reflect an increase in the pool of real savings and thus economic growth.

  Central bank policies, however, curtail investors’ ability to distinguish wealth-generating activities from non-wealth-generating ones; i.e., bubble activities. An increase in money supply masquerades as an increase in real wealth. This results in erroneous investment decisions. Hence, all other things being equal, the exchange value of assets is set by the pool of real savings. Changes in monetary liquidity because of central bank policies cause disruptions known as bull-bear markets.

  Summary and Conclusions

  An important factor that appears to drive financial asset prices is monetary liquidity, defined as the growth rate in money supply minus the growth rate in the demand for money. This is not the case. The pool of real savings gives rise to economic growth, which for a given stock of money determines the purchasing power of assets.

  Tyler Durden
  Tue, 01/10/2023 – 18:45

• Apartment Demand "Evaporated" As Inflation Crushed Consumer Confidence
  Apartment Demand “Evaporated” As Inflation Crushed Consumer Confidence

  Property management firm RealPage published new data that shows demand for US apartments began “evaporating” as early as last summer as the highest inflation in a generation crushed consumer confidence.

  “We’ve never before seen a period like this – weak demand for all types of housing despite robust job growth and sizable wage gains,” RealPage Chief Economist Jay Parsons told commercial real estate news website “GlobeSt.” 

  “It wasn’t just apartment demand that shot up in 2021 and plunged in 2022. The same pattern played out to varying degrees in other rentals and in for-sale homes,” Parsons said. 

  Parsons noted, “while some pundits have suggested demand is slowing due to affordability challenges, there’s not yet any evidence that’s true within the professionally managed, market-rate apartment market.” He said turnover, while normalizing, is still very low, and about 96% of renters were paying on time as of November. 

  In addition, “there’s no indication renters are doubling up to any significant degree,” he said, adding, “that may occur later, but as the publicly traded apartment REITs all reported in their last earnings call, it’s not a major factor yet.” 

  Parsons pointed out, “there’s no ‘flight to affordability’ – meaning that renters aren’t moving down from more expensive units or markets into more affordable units or markets” and said sliding demand is at all price points and every market. 

  RealPage’s top economist believes plunging demand is the cause of macroeconomic headwinds denting consumer confidence:

  “Low consumer confidence means many American households feel nervous and uncertain, and that has a freezing effect on household formation and housing demand.

  “Human nature is that when we feel uncertain, we’re much more likely to stay put – and that’s what happened in 2022.”

  Separately, Parsons tweeted an image that shows rental demand “evaporated” in the second half of last year. 

  “Both Q3 and Q4 recorded the weakest numbers since 2013. The Dec 2022 numbers were especially low. While December is always slow, Dec 2022 was the slowest month in at least 12 years,” he said. 

  

  Parsons continued in a series of tweets about how the collapse in rental demand is “truly unprecedented.” 

  

  Recall back in October, we explained to readers when it comes to measuring inflation, the Fed Reserve is looking at inaccurate and out-of-date data, the result of Shelter Inflation and Owner Equivalent Rent – the most significant weight of the CPI basket – being about 9-12 months behind the curve when it comes what’s really happening in the housing market. 

  Indeed, as we recently said in “Why The CPI Is Making The Same Huge Mistake Now It Did One Year Ago,” the time to panic about soaring rent was more than a year ago — as we noted in September 2021 – but not the Fed which was busy spreading fake news that inflation was transitory. And now what’s happening is that BLS is finally caught up to the reality 6-9 months ago when rents and home prices were indeed soaring… meanwhile, rental markets are cooling across the country as the US risks sliding into a Fed-induced recession. 

  RealPage’s data and the mounting evidence we’ve provided over the last few quarters shows the Fed chooses to ignore high-frequency data for laggard data in how it views the shelter inflation situation. Of course, the Fed will realize when it’s too late that it overtightened.  

  And perhaps Fed Chair Powell should take a look at Goldman Sachs’ CPI preview for this week, where chief economist Jan Hatzius is certainly paying attention to high-frequency rent data that has all but gone negative on an annualized basis, an indication CPI shelter inflation could begin to recede as early as December. 

  

  Pro subs can read the full note in the usual place. 

  Tyler Durden
  Tue, 01/10/2023 – 18:25

• Tverberg: In 2023, Expect A Financial Crash Followed By Major Energy-Related Changes
  Tverberg: In 2023, Expect A Financial Crash Followed By Major Energy-Related Changes

  Authored by Gail Tverberg via Our Finite World blog,

  Why is the economy headed for a financial crash? It appears to me that the world economy hit Limits to Growth about 2018 because of a combination of diminishing returns in resource extraction together with rising population. The Covid-19 pandemic and the accompanying financial manipulations hid these problems for a few years, but now, as the world economy tries to reopen, the problems are back with a vengeance.

  

  Figure 1. World primary energy consumption per capita based on BP’s 2022 Statistical Review of World Energy. Same chart shown in post, Today’s Energy Crisis Is Very Different from the Energy Crisis of 2005.

  In the period between 1981 and 2022, the economy was lubricated by a combination of ever-rising debt, falling interest rates, and the growing use of Quantitative Easing. These financial manipulations helped to hide the rising cost of fossil fuel extraction after 1970. Even more money supply was added in 2020. Now central bankers are trying to squeeze the excesses out of the system using a combination of higher interest rates and Quantitative Tightening.

  After central bankers brought about recessions in the past, the world economy was able to recover by adding more energy supply. However, this time we are dealing with a situation of true depletion; there is no good way to recover by adding more energy supplies to the system. Instead, the only way the world economy can recover, at least partially, is by squeezing some non-essential energy uses out of the system. Hopefully, this can be done in such a way that a substantial part of the world economy can continue to operate in a manner close to that in the past.

  One approach to making the economy more efficient in its energy use is by greater regionalization. If countries can start trading almost entirely with nearby neighbors, this will reduce the world’s energy consumption. In parts of the world with plentiful resources and manufacturing capability, the economy can perhaps continue without major changes. Another way of squeezing out excesses might be through the elimination (at least in part) of the trade advantage the US obtains by using the dollar as the world’s reserve currency. In this post, I will also mention a few other ways that non-essential energy consumption might be reduced.

  I believe that a financial crash is likely sometime during 2023. After the crash, the system will start squeezing down on the less necessary parts of the economy. While these changes will start in 2023, they will likely take place over a period of years. In this post, I will try to explain what I see happening.

  [1] The world economy, in its currently highly leveraged state, cannot withstand both higher interest rates and Quantitative Tightening.

  With higher interest rates, the value of bonds falls. With bonds “worth less,” the financial statements of pension plans, insurance companies, banks and others holding those bonds all look worse. More contributions are suddenly needed to fund pension funds. Governments may find themselves needing to bail out many of these organizations.

  At the same time, individual borrowers find that debt becomes more expensive to finance. Thus, it becomes more expensive to buy a home, vehicle, or farm. Debt to speculate in the stock market becomes more expensive. With higher debt costs, there is a tendency for asset prices, such as home prices and stock prices, to fall. With this combination (lower asset prices and higher interest rates) debt defaults are likely to become more common.

  Quantitative Tightening makes it harder to obtain liquidity to buy goods internationally. This change is more subtle, but it also works in the direction of causing disruptions to financial markets.

  Other stresses to the financial system can be expected, as well, in the near term. For example, Biden’s program that allows students to delay payments on their student loans will be ending in the next few months, adding more stress to the system. China has had huge problems with loans to property developers, and these may continue or get worse. Many of the poor countries around the world are asking the IMF to provide debt relief because they cannot afford energy supplies and other materials at today’s prices. Europe is concerned about possible high energy prices.

  This is all happening at a time when total debt levels are even higher than they were in 2008. In addition to “regular” debt, the economic system includes trillions of dollars of derivative promises. Based on these considerations alone, a much worse crash than occurred in 2008 seems possible.

  [2] The world as a whole is already headed into a major recession. This situation seems likely to get worse in 2023.

  The Global Purchasing Managers Index (PMI) has been signaling problems for months. A few bullet points from their site include the following:

  • Service sector output declined in October, registering the worst monthly performance since mid-2020.

  • Manufacturing output meanwhile fell for a third consecutive month, also declining at the steepest rate since June 2020.

  • PMI subindices showed new business contracting at the quickest rate since June 2020, with the weak demand environment continuing to be underpinned by declining worldwide trade.

  • The global manufacturing PMI’s new export orders index has now signaled a reduction in worldwide goods exports for eight straight months.

  • Price inflationary pressures remained solid in October, despite rates of increase in input costs and output charges easing to 19-month lows.

  The economic situation in the US doesn’t look as bad as it does for the world as a whole, perhaps because the US dollar has been at a relatively high level. However, a situation with the US doing well and other countries doing poorly is unsustainable. If nothing else, the US needs to be able to buy raw materials and to sell finished goods and services to these other countries. Thus, recession can be expected to spread.

  [3] The underlying issue that the world is starting to experience is overshoot and collapse, related to a combination of rising population and diminishing returns with respect to resource extraction.

  In a recent post, I explained that the world seems to be reaching the limits of fossil fuel extraction. So-called renewables are not doing much to supplement fossil fuels. As a result, energy consumption per capita seems to have hit a peak in 2018 (Figure 1) and now cannot keep up with population growth without prices that rise to the point of becoming unaffordable for consumers.

  The economy, like the human body, is a self-organizing system powered by energy. In physics terminology, both are dissipative structures. We humans can get along for a while with less food (our source of energy), but we will lose weight. Without enough food, we are more likely to catch illnesses. We might even die, if the lack of food is severe enough.

  The world economy can perhaps get along with less energy for a while, but it will behave strangely. It needs to cut back, in a way that might be thought of as being analogous to a human losing weight, on a permanent basis. On Figure 1 (above), we can see evidence of two temporary cutbacks. One was in 2009, reflecting the impact of the Great Financial Crisis of 2008-2009. Another related to the changes associated with Covid-19 in 2020.

  If energy supply is really reaching extraction limits, and this is causing the recent inflation, there needs to be a permanent way of cutting back energy consumption, relative to the output of the economy. I expect that changes in this direction will start happening about the time of the upcoming financial crash.

  [4] A major financial crash in 2023 may adversely affect many people’s ability to buy goods and services.

  A financial discontinuity, including major defaults that spread from country to country, is certain to adversely affect banks, insurance companies and pension plans. If problems are widespread, governments may not be able to bail out all these institutions. This, by itself, may make the purchasing of goods and services more difficult. Citizens may find that the funds they thought were in the bank are subject to daily withdrawal limits, or they may find that the value of shares of stock they owned is much lower. As a result of such changes, they will not have the funds to buy the goods they want, even if the goods are available in shops.

  Alternatively, citizens may find that their local governments have issued so much money (to try to bail out all these institutions) that there is hyperinflation. In such a case, there may be plenty of money available, but very few goods to buy. As a result, it still may be very difficult to buy the goods a family needs.

  [5] Many people believe that oil prices will rise in response to falling production. If the real issue is that the world is reaching extraction limits, the problem may be inadequate demand and falling prices instead.

  If people have less to spend following the financial crash, based on the reasoning in Section [4], this could lead to lower demand, and thus lower prices.

  It also might be noted that both the 2009 and 2020 dips in consumption (on Figure 1) corresponded to times of low oil prices, not high. Oil companies cut back on production if they find that prices are too low for them to expect to make a profit on new production.

  We also know that a major problem as limits are reached is wage disparity. The wealthy use more energy products than poor people, but not in proportion to their higher wealth. The wealthy tend to buy more services, such as health care and education, which are not as energy intensive.

  If the poor get too poor, they find that they must cut back on things like meat consumption, housing expenses, and transportation expenses. All these things are energy intensive. If very many poor people cut back on products that indirectly require energy consumption, the prices for oil and other energy products are likely to fall, perhaps below the level required by producers for profitability.

  [6] If I am right about low energy prices, especially after a financial discontinuity, we can expect oil, coal, and natural gas production to fall in 2023.

  Producers tend to produce less oil, coal and natural gas if prices are too low.

  Also, government leaders know that high energy prices (especially oil prices) lead to high food prices and high inflation. If they want to be re-elected, they will do everything in their power to keep energy prices down.

  [7] Without enough energy to go around, more conflict can be expected.

  Additional conflict can be expected to come in many forms. It can look like local demonstrations by citizens who are unhappy about their wages or other conditions. If wage disparity is a problem, it will be the low-wage workers who will be demonstrating. I understand that demonstrations in Europe have recently been a problem.

  Conflict can also take the form of wide differences among political parties, and even within political parties. The difficulty that the US recently encountered electing a Speaker of the House of Representatives is an example of such conflict. Political parties may splinter, making it difficult to form a government and get any business accomplished.

  Conflict may also take the form of conflict among countries, such as the conflict between Russia and Ukraine. I expect most wars today will be undeclared wars. With less energy to go around, the emphasis will be on approaches that require less energy. Deception will become important. Destruction of another country’s energy infrastructure, such as pipelines or electricity transmission, may be part of the plan. Another form of deception may involve the use of bioweapons and supposed cures for these bioweapons.

  [8] After the discontinuity, the world economy is likely to become more disconnected and more regionally aligned. Russia and China will tend to be aligned. The US seems likely to be another center of influence.

  A major use of oil is transporting goods and people around the globe. If there is not enough oil to go around, one way of saving oil is to transport goods over shorter distances. People can talk by telephone or video conferences to save on oil used in long distance transportation. Thus, increased regionalization seems likely to take place.

  In fact, the pattern is already beginning. Russia and China have recently been forging long-term alliances centered on providing natural gas supplies to China and on strengthening military ties. Being geographically adjacent is clearly helpful. Furthermore, major US oil companies are now focusing more on developments in the Americas, rather than on big international projects, according to the Wall Street Journal.

  Countries that are geographically close to Russia-China may choose to align with them, especially if they have resources or finished products (such as televisions or cars) to sell. Likewise, countries near the US with suitable products to sell may align with the United States.

  Countries that are too distant, or that don’t have resources or finished products to sell (goods, rather than services), may largely be left out. For example, European countries that specialize in financial services and tourism may have difficulty finding trading partners. Their economies may shrink more rapidly than those of other countries.

  [9] In a regionally aligned world, the US dollar is likely to lose its status as the world’s reserve currency.

  With increased regionalization, I would expect that the US dollar’s role as the world’s reserve currency would tend to disappear, perhaps starting as soon as 2023. For example, transactions between Russia and China may begin to take place directly in yuan, without reference to a price in US dollars, and without the need for US funds to allow such transactions to take place.

  Transactions within the Americas seem likely to continue taking place using US dollars, especially when they involve the buying and selling of energy-related products.

  With the US dollar as the reserve currency, the US has been able to import far more than it exports, year after year. Based on World Bank data, in 2021 the US imported $2.85 trillion of goods (including fossil fuels, but excluding services) and exported $1.76 trillion of goods, leading to a goods-only excess of imports over exports of $1.09 trillion. When exports of services are included, the excess of imports over exports shrinks to “only” $845 billion. It is hard to see how this large a gap can continue. Such a significant difference between imports and exports would tend to shrink if the US were to lose its reserve currency status.

  [10] In a disconnected world, manufacturing of all kinds will fall, especially outside of Southeast Asia (including China and India), where a major share of today’s manufacturing is performed.

  A huge share of today’s manufacturing capability is now in China and India. If these countries have access to oil from the Middle East and Russia, I expect they will continue to produce goods and services. If there are not enough of these goods to go around, I would expect that they would primarily be exported to other countries within their own geographic region.

  The Americas and Europe will be at a disadvantage because they have fewer manufactured goods to sell. (The US, of course, has a significant quantity of food to export.) Starting in the 1980s, the US and Europe moved a large share of their manufacturing to Southeast Asia. Now, when these countries talk about ramping up clean energy production, they find that they are largely without the resources and the processing needed for such clean energy projects.

  

  Figure 2: New York Times chart based on International Energy Agency data. February 22, 2022.

  In fact, ramping up “regular” manufacturing production of any type in the US, (for example, local manufacturing of generic pharmaceutical drugs, or manufacturing of steel pipe used in the drilling of oil wells) would not be easy. Most of today’s manufacturing capability is elsewhere. Even if the materials could easily be gathered into one place in the US, it would take time to get factories up and running and to train workers. If some necessary items are lacking, such as particular raw materials or semiconductor chips, transitioning to US manufacturing capability might prove to be impossible in practice.

  [11] After a financial discontinuity, “empty shelves” are likely to become increasingly prevalent.

  We can expect that the total quantity of goods and services produced worldwide will begin to fall for several reasons. First, regionalized economies cannot access as diverse a set of raw materials as a world economy. This, by itself, will limit the types of goods that an economy can produce. Second, if the total quantity of raw materials used in making the inputs declines over time, the total amount of finished goods and services can be expected to fall. Finally, as mentioned in Section [4], financial problems may cut back on buyers’ ability to purchase goods and services, limiting the number of buyers available for finished products, and thus holding down sales prices.

  A major reason empty shelves become can be expected to become more prevalent is because more distant countries will tend to get cut out of the distribution of goods. This is especially the case as the total quantity of goods and services produced falls. A huge share of the manufacturing of goods is now done in China, India, and other countries in Southeast Asia.

  If the world economy shifts toward mostly local trade, the US and Europe are likely to find it harder to find new computers and new cell phones since these tend to be manufactured in Southeast Asia. Other goods made in Southeast Asia include furniture and appliances. These, too, may be harder to find. Even replacement car parts may be difficult to find, especially if a car was manufactured in Southeast Asia.

  [12] There seem to be many other ways the self-organizing economy could shrink back to make itself a more efficient dissipative structure.

  We cannot know in advance exactly how the economy will shrink back its energy consumption, besides regionalization and pushing the US dollar (at least partially) out of being the reserve currency. Some other areas where the physics of the economy might force cutbacks include the following:

  • Vacation travel

  • Banks, insurance companies, pension programs (much less needed)

  • The use of financial leverage of all kinds

  • Governmental programs providing payments to those not actively in the workforce (such as pensions, unemployment insurance, disability payments)

  • Higher education programs (many graduates today cannot get jobs that pay for the high cost of their educations)

  • Extensive healthcare programs, especially for people who have no hope of ever re-entering the workforce

  In fact, the population may start to fall because of epidemics, poor health, or even too little food. With fewer people, limited energy supply will go further.

  Governments and intergovernmental agencies may start to fail because they cannot get enough tax revenue. Of course, the underlying issue for the lack of tax revenue is likely to be that the businesses within the governed area cannot operate because they cannot obtain enough inexpensive energy resources for operation.

  [13] Conclusion.

  If the world economy experiences major financial turbulence in 2023, we could be in for a rough ride. In my opinion, a major financial crash seems likely. This is could upset the economy far more seriously than the 2008 crash.

  I am certain that some mitigation measures can be implemented. For example, there could be a major push toward trying to make everything that we have today last longer. Materials can be salvaged from structures that are no longer used. And some types of local production can be ramped up.

  We can keep our fingers crossed that I am wrong but, with fewer oil and other energy resources available per person, moving goods shorter distances makes sense. Thus, the initial trends we are seeing toward regionalization are likely to continue. The move away from the US dollar as the reserve currency also looks likely to continue. Moreover, if the changes I am talking about don’t occur in 2023, they are likely to begin in 2024 or 2025.

  Tyler Durden
  Tue, 01/10/2023 – 18:05

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