Today’s News 6th May 2024

• Biden's New Carbon Capture Mandates Will Cause Blackouts, Increases Prices
  Biden’s New Carbon Capture Mandates Will Cause Blackouts, Increases Prices

  By Mish Shedlock of MishTalk

  The lie of the day is from the EPA: Carbon capture will pay for itself (thanks to IRA subsidies). No, it won’t even with subsidies. Expect blackouts and a higher price for electricity.

  

  Suite of Standards to Raise Costs, Reduce Output

  Let’s take a dive into the EPA news release Biden-Harris Administration Finalizes Suite of Standards to Reduce Pollution from Fossil Fuel-Fired Power Plants

  “Today, EPA is proud to make good on the Biden-Harris Administration’s vision to tackle climate change and to protect all communities from pollution in our air, water, and in our neighborhoods,” said EPA Administrator Michael S. Regan. “By developing these standards in a clear, transparent, inclusive manner, EPA is cutting pollution while ensuring that power companies can make smart investments and continue to deliver reliable electricity for all Americans.”

  A final rule for existing coal-fired and new natural gas-fired power plants that would ensure that all coal-fired plants that plan to run in the long-term and all new baseload gas-fired plants control 90 percent of their carbon pollution.

  The final emission standards and guidelines will achieve substantial reductions in carbon pollution at reasonable cost. The best system of emission reduction for the longest-running existing coal units and most heavily utilized new gas turbines is based on carbon capture and sequestration/storage (CCS) – an available and cost-reasonable emission control technology that can be applied directly to power plants and can reduce 90 percent of carbon dioxide emissions from the plants.

  Lower costs and continued improvements in CCS technology, alongside tax incentives from President Biden’s Inflation Reduction Act that allow companies to largely offset the cost of CCS, represent recent developments in emissions controls that informed EPA’s determination of what is technically feasible and cost-reasonable. The Bipartisan Infrastructure Law also includes billions of dollars to advance and deploy CCS technology and infrastructure. EPA projects that the sector can comply with the standards with negligible impact on electricity prices, thanks to cost declines in CCS and other emissions-reducing technologies. EPA analysis also finds that power companies can comply with the standards while meeting grid reliability, even when considering increased load growth.

  Final EPA Rule

  The EPA’s Final Rule is only 1,020 pages long. There were 953 references to carbon capture and sequestration/storage (CCS).

  I went through some of those 953 references and found these tidbits.

  CCS is an adequately demonstrated technology that achieves significant emissions reduction and is cost-reasonable, taking into account the declining costs of the technology and a substantial tax credit available to sources.

  The first component of the BSER [Best System of Emission Reduction] for base load combustion turbines is highly efficient generation (based on the emission rates that the best performing units are achieving) and the second component for base load combustion turbines is utilization of CCS with 90 percent capture.

  One of the key GHG [Greenhouse Gasses] reduction technologies upon which the BSER determinations are founded in these final rules is CCS—a technology that can capture and permanently store CO2 from fossil fuel-fired EGUs.

  I confess. I did not read all 1020 pages and don’t intend to. I have seen enough by reading through a dozen or so of the 953 references to CCS.

  Returning to the Biden-Harris document I note references to “reasonable cost” and “largely offset the cost of CCS.” Thus CCS is admittedly not cost effective even with subsidies.

  IISD Sustainable Development

  For a rebuttal to the above Biden claims, please consider the International Institution for Sustainable Development article Why Carbon Capture and Storage Is Not a Net-Zero Solution for Canada’s Oil and Gas Sector

  The poor track record of CCS in Canada is part of a broader trend. According to the Global CCS Institute (2022), the global growth of carbon captured by commercially operating CCS facilities has been much slower than anticipated. As of September 2022, only 30 commercial CCS projects are operating across all sectors around the world, capturing 42.5 Mtpa. This falls far short of the IEA’s (2009) previous target of 300 Mtpa by 2020. Most proposed projects have been withdrawn: of the 149 CCS projects anticipated to be storing carbon by 2020, over 100 were cancelled or placed on indefinite hold (Abdulla et al., 2020; Wang et al., 2021). In the United States, despite significant industry and government investment in the technology, more than 80% of proposed CCS projects have failed to become operational due to high costs, low technological readiness, the lack of a credible financial return, and dependence on government incentives that are withdrawn. Of those projects that are operating globally, 73% of the carbon captured is used for EOR.

  Put simply, proponents of CCS have repeatedly over-promised on the technology’s ability to reduce emissions, and CCS projects have under-delivered.

  CCS is both energy and capital intensive. The greatest amount of energy is required for the capture and compression of carbon, with additional amounts needed for transportation and storage. Capture and compression alone require 330–420 kWh per tonne of CO2 captured. CCS projects increase the energy demand of the facility they capture carbon from by 15%–25% on average, which stands to increase emissions given that the energy used to capture CO2 is often natural gas-powered electricity. In general, the technology is highly energy inefficient and generates its own emissions.

  The above doc largely pertains to carbon capture in Canada’s Oil and Gas Sector, not electricity production, bit it is instructive on the difficulty of and inefficacy of carbon capture.

  The lead CCS image is from that post.

  Biden EPA’s Plan to Ration Electricity

  The Wall Street Journal calls the CCS mandate Biden EPA’s Plan to Ration Electricity

  Section 111 of the Clean Air Act says the EPA can regulate pollutants from stationary sources through the “best system of emission reduction” that is “adequately demonstrated.” Carbon capture is neither the best nor adequately demonstrated. As of last year, only one commercial-scale coal plant in the world used carbon capture, and no gas-fired plants did.

  EPA says Inflation Reduction Act tax credits and funding in the 2021 infrastructure bill will “incentivize and facilitate the deployment” of carbon capture. But subsidies would have to be two to three times larger to make the technology cost-effective at a coal plant. Carbon capture reduces a plant’s efficiency, which also raises costs.

  Because carbon capture uses 20% to 25% of the electricity generated by a power plant, less will be available to the grid. That means more generators will be needed to provide the same amount of power. But new gas-fired plants won’t be built because the technology will make them uneconomic. Talk about a catch-22.

  Another problem: CO2 must be stored underground in certain geologic formations, largely in the upper Midwest and Gulf Coast. Permitting new wells for CO2 injections can take six years. Pipelines to transport CO2 can take even longer. Green groups oppose pipelines for CO2 as they do for oil and natural gas.

  All of this will hit while demand for power is surging amid new manufacturing needs and an artificial intelligence boom. Texas’s grid operator this week raised its forecast for demand growth for 2030 by 40,000 megawatts compared to last year’s forecast. That’s about seven times the power that New York City uses at any given time.

  Texas power demand will nearly double over the next six years owing to data centers, manufacturing plants, crypto mining and the electrification of oil and gas equipment. When temperatures in Texas recently climbed into the 80s, the grid operator told power plants not to shut down for maintenance. Americans around the country are increasingly being told to raise their thermostats during the summer and avoid running appliances to prevent blackouts.

  Even some Democrats are noticing the pinch on their voters’ pocketbooks. Reps. Marcy Kaptur, Henry Cuellar, Mary Sattler Peltola, Vicente Gonzalez and Jared Golden last weekend urged President Biden to defer finalizing EPA’s power-plant rules because they could “inadvertently exacerbate existing problems related to the unaffordability of electricity” and cause “increased risks to electric reliability.”

  Mr. Biden’s new rules will surely draw a legal challenge. But as litigation plays out, the tremendous uncertainty will delay investment in much-needed new gas plants. Americans didn’t face energy rationing in Mr. Biden’s first term, but they might in a second.

  The Inflation Reduction Act Keeps Biting in Predictable Ways

  Biden plans to reduce inflation by raising costs, producing less electricity when more is needed, force people into EVs without a capable grid, pipeline captured carbon when the pipelines don’t exist and allegedly increase reliability.

  It’s so stupid even some Democrats are concerned. Well not to worry, this can all be done at a “reasonable cost” with costs “largely offset” thanks to the IRA.

  Expect blackouts and a much higher price for electricity as a key component of “reasonable cost”.

  Tyler Durden
  Mon, 05/06/2024 – 02:00

• Yen's First Intervention Rally Owed Very Little to Short Squeeze
  Yen’s First Intervention Rally Owed Very Little to Short Squeeze

  By Garfield Reynolds, Bloomberg Markets Live reporter and strategist

  The first of Japan’s apparent twin interventions last week may have capped USD/JPY for some time to keep the pair under 160. But that had very little to do with flushing out yen short positioning at least with the initial move. Large speculators as covered by CFTC data through last Tuesday were still very strongly positioned for yen declines, highlighting both why Japan was so willing to apparently step in again on Thursday morning Tokyo time, and why it may need to do so several more times in the coming weeks.

  The latest CFTC reading shows yen bears trimmed positions for the first time in seven weeks, but they only cut back by 11,531 contracts — less than the shorts added in the prior week to April 23!

  So the newest, weakest hands look to be the only ones who got forced out when Japan sold an estimated $35b to buy yen. That did at least stop the CFTC shorts exceeding the record 188,000 contracts touched in 2007, though it left them at extreme levels.

  

  Perhaps the second time Japan stepped in — after the Federal Reserve’s Wednesday decision — caused more of a positioning shift, coming as it did in the US session rather than during Tokyo hours. But we won’t find out how much of an impact until this coming Friday’s release from the CFTC.

   

  Tyler Durden
  Mon, 05/06/2024 – 00:36

• Marine Vet With PTSD Given More Than 5 Years In Prison, Fined $200,000 Over Jan. 6
  Marine Vet With PTSD Given More Than 5 Years In Prison, Fined $200,000 Over Jan. 6

  Authored by Joseph M. Hanneman via The Epoch Times (emphasis ours),

  Ryan Taylor Nichols, a Marine Corps veteran and disaster-rescue specialist who argued that post-traumatic stress drove his behavior at the U.S. Capitol on Jan. 6, was sentenced on May 2 to more than five years in prison and fined $200,000 for assaulting police and obstruction of an official proceeding.

  

  Mr. Nichols, 33, of Longview, Texas, was ordered by U.S. District Judge Royce Lamberth to serve 63 months behind bars and fined $200,000—the lion’s share of the $237,708 raised on a GiveSendGo page set up for his legal and household expenses.

  It was the largest fine issued in a Jan. 6 criminal case.

  Judge Lamberth also ordered Mr. Nichols to serve 36 months of supervised release and pay $2,000 in restitution.

  Prosecutors sought an upward departure from federal sentencing guidelines in asking for an 83-month prison sentence. The Department of Justice stressed Mr. Nichols’s use of pepper spray on police and his incendiary rhetoric before, during, and after Jan. 6.

  Mr. Nichols argued for time served after 28 months in custody, citing his severe PTSD and “horrific prison conditions” at the District of Columbia jail as major mitigating factors.

  “Ryan Nichols is a good guy who made a bad decision on January 6. He’s paid his debt in the most cruel and unusual way possible,” defense attorney Joseph D. McBride told The Epoch Times. “The fact that he’s got to go back to jail for any period of time sickens me to my stomach.”

  Mr. McBride said despite not objecting to the sentencing calculation made by the U.S. Probation and Pretrial Services System, the DOJ complained to Judge Lamberth on May 2 that an error needed correcting that would bump up Mr. Nichols’s sentencing range.

  The judge allowed the last-minute change, Mr. McBride said.

  “I’m disappointed. I respect his [Judge Lamberth’s] service, but I don’t respect his decision today.”

  ‘Expletive-Laden Tirade’

  Federal prosecutors stressed Mr. Nichols’s use of potent pepper spray on the police line near the Lower West Terrace tunnel and his participation in a heave-ho maneuver against police as evidence of his propensity for violence.

  Mr. Nichols’s speech and his belief that the 2020 presidential election was stolen from President Donald J. Trump drew extensive commentary and attention from prosecutors in their 36-page sentencing memorandum.

  On his walk from the Ellipse to the Capitol after President Trump’s speech on Jan. 6, Mr. Nichols let loose with an “eighteen-minute, expletive-laden, threatening tirade,” prosecutors wrote.

  

  “I’m hearing reports that [Vice President Mike] Pence caved. I’m telling you if Pence caved, we’re gonna drag [expletive] through the streets,“ Mr. Nichols said on a social media broadcast. ”You [expletive] politicians are going to get [expletive] drug through the streets. Because we’re not going to have our [expletive] stolen. We’re not going to have our election or our country stolen.”

  After hearing that protesters had breached the Capitol, Mr. Nichols urged them to “get up in there.”

  “Cut their heads off,“ he said. ”Hey, Republican protestors are trying to enter the House right now at the Capitol is the word that I’m getting. So, if that’s true, then get up in there. If you voted for treason, we’re going to drag your [expletive] through the streets.”

  Mr. Nichols also chanted, “Lock and load, lock and load, lock and load,” the DOJ memo said.

  Late on Jan. 6, Mr. Nichols took to social media again to proclaim himself leader of a revolution, the DOJ said.

  “So, yes, I’m calling for violence! And I will be violent!“ Mr. Nichols said. ”Because I’ve been peaceful and my voice hasn’t been heard! I’ve been peaceful and my vote doesn’t count! I’ve been peaceful and the courts won’t hear me. So you’re [expletive] right, I’m going to be violent now!”

  PTSD Drove Behavior

  Mr. McBride cited Mr. Nichols’s PTSD that grew out of his Marine Corps service and his work rescuing stranded residents and pets after countless hurricanes to cast his Jan. 6 behavior in context.

  Because Mr. Nichols had stopped taking his psychiatric medications during the summer of 2020, he believed the country was at war when he traveled to Washington D.C. on Jan. 6, Mr. McBride wrote in his 28-page sentencing memo.

  Jan. 6 was a “PTSD-related aberration in Ryan’s law-abiding life,” Mr. McBride wrote.

  “Ryan’s earnest desire to legally participate in political protest was hijacked by his PTSD, which told him that America was under attack,” Mr. McBride said. “By the time Ryan walked over to the Capitol from the Ellipse on January 6, his PTSD had reached category-5 five hurricane status. His pupils were dilated. His heart was pounding.”

  The man who recorded the video late on Jan. 6 “was so detached from reality that neither Ryan nor anyone from his family recognized him,” Mr. McBride wrote. “That is a man who lost impulse control because PTSD hit the override button in his brain.”

  Mr. Nichols founded a nonprofit organization called Rescue the Universe that has saved the lives of more than 150 people in the aftermath of hurricanes, tropical storms, and tornadoes.

  During Hurricane Michael in 2018, Mr. Nichols drove from Texas to Florida to assist the Coast Guard with rescues. He saved a woman who was eight months pregnant after she was trapped under the rubble of her home, Mr. McBride wrote.

  

  “On another occasion, he was called upon to evacuate several nursing homes. The staff evacuated and left the elderly residents to die,” Mr. McBride wrote. “Ryan tried to save as many lives as possible but could not save everyone.”

  Although Mr. Nichols informed the U.S. Marshals and jail staff that he suffered from PTSD when he was arrested in January 2021, solitary confinement was used against him, and he suffered from other “horrible” conditions during pretrial detainment, Mr. McBride said.

  ‘Driven to Suicide Watch’

  In one instance, “he was thrown into solitary confinement for three weeks,” Mr. McBride wrote. “His drinking water was regularly cut off for 20-hour periods. He was harassed and prodded to the point where he was driven to suicide watch.

  “Suicide watch involved Ryan being stripped naked and forced to wear a plastic Tyvek suit in a brightly lit room where the guards continued to harm and encourage him to kill himself,” Mr. McBride said.

  The mistreatment of Mr. Nichols was the subject of an Aug. 22, 2022, habeas corpus petition and numerous follow-up petitions seeking his release from custody. On Nov. 22, 2022, U.S. District Judge Thomas Hogan ordered Mr. Nichols released to the custody of his wife, Bonnie Nichols.

  

  Mr. Nichols spent 350 days on home detention before being ordered back behind bars in November 2023 when he pleaded guilty to two criminal counts under a deal with the DOJ.

  In his sentencing memo, Mr. McBride argued that pretrial services erred in its calculation of possible prison time under federal guidelines. The correct range should have been 24–30 months, he said. Given Mr. Nichols’s 28 months in pretrial detention, he would be eligible for a sentence of time served.

  Mr. McBride filed 57 character letters with Mr. Nichols’s sentencing memo and video statements from his client’s wife, father, and sons.

  “I don’t think my Dad is a criminal and he’s been locked away for a long time,“ Blake Nichols, 8, said in one video. ”I’ve known him for seven years and I think he’s a hero and he did a lot of good things in life and all of that added up to one bad thing.

  “I was just wondering if you could make him come home,” the boy said. “It’s been very bad for him not to be here and I’ve been thinking about him all night.”

  Mr. Nichols has great remorse over Jan. 6, Mr. McBride wrote, and he has suffered greatly in prison for it.

  “Ryan is mortified by the videos and images depicting his outlandish January 6 behavior,” Mr. McBride wrote. “He apologizes sincerely for his words and actions on January 6, 2021, which harmed his family, country, and himself.

  “January 6 is a severe and unfortunate aberration in his law-abiding life.”

  Tyler Durden
  Sun, 05/05/2024 – 23:20

• Texas AG Threatens "Every Possible Response" After Defiant Austin Allows "Gender Affirming" Care For Minors
  Texas AG Threatens “Every Possible Response” After Defiant Austin Allows “Gender Affirming” Care For Minors

  Texas Attorney General Ken Paxton has responded to a defiant decision by the Austin City Council (ACC), which voted on Thursday to ignore a state law which prohibits “gender transitioning or gender reassignment procedure or treatment” for minors under the age of 18.

  

  In a 10-1 vote, the ACC passed the resolution which directs city resources away from SB 14.

  Paxton Responds

  “On May 2, 2024, the Austin City Council passed a resolution that purportedly directs the city manager and city employees not to comply with Texas’s prohibition of puberty blockers, cross-sex hormones, and invasive surgeries for children who believe their gender is different than their biological sex,” Paxton said in response.

  “Riddled with problems, the resolution starts with the falsehood that such prohibited treatments have ‘proven to be evidence-based, medically necessary, and lifesaving.’ In addition to a growing body of medical research rejecting such claims, Texas concluded that the proposed treatments for minors are dangerous, and banned the practices by passing SB 14,” he said.

  Paxton says his office stands ready to ensure Austin follows state law.

  “If the City of Austin refuses to follow the law and protect children, my office will consider every possible response to ensure compliance,” he said. “Texas municipalities do not have the authority to pick and choose which state laws they will or will not abide by. The people of Texas have spoken, and the Austin City Council must listen.”

  As the Epoch Times notes further, the resolution was introduced by Council Member Chito Vela, who represents District 4. It was co-sponsored by four other council members—Ryan Alter, Zo Qadri, José Velásquez, and Vanessa Fuentes.

  The one no vote was Council Member Mackenzie Kelly of District 6.

  “Except to the extent required by law, it is the policy of the City that no City personnel, funds, or resources shall be used to investigate, criminally prosecute, or impose administrative penalties upon: (1) a transgender or nonbinary individual for seeking healthcare, or (2) an individual or organization for providing or assisting with the provision of healthcare to a transgender or nonbinary individual,” the resolution states.

  It also directs Austin police to make enforcement of SB 14 their lowest priority.

  According to Mr. Paxton, the resolution is nothing more than an “empty political statement” citing that each clause in the resolution directs the city manager to defy SB 14 with the qualifying statement “except to the extent required by law.” He said the ACC would order the city manager and employees to follow the law while pretending to say the opposite.

  “The vote by the Austin City Council today to support sex change operations for kids is infuriating but comes at no surprise. Repeatedly, Austin City Council has cared more about virtue signaling than the health and safety of its citizens,” Mary Elizabeth Castle, director of Government Relations for Texas Values, told The Epoch Times via email.

  

  Ms. Castle said: “the resolution by its nature does not address the specific enforcement of law and instead directs entities like the local police department and the district attorney, who were not given enforcement power by SB 14, to ignore the law. The resolution is mostly a shell game to make it seem like Austin City Council will not comply with the law.”

  In previous years, Ms. Castle said the ACC’s measures with pro-life laws and defunding the police have directed law enforcement to “either ignore complaints regarding laws on social issues they do not agree with or push them to the bottom of the stack.

  “Today’s action signals to the larger Austin community that sex change operations for kids are no big deal, when in fact transitioning a child can be deadly and dangerous,” said Ms. Castle.

  A new long-term study out of the Netherlands found many adolescents who have doubts about their identity and gender identity grow out of it. The study also found it is normal to have doubts about one’s identity and it is actually relatively common.

  In 2023, Mr. Abbott signed SB 14 into law. The law prohibits any physician or health care provider from “transitioning a child’s biological sex as determined by the sex organs, chromosomes, and endogenous profiles of the child or affirming the child ’s perception of the child ’s sex if that perception is inconsistent with the child ’s biological sex.”

  The law prohibits doctors from performing numerous procedures on minors as part of gender transitioning including castration, hysterectomy, metoidioplasty, orchiectomy, among others.

  Prescription drugs associated with transitioning such as puberty blockers and supraphysiologic doses of testosterone to females or estrogen to males were also prohibited in Texas.

  Tyler Durden
  Sun, 05/05/2024 – 22:45

• Appeals Court Hammers Prosecution About FBI Conduct In Whitmer Kidnap Plot
  Appeals Court Hammers Prosecution About FBI Conduct In Whitmer Kidnap Plot

  Authored by Ken Silva via Headline USA,

  The much-anticipated appeal hearing was held Thursday for Barry Croft and Adam Fox, the alleged “ringleaders” of the 2020 militia conspiracy to kidnap Michigan Gov. Gretchen Whitmer.

  

  Croft and Fox were convicted of plotting to kidnap Whitmer after their second trial in late 2022. At their first trial earlier that year, a jury acquitted two other men while failing to reach a verdict for Croft and Fox.

  The two men appealed their convictions on multiple grounds. Thursday’s hearing focused largely on the conduct of FBI informants and their handling agents.

  Oral arguments in appeal of conviction of Adam Fox and Barry Croft–two men entrapped by FBI in Whitmer fednapping hoax–about to begin.

  Basis of appeal in Fox case. Will cover live: pic.twitter.com/8DbxqFQ0fw

  — Julie Kelly 🇺🇸 (@julie_kelly2) May 2, 2024

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

  Croft’s attorney, Timothy Sweeney, argued that his client should get a retrial because he wasn’t allowed to introduce numerous text messages that showed improper conduct by the FBI.

  Those text messages showed how FBI informants were pressuring Fox and Croft to formulate a plan against Whitmer. A list of the texts can be found in this document.

  Representing the government, Assistant U.S. Attorney Nils Kessler argued that the FBI text messages were irrelevant because Fox and Croft were already predisposed to committing an act of terrorism.

  “All the [FBI] statements identified by defense go to inducement. If jury found they were predisposed [to kidnapping Whitmer], none of that matters,” Kessler said. “This court has held that entrapment can only happen if the government plants an idea in an innocent persons’ head.”

  The appeals justices expressed skepticism about Kessler’s argument. One justice disagreed with the prosecutor’s reading of the law.

  “They’re saying the jury didn’t see all the pressure, all the government informants pounding on them. Surely that’s relevant?” the justice asked Kessler, to which he responded: “Theoretically, yes, but they don’t identify any statements where an informant actually put that kind of pressure to go kidnap the governor.”

  The justices then identified several statements where informants pressured the defendants to move forward with a plot against Whitmer. For example, FBI informant Steve Robeson said in August 2020: “If we don’t talk about actually doing what the fuck we need to be doing, I’m done with meetings.”

  Kessler argued that Robeson was only pressuring the defendants to disclose their plan, but the appeals justice seemed to disagree. “I’m reading this as, ‘We need to make a plan,’” she said.

  The appeals justices presiding over the case were Judge Joan Larsen, Judge Chad Readler, and Judge Stephanie Davis. Audio, but not video, of the hearing was streamed, making it difficult to identify which justices were speaking.

  A recap of the hearing can be found here:

  Oral Arguments on Appeal: Adam Fox & Barry Croft, Whitmer “Kidnap Plot” Case https://t.co/CcBkLJFMOb

  — Radix Verum (@NotRadix) May 2, 2024

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

  The court reserved its decision for a later date.

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

  Tyler Durden
  Sun, 05/05/2024 – 22:10

• There Is Nothing Exceptional About US "Exceptionalism"
  There Is Nothing Exceptional About US “Exceptionalism”

  By Peter Tchir of Academy Securities

  On Friday, after the jobs report, we heard a lot of chatter about “Goldilocks.” While we wrote NFP – Great for Markets, we caveated that with – for now. Normally we would agree that there is a “transition” period from “everything is great,” to “everything is bad.” While I’m not saying that everything is bad, I do wonder if we can have more of a “gap” than a transition, largely due to the influence that “American Exceptionalism” has had on people’s perceptions. According to Google Trends, the term peaked on searches this year the week of February 4th and is declining again

  Yes, there are some things that have been exceptional. AI has certainly been exceptional on many fronts. The U.S. efforts to help stop Iran’s missile barrage was also exceptional. Away from that, I’m seeing less and less “exceptionalism.” Normally that wouldn’t matter, but I can’t help but wonder if the use of that term has made us interpret data too positively? That we ignore negatives and dwell on positives that support that theory? I’m concerned that we are, which means that we might have less of a transition than a gap, as investors start looking beyond earnings (indicatively, as BofA’s Michael Hartnett just wrote, “US exceptionalism is driven by ‘exceptionally’ easy fiscal policy.”).

  Market Exceptionalism

  It would be easy to understand if the proverbial “person in the street” thought that big tech was by far the best investment possible. On any given day, American Exceptionalism battles with “You Need to Own Big Tech” for airtime. Heck, the term “Magnificent 7” is still bandied about, though it hasn’t been a particularly useful way of expressing market moves for many months. Yet, since January 31st, other major markets have outperformed the Nasdaq 100, a good benchmark for “big tech.” Some (like China) by significant amounts. I did use the Hang Seng Index rather than Shanghai in the below because Shanghai was closed for a few days so won’t show the full performance until next week, though that performance was picked up by FXI and KWEB – the two ETFs I look at for China.

  

  When, as a strategist, I tell people that I’ve been recommending trading the Nasdaq 100 from the short side (selling rips, as opposed to buying dips, though the behavior is similar), people look at me almost with sympathy. When I add in that I have liked China “for a trade” (I still don’t think it is investible for the longer-term), the sympathy turns to outright pity. Yet the data doesn’t warrant that perception.

  What happens if more and more people start focusing on the divergence between the messaging and the actual performance?

  While earnings have helped, I’ve seen a couple of things that caught my eye. I did not verify them, but they sounded reasonable:

  • Sales, in particular, have been mediocre relative to inflation, and the average has been propped up by a minority of large companies that are crushing it.
  • Earnings, while doing well, are heavily skewed by about 20% of the S&P 500 that is doing extremely well!

  Both of these items, which seem reasonable (though I haven’t verified the data myself), would indicate that many companies are living in a world that is far from exceptional. That reality hasn’t hit more broadly, but will it, as we’ve now made it through most of the highest profile earnings reports.

  “Exceptional” Economic Data

  I could fill this section with so many charts, that it would test my patience with Bloomberg’s charting function. We will only go with two charts (and a separate section on jobs).

  

  The Citi Economic Surprise Index went negative. This index is always interesting because it combines shifting expectations with changes in data. It tends to oscillate because as data comes in strong, many economists increase their expectations for future data, making it more and more difficult for the data to exceed expectations. The opposite also tends to happen. As data underperforms expectations, economists can retain their apparently lofty expectations, hoping that the data will change direction, or (and I believe far more likely) they can reduce their expectations.

  Just like for earnings estimates, this process of downgrading the economic outlook could help bonds and make many question growth.

  There are all sorts of reasons why we can say that the importance of the Chicago PMI as an indicator has declined (shifts in manufacturing, relative importance of the region versus other regions, etc.). Having said that, this chart caught my eye.

  

  We’ve reached levels only seen during what could be described as “crises.” The good news is that often the bottom of PMI marked a great investment opportunity. That could be the case here, except that we are still near all-time highs, rather than having endured dramatic selloffs (like in previous bottoms). Again, I understand that this particular measure might not be as emblematic of the nation’s prospects as it once was, but this was pretty darn stark!

  ISM manufacturing PMI came in below 50 (yeah, I know that we are not a manufacturing-based economy), while it had prices paid spiking and employment shrinking. ISM Services, on Friday morning amidst all the Goldilocks chatter, came in at 49.4 (yes, a service index came in below 50). That index also showed higher prices paid (59.2) with weaker employment (45.9). I’m not sure why that got so little attention, because it doesn’t seem very Goldilocks to me! Okay, the S&P Global U.S. Services Index came in at 51.3, so maybe that offset ISM services, but that isn’t a particularly strong number either.

  We could explore revolving credit debt (increasing rather substantially), delinquencies (rising, but still manageable), etc., but we are running out of time and space today.

  “Exceptional” Jobs Data

  Non-Farm Payroll finally went from exceptional to good. But as I scour the data for confirmation of how strong jobs (as reported by the Establishment Survey) have been, I struggle to find it.

  Employment seems weak in many of the surveys, as cited above.

  The JOLTS data has shown a steady decline in jobs available. First, I question whether the methodology has truly captured the use of online job searches correctly. How many “stale” or even “fishing expedition” postings are out there (postings where there is no real job opportunity, but if an “exceptional” and I do mean exceptional candidate applies they would make an effort to find a job for that person).

  

  It makes sense (regardless of how accurate the data is) that in an economy that is growing, there is a general pattern of increases in jobs available. That trendline has potentially been broken. We have about 900k more jobs available than we did in November 2018. Yes, actual jobs are more important than jobs available, but I think that we’ve moved back to a “normal” number of jobs available.

  But I digress since I care more about the QUIT and HIRE rates from JOLTS. I think they tell us as much or more about the true state of the jobs market than almost any other data we get.

  

  The QUIT rate, an indicator of how comfortable employees are with quitting (presumably because they believe they can find another similar or better job quite easily), has dopped to a level that is lower than in 2018 and 2019 and back to a 2015 to 2016 average.

  The HIRE rate is even worse. This indicates hiring on a relative basis, and we are now back to levels seen in 2014.

  We are hiring less, there are fewer jobs available, and people are seemingly afraid to quit, so let’s focus on one part. The Establishment Survey, that has a notorious track record of being revised downward by large amounts, has lower and lower initial response rates, and does “its best” to estimate business creation. The Birth/Death model (what a horrible name) provided 363,000 of the (wait, checks notes) 193,000 jobs created in the private sector.

  I like my “exceptionalism” to be exceptional, and I also like my data not to be dwarfed by “plugged” numbers. My understanding of the Birth/Death model is that it relies heavily on EIN applications to determine new businesses, which I think has been overstated as anyone from rideshare drivers to people trying to make a buck on social media have applied for EINs to treat themselves as businesses.

  I cannot help but wonder if even on the jobs front, which has been close to exceptional, we are exposed to some sort of gap in perception, and we might wind up finding out that Goldilocks met the wrong group of bears and the story doesn’t end so well.

  Bottom Line

  Lower yields. On Friday, I reiterated our range of 4.4% to 4.6% on 10s. I suggested fading the move at 4.45%. While I still think “deficits” and “supply” will push us higher, I think we have some protection here as the economic data surprises to the downside and as economists ratchet down their forecasts. And simply assuming noise around the true rate of inflation, we could see a pleasant inflation print or two. I think we can own yields here, and will bring back the range to 4.3% to 4.5% on 10s. I’m still in the 2-cut camp, which seems more likely, though I’m leaning towards June/July which seems a bit aggressive.

  What do lower yields mean for stocks? That is just such a tricky question as the relationship between yields and stocks has been all over the place. I think that we will see outperformance of small caps, banks, and value here. We’ve seen the S&P 500 moderately outperform the Nasdaq 100 in the past three months and I think that we will see more sectors and industries shift into outperformance mode. We may (probably will) see stocks respond positively to lower yields. But, I am concerned that we won’t see a smooth and gradual transition from “no landing” to “soft landing” to “bumpy landing” and we will jump from “all good” to “all is not-so good” rapidly because we have been ignoring data pointing us to this transition for the past few weeks (or months). So, I remain a better seller of risk here, though won’t fight a rally at the start of the week too much (if one materializes).

  Credit. Reduce exposure to the weakest credits and those most tied to the economy. We could see a period where economic conditions warrant a rate cut, but inflation fears keep the Fed on the “higher for longer” mantra. That should hurt some of the weaker credits, but I don’t see a material threat to overall risk, unless we see stocks respond more negatively than they have.

  Good luck and May 5th is my favorite day of the year!

  Tyler Durden
  Sun, 05/05/2024 – 21:00

• "People Will Be Teleporting Between Planets" Before California Finishes High-Speed Rail Project
  “People Will Be Teleporting Between Planets” Before California Finishes High-Speed Rail Project

  X users mocked the California High-Speed Rail Authority’s post on the social media platform, which celebrated building a bridge that goes nowhere. 

  “The Fresno River Viaduct in Madera County is one of the first completed high-speed rail structures. At nearly 1,600 feet long, high-speed trains will travel over the riverbed and will run parallel with the BNSF Railroad,” CAHSR wrote on X. 

  The Fresno River Viaduct in Madera County is one of the first completed high-speed rail structures. At nearly 1,600 feet long, high-speed trains will travel over the riverbed and will run parallel with the BNSF Railroad. #BuildHSR pic.twitter.com/zWqusPbOB9

  — CA High-Speed Rail 🚄💨 (@CaHSRA) May 1, 2024

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

  Billy Markus, the co-founder of Dogecoin, joked, “This is the most remarkable human achievement ever, 1600 feet of high-speed rail after 9 years and 11 billion dollars.” 

  this is the most remarkable human achievement ever, 1600 feet of high speed rail after 9 years and 11 billion dollars

  it takes about 5 minutes to walk 1600 feet so a high speed rail for that is a really big deal

  california is so competent https://t.co/Uff4LT57tZ

  — Shibetoshi Nakamoto (@BillyM2k) May 3, 2024

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

  Venture capitalist David Sacks said, “Building products on time and on budget requires a monomaniacal leader who kicks asses to make things run right. Government, which is based on lobbying, backscratching and committee-based decision-making, is uniquely unsuited for this.” 

  Building products on time and on budget requires a monomaniacal leader who kicks asses to make things run right. Government, which is based on lobbying, backscratching and committee-based decision-making, is uniquely unsuited for this. https://t.co/y6ymY96nFF

  — David Sacks (@DavidSacks) May 4, 2024

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

  “People will be teleporting between planets by the time California achieves high speed rail service from Merced to Bakersfield,” one X user quipped. 

  People will be teleporting between planets by the time California achieves high speed rail service from Merced to Bakersfield.

  — Jonofarcadia 🦬 (@jonofarcadia) May 2, 2024

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

  Another user said the partially built Los Angeles-to-San Francisco high-speed rail project could accommodate the homeless and migrants. 

  It will be home to thousands of homeless

  Long before a single train travels it pic.twitter.com/t2m3D9zaxq

  — Marc Escens (@Marc_Escens) May 4, 2024

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

  Perhaps California officials should stop gaslighting taxpayers about a decade of work and billions spent – only to come up with a bridge to quite literally nowhere. Big government is inefficient and wasteful. The state controlled by radical progressives is a trainwreck. 

  Tyler Durden
  Sun, 05/05/2024 – 20:25

• "Economics Works In Mysterious Ways": Is China's Wealth Effect Being Substituted?
  “Economics Works In Mysterious Ways”: Is China’s Wealth Effect Being Substituted?

  By Teeuwe Mevissen, Senior Macro Strategist at Rabobank

  Is the wealth effect being substituted?

  Summary

  • China’s real estate market suffered heavy losses early this year while stock market investors continue to face huge uncertainty.
  • This will add to the deterioration of household balances and as such could influence private domestic (consumer) demand.
  • While the wealth effect predicts a deterioration of consumption, the substitution effect would predict the exact opposite.
  • This paper concludes that the substitution effect is more likely in the case of real estate.
  • This could be explained by the fact that housing is still expensive despite declining housing prices while at the same time wages are suppressed and youth unemployment is high.
  • But more explanations (like prepayment risks) could be given for the positive correlation between housing prices and the savings ratio.

  Introduction

  The new year in China kicked off with turmoil on China’s stock markets. Amongst others, the decision of the court in Hong Kong to liquidate real estate giant Evergrande further undermined investors’ confidence in China’s stock market. A market that already had been battered during the last three years due to ongoing worries about China’s economic prospects, regulatory crackdowns, a changing geopolitical landscape and a real estate sector in crisis. While China’s stock markets have pared some of the most recent losses due to (expectations of) increased government support, investor sentiment will likely remain fragile for some time to come. Moreover, many of the recently imposed government regulations, such as short selling curbs, are likely to be temporary assuming China is really serious about attracting more foreign investments. This follows from the fact that a full functioning market environment includes the possibility to sell stocks short and let market forces determine market outcomes.

  Given that stock markets tend to be a leading indicator for the economy’s travails, this special zooms in on the question what the recent market turmoil could mean for China’s economic prospects in the coming year(s). The relation between the stock market’s performance and economic prospects is, amongst others, reflected by the expected future cash flows that companies are expected to make. But there may also be a wealth effect which predicts a positive relationship between stock market performance and consumption. Since the value of real estate also affects the willingness to consume, we also take a closer look at this particular topic in this research note. But before we do so, we will start with a general overview of China’s stock markets, its performance over the last 5 years and the measures that China’s government has implemented so far in order to prevent a further slump, which already evaporated a stunning amount of $7 tn during the recent lows in February. For more information regarding the real estate sector we refer to an earlier publication that covered this topic.

  China’s stock markets experiencing a rout.

  After a sharp recovery of China’s stock markets in 2021 – which was part of a global relief rally that followed the panic sell-off in March 2020 – 2022 saw investor sentiment souring and China was no exception. However, whilst Western indices recovered sharply thereafter, China’s stock markets struggled to keep up during the first half of 2023 and showed a very poor performance in the second half of 2023. The start to this year can only be characterized as a true stock rout. As a result, the benchmark MSCI China stock index is down 60% from its peak in 2021. All in all the total decline in value of China’s stock markets is approximately 7 tn renminbi (close to $1 tn) since the peak in 2021. The majority of these losses are borne by domestic holders of Chinese equities and retail investors in particular.

  

  Some background on China’s stock markets

  China’s restrictions related to foreign investments, geopolitical tensions and regulatory crack downs have soured foreign investors’ appetite for Chinese stocks and in October 2023 it was estimated that foreigners only hold $600 billion in Chinese stocks listed on mainland China or Hong Kong. This is indeed a small share of a total market capitalization that is estimated to be a little less than $9.7 tn in January 2024. While institutional investors’ share in Chinese stock holdings has significantly increased over the past two decades, China’s stock markets are still more influenced by retail investors than is the case in, for example, the United States. The box below explains some of the most common features of its stock market.

  

  The structure of China’s stock market is important because it gives an idea of who has ownership and to what share classes. But for this it is clearly also relevant to have an idea about the total market capitalization of China’s main stock markets. This is why we show a table below that provides an overview of China’s stock exchanges ranked by market capitalization and which also includes the stock market returns YTD and for longer periods; It also provides an estimated breakdown between the share of private owned enterprises and state owned enterprises where available.

  

  Connecting the stock market with consumption

  While stock markets are less connected to the economic process and performance in China than is the case in most advanced economies (for instance, equity financing plays a relatively small role for China’s corporates who generally rely more on retained earnings and bank loans), the recent stock market rout adds to the wealth loss Chinese households already had suffered from China’s real estate crisis.

  As can be seen from figure 4 below, surveyed consumers continue to signal weak confidence regarding developments related to employment and, related to it, income. Furthermore, consumer confidence is near record low levels. Moreover, close to 60% of respondents expect to increase savings in the next quarter while less than 25% of respondents indicate that they are expecting to consume more in the next quarter. We do note, though, that the most recent data is from Q2 2023.

  

  Measures to support China’s stock markets

  While most recently Beijing fired the head of the China Securities Regulatory Commission (CSRC) Yi Huiman and replaced him with Wu Qing, it is questionable whether this will result in the much needed restoration of investors’ confidence. However, as a previous head of the Shanghai Stock Exchange and in various roles within the CSRC, where he earned the nickname ‘the broker butcher’, it seems that a further crackdown on illicit trading practices is on the cards.

  Several other measures have been announced, although the majority lacks details as is often the case when new policies and/or guidelines are announced. Below is a broad selection of measures that have been decided upon in recent months:

  • More liquidity support for developers
  • The CSRC announced it would look to support listed companies to find possibilities to merge and or restructure businesses in order to create value
  • Sales of stocks were also restricted for some domestic institutional investors as well as some offshore units of those investors
  • A lowering of 0.5% of the reserve ratio requirement for banks
  • Monetary authorities provided 1 tn yuan extra liquidity into the markets in order to provide ample liquidity
  • Promises to deal with margin call risks
  • More active involvement of the CSRC in addressing concerns from listed companies
  • Placing restrictions on security lending

  More recently announced measures are:

  • Cease displaying real-time data for flows into the world’s second-largest stock market through Hong Kong
  • China’s ‘national team’ buying for $50 billion of stocks
  • Clarification of new delisting rules which are aimed at zombie firms
  • Tighten stock listing criteria
  • Crack down on illegal share sales
  • Strengthening the supervision of dividend payouts

  While the PBOC has added additional stimulus since the end of last year, this stimulus still seems not to have fully fed into China’s economy and the real estate sector. Earlier this year, the PBOC offered 1 tn renminbi in loans to the banking sector and lowered the reserve requirement ratio by 0.5% bringing the average RRR for financial institutions to ‘about 7.0% after the cut’. A move that is expected to free up about 1 tn yuan according to the central bank chief who held a press conference in Beijing on Wednesday the 24th of January.

  The last and perhaps most draconic measure announced this year is a ban on net stock selling during the first and last 30 minutes of a trading session. This measure came into effect on the 21st of February. This makes it harder for entities affected by this measure (mainly hedge funds and institutional investors) to apply certain trading strategies. At the same time it makes it easier for government-backed funds to influence the stock market during those crucial trading windows.

  These measures clearly influence the extent to which stock valuations are determined by market mechanisms but they won’t increase the profitability of any company traded at any of China’s stock exchanges. It also remains to be seen how offshore investors will react on measures that increase the risk of not being able to sell your stocks anymore because of decreasing liquidity on the sellers’ market. Moreover, the restrictions on security lending are likely to have more effect on stocks listed on the Hong Kong exchanges than those listed in Shanghai. Mostly because stocks listed on the Shanghai stock exchange are held for more than 80% by individual investors vs 15% of stocks traded at the Hong Kong stock exchanges.

  While Chinese stock markets initially showed a sharp recovery since their February lows, the stock rally seems to have stalled again since the midst of March. Taking all of the above into account, it remains to be seen whether the recent recovery of stock prices can be continued, especially when the current stock market trading curbs would be lifted again.

  How the loss of wealth could lower consumption

  Wealth effect

  We will now look at a few behavioral phenomena when it comes to the relationship between wealth and consumption. This so-called wealth effect is a behavioral economic theory which postulates that peoples’ willingness to spend increases when the wealth of their homes or asset portfolio increases because they feel more financially secure. Since (for now) we want to exclude the extreme swings of consumption and stock market prices arising from the Covid-19 pandemic (which is even more relevant given China’s strict lock down measures and its obvious effect on consumption), we first use the results of an academic paper from 2010 which studies the importance of the wealth effect on China’s consumer spending.

  This paper estimates a long run consumption elasticity of total assets to be around 0.51 or roughly one half. This would imply that a 20% drop in share prices would result in a drop of about 10% in consumption. Compared to Western elasticities, which are often found to be closer to 0.05, this is extremely high. Based on such a positive relationship between wealth and consumption, one would expect a significant negative impact on consumption from the recent decline in house and equity prices. The elasticity on income is estimated at 0.76, which seems plausible in our view.

  Based on the elasticity from the paper above and given the price developments of the separate asset classes we can make a rough estimate of the impact of declining asset prices on consumption. We take 2021 as the starting point because the real estate crisis started in the summer of 2021 and we want to omit the results during the pandemic because of reasons discussed above. These estimates are shown in table 2 below. We abstain from the impact of increased saving via (bank) deposits.

  

  This is based on a total value of real estate in China of $55tn in 2021. So, if we assume the elasticities from this paper to be realistic, this suggests that the decline in asset values has depressed consumption by some 3.4% since August 2021. This would amount to a drop of consumption of more than $2 tn! Given a level of nationwide per capita consumption expenditure of 26.796, a total population of 1.425.000.000 people and the current USD/CNH exchange rate of around 7.25, this would boil down to a total amount of consumption of $5.3 tn. Our estimates above are generally inline with other research indicating that ‘a 5% decline in home prices will wipe out 19 trillion yuan ($2.7 trillion) in housing wealth’.

  We should also add, though, that rising incomes have overshadowed its impact so that a positive gain in consumption (in nominal terms) results after all.

  The (opposite) substitution effect

  Having said this, there could also be reasons to assume an increase in consumption. So how would that work? Young people in China have been faced with a prolonged episode of rising housing prices while at the same time facing high levels of youth unemployment and an economy slowing down. As such, young people have increasingly felt discouraged. This has even led to the so-called lying flat movement, where young people deliberately choose to not join the tough rat race that recent graduates face when entering the labour market. Additionally, despite the gradual decline of house prices (both newly built and existing homes), suppressed wages have not made housing that more affordable especially in China’s tier-1 cities. This may have led many young people in China to delay or even give up on buying a house entirely.

  Another reason why some young people are delaying or have given up on purchasing a house is the huge impact it has on the ‘quality of life’. Young people that have been able to purchase a house face relatively high monthly mortgage payments despite significant down payments. This has led a large amount of young Chinese citizens increasingly willing to spend their money on
  consumption like traveling. This effect is called the substitution effect. Many economists have indeed claimed that the effect on consumption of declining stock and housing prices in China is different. Let’s say a wealth effect with Chinese characteristics, i.e. an inverse wealth effect.

  For about two decades, consumption in China has been partially suppressed since households had to channel an unusual large share of their income to savings in order to make the necessary down-payment for purchasing a house. Back then, this often boiled down to about 30% of the value of the house. In other words, consumption was substituted for expenditures on housing. Indeed last year we saw signs of the substitution effect when the savings rate for households dropped while real estate prices dropped as well. This effect is in sharp contrast with the findings of the wealth effect discussed in the academic paper mentioned earlier.

  Our data shows yet another picture

  Since we lack data about the net savings rate for households in China we have derived the savings ratio by subtracting household expenditures from disposable income. We plot this estimated saving ratio against both real estate prices as well as the Shanghai Stock Exchange Composite Index. This results in the two graphs below:

  

  While positive correlation between (inflation-adjusted) real estate prices and savings (i.e. a negative correlation with consumption) is evident from the first graph, stock prices don’t seem to have an impact on private domestic savings or consumption at all. Both results are at odds with the results from the academic paper discussed above whilst the first chart suggests that there is – if anything – a substitution rather than wealth effect.

  However, we should be aware of the fact that in China, the major component of household wealth is invested in real estate and not the stock market. As such, declining stock prices could reduce consumption of the holders of these stocks; but if only a relatively small percentage of China’s citizens hold stocks or if many Chinese citizens only hold very small portions of their wealth in stocks, the impact on an aggregate level would still be negligible.

  It is therefore important to take into account that approximately 70% of household wealth is in real estate while it was estimated in an article published by Atlantic press that household financial assets only accounted for about 13%. The rest is allocated towards other financial assets like saving accounts, deposits, gold etc. etc. The important conclusion we can draw from these figures is that much of the wealth of China’s households is either being held in illiquid assets, such as real estate or in low return deposits. From this angle it becomes easier to understand why in China the wealth effect arising from declining stock market prices is less likely to have a significant influence on consumption patterns.

  Moreover, as we argue, the wealth effect arising from the developments in the real estate sector, may not apply in the case of China. We therefore conclude this special by discussing a number of explanations for the observed effect from real estate prices on consumption.

  What about other factors? (prepayment risk)

  Above we have shown conflicting findings on the existence of a wealth effect in China arising from price developments in both the real estate- and stock market. While older research seems to conclude that the wealth effect is indeed present, most recent data seems to indicate the absence of it. Indeed, in the case of real estate we actually observe an opposite effect, i.e. lower housing prices lead to lower saving rates. Does this mean that we observe a substitution effect in China? We would, albeit hesitantly, answer this question with a yes. But there could be more at play.

  Aside from the substitution effect which has been outlined above, lower interest rates could also play a role. This is via the so called prepayment risk. It is well known that when interest rates and/or housing prices decline, house owners tend to increase their mortgage payments in order to reduce their outstanding amount of mortgage debt. Most mortgage prepayment models indeed predict increasing prepayments when the contract rate and the current market rate diverge, i.e. a situation where the contract rate is significantly higher than the current market rate.

  One way to look at this phenomenon is the following: house owners have an incentive to refund themselves against lower rates and pay off the outstanding amount of mortgage debt if the terms and conditions of the mortgage allow for this. However, prepayment risks can also work in the opposite direction. When home owners expect rising interest rates the home owner also has an incentive to repay the mortgage more quickly to avoid higher interest rate payments in the future. Since interest rates have gradually and steadily declined in China, the former prepayment risk is more likely.

  Additionally, the relationship between real estate prices and consumption is not necessarily static. Its effect could very well change over time. A prime analogy is the famous Phillips curve that tries to explain the inverse relationship between (wage) inflation on levels of unemployment. If other factors occasionally flip the relationship between wealth and consumption this would make it very hard to predict the impact of real estate prices on consumption at any point in time. Finally, developments in the labor market, such as adverse job conditions, could also impact the savings rate where higher unemployment levels lead to decreasing levels of savings and consumption, if households are forced to dip into their savings to maintain consumption levels.

  Finally – as our analysis shows – the consumption effect arising from the rise in disposable income (which according to the paper has an elasticity of 0.76) has offset the wealth effect arising from the decline in assets. This could be another reason why the predicted decline in consumption cannot be observed.

  Conclusion

  Altogether it is extremely hard – and with a lack of relevant data – impossible to draw strong conclusions about a permanent presence or absence of a wealth effect arising from price developments in the real estate sector in China. Unfortunately we cannot present a solid relationship between real estate price developments and consumption. At his point in time we can only conclude that we observe a negative relationship between consumption and house prices and offer some reasons that are likely to have influenced this relationship, with prepayment flows and possibly a weak labor market situation as relevant factors. The only firm conclusion we can draw is that economics continue to work in mysterious ways.

  Tyler Durden
  Sun, 05/05/2024 – 19:50

• The Ideological Roots Of The Open Borders Push
  The Ideological Roots Of The Open Borders Push

  Authored by Simon Hankinson via The Epoch Times,

  Why does the Biden administration want open borders? As a researcher and writer on immigration, that’s the question I often get asked.

  

  Here are the three reasons I think are behind President Joe Biden’s deliberate border chaos:

  1. electoral politics,

  2. extortion, and,

  3. most insidiously, ideology.

  I’ll start with ideology and come back to the other two reasons in my next columns.

  The most dangerous driver behind Biden’s open borders is ideological. Policy differences can be negotiated, but as we’re seeing on college campuses, people fanatically committed to an idea can prove intransigent, regardless of the facts.

  When you see the word “abolition” used in connection with criminal justice and immigration, you might be confused. Americans rightly associate the term with ending slavery and abolitionists like William Lloyd Garrison who were active before the Civil War.

  Why are academics, politicians, and race professionals using it in 2024?

  Those saying “abolitionist” today have appropriated it for the positive historical connotation it possesses, but they mean something else entirely. To see the roots of their ideology, you have to go back to the dawn of the New Left, as described by Chris Rufo in his book “America’s Cultural Revolution.”

  Under their intellectual godfather, German academic Herbert Marcuse, Marxist-Leninists, Black Panthers, the Weather Underground terrorist group, and Students for a Democratic Society gathered.

  This leftist alliance believed—as the Students for a Democratic Society magazine Prairie Fire explained—that the United States was founded on genocide, slavery, and racism. Its goal was to abolish the existing capitalist America and build a new society. One element of this was destroying the justice system. The Black Panthers’ manifesto thus called for the release of all black men who were incarcerated, no matter for what crime.

  As Rufo writes, “[Communist Angela] Davis and her comrades began to call not for the release of individual criminals, but for the abolition of the entire system.” Davis said that “a society without racism … has to be a society without prisons.”

  The Black Lives Matter organization adopted the same agenda of “abolition.” The mobs that destroyed a police station and looted Minneapolis in 2020 shouted, “Abolish the police, then the prisons.” The “abolitionist” activists in the Seattle CHAZ commune wanted to abolish the police, prisons, and courts.

  BLM founder Patrisse Cullors was crystal clear in this Harvard Law Review essay from 2019: “Abolition means no borders. Abolition means no Border Patrol. Abolition means no Immigration and Customs Enforcement.” America is the source of world evil, in her view, and thus has no right to exist as a nation state nor keep anyone in the world from entering its borders.

  Some Biden administration officials seem to share this core belief. Avideh Moussavian, a senior appointee at U.S. Citizenship and Immigration Services, tweeted “#abolishICE” in 2018 and “cut ICE and [Customs and Border Protection] funding” in 2019.

  Another Biden appointee, Claire Trickler-McNulty, undermined ICE from within before leaving for a nongovernmental organization partly funded by the Vera Institute for Justice. The Vera Institute says, “The U.S. immigration system is an arrest-to-deportation pipeline rooted in racism,” wants no detention of people in the United States illegally, and grants millions to nongovernmental organizations defending illegal immigrants.

  “Abolition” ideology also has clear links with today’s campus support of Hamas. Take a look at this course taught at Columbia University this Spring by professor Mohamed Abdou, titled “Decolonial-Queerness and Abolition in SWAN.” SWANA likely stands for South West Asian and North African people. A sentence from the course description sums it up:

  “Using intersectional/assemblage-based theories, what decolonial, gender-based readings and formulations of feminisms/queerness exist that evade the apparent tidiness of European feminist and narrow LGBTQIA categories that characterizes most (non)Euro-American political queer-feminist scholarship beyond the depiction of queer BIPOC as co-opted and duped, colonized pawns of ‘Gay Empire’ towards elucidating critical discussions on identity, agency, subjectivity, and dissidence?”

  Parents are paying $90,000 a year for their kids to learn that kind of balderdash. But even if you can’t make any sense of that sentence, you can be sure of what Abdou means by “abolition.”

  Columbia University now resembles Gaza as designed by outdoor equipment retailer Eastern Mountain Sports. Meanwhile at Princeton University, students briefly set up a camp last week “in solidarity with Gaza to protest Princeton’s role in funding the ongoing genocide,” according to organizers Princeton Israeli Apartheid Divest.

  Dan-el Padilla Peralta was among faculty who signed a letter supporting the Princeton students and boycotting Columbia University. He is a “classics” professor who calls his field “equal parts vampire and cannibal” and the foundation of white supremacy, and argues that it should be abolished.

  Peralta came from the Dominican Republic as a child, and his family overstayed their visas and became illegal immigrants. Leftist academics such as Peralta do not like nations or borders any more than they do classical antiquity. In his book “Undocumented,” Peralta wrote, “Demography is a [expletive]. Holla at me if you want me to break it down for you.” By this, Peralta implies that without immigration enforcement, the “global majority”—defined here as everyone but white Europeans—will be able to dominate every country.

  What we’re seeing at the southern border and on college campuses comes from the same ideological roots and ends the same way: anarchy.

  *  *  *

  Reprinted by permission from The Daily Signal, a publication of The Heritage Foundation.

  Views expressed in this article are opinions of the author and do not necessarily reflect the views of The Epoch Times or ZeroHedge.

  Tyler Durden
  Sun, 05/05/2024 – 18:40

• The World's Fastest Growing Emerging Markets (2024-2029 Forecast)
  The World’s Fastest Growing Emerging Markets (2024-2029 Forecast)

  Large emerging markets are forecast to play a greater role in powering global economic growth in the future, driven by demographic shifts and a growing consumer class.

  At the same time, many smaller nations are projected to see their economies grow at double the global average over the next five years due to rich natural resource deposits among other factors. That said, elevated debt levels do present risks to future economic activity.

  This graphic, via Visual Capitalist’s Niccolo Conte, shows the emerging markets with the fastest projected growth through to 2029, based on data from the International Monetary Fund’s 2024 World Economic Outlook.

  

  Top 10 Emerging Markets

  Here are the fastest-growing emerging economies, based on real GDP compound annual growth rate (CAGR) forecasts over the period of 2024-2029:

  

  As South America’s third-smallest nation by land area, Guyana is projected to be the world’s fastest growing economy from now to 2029.

  This is thanks to a significant discovery of oil deposits in 2015 by ExxonMobil, which has propelled the country’s economy to grow by fourfold over the last five years alone. By 2028, the nation of just 800,000 people is projected to have the highest crude oil production per capita, outpacing Kuwait for the first time.

  Bangladesh, where 85% of exports are driven by the textiles industry, is forecast to see the strongest growth in Asia. In fact, over the last 30 years, the country of 170 million people has not had a single year of negative growth.

  In eighth place overall is India, projected to achieve a 6.5% CAGR in real GDP through to 2029. This growth is forecast to be fueled by population trends, public investment, and strong consumer demand.

  Tyler Durden
  Sun, 05/05/2024 – 18:05

• Pritzker Doubles-Down With $827 Million Taxpayer Handout To Troubled EV-Maker Rivian
  Pritzker Doubles-Down With $827 Million Taxpayer Handout To Troubled EV-Maker Rivian

  Authored by Mark Glennon via Wirepoints.org,

  At $1.5 million per job, this new incentive package from the state is at least 15 times the norm. For this much money, the state could have just handed out a million bucks to 827 people, instead of creating 550 jobs.

  

  Gov. JB Pritzker announced Thursday that the State of Illinois will provide an $827 million incentive package for Rivian to invest $1.5 billion to expand its electric vehicle factory in Normal, Illinois. The expansion is expected to create at least 550 full-time jobs within the next five years, and will build Rivian’s next model EV, the R2. Rivian initially got $49.5 million under Gov. Bruce Rauner in 2017 to create 1,000 jobs at the same location.

  The new deal gives $1.5 million per job created, which is astronomical in the world of location incentives. Estimated average location incentives paid by state and local governments around the nation range from $13,000 to $84,000 per job, though sometimes go as high as $100,000 per job for capital intensive projects. Even using that high end, Rivian’s package will be 15 times what’s typical.

  Moreover, Rivian is on shaky wheels, along with the rest of the U.S. EV industry. Rivian loses over $43,000 for every vehicle it sells and has had two rounds of layoffs this year. The decision to move its R2 production to Illinois is a further reflection of the company’s need to preserve cash. R2 production was initially planned for a new $5 billion plant in Georgia, heavily subsidized by the state. But Rivian concluded that moving production to the existing Illinois facility would save cash.

  Its stock price has consequently been hammered. It reached a high of $172 per share in 2021 but now trades at less than $10 per share.

  

  Rivian is not alone. As a CNBC headline recently declared, “EV euphoria is dead. Automakers are scaling back or delaying their electric vehicle plans.” Since then, the news is no better. Ford announced last week that it is losing a stunning $132,000 per vehicle. Hertz announced last week a second round of sales of its EV fleet due to heavy maintenance and depreciation costs. For the first quarter of this year, EV sales continued to slow and the share of EV sales for all autos actually decreased. While total EV sales are still up a bit from last year, the growth rate is not nearly enough to put EV makers on a path to profitability.

  EV makers pin their hopes on less expensive models that they promise soon, and on more public charging stations, into which Illinois last month announced it would invest an additional $50 million. Rivian hopes its new R2 will be among the new, lower priced models. However, its starting price is expected to be about $45,000 and it won’t come out until the first half of 2026.

  Regarding the astronomical incentive package to be paid by Illinois, in fairness, it should be noted that most of it is in the form of tax credits to be granted over the next 30 years. They are available on condition that the company retain 6,000 already existing jobs. However, the fact remains that just 550 new jobs are to be created, and incentive packages like this are not supposed to be payoffs for merely standing still. And a less charitable way to look at it would be that future taxpayers will be on the hook for the high cost of the incentive package — if it works.

  Aside from thinking that the incentive package is too low, my first instinct was to ask, “Where’s the warrant coverage.” That is, I know from working as a lawyer and then as an investor, often with troubled companies, that it’s not unusual to make risky bets. However, it’s routine for the investor to get part of the upside if the venture succeeds, usually in the form of stock or warrants (basically, options) on stock that pay off nicely if things turn around. The federal government, for example, got stock and warrants as part of the deal for its 2010 bailout of the auto industry.

  This new Rivian deal has nothing like that. Since the job creation per dollar is minimal, it’s just not worth the price.

  Tyler Durden
  Sun, 05/05/2024 – 17:30

• Man vs Bear Debate: The Dumbest Feminist Argument Yet?
  Man vs Bear Debate: The Dumbest Feminist Argument Yet?

  When it comes to identifiable differences in female vs male psychology as well as differences in brain biology, as a general rule and as most studies show women focus far more on feelings than men do.  Specifically, women tend to be more sensitive to negative emotions and negative imagery.  Obviously, men and women are not the same, never have been the same and never will be the same, and this includes how they process information and come to conclusions.

  This is the reason why many of women’s perceptions on life tend to bewilder men; most women operate from a place of emotion and assumption (which they call “intuition”) and come to conclusions based on feelings rather than facts.  Intuition can be a powerful tool for identifying threats before they occur, and when women get it right they might appear to be clairvoyant. However, when they get it wrong they get it really wrong and the result is foolishness and disaster.

  How one feels is not necessarily what is true. 

  Enter feminism, a movement which claims to be fighting for women’s “equality” but is actually fighting for women’s privilege.  Legal equality for the sexes was achieved long ago and one would think that feminism would have faded away with its mission accomplished.  This has not been the case.  Instead, feminists move the goalposts and the notion of equality has given way to desires for power.  But unlike most political movements feminism does not chase power by applying direct force (in most cases).  Rather, feminists chase power by magnifying and exaggerating their own weaknesses and victimhood. 

  In other words, they gain power by demanding reparations for perceived injustices.  The more they feel oppressed or afraid or abused the more power society supposedly owes them.  Feminism exploits the natural tendency of women to hyperfocus on negative emotions and promotes feelings over logic.  If women feel like victims, that means they are victims.

  This is where the “Man vs. Bear” narrative comes from.  A bizarre thought experiment in which random women are asked if they were lost in the woods, would they rather run into a man or a bear?  The question has created considerable controversy across social media, with a majority of women apparently choosing a bear over a man.

  On the surface we can dismiss the thought experiment with the simple reality that women encounter men daily while most have never dealt with or seen a real bear in the wild in their entire lives.  If they did run into a bear all of them would be screaming for help from the nearest man available to protect them.

  It’s perhaps the dumbest feminist mind-game so far in this respect.  Life is not a Disney movie with friendly talking animals and there’s a reason why men make up the vast majority of solo hunters – Female hunters don’t want to go into the woods by themselves because they know predators like bears represent great potential injury or death.  

  To be fair, plenty of women have laughed off the question as ridiculous and pointed out the reality that with a man there’s a good chance they will be helped out of the woods.  With a bear there’s no chance.  But this hasn’t stopped feminists from pretending as if the pro-bear response represents some kind of revelation about men and masculinity. 

  

  The issue has also revealed once again that math is the kryptonite of woke activists and critical thinking is their enemy.  

  Citing the predominance of men in crime stats, feminists argue that it’s far more likely for a man to harm a woman than a bear to harm a woman.  In fact, bear encounters are far more rare than encounters with men, and the percentage of men that commit violent crimes is tiny compared to the total male population in western countries.

  By feminist logic, men are also actually safer with bears than with women.  In 2021, 1,078 men were killed by women in the U.S. There have only been 180 fatal human/bear conflicts in North America since 1784.  Again, this is about proximity.

  In 2019, there were 283,467 violent crimes committed by men in the US, out of 161 million men.  That’s around 0.1% of the male population.  The chances of a woman running into a violent man in the woods in this fantasy scenario is negligible.  Feelings are being elevated over facts. 

  Most feminist narratives lean heavily on the fear dynamic.  If women feel afraid of men then men and society must take them seriously and assuage those fears; the fears fabricated in women’s minds are suddenly everyone’s problem.  In the past society used to laugh off female melodrama as an unfortunate bi-product of their nature; how can society fix a problem that doesn’t exist in the tangible world?  But as the male commentator in the first video argues, it doesn’t matter if women are actually in danger from men, it only matters that they believe they are in danger.

  But who created that fear in women?  Was it men?  Or, was it feminist propaganda?  The numbers suggest feminism has rotted women’s minds with fear.   

  Tyler Durden
  Sun, 05/05/2024 – 16:55

• Open The Overton Window
  Open The Overton Window

  Authored by Jeffrey Tucker via DailyReckoning.com,

  You may have heard of the “Overton window.”

  

  The concept of the Overton window caught on in professional culture, particularly those seeking to nudge public opinion, because it taps into a certain sense that we all know is there.

  There are things you can say and things you cannot say, not because there are speech controls (though there are) but because holding certain views makes you anathema and dismissable. This leads to less influence and effectiveness.

  The Overton window is a way of mapping sayable opinions.

  The goal of advocacy is to stay within the window while moving it just ever so much. For example, if you’re writing about monetary policy, you should say that the Fed should not immediately reduce rates for fear of igniting inflation.

  You can really think that the Fed should be abolished but saying that is inconsistent with the demands of polite society. That’s only one example of a million.

  To notice and comply with the Overton window is not the same as merely favoring incremental change over dramatic reform. There is not and should never be an issue with marginal change.

  That’s not what’s at stake.

  To be aware of the Overton window, and fit within it, means to curate your own advocacy. You should do so in a way that’s designed to comply with a structure of opinion that’s pre-existing as a kind of template we’re all given.

  It means to craft a strategy specifically designed to game the system, which is said to operate according to acceptable and unacceptable opinionizing.

  In every area of social, economic and political life, we find a form of compliance with strategic considerations seemingly dictated by this window. There’s no sense in spouting off opinions that offend or trigger people because they’ll just dismiss you as not credible.

  But if you keep your eye on the window — as if you can know it, see it, manage it — you might succeed in expanding it a bit here and there and thereby achieve your goals eventually.

  The mission here is always to let considerations of strategy run alongside — perhaps even ultimately prevail in the short run — over issues of principle and truth, all in the interest of being not merely right but also effective.

  Everyone in the business of affecting public opinion does this, all in compliance with the perception of the existence of this window.

  It’s how ideas move from unthinkable to radical to acceptable to sensible to popular to become policy.

  The concept was named for Joseph Overton, who worked at the Mackinac Center for Public Policy in Michigan. He found that it was useless in his work to advocate for positions that he could not recruit politicians to say from the legislative floor or on the campaign trail.

  By crafting policy ideas that fit within the prevailing media and political culture, however, he saw some successes about which he and his team could brag to the donor base. A wise intellectual shepherd will manage this transition carefully from one stage to the next until victory and then take on a new issue.

  The core intuition here is rather obvious. It probably achieves little in life to go around screaming some radical slogan about what all politicians should do if there is no practical means to achieve it and zero chance of it happening.

  But writing well-thought-out position papers with citations backed by large books by Ivy League authors and pushing for changes on the margin that keep politicians out of trouble with the media might move the window slightly and eventually enough to make a difference.

  Beyond that example, which surely does tap into some evidence in this or that case, how true is this analysis?

  Read on for the answer.

  Is the Overton Window Real?

  First, the theory of the Overton window presumes a smooth connection between public opinion and political outcomes. During most of my life, that seemed to be the case or, at least, we imagined it to be the case. Today this is gravely in question.

  Politicians do things daily and hourly that are opposed by their constituents — fund foreign aid and wars for example — but they do it anyway due to well-organized pressure groups that operate outside public awareness. That’s true many times over with the administrative and deep layers of the state.

  In most countries, states and elites that run them operate without the consent of the governed. No one likes the surveillance and censorial state but they are growing regardless, and nothing about shifts in public opinion seem to make any difference.

  It’s surely true that there comes a point when state managers pull back on their schemes for fear of public backlash but when that happens or where, or when and how, wholly depends on the circumstances of time and place.

  Second, the Overton window presumes there’s something organic about the way the window is shaped and moves. That is probably not entirely true either. Revelations of our own time show just how involved are major state actors in media and tech, even to the point of dictating the structure and parameters of opinions held in the public, all in the interest of controlling the culture of belief in the population.

  I had read Manufacturing Consent by Noam Chomsky and Edward Herman when it came out in 1988 and found it compelling. It was entirely believable that deep ruling-class interests were more involved than we know about what we are supposed to think about foreign-policy matters and national emergencies, and, further, entirely plausible that major media outlets would reflect these views as a matter of seeking to fit in and ride the wave of change.

  What I had not understood was just how far-reaching this effort to manufacture consent is in real life.

  What illustrates this perfectly has been media and censorship over the pandemic years in which nearly all official channels of opinion have very strictly reflected and enforced the cranky views of a tiny elite. Honestly, how many actual people in the U.S. were behind the lockdowns policy in terms of theory and action? Probably fewer than 1,000. Probably closer to 100.

  But thanks to the work of the Censorship Industrial Complex, an industry built of dozens of agencies and thousands of third-party cutouts including universities, we were led to believe that lockdowns and closures were just the way things are done. Vast amounts of the propaganda we endured was top down and wholly manufactured.

  Third, the lockdown experience demonstrates that there is nothing necessarily slow and evolutionary about the movement of the window. In February 2020, mainstream public health was warning against travel restrictions, quarantines, business closures and the stigmatization of the sick. A mere 30 days later, all these policies became acceptable and even mandatory belief.

  Not even Orwell imagined such a dramatic and sudden shift was possible!

  The window didn’t just move. It dramatically shifted from one side of the room to the other, with all the top players against saying the right thing at the right time, and then finding themselves in the awkward position of having to publicly contradict what they had said only weeks earlier.

  The excuse was that “the science changed” but that is completely untrue and an obvious cover for what was really just a craven attempt to chase what the powerful were saying and doing.

  It was the same with the vaccine, which major media voices opposed so long as Trump was president and then favored once the election was declared for Biden. Are we really supposed to believe that this massive switch came about because of some mystical window shift or does the change have a more direct explanation?

  Fourth, the entire model is wildly presumptuous. It is built by intuition, not data, of course. And it presumes that we can know the parameters of its existence and manage how it is gradually manipulated over time.

  None of this is true. In the end, an agenda based on acting on this supposed window involves deferring to the intuitions of some manager who decides that this or that statement or agenda is “good optics” or “bad optics,” to deploy the fashionable language of our time.

  The right response to all such claims is: You don’t know that. You are only pretending to know but you don’t actually know. What your seemingly perfect discernment of strategy is really about concerns your own personal taste for the fight, for controversy, for argument, and your willingness to stand up publicly for a principle you believe will very likely run counter to elite priorities. That’s perfectly fine, but don’t mask your taste for public engagement in the garb of fake management theory.

  It’s precisely for this reason that so many intellectuals and institutions stayed completely silent during lockdowns when everyone was being treated so brutally by public health. Many people knew the truth — that everyone would get this bug, most would shake it off just fine and then it would become endemic — but were simply afraid to say it. Cite the Overton window all you want but what is really at issue is one’s willingness to exercise moral courage.

  The relationship between public opinion, cultural feeling and state policy has always been complex, opaque and beyond the capacity of empirical methods to model. It’s for this reason that there is such a vast literature on social change.

  We live in times in which most of what we thought we knew about the strategies for social and political change have been blown up. That’s simply because the normal world we knew only five years ago — or thought we knew — no longer exists. Everything is broken, including whatever imaginings we had about the existence of this Overton window.

  What to do about it? I would suggest a simple answer.

  Forget the model, which might be completely misconstrued in any case. Just say what is true, with sincerity, without malice, without convoluted hopes of manipulating others. It’s a time for truth, which earns trust.

  Only that will blow the window wide open and finally demolish it forever.

  Tyler Durden
  Sun, 05/05/2024 – 16:20

• Cognitive Decline: Biden Campaign Says They Will Shorten His Speeches
  Cognitive Decline: Biden Campaign Says They Will Shorten His Speeches

  Who is actually running the country?

  The Biden campaign team has admitted that they are seeking to shorten his speeches, claiming that they are seeking “quality over quantity,” but leading many to presume it is because he can barely talk.

  

  Modernity.news’ Steve Watson reports that Biden Deputy Campaign manager Quentin Fulks told MSBNC:

  “Our campaign believes in quality over quantity. We believe that these touches, these smaller things that are getting to the point about what is going on in the stakes of this election are gonna be easier for the voters to tap into.”

  NBC reports Biden’s handlers are “looking to shorten his speeches” to limit his public displays of cognitive decline.

  A Biden campaign spokesman insists it’s about “quality over quantity.” pic.twitter.com/GreyaVbgN6

  — RNC Research (@RNCResearch) May 4, 2024

  The announcement led many to ask, how much shorter can his speeches get?

  Is that..possible?

  I suppose they can just have him show up, smile, crap his pants and leave.

  — JD Sharp (@imjdsharp) May 4, 2024

  Prediction: biden’s speeches will be two words within the next month….. Hi. Bye.

  — I put my faith in God, not the government (@DontBidenMe) May 4, 2024

  At the moment he can barely manage three minutes without slurring and losing a battle with the teleprompter.

  I guess they can’t shorten his responses in press conferences since he hardly gives any.

  — Kelkat (@Tweetytweeter63) May 4, 2024

  Who’s actually running the country?

  👀 👀 👀

  — iNeo_G 🚀 💫 ✨ (@iNeo_G) May 4, 2024

  The campaign like to air pre recorded speeches, that have scores of edits and cuts in them, blatantly because he struggles to speak more than one sentence at a time.

  And when Biden goes off script, he does something idiotic like calling Japan a Xenophobic country:

  They are already hiding him from the press after failing to disguise that he can barely walk.

  Probably because when he does encounter the press, he freezes and looks like he’s crapping himself:

  Joe Biden is falling apart in front of our very eyes! They can hide him all they want but the people know he’s more than unfit to serve! https://t.co/RVjzPJoTma

  — Tex-Mex Trumpian (@TexicanTrumpian) May 4, 2024

  Is it any wonder he is less popular than any other president in modern history:

  *  * *

  Your support is crucial in helping us defeat mass censorship. Please consider donating via Locals or check out our unique merch. Follow us on X @ModernityNews.

  Tyler Durden
  Sun, 05/05/2024 – 15:45

• US Covert Missile Launcher Touted As Game Changer In Future Taiwan War
  US Covert Missile Launcher Touted As Game Changer In Future Taiwan War

  Authored by Kyle Anzalone via AntiWar.com,

  After the US withdrew from a major nuclear arms treaty with Russia in 2019, the Pentagon began to develop weapons that would have violated that agreement. Such a covert missile has now been deployed to the Philippines as part of the US military buildup surrounding China. The New York Times reports this system to be a covert missile launcher that Washington believes could jeopardize Xi Jinping’s position as president of China.

  Capable of firing Tomahawks and other munitions, the Typhon launcher is concealed in a 40-foot shipping container and can hold up to four missiles. The Defense Department first deployed the launchers to the Philippines during war games late last month, after which China accused the US of “stoking military confrontation.”

  

  According to the Times, Washington hopes to use the Typhon launchers to protect Taiwan from a Chinese attack. Sources who spoke with the outlet believe that Typhon’s strike power is enough to thwart an invasion of Taiwan and even force Xi from power in Beijing if an invasion fails.

  Below is a section of the NYT report which sets a dramatic scene:

  Setting squadrons of Chinese amphibious ships packed with troops ablaze in the Taiwan Strait, Pentagon officials believed, would not only protect the de facto independent island but may also make Mr. Xi’s own grip on power within the Communist Party untenable.

  Without the legal restrictions of the I.N.F. Treaty, the Pentagon began experimenting with existing assets.

  The Typhon launcher would have been banned under the Intermediate-Range Nuclear Forces Treaty (INF). Signed near the end of the Cold War, the treaty outlawed land-based missiles and launchers with a range between 500 and 5,500 kilometers.

  Tomahawks have carried nuclear payloads in the past, although the US retired that variant of the missile in compliance with the INF Treaty.

  The Times’ Pentagon reporter also notes that the Typhon system could be deployed to the southwestern Philippines for a potential conflict in the South China Sea. Tensions between Beijing and Manila have been rising for several months over dueling claims about sovereignty over reefs in the sea.

  The White House has reaffirmed its mutual defense pact with the Philippines, suggesting the Biden administration is ready to go to war with China over territorial claims in the South China Sea.

  Washington and Manila are additionally working on an intelligence-sharing agreement that is expected to be finalized this year. This pact, and a raft of other partnerships Washington has formed in the Indo-Pacific, are aimed at fighting a future war with Beijing.

  Tyler Durden
  Sun, 05/05/2024 – 15:10

• Biden Boosts Student Dem Leader Warning Of "Dictator Trump" On PBS
  Biden Boosts Student Dem Leader Warning Of “Dictator Trump” On PBS

  Days after OnlyFans & TikTok star Farha Khalidi revealed the Biden administration paid her to push “full-on political propaganda” while asking her not to disclose that she was part of a covert propaganda strategy, the Biden-Harris campaign reposted on X a video of Gen-Zers regurgitating Democrat talking points, such as ‘Trump is a threat to Democracy.’ 

  The PBS News Hour roundtable discussion with Michigan students appeared loaded and staged. The left-wing media outlet tried to create the vibe that Gen-Zers are voting for President Biden in November because they’re afraid of losing Democracy if former President Trump is reelected.

  This is yet another example of Democrats brainwashing the youth into believing the biggest threat to America right now is the reelection of Trump. Under Biden, in just a few short years, the administration facilitated the greatest illegal alien invasion this nation has ever seen, now risking a major national security threat as unvetted migrants roam the nation, causing crime and chaos. Then there’s horrendous foreign policy in Eastern Europe and the Middle East, which risks pushing the world closer to World War III. Yet these kids, infected with the woke mind virus, are having trouble seeing reality. 

  Biden-Harris campaign reposted the video on X, saying, “Gen Z voter: The biggest issue for me is Democracy. We saw January 6. Now Trump is admitting he’ll be a dictator on day one. That’s not just rhetoric, that’s an admission.” 

  Gen Z voter: The biggest issue for me is democracy. We saw January 6. Now Trump is admitting he’ll be a dictator on day one. That’s not just rhetoric, that’s an admission pic.twitter.com/JxkQbLgcNa

  — Biden-Harris HQ (@BidenHQ) May 3, 2024

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  However, as X users pointed out, how can there be a fair and balanced discussion when the Gen-Zer speaking in the video is the co-chair of College Democrats at the University of Michigan? 

  

  Here’s what others said: 

  Lol staged with paid actors

  — Shawn spelled the right way (@ShawnsBrain) May 3, 2024

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

  Right, because a bunch of teenagers who struggle with gender identity are exactly the type of people we should be listening to lmfao

  — Heywood Jablome (@SeanSeneca30103) May 3, 2024

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  Not sure how 4 students represent all Gen Z voters but go on.

  — This too shall pass (@coolname77) May 4, 2024

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  I hope the boys are ready to be drafted for world war 3

  — Tammy (@Tammy8156) May 5, 2024

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  So why would the Biden-Harris campaign be focused on attempting to deceive youngsters into believing the cool thing in November is to vote for someone who could honestly be their elderly grandpa in a retirement home? 

  

  The reason is straightforward. A recent Bloomberg News/Morning Consult poll found that Trump leads Biden 47% to 40% among voters 18-34 in swing states. This is a significant shift from the last presidential cycle when Biden won 61% of voters under 30. 

  The Biden administration understands they desperately need Gen-Z and millennial support to win in November, hence why they were paying at least one OnlyFans creator to spew propaganda. And why they pushed for an illegal alien invasion. 

  Meanwhile, youngsters are coming to age in one of the worst economic periods this nation has seen in a generation. Elevated inflation is crushing household finances. Thanks to Fed chair Powell & out-of-control fiscal spending by Democrats. 

  Youngsters are pissed about disastrous Bidenomics. 

  The struggle is real for the new generation, which is just now learning that working a 9-5 isn’t as easy as college. pic.twitter.com/FvAeYkTddt

  — Ian Miles Cheong (@stillgray) October 25, 2023

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  A lot of people seem to think this mindset is unique to Gen Z. It’s not.

  Every generation goes through this. Watch Reality Bites, where a group of 20-somethings in the early 90s deal with the exact same struggles and emotions as described in this video.

  pic.twitter.com/7h1gAN3c7R

  — Matthew Kobach 🍕 (@mkobach) October 20, 2023

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

  The Gen-Z girl who complained about the 9-5 work schedule has a comment for Business Insider (which tried to find out where she works) about the stress of finding a job as a post-grad. She’s got a point. pic.twitter.com/4ExfWrELLF

  — Ian Miles Cheong (@stillgray) October 27, 2023

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

  Plus, on campus – there’s been a surge in Gen-Zers stepping up to protect the flag and the nation against Marxist radicals. 

  The average 20-year-old boy on a big state college campus is a lot closer to the picture on the right than the picture on the left. https://t.co/6wI7LSl31Y pic.twitter.com/yx52F01kNY

  — Nate Hochman (@njhochman) May 4, 2024

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  We’ll leave you with this. 

  Here are some more Gen Z voters.

  How about you post these ones 🤨 pic.twitter.com/HgBN490Evm

  — Rob Coates 🇺🇸 (@LuckyHippie926) May 3, 2024

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  Biden camp is in trouble. 

  Tyler Durden
  Sun, 05/05/2024 – 14:35

• Change Of S&P Leadership Suggests Bottom Is Near
  Change Of S&P Leadership Suggests Bottom Is Near

  Authored by Simon White, Bloomberg macro strategist,

  A change in sector leadership in US stocks suggests the correction might soon be over and a bottom is not too far away.

  The tech sector has led the recent advance in the US stock-market (i.e. the sector with the highest three-month return on a three-month smoothed basis), but in the last two weeks it lost that mantle to the communication services sector.

  (Tech stocks are leading today after the payrolls miss, but on a three-month return on a three-month smoothed basis communication services are still ahead.)

  

  As the chart shows, the two previous market corrections were accompanied by a change of leadership. But that change came near the bottom and ahead of the next advance.

  The tech sector is lagging as its main constituents, Microsoft, Apple and Nvidia, have been lagging, while the communication services sector, predominately Meta and Google, went into the lead, driven the latter’s positive earnings surprise last week.

  Further confidence that the current fall in prices is just a correction is given by buoyant excess liquidity that continues to be supportive for stocks and relatively low near-term recession risk (although that is always subject to changes based on the data).

  

  Also the primary bull trend in the stock market remains intact. The 13 versus 26-week moving average crossover signal for the S&P was one of the earliest signs that the market’s nascent advance in early 2023 was durable. The positive stock-market regime that began late last year remains in place.

  Tyler Durden
  Sun, 05/05/2024 – 14:00

• "Nothing Wrong With Being Hamas": Radical Leftist Groups Trained Students Before Nationwide Campus Chaos 
  “Nothing Wrong With Being Hamas”: Radical Leftist Groups Trained Students Before Nationwide Campus Chaos 

  It’s very puzzling that the purple-haired communist revolutionaries sitting in tents across woke colleges and universities nationwide would advocate for Palestinians to break free from the support of freedom-loving Israel only to adopt the authoritarian control of Sharia law by Hamas. But perhaps, as we’ve explained before, the uprisings at colleges have very little to do with helping poor Palestinians and everything to do with abolishing capitalism and the socialist reconstruction of America. 

  In the last several weeks, social unrest has been spreading like stage 4 cancer across college campuses nationwide. These uprisings have likely been influenced by Marxist groups grooming kids, infecting them with the woke mind virus (in this case, oppressor vs. oppressed). Really, how can these kids be oppressed if they’re attending elite schools, living the dream on taxpayer-funded student loans while getting worthless gender studies degrees? Meanwhile, the vast majority of Americans are struggling to pay bills and put food on the table in the era of failed Bidenomics as inflation runs rampant.  

  Like many law-abiding Americans watching the protests, we spotted similarities with demonstrators at multiple colleges and universities, including the same-style tent and white construction worker helmets being utilized by demonstrators.

  

  Also, professional protesters showed up… 

  

  This began the questioning of just how organized and funded these protests were. 

  Professional agitators arrested at Columbia College campus.

  Unveiling a Pattern of Disruption

  Recent arrests at Columbia College campus in NYC have brought to light the activities of anarchists, revealing a concerning pattern of unlawful protest actions. These arrests,… pic.twitter.com/xqjoHp96Jx

  — Viral News NYC (@ViralNewsNYC) May 5, 2024

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  To answer that question, the Wall Street Journal, published a new report that reveals the social unrest at colleges and universities was the result of a multi-month “training and planning” campaign by “activists and left-wing groups.”

  At Columbia University, student organizers consulted heavily with radical leftwing groups, such as National Students for Justice in Palestine, veterans of campus protests, and former Black Panthers, many months before the protests. 

  These campus riots have been spontaneous eruptions of support for Hamas terrorists. Luckily 500 professionally printed protest signs showed up unannounced out of nowhere! 😂 pic.twitter.com/caHr9dar1b

  — James Woods (@RealJamesWoods) May 1, 2024

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  “We took notes from our elders, engaged in dialogue with them and analyzed how the university responded to previous protests,” Sueda Polat, a graduate student and organizer in the pro-Palestinian encampment, told WSJ. She said they met with former Black Panthers about how to organizer the movement. 

  Meanwhile, the National Students for Justice in Palestine, or NSJP, with over 300 chapters across the US, was heavily involved in organizing college encampments and building takeovers. 

  These building takeovers left the nation stunned… 

  She participated in a hostile takeover of campus and subjected her classmates to “Zionist” purity checkpoints that determined whether or not they got to access their classes.

  Her group vandalized and barricaded historic buildings and treated anyone not w/them as enemies.

  They… pic.twitter.com/R71cXZvfFZ

  — Mark Schipper (@TheMarkSchipper) May 3, 2024

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  🇺🇸🇵🇸 MORE FOOTAGE OF THE PRO-PALESTINIAN TAKEOVER OF CAL-POLY

  Riot police are attempting to regain control of the campus after protesters barricaded themselves within the campus of California’s Polytechnic University.

  Decisive action is called for as more universities around… https://t.co/d8VIvhuY2C pic.twitter.com/dLxXLIY2ci

  — Mario Nawfal (@MarioNawfal) April 23, 2024

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  Royce Hall is the most iconic building on the UCLA campus. I spent a lot of time there in college.

  Look at what these supporters of Hamas terrorists did to my school, and tell me again how peaceful this protest is. pic.twitter.com/Ci7YEDvAwF

  — Joel M. Petlin (@Joelmpetlin) May 2, 2024

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  Protesters that were Arrested last week at Columbia University in New York City had, for several Weeks and Months prior to the Establishment of the Campus Encampment as well as the Storming and Barricading of the Hamilton Hall Building, held discussions with Outside Extremists… pic.twitter.com/oBTvUOI55B

  — OSINTdefender (@sentdefender) May 5, 2024

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  As early as November, we pointed out how NSJP was beginning to cause chaos across school campuses:

  • Brandeis University Bans Students For Justice In Palestine, Alleges Hamas Support

  And…

  • Virulent Antisemitism And The Rot At Our Universities
  • Berkeley Instructor Offers Extra Credit For Attending Pro-Palestine Protest

  WSJ pointed out, “NSJP have been received and administered by the Wespac Foundation.” 

  According to Mike Gonzalez, a senior fellow at the Heritage Foundation, in a recent Washington Examiner op-ed, Wespac’s website has a photo of activists holding up a sign that reads “Another World is Possible.” He said this slogan is well-known and used by organizations that “despise capitalism but feel they must cloak their communism.” 

  “WESPAC funds various revolutionary far-left/anti-Western groups,” Ryan Mauro of Capital Research Center, who tracks these activists groups, told Gonzalez. 

  Mauro told Gonzalez that WESPAC donations include monies from Rockefeller Philanthropy Advisors and George Soros’s Open Society. 

  

  Back to WSJ’s report, weeks before the college protests erupted, students at Colombia University were given “Resistance 101” training with activists from Samidoun. 

  “There is nothing wrong with being a member of Hamas, being a leader of Hamas, being a fighter in Hamas,” Samidoun coordinator Charlotte Kates told university students. 

  Meanwhile, the Israeli government declared Samidoun a terrorist organization in 2021.

  “They support terrorism, and they want to gain public opinion — support — for terrorism,” Yossi Kuperwasser, the former chief of the research division in the Israel Defense Forces’ military intelligence unit, recently said. 

  ActiveFence Research sheds more color on Samidoun: 

  

  

  

  

  

  

  What’s taking shape here is yet another Marxist movement, or perhaps ‘BLM-style 2.0’ emerging ahead of the summer months. These Marxists, like parasites, are hijacking the pro-Palestinian movement with their intent to destroy capitalism and America. 

  Robert Pape, a political scientist at the University of Chicago who studies political violence, warned that protests are expected to continue through summer and fall.  

  Just remember, Marxists at these colleges said the quiet part out loud last week. 

  An extremist on the mic says: “There’s only one solution, intifada revolution. We must have a revolution so we can have a socialist reconstruction of the USA.”

  This isn’t just about Israel/Palestine. It’s an attempt of the Marxist takeover of America. Our colleges have become… pic.twitter.com/2IEqRyuorB

  — A Man Of Memes (@RickyDoggin) April 30, 2024

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  In April, Samidoun and other groups unleashed protests that attempted to shutter airport terminals, bridges, and highways nationwide. These protests masqueraded as pro-Palestinian demonstrations, but their dark intentions by Marxists were to disrupt the economy.  

  We asked in April: “Who Is Funding This Chaos? Pro-Palestinian Protesters Attempt To Paralyze Chicago O’Hare, Golden Gate Bridge.”

  So where are the FBI, Congress, and the Biden administration? Why aren’t they investigating these left-wing artificial protests before they spark out of control and cause more chaos across the nation?

  Caption this 👇 pic.twitter.com/HxDdS0Zpny

  — wilder😎🇺🇸 (@wilderpatriot) May 4, 2024

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  However, this time around, unlike the BLM riots several years ago, there are more than ten million unvetted illegal aliens from around the world, some of whom do not like the US. The nation is on the brink of chaos if this continues. Yet, Democrats are mostly silent. 

  Tyler Durden
  Sun, 05/05/2024 – 13:25

• Watch: Senator Eviscerates Biden Official Over "Dark Money Meetings"
  Watch: Senator Eviscerates Biden Official Over “Dark Money Meetings”

  Authored by Steve Watson via Modernity.news,

  During a Senate Energy and National Resources Committee hearing this week, Republican Senator Josh Hawley exposed a Biden official as having no clue what is going on in her own department.

  

  Hawley grilled Secretary of the Interior Deb Haaland regarding alleged shady meetings with foreign “dark-money groups” that actively fund radical left-wing environmental initiatives. 

  “Is it common practice at your department to meet with dark money groups off the books and conceal it from the public?” Hawley probed.

  Talk about corruption: Biden’s Interior department has *off the books* meeting with liberal dark money group funded by foreign billionaire, conceals it from the public, then does everything they want. In this case, canceling critical mining in the US. To benefit China. pic.twitter.com/tfQeEXq1f3

  — Josh Hawley (@HawleyMO) May 2, 2024

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  Haaland Replied “Senator, thank you for the question, and of course, I can’t answer to, uh, if you’re referring to our former deputy secretary. He’s no longer at the department.”

  “Who worked for you,” Hawley fired back.

  “He worked for the president. He was appointed by the president,” Haaland said, attempting to to deflect responsibility.

  “He’s your deputy secretary,” Hawley said, adding “Are you the secretary of the Department of the Interior? I thought that’s why you were here.”

  Hawley then asked “Are you the secretary?” Scolding Haarland for attempting to look to colleagues for assistance. 

  “Don’t look at her, look at me. Are you the secretary?” he repeated.

  “I am,” Haaland responded.

  Hawley further asked “Do these people who are sitting here today answering most of your questions, do they work for you? Do they report for you? You’re not in charge?”

  “They work with me,” Haaland answered.

  “They work with you. So you’re not in charge of the department?” An exasperated Hawley asserted, adding “Oh my gosh, I thought you were in charge! I thought that was why you were here!”

  “We work as a team,” Haaland responded, 

  “Oh, okay. So who’s in charge then?” Hawley demanded.

  Secretary Haaland apparently doesn’t know who’s in charge of the Interior Department. Hint: it’s supposed to be her 👇 pic.twitter.com/c1BSXtiViW

  — Josh Hawley (@HawleyMO) May 2, 2024

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  “Uh, I, I provide the vision, I provide the overall direction and —” Haaland stuttered. 

  “But you’re not in charge,” Hawley proclaimed, asking “Do you take responsibility for what happens at the Department of the Interior?”

  “I take responsibility,” Haaland said.

  “Good, then why are your leadership meeting with dark money groups and concealing it from the public? Why are they doing it off the books? How many times did this happen?” Hawley asked, returning to the original question. 

  “Senator, this is the first I’m hearing of this,” Haaland claimed, adding “I don’t, I didn’t … my deputy secretary is no longer there, and, um, I can’t answer to what he did when he was there.”

  Hawley again accused Haaland of refusing to take responsibility again, and charging that Haaland’s Department has “a corruption problem.”

  “We have foreign billionaires, who are funding dark-money groups, coming to meet with your leadership, concealing it from the public, while they are filing lawsuits adverse to the department,” Hawley urged, concluding “The American people should be charge—not the foreign billionaires.”

  The full exchange is below:

  *  *  *

  Your support is crucial in helping us defeat mass censorship. Please consider donating via Locals or check out our unique merch. Follow us on X @ModernityNews.

  Tyler Durden
  Sun, 05/05/2024 – 12:50

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