Today’s News 7th June 2024

• Russia Says It Continues To Cut Oil Production Under OPEC+ Deal
  Russia Says It Continues To Cut Oil Production Under OPEC+ Deal

  By Charles Kennedy of OilPrice.com

  

  Russia continued to cut its oil production in May per the OPEC+ agreements, Russian Deputy Prime Minister Alexander Novak said on Thursday, in another attempt to reassure the market that OPEC+ producers are committed to the pact and to stabilizing the oil market.  

  “Our reduction against April continued in accordance with our OPEC+ agreements,” Novak told reporters on the sidelines of the St. Petersburg International Economic Forum, as quoted by Russian news agency TASS.

  Asked about exact numbers for the May oil production, Novak said that the scale of the output cut would become clear in about a week. 

  When the OPEC+ members announced in early March their intentions to extend the cuts into the second quarter, Russia changed its production/export cut plan and said that it would reduce supply by 471,000 bpd in the second quarter in the form of cuts to oil production and exports.

  In April, Russia pledged to reduce production by 350,000 bpd and exports by 121,000 bpd. In May, the 471,000 bpd reduction would be in the form of a 400,000-bpd cut to production and 71,000 bpd cut to exports, and in June the Russian supply cut would be 471,000 bpd entirely from production reductions.

  Output cuts were to account for most of the extra Russian supply cut this quarter, and they could be the result of reduced refining capacity with maintenance in Q2 and refinery rates estimated to have slumped due to Ukrainian drone attacks on Russian refineries. 

  Last month, Russia said that it had “slightly exceeded” in April its oil output target under the OPEC+ pact and that it would compensate for the overproduction.

  The Russian Energy Ministry said in a statement that the overproduction in April was “due to technical difficulties of cutting production in a large amount.”

  “Russia is fully committed to the OPEC+ agreements, plans to compensate for shortfalls in production plans, and will soon submit to the OPEC Secretariat its plan to offset small variations from voluntary production levels,” the ministry said at the end of May.

  Tyler Durden
  Fri, 06/07/2024 – 02:00

• How Bob Iger, DEI, And Wokism Broke Disney's Trust With America
  How Bob Iger, DEI, And Wokism Broke Disney’s Trust With America

  Authored by Richard Truesdell via American Greatness,

  There is something of a subculture on YouTube of armchair analysts and commentators, WDW Pro, Valliant Renegade, and ClownfishTV, to name just three (beyond traditional financial websites like CNBC and Seeking Alpha), who track every cultural, corporate, programming, and financial move of The Walt Disney Company, previously one of America’s most iconic and trusted companies.

  Note: I used the past tense in describing The Walt Disney Company.

  It is no longer one of America’s most trusted brands, and it’s about to lose its iconic status.

  

  How did this happen?

  On May 7, 2024, in the wake of its successful battle to keep activist investor Nelson Peltz off its Board of Directors back in April (after which Peltz liquidated his Disney holdings, walking away with more than $1 billion), Disney CEO Bob Iger held Disney’s quarterly earnings call, during which its stock tanked almost 10%, losing $20 billion in its market cap. While it has recovered a bit, to $105 a share, it’s well below its 52-week high, $123.72, and off its all-time highest closing price of $201.91 on March 8, 2021. Those investors who abandoned Peltz in his proxy battle for two seats on the Disney Board of Directors can now lick their financial wounds.

  There is speculation in the financial community that if Disney stock again falls below $90 a share, Peltz could mount a third bid for two or more seats on the Disney board or possibly oust Iger. It’s hilarious to watch the New York Times put its spin on the battle, saying Peltz lost his battle with Iger. Actually, Peltz and his Trian Partners investment group walked away with $1 billion. Yes, Peltz lost the battle, but he won the war.

  Despite the current dip, many stock analysts are predicting that Disney stock will rebound. That seems unlikely. Here are the reasons why things are likely to get worse, not better, for The Walt Disney Company for the remainder of 2024 and into 2025.

  Disney is one of America’s wokest companies. It sees itself as being out in front on cultural and social issues, especially where Diversity, Equity, and Inclusion are concerned. This has been a huge issue in America’s—especially American parents’—loss of trust in the House of Mouse. You can’t watch this clip from Disney programming Vice President Latoya Raveneau bragging about how she pushed LGBTQ messages anywhere she could into Disney’s programming without parents seeing that agenda. Because of this agenda, Disney parks, Disney feature films, Disney animation, and especially the Disney Channel have lost trust with many parents.

  Disney has lost its decades-long leadership in animation to NBCUniversal’s Dreamworks Animation studio. Its slate of feature films—with their bloated $250,000,000 production budgets requiring a $500,000,000 theatrical run to just break even—has been an unmitigated disaster. Along the way, it has destroyed two of the successful film franchises it acquired during Iger’s first term as CEO: Star Wars and Indiana Jones. And its long-delayed live-action remake of its own 1937 Snow White classic animated film is mired in its own disaster, mostly due to woke comments from its star, Rachel Ziegler. It was moved back a year from a March 2024 release to 2025. But could its theatrical release be scrapped entirely and go directly to the Disney+ streaming service?

  Related to its film franchises, which also include Marvel and Pixar (which just laid off 175 employees), was the company’s $250,000,000 misadventure, Star Wars: Galactic Starcruiser, a $6,000 two-night Star Wars-themed hotel experience that opened on March 1, 2022, and closed on September 30, 2023. It was forced to take a charge against earnings for this catastrophe. This disaster was documented in a four-hour viral video by YouTuber Jenny Nicholson that has received an incredible seven million views in a little more than two weeks. (That was 10 times the number of views CNN’s coverage of the debacle received.)

  On top of its injection of its left-wing DEI agenda, Disney has more nuts-and-bolts financial issues to contend with.

  They include:

  Theme park attendance is flatlining. What is the measurement matrix? Waiting times at the most popular attractions at its theme parks, Disney World in Florida and Disneyland in California, are plummeting. Over the all-important Memorial Day 2024 weekend, waiting times at the most popular attractions at both theme parks were at decade lows (with the exception of during COVID-19). In addition, its newest attraction at Walt Disney World in Florida, Tiana’s Bayou Adventure, which replaced Splash Mountain, has been panned by the Disney faithful. This review is typical.

  Then there’s Disney’s forced acquisition of the share of the Hulu streaming service it didn’t own (it shared ownership with Comcast), which has been an utter disaster for the company. (As of today’s date, the parties have yet to come to a final agreement on the value of Hulu.) Disney was forced to buy out Comcast’s share, and it is struggling to integrate Hulu into its Disney+ streaming service. This forced payout is now funding Comcast so that it can bid for sporting rights for entities like its recently concluded agreement with NASCAR and the upcoming agreement with the NBA. Both are in direct competition with one the last of Disney’s crown jewels, ESPN. The sports network is trying to reinvent itself as content distribution moves from cable to streaming. Last July it laid off dozens of employees, including high-profile names like Suzy Kolber, Jeff Van Gundy, Jalen Rose, and Steve Young, in what was a cost-cutting move.

  Disney is no longer American parents’ babysitter. Here’s one parent’s open letter to Disney.

  I say all this as a baby boomer who grew up with Disney in the 1950s and 1960s (that will give you an idea of how old I am). Disney’s current values are no longer those of its namesake founder, Walt Disney. Parents, especially those in the center and on the right, that are trying to raise their kids with the traditional values that made America great in the last century, no longer trust the House of Mouse. And until there is housecleaning, starting at the top of the C-suite, Disney will not be trusted again.

  Putting ideology ahead of entertainment has decimated an American institution. Walt Disney has been spinning in his grave ever since Bob Iger first became CEO back in 2005 during his first term. It continued during the short reign of Bob Chapek from 2020 to 2021, then accelerated at warp speed after Iger returned to the CEO role in 2022, post-COVID. The Walt Disney Company is broken, and until it gets new leadership at the top and refocuses on its core mission, to entertain, it is headed in only one direction: down. And that’s a shame for baby boomers like me who grew up with Walt Disney when our parents could trust the company to deliver wholesome entertainment not tainted by an agenda or ideology.

  Tyler Durden
  Thu, 06/06/2024 – 23:30

• False Flag On The Horizon? The Strange Case Of The Destroyed Russian Nuclear Radar
  False Flag On The Horizon? The Strange Case Of The Destroyed Russian Nuclear Radar

  Authored by Brandon Smith via Alt-Market.us,

  If we accept the fundamental truth that Ukraine is nothing more than a proxy battleground between Russia and the west, then you might say WWIII has already begun. The powers-that-be have been content to keep the situation contained primarily to Ukraine so far, but a recent event suggests things are about to change. There’s something very strange happening on the nuclear front between NATO and Russia and I believe it might be time to consider the possibility that a false flag threat is in the works.

  

  In the past two weeks Ukraine has taken credit for at least two separate strikes on peculiar targets – Russian “over the horizon” radar stations using drones with an impressive flight range of at least 1200 miles. Until this point, long range attacks into Russian territory have been exceedingly rare. So, why these specifics radar stations?

  The Voronezh-DM stations were positioned outside the city of Orsk and the region of Krasnodar (Armavir); far away from the front lines in Ukraine. The strikes are being hailed as the furthest Ukraine has attacked into the heart of Russia, but the corporate media has ignored the wider implications of the situation.

  It is likely that the drones used were of US or European origin. NATO has (until the past couple of days) enforced tight restrictions on how their weapons can be used by Ukraine. Long range drones and cruise missiles hitting targets deep in Russia invites major blowback, including the threat of a nuclear response.

  That said, it’s not so much the weapons used that concerns me, it’s the specific targets that Ukraine supposedly chose.

  Russia’s over-the-horizon radar systems have a detection range of at least 6000 miles (the real range is classified) and scan specifically for high altitude ballistic missiles. They are not designed to detect lower flying medium range cruise missiles (ATACMS) and drones. Meaning, the two stations destroyed by Ukrainian weapons are meant to act as an early warning system for nuclear attack.

  The Ukrainians supposedly defied NATO restrictions, not once, but twice, to target radar systems that have nothing to do with them. In fact, the arrays sit in permanently fixed positions and neither array was actually aimed at Ukraine, they were aimed to the North and Southwest of Russia. The Armavir radar was constructed in 2009 to close a gap created by the loss of radars in Ukraine, and was also meant to replace an older Daryal radar in Gabala. Interestingly, Armavir and Orsk “search fans” watches the skies primarily above the Middle East, including Israel, and a large chunk of Europe including Switzerland.

  

  Instead of attacking vital strategic resources like oil refineries or ammo depots, Russia’s nuclear defenses are being systematically hobbled. Why?

  It’s important to understand that a strike of this kind deep into the center of Russia requires complex planning and logistics. It cannot be achieved without covert intel on the ground as well as aid from satellite surveillance. Ukraine relies completely on NATO satellites and intel; no such strike would ever be possible without NATO involvement. Furthermore, the drones used would need to have the ability to evade early detection systems and remain hidden for thousands of miles. This kind of technology comes mainly from the west.

  In other words, there’s no way that these attacks were accomplished by Ukraine without extensive help and approval from the US or European command. I question the notion that a Ukrainian pilot was even remotely flying the drones. We’re talking about some of the most closely defended radar stations in the whole of Russia.

  Why does any of this matter?

  Let’s consider the ugly realities…

  First, the targeting of Russian nuclear defenses might make the Kremlin believe they are being prepped for a nuclear strike. Why else would their ballistic radar be singled out? This means they will be on high alert for a possible nuclear exchange. Not good.

  Second, the Voronezh-DM stations are used to identify FALSE POSITIVE alerts of nuclear attack. Meaning, if there a weapon is used against Russia that mimics a high altitude ballistic missile, their ability to detect that it’s NOT a nuke has been reduced. They might launch their own warheads in response to a non-nuclear strike (a fake strike or false flag).

  Third, Armavir and other stations could be used to record ballistic missile activity well outside Russian air space (in places like the Middle East). It’s possible these strikes were meant to blind Russia and stop them from detecting missile events that are unrelated to the Ukraine war.

  Fourth, it’s possible that NATO and Ukraine believe dismantling the radar sends a message that if Russia threatens nuclear attack, they might be hit first. All this means is that Russia won’t give a warning, they’ll simply launch.

  Fifth, the attack on Armavir alone meets the conditions the Russian government laid out publicly in 2020 for actions that could trigger a nuclear retaliatory strike. Russia’s early warning network is part of the country’s broader nuclear deterrent posture.

  “The conditions specifying the possibility of nuclear weapons use by the Russian Federation” include any “attack by an adversary against critical governmental or military sites of the Russian Federation, disruption of which would undermine nuclear forces response actions,” according to the Basic Principles of State Policy of the Russian Federation on Nuclear Deterrence the Kremlin published in 2020.

  So far there has been no indication on how Russia will retaliate, but let’s consider the circumstances at the front right now. Ukrainian defenses are thin and they lack the manpower needed to maintain the most rudimentary of strong points. As I noted last month, Ukraine’s front line is about to be overrun, likely this summer, with Russia opening a new offensive push in the north near Kharkiv.

  NATO countries are now say they support Ukraine’s use of long range weapons inside Russia. This means major metropolitan areas of Ukraine will be on the the table for Russia’s own long range strikes, a measure which they have avoided for the most part. Also watch for the potential use of thermobaric bombs (vacuum bombs) by Russia; these are massively destructive weapons that have so far been absent from the battlefield (aside from unverified reports).

  The west is sending Russia the message that they will not allow Ukraine to lose, they will not pursue diplomatic solutions and if Russia begins gaining significant ground, anything goes. Does this include nukes? It’s hard to say.

  My suspicion is that the establishment wants to create a scenario in which Russia is led to overreact to an event, or, the public is led to believe Russia is a legitimate nuclear threat to the west. There is also the outside possibility that Russia is being blocked from monitoring a future ballistic incident in the Middle East.

  The timing of the radar attacks comes only weeks before the planned Ukraine “peace conference” in Switzerland on June 15th. Although major leaders from the US, China, and Europe will not be attending (and Russia isn’t invited), the summit is still a juicy target for a false flag and thus unification of western interests around a larger war with Russia. I’m not saying the conference itself will be attacked, necessarily, but a major attack during the conference could be used to sell the idea of total NATO intervention.

  If the goal is to expand the war then any perceived hostilities aimed at the conference could also be used as an excuse to rally popular support. The fact that so many world leaders including Biden refuse to show up makes it even more dubious.

  I highly doubt the establishment wants to trigger a global nuclear war. They have everything to lose and very little to gain. They just spent the better part of the last century building up one of the most intricate economic and political control grids in the history of humanity. I don’t think they would be happy to see it all vaporized in the blink of an eye. That said, a limited nuclear event might serve their interests well.

  As I write this multiple governments including the French government are calling for European troops to be deployed to Ukraine. Some political leaders want them to go as “advisers” and trainers. This is exactly what the US did right before it deployed extensive military forces to Vietnam. Remember the false flag Gulf of Tonkin incident?

  Something very odd is going on here. I have no doubt that WWIII is the intended outcome of the confrontation between NATO and Russia in Ukraine. The question is, how do they plan to arrange that outcome while convincing the American and European public to join the war effort? They need a serious false flag.

  *  *  *

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  Tyler Durden
  Thu, 06/06/2024 – 22:30

• Airline Industry Leaves COVID Turbulence Behind
  Airline Industry Leaves COVID Turbulence Behind

  Having left behind most Covid-related turbulences, the global airline industry emerged from the storm in 2023, returning to profitability after three years of deep losses. According to the estimate from the International Air Transport Association (IATA), commercial airlines ended 2023 with a net profit of $27.4 billion, up from a loss of $3.5 billion in 2022 and significantly higher than previously expected. Back in December, IATA had predicted 2023 profits to come in around $23 billion.

  Speaking at the IATA’s 80th Annual General Meeting in Dubai on Monday, IATA’s Director General Willie Walsh hailed the industry’s successful recovery from the pandemic, while also warning that the industry’s profit margins remain “wafer thin.”

  “We deserve to celebrate the hard work that has brought our industry back from the brink, while acknowledging that we remain squeezed between a fiercely competitive environment downstream and the oligopolistic upstream supply chain’s lack of competition,” Walsh said, adding that “onerous regulation” and persistent supply chain problems also stand in the way of sustainable industry-level profits.

  Passenger revenue is expected to reach $744 billion, exceeding the 2019 total by more than 22 percent, driven in part by an increase in in passenger volume and in part by improvements in passenger yields. Additionally, as Statista’s Felix Richter shows in the chart below, net profits are expected to climb to $30.5 billion this year, which is more than previously forecast but still not enough to build financial resilience and invest in a more sustainable future, according to Walsh.

  

  You will find more infographics at Statista

  “The airline industry is on the path to sustainable profits, but there is a big gap still to cover. A 5.7 percent return on invested capital is well below the cost of capital, which is over 9 percent. And earning just $6.14 per passenger is an indication of just how thin our profits are – barely enough for a coffee in many parts of the world.”

  Looking ahead, the IATA expects industry revenues to reach a historic high of $996 billion in 2024, as 38.7 million flights are expected for the year, just 0.2 million short of the 2019 supply.

  Tyler Durden
  Thu, 06/06/2024 – 22:00

• The Power Grid Expansion, Part 3: Investments
  The Power Grid Expansion, Part 3: Investments

  Authored by Michael Lebowitz via RealInvestmentAdvice.com,

  We continue with our discussion of investment ideas that could benefit from upgrading and expanding the power grid to accommodate surging demand from AI data centers and EVs.

  This third and final part of this series focuses on alternative energy sources, utility companies, and other companies related to the power grid infrastructure.

  If you haven’t read Parts ONE or TWO we recommend reading them before continuing.

  Alternative/Renewable Energy Sources

  In 2022, the Department of Energy calculated that renewable energy from solar, wind, hydro, geothermal, and biomass accounted for a fifth of all electricity generation. By 2028, the IEA thinks the percentage will double to 42%. Solar and wind power are expected to be the primary alternative energy sources.

  

  Investments in solar, wind, and other alternative energy sources, along with natural gas, coal, and nuclear, will be increasingly vital to power our utility plants. Furthermore, suppose the US and other nations continue to strive for net zero emissions by 2050 and other environmental goals. The demand for existing and new alternative energy sources will surge in that case.   

  

  Renewable energy has benefits and flaws compared to natural gas. The significant advantage of renewable energy is it produces minimal greenhouse gas emissions, as shown below. Second, and equally important, according to the IEA World Energy Outlook, solar and wind energy are the cheapest renewable energy sources and cost much less than carbon-based ones.

  

  However, they have considerable flaws that need to be overcome. Consider the following from Green Solutions.

  Relies heavily on weather conditions. When adverse weather conditions occur, renewable energy technologies like solar cells may not be as effective. For example, during periods of rain, PV panels cannot generate electricity, necessitating a shift back to traditional power sources.

  Lower efficiency. Regrettably, renewable technologies generally exhibit lower efficiency compared to traditional energy conversion devices. For example, commercially available solar panels have an efficiency of about 15% to 20%. In contrast, traditional technologies utilizing coal or natural gas can achieve efficiency levels of up to 40% and 60%, respectively.

  High upfront cost. The manufacturing and installation processes for renewable energy devices, such as PV panels, can be relatively expensive. Only for installation, solar panels cost about $17,430 to $23,870 on average.

  Limited geographical region. The availability of high-quality land is limited, leading developers to urgently search for new sites. For example, in Germany, regulatory, environmental, and technical limitations significantly reduce the potentially suitable for onshore wind farms to just 2%.

  Shortages of key raw materials. This includes essential metals like nickel, copper, and rare earth metals, such as neodymium and praseodymium, which are vital for the creation of magnets used in wind turbine generators.

  Renewable Stocks Are Not Following the Narrative

  With time, we believe renewable energy will become much more efficient and hopefully be in a better position to help meet the surging needs of the nation’s utility plants. Investors do not seem as hopeful. 

  The recent narrative pushing investors to power grid-related investments has skipped past renewable stocks. The graph below shows two popular alternative energy ETFs, Invesco’s Solar ETF (TAN) and iShares Global Clean Energy ETF (ICLN). Both ETFs are well off their 2008 highs and recent peaks in late 2020. 

  

  Alternative energy stocks and diversified ETFs may be excellent investments for longer-term investors as renewable energy will be relied upon heavily. Furthermore, their stocks have not benefited from the power grid expansion narrative.

  Batteries Technology Is Vital To Renewable Energy

  Solar and wind energy are not dependable due to weather conditions. For example, the following quote from OilPrice.com:

  But while solar power has made the U.S. power-generating system greener, it has also made it more volatile, especially in the top solar market, California. 

  There, peak solar power generation coincides with the lowest residential electricity demand during the midday. When power demand begins to surge after 6 p.m., solar output begins to fade.  

  In California, for example, “on sunny spring days when there is not as much demand, electricity prices go negative and solar generation must be ‘curtailed’ or essentially, thrown away,” says the Institute for Energy Research (IER).

  Accordingly, utilities need more efficient batteries to store excess renewable energy for use during peak demand periods and when the weather isn’t conducive for electricity generation. Without more efficient batteries, undependable alternative energy sources cannot be relied upon as much as the environmental goals demand.

  Companies involved in energy storage, especially those at the forefront of producing more efficient batteries, may have significant upside. But, with unproven technology come substantial risks for investors. For instance, many new types of battery technology are in development.

  • Solid-state batteries

  • Lithium-sulfur batteries

  • Cobalt-free lithium-ion batteries

  • Sodium-ion batteries

  • Iron-air batteries

  • Zinc-based batteries

  • Graphene batteries

  Battery Diversification May Be Critical

  Even if you know which type of battery will be the winner, so to speak, you also have the arduous task of figuring out which company will be a primary producer of the battery. Unless you believe you have good insight into battery technology and the key players in the industry, we think a diversified battery ETF may provide the best investment results. Further, the large battery ETFs are also diversified, with investments in lithium and other metal producers. Unfortunately, ETFs in this space are limited.

  Global X Lithium & Battery Tech (LIT) is far and away the largest, with nearly $1.5 billion AUM. While it invests in companies with new battery technology, it also “invests in the full lithium cycle, from mining and refining the metal, through battery production.” Its top three holdings are lithium producers.

  Amplify Lithium and Battery Technology (BATT) is the second largest ETF with a mere $89 million in AUM. Like LIT, they invest in lithium producers like BHP and Albemarle.

  If you want to make investments in individual companies, Tesla (battery technologies), LG Chem, and Samsung SDI are well-positioned in the industry.

  Lithium Miners

  Assuming lithium remains a crucial component in electricity storage batteries, its miners should do well, especially given the recent decline in lithium prices and the related stocks.

  North Carolina-based Albemarle (ALB) is the world’s top lithium producer and the largest producer by market cap. It is the only lithium producer of size based in the US. Like the rest of the alternative energy sector, its stock has traded poorly recently. However, with a forward P/E of 16, there is value if its revenues continue upward at their recent pace.

  

  We caution you that lithium deposits are being actively explored. Assuming success, the lithium supply may limit the price appreciation of lithium. As an example from The Hill- Researchers make massive lithium discovery in Pennsylvania.

  Utility and Grid Operators

  Utilities will generate more power, thus increasing their revenue. However, they must invest significant capital to modernize, expand, and reduce greenhouse emissions.

  AI data center locations are partially chosen based on their ability to source cheap electricity. Thus, utility companies in the Southeast and Midwest, with access to cheaper natural gas and more reliable alternative energy generation, will be the most cost-effective locations for data centers. The map below shows that Virginia hosts the greatest number of data centers, followed by California and Texas.

  

  Dominion Energy (D) in Virginia and Entergy (ETR) in Texas are the two utility companies that may be the biggest beneficiaries of the growth of AI data centers. Both stocks have relatively low forward P/E’s of approximately 14 and dividend yields of 4.25% for D and 5.50% for ETR. It will be crucial to follow their margins to see how effectively they offset the expansion costs with rising revenue.

  Constellation Energy (CEG) and NextEra Energy (NEE) are also worth tracking as they invest heavily in renewable energy infrastructure and will benefit from increased demand. We would add Duke (DUK) and Southern Company (SO) to the list of companies to follow.

  Additional Investment Ideas

  We now present an assortment of industries and firms that can benefit.

  Technology and AI Firms

  Companies specializing in AI software for energy efficiency and management will find opportunities in this evolving landscape. Some of the more prominent names in this sector include IBM, Google, Microsoft, Oracle, and GE Vernova.

  Physical Plant Expansion

  Companies that supply utility plants with generators, transformers, circuit breakers, and switchboards, among many other parts, will undoubtedly benefit from power grid expansion.

  GE Vernova, Eaton, Quanta Services, Emerson Electric, and Siemens

  Water/Cooling

  The average data center uses 300,000 gallons of water a day to cool its equipment. That is the equivalent of the water used by 100,000 homes. Therefore, companies that can develop cheap cooling solutions for data centers will be in high demand.

  Vertiv Holdings (VRT) is a leader in this segment. Its shares have risen tenfold since it went public in 2019 and now trades at a P/E of 100. It’s a high-risk, high-reward stock, not for the faint of heart.

  Infrastructure ETFs

  There are many other businesses set to profit from the coming infrastructure boom.

  Those looking for a diversified investment approach in the power grid may want to explore thematic ETFs.

  For example, the First Trust Clean Edge Smart Grid Infrastructure Fund (GRID) holds 103 positions. Beyond diversification and portfolio manager expertise, the fund can buy stocks in foreign markets, which many US investors do not have access to or are uncomfortable with.

  iShares (IFRA) is a similar fund with a different basket of stocks and approach toward investing in the industry.

  The bottom line is we are confident the expansion and modernization of the power grid will be highly profitable for some companies. However, many companies involved, especially smaller companies with limited product offerings, offer massive rewards but substantial risks. Diversification will prove to be essential for investors.   

  Summary

  The more we researched the power grid expansion, the more industries, and companies we exposed that could benefit from it. While this article stops here, we will continue investigating the topic and share any exciting findings in the future. The number of rabbit holes is seemingly endless. We encourage you to explore the topic and share any findings you may uncover with us.

  Like the birth of the internet, some companies like AOL, Yahoo, and Sun Microsystem, which were the supposed internet leaders, fell by the waist side. Other companies, some already large, others virtually unknown, become leaders. The key to investing in this expansion is to remain vigilant for new companies and technologies that can blossom. Do not assume that the companies in charge today will be so tomorrow. Keep your head on a swivel.

  For those unable to invest the time and effort to understand industry trends and identify companies likely to profit, a fund(s) with professionals highly focused on the industry may prove an excellent way to take advantage of the potential infrastructure boom.

  Tyler Durden
  Thu, 06/06/2024 – 21:30

• Ukraine Has Requested NATO Military Instructors On Its Soil, Macron Says
  Ukraine Has Requested NATO Military Instructors On Its Soil, Macron Says

  French President Emmanuel Macron used the occasion of D-Day memorial events in France on Thursday to make some big announcements on Ukraine. This after President Biden focused much of his speech on ‘defeating Russia’ – as opposed to remembrance of WWII and those who perished on the beaches of Normandy.

  For the first time Macron said that there’s been a specific request from the Zelensky government to send French troops to Ukrainian soil in order to train forces there, amid a growing manpower shortage and severe lag in adequate training.

  “There is a challenge in capacity. That is why the Ukrainian president and his minister of defence asked all the allies — 48 hours ago in an official letter — saying ‘we need you to train us quicker and that you do this on our soil’,” Macron said in a live interview on French television, translated by AFP.

  

  While stopping short of committing to sending troops (given there’s been no consensus reached by NATO allies yet), Macron did indicate the French military will equip and train an entire brigade of 4,500 Ukrainian soldiers – but crucially this training is being conducted outside Ukraine.

  Macron also announced readiness to transfer Mirage-2000 fighter jets to Ukraine, and to train their pilots on the aircraft, while not specifying the number of jets to be sent.

  “Tomorrow we will launch a new cooperation and announce the transfer of Mirage 2000-5,” Macron indicated in the interview, referencing the fighter made by French manufacturer Dassault.

  The pilot training program will kick off this summer, and the details will reportedly be hashed out when Macron meets Ukrainian President Volodymyr Zelensky at the Elysee Palace in Paris on Friday.

  “You need normally between five-six months. So by the end of the year there will be pilots. The pilots will be trained in France,” he continued.

  As for sending Western troops directly into Ukraine, Macron cautioned, “We are working with our partners and we will act on the basis of a collective decision.”

  But at this point in the conflict this is a losing proposition and the West knows it, even if officials don’t admit it openly. There’s huge risk and only downside. President Putin and top Kremlin officials have repeatedly vowed they will attack any foreign troops found on Ukraine soil.

  Journalist and national security commentator Andrew Cockburn summed up the situation as follows: “As Russian forces steadily advance in the Kharkiv region, it is becoming ever more clear that the Ukraine war has been a disaster for the U.S. defense machine, and not just because our aid has failed to save Ukraine from retreat and possible defeat. More importantly, the war has pitilessly exposed our defense system’s deep, underlying, faults.”

  Tyler Durden
  Thu, 06/06/2024 – 21:00

• Markets Have Overreacted To OPEC's Plan To Phase Out Production Cuts
  Markets Have Overreacted To OPEC’s Plan To Phase Out Production Cuts

  By Alex Kimani of OilPrice.com

  

  OPEC+ agreed on Sunday to extend most of its oil output cuts well into 2025 amid tepid demand growth, rising U.S. production and high interest rates. OPEC+ is currently cutting output by a total of 5.86 million barrels per day (bpd), or about 5.7% of global demand, including 3.66 million bpd of cuts previously set to expire at the end of 2024, and voluntary cuts by eight members of 2.2 million bpd, expiring at the end of June 2024. The announcement led to an oil price selloff, with front-month Brent falling to a four-month low below $77 per barrel (bbl), good for a hefty $8/bbl decline from last week’s high and over $15/bbl lower from April’s YTD high.

  Commodity analysts at Standard Chartered have pointed out that the price undershooting was the consequence of markets being dominated by a combination of extreme macroeconomic pessimism; speculative shorts and over-enthusiastic algorithmic trading that crowded out more fundamentally-based traders. According to data from Bridgeton Research Group via Bloomberg, oil futures markets have now flipped to a net short position in Brent, compared with a net long position at the end of last week.

  StanChart says the oil price rout has been triggered by market expectations for a significant volume of OPEC+ oil returning to the global markets 2024; however, the analysts have argued that this explanation does not hold much water. According to StanChart, assuming market conditions are such that the increases can commence, the increase in Q4 relative to Q2 is likely to clock in at a relatively modest 360 kb/d, with the analysts saying that OPEC+ has room to increase production by 1 million b/d without upsetting market balance. Further, StanChart points out that the phase-out will be conditional depending on the state of global markets at the time with most general asset markets not expecting FOMC to follow all its current forward guidance to the letter regardless of future data and events. However, the reaction by oil markets seems to suggest that the forward guidance given by the eight OPEC+ countries concerned constitutes a determination to produce, regardless of whatever happens.

  StanChart has pointed out a number of other bullish factors that the markets have overlooked:

  •  The 1.65mb/d of voluntary cuts agreed in April 2023 have been extended to the end of 2025.
  • The required production level for all OPEC+ countries across 2025 was reaffirmed. 
  • The agreement was finally reached in the long-running discussion with the UAE, resulting in a 300kb/d increase in the UAE’s required production level, spread out over nine months starting in January 2025.
  • Russia, Iraq and Kazakhstan have agreed to produce a compensation schedule for H1 overproduction by the end of June
  • The discussion of targets in light of third-party consultant assessments of capacity was postponed until late-2025 when it may be a basis for discussion of 2026 required production.
  • The Joint Ministerial Monitoring Committee (JMMC) was given authority to request an OPEC+ ministerial meeting at any time or hold additional meetings should it choose to.

  Overall, the analysts say that OPEC+ decisions will ultimately prove positive for oil prices. More importantly, the OPEC+ report has increased transparency with the likelihood of bearish tail-risk events materializing minimized. 

  Meanwhile, StanChart has reported that there has been no change in the dominant dynamics of the European gas market, with inventories building slower than usual and the markets still proving highly sensitive to supply issues. According to Gas Infrastructure Europe (GIE) data, EU gas inventories stood at 81.75 billion cubic meters (bcm) on 2 June, good for a 1.1 bcm Y/Y increase and 14.9 bcm above the five-year average. Inventory build over the past week was 1.9 bcm, considerably lower than the five-year average for the same period of 2.8 bcm and last year’s 2.4 bcm. The experts also note that the surplus above the five-year average has fallen on 45 of the past 48 days. 

  The natural gas supply-side continues to be plagued with challenges. The latest supply disruption that triggered a rally was a fault in Norway’s Sleipner gas field. StanChart has predicted that whereas the outage is likely to be short-lived (current estimates are that repairs should be over by the coming weekend), prices are likely to remain elevated bolstered by slower-than-average inventory builds. Dutch Title Transfer Facility (TTF) gas for January 2025 delivery reached a high of EUR 43.30 per megawatt hour (MWh) on 3 June while the front-month contract reached a five-month high of EUR 38.70/MWh on the same day before falling back to settle at EUR 36.014/MWh.

  Tyler Durden
  Thu, 06/06/2024 – 20:35

• Modi's BJP Loses Parliament Majority
  Modi’s BJP Loses Parliament Majority

  Despite exit polls and projections suggesting otherwise, Prime Minister Narendra Modi and his Bharatiya Janata Party (BJP) took a considerable hit at the election for the 18th Lok Sabha, India’s lower house voted on by the country’s citizens. Compared to 2019, the BJP lost 63 seats and was 32 seats shy of the 272-seat majority. For the first time since 2014, Modi will have to rely on other parties to secure a BJP-led government. However, if alliance allegiance holds, a coalition led by Modi’s party is bound to stay in power for five more years.

  As Statista’s Florian Zandt shows in the chart below, based on data from the Election Commission of India, Modi’s National Democratic Alliance (NDA) comprised of a variety of conservative and nationalist parties won a combined 293 seats in this year’s election. Its rival, the Indian National Developmental Inclusive Alliance (INDIA), scored 234 seats. INDIA is led by the center-left Indian National Congress, which won 99 seats and whose tally was up 47 seats compared to 2019. Until the official formation of a new government, Modi has resigned as Prime Minister and will reportedly continue as a “caretaker”.

  

  You will find more infographics at Statista

  As of the time of writing, no official coalition talks have started, even though it is likely that both the BJP and INDIA will try to secure political parties not necessarily completely aligned with their views as kingmakers. Candidates include Janata Dal (United), which won 12 seats and is part of the NDA but has switched allegiance many times in the past, or the Telugu Desam Party, which can be seen as economically liberal and politically nationalist and regionalist and has won 16 seats in the election.

  The election for the 18th Lok Sabha is said to be the largest election ever worldwide. It took place over 44 days and brought out 642 million Indians to the polls, 312 million of which were women, according to Chief Election Commissioner Rajiv Kumar cited in The Hindu. Overall, 969 million citizens were registered to vote, creating a turnout of roughly 66 percent.

  Tyler Durden
  Thu, 06/06/2024 – 20:10

• A Second-Quarter Recession This Year Looks Increasingly Likely
  A Second-Quarter Recession This Year Looks Increasingly Likely

  Authored by Mike Shedlock via MishTalk.com,

  As I watch the evolution of consumer spending, housing starts, new home sales, and GDPNow trends, it appears the economy has peaked. Warning: I tend to be early.

  

  GDPNow forecast from the Atlanta Fed as of 2024-06-03. Chart by Mish

  The GDPNow forecast has been weakening since a peak of 4.2 percent on May 8, 2024.

  The best number to follow is not the overall forecast but rather Real Final Sales (RFS). The rest is inventory adjustment that nets to zero over time.

  A steep plunge occurred in the base forecast from 3.5 to 2.7 then to 1.8 on May 1 and June 3. Importantly, RFS fell from 2.9 to 2.1 to 1.8 on the same dates.

  Balance of Trade

  This rates to smack GDPNow https://t.co/47ghxVTC2z

  — Mike “Mish” Shedlock (@MishGEA) May 30, 2024

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

  I made that call on May 30.

  On June 1, I commented Soaring US Trade Deficit Smacks the Atlanta Fed GDPNow Forecast

  On June 3, the GDPNow forecast took another dive.

  The following table that shows both moves.

  GDPnow Contributions

  

  Advance Economic Indicators, specifically import-export data took the Net Exports contribution to GDP from -0.06 to -0.60 on May 31.

  Also on May 31, Personal Income and Outlays took the contribution for Personal Consumption Expenditures (PCE) from 2.28 to 1.75.

  It’s not always easy to assign the numbers to specific buckets, but the plunge in net exports is clear.

  ISM Manufacturing New Orders and Backlogs in Steep Contraction

  

  ISM chart and excerpts below by permission from the Institute for Supply Management® ISM®

  On June 3, I commented ISM Manufacturing New Orders and Backlogs in Steep Contraction

  The Manufacturing ISM was in contraction for 16 months went positive for a month and is contracting again for two months with order backlogs falling for 20 months.

  June 3 Impact to GDPNow

  On June 3, the ISM and construction spending reports clobbered PCE with lesser negative impacts on Residential Investments, Equipment, and Net Exports.

  Assigning percentages here is more difficult, and the Atlanta Fed might not be able to do so either. This is because the variables are entered at the same time and one can influence another.

  However, the decline in Residential Investment from -0.08 to -0.18 is easy to attribute to the construction spending report. The big declines from 1.75 to 1.19 on PCE and 0.42 to 0.25 on equipment are harder to attribute precisely.

  It’s important to note that what matters is not the reports but what GDPNow expected vs the reports. Bad data does not necessarily cause a decline in GDPnow, nor good data a rise.

  Below Stall Speed

  With Real Final Sales at 1.3 percent (lead chart) the economy is at stall speed. But will we stay there?

  Real (inflation-adjusted) Income and spending was negative in April. Real income was negative two of the last 3 months.

  

  Chart from the BEA, annotations by Mish

  For discussion of the above chart, please see The Fed’s Preferred Inflation Measure, PCE, Shows No Further Progress

  Real (inflation-adjusted) Income and spending was negative in April. Real income was negative two of the last 3 months.

  Personal Income Four Ways

  

  Real Disposable Personal Income (after taxes) has stalled.

  For discussion, please see Why Consumers Are Angry About the Economy in Five Pictures

  Anger Synopsis

  Consumers are angry, and it’s reflected in the polls. I have been discussing the reasons for angry consumers all year.

  But Biden and most economists still don’t get it. They think the economy is doing well. Tell that to renters looking to buy a home, stuck with rent going up month after month.

  More Soft Economic Data, Q1 GDP Revised Lower, Q4 GDI Significantly Lower

  

  GDP and GDI data from BEA, chart by Mish

  On May 30, I commented More Soft Economic Data, Q1 GDP Revised Lower, Q4 GDI Significantly Lower

  The economic slowdown continues led by income and consumer spending.

  The same story is repeating in April.

  Revisions a Hallmark of Economic Turns

  May 24: Another Massive Revision, This Time Durable Goods, What’s Going On

  May 23: New Home Sales Sink 4.7 Percent on Top of Huge Negative Revisions

  May 22: Discretionary Spending Tumbles at Target, Shares Drop 10 Percent

  May 22: Existing-Home Sales Decline 1.9 Percent, Sales Mostly Stagnant for 17 Months

  April 15: Elon Musk Fires 10 Percent of Tesla Workforce, Prepares for “Next Phase of Growth”

  Misfiring on All Cylinders

  For the past two years whenever one segment of the economy misfired, another picked up. Some labeled this a rolling recession.

  Every time consumers appeared to throw in the towel, there was another surge in spending.

  Now it appears the economy is misfiring on consumer discretionary spending, new home sales, existing-home sales, durable goods, EVs simultaneously, and income simultaneously.

  Recession Q&A

  Q: Mish aren’t you nearly always early on recession calls?
  A: Guilty as charged.

  Q: Did you call a recession that did not happen at all?
  A: Guilty as charged.

  Is the US in Recession Now? Two Prominent Competing Views

  On May 28, I discussed the question Is the US in Recession Now? Two Prominent Competing Views

  Danielle DiMartino Booth has been beating the drums for weeks that the US is in recession and has been since October. No so fast says Jim Bianco. 

  I also explain how I went wrong on my recession forecasts and why I believe Booth is early in her position that a recession started in October 2023.

  Finally, I discuss when I think recession is likely.

  In the above post I discuss the McKelvey indicator championed by DiMartino Booth. It has a pretty good but not perfect track record in forecasting recessions.

  My follow-up post was on GDPplus, another recession indicator, discussed below. First, please note the big reason the economy avoided a recession in late 2022 and 2023 was amazingly enough a tax cut!

  Tax Cuts Explain Surge in Consumer Spending in 2023

  

  Tax data from the BEA, chart by Mish

  On January 29, 2024, I commented Tax Cuts, Not Bidenomics Explains Surge in Consumer Spending in 2023

  Also, on January 1, 2023, 38 states had noteworthy tax changes. 37 of the changes put extra money in people’s pockets. The combination murdered the then-pending recession.

  For details of the tax cut please click on the previous link.

  The GDPplus Indicator

  GDPplus is a Philadelphia Fed method that blends, not averages GDP and GDI. The Philadelphia Fed revised the indicator significantly lower on Thursday.

  It’s also a very good predictor of recessions.

  

  GDPplus from Philadelphia Fed and GDI from the BEA, chart by Mish

  For discussion, please see Philadelphia Fed GDPplus Revised Significantly Lower, But No Recession Yet

  By “yet” I was referring to the idea that a recession started in 2024 Q1.

  Data is now weakening so fast, on so many fronts, that I expect a recession this year. Unlike 2023, there will be no tax cut or minimum wage hikes in 37 states to boost consumer spending now.

  Judging from the recent slide, and assuming it continues, the economy may have peaked in April with a recession starting in May.

  Label it recession by slow-acting poison of Bidenomics with a temporary 2023 reprieve due to tax cuts.

  Tyler Durden
  Thu, 06/06/2024 – 19:45

• Wall Street Admits The Biggest Economic Shocker: All Jobs In The Past Year Have Gone To Illegal Aliens
  Wall Street Admits The Biggest Economic Shocker: All Jobs In The Past Year Have Gone To Illegal Aliens

  For much of the past year we had been pounding the table on two very simple facts:  not only has the US labor market been appallingly weak, with most of the jobs “gained” in 2023 and meant to signal how strong the Biden “recovery” has been, about to be revised away (as first the Philly Fed and now Bloomberg both admit), but more shockingly, all the job growth in the past few years has gone to illegal aliens.

  We first pointed this out more than a year ago, and since then we have routinely repeated – again, again, and again – yet even though we made it abundantly clear what was happening…

  Stunning statistic: there has been ZERO INCREASE in jobs for native-born workers in over five years, since July 2018! pic.twitter.com/mxdpmPHIbO

  — zerohedge (@zerohedge) January 5, 2024

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

  … going so far as to point out the specific immigration loophole illegals were using to work in the US for up to 5 years…

  Why have all new jobs since 2018 gone to foreign-born workers (i.e. immigrants)? Because you can be an illegal immigrant in deportation proceedings (not to mention anyone seeking asylum) and get authorization to work in the US for up to 5 years, no questions asked. pic.twitter.com/VmhTBUM1I2

  — zerohedge (@zerohedge) March 10, 2024

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

  … and even fact-checking the senile, ballot-harvesting White House occupant on multiple occasions…

  Fact-check:

  1. Prices have never been higher and are starting to accelerate to the upside again
  2. All the jobs created in the past year have been part time.
  3. There has been zero job growth for native-born Americans since 2018; all jobs have gone to immigrants (mostly illegal… https://t.co/MeX7KhbaHl pic.twitter.com/OJI79p9oLp

  — zerohedge (@zerohedge) February 29, 2024

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

  … we were shocked that the topic of most if not all US jobs going to illegals was still not “the biggest political talking point” of all.

  How is this not the biggest political talking point right now: since October 2019, native-born US workers have lost 1.4 million jobs; over the same period foreign-born workers have gained 3 million jobs. pic.twitter.com/Z5HVWmQ24C

  — zerohedge (@zerohedge) January 15, 2024

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

  That’s about to change, however, because with just under 5 months left until the election, and with immigration by far the hottest political topic out there, others are finally starting to connect the dots we laid out more than a year ago.

  The first Wall Street analyst daring to point out that the employment emperor is naked, is Standard Chartered’s global head of macro, Steve Englander who in a note titled simply enough “Immigration leading to labor-market surge” (and available to pro subscribers in the usualk place), writes that according to his estimates “undocumented immigrants account for half of job growth in FY24 so far” (the actual number is far higher but we understand his initial conservatism), and adds that “asylum seekers and humanitarian parolees explain the surge in undocumented immigrants” before concluding that the continued rise in EAD approvals likely will extend strong employment growth in 2024. In other words, “strong employment growth” for American citizens, always was and remains a fabulation, and the only job growth in the US is for illegals, who will work for below minimum wage, which also explains why inflation hasn’t spiked in the past year as millions of illegals were hired.

  Below we excerpt from the Englander note because we hope that more economists, strategists and politicians will read it and grasp what we have been saying for over a year.

  Echoing what we have said for months, Englander writes that immigration, particularly illegal immigration, “is a political flashpoint that has also become an important factor in assessing economic performance. Detailed data from US Customs and Border Protection (CBP) and US Citizenship and Immigration Services (USCIS) suggest that half of non-farm payroll (NFP) growth to date for FY24 (started 1 October 2023) has been from undocumented immigrants who have received an Employment Authorization Document (EAD)” (he defines undocumented immigrants as those who entered the US through non-traditional immigration pathways, such as asylum seekers, parolees, and refugees).

  The ability to track EAD issuance to undocumented workers is an advantage in estimating how much they have contributed to employment growth. NFP counts workers with an EAD just like any other. Using that data, it is easy to estimate that undocumented workers have added 109k jobs per month to NFP out of the average 231k increase so far in FY24.

  

  Which is staggering since last night we showed that about 100K monthly jobs are purely statistical distortions, and the real pace of job growth in the past year has been around 130K.

  

  So if 100K jobs per month are fabricated birth/death artifacts (i.e., not real jobs but a statistically goalseeked fudge factor), and another 109K jobs per month are illegal aliens, that leaves just about 11K jobs for everyone else, i.e., law abiding Americans.

  It also means that the labor market in the US has – for the past year – been an absolute catastrophe and harbinger of economic disaster (and is why last night we pointed out “The “Unexpected” Reason Why The Fed Will Rush To Cut Rates As Soon As Possible“).

  But wait, as Englander himself admits, the 109K estimate of illegal aliens “may be an underestimate since undocumented immigrants often have limited access to benefits, so they may be heavily motivated to find employment. The GDP impact might be lower if these workers are less educated and face language barriers in the work force.”

  Here, Englander – who did not do the Birth/Death analysis – writes that if one excludes these illegal immigrant workers, “NFP may be running at c.125k per month” and adds that “such a pace is not recession but is hardly boom time and represents a moderate underlying pace of labor demand. It should make the 231k FY24 pace of headline NFP less worrisome to the FOMC. FOMC participants might be less hawkish if the impact of undocumented immigrants on NFP was well estimated and understood.”

  Of course, if the Std Chartered analyst were to factor for the true collapse in Birth-Death adjustments discussed yesterday by Bloomberg…

  

  … the real number would be, well, zero!

  While the political reason behind the propaganda misrepresentation of the US jobs market is simple: after all, in an election year it is imperative that the Biden economy be portrayed as glowingly as possible, even if it means lying about everything, the cascading consequences from this fabrication are staggering. As Englander concedes, “this added labor supply also may have shifted trend employment and GDP growth, making it hard to gauge whether a strong NFP or even GDP number reflects supply or demand. If supply is driving upside surprises, the takeaway is more optimism that inflation will slow. If demand, the opposite. Soft economic data should be seen through the lens of added labor supply, while strong data releases are ambiguous.”

  Taking a closer look, such increased labor supply – from illegals – should put downward pressure on wage growth relative to a baseline with less immigration (documented or not). In measures such as average hourly earnings, the disinflationary impact would be two-fold:

  1. lower wages overall from an increase of labour supply relative to labour demand and
  2. a composition effect because the undocumented immigrants often work in low wage industries even with EADs.

  However, this is likely to be a gradual process, so the low wage impact may not be immediately visible. In addition, insofar as these workers’ wages reflect relatively low productivity, the composition effect on wages will be offset by a composition effect on productivity – unit labour cost growth may be unchanged.

  These observations notwithstanding, one can assume that the contribution of undocumented immigrants to employment is unlikely to change any time soon. Indeed, over the last 12 months an average of 280k undocumented immigrants per month have been encountered nationally, most whom can or will be eligible to work legally in coming months. The same methodology suggests that these workers contributed about one-third of FY23 employment growth.

  It gets worse.

  The Congressional Budget Office (CBO) estimated that in fiscal 2023 a further 860k individuals crossed the border without contact with US immigration authorities. While these people are not eligible for EADs they may still work off the books or with fake or borrowed documents. As such, their output and spending will show up in GDP, although it is unlikely that much if any of their “labor input” is captured. These, along with others (tourists who overstay visas, students whose visas have expired, etc.) are technically undocumented as well. But since few are eligible for EADs, it is unlikely that they are captured in any BLS survey.

  In any event, Englander estimates that over 800k undocumented immigrants found jobs in FY23, and assumes that 64.2% of EAD recipients (the average for the foreign-born population) are working. However, the employment rate may well be higher since these are likely to be “very motivated” workers, since they are not generally eligible for unemployment insurance and other benefits, so work is a necessity for many.

  Ssing this calculation, and since Nonfarm Payrolls grew 3.1 million in FY23, the 800k would represent more than 25% of NFP growth.

  

  But what about those record numbers of multiple job-holders we have also discussed.

  Ah yes, to address that Englander next calculates an augmented version of NFP that includes agricultural workers, self- and family-employed workers from the household survey (CPS), and subtracts multiple-job holders. By this measure employment grew 2.7 million (this is largely due to a rise in multiple-job holders, which are subtracted to avoid double counting). So far in FY24, on average over 170k undocumented immigrants have received EAD approvals every month and c.109k have found work based on employment rates. And since NFP has averaged 230k per month, these workers likely accounted for around half of job growth. Again, this number excludes the roughly 100k per month addition coming from birth/death calculation distortions which will soon be revised away as Bloomberg’s chief economist Anna Wong calculated, before concluding that “by the end of the year the printed level of nonfarm-payrolls for 2024 likely will overstate true employment by at least one million.”

  Again, this means that when stripping away the 100K in statistical “jobs” from the 230K monthly payroll number, and then removing the 109K in illegal alien workers, the number of jobs added by ordinary, legal, native-born, Americans in the past year has been – more or less – zero.

  We, for one, can’t wait for Joe Biden to explain how this was remotely possible during his upcoming debate with Trump in three weeks time.

  Much more in the full must-read note – especially to those who will be prepping Donald Trump for his upcoming debate – from Englander available to pro subscribers in the usual place.

  Tyler Durden
  Thu, 06/06/2024 – 19:25

• Washington Preparing To Punish Maldives For Banning Israeli Passport Holders
  Washington Preparing To Punish Maldives For Banning Israeli Passport Holders

  US lawmakers are outraged at the Maldives for its recent decision to ban Israeli passport holders from entering the country due to war crimes connected with Israel’s controversial military operations in Gaza.

  The Indian Ocean archipelago state is known for its luxury resorts and high-end travel in scenic, paradise beach locations. The president’s office announced Sunday that the cabinet is moving to update national entry laws in order to bar Israeli passport holders’ entry.

  

  But US Congress members are working punish the Maldives over the controversial move, with Representative Josh Gottheimer (D-NJ) drafting legislation that could slash all aid to the Muslim-majority nation.

  Gottheimer, who has long been known as a staunch and outspoken supporter of Israel, is “working with colleagues in both parties on the bill, which will be called the Protecting Allied Travel Here (PATH) Act,” according to Axios.

  The law would condition US aid to the Maldives based on lifting its travel ban. This would in effect be a form of sanctions as it would bar current aid.

  “Taxpayer dollars shouldn’t be sent to a foreign nation that has banned all Israeli citizens from traveling to their country,” Gottheimer said in a statement.

  He added: “Not only is Israel one of our greatest democratic allies, but the Maldives’ unprecedented travel ban is nothing but a blatant act of Jew-hatred. They shouldn’t get a cent of American dollars until they reverse course.”

  But the government of the Maldives has presented its anti-Israel policies as “in solidarity with Palestinians”. Already in December the country imposed a docking ban, disallowing Israeli ships from using its ports.

  

  The Times of Israel has previously noted that “Nearly 11,000 Israelis visited the country last year, accounting for 0.6 percent of the Maldives’ foreign tourist arrivals.”

  There are 27 other Muslim-majority countries in the world which currently have a ban on Israeli passport holders – many of them located in the Middle East and North Africa.

  Tyler Durden
  Thu, 06/06/2024 – 19:20

• Overwhelming Majority Of Small Business Owners Afraid Of Biden's Economy; New Poll Finds
  Overwhelming Majority Of Small Business Owners Afraid Of Biden’s Economy; New Poll Finds

  Authored by Eric Lundrum via American Greatness,

  A new survey reveals that over two-thirds of small business owners are terrified of the state of the economy under Joe Biden’s watch, fearing that current conditions and ongoing downward trends will lead to them having to close their businesses.

  As reported by the Daily Caller, the poll from the Job Creators Network Foundation (JCNF) shows that 67% of small business owners maintain such fears about the economy as it stands today, marking a 10-point increase from sentiments two years ago. In the same poll, participants’ perceptions of economic conditions for their own businesses fell from 70.2 to 68.1. Perception of national conditions fell even more drastically, from 53.2 to 50.4.

  

  In addition to the ongoing economic woes, small business owners also feel overwhelmingly impacted by the rise of crime. In the same survey, 44% of business owners say that crime has gone up in their area. The respondents who were most likely to say crime has increased in their area are the business owners generating less than $100,000 per year, at 55%. Those who generate over $1 million in revenue were less likely to say crime has increased.

  Inflation also remains a top concern for business owners, with 49% ranking inflation as the top issue in May, compared to 48% in March. Overall inflation remains stubbornly high, coming in at 3.4% in April. The inflation rate has consistently remained above 3% since Joe Biden first took office.

  “Small businesses are more vulnerable to high taxes and costly regulatory environments compared to their large corporate counterparts,” said Elaine Parker, president of the JCNF.

  “That’s why it’s no surprise that 26% of small businesses say they’ve considered relocating to a different state or city to chase more favorable tax rates and escape government red tape. This is an opportunity for free-market minded governors to continue making their states stand out from the crowd by implementing pro-growth policy reforms that will ignite Main Street.”

  Forbes estimates that at least 46% of all employees in the United States, around 61.6 million people in total, are employed by small businesses.

  Tyler Durden
  Thu, 06/06/2024 – 18:55

• Ukraine Bans Dual Citizens From Escaping War, US Embassy Warns
  Ukraine Bans Dual Citizens From Escaping War, US Embassy Warns

  The US Embassy in Ukraine this week issued a surreal and somewhat unexpected warning: US-Ukrainian dual citizens may be prevented from leaving Ukraine under the country’s new mobilization law.

  As a result of martial law which took effect after the February 2022 invasion, Ukrainian males ages 18 to 60 are not allowed the leave the country. But until now there were exceptions for dual US-Ukrainian nationals; however, a fresh update in the national law means Americans can now be rounded up by conscription officers and potentially thrown to the front lines.

  “The US Embassy in Kyiv understands that, effective June 1, Ukraine has eliminated a ‘residence abroad’ exception that previously allowed certain Ukrainian males aged 18 to 60 to depart the country. After this change, US-Ukrainian dual citizens, including those who live in the United States, may no longer be able to depart the country,” the US Embassy announced Tuesday.

  

  This is essentially the government of Ukraine also saying that it doesn’t recognize dual citizenship. 

  While outlining the change in policy, coming amid growing desperation of Kiev authorities to tap new manpower, the US State Department is apparently going to stand back and let it happen.

  The Embassy explained in its message that it is “limited in our ability to influence Ukrainian law, including the application of martial law and the mobilization law to Ukrainian citizens.” …So the US is “limited” in its “influence” at a moment American taxpayers are pouring billions into the Zelensky government’s coffers.

  Amazingly, the embassy alert further advises all dual US-Ukrainian nationals still in the country to “shelter in place and obey all local orders.”

  The Embassy added: “If you are not currently in Ukraine, we strongly recommend against all travel to Ukraine by US citizen males aged 18 to 60 who also have Ukrainian citizenship or a claim to Ukrainian citizenship and who do not wish to stay in Ukraine indefinitely. There is an extremely high risk you will not be allowed to depart, even with a US passport.”

  

  As for the severe manpower crisis among Ukraine armed forces, the Washington Post recently highlighted that combat commanders say newly-mobilized soldiers are arriving at the front lines so poorly-trained and clueless that they can’t even disassemble their weapons,

  One soldier described his basic training as “complete nonsense… everything is learned on the spot [at the front lines].” An officer who’d trained recruits said their rifle training was limited to just 20 rounds per soldier. 

  Videos have long circulated of recruitment officers grabbling young men caught in public for conscription…

  Mass brawl breaks out during conscription attempt in Ukraine

  Injuries on both sides pic.twitter.com/NB3hZNLWJE

  — What the media hides. (@narrative_hole) May 28, 2024

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  At this point it seems the military is simply grabbing any man it can, and soon even Americans (dual citizens) caught walking Ukraine’s streets. Ukraine’s military is fairing so poorly in places like Kharkiv oblast that young men fear that being sent to front line positions is basically a death sentence.

  Tyler Durden
  Thu, 06/06/2024 – 18:30

• 334 Michiganders Registered To Vote After Their Deaths, Group Tells Court
  334 Michiganders Registered To Vote After Their Deaths, Group Tells Court

  Authored by Steven Kovac via The Epoch Times,

  “Whether by mistake or fraud,” 334 deceased Michigan registrants are listed on government records as registering to vote after their date of death, according to a recent filing in the federal Sixth Circuit Court of Appeals by the Public Interest Legal Foundation (PILF).

  Nearly four years ago, the PILF discovered 27,000 names of likely deceased registrants on the state’s Qualified Voter File (QVF).

  The group asked Michigan Secretary of State Jocelyn Benson, a Democrat, about her plan to remove them.

  

  In this screenshot from the livestream of the 2020 Democratic National Convention, Michigan Secretary of State Jocelyn Benson addresses delegates on Aug. 20, 2020. (DNCC via Getty Images)

  They gave Ms. Benson over one year to act or, at a minimum, make available for public inspection a detailed plan of action for canceling the voter registrations of the dead. She did neither.

  According to the PILF filing, Michigan election officials were “unresponsive to specific, sound data provided by the Foundation” regarding the deceased registrants, many of whom had been on the QVF for decades.

  “Secretary Benson is vigorously opposing efforts to remove tens of thousands of deceased registrants we found on the voter roll,” said PILF President J. Christian Adams in a May 29 press release.

  “Federal law requires state election officials to have a reasonable program to remove the dead. Keeping dead voters on the rolls for two decades isn’t reasonable. This case will have significant implications for whether effective maintenance is required by federal law,”

  Auditor General Confirmed Numbers

  In 2021, the Michigan Auditor General’s office conducted what it called “a death match for active voters in the QVF.”

  The match yielded the names of between “twenty and thirty thousand” deceased registrants on the voter rolls.

  A three-and-a-half-year legal battle ensued, beginning with the PILF filing a two-point complaint in the federal district court alleging that Ms. Benson failed to conduct list maintenance and failed to allow inspection of public records concerning her plan to remove the deceased, and other data.

  On March 1, 2024, the district court entered a summary judgment rejecting both of PILF’s points, which led the foundation to take the case to the federal Sixth Circuit Court of Appeals.

  In announcing its victory in the district court, the Michigan Department of State issued a statement on March 2 calling the PILF’s efforts “a thinly veiled attempt to undermine voters’ faith in their voice, their vote, and our democracy.”

  According to the PILF filing, the appeal presents questions of “first impression for this Court and raises issues of national importance regarding the interpretation of the National Voter Registration Act.”

  In law, a first impression is a new legal issue or interpretation that is brought before a court.

  The NVRA of 1993 (known as “Motor Voter”) requires states to “conduct a general program that makes a reasonable effort to remove the name of ineligible voters” due to death.

  PILF lawyers contend that the exact meaning of the phrase “reasonable effort” has not been addressed by the Sixth Circuit Court of Appeals or any court within that court’s jurisdiction since the law’s enactment in 1993.

  The district court concluded that whatever Ms. Benson is doing to clean up and maintain the voter rolls constitutes a reasonable effort and, therefore, found that she complied with the NVRA requirement.

  The PILF asserts that an ineffectual, mistake-ridden, voter list maintenance program that allows between 20,000 and 30,000 dead people to remain on the QVF for decades should not be considered reasonable.

  According to the PILF, merely having a nominal voter roll maintenance program in place is not enough to satisfy the NVRA.

  What matters to the intent of Congress is “whether the Secretary effectively follows the list maintenance statutes and procedures,” the appeal said. “The Secretary seeks to evade scrutiny by relying on something labeled a ‘program’ to remove deceased registrants, no matter how ineffective.”

  Discovery Limited, Depositions Denied

  Also, according to the PILF appeal, the district court erred by granting Ms. Benson’s request for summary judgment without the secretary of state being deposed by the plaintiff.

  Earlier, Ms. Benson convinced a court magistrate that she was too busy to sit for the deposition and obtained a protective court order to block the process.

  The appeal stated that PILF was not only denied the ability to depose Ms. Benson but also could not depose an SOS employee who conducted voter list analysis, and the Electronic Registration Information Center (ERIC), upon which Michigan and about two dozen other states rely for data identifying ineligible voters.

  The district court order required the PILF to first show defects in ERIC’s process of identifying deceased voters before having the opportunity to learn what those processes and procedures were through deposition.

  “These denials of discovery should be reversed so the complete picture and truth about the Secretary’s list maintenance programs can be ascertained,” the appeal brief said.

  Because of the danger of recurring injury, the PILF appeal stated that a permanent prospective injunction to compel Ms. Benson to comply with her responsibilities under the NVRA would be warranted.

  PILF attorneys stressed the importance of timely compliance before another federal election takes place.

  The PILF asked the appeals court to reverse the district court and render judgment that Secretary Benson violated the NVRA’s Public Disclosure Provision, or to remand that claim to the district court for reconsideration.

  Tyler Durden
  Thu, 06/06/2024 – 18:05

• La Nina Will Complicate Things For Biden Ahead Of Elections As Hurricanes Threaten Oil Refineries
  La Nina Will Complicate Things For Biden Ahead Of Elections As Hurricanes Threaten Oil Refineries

  The Biden administration must now contend with the La Nina weather phenomenon, which is expected to fuel an active Atlantic hurricane season. These storms could potentially disrupt major US Gulf Coast refineries, driving average gasoline prices at the pump to the politically sensitive $4 a gallon mark ahead of the November presidential elections. 

  News last month of the Department of Energy planning to release a million barrels of gasoline from reserves held in the Northeast ahead of the Fourth of July holiday and summer driving season shows just how concerned Democrats in the White House are about elevated inflation as their election odds falter. 

  According to the National Oceanic and Atmospheric Administration, La Nina conditions indicate reduced wind shear in the Alantic Basin, which promotes more tropical development in the Caribbean Sea. 

  

  “The upcoming Atlantic hurricane season is expected to have above-normal activity due to a confluence of factors, including near-record warm ocean temperatures in the Atlantic Ocean, development of La Nina conditions in the Pacific, reduced Atlantic trade winds and less wind shear, all of which tend to favor tropical storm formation,” NOAA wrote in a recent update. 

  Here’s a breakdown of NOAA’s hurricane season forecast: 

  • NOAA predicts an 85% chance of an above-normal 2024 Atlantic hurricane season.

  • There’s a 10% chance of a near-normal season.

  • There’s a 5% chance of a below-normal season.

  • The forecast includes 17 to 25 total named storms (winds of 39 mph or higher).

  • 8 to 13 of these storms are expected to become hurricanes (winds of 74 mph or higher).

  • 4 to 7 of the hurricanes may become major hurricanes (category 3, 4, or 5; winds of 111 mph or higher).

  • Forecasters have 70% confidence in this range

  Given the context that La Nina is set to produce a more active hurricane season, Goldman analysts are now focusing on the potential refinery impacts of these storms and what this could potentially mean for gasoline prices at the pump.

  

  Goldman’s Callum Bruce’s base case is that gasoline pump prices average around $3.3/gallon through October.

  Bruce estimates pump prices in October could jump to the politically sensitive level of nearly $4 if the hurricane season is super active. If the season is calm, prices drop to $3.2.

  Here’s more from the report:

  This fall’s hurricane season, focused around August-October, but spilling modestly into July and November, may therefore be unusually important for the upcoming US Presidential election.

  The National Oceanic and Atmospheric Administration (NOAA) predicts an above-normal Atlantic hurricane season, issuing a record high forecast for storms, hurricanes, and major hurricanes in its May outlook. The midpoint of its stated forecast ranges for each category is 100-200% of their historical averages (Exhibit 3).

  

  Hurricanes have the potential to cause significant disruptions to US Gulf Coast refining capacity, where c.50% of US capacity lies. Most hurricanes that hit the refining centers on the Gulf Coast will take out 0.5-2.5 mb/d of refining capacity temporarily. Hurricane disruptions in the top quartile of events will take out more than 1mb/d of capacity for over a month. While these impacts are mostly temporary, large disruptions can leave c.10% of the peak disrupted capacity offline for a more extended period of time (Exhibit 4).

  

  Wholesale gasoline refining margins have the potential to spike around these events (Exhibit 5), by $5/bbl or more, depending on the exact path of the hurricanes. Gasoline prices tend to be most volatile as – unlike distillate – the US is a net importer, and resupply is much further away.

  

  The price impact tends to dissipate relatively quickly, however, as refining capacity returns relatively rapidly. In addition, there can be significant negative impacts on demand from the poor weather and flooding. We find that large USGC hurricanes disrupt 100 kb/d of demand on average in the affected months, and closer to 300 kb/d for the largest. Evacuations provide only a modest offsetting boost (<25 kb/d).

  Diesel margins meanwhile benefit more sustainably as demand is only modestly impacted (<50 kb/d) as reconstruction and rescue efforts support consumption (Exhibit 6).

  

  Nevertheless, retail gasoline prices can remain supported for longer as retailers are slow to lower prices after the initial spike, allowing marketing margins to expand. Despite normalized wholesale gasoline margins within a month, the top quartile of hurricane disruptions saw retail gasoline margins $0.20/gal higher over the following couple of months. The largest hurricanes have the capacity to raise these retail prices by almost $0.50/gal at their peak over this time period (Exhibit 7).

  

  This may be amplified by a normalisation in current very low speculative positioning in refined products – 10th-20th percentile across refined products. Our prior research has found a c.$5/bbl impact on wholesale refined product margins simply from positioning normalisation, equating to around c.$0.10/gal at the retail level.

  A significant hurricane disruption combined with a normalisation in positioning could therefore lift Oct-24 retail gasoline prices by $0.2-0.5/gal above our baseline forecasts over the full month (Exhibit 8). An extreme disruption would therefore take US retail gasoline prices to $4/gal, potentially leading to a spike in media coverage. However, retail prices would drop to $3.2/gal if crude prices are flat and disruptions are avoided.

  

  Queue up more SPR gasoline dumps if the active hurricane season takes out a refinery or two, as the administration will do everything in its power to prevent pump prices from hitting $4 before the elections.

  So who wins?

  Biden arrives at Omaha Beach in his perpetual state of confusion pic.twitter.com/FKgllybpyN

  — RNC Research (@RNCResearch) June 6, 2024

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

  Mother Nature or elderly Biden?

  Tyler Durden
  Thu, 06/06/2024 – 17:40

• School To Use Remote Tracking Wristbands On Children
  School To Use Remote Tracking Wristbands On Children

  Authored by Steve Watson via Modernity.news,

  A school in Switzerland has controversially announced it will trial tracking wristbands on children to keep tabs on their location.

  

  As highlighted by Remix News, Swiss outlet Neue Zürcher Zeitung reports that the Letten after-school care centre in Birmensdorf will require kids to wear the Bluetooth tech at all times during care hours unless parents specifically opt out.

  Teachers will be able to remotely monitor individual children or groups of them, and will be alerted if a child leaves the school grounds without permission. https://t.co/u38K5EZUMo

  — Remix News & Views (@RMXnews) June 5, 2024

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

  The wristbands will track the wearers, with staff being alerted should a pupil wander outside the sanctioned location without prior authorisation.

  The justification given for the tracking is that the number of children in the facility is always changing and that it is necessary to provide “high quality care.”

  The report also notes that “important individual information about food intolerances” can be stored in the system for the children to make check-in at lunch easier.

  The report notes that the tracking system was developed by the head of the education centre, Joel Giger, as part of a start-up called Companion.

  Theo school administrators stated “Birmensdorf school can gain new insights through the pilot project and at the same time offer the company the opportunity to test the product together with specialists on-site as part of the pilot project.”

  Sounds like the guy is using school kids as Guinea pigs for his big brother surveillance side hustle.

  Swiss cantonal data protection authority spokesman Hans Peter Waltisberg notes that “a permanent localization of pupils does not seem necessary for the care of children.”

  “It should be examined whether a Bluetooth wristband is the appropriate means of localization. For example, the fact that a wristband can also be removed must be taken into account,” he added.

  Similar technology is used to literally keep tabs on parolees or convicts released on the proviso of good behaviour.

  If the educational centre wants to become known as the school that treats children like prisoners it’s going about it the right way.

  *  *  *

  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
  Thu, 06/06/2024 – 17:15

• "It's Mind-Boggling": Los Angeles Hit With Surge Of Fire Hydrant Thefts
  “It’s Mind-Boggling”: Los Angeles Hit With Surge Of Fire Hydrant Thefts

  Just when you think the Democrats’ socialist utopia state of California can’t possibly sink any higher (sic), it does just that: first it was catalytic converters, now it’s fire hydrants.

  According to CBS News, a California state water company has responded to a growing frenzy of fire hydrant thefts in Los Angeles by installing locked shields to cover the bolts on hydrants to stop thieves.

  

  Golden State Water Company, which owns and operates the fire hydrants, says thefts now happen daily, especially in South Los Angeles, which is one of the impoverished communities where thefts are extremely high, with two of the most recent believed to have happened last Thursday without neighbors even realizing it.

  “It’s mind-boggling that someone would just come into a neighborhood and just steal a fire hydrant,” neighbor Krystail Cousins said. “You’re now putting a whole neighborhood in danger.”

  And yet that is precisely what Krystail’s predominantly minority neighbors have been engaged in.

  The water company’s Southwest District general manager, Kate Nutting, said as the hydrants are made of iron and brass, she believes they are being sold on the black market for scrap metal.

  “Since the beginning of 2023, we’ve had over 300 hydrants stolen, and it’s been ramping up in 2024 which is why we’ve been taking even more aggressive measures to try to stop it”, Nutting said. “We’re really alarmed about this happening. It is a big public safety issue.”

  The measures the company has taken include welding hydrants to block access to the bolts, Nutting said. But thieves have continued, with methods including ramming hydrants with vehicles or using specialized tools to remove metal parts.

  “In some cases, they are very persistent in getting those parts out,” Nutting said.

  Many of the thefts have occurred in the communities of Florence-Graham, Willowbrook and West Rancho Dominguez, as well as eastern Gardena near the 110 Freeway.

  Sometimes, thieves have unscrewed bolts to remove hydrants. Other times, they’ve used a vehicle to knock the hydrant loose. Those targeting the hydrants have often used a shutoff valve before dislodging them. But on several occasions, they’ve left water gushing.

  The company has been sending out replacements typically the same day they are reported stolen, each one costing about $3,500. It’s not clear what their value is on the black market. The total cost of all the stolen hydrants has amounted to over a $1.2 million loss, the company said.

  

  Missing hydrants are also a safety risk, as it impedes fire-fighting capabilities and the water company said it can potentially compromise the water system’s ability to deliver safe and reliable drinking water. The L.A. County Fire Department said the thefts pose a threat to public safety.

  “Fire hydrants are crucial in providing a reliable water source for firefighting operations, and their absence can hamper rescue efforts and lead to delays extinguishing fires,” the department said in an email.

  Experts agree that small delays in fighting fires can be pivotal. Venkatesh Kodur, a professor and director of Michigan State University’s Center on Structural Fire Engineering and Diagnostics, said the best opportunity to knock down a blaze, particularly a house fire, is within the first five to 10 minutes, when damage is still minimal.

  Typically after 15 minutes, he said, “the damage and the fire grows almost exponentially … and every second is important.”

  Kodur said if the work of fighting a fire is hindered by a missing hydrant, the flames can spread more easily. And although the thieves may be lured by the payday, Kodur said, the fact is that brass, copper and steel don’t fetch very much money.

  “These are people selling these metals to scrap dealers for peanuts,” Kodur said.

  Yet “peanuts” is precisely what the desperate locals will do anything for at a time when the scourge that is “Bidenomics” has left them beyond broke.

  Golden State Water wants to remind thieves that tampering with fire hydrants is a federal crime; then again gun sales in Chicago are “illegal” which has shockingly failed to stop local minorities from mass exterminating each other at a record pace in recent years.

  Tyler Durden
  Thu, 06/06/2024 – 16:50

• What's Next For Battlefield America? Israel's High-Tech Military Tactics Point The Way
  What’s Next For Battlefield America? Israel’s High-Tech Military Tactics Point The Way

  Authored by John & Nisha Whitehead via The Rutherford Institute,

  “I did not know Israel was capturing or recording my face. [But Israel has] been watching us for years from the sky with their drones. They have been watching us gardening and going to schools and kissing our wives. I feel like I have been watched for so long.”

  – Mosab Abu Toha, Palestinian poet

  If you want a glimpse of the next stage of America’s transformation into a police state, look no further than how Israel – a long-time recipient of hundreds of billions of dollars in foreign aid from the U.S. – uses its high-tech military tactics, surveillance and weaponry to advance its authoritarian agenda.

  

  Military checkpoints. Wall-to-wall mass surveillance. Predictive policing. Aerial surveillance that tracks your movements wherever you go and whatever you do. AI-powered facial recognition and biometric programs carried out with the knowledge or consent of those targeted by it. Cyber-intelligence. Detention centers. Brutal interrogation tactics. Weaponized drones. Combat robots.

  We’ve already seen many of these military tactics and technologies deployed on American soil and used against the populace, especially along the border regions, a testament to the heavy influence Israel’s military-industrial complex has had on U.S. policing.

  Indeed, Israel has become one of the largest developers and exporters of military weapons and technologies of oppression worldwide.

  Journalist Antony Loewenstein has warned that Pegasus, one of Israel’s most invasive pieces of spyware, which allows any government or military intelligence or police department to spy on someone’s phone and get all the information from that phone, has become a favorite tool of oppressive regimes around the world. The FBI and NYPD have also been recipients of the surveillance technology which promises to turn any “target’s smartphone into an intelligence gold mine.”

  Yet it’s not just military weapons that Israel is exporting. They’re also helping to transform local police agencies into extensions of the military.

  According to The Intercept, thousands of American law enforcement officers frequently travel for training to Israel, “one of the few countries where policing and militarism are even more deeply intertwined than they are here,” as part of an ongoing exchange program that largely flies under the radar of public scrutiny.

  A 2018 investigative report concluded that imported military techniques by way of these exchange programs that allow police to study in Israel have changed American policing for the worse. “Upon their return, U.S. law enforcement delegates implement practices learned from Israel’s use of invasive surveillance, blatant racial profiling, and repressive force against dissent,” the report states. “Rather than promoting security for all, these programs facilitate an exchange of methods in state violence and control that endanger us all.”

  “At the very least,” notes journalist Matthew Petti, “visits to Israel have helped American police justify more snooping on citizens and stricter secrecy. Critics also assert that Israeli training encourages excessive force.”

  Petti documents how the NYPD set up a permanent liaison office in Israel in the wake of 9/11, eventually implementing “one of the first post-9/11 counterterrorism programs that explicitly followed the Israeli model. In 2002, the NYPD tasked a secret ‘Demographics Unit’ with spying on Muslim-American communities. Dedicated ‘mosque crawlers’ infiltrated local Muslim congregations and attempted to bait worshippers with talk of violent revolution.”

  That was merely the start of American police forces being trained in martial law by foreign nations under the guise of national security theater. It has all been downhill from there.

  As Alex Vitale, a sociology professor who has studied the rise of global policing, explains, “The focus of this training is on riot suppression, counterinsurgency, and counterterrorism—all of which are essentially irrelevant or should be irrelevant to the vast majority of police departments. They shouldn’t be suppressing protest, they shouldn’t be engaging in counterinsurgency, and almost none of them face any real threat from terrorism.”

  This ongoing transformation of the American homeland into a techno-battlefield tracks unnervingly with the dystopian cinematic visions of Steven Spielberg’s Minority Report and Neill Blomkamp’s Elysium, both of which are set 30 years from now, in the year 2054.

  In Minority Report, police agencies harvest intelligence from widespread surveillance, behavior prediction technologies, data mining, precognitive technology, and neighborhood and family snitch programs in order to capture would-be criminals before they can do any damage.

  While Blomkamp’s Elysium acts as a vehicle to raise concerns about immigration, access to healthcare, worker’s rights, and socioeconomic stratification, what was most striking was its eerie depiction of how the government will employ technologies such as drones, tasers and biometric scanners to track, target and control the populace, especially dissidents.

  With Israel in the driver’s seat and Minority Report and Elysium on the horizon, it’s not so far-fetched to imagine how the American police state will use these emerging technologies to lock down the populace, root out dissidents, and ostensibly establish an “open-air prison” with disconcerting similarities to Israel’s technological occupation of present-day Palestine.

  For those who insist that such things are celluloid fantasies with no connection to the present, we offer the following as a warning of the totalitarian future at our doorsteps.

  Facial Recognition

  Fiction: One of the most jarring scenes in Elysium occurs towards the beginning of the film, when the protagonist Max Da Costa waits to board a bus on his way to work. While standing in line, Max is approached by two large robotic police officers, who quickly scan Max’s biometrics, cross-check his data against government files, and identify him as a former convict in need of close inspection. They demand to search his bag, a request which Max resists, insisting that there is nothing for them to see. The robotic cops respond by manhandling Max, throwing him to the ground, and breaking his arm with a police baton. After determining that Max poses no threat, they leave him on the ground and continue their patrol. Likewise, in Minority Report, police use holographic data screens, city-wide surveillance cameras, dimensional maps and database feeds to monitor the movements of its citizens and preemptively target suspects for interrogation and containment.

  Fact: We now find ourselves in the unenviable position of being monitored, managed, corralled and controlled by technologies that answer to government and corporate rulers. This is exactly how Palestinian poet and New Yorker contributor Mosab Abu Toha found himself, within minutes of passing through an Israeli military checkpoint in Gaza with his wife and children in tow, asked to step out line, only to be blindfolded, handcuffed, interrogated, then imprisoned in an Israeli detention center for two days, beaten and further interrogated. Toha was finally released in what Israeli soldiers chalked up to a “mistake,” yet there was no mistaking the AI-powered facial recognition technology that was used to pull him out of line, identify him, and label him (erroneously) as a person of interest.

  Drones

  Fiction: In another Elysium scene, Max is hunted by four drones while attempting to elude the authorities. The drones, equipped with x-ray cameras, biometric readers, scanners and weapons, are able to scan whole neighborhoods, identify individuals from a distance—even through buildings, report their findings back to police handlers, pursue a suspect, and target them with tasers and an array of lethal weapons.

  Fact: Drones, some deceptively small and yet powerful enough to capture the facial expressions of people hundreds of feet below them, have ushered in a new age of surveillance. Not even those indoors, in the privacy of their homes, will be safe from these aerial spies, which can be equipped with technology capable of peering through walls. In addition to their surveillance capabilities, drones can also be equipped with automatic weapons, grenade launchers, tear gas, and tasers.

  Biometric scanners and national IDs

  Fiction: Throughout Elysium, citizens are identified, sorted and dealt with by way of various scanning devices that read their biometrics—irises, DNA, etc.—as well as their national ID numbers, imprinted by a laser into their skin. In this way, citizens are tracked, counted, and classified. Likewise, in Minority Report, tiny sensory-guided spider robots converge on a suspected would-be criminal, scan his biometric data and feed it into a central government database. The end result is that there is nowhere to run and nowhere to hide to escape the government’s all-seeing eyes.

  Fact: Given the vast troves of data that various world governments, including Israel and the U.S., is collecting on its citizens and non-citizens alike, we are not far from a future where there is nowhere to run and nowhere to hide. In fact, between the facial recognition technology being handed out to law enforcement, license plate readers being installed on police cruisers, local police creating DNA databases by extracting DNA from non-criminals, including the victims of crimes, and police collecting more and more biometric data such as iris scans, we are approaching the end of anonymity. It won’t be long before police officers will be able to pull up a full biography on any given person instantaneously, including their family and medical history, bank accounts, and personal peccadilloes. It’s already moving in that direction in more authoritarian regimes.

  Predictive Policing

  Fiction: In Minority Report, John Anderton, Chief of the Department of Pre-Crime, finds himself identified as the next would-be criminal and targeted for preemptive measures by the very technology that he relies on for his predictive policing. Consequently, Anderton finds himself not only attempting to prove his innocence but forced to take drastic measures in order to avoid capture in a surveillance state that uses biometric data and sophisticated computer networks to track its citizens.

  Fact: Precrime, which aims to prevent crimes before they happen, has justified the use of widespread surveillance, behavior prediction technologies, data mining, precognitive technology, and snitch programs. As political science professor Anwar Mhajne documents, Israel has used all of these tools in its military engagements with Palestine: deploying AI surveillance and predictive policing systems in Palestinian territories; utilizing facial recognition technology to monitor and regulate the movement of Palestinians; subjecting Palestinians to facial recognition scans at checkpoints, with a color-coded mechanism to dictate who should be allowed to proceed, subjected to further questioning, or detained.

  Making the Leap from Fiction to Reality

  When Aldous Huxley wrote Brave New World in 1931, he was convinced that there was “still plenty of time” before his dystopian vision became a nightmare reality. It wasn’t long, however, before he realized that his prophecies were coming true far sooner than he had imagined.

  Israel’s military influence on the United States, its advances in technological weaponry, and its rigid demand for compliance are pushing us towards a world in chains.

  Through its oppressive use of surveillance technology, Israel has erected the world’s first open-air prison, and in the process, has made itself a model for the United States.

  What we cannot afford to overlook, however, is the extent to which the American Police State is taking its cues from Israel.

  As I make clear in my book Battlefield America: The War on the American People and in its fictional counterpart The Erik Blair Diaries, we may not be an occupied territory, but that does not make the electronic concentration camp being erected around us any less of a prison.

  Tyler Durden
  Thu, 06/06/2024 – 16:25

• Market Pancakes As Nvidia Gamma Squeeze Fizzles, Attention Turns To Jobs, Global Easing Cycle
  Market Pancakes As Nvidia Gamma Squeeze Fizzles, Attention Turns To Jobs, Global Easing Cycle

  After yesterday’s breathless Nvidia-led meltup, which saw the AI chipmaker surpass both $3 trillion in market cap and Apple’s valuation, today’s session was a boring affair by comparison, which saw the S&P close unchanged after a day in which the index barely moved.

  

  There were three reasons behind the lack of action.

  First, technicals.  As Goldman’s Brian Garrett notes, ES 5350 is the “magnetized” strike, with $9.5 billion of gamma – a record amount – to trade per 100bps; This means that dealers have to sell 35,000 eminis on a 1% rally, and buy 35,000 eminis on a 1% sell off. Said otherwise, the record dealer gamma is now preventing spoos from moving too far, too fast in either direction from 5350.

  

  Second, tech momentum died. After yesterday’s remarkable gamma squeeze in NVDA, which saw near calls explode as if the underlying was some penny stock and not a $3 trillion behemoth…

  The world’s biggest company (because NVDA will surpass MSFT tomorrow) is getting gamma squeezed pic.twitter.com/b7PltycG2j

  — zerohedge (@zerohedge) June 5, 2024

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

  … an early morning “rugging” of NVDA – which saw the stock lose $175 billion in market cap just seconds after the cash close as call holders liquidated positions – crushed momentum and made sure the stunning gamma squeeze would quietly fade away.

  

  As a result, NVDA was unable to hold on to its brand new position as the world’s 2nd most valuable company, and promptly relinquished that – and the $3 trillion market cap threshold – back to AAPL, if only for the day. Tomorrow is another day when the pre-10:1 stock split bulls will try to make NVDA the world’s biggest stock, ahead of Monday.

  

  Third, event risk. tomorrow we get a key jobs report, now that payrolls are once again more important than inflation, and as Goldman pointed out earlier today dealers are the longest spot gamma in history, but net short the upside tail. This means that nobody is too crazy to place big directional bets ahead of a print which could see momentum ignited in either direction depending on how the NFP print comes.

  

  Incidentally, Goldman believes that the set up into the print remains favorable for stocks, with a goldilocks NFP zone in the low 100s as stocks continue to cheer for a palatable slowdown). We think Big Data measures indicate a below-normal pace of job creation during the spring hiring season, and our layoff tracker has rebounded. Street is looking for a headline reading of +185k (GIR +160k, prior +175k

  And while today was boring, with little newsflow besides the latest twit from Roaring Kitty who sent GameStock soaring more than 40% just because he announced he would have a youtube livestream tomorrow at noon…

  

  … another historic event quietly took place when the ECB became only the second G7 bank to cut rates – after a 5 year hiatus …

  

  … even as the central bank raised (!) its inflation forecasts…

  

  … guaranteeing that any pretense of a 2% inflation target is dead and buried, something which wasn’t lost on gold and silver, both of which have soared ever since Canada cut rates first yesterday…

  

  … nor was it lost on oil which has recovered a big chunk of its latest losses.

  

  The only asset class which remained completely clueless to the return of central bank easing was – ironically – crypto, with both bitcoin and especially ethereum dumping even though traditionally they have been the best early indicators of shifting liquidity and volatility conditions. Today however, manipulation from the Jane Streets of the world and other HFT momentum igniters overcame any nascent recent bullishness…

  

  … which will guarantee that the army of bitcoin ETF buyers – who now own 1 million bitcoin among them, leaving less than 20 million available – will just have another cheap entry point.

  

  Tyler Durden
  Thu, 06/06/2024 – 16:01

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