Today’s News 16th June 2022

• These Are The Ports Still Receiving The Most Russian Fossil-Fuel Shipments?
  These Are The Ports Still Receiving The Most Russian Fossil-Fuel Shipments?

  As the invasion of Ukraine wears on, European countries are scrambling to find alternatives to Russian fossil fuels.

  In fact, an estimated 93% of Russian oil sales to the EU are due to be eliminated by the end of the year, and many countries have seen their imports of Russian gas plummet. Despite this, Russia earned €93 billion in revenue from fossil fuel exports in the first 100 days of the invasion.

  While the bulk of fossil fuels travel through Europe via pipelines, Visual Capitalist’s Nick Routley details below, there are still a number marine shipments moving between ports. The maps below, using data from MarineTraffic.com and Datalastic, compiled by the Centre for Research on Energy and Clean Air (CREA), are a look at Russia’s fossil fuel shipments during the first 100 days of the invasion.

  Russia’s Crude Oil Shipments

  Much of Russia’s marine shipments of crude oil went to the Netherlands and Italy, but crude was also shipped as far away as India and South Korea.

  

  India became a significant importer of Russian crude oil, buying 18% of the country’s exports (up from just 1%). From a big picture perspective, India and China now account for about half of Russia’s marine-based oil exports.

  It’s important to note that a broad mix of companies were involved in shipping this oil, with some of the companies tapering their trade activity with Russia over time. Even as shipments begin to shift away from Europe though, European tankers are still doing the majority of the shipping.

  Russia’s Liquefied Natural Gas Shipments

  Unlike the gas that flows along the many pipeline routes traversing Europe, liquefied natural gas (LNG) is cooled down to a liquid form for ease and safety of transport by sea. Below, we can see that shipments went to a variety of destinations in Europe and Asia.

  

  Fluxys terminals in France and Belgium stand out as the main destinations for Russian LNG deliveries.

  Russia’s Oil Product Shipments

  For crude oil tankers and LNG tankers, the type of cargo is known. For this dataset, CREA assumed that oil products tankers and oil/chemical tankers were carrying oil products.

  

  Huge ports in Rotterdam and Antwerp, which house major refineries, were the destination for many of these oil products. Some shipments also went to destinations around the Mediterranean as well.

  All of the top ports in this category were located within the vicinity of Europe.

  Russia’s Coal Shipments

  Finally, we look at marine-based coal shipments from Russia. For this category, CREA identified 25 “coal export terminals” within Russian ports. These are specific port locations that are associated with loading coal, so when a vessel takes on cargo at one of these locations, it is assumed that the shipment is a coal shipment.

  

  The European Union has proposed a Russian coal ban that is expected to take effect in August. While this may seem like a slow reaction, it’s one example of how the invasion of Ukraine is throwing large-scale, complex supply chains into disarray.

  With such a heavy reliance on Russian fossil fuels, the EU will be have a busy year trying to secure substitute fuels – particularly if the conflict in Ukraine continues to drag on.

  Tyler Durden
  Thu, 06/16/2022 – 02:45

• UK Flight Taking Illegal Immigrants To Rwanda Halted By European Court Of Human Rights
  UK Flight Taking Illegal Immigrants To Rwanda Halted By European Court Of Human Rights

  Authored by Alexander Zhang via The Epoch Times,

  A flight due to take illegal immigrants from the UK to Rwanda was halted on Tuesday after last-minute interventions by the European Court of Human Rights (ECHR).

  

  Prime Minister Boris Johnson announced on April 14 that people who enter the UK illegally, including those who cross the English Channel in small boats, may end up being relocated to the African country of Rwanda. The UK government said the move is necessary to deter human smuggling.

  Pro-immigration activists have argued that the policy is inhumane and unlawful, but the UK courts rejected a request for an interim injunction to stop the Rwanda flight, which was due to take off on Tuesday night.

  But the flight was grounded after the ECHR said it had granted an urgent interim measure in regards to an Iraqi national who was due to be on the flight.

  It said the individual concerned should not be removed to Rwanda until three weeks after the delivery of the final domestic decision in his ongoing judicial review proceedings.

  UK Home Secretary Priti Patel described the ECHR’s intervention as “very surprising,” but insisted that the government will not be deterred.

  She said:

  “We will not be deterred from doing the right thing and delivering our plans to control our nation’s borders. Our legal team are reviewing every decision made on this flight and preparation for the next flight begins now.”

  The main opposition Labour Party said ministers have only themselves to blame for what happened.

  “They have pushed ahead with a policy they knew was unworkable, unethical, and incredibly expensive because they just wanted a row and someone else to blame,” said shadow home secretary Yvette Cooper.

  Earlier, Johnson highlighted the legal profession as the main source of opposition to the Rwanda policy, and suggested lawyers trying to stop deportations of illegal immigrants are “abetting the work of criminal gangs.”

  Talking to Sky News on Wednesday, Work and Pensions Secretary Therese Coffey said the government is “highly confident” that the next deportation flight to Rwanda will go ahead.

  The Rwandan government, who has agreed to accommodate the illegal immigrants under a partnership with the UK, also said it is “not deterred by these developments.”

  Government spokeswoman Yolande Makolo said: “Rwanda remains fully committed to making this partnership work. The current situation of people making dangerous journeys cannot continue as it is causing untold suffering to so many.

  “Rwanda stands ready to receive the migrants when they do arrive and offer them safety and opportunity in our country.”

  Tyler Durden
  Thu, 06/16/2022 – 02:00

• Red Flagged Nation: Gun Confiscation Laws Put A Target On Every American's Back
  Red Flagged Nation: Gun Confiscation Laws Put A Target On Every American’s Back

  Authored by John W. Whitehead & Nisha Whitehead via The Rutherford Institute,

  “We are fast approaching the stage of the ultimate inversion: the stage where the government is free to do anything it pleases, while the citizens may act only by permission; which is the stage of the darkest periods of human history, the stage of rule by brute force.” 

  – Ayn Rand

  What we do not need is yet another pretext by which government officials can violate the Fourth Amendment at will under the guise of public health and safety.

  

  Indeed, at a time when red flag gun laws (which authorize government officials to seize guns from individuals viewed as a danger to themselves or others) are gaining traction as a legislative means by which to allow police to remove guns from people suspected of being threats, it wouldn’t take much for police to be given the green light to enter a home without a warrant in order to seize lawfully-possessed firearms based on concerns that the guns might pose a danger.

  Frankly, a person wouldn’t even need to own a gun to be subjected to such a home invasion.

  SWAT teams have crashed through doors on lesser pretexts based on false information, mistaken identities and wrong addresses.

  Nineteen states and the District of Columbia have adopted laws allowing the police to remove guns from people suspected of being threats. If Congress succeeds in passing the Federal Extreme Risk Protection Order, which would nationalize red flag laws, that number will grow.

  As The Washington Post reports, these red flag gun laws “allow a family member, roommate, beau, law enforcement officer or any type of medical professional to file a petition [with a court] asking that a person’s home be temporarily cleared of firearms. It doesn’t require a mental-health diagnosis or an arrest.”

  In the wake of yet another round of mass shootings, these gun confiscation laws—extreme risk protection order (ERPO) laws—may appease the fears of those who believe that fewer guns in the hands of the general populace will make our society safer.

  Of course, it doesn’t always work that way.

  Anything—knives, vehicles, planes, pressure cookers—can become a weapon when wielded with deadly intentions.

  With these red flag gun laws, the stated intention is to disarm individuals who are potential threats… to “stop dangerous people before they act.”

  While in theory it appears perfectly reasonable to want to disarm individuals who are clearly suicidal and/or pose an “immediate danger” to themselves or others, where the problem arises is when you put the power to determine who is a potential danger in the hands of government agencies, the courts and the police.

  We’ve been down this road before.

  Remember, this is the same government that uses the words “anti-government,” “extremist” and “terrorist” interchangeably.

  This is the same government whose agents are spinning a sticky spider-web of threat assessments, behavioral sensing warnings, flagged “words,” and “suspicious” activity reports using automated eyes and ears, social media, behavior sensing software, and citizen spies to identify potential threats.

  This is the same government that has a growing list—shared with fusion centers and law enforcement agencies—of ideologies, behaviors, affiliations and other characteristics that could flag someone as suspicious and result in their being labeled potential enemies of the state.

  For instance, if you believe in and exercise your rights under the Constitution (namely, your right to speak freely, worship freely, associate with like-minded individuals who share your political views, criticize the government, own a weapon, demand a warrant before being questioned or searched, or any other activity viewed as potentially anti-government, racist, bigoted, anarchic or sovereign), you could be at the top of the government’s terrorism watch list.

  Moreover, as a New York Times editorial warns, you may be an anti-government extremist (a.k.a. domestic terrorist) in the eyes of the police if you are afraid that the government is plotting to confiscate your firearms, if you believe the economy is about to collapse and the government will soon declare martial law, or if you display an unusual number of political and/or ideological bumper stickers on your car.

  Let that sink in a moment.

  Now consider the ramifications of giving police that kind of authority: to preemptively raid homes in order to neutralize a potential threat.

  It’s a powder keg waiting for a lit match.

  Under these red flag laws, what happened to Duncan Lemp—who was gunned down in his bedroom during an early morning, no-knock SWAT team raid on his family’s home—could very well happen to more people.

  At 4:30 a.m. on March 12, 2020, in the midst of a COVID-19 pandemic that had most of the country under a partial lockdown and sheltering at home, a masked SWAT team—deployed to execute a “high risk” search warrant for unauthorized firearms—stormed the suburban house where 21-year-old Duncan, a software engineer and Second Amendment advocate, lived with his parents and 19-year-old brother.

  The entire household, including Lemp and his girlfriend, was reportedly asleep when the SWAT team directed flash bang grenades and gunfire through Lemp’s bedroom window.

  Lemp was killed and his girlfriend injured.

  No one in the house that morning, including Lemp, had a criminal record.

  No one in the house that morning, including Lemp, was considered an “imminent threat” to law enforcement or the public, at least not according to the search warrant.

  So what was so urgent that militarized police felt compelled to employ battlefield tactics in the pre-dawn hours of a day when most people are asleep in bed, not to mention stuck at home as part of a nationwide lockdown?

  According to police, they were tipped off that Lemp was in possession of “firearms.”

  Thus, rather than approaching the house by the front door at a reasonable hour in order to investigate this complaint—which is what the Fourth Amendment requires—police instead strapped on their guns, loaded up their flash bang grenades and carried out a no-knock raid on the household.

  According to the county report, the no-knock raid was justified “due to Lemp being ‘anti-government,’ ‘anti-police,’ currently in possession of body armor, and an active member of the Three Percenters,” a far-right paramilitary group that discussed government resistance.

  This is what happens when you adopt red flag gun laws, painting anyone who might be in possession of a gun—legal or otherwise—as a threat that must be neutralized.

  Therein lies the danger of these red flag laws, specifically, and pre-crime laws such as these generally where the burden of proof is reversed and you are guilty before you are given any chance to prove you are innocent.

  Red flag gun laws merely push us that much closer towards a suspect society where everyone is potentially guilty of some crime or another and must be preemptively rendered harmless.

  Where many Americans go wrong is in naively assuming that you have to be doing something illegal or harmful in order to be flagged and targeted for some form of intervention or detention.

  In fact, all you need to do these days to end up on a government watch list or be subjected to heightened scrutiny is use certain trigger words (like cloud, pork and pirates), surf the internet, communicate using a cell phone, limp or stutter, drive a car, stay at a hotel, attend a political rally, express yourself on social media, appear mentally ill, serve in the military, disagree with a law enforcement official, call in sick to work, purchase materials at a hardware store, take flying or boating lessons, appear suspicious, appear confused or nervous, fidget or whistle or smell bad, be seen in public waving a toy gun or anything remotely resembling a gun (such as a water nozzle or a remote control or a walking cane), stare at a police officer, question government authority, appear to be pro-gun or pro-freedom, or generally live in the United States.

  Be warned: once you get on such a government watch list—whether it’s a terrorist watch list, a mental health watch list, a dissident watch list, or a red flag gun watch list—there’s no clear-cut way to get off, whether or not you should actually be on there.

  You will be flagged as a potential threat and dealt with accordingly.

  You will be tracked by the government’s pre-crime, surveillance network wherever you go.

  Hopefully you’re starting to understand how easy we’ve made it for the government to identify, label, target, defuse and detain anyone it views as a potential threat for a variety of reasons that run the gamut from mental illness to having a military background to challenging its authority to just being on the government’s list of persona non grata.

  The government has been building its pre-crime, surveillance network in concert with fusion centers (of which there are 78 nationwide, with partners in the private sector and globally), data collection agencies, behavioral scientists, corporations, social media, and community organizers and by relying on cutting-edge technology for surveillance, facial recognition, predictive policing, biometrics, and behavioral epigenetics (in which life experiences alter one’s genetic makeup).

  Combine red flag laws with the government’s surveillance networks and its plan to establish an agency that will take the lead in identifying and targeting “signs” of mental illness or violent inclinations among the populace by using artificial intelligence to collect data from Apple Watches, Fitbits, Amazon Echo and Google Home, and you’ll understand why some might view gun control legislation with trepidation.

  No matter how well-meaning the politicians make these encroachments on our rights appear, in the right (or wrong) hands, benevolent plans can easily be put to malevolent purposes.

  As I make clear in my book Battlefield America: The War on the American People and in its fictional counterpart The Erik Blair Diaries, even the most well-intentioned government law or program can be—and has been—perverted, corrupted and used to advance illegitimate purposes once profit and power are added to the equation.

  The war on terror, the war on drugs, the war on illegal immigration, the war on COVID-19: all of these programs started out as legitimate responses to pressing concerns and have since become weapons of compliance and control in the government’s hands.

  No matter how well-intentioned, red flag gun laws will put a target on the back of every American whether or not they own a weapon.

  Tyler Durden
  Wed, 06/15/2022 – 23:40

• What Drives Gasoline Prices?
  What Drives Gasoline Prices?

  Across the United States, the cost of gas has been a hot topic of conversation lately, as prices reach record-breaking highs.

  The national average now sits at $5.00 per gallon, and by the end of summer, this figure could grow to $6 per gallon, according to estimates by JPMorgan.

  But, as Visual Capitalist’s Carmen Ang details below, before we can have an understanding of what’s happening at the pump, it’s important to first know what key factors influence gasoline prices.

  This graphic, using data from the U.S. Energy Information Administration (EIA), outlines the main components that influence gasoline prices, providing each factor’s proportional impact on price.

  

  The Four Main Factors

  According to the EIA, there are four main factors that influence the price of gas:

  • Crude oil prices (54%)

  • Refining costs (14%)

  • Taxes (16%)

  • Distribution, and marketing costs (16%)

  More than half the cost of filling your tank is influenced by the price of crude oil. Meanwhile, the rest of the price at the pump is split fairly equally between refining costs, marketing and distribution, and taxes.

  Let’s look at each factor in more depth.

  Crude Oil Prices

  The most influential factor is the cost of crude oil, which is largely dictated by international supply and demand.

  Despite being the world’s largest oil producer, the U.S. remains a net importer of crude oil, with the majority coming from Canada, Mexico, and Saudi Arabia. Because of America’s reliance on imports, U.S. gas prices are largely influenced by the global crude oil market.

  A number of geopolitical factors can influence the crude oil market, but one of the biggest influences is the Organization of the Petroleum Exporting Countries (OPEC), led by Saudi Arabia.

  Established in 1960, OPEC was created to combat U.S. dominance of the global oil market. OPEC sets production targets for its 13 member countries, and historically, oil prices have been linked to changes in OPEC production. Today, OPEC countries are responsible for about 60% of internationally traded petroleum.

  Refining Costs

  Oil needs to be refined into gasoline before it can be used by consumers, which is why refining costs are factored into the price of gas.

  The U.S. has hundreds of refineries across the country. The country’s largest refinery, owned by the Saudi Arabian company ​​Saudi Aramco, processes around 607,000 barrels of oil per day.

  The exact cost of refining varies, depending on a number of factors such as the type of crude oil used, the processing technology available at the refinery, and the gasoline requirements in specific parts of the country.

  In general, refining capacity in the U.S. has not been keeping up with oil demand. Several refineries shut down throughout the pandemic, but even before COVID-19, refining capacity in the U.S. was lagging behind demand. Incredibly, there haven’t been any brand-new refining facilities built in the country since 1977.

  Taxes

  In the U.S., taxes also play a critical role in determining the price of gas.

  Across America, the average gasoline tax is $0.57 per gallon, however, the exact amount fluctuates from state to state. Here’s a look at the top five states with the highest gas taxes:

  

   

  *Note: figures include both state and federal tax

   

  States with high gas taxes usually spend the extra money on improvements to their infrastructure or local transportation. For instance, Illinois doubled its gas taxes in 2019 as part of a $45 billion infrastructure plan.

  California, the state with the highest tax on gas, is expecting to see a rate increase this July, which will drive gas prices up by around three cents per gallon.

  Distribution and Marketing Costs

  Lastly, the costs of distribution and marketing have an impact on the price of gas.

  Gasoline is typically shipped from refineries to local terminals via pipelines. From there, the gasoline is processed further to ensure it meets market requirements or local government standards.

  Gas stations then distribute the final product to the consumer. The cost of running a gas station varies—some gas stations are owned and operated by brand-name refineries like Chevron, while others are smaller-scale operations owned by independent merchants.

  The big-name brands run a lot of advertisements. According to Morning Consult, Chevron, BP PLC, Exxon Mobil Corp., and Royal Dutch Shell PLC aired TV advertisements in the U.S. more than 44,495 times between June 1, 2020, and Aug. 31, 2021.

  How Does the Russia-Ukraine Conflict Impact U.S. Gas Prices?

  If only a fraction of America’s oil comes from Russia, why is the Russia-Ukraine conflict impacting prices in the U.S.?

  Because oil is bought and sold on a global commodities market. So, when countries imposed sanctions on Russian oil, that put a squeeze on global supply, which ultimately drove up prices.

  This supply shock could keep prices high for a while unless the U.S. falls into a recession, which is a growing possibility based on how recent data is trending.

  Tyler Durden
  Wed, 06/15/2022 – 23:20

• American Business Elites Have Become Lobbyists For China, Expert Says
  American Business Elites Have Become Lobbyists For China, Expert Says

  Authored by Michael Washburn via The Epoch Times (emphasis ours),

  Beijing’s well-documented abusive trade practices, human rights abuses, and territorial aggression have been hard to curb partly because of a lack of alignment between the political and military leadership of democratic nations, on the one hand, and Western business elites engaging in trade with China, on the other, said panelists at a hearing held by the American Enterprise Institute think tank on June 14.

  

  American and European executives tend to allow Beijing’s leaders to lull them into a sense that China’s government is their friend, and changing this false sense is of paramount importance for taking effective action against the Chinese Communist Party’s (CCP) aggression and protecting the national security and economic and political interests of Western powers, the experts said.

  Entitled “Defending Western Economies Against Chinese Unfair Practices,” the hearing featured lengthy testimony from Rep. Darin LaHood (R-Il.), who issued a stark warning about what he sees as the danger China poses to the world.

  “China, from my perspective, is an existential threat in many ways—from a national security standpoint, from an economic standpoint, from a trade standpoint, from a cyber standpoint. I say this often: China has a plan to replace us, economically, militarily, you can go down the list there,” LaHood said.

  But even as Beijing’s rulers harbor ambitions inimical to the interests of the United States, the close economic ties between the powers often prevent some people from seeing the issue clearly, LaHood argued. In the 18^th Congressional district in central Illinois that he represents, LaHood said, the livelihoods of his constituents are heavily dependent on trade with China.

  “I have the eighth largest agricultural district in the country. About a third of the corn and soybeans that my farmers grow go to China every day. I have the largest concentration of Caterpillar workers anywhere in the world. In my district, we make a lot of engines, tractors, and excavators,” LaHood said.

  Caterpillar has 29 manufacturing plants as well as four R&D facilities in China, he pointed out. Given these realities, there is an obvious disconnect between much of the rhetoric heard in Congress, where lawmakers are calling for a Cold War mindset to counter the CCP threat, and the day-to-day reality of a close economic partnership between American laborers and Chinese businesses.

  If the arguments made at the time that China gained entry to the World Trade Organization (WTO) back in 2001 had proven true, and admittance to the body had ushered in a more rules-based, Western-style trading system for China, then the disconnect between the political and economic stances would not be so severe, LaHood contended. But the promises made at the time that Beijing sought entry to the WTO have proven hollow, he said.

  “Overall, they have not adapted to the rules-based system. They continue to steal our intellectual property, they continue to not abide by the same rules and standards that every industrialized country in the world does,” LaHood commented.

  The Psychological Dimension

  China’s elites have grown highly adept at flattering the egos of American business leaders and representatives and keeping the economic relationship deeply entrenched and at odds with U.S. political goals, said James Palmer, the deputy editor of Foreign Policy, a Washington-based magazine. American entrepreneurs feel drawn by the “gravitational pull” of a Chinese market of 1.3 billion consumers and the enormous commercial potential they see there, and the lure of tremendous profits mutes the reaction of U.S. business leaders to rampant abuses such as intellectual property (IP) theft, he said.

  The stealing of IP by Chinese entities has cost the United States an estimated $225 billion to $600 billion per year in recent years, according to the Commission on the Theft of American Intellectual Property.

  “We’ve seen an unwillingness to cooperate with theft, but none of that really dissuades businesses from wanting to get into [the Chinese] market, to get the benefits of cheap labor, and cheap labor unencumbered by unions, because if there’s one thing the CCP hates, it’s unions,” Palmer said.

  When American businesspeople travel to China, they often prove susceptible to assurances about the centrality of the U.S.-China economic partnership and to flattery about their own role in sustaining it, Palmer suggested. It is important to look closely at the way the CCP has targeted Western executives for these kinds of psychological ploys, he said.

  “You arrive in Beijing, you go to the Shangri-La Hotel or the Mandarin Oriental, you’re in a five-star hotel, and you’re surrounded by pleasant young Chinese people who tell you how important you are, how important the U.S-China relationship is, how critical business is to them, and how there are extremists on both sides but you can be the one who speaks to moderation, who becomes the bridge,” Palmer said.

  “And then you come back and you say in [Washington] D.C., oh, the Chinese are really such reasonable people. And you effectively turn yourself into a lobbyist” for the CCP, he added.

  Palmer described this kind of soft offensive targeting American businesspeople as difficult to counter because it is of course not possible or, objectively speaking, desirable to prevent friendly conversations between Chinese and visiting Americans. Business and political leaders must put effective tactics to use. Palmer cited the example of the U.S. sanctions placed on smartphone and high-tech equipment maker Huawei in 2019 as an example of an effective means of responding to abusive Chinese practices.

  “Huawei provided us with some very useful models for sanctions, and sanction tools that have been revitalized and used against Russia,” Palmer said.

  Economic decoupling can also take place as a result of Beijing’s own initiatives, he added. This happens when Chinese officials suffer “internal paranoia” about U.S. influence, or what CCP leaders regard as “American cultural and economic infiltration,” he continued. An example of this is evident in the entertainment industry, where American-made films have a hard time getting past censors screening cinematic product.

  “Hollywood for years was a prime example of an American industry that would do whatever Beijing said in order to gain access, but so few movies are getting permission to get into China now that this is starting to have an effect on Hollywood,” Palmer said.

  Tyler Durden
  Wed, 06/15/2022 – 23:00

• World's Billionaires See $1.4 Trillion In Wealth Evaporate Amid Market Turmoil 
  World’s Billionaires See $1.4 Trillion In Wealth Evaporate Amid Market Turmoil 

  A daily ranking of the world’s richest individuals shows a vast amount of wealth evaporated this year as the Federal Reserve’s missteps in curbing inflation triggered cross-asset implosions. 

  The Bloomberg Billionaires Index of the 500 wealthiest people lost a shocking $1.4 trillion this year alone. On Monday’s stock market rout, billionaires lost $206 billion. 

  Binance CEO Changpeng Zhao experienced the steepest losses amid the crypto meltdown. Bloomberg’s data shows he lost a whopping $85.6 billion as of Tuesday. His total net worth is now only $10.2 billion. 

  Jeff Bezos is next on the list, losing $66.8 billion this year, with a total net worth of $125.5 billion. Mark Zuckerberg lost $64.4 billion, now only worth $60.9 billion. Elon Musk lost $61.6 billion but still secured a solid $208.7 billion stockpile of wealth as the world’s richest person. 

  

  Musk, Bezos, Bernard Arnault (top luxury designer and CEO of luxury goods company LVMH), Bill Gates, and Warren Buffet round out the top five spots for the world’s wealthiest people (all of which happen to be white males). 

  

  The largest gainers of net wealth this year include Indian billionaire Gautam Adani and Dubai-based Swiss billionaire entrepreneur Guillaume Pousaz. 

  

  A separate report via Capgemini World Wealth shows the monetary response by global central banks increased the world’s population of high-net-worth individuals jumped 8% in 2021. It showed that the US, Japan, China, and Germany are home to 64% of the world’s billionaires. 

  Gains in net worth began to reverse in late 2021 when the Federal Reserve and other central banks started to communicate to markets about how an inflation problem (now stagflation storm) would be met with hawkishness (or rate hikes). Global stocks reversed in late December and have been spiraling lower ever since.

  

  It will only take a few oversized rate hikes by the Fed this summer to get recession fears to flourish and market participants to start pricing in the next round of easing — that will be the moment when billionaires get richer. 

  – Zell Tells CNBC He Would Raise Rates a Full Point
  – Gundlach wants 200bps
  – Ackman wants 100bps

  Everyone wants the recession now

  — zerohedge (@zerohedge) June 15, 2022

  https://platform.twitter.com/widgets.js

  Tyler Durden
  Wed, 06/15/2022 – 22:40

• 'Impossible To Continue Operating': Australia’s National Energy Market Suspended
  ‘Impossible To Continue Operating’: Australia’s National Energy Market Suspended

  Authored by Rebecca Zhu via The Epoch Times (emphasis ours),

  The Australian Energy Market Operator (AEMO) has suspended the entire national energy market from June 15 at 2:05 p.m. after it was deemed “impossible” to continue operating the spot market while ensuring a reliable energy supply.

  

  AEMO Chief Executive Daniel Westerman prefaced the announcement by revealing the market operator had been forced to direct 5,000 megawatts of generation through direction interventions yesterday, roughly 20 percent of total demand.

  “In the current situation suspending the market is the best way to ensure a reliable supply of electricity for Australian homes and businesses,” he said in a media release.

  “The situation in recent days has posed challenges to the entire energy industry, and suspending the market would simplify operations during the significant outages across the energy supply chain.”

  Westerman emphasised that the suspension would be temporary and be reviewed daily for each market region. Once the AEMO is able to resume market operation under normal rules, it will do so “as soon as practical.”

  The suspension means the AEMO will take sole charge of dispatching energy to the energy grid and will not need to rely on last-minute interventions.

  The operator will apply a pre-determined pricing schedule for each energy market region and generators may submit an application to AEMO if their costs exceed the suspended market.

  “That visibility will help us to manage the system in real-time as well as to understand the balance of supply and demand,” Westerman told reporters. “Despite this, conditions remain tight in the coming days, in particular in New South Wales (NSW), where we would urge consumers to conserve energy where it is safe to do so.”

  It is the first time the entire national energy market has been suspended since its formation in 1998. However, it has suspended the energy markets in Tasmania and South Australia in 2021, making it “a process that’s familiar to [the AEMO].”

  The national energy market has faced significant challenges from a confluence of factors that led to this decision, including the closure of coal-fired plants, rising international coal and gas prices, and rising demand for heating during the winter season.

  The NSW and Queensland energy ministers have backed both AEMO’s decision, with both saying it would ensure adequate supply across the Eastern states.

  “This decision further reduces the risk of supply shortfalls and unplanned outages,” Queensland Energy Minister Mick de Brenni said. “I can assure Queenslanders there is surplus supply to meet demands in our state and a further generating unit is scheduled to return to service later this week.”

  The Australian Industry Group said worried energy users need confidence in face of the market suspension.

  “The unprecedented suspension of the national electricity market spot market is a clear signal that the energy crisis in Eastern Australia is intensifying,” CEO Innes Willox said in a statement.

  “The detail of the AEMO market suspension will be completely arcane to most business and household energy users. They need confidence that the physical electricity system they depend on will not collapse.”

  Tyler Durden
  Wed, 06/15/2022 – 22:20

• GOP Flips 84%-Hispanic Texas District: First Mexican-Born Woman Elected to Congress
  GOP Flips 84%-Hispanic Texas District: First Mexican-Born Woman Elected to Congress

  In another grim omen for Democrats bracing for an epic November midterm smackdown, the Republican party has flipped a once-solid-blue and 84%-Hispanic district in South Texas.

  In a special election to fill a seat vacated by the incumbent’s resignation, Republican Mayra Flores topped Democrat Dan Sanchez. Flores leads 51% to 43%, with over 95% of the vote tallied as this report is written.

  Flores will be the first Republican to represent that part of Texas since 1870—that’s over 150 years. She also becomes America’s first Mexican-born congresswoman. 

  Her Texas 34th District provides a window on a monumental sea change among Hispanic voters. Consider the trend in presidential victory margins there over the last three elections:

  • 2012: Barack Obama +23%

  • 2016: Hillary Clinton +22% 

  • 2020: Joe Biden +4% 

  

  In November, that trend won’t be confined to the Lone Star state: Nationwide, only 24% of Hispanic voters approve of Biden’s performance, according to a Quinnipiac University poll released last week.

  Today, congressional Latino Democrats condemned their party for blowing the special election and acting as if Mexican-Americans are firmly in the Democrats’ pockets. “They have just forgotten about the brown people on the border,” Texas representative Vicente Gonzalez told Politico. “And that’s basically what it is. I’m not going to try to sugarcoat it anymore. They are taking Latinos in South Texas for granted.”

  Flores also swept the South African-American billionaire vote: New Texan Elon Musk voted for Flores, in his first vote ever for a Republican. 

  Tuesday’s special election was prompted by the resignation of Democrat Filemon Vela. When first elected in 2012, he beat his Republican opponent by 26%. Now, Republican Flores has cruised to a 12-point win.

  She did so embracing thoroughly conservative positions. For example, married to a Border Patrol agent, Flores campaigned on tighter border security, saying:

  “I legally immigrated to America when I was six years old. Living in South Texas offers a unique perspective on illegal immigration and how it affects the livelihood of American citizens. We MUST secure our border to keep bad individuals out and to encourage LEGAL immigration.”

  Coming in the wake of the Uvalde, Texas school massacre, Tuesday’s result may be an indicator of how the gun debate will factor into November’s results. The Flores campaign emphasized her support of gun rights, while Democrat Sanchez argued for more background checks and raising the legal age for firearm ownership to 21.

  It’s telling that Sanchez didn’t embrace a ban on AR-15s and other so-called “assault rifles”: AR-15s are a popular choice for South Texas ranchers in their endless war against destructive feral hogs. 

  Some national Democrats privately complained that a six-figure ad buy for Perez, funded by a super PAC tied to House speaker Nancy Pelosi, attempted to link Flores to “conspiracy theories” surrounding the Jan. 6 “insurrection,” according to Politico. That messaging flop in South Texas comes alongside a major ratings flop for Democrats’ prime-time Jan. 6 hearings.  

  The election also underscores the nationwide enthusiasm gap that favors Republicans in November. In his concession statement, Sanchez noted that he was “outspent by millions of dollars from out-of-state interests and the entire Republican machine.”

  Sanchez also blamed his own party: “Too many factors were against us, including little to no support from the National Democratic Party and the Democratic Congressional Campaign Committee.”

  Having said all that, Flores’ stay in Congress could be brief. This special election was only for the balance of this term, and redistricting means Flores will compete in November on a redrawn map where Biden won by about 15%, rather than 4% on Tuesday’s district map. In that race, she’ll face the earlier-mentioned Vicente Gonzales, who today implored national leaders to get serious in South Texas. 

  Whatever the result in that race, for Democrats who’ve long talked about turning Texas purple, Flores’ victory on Tuesday reinforces a hard truth: the overwhelmingly Latino Texas border regions are indeed turning purple—from blue. And that may soon prove to be an understatement.  

  It has this MSNBC columnist sounding the alarm: 

  There is a political earthquake happening in Latino politics in South Texas and there is a reason I have been saying it will be voting like West Virginia. But like @SeanTrende, I expected this in two decades. #TX34. This should be a five alarm fire for Democrats. https://t.co/hSNO6EilMJ

  — Eric Michael Garcia (@EricMGarcia) June 15, 2022

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  Tyler Durden
  Wed, 06/15/2022 – 22:00

• Victor Davis Hanson: The Subordinate Citizen
  Victor Davis Hanson: The Subordinate Citizen

  Authored by Victor Davis Hanson,

  I recently led a group of about 100 citizens on a tour of Israel for nearly two weeks. Before returning to the United States, all participants had to indicate their vaccination status and take a COVID-19 test for reentry.

  Anxieties swept the group as Israeli testers swabbed them.

  Anyone testing positive would have to delay his or her return.

  That quarantine would entail spending thousands of dollars in finding scarce hotel accommodations, additional living expenses, and rebooked airline tickets—depending upon the length of the mandatory sequestration.

  

  Contrast this to the tens of thousands of foreign nationals now mustering to cross illegally into the United States this summer.

  They follow the already 2 million who’ve entered the country unlawfully since Joe Biden became president.

  Does any foreign national worry about being tested for COVID-19, much less fear being turned away if he tests positive or lacks proof of vaccination?

  Or do we scrutinize far more carefully U.S. citizens entering their own country legally than we do noncitizens crossing our borders unlawfully?

  For that matter, the government is still determined to fire thousands of federal workers and U.S. military personnel who have refused the new mRNA vaccinations. Most citizens who declined to be vaccinated feared that the injections were dangerous to their health or ineffective in preventing COVID-19 infections, and that they wouldn’t necessarily lead to herd immunity.

  Are 2 million unvaccinated foreigners arriving unaudited from impoverished countries less of a threat during the pandemic than fully audited American citizens employed by the federal government? Why would we fire unvaccinated Americans but welcome equally unvaccinated noncitizens?

  The Biden administration blasted Trump’s southern border wall and canceled all further funding.

  Yet Biden just appropriated $40 billion to Ukraine to ensure it doesn’t lose its border war against Russian aggression.

  That’s a tiny percentage of the federal budget. But the aid is full of symbolic irony nonetheless. The multibillion-dollar appropriation would have more than covered the completion of the entire southern border wall.

  An outside observer might conclude that the U.S. government intends to uphold the universal idea of national sovereignty, internationally recognized borders, and the security of citizens inside its own country—as long as they’re not American citizens.

  There are currently over 550 “sanctuary” jurisdictions established by state and local governments. They aim to prevent federal immigration authorities from deporting illegal aliens, including tens of thousands detained by law enforcement for committing additional crimes.

  The nation hasn’t experienced such blatant nullifications of federal laws since the efforts of pre-Civil War Southern states—or the 1960s Southern governors who defied federal efforts to enforce civil rights legislation.

  Can any citizens now simply vote to declare their hometown or local county immune from federal legislation?

  Can a city or county nullify as it pleases the IRS tax code, endangered species laws, or federal gun registration legislation?

  Or is nullification only permissible in the interest of noncitizens and lawbreakers?

  These asymmetries also transcend noncitizens.

  We have developed entire classes of American elite citizens who are not subject to the enforcement of the law—at least as it’s applied to others who are either less influential or ideologically incorrect.

  Federal prosecutors sought to jail retired Lt. Gen. Michael Flynn for six months for not telling the truth to federal agents.

  They put another Trump subordinate, George Papadopoulos, in jail for two weeks for lying to federal prosecutors.

  Recently, the FBI stormed into an airport to arrest former Trump adviser Peter Navarro for contempt of a congressional subpoena.

  OK, defying federal law has consequences.

  Or does it?

  Former Obama administration Attorney General Eric Holder brazenly defied congressional subpoenas and was found in contempt—a historic first.

  Did the FBI ever arrest Holder—much less as he boarded an airplane?

  James Clapper, former director of national intelligence, confessed that he flat-out lied under oath to a congressional committee.

  So did former CIA chief John Brennan—twice!

  Andrew McCabe repeatedly lied to federal investigators as acting director of the FBI.

  Were any of them arrested or tried in the manner of Flynn, Papadopoulos, or Navarro?

  If not, what then is left of the foundation of U.S. citizenship (universal equal treatment under the law)?

  There are lots of reasons why the looming November midterms will likely see historic levels of pushback against the Biden administration, Democratic candidates, and the entire progressive agenda.

  Take your pick of the many self-induced Biden disasters, such as hyperinflation, unaffordable gasoline, out-of-control crime, and foreign-policy humiliations.

  But one reason voters are furious is rarely expressed. Americans feel that ordinary citizens like them, who follow the rules, are treated more harshly by their own government than are both noncitizens and our own progressive elites.

  And they’re right, and they’re angry, and we will hear from them very soon.

  Tyler Durden
  Wed, 06/15/2022 – 21:40

• Xi Pledges China Will Keep Backing Russian "Sovereignty, Security" In Putin Call
  Xi Pledges China Will Keep Backing Russian “Sovereignty, Security” In Putin Call

  China has once again issued a pledge of verbal support to Moscow amid the ongoing war in Ukraine. A Wednesday phone call between Chinese President Xi Jinping and his Russian counterpart Vladimir Putin included Xi saying China backs Russia on “sovereignty and security”.

  China is “willing to continue to offer mutual support (to Russia) on issues concerning core interests and major concerns such as sovereignty and security,” Chinese state broadcaster CCTV quoted Xi as saying.

  

  Significantly, it was the second such ‘positive’ call between the two leaders since the Ukraine invasion began on Feb.24. Over the past years the two have become obviously closer amid increasing US economic measures intent on isolating both countries.

  The Moscow Times reports the following on the contents of the call:

  According to CCTV, Xi praised the “good momentum of development” in bilateral relations since the start of the year “in the face of global turmoil and changes.”

  Beijing was willing to “intensify strategic coordination between the two countries,” Xi reportedly said.

  China was ready to “strengthen communication and coordination” with Russia in international organizations and “push the international order and global governance towards more just and reasonable development,” he added.

  And noticeably absent in the state media readout was apparently any explicit mention Russia’s war in Ukraine, and the resultant global crises unleashed such as the impact on global wheat and food supply, as well as fuel prices. However, the wording of Xi’s support for Russian “sovereignty and security” has clear enough implications, and certainly sends a message to the West.

  The huge economies of China and India not only have refused to jump on board the West’s retaliatory measures targeting Moscow, but have sought to siphon more cheap Russian oil, which has helped Russia blunt Western sanctions.

  The Xi-Putin call took place on Xi’s 69th birth­day, a sign of both lead­ers’ de­sire to re­in­force a per­sonal friend­ship that has helped take China-Rus­sia re­la­tion­ship to the clos­est point since the early years of the Cold War w/@shashamimi⁩ https://t.co/ZuVS8Mo5Oq

  — Lingling Wei 魏玲灵 (@Lingling_Wei) June 15, 2022

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  Additionally, Beijing has at every turn refused to condemn the Russian invasion of Ukraine, while also denying earlier Biden administration charges that it’s helping thwart anti-Russia sanctions, or the more inflammatory accusation of supplying replenishing weapons and munitions related to Ukraine operations.

  Tyler Durden
  Wed, 06/15/2022 – 21:20

• Lockdowns Lead To Major Decline In China's Refining Output
  Lockdowns Lead To Major Decline In China’s Refining Output

  By Tsvetana Paraskova of Oilprice.com

  Strict lockdowns in Shanghai and the resulting depressed fuel demand led in May to the largest annual decline in Chinese refinery production in at least the past decade, official data cited by Reuters showed on Wednesday.

  

  Last month, Chinese refiners processed around 12.7 million barrels per day (bpd) of crude oil, down by 10.9 percent compared to May 2021, according to data from the Chinese National Bureau of Statistics. Refinery throughput was marginally higher compared to the April processing rate of 12.61 million bpd, but the April refinery output was also low by Chinese standards.   

  

  Weak fuel demand amid strict lockdowns with China’s “zero COVID” policy was behind the largest annual plunge in at least a decade in May.

  

  Refining operations started to recover at the end of last month, when China announced a gradual easing of the lockdowns in Shanghai and Beijing. However, flare-ups since early June have prompted authorities to impose fresh curbs on mobility, in a sign that China’s oil demand recovery will not be smooth.

  A new “explosive” outbreak in a Beijing district is threatening the demand growth recovery again this week.

  Last week, a return to lockdowns in Shanghai weighed on oil prices, suggesting it may be a while yet before the Chinese economy returns to normal. On the flip side, news that China’s oil imports in May were 12 percent higher than a year earlier could potentially lend support to prices, although they may not be indicative of an actual demand increase.

  “The easing of Covid-related restrictions in China should have provided a further boost to sentiment in the market. However, a flare-up of cases in Beijing and Shanghai more recently has seen authorities tighten restrictions once again. China’s covid zero policy remains a downside risk for the market,” ING strategists Warren Patterson and Wenyu Yao wrote on Tuesday.

  Tyler Durden
  Wed, 06/15/2022 – 21:00

• "Khashoggi Way": DC Trolls Saudi Embassy Weeks Before Biden Trip To Riyadh
  “Khashoggi Way”: DC Trolls Saudi Embassy Weeks Before Biden Trip To Riyadh

  Less than a month before President Joe Biden is set to meet with Saudi Crown Prince Mohammad bin Salman – who US intelligence believes ordered the murder of US-based journalist Jamal Khashoggi – Washington DC trolled the prince by renaming the street in front of the Saudi Embassy ‘Jamal Khashoggi Way’ – with a sign stuck right outside the entrance.

  

  While President Joe Biden has signaled he’s ready to ‘move on’ after previously calling Saudi Arabia a “pariah” nation and declassifying a US intelligence assessment that points the finger straight to MbS himself for ordering the October 2018 grisly murder and dismemberment of the WaPo columnist at the Istanbul consulate, it seems many in D.C. who knew the US resident and journalist are not.

  The Saudi ambassador to the US and embassy staff will now be reminded of the state-sponsored assassination on a daily basis as they come and go, even if Biden is pledging to ‘forgive and forget’ – given the average price of gas this week raised above $5, and the White House needs the Saudis to ramp up output.

  A prepared statement from Khashoggi’s fiancée Hatice Cengiz upon the street sign’s unveiling was blistering – calling out Biden’s hypocrisy and demanding answers. It began: “Today, on this happy but very solemn occasion, I have two messages. My first message is to Jamal. Dear Jamal, the ideas and values you lost your life defending have been celebrated worldwide and continue to spread in the region and in the globe.” It continued:

  “My second message is to President Joe Biden. Mr Biden, you’ll soon visit Saudi Arabia as president, where you’ll meet with Jamal’s heartless executioner, dishonoring yourself and Jamal… Mr President, I beseech you not to lose your moral authority or overlook this heinous crime. You must uphold your vow to bring all the perpetrators of this brutal crime to justice.

  “As disappointing as this is, if you have to put oil over principles and expediency over values, can you at least ask, ‘Where is Jamal’s body? Doesn’t he deserve a proper burial?

  

  Cengiz further posed, “And what happened to his killers?” And she said broadly of the kingdom’s abysmal human rights record: “Ask also about the hundreds of other political prisoners rotting in Saudi jails and the victims of brutal repression like Jamal, who have been suffering immensely under an oppressive regime.”

  Meanwhile, a CNN report days ago included the revealing commentary that Biden has “set aside his moral outrage” – apparently in order to go after the “bigger bad guy” of the moment, Vladimir Putin.

  The Jamal Khashoggi Way sign outside the Saudi Embassy in DC.

  This sign now stands as a powerful reminder to those complicit in the brutal murder of Jamal: We’ll keep fighting until all those responsible are held to account.#JusticeForJamal pic.twitter.com/Kma9n6SnAo

  — The Freedom Initiative (@thefreedomi) June 15, 2022

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  “But officials say Biden, who is under immense pressure to crack down on Russia and lower domestic gas prices amid inflation that’s rising at the fastest pace since 1981, has set aside his moral outrage to pursue warmer relations with the Kingdom amid the dramatic global upheaval spurred by the Kremlin’s invasion of Ukraine,” the CNN report said.

  The White House in a Tuesday announcement set the date for Biden’s controversial trip to Riyadh. The itinerary for the July 13-16 official trip includes an initial stop in Israel and the West Bank, before the final leg in Jeddah, Saudi Arabia for a summit of Gulf Cooperation Council (GCC) leaders. That’s when he’ll have a face-to-face with ‘killer’ MbS.

  Tyler Durden
  Wed, 06/15/2022 – 20:40

• BlackRock Sells Out US Interests For 'Personal Favors' In China, Consumer Group Director Says
  BlackRock Sells Out US Interests For ‘Personal Favors’ In China, Consumer Group Director Says

  Authored by Frank Fang and David Zhang via The Epoch Times (emphasis ours),

  BlackRock, the world’s largest investment manager that oversees $10 trillion in client funds, has positioned itself as a socially conscious firm. However, the company is choosing China over the United States as it advances its environmental and social priorities, according to Will Hild, executive director of Washginton-based nonprofit Consumers’ Research.

  

  Hild said BlackRock CEO Larry Fink is “selling out the interests of American consumers and American companies in the United States, in return for personal favors for BlackRock in mainland China,” during a recent interview with EpochTV’s “China Insider” program.

  Fink has been one of the most prominent advocates for ESG investment, which is investing in companies that agree to uphold certain environmental, social, and governance standards.

  However, according to Fink, ESG “is an excuse for Wall Street to push politics into corporate America.” In other words, Wall Street is pushing ESG policies that “could never be achieved at the ballot box,” he added.

  Additionally, BlackRock has also taken up the position of supporting a net-zero emission future. The company’s website tells its clients that “climate transition creates a historic investment opportunity.” In a 2020 letter to CEOs, Fink wrote that “climate risk is investment risk.”

  While BlackRock has pushed U.S. companies such as ExxonMobil to embrace green energy, it has not taken the same approach with Chinese firms, according to Hild.

  “Ironically, Blackrock controls about the same amount of shares, about seven-and-a-half percent, of PetroChina as they do Exxon, but they don’t engage in any of the same behavior when it comes to that company,” he said, such as pushing Chinese companies to adopt net-zero policies.

  Continue reading here…

  Tyler Durden
  Wed, 06/15/2022 – 20:20

• Crypto Markets Quiver Amid Three Arrows Capital Solvency Questions
  Crypto Markets Quiver Amid Three Arrows Capital Solvency Questions

  The crypto bloodbath that has claimed Terra Luna and Celsius may be about to hit one of the largest hedge funds in the space.

  

  Dubai-based Three Arrows Capital (3AC), raised eyebrows on Tuesday when it liquidated at least $40 million of “staked” Ether (stETH), making it the largest seller of the token in the past week, according to The Defiant.

  The firm, which has backed Avalanche, Solana, Terra and a $100M NFT fund launched last August, did not immediately respond to a request for comment. On Twitter, co-founder Su Zhu said that his firm is in touch with counterparties and is committed to resolving the situation.

  We are in the process of communicating with relevant parties and fully committed to working this out

  — Zhu Su 🔺 (@zhusu) June 15, 2022

  Cracks began to form after stETH – which has historically traded with ETH – began to “de-peg” last week, causing the Celsius Network – a “centralized, one-stop-shop for crypto investors and traders” – to freeze customer assets so that it could “honor, over time, its wathdrawal obligations.”

  Meanwhile, Danny Yuan of Hong Kong–based cryptocurrency trading firm 8 Blocks Capital wrote in a post: “We trade in one of 3AC’s trading accounts. This morning they took about [1 million] out of our accounts,” adding “I hope you pay us back asap.”

  We trade in one of 3AC’s trading accounts. This morning they took about ~1m out of our accounts. I hope you pay us back asap. https://t.co/78Nxz72oIu

  — Danny (@Danny8BC) June 15, 2022

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  Trouble began to swirl earlier in the week, after 3AC’s Zhu removed all mention of investments in ETH, Avalanche, Terra, Solana, Near Protocol, Mina, DeFi and NFTs from his Twitter bio, as noted by Cointelegraph.

  3AC in trouble? rumors swirling

  – Kyle and Zhu havent tweeted or liked anything in days
  – Zhu took every coin and # tag out of his bio
  – Zhu deleted his instagram
  – an hour ago they dumped 30k stETH and reduced all AAVE positions

  — moon (@MoonOverlord) June 14, 2022

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  More via The Defiant:

  But hawkeyed observers have noted Celsius was not the largest seller of stETH over the past several days — not by a long shot.

  “People think Celsius is the biggest stETH dumper but its 3AC and it isn’t relatively close,” crypto trader MoonOverlord wrote. “They are dumping on every account and seed round address they have, most looks like its going to payback debts and outstanding borrows they have.”

  people think Celsius is the biggest stETH dumper but its 3AC and it isnt relatively close, they are dumping on every account and seed round address they have, most looks like its going to payback debts and outstanding borrows they have pic.twitter.com/9bZnmTXQzj

  — moon (@MoonOverlord) June 14, 2022

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  Three Arrows’ stETH fire sale began in May, right after the collapse of Terra’s UST stablecoin, according to DeFi analyst DeFiyst. According to The Block, $400M of Three Arrows’ positions have been liquidated already. Crypto analyst Onchain Wizard reports that another $300M is at risk of liquidation on Aave and Compound if the market continues to crater.

  At the time, stETH briefly fell to 95 cents on the dollar relative to Ether “and 3AC pulled 127k stETH in liquidity from Curve ($246m at the time),” they wrote. “They have been in and out of AAVE, wstETH, etc. until the selling began this week.”

  In several transactions Tuesday, the hedge fund withdrew stETH it had deposited in Aave, an interest-bearing DeFi protocol. It then exchanged at least 38,900 stETH – worth about $40M – for ETH. 

  Three Arrows was founded in 2012 by Su Zhu, a onetime securities trader at Deutsche Bank, and Kyle Davies, a former trader at Credit Suisse, according to their LinkedIn Accounts. It’s grown into one of the most formidable funds in crypto, and while it doesn’t disclose its assets under management it is believed to manage billions of dollars worth of assets.

  Zhu has been criticized for apparently hyping stETH as his firm was in the process of dumping it.

  “Most of the steth fair discount analysis ive seen misses that from an onchain functionality perspective, steth is nearly pari passu w eth functionality in defi,” he wrote on Sunday.

  Crypto traders fired back.

  “Literally the moment 3AC capitulates after holding STETH the whole way down – He posts bullish about it,” BullishKid wrote. “How much do you have to hate People around you to do this?”

  *  *  *

  For deeper analysis, check out this thread from @hodlKRYPTONITE:

  3/x – First of all, 3AC collapse is monumental. This is because they borrow from EVERY SINGLE MAJOR lender. Think BlockFi, Genesis, Nexo, Celsius.

  Expect every lender to take on hits from 3AC

  — degentrading (@hodlKRYPTONITE) June 15, 2022

  Continued: 

  The last public number for 3AC’s assets was tagged as 18bn. I strongly suspect their real NAV to be much lower then. There were rumors of them pledging their deribit stake even though they had already disposed of it economically.

  But lets use 18bn. Assume that 9bn of it is mtm VC portfolio. 9bn of it liquid. Assume that all of it was in the safest BTC – (yes i know they have alt L1s which died terribly) – From Nov 21 till now, their liquid pf would have drawn down by close to 70%

  Their liquid pf would be worth 2.7bn at best. If you add the shit coin exposure, realistically their liquid pf would have drawn down to 1bn or less. Which matches the reports on the street that they are unable to meet their margin calls.

  Not being able to meet a margin call is the death knell for any hedge fund. Crypto or tradfi. There are reports of them trying to use Starkware equity as collateral. Well, i guess you can call it StuckWare.

  3AC is one of the biggest borrowers/clients for the lenders globally.

  Their collapse would transfer the economic risk to their lenders. The lenders will bear the pnl difference between how much they are owed versus what they get in liquidating their collateral.

  These lenders are ill-prepared.

  They operate a 10/20bn balance sheet with about 5% of equity buffer. That means that defaults will cause SIGNIFICANT EQUITY erosion.

  Not all lenders are made equal.

  • Celsius is the worst. It has gone under.

  • Nexo, I don’t know.

  • BlockFi is pretty bad as well (after all how do you lose money in a bull mkt?)

  • Genesis is probably the cleanest sheet in the room

  What this means is that lenders will protect themselves by withdrawing credit from the system.

  All the lenders probably have about 50bn (estimated) in loan creation…i expect 30-40bn of credit to be destroyed. i.e loans to be recalled and credit to be shrunk.

  Basic math.

  When credit leaves the system, there is less money overall. Less money for the same amount of coins. coin price down.

  For the more sophisticated ones.

  When credit is removed, the overall balance sheet of every single player shrinks because risk assets are marked down. Market makers are less able to provide liquidity. bid ask spreads widens, for funds – with increased volatility, they need to delever their risk exposures to maintain the same amt of VaR.

  Also, LPs will get scared by UST and now Celsius? Best to prepare for redemptions and sell ahead

  In essence, the collapse of a major fund and a major lender will shrink overall credit in the system and lead to continued deleveraging. So far we have had a orderly liquidation but more people need to delever still.

  Price wise, honestly i have no idea. We probably need the big casino owners to step in. After all if all your clients die, you’ll need to wait for more clients to come in again for your business to work out.

  However, if nobody steps in. We might see prices going below 10k. After all, we have had the perfect storm for a run up (QE etc) now we have the perfect storm for major deleveraging across all financial assets (rate hikes, QT, inflation)

  Finally, if you found this thread useful, please retweet it so that people are properly aware of the big mess we are actually in. This is not the time to bid because of a squiggly line. As much as i like curves.

   

  Also – If you are wondering why BTC and ETH are the first to be sold off, its because in a crisis, you sell what you can. Not what you want. There is no liquidity for shitcoins/ “alts”/ dreams

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  Tyler Durden
  Wed, 06/15/2022 – 20:00

• Viral Video Appears To Show 100s Of Dead Cattle Hit By Kansas Heatwave
  Viral Video Appears To Show 100s Of Dead Cattle Hit By Kansas Heatwave

  Chaos in food supply chains continues to worsen as thousands of cattle across Kansas have mysteriously died. Officially, at least 2,000 cattle died of “extreme heat and humidity” amid triple-digit temperatures, however skeptics aren’t buying it as viral footage shows hundreds of cows laying upside down.

  🇺🇸 On a ranch in the southwest of the state of Kansas alone, more than 3,000 cattle suddenly fell dead last weekend. According to the farmers, there is no plausible explanation for this mass extinction. Cases like this are currently accumulating in the USA. pic.twitter.com/tj6vZ9uNGq

  — Agent J (@YouMayCallMeJay) June 15, 2022

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  The high-end of estimates comes from Progressive Farmer Senior Editor Victoria Myers, who reports preliminary estimates from feedlot or feed yards that show 10,000 fat cattle across the state have died because of scorching hot weather. 

  “What is known is that leading up to these heartbreaking losses, temperatures in the area were over 100 degrees Fahrenheit, there was humidity, and there was little to no wind to help cool the animals. Temperature readings reported for Ulysses began to exceed the 100-degree mark on June 11. By June 13, the high temperature was reported at 104 degrees, with humidity levels ranging from 18% to 35%. Temperature and humidity levels began to break some on June 14. Just a few days prior to the heat setting in, highs had been in the 80s,” Myers said. 

  The Kansas Department of Health and Environment told Reuters they only know of at least 2,000 cattle deaths due to high temperatures and humidity as of Tuesday. 

  One farmer insists “wasn’t the heat.”

  Others had similar commentary:

  I’m in Arizona in the middle of the desert… Never seen cows die like that. Feedlots, dairies like we have here… Never seen cows die of heat. Trust me I live in one of the hottest places in America. Not happening here even with draughts.

  — Crypto-Liz-Taylor (@Liz85139) June 15, 2022

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  Bloomberg weather models show high temps across Kansas have been range-bound between 95-100 degrees Fahrenheit since Saturday and could persist through the 25th of the month. 

  

  What’s odd is that Texas, the state with the highest concentration of cows, is experiencing even hotter weather than Kansas and has thus far yet to experience mass cow deaths.  

  

  Corbitt Wall, a cattle analyst with National Beef Wire, told Progressive Farmer that two non-media sources had described the extent of the Kansas losses. He said there is so much frustration among farmers and pointed out futures markets fell on Monday despite the losses. 

  “I know it’s hard for people in the business to watch that futures market, but it’s not real,” Wall said. “The only time those traders and speculators make money on futures is when the market is volatile, and they are watching these algorithms to tell them where the market is going. For people following the fundamentals, it is frustrating.”

  Kansas State University veterinarian A.J. Tarpoff called the loss a “perfect storm” of too much heat and no opportunity for nighttime cooling that stressed the cattle. 

  “Heat stress doesn’t happen all at one time. Cattle accumulate heat during the day, and then over the nighttime hours, it takes four to six hours for them to dissipate that heat. As long as we have a cooling effect at night, cattle can mostly handle the heat. Where we run into issues is where we have two to four days in a row of minimal nighttime cooling, and we start the day with the heat load we accumulated the day before still there,” Tarpoff said.

  So was it the heat that killed the cows or something else?

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  Tyler Durden
  Wed, 06/15/2022 – 19:40

• With Recession Now Guaranteed, The "One-Term" White House Begins To Panic
  With Recession Now Guaranteed, The “One-Term” White House Begins To Panic

  Listening to Powell speak during the press conference, one would think that when it comes to the economy, it’s blue skies as far as the eye can see:

  • *POWELL: ‘THERE’S NO SIGN’ OF A BROADER SLOWDOWN IN THE ECONOMY

  • *POWELL: REAL GDP GROWTH HAS PICKED UP THIS QUARTER

  • *POWELL: APPEARS US ECONOMY IS IN A STRONG POSITION

  Unfortunately, that’s not exactly “true”…

  

  …as Jeff Gundlach was quick to point out…

  *GUNDLACH ASKS CNBC ‘WHERE IS THE STRONG ECONOMY’ PEOPLE MENTION

  Duh, it’s in:

  c:\Fed\FRBUS\strong_economy.xls

  — zerohedge (@zerohedge) June 15, 2022

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  … and the latest CEO confidence print outright refuted Biden’s optimism:

  “CEO confidence declined sharply in the second quarter of the year for the fourth straight time. The Conference Board’s measure slipped to 42 in the second quarter, the lowest level since the onset of the pandemic, from 57 in the prior period. Historically, a reading of that level has coincided with profits recessions or negative year-over-year changes in earnings. Over the past 40 years, the measure has only been that low in 1980, 1991, 2001, 2008, 2012 and 2020“

  But what is more remarkable is that according to even the latest estimates from Bloomberg Economics, which of course is tied to Bloomberg, a pro-Biden liberal media outlet run by Democrat billionaire Michael Bloomberg, a recession by the start of 2024, barely even on the radar of most economists just a few months ago (if not this site), is now virtually assured at close to a three-in-four probability.

  

  Bloomberg next repeats – with a long delay – something else we said all the way back in December, namely that the Fed outsized rate hike has pushed the economy into a recession…

  What time is Jean-Claude Trichet speaking to explain why the Fed is hiking rates into a recession

  — zerohedge (@zerohedge) December 2, 2021

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  … to wit:

  On Wednesday the Fed delivered its biggest interest-rate hike in almost three decades, as it takes the fight against inflation into overdrive. When central bankers try this hard to slow the economy down, they often end up tipping it into outright reverse.

  America’s ‘Misery Index’ – a broad measure of household wellbeing that combines unemployment rates with inflation rates – has not been this high since President Biden was last in The White House (as VP for Obama in 2011). However, it’s different this time as previously it was labor market strains that spiked the ‘misery’, this time it is the soaring cost of living:

  “People think they probably won’t be unemployed,” says Nobel Prize-winning economist Robert Shiller.

  “Inflation affects everyone. Every time they go to the store they see inflation and it makes them angry.”

  And their reaction, he says, is: “Let’s blame somebody.”

  An ‘adjusted’ Misery Index (which combines Consumer Price Inflation with the US Labor Force Participation Rate for a broader measure of ‘misery’) suggests the ‘average Joe’ has not been in this desperate a situation since Jimmy Carter’s presidency…

  

  And while Bloomberg can trot out the blame game, the reality is that absent a miracle a recession is now unavoidable, which also means that Biden is a one-termer:

  Still, the mood has turned sour at an alarming pace — putting Biden at risk of joining an unenvied club. From Jimmy Carter to George H.W. Bush to Donald Trump, one-term US presidents of the past half-century all had their re-election hopes fatally injured by the lingering effects of a recession.

  It was bad enough that even before the upcoming recession Democrats were looking at a humiliating drubbing in the November midterms…

  

  … but add the economic devastation on deck, and Republicans are looking at full control of Washington again in 2024:

  That prospect is already causing turmoil in the Biden camp, ahead of crucial midterm elections in November when his Democrats must defend thin majorities in Congress — or risk losing what ability they have to get legislation passed, including measures to lift the economy if it slumps.

  The economic collapse on deck also means that Democrats are about to unleash the gaslighting machine like never before, blaming everyone and everything, from Putin, to Yellen, to Exxon, to climate change (and yes, eventually even Biden golden-boy Zelensky) for the pain ordinary households are experiencing… just not themselves of course:

  Voters are telling Democratic pollsters they see economic storms brewing. Key decisions on issues like student loans are paralyzed by inflation fears, according to one person familiar with White House deliberations. The administration is casting around for outside-the box fixes to show they’re fighting for hard-pressed households, from a windfall tax on oil profits to commitments by retailers to cut prices if China tariffs are removed. And its economists are laying out arguments for why the soaring cost of living isn’t Biden’s fault — and the economy is much better than voters seem to think it is.

  Sadly for the liberal propaganda machine, they’ll have to to much better:

  “We ask, ‘If the economy were the weather, how would you describe it?’” asks Celinda Lake, one of Biden’s top pollsters during the 2020 election, who says her focus groups are awash with talk of the rising cost of gas and housing — and how wages aren’t keeping up.

  “Voters have been describing storms and thunderstorms.” she answers.

  And then there is of course the bear market, which the White House is about to learn that mixed with a recession polls even worse than hyperinflation. In fact, as we noted earlier, it has been a hell of a week for Biden:

  The week so far:

  Monday: Bear market
  Tuesday: Mass layoffs
  Wednesday: Fed hiking 75bps into a recession
  …

  — zerohedge (@zerohedge) June 15, 2022

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  … and it’s only Wednesday.

  As for Republicans, it’s their elections to lose. As Bloomberg notes, the Republican line is that Biden and his team share the blame for soaring prices – which they do – because they pumped another $1.9 trillion of stimulus into the economy in March 2021 when it was already recovering.

  “They put money into everybody’s pockets but they didn’t do anything in terms of supply-chain issues,” says David Winston, a GOP pollster and strategist who helps craft economic messaging for Republican leadership in Congress.

  “When you increase demand but you don’t figure out how to increase supply at the same time, you get inflation.”

  Which is not to say that the White House won’t go down swinging: “the administration’s economists have modeled extreme scenarios — from a new coronavirus variant to an even bigger spike in oil prices — so that they’re prepared to act fast in case of emergency, a senior White House official said.“

  In short, get ready for another surprise, “emergency” shock meant to distract from the shitshow that is Biden’s economy and Powell’s galloping inflation and bear market. Only, after the fiasco that was the monkeypox false start, it’s difficult to visualize what – short of a staged war over Taiwan – the Biden propaganda machine will come up with. One thing  is certain – it will try, and if not this year, brace for a very hot summer, full of Soros-funded protests, in both 2023 and 2024 as Democrats go all in on avoiding another humiliating sweep in 2024, with Trump lurking in the shadows.

  Tyler Durden
  Wed, 06/15/2022 – 19:27

• 'Big Oil' Responds To Biden's Threats: Here's 10 Things You Can Do To Ease Gas Prices
  ‘Big Oil’ Responds To Biden’s Threats: Here’s 10 Things You Can Do To Ease Gas Prices

  Following President Biden’s letter to many ‘Big Oil’ executives, threatening them with forced production quotas, windfall taxes, and/or price-caps (because all those things have proved so successful in past crises… not), Exxon Mobil issued a reasoned response to The White House accusations and scapegoating: (emphasis ours)

  We have been in regular contact with the administration to update the President and his staff on how ExxonMobil has been investing more than any other company to develop U.S. oil and gas supplies. This includes investments in the U.S. of more than $50 billion over the past five years, resulting in an almost 50% increase in our U.S. production of oil during this period.

  Globally, we’ve invested double what we’ve earned over the past five years — $118 billion on new oil and gas supplies compared to net income of $55 billion. This is a reflection of the company’s long-term growth strategy, and our commitment to continuously invest to meet society’s demand for our products.

  Specific to refining capacity in the U.S., we’ve been investing through the downturn to increase refining capacity to process U.S. light crude by about 250,000 barrels per day – the equivalent of adding a new medium-sized refinery. We kept investing even during the pandemic, when we lost more than $20 billion and had to borrow more than $30 billion to maintain investment to increase capacity to be ready for post-pandemic demand.

  In the short term, the U.S. government could enact measures often used in emergencies following hurricanes or other supply disruptions — such as waivers of Jones Act provisions and some fuel specifications to increase supplies.

  Longer term, government can promote investment through clear and consistent policy that supports U.S. resource development, such as regular and predictable lease sales, as well as streamlined regulatory approval and support for infrastructure such as pipelines.

  Additionally, buidling on Exxon’s suggestions, the American Petroleum Institute – which represents ‘Big Oil’ – sent a letter to the president offering some advice.

  

  The letter begins by acknowledging President Biden’s efforts to address Russia’s actions and then focuses on how we got here:

  “Unfortunately, Russia’s actions and the instability it created has contributed to an already forming global energy crisis. Several factors have led to a significant and sustained supply and demand imbalance in global oil markets. Demand for energy, specifically crude oil, has surged as global economies have rebounded from the early part of the COVID-19 pandemic. In part, supplies have not kept pace due to global underinvestment in recent years driven by geopolitical and market forces, public policies, and investor sentiment.

  This combination of factors and events leaves us in the situation we face today. Namely, the most consequential energy crisis since the 1970s.”

  Then, The API lays out ten steps that President Biden can take to ease the bottlenecks and lower gas prices for the ‘average joe’…

  1. Lift Development Restrictions on Federal Lands and Waters

  The Department of the Interior (DOI) should swiftly issue a 5-year program for the Outer Continental Shelf and hold mandated quarterly onshore lease sales with equitable terms. DOI should reinstate canceled sales and valid leases on federal lands and waters.

  2. Designate Critical Energy Infrastructure Projects

  Congress should authorize critical energy infrastructure projects to support the production, processing, and delivery of energy. These projects would be of such concern to the national interest that they would be entitled to undergo a streamlined review and permitting process not to exceed one year.

  3. Fix the NEPA Permitting Process

  Your administration should revise the National Environmental Policy Act (NEPA) process by establishing agency uniformity in reviews, limiting reviews to two years, and reducing bureaucratic burdens placed on project proponents in terms of size and scope of application submissions.

  4. Accelerate LNG Exports and Approve Pending LNG Applications

  Congress should amend the Natural Gas Act to streamline the Department of Energy (DOE) to a single approval process for all U.S. liquefied natural gas (LNG) projects. DOE should approve pending LNG applications to enable the U.S. to deliver reliable energy to our allies abroad.

  5. Unlock Investment and Access to Capital

  The Securities and Exchange Commission should reconsider its overly burdensome and ineffective climate disclosure proposal and your administration should ensure open capital markets where access is based upon individual company merit free from artificial constraints based on government-preferred investment allocations.

  6. Dismantle Supply Chain Bottlenecks

  You should rescind steel tariffs that remain on imports from U.S. allies as steel is a critical component of energy production, transportation, and refining. Your administration should accelerate efforts to relieve port congestion so that equipment necessary for energy development can be delivered and installed.

  7. Advance Lower Carbon Energy Tax Provisions

  Congress should expand and extend Section 45Q tax credits for carbon capture, utilization, and storage development and create a new tax credit for hydrogen produced from all sources.

  8. Protect Competition in the Use of Refining Technologies

  Your administration should ensure that future federal agency rulemakings continue to allow U.S. refineries to use the existing critical process technologies to produce the fuels needed for global energy markets.

  9. End Permitting Obstruction on Natural Gas Projects

  The Federal Energy Regulatory Commission should cease efforts to overstep its permitting authority under the Natural Gas Act and should adhere to traditional considerations of public needs as well as focus on direct impacts arising from the construction and operation of natural gas projects.

  10. Advance the Energy Workforce of the Future

  Congress and your administration should support the training and education of a diverse workforce through increased funding of work-based learning and advancement of STEM programs to nurture the skills necessary to construct and operate oil, natural gas, and other energy infrastructure.

  The question is – will the Biden administration do any of them?

  *  *  *

  Read the full letter below:

  Tyler Durden
  Wed, 06/15/2022 – 19:20

• Goldman Trading Desk: After This FOMC Squeeze, Market Wants To Take Another Leg Lower
  Goldman Trading Desk: After This FOMC Squeeze, Market Wants To Take Another Leg Lower

  In our FOMC “Gameplan” note published earlier today on “How To Trade The Fed’s Rate Hike”, we said that the initial move would be a rally higher, and sure enough, after a headfake down that sent spoos to session lows, we had a torrid 120 point surge that pushed e-minis to the verge of breaking out of the bear market before risk eased back a bit. However, the question is what happens next now that the initial bounce has faded. Well, as a reminder, a few hours we said this “kneejerk move higher (especially if we get an outsized hike, hinting the Fed is hoping to catch up to the curve), then a gradual drift lower.” It appears that Goldman’s sales & trading desk (which unlike the bank’s research team, is actually quite good as it consistently prints money day after day), agrees.

  

  We excerpt from the market note published by Goldman’s John Flood, titled appropriately enough “75bps for first time since 1994”, in which he predicts that now that the initial bounce is done, the pain is next:

  Our desk was a 6 on 1 -10 scale in terms of overall activity level today. HF covers of macro products into the fed and then highest velocity covering in lower quality from 2:30 to 3:30pm which eventually lost some steam.

  Lowest quality pockets of the market again were outperformers: 12M Losers (GSCBLMOM) +524bps, Non Profitable Tech (GSXUNPTC) +470bps, Expensive Software (GSCBSF8X) +449bps and Most Short (GSCBMSAL) +356bps. L/O were paralyzed for most of session today.

  My gut is after this FOMC squeeze mkt wants to take another leg lower with CTAs as sellers, corps in blackout, retail sucking wind in midst of crypto unwind, and L/Os remaining astonishingly patient with piles of cash they are currently sitting on. Daan Struyven’s (GIR) bottom line on fed today is unnerving: This shows the number one goal is the inflation target – no matter what other damage to get there.

  Something worth monitoring that could mute my move lower thesis into month end: GS US PENSION REBAL UPDATE — sizable pension demand heading into quarter end. As of yday’s close, our GS model estimates $30bn of US equities to BUY for month-end and quarter-end (94th %ile 3yr lookback). $30bn to BUY ranks in the 94th %ile on a net basis (-$70bn to +$150bn scale) over the past 3yrs and in the 96th %ile going back to Jan 2000 (meaningfully large).

  If Goldman is right, enjoy the ramp which is expected to quietly fade, at least until we get the next major economic print which should be a doozy and confirm that the US is headed smack dead on for a recession. Incidentally for those asking, the last time the Fed hiked 75bps was in Nov 1994. It was cutting rates 7 months later…

  

  Tyler Durden
  Wed, 06/15/2022 – 19:00

• Elon Musk 'Leaning Towards DeSantis' For President In 2024, Predicts 'Massive Red Wave' In Midterms
  Elon Musk ‘Leaning Towards DeSantis’ For President In 2024, Predicts ‘Massive Red Wave’ In Midterms

  Tesla (and soon to be Twitter) CEO Elon Musk says he’s leaning towards supporting Florida Governor Ron DeSantis for president in 2024 – as former President Trump (who owns Twitter competitor Truth Social) didn’t make the cut.

  

  In a Tuesday evening Twitter thread in which Musk admitted to voting for Texas Congresswoman Mayra Flores, the “first time I ever voted Republican,” adding “Massive red wave in 2022.”

  When asked which Republican he would support for President, he initially replied “tbd” (to be determined), only to admit when pressed that he’s leaning towards “DeSantis.”

  I assume republican for president 2?

  — Tesla Owners Silicon Valley (@teslaownersSV) June 15, 2022

  

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  DeSantis

  — Elon Musk (@elonmusk) June 15, 2022

  Musk then said that he’s thinking of creating a “Super Moderate Super PAC” that supports “candidates with centrist views from all parties.”

  I’m thinking of creating a “Super Moderate Super PAC” that supports candidates with centrist views from all parties

  — Elon Musk (@elonmusk) June 15, 2022

  https://platform.twitter.com/widgets.jsAs Bloomberg notes, DeSantis has positioned himself as a staunch conservative, and ‘heir apparent to Donald Trump.’

  

  Trump, meanwhile, gave Musk the cold shoulder – announcing that he wouldn’t return to Twitter even if allowed back once Musk takes the helm. Instead, Trump will remain on Truth social – telling Fox News in April: “I am not going on Twitter, I am going to stay on Truth,” adding “I hope Elon buys Twitter because he’ll make improvements to it and he is a good man, but I am going to be staying on Truth. The bottom line is, no, I am not going back to Twitter.”

  Tyler Durden
  Wed, 06/15/2022 – 18:39

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