Nov 07

Today’s News 7th November 2022

  • Why China's Marriage Crisis Is An Existential Threat To The Country
    Why China’s Marriage Crisis Is An Existential Threat To The Country

    Authored by John Mac Ghlionn via The Epoch Times,

    President Xi Jinping recently vowed to launch comprehensive initiatives to address China’s rapidly declining birth rate.

    Behind the bombastic rhetoric, however, there lies a truly sobering fact: new policies probably won’t be enough to arrest China’s demographic decline. Here’s why.

    In China, a hyper-traditional society, having a child out of wedlock is still frowned upon. Childbearing and childrearing are synonymous with marriage. Last year, the communist nation saw marriage rates hit a 35-year low. The sharp drop in marital vows comes at the same time China faces an impending demographic crisis. 2021 saw 7.6 million marriage registrations, the fewest since 1986. With falling birth rates and a rapidly aging population, China faces problems that are very much existential in nature.

    In truth, China’s marriage crisis has been an issue for the best part of a decade. In the space of six years, between 2013 and 2019, the number of Chinese citizens getting married fell from 23.8 million to 13.9 million, a 41 percent drop. Of course, the Chinese Communist Party’s (CCP) ill-advised one-child policy, which was in place for 35 years (1980–2015), has resulted in far fewer people of marriageable age. The policy resulted in 400 million fewer babies being born.

    Medical staff takes care of a newborn baby at a hospital in Fuyang in China’s eastern Anhui province, on Jan. 19, 2019. (STR/AFP via Getty Images)

    China has also witnessed “changing attitudes to marriage, especially among young women who are becoming more educated and financially independent,” according to CNN. Due to “widespread workplace discrimination” and “patriarchal traditions,” an increasing number of women are saying no to marriage.

    Some readers, I’m sure, will roll their eyes at the “patriarchal traditions” bit. If you happen to be one of them, I don’t blame you. I have been highly critical of the ways in which the “p word” has been weaponized and demonized by many individuals in the United States and beyond. However, patriarchal traditions look a little different in China than, say, the United States or the UK. The Chinese, we’re told, have a rather controversial saying: “If you don’t beat your wife every three days, she’ll start tearing up roof tiles.” A quarter of Chinese women are victims of domestic violence. Every 7.4 seconds a wife is beaten by her husband. As is clear to see, Chinese women can be forgiven for having second thoughts about marriage, especially if they were raised in an abusive household.

    Besides the violence, there’s also another reason why fewer Chinese people are deciding to walk down the aisle. China is an incredibly expensive place to live. According to Mercer’s Cost of Living Index 2022, six of the biggest Chinese cities—Beijing, Shanghai, Shenzhen, Guangzhou, Qingdao, and Nanjing—are among the top 10 most expensive cities on the Asian continent. Meanwhile, Hong Kong, more or less controlled by Beijing, is the most expensive city in the world. Not surprisingly, more Hong Kongers are saying no to marriage and no to starting a family. If one is struggling to pay rent, having a child is probably the last thing on their mind.

    So what, some will say, cities in the United States, UK, and Western Europe are also ridiculously expensive to live in. Yes, they are. But China’s GDP per capita is less than $10,000. This places the country between the Balkan nation of Montenegro and Botswana, located in southern Africa. The United States, on the other hand, has a GDP per capita of $69,000.

    A man walks in front of a housing complex by Chinese property developer Evergrande in Beijing on Oct. 21, 2021. (Noel Celis/AFP via Getty Images)

    For years, we have heard so much about China’s impressive GDP growth. At the same time, however, we have heard very little about its less-than-impressive GDP per capita.

    What’s my point?

    There are at least 90 million people currently working in Chinese factories. In a year, they can expect to earn roughly 55,000 RMB (less than $8,000). Even those working in more prestigious positions struggle to make more than $16,000 per year. By 2035, China’s GDP per capita is expected to be $28,700. Try getting married, paying rent, buying necessities, and starting a family on $28,700.

    Moreover, it’s particularly difficult to start a family (or do anything of value) when you can’t find a job. Right now, China’s youth unemployment is close to 20 percent (8.1 percent in the United States (pdf)). Of course, China’s marriage problem isn’t exactly unique. Other countries around the world, including the United States, are also experiencing their own marriage-related issues. However, the size of the problem facing China and the CCP is, for lack of a better word, gigantic—especially now that its economy appears to be going down the proverbial lavatory.

    Analysts at The Lowy institute, a Sydney-based think tank, insist that, even with “continued broad policy success,” China’s “annual economic growth will slow to about 3% by 2030 and 2% by 2040.” China’s economy, we’re told, appears to be suffering from a crisis in confidence among consumers. Is it any surprise? The average Chinese citizen, be they 25 or 75, is struggling to survive.

    In an effort to address the marriage crisis, there’s always the chance that the CCP could use its cruel social credit system to punish adults who refuse to get married and start a family. The CCP might take inspiration from Russia, its close ally, where couples are currently being offered financial incentives to get married and have children. But, commonsense tells us that it will take a lot more than one-off payments and tax subsidies to solve China’s marriage situation, a problem that is fast becoming existential in nature. Money is a necessity, but it’s no substitute for genuine desire. Today, for reasons already explained, very few Chinese have any desire to get married. As the country becomes older and less efficient, expect the flame of desire to become even more faint.

    …

    Read more here…

    Tyler Durden
    Sun, 11/06/2022 – 23:30

  • Late Season Tropical Threat Emerges, Gov. DeSantis Warns "Floridians To Be Prepared"
    Late Season Tropical Threat Emerges, Gov. DeSantis Warns “Floridians To Be Prepared”

    The end of November marks the close of the 2022 Atlantic hurricane season. There are a little more than three weeks left in the season, and AccuWeather forecasters say a tropical threat has emerged just north of the Caribbean and could strengthen into a storm next week, with Florida in the crosshairs.

    A low-pressure system developed on Saturday just south of Puerto Rico. By Sunday, the system, dubbed Invest 98L, moved North of Puerto Rico and has an 80% chance of developing into a subtropical or tropical depression over the next two days. It has a 90% chance of developing over the next five days.

    AccuWeather forecasters warn, “this tropical rainstorm will become better organized and likely become a tropical storm as it takes a winding track toward the Bahamas and storm-weary Florida.” If it develops into a tropical storm in the Atlantic basin, it will be named “Nicole.” 

    AccuWeather storm track modeling shows the system is on a westward path and could make landfall in South Florida in the second half of the week. 

    Gov. Ron DeSantis and other state officials told Floridians to be prepared for potential tropical impacts. 

    “I encourage all Floridians to be prepared and make a plan in the event a storm impacts Florida.

     “We will continue to monitor the path and trajectory of Invest 98L and we remain in constant contact with all state and local government partners,” DeSantis said.

    The exact landfall timing and location are uncertain but could affect many Floridians still recovering from Hurricane Ian in September. 

    Tyler Durden
    Sun, 11/06/2022 – 23:00

  • The Unforgivable Request For Shamnesty
    The Unforgivable Request For Shamnesty

    Authored by Thomas Buckley via ‘The Point’ Substack,

    The morning after is never pleasant… and it shouldn’t be!

    It’s about 11 a.m.  The brain activates but you’re not quite sure you can open your eyes.

    You experience what Homer Simpson described as “that sweet couple of seconds before I remember why I’m sleeping on the lawn.”

    You feel around and breathe a sigh of relief that you are still indoors, slowly open one eye, see your spouse glaring at you and it all floods back.  You had too much fun last night.

    Thoughts race – how much did I…? it couldn’t have been that bad, could it…?  Oh wait, maybe there was that thing…was there?

    You shut your eye while remaining extremely aware of your spouse’s foot tapping menacingly on the bedroom floor, trying desperately to immediately recall the previous evening’s proceedings.  At first, the part of your brain that evolved to ensure self-preservation kicks in and you momentarily convince yourself you were actually rather restrained…

    – but then reality crashes in and you open your eyes again, look down, wonder how that stain got on your tie even before realizing that your wore it to bed,  You put on your most sheepish face, look up, say “Honey, I…” and are immediately cut off by the most disgusted and disappointed “I cannot believe you sometimes!” you have ever heard in your life.

    The next few days are rough – you remain a bit too heavy-footed to properly slink around the house, you hunt for a can of soup because you know with absolute certainty your spouse is not going to be cooking anytime soon, you gobble Advil, and you wonder which is worse – the hangover or the nearly lethal tension hovering in the house.

    After a day or so, you start to work your way back to normal – a bit.  You haven’t really done that before, mostly, you tell yourself it was just a party and – even though you admit to overdoing it – everyone was pretty well lubricated (you finally remember that really off-color joke your neighbor told and you know – you think – you didn’t say anything that bad,) and you vow – to yourself first and only after you have worked out the speech in your head – to your spouse that it will never happen again (even though you both know it very well could.)

    And then – in an effort to get yourself completely off the hook for your bad behavior –  you write an article for The Atlantic entitled “Let’s Declare a Drunken Party Amnesty.”

    And you have the self-satisfied gall of the recently repentant to think “well, that’s over and we should never discuss it ever again because that would be rude of you.”

    That’s not how this works.

    The actions taken by Dr. Emily Oster – who had the astonishing temerity to write the “Let’s Declare a Pandemic Amnesty” piece  and her many many over-credentialed, under-educated power mad brethren over the past 30 months cannot be given a pass.

    What happened during the pandemic was obviously more than a one-off drunken party moment.  Having tee many martoonis does not compare to the whirlwind of destruction the COVID reaction caused.

    Massive educational degradation.  Economic devastation, by both the lockdowns and now the continuing fiscal nightmare plaguing the nation caused by continuing federal over-reaction.  The critical damage to the development of children’s social skills through hyper-masking and fear-mongering.  The obliteration of the public’s trust in institutions due to their incompetence and deceitfulness during the pandemic.  The massive erosion of civil liberties.  The direct hardships caused by vaccination mandates, etc. under the false claim of helping one’s neighbor.  The explosion of the growth of Wall Street built on the destruction of Main Street.  The clear separation of society into two camps – those who could easily prosper during the pandemic and those whose lives were completely upended.  The demonization of anyone daring to ask even basic questions about the efficacy of the response, be it the vaccines themselves, the closure of public schools, the origin of the virus, or the absurdity of the useless public theater that made up much of the program.  The fissures created throughout society and the harm caused by guillotined relationships amongst family and friends.  The slanders and career chaos endured by prominent actual experts (see the Great Barrington Declaration) and just plain reasonable people like Jennifer Sey – https://nypost.com/2022/10/24/former-levis-top-exec-reveals-how-woke-mobs-took-over-corporations/ –  for daring to offer different approaches, approaches – such as focusing on the most vulnerable –  that had been tested and succeeded before. 

    And still a million people died.

    And now Oster asks if everyone would just please move on and forget about it?

    Oster kept her job.  Oster got famous.  The pandemic was good for Oster.

    The pandemic was also good for bureaucrats, multi-nationals, putative experts, the mindless media, and internet scolds.  It was good for woke adults who want to remain children, it was good for the national security-industrial complex, it was good for hiding behind, it was good for expanding societal power.

    It was not good for people.

    There are other aspects to consider when mulling over the request as well.

    • First, this amnesty idea was wholly predictable, though when I did so I assumed it would entail at least a modicum of shame – see here:

    • Second, the politics – for the Democrats –  of the request are incredibly stupid.  Placing the misery of the pandemic front and center a week before the mid-term election is beyond a bad idea and is only made the more amazing – and offensive – that it was done purposefully and in the context of demanding a free pass.  The fearlessly narcissistic arrogance of the bubble people knows no bounds – see here:

    • Third, as for the “we really didn’t know but we meant well so we’re all good, right?” aspect of the argument, that is a repellent lie.  Oster and her merry band of pandemicists knew full well (at least after the first few months) exactly what was happening, exactly the collateral damage being caused was and still actively decided to continue to push the false and destructive narrative of the response.  It strongly appears that the reason for the aggressive ignorance was wholly about power, fame, money, societal purchase, doubling down on mistakes so as not to have to admit error, and buying into (and burnishing) their own image as the nation’s saviors.

    It cannot be forgotten that until this moment  – except for Fauci, due to his deadly bungling of the emergence of AIDS – 99 percent of the people who suddenly, like Oster, became experts and got to be on television and publicly worshiped and given real actual power for the first time in their lives were – outside of their narrow fields – utter nobodies.  Being the all-praised, almighty center of attention feels good and that is a feeling you will do anything to keep going.

    Just the mind-warping act of asking for amnesty shows that nothing has been learned by Oster and her ilk and they will, if given the chance, do it all again exactly they way they did it this time.

    Amnesty is pretending something never happened – this episode in our history must never be forgotten if we are to preserve our nation.

    Amnesty will not – it cannot – be given. 

    And please do not ask again.

    *  *  *

    The Point is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.

    Tyler Durden
    Sun, 11/06/2022 – 22:30

  • Biden Admits The Truth: "No More Oil Drilling" As Energy Stocks Set To Soar
    Biden Admits The Truth: “No More Oil Drilling” As Energy Stocks Set To Soar

    It has been a great year for energy stocks as the chart below clearly reveals…

    … and it will be an even better year (and decade) for energy stocks.

    Why? Not because of what Goldman trader Michael Sullivan wrote last week explaining why Energy has (finally) become everyone’s favorite sector (more than two years after we first told our readers to go balls to the wall long XOM):

    “Energy continues to lead. When oil is up. When oil is down. When yields are up, or when they are down. When the US is threatening Windfall Profits Taxes or considering limits on product exports. Whether the market is hiding in defensives or shifting to more offensive positioning … maybe energy equities are leading because the market sees a pretty good set-up for oil: (1) US SPR release rate is slowing; (2) EU sanctions on Russian sea borne crude are expected to start in Dec; (3) we are passing peak refining maintenance and at the onset of winter — both of which should drive a sequential increase in demand; (4) distillate inventories are extremely low and subject to upside risks, link; (5) a Fed pivot would likely support inflows into commodities — implying a weaker dollar — every 10% move in the dollar is about 300k/d to oil demand on an annual basis.”

    It’s not because of what One River CIO Eric Peters wrote in his latest weekend note:

    “The UN forecasts that world population will pass eight billion next week,” said the energy executive. “One billion of us lack proper access to energy,” she continued. “And we are currently consuming 100mm barrels of oil per day.” That is double what it was 50yrs ago (still rising 1.5% per year). The IEA predicts consumption of 125mm barrels per day by mid-century if the current mix of policies continues. “India’s population will surpass China’s next year,” she said. India GDP per capita is $2,500 (China is $14,340). India is striving to catch up. “In the decades ahead, 90% of the world population will demand more energy.”

    It’s because of what Joe Biden let slip just two days before the midterms, namely what everyone always knew would be the pinnacle of catastrophic US energy policy under the democrats: “no more drilling”

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

    As Michael Shellenberger so poignantly noted, for months, President Joe Biden and members of his cabinet have claimed that they are no obstacle to expanded oil and gas production in the United States.

    On June 21 Biden said, “This idea that they don’t have oil to drill and to bring up is simply not true. This piece of the Republicans talking about Biden shutting down fields is wrong.”

    On June 22, Biden said, I know my Republican friends claim, we’re not producing enough oil and I’m limiting oil production. Quite frankly, that’s nonsense.”

    And on November 2, Energy Secretary Jennifer Granholm tweeted, “Disinfo about @POTUS’ energy agenda is being used to scare/mislead Americans while industry cashes in. The facts are clear: This Admin outpaced the previous Admin on crude oil production + oil/gas well approvals while also making historic investments in a clean energy transition.”

    But tonight, Biden has effectively admitted that he, Energy Secretary Granholm, and others in his administration have been lying. 

    I have documented the lies Biden has told about his energy policy for the last five months. Others have as well. The Wall Street Journal reported in September that Biden had leased fewer acres of public land and waters offshore for oil and gas drilling than any other administration since World War II.

    Granholm tweeted out a Politico article that noted that Biden administration regulators approved oil and gas wells more quickly than the Trump administration did during its first 21 months in office.

    But the story was misleading because those approvals were entirely for drilling on private and state land, which are outside of the administration’s control, something Politico acknowledged 12 paragraphs into its article.

    Biden’s quote, which is on par with his “outrageous” coal plant closure comments, hardly needs more commentary but we will note that it comes just days after the White House unveiled its “brilliantly cunning” plan of promising energy execs that it would buy all the oil they had to sell at $72 to refill the SPR that Biden single-handedly drained to crush US energy companies. Maybe the same oil execs will be just a little skeptical when it comes to anything that comes out of this old man’s mouth going forward.

    Tyler Durden
    Sun, 11/06/2022 – 22:00

  • "It's Not Looking Good" – Martin Armstrong Warns There May Not Be A 2024 Election
    “It’s Not Looking Good” – Martin Armstrong Warns There May Not Be A 2024 Election

    Via Greg Hunter’s USAWatchdog.com,

    Legendary financial and geopolitical cycle analyst Martin Armstrong says, “The cheating in the midterm election next week is going to be so great that it is almost impossible to make a prediction. . . . In a fair midterm election, the Republicans would win the House and the Senate.”

    So, what does his Socrates program see for next week?  Armstrong, says, “It’s going to be tight, and the Republicans have a shot at taking the House.  Technically, they should take the House and the Senate.  I am just not sure.  The corruption is so bad, it’s crazy. ..”

    “Pennsylvania sent out hundreds of thousands of ballots to people who are not documented or even American.  I’ve gotten emails from people in Canada, they are getting mail-in ballots.  They mailed them to Canada…

    Where this ends up, who knows?  It’s just so corrupt, it is over the top.  It doesn’t matter who wins.  Nobody is going to accept this thing, and that is the problem.”

    The cheating is going to be so in your face President Trump may not even be able to run for President two years from now.  Armstrong contends, “We may not even have an election in 2024…”

    “It is not looking very good, and it’s probably because this election is not going to be accepted. 

    When it is so over-the-top corrupt, what do you do for the next one? 

    The United States will not exist after 2032.  After 2028 and 2029, we are going to have to redesign a government from scratch.  America is being destroyed. 

    Republics always end in absolute corruption.  We just saw the same thing happen in Brazil.  They staged a major effort to take Bolsonaro out…

    This is a worldwide effort.  They had to get rid of Trump.  The other one who stood in their way is Bolsonaro.  Then there is Putin (Russia) and Xi Jinping (China).  I think you are going to have historians look back at this 50 years from now, and they will call this period ‘The Climate Change Wars’…

    They are trying to take down as much oil energy capacity as possible.”

    Armstrong is still seeing very strong signals on domestic violence everywhere.  Armstrong explains, “Our computer is showing it’s going to be a rocket launch for volatility and civil unrest next year.”

    Armstrong also contends there will be a major loss of confidence in government around the world.  That means gold will start having big demand from big money.  Armstrong also predicts,

    “The whole monetary system as we know it is collapsing.  That was what the bond crisis in the UK was about.”

    There is much more in the 1-hour and 7-minute interview for 11.5.22.

    Join Greg Hunter of USAWatchdog.com as he goes One-on-One with Martin Armstrong, cycle expert and author of the new book “The Plot to Seize Russia, Manufacturing World War III.” Armstrong is giving the book away if you attend in-person the “2022 World Economic Conference” in Orlando, FL, next weekend.

    To Donate to USAWatchdog.com Click Here

    There is some free information, analysis and articles on ArmstrongEconomics.com. Armstrong’s book, “The Plot to Seize Russia, Manufacturing World War III,” will be given away if you sign up for the “In-Person” conference below.  There will be a book buying link posted soon on ArmstrongEconomics.com, so be on the lookout for it. For tickets to Armstrong’s “2022 World Economic Conference” in Orlando, FL, November 11, 12, and 13, click here.

    Tyler Durden
    Sun, 11/06/2022 – 21:30

  • Hedge Fund CIO: "My Best Guess Is That Something Like $300/Barrel Oil Eventually Ends This Cycle"
    Hedge Fund CIO: “My Best Guess Is That Something Like $300/Barrel Oil Eventually Ends This Cycle”

    By Eric Peters, CIO of One River Asset Management

    “Wanna know what would make Biggie’s job easy?” barked Biggie Too, slipping into 3rd person like a warm bath. “On Valentine’s Day, non-farm payrolls is -250k, unemployment is above 4%, Powell says enough is enough, the S&P 500 troughs at 3300, and up we go,” bellowed Biggie, Chief Global Strategist for one of Wall Street’s Too-Big-To-Fail affairs. “The end of the bear market gets given to Biggie, wrapped up in a red bow.” Then Biggie went quiet. Agitating himself. “But Biggie doesn’t get gifts. Not for Valentine’s Day. Not for Christmas. Biggie doesn’t even get damn birthday cards.”

    “Biggie is not going to get a signal we got a big low,” said Too. “Biggie is going to get a continuation of a series of lows next year, and it’s going be horrible, just horrible,” he said, not sounding terribly upset about it if I’m being honest. “And somewhere in the middle of it, something is going to break. It always does. Always.” We’ve seen the warning signs bubbling up. The UK pension LDI debacle. “You don’t hike rates this fast and not break something big. It’s coming,” said Biggie. “And listen, you’ll know when to trade the Fed pivot. It’ll be after everyone has given up on the Fed pivot.”  

    MMT

    “The Fed and almost everyone else misunderstands how interest rates affect the economy,” said Warren Mosler, father of MMT. “Higher rates increase interest payments on gov’t debt, and these dollars get pumped into the economy,” he said. US GDP is roughly $25trln. US national debt held by the public is currently $24trln. If the average interest rate on this debt is 1%, the gov’t will pay $240bln in interest. If overnight rates stay high and the average rate on our debt stock rises to 4%, the government will pay $1trln per year. That’s ~4% of GDP.

    “The gov’t currently increases the deficit to pay interest on its debt, so higher interest rates increase the deficit and money in the system, and this lifts inflation,” continued Mossler. “If a gov’t wants to reduce demand, which I’m not saying is the problem, it should cut interest rates to 0% (keep them there forever), raise taxes, and/or cut federal spending. Lifting interest rates is the opposite of what it should do,” he said. “And raising rates pays interest only to the people in society who already have assets. It is the equivalent of Universal Basic Income for rich people.”

    “The rate hikes have sustained earnings but shifted them from the high multiple stocks into low multiple names,” explained Mosler. “The effect is a one-time decline in overall market capitalization for stocks as a whole, but once we adjust to this shift, the market heads higher to reflect the rising inflation brought on by the Fed,” he said. “Stocks will then be a good inflation hedge until something breaks.” In each cycle, something snaps. “You never know what it will be, but my best guess is that something like $300/barrel oil eventually ends this cycle.”

    “As for policy rates, it looks like the Fed will get rates to 5% or so,” said Mosler. “Inflation bumps around between 3%-6%,” he said.  “The federal deficit moves up toward 8%. Interest costs are quickly going to 3% of that and then headed higher still. Nominal GDP is probably in the range of 5%-6%,” said Mosler. “The rising amounts of money flowing into the economy from deficit spending, including things like student loan forgiveness, 8%-9% social security inflation adjustments, and infrastructure spending keeps inflation and nominal growth high. And stocks like nominal growth.” 

    Tyler Durden
    Sun, 11/06/2022 – 20:30

  • Apple Cuts Outlook For iPhone Shipments Again, This Time Due To Chinese Lockdowns
    Apple Cuts Outlook For iPhone Shipments Again, This Time Due To Chinese Lockdowns

    For the 2nd time in the past month, and just days after its “not all that bad” earnings presentation which helped AAPL be the only GAMMA stock not to tank after reporting Q3 earnings, late on Sunday Apple said shipments of its newest premium iPhones will be lower than previously expected after China lockdowns affected operations at a supplier’s factory.

    In a brief, tersely worded statement, Apple said that it continues to see strong demand for the iPhone 14 Pro and iPhone 14 Pro Max models but the neverending Chinese lockdowns – which have long ago become just a scapegoat for the Chinese economic implosion – mean “customers will experience longer wait times to receive their new products.” Also, on its website, the company said that deliveries of iPhone 14 Pro handsets are currently listed for late November or early December.

    Here is the full statement…

    COVID-19 restrictions have temporarily impacted the primary iPhone 14 Pro and iPhone 14 Pro Max assembly facility located in Zhengzhou, China. The facility is currently operating at significantly reduced capacity. As we have done throughout the COVID-19 pandemic, we are prioritizing the health and safety of the workers in our supply chain.

    We continue to see strong demand for iPhone 14 Pro and iPhone 14 Pro Max models. However, we now expect lower iPhone 14 Pro and iPhone 14 Pro Max shipments than we previously anticipated and customers will experience longer wait times to receive their new products.

    We are working closely with our supplier to return to normal production levels while ensuring the health and safety of every worker.

    … which company shareholders will wonder why none of this was discussed a little over a week ago when the company reported earnings; to be sure, there was zero mentions of China issues on the earnings call yet anyone following the company knew that it would have to guide down in the future. The only surprise is that the future was just one week later.

    Commenting on the release, Knowledge Vital’s Adam Crisafuli said that it was “so vague it almost makes us think the main intended audience was the Chinese government, not investors .. an indirect way for them to express their displeasure with the lack of change.”  Then again, we doubt China cares what Apple thinks.

    The abrupt move by the Chinese government last Wednesday to lock down the Zhengzhou area that includes a Hon Hai Precision Industry iPhone assembly plant until Nov. 9 is expected to further disrupt a factory already grappling with an on-site coronavirus outbreak, worker exodus and enforced quarantine.

    Apple said the facility is operating at “significantly reduced capacity,” while Hon Hai, the main listed arm of Taiwan’s Foxconn Technology Group, noted in a separate statement that it’s lowering its fourth-quarter outlook to factor in the lockdown.

    “Foxconn is now working with the government in concerted effort to stamp out the pandemic and resume production to its full capacity as quickly as possible,” the Taiwanese company said in a statement.

    In the latest Chinese covid-linked hysteria, the local government has ordered people and vehicles off the streets except for medical or other essential reasons, a prohibition that threatens to cut off the flow of additional workers and components needed to rev up production ahead of the holiday-season crush.

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    The disruption comes at a crucial time for Apple, which launched the iPhone 14 during an unprecedented slump in global electronics demand. While faring better than other smartphone makers, it’s backed off plans to increase production of its new iPhones this year after an anticipated surge in demand failed to materialize, Bloomberg reported previously. Apple reported better-than-expected results but warned of a holiday slowdown.

    As Bloomberg reminds us, Apple didn’t provide a specific revenue forecast for the current quarter, continuing an approach it adopted at the start of the Covid-19 pandemic. But analysts estimate sales of about $128 billion, which would be an all-time record. That forecast is now in serious jeopardy, and futures have reacted appropriately, with Eminis sliding as much as 1.1% in early trading but have since made up nearly half the initial drop.

    Unlike Facebook and Twitter, Apple has yet to unveil major layoffs. Instead, in the face of slowing growth, Apple has paused hiring for many jobs outside of research and development, an extension of its current plan to reduce budgets heading into next year.

    Meanwhile, Foxconn’s plant continues to operate within a “closed loop,” or a self-contained bubble that limits contact with the outside world. That is keeping some production going. Apple said on Sunday it is working closely with its supplier to return to “normal production levels while ensuring the health and safety of every worker.”

    Tyler Durden
    Sun, 11/06/2022 – 20:00

  • "The Political Pressure On Powell Has Started With Unemployment Rising Just 0.2% To 3.7%"
    “The Political Pressure On Powell Has Started With Unemployment Rising Just 0.2% To 3.7%”

    By Eric Peters, CIO of One River Asset Management

    “I am deeply troubled by the Federal Reserve’s rapid series of super-sized interest rate hikes, which may inflict unnecessary pain on millions of individuals and families while sending the economy into a devastating recession,” wrote Chairwoman of the House Financial Services Committee in a public letter to Fed Chairman Powell.

    “This week’s Federal Open Market Committee decision marks the fourth consecutive mega rate hike by the Fed, resulting in the highest federal funds rate since before the 2008 global financial crisis and the fastest set of rate hikes by the Fed in four decades. Enough is enough,” continued Maxine Waters.

    And this level of political pressure has started with unemployment rising just 0.2% to 3.7%.

    * * *

    “The last thing I’ll say is that I would want people to understand our commitment to getting this done and to not making the mistake of not doing enough or the mistake of withdrawing our strong policy and doing that too soon,” said America’s central bank chief, speaking to journalists, having just hiked interest rates another 75bps.

    “I control those messages,” explained Jay Powell.

    “That’s my job.”

    And indeed, it is. In 1977, Congress set the Federal Reserve’s goals: maximum employment, stable prices, and moderate long-term interest rates.

    Our politicians did not tell central bankers how to achieve these goals. Neither did they quantify how much short-term pain they would be willing to bear in the pursuit of this mandate, nor did they make clear over what time horizon they would measure success.

    And naturally, in such an infinitely complex system, there is no singular way to achieve these sensible goals. So, we appoint central bankers we believe will have the judgement required to navigate the labyrinth. But of course, the maze is always changing. So the Fed strategies must adapt to our present circumstances.

    What worked during globalization and peace is now largely obsolete. That’s obvious. But what is not yet clear is how the actions of our central bankers and politicians are eroding our collective faith in the value of money.  In recent decades, central bankers and politicians grew increasingly aggressive in rescuing speculators from financial folly. Then Covid happened. And they created more money than anyone could possibly imagine. Presto. Magic. Everyone got something.

    Now we’re forgiving student debt. Newsweek just reported 63% of Americans support federal inflation relief payments. This is before politicians fund vital projects in the decade ahead: military, infrastructure, environment, inequality.

    And now Powell’s job is to navigate a labyrinth, unlike any in American history, in a quest to restore meaning to money.

    Tyler Durden
    Sun, 11/06/2022 – 19:30

  • PTSD-Stricken Progressives Flee Austin Over "Too Many Republicans"
    PTSD-Stricken Progressives Flee Austin Over “Too Many Republicans”

    Progressives who have descended upon Austin, Texas in recent years are starting to reverse course amid a state-wide shift towards conservatism, NY Mag reports.

    “It was easy to just be in Never Neverland, floating with a bunch of other transplants having a good time,” said John Stettin, who relocated from Dallas to Austin five years ago and is now leaving for Massachusetts because of ‘too many Republicans,’ as one friend described the situation during Stettin’s going-away party.

    Austin has been a predominantly Democratic city full of ‘liberal expats’ who seek progressive politics and an urban lifestyle ‘at a red-state cost-of-living discount,’ according to the report.

    Then the pandemic hit – and mean Governor Greg Abbott banned municipalities – including Austin – from implementing various COVID measures, such as mask mandates. Then, Abbott codified permitless carry into law and, according to liberals, ‘further restricted voting access.’

    Then, this past February, Abbott ordered child abuse investigations into parents of trans children – who, according to the report, began fleeing texas months ago.

    “I’ve always said, ‘I’m gonna stay and fight until they try to take my kids away,;” said ‘Karen’ (name withheld), who has a trans child and says she did not want to risk being separated from her children. Karen has ‘fled from Austin to Portland, Oregon,’ causing her Republican father to ‘burst into tears.’

    Karen says she has PTSD and survivor’s guilt for not staying behind.

    By June, when the Supreme Court overturned Roe v. Wade, Texas was 10 months into implementing an abortion ban with no exceptions for rape or incest, and a $10,000 reward for informants.

    The overturning of Roe seemed to remove the last obstacle in the state’s march to the far right, which is likely to be cemented in the upcoming election where Beto O’Rourke is way behind Abbott. While the Democratic mayor and the liberal city council institute token measures such as decriminalizing abortion, it’s cold comfort. One 25-year-old woman said she had her tubes tied, fearing the consequences of an unwanted pregnancy. One couple may relocate to the Northeast to carry out their pregnancy. Some job candidates are refusing to relocate. At Stettin’s party, his friend Jeff swiped open his phone to a note entitled “New Austin Cities” — a list of places that are what Austin used to be to him before he moved here from New York. It read, “Pittsburgh, Durham, Boise, Columbus, Jackson Hole, Chattanooga. Factors: Climate change, demographics, economy, location, taxes, nature, weather.” He plans to stick it out at least for now. “Global warming in the next ten years,” he said. “That’s gonna be fucking real.” -NY Mag

    “It’s like how a frog boils one degree at a time,” said Stettin. “They trigger-banned all abortion and they’re offering a bounty! What more do you need if you are a remotely liberal person to get the fuck out of here?”

    “At least if I’m going to get into an argument with a guy in Boston, he’s probably not carrying an AR-15 in his trunk,” he said, referring to his upcoming move.

    Good call John?

    That said, while liberals are leaving Austin, it was ranked the fastest-growing metro in the US in February, which has seen its population grow by 33% over the past decade thanks to the draw of ‘hippie-cowboy capital’ tech jobs.

    In the past year, rents in Austin have soared over 20%, while the media home price rose around the same percent over the same period, with companies such as Tesla acting as a primary driver of migration with the construction of a $1.1 billion “gigafactory” nearby.

    If you thought the blue exodus was big now, just wait until after midterms…

    Tyler Durden
    Sun, 11/06/2022 – 19:00

  • National Guard Cybersecurity Units Activated In 14 States Ahead Of Midterm Elections: Reports
    National Guard Cybersecurity Units Activated In 14 States Ahead Of Midterm Elections: Reports

    Authored by Mimi Nguyen Ly via The Epoch Times,

    Cybersecurity units from the National Guard will be activated in 14 U.S. states to help counter any threats to election officials’ networks ahead of, during, and after the upcoming Nov. 8 midterm elections, according to reports.

    The 14 include battleground states Arizona, Iowa, and Pennsylvania, as well as Colorado, Connecticut, Delaware, Hawaii, Illinois, Louisiana, North Carolina, New Mexico, New York, Washington, and West Virginia, reported Politico.

    Brig. Gen. Gent Welsh, the commander of the Washington Air National Guard, said at a virtual media briefing on Nov. 4 that not every state is doing it but states that are activating these units “have invested in cyber talent and cyber missions for years,” according to outlet Statescoop, which reports on technology-related news in government.

    “If you don’t have a cyber unit in your state you’re not in a good position to help them protect elections,” Welsh said.

    He added that the National Guard’s participation in election cybersecurity activities “does add an air of credibility to what’s out there,” noting that the National Guard “is still one of the most trusted institutions in the United States.”

    ‘As Secure Elections as Possible’

    The plan comes after eight states received support from cyber units in the National Guard during the primary elections that took place earlier this year.

    According to the outlets, there are 38 dedicated cyber units within the Air and Army National Guard across the United States that work to help state and local officials on cyber-related issues such as network assessments and risk mitigation. The cyber units collectively comprise over 2,200 personnel.

    “Our goal is to make sure we have as secure elections as possible. We are at the really beginning stages of this,” said Air Force Maj. Gen. Rich Neely, head of the Illinois National Guard, reported Statescoop.

    National Guard officials will receive security updates from the Cybersecurity and Infrastructure Security Agency (CISA) in their work to support the midterms, Politico reported.

    According to its website, CISA was created in 2018 under the Trump administration to work with government and industry partners to defend against current and predicted threats to cyber and physical infrastructure, including election infrastructure.

    No Indication of Potential Election Infrastructure Disruption: CISA Director

    CISA Director Jen Easterly has repeatedly said she doesn’t expect any major disruptions to the midterms. Most recently, on Nov. 1, at an event hosted by the Center for Strategic and International Studies, Easterly said that there is “no information credible or specific about efforts to disrupt or compromise” election infrastructure and that she was “very confident that we have done everything we can to make election infrastructure as secure and as resilient as possible.”

    Air Force Maj. Gen. Rich Neely, head of the Illinois National Guard, said that he and his team are “not expecting to see anything.”

    “But much like we did after Jan. 6, if the Guard’s called in, the Guard responds as needed,” he said, reported Statescoop.

    “We’re not expecting anything with what we’re seeing.”

    Army Major General M. Todd Hunt, the adjutant general of the North Carolina National Guard, said at the media briefing on Nov. 4 that his state has a joint cyber mission center that will facilitate communication between the state’s cyber unit, its departments of Information Technology and Emergency Management, as well as federal contacts from CISA, the Department of Homeland Security, and the FBI.

    According to the outlets, Hunt said there will be 25 National Guard members on duty in the cyber unit for North Carolina on Election Day, up from the usual core team of 10. The extra members will include federal and emergency management partners.

    “We will surge during the election to ensure that we have 24-hour coverage throughout this whole process,” Hunt said, per Politico. “We are citizen soldiers, we live in this state, and we do have a vested interest in our state elections as well as our federal elections.”

    Tyler Durden
    Sun, 11/06/2022 – 18:30

  • "I'm Selling My Blood To Eat, I Have No Choice": Biden Inflation Crushes Americans
    “I’m Selling My Blood To Eat, I Have No Choice”: Biden Inflation Crushes Americans

    Gas, groceries, electricity, and rent — the price of everything has soared to four-decade highs under the Biden administration. Household finances are under severe pressure as wage growth fails to outpace inflation for 18 months, leading many folks to find a second job. Even holding two jobs isn’t enough to sustain the cost-of-living crisis, as some are finding the nearest plasma clinic to donate blood to earn extra cash. 

    Cashe Lewis, 31, of Denver, Colorado, works multiple jobs and is trying to find a third job due to rising shelter inflation. She told The Guardian she works six days a week, sometimes more than 16 hours per day, just to pay the bills. 

    “I’m exhausted all the time … on the one day I have off a week, I donate plasma for extra money. I’m literally selling my blood to eat because I have no choice,” Lewis said. 

    She said many of her “friends and family work multiple jobs” as inflation makes “nothing affordable and the roadblocks set up to keep people in the cycle of poverty benefit the most wealthy members of our society.” 

    Lewis said: “We aren’t living, we’re barely surviving, and we have no choice but to keep doing it.”

    More Americans than ever are working multiple jobs as inflation wipes out real wage growth.

    Real wage growth has been negative for 18 consecutive months. 

    The personal savings rate has tumbled to multi-decade lows at 3.1%, just shy of the record low of 3.0%…

    And some experts are concerned about the pace of growth in consumer credit as debt loads for households soar as their wages can’t cover added costs of food, shelter, and energy. 

    But according to MSNBC’s Joy Reid, her latest comments claim that Americans were oblivious to inflation until conservative political candidates started talking about it.

    Reid’s suggestion insinuates that the public was comfortably unaware of the inflationary/stagflationary crisis and could have stayed that way had it not been for those meddling Republicans and their refusal to use the “common tongue” on the campaign trail. In other words, she believes the average voter is stupid.

    Voters aren’t stupid, and they’re going to vote with their depleted wallets on Tuesday. A recent poll found that most Americans (over 90%) now rate inflation and the economic decline as their top worry going into the midterm elections. 

    And it’s not just Lewis who has sold her blood plasma to feed her family. Many others like her are scouring the internet for where they can donate plasma for money. 

    Over the summer, Fox 35 Orlando published a story titled “More people donating plasma to earn extra money amid inflation, rising costs.” They interviewed Dan Hernandez, the director of Octapharma Plasma in Orlando, who said, “We have countless people coming into our facilities saying it’s really hard to make ends meet.” 

    Hernandez said the number of people donating has doubled in the last year, coinciding with the inflation spike in the economy. 

    “Inflation. Everybody who comes here obviously they talk to us, and they tell us that it’s difficult to make ends meet,” he said.

    The general public knows that working multiple jobs, barely affording to live while making frequent stops at the plasma clinic just to put food on the table isn’t normal. At least polling data shows many are awakening to Biden’s failed policies have made their lives worse. 

    Tyler Durden
    Sun, 11/06/2022 – 18:00

  • What We Knew In The Early Days Of COVID
    What We Knew In The Early Days Of COVID

    Via The Brownstone Institute,

    The claim is now everywhere:

    • We had to lock down because we just didn’t know about this virus.

    • It was all very confusing and we had to play it safe.

    • We had no other option because we just had no clarity about what we were dealing with.

    • The precautionary principle dictated the unprecedented actions. 

    Actually, the precautionary principle goes both directions.

    It also dictates that we not enact policies that we know for sure would wreck lives and liberties. They did it anyway, without sufficient knowledge that the measures would achieve any positive good. 

    We approach the third year and people have forgotten that all the harms of lockdowns were strongly warned about by many voices in many venues. In addition, the virus was much better understood back then and openly discussed. We knew for certain that the panic and fear were being wildly overblown.

    Below follows resources assembled by the ‘Robber Baron‘ and many others who write for the Brownstone Institute. These citations from newspapers, magazines, academic journals and interviews, with many respected voices, show that we certainly knew tremendous amounts in the early days.

    All the warnings and information were readily available to anyone paying attention.

    We certainly live in an age of short attention span but many these signs and warnings came weeks or months before the world locked down and they chronicled the damage as it was happening.

    Why all this came to be completely ignored remains the burning question. 

    Tyler Durden
    Sun, 11/06/2022 – 17:30

  • Meta Reportedly Readying To Fire 1000s This Week
    Meta Reportedly Readying To Fire 1000s This Week

    Just over a week ago, Meta CFO Dave Wehner confidently stated that the not-so-giant tech firm will basically freeze headcount and limit new hiring…

    Our pace of hiring slowed in the third quarter, consistent with our previously-stated plans. We added 3,700 net new hires in Q3, down from our Q2 net additions of 5,700 despite Q3 typically being a seasonally stronger hiring period. We expect hiring to slow dramatically going forward and to hold headcount roughly flat next year relative to current levels…

    We are making significant changes across the board to operate more efficiently. We are holding some teams flat in terms of headcount, shrinking others and investing headcount growth only in our highest priorities. As a result, we expect headcount at the end of 2023 will be approximately in-line with third quarter 2022 levels.

    At the time, we were a little surprised (given the scale of the losses)…

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    With the shares down 36% since then (and is down over 70% this year), something has apparently changed extremely fast.

    The Wall Street Journal reports that, according to people familiar with the matter, Meta is planning to begin large-scale layoffs this week.

    As of the last earnings, Meta had over 87,000 employees (and has never seen a quarterly decline in headcount in its 18 year history)…

    The WSJ sources say that layoffs are expected to affect many thousands of employees and an announcement is planned to come as soon as Wednesday, with company officials having already told employees to cancel non-essential travel beginning this week.

    While smaller on a percentage basis than the cuts at Twitter Inc. this past week, which hit about half of that company’s staff, the number of Meta employees expected to lose their jobs could be the largest to date at a major technology corporation in a year that has seen a tech industry retrenchment.

    Meta is far from alone…

    Infographic: Mass Tech Layoff Wave Rises Again | Statista

    You will find more infographics at Statista

    As a reminder, CEO Mark Zuckerberg told employees at a companywide meeting at the end of June:

    “Realistically, there are probably a bunch of people at the company who shouldn’t be here.”

    It seems he has found his people.

    None of this should come as a surprise to ZeroHedge readers since we have been warning of a post-Midterm collapse in payrolls.

    Everything had to be held together ahead of the election in the “strong as hell” economy...

    But then…

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    …and given the letters from various high-ranking Democratic Party officials, we know who the scapegoat for this collapse will be…

    But what happens next to Zuck?

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    Given the outcry at Elon Musk’s decision to cut ‘less productive’ Twitter employees (while losing millions every day), we wonder how long before those that #LearnedToCode will need to transition and #LearnToBarista and their voting bloc will turn on one of their greatest funders.

    Tyler Durden
    Sun, 11/06/2022 – 17:00

  • "When True Democracy Goes Away, People Get Hurt": Obama Joins Mantra That Democracy Is At Risk If GOP Wins
    “When True Democracy Goes Away, People Get Hurt”: Obama Joins Mantra That Democracy Is At Risk If GOP Wins

    Authored by Jonathan Turley,

    Former President Barack Obama continued the Democratic campaign theme this week in arguing that democracy is in danger if Republicans prevail in the midterm elections. I have a new column out this weekend addressing the over-the-top rhetoric coming from Democratic politicians and pundits. However, the former president’s speech was revealing as he cited the very arguments made by Democrats  . . . as attacks on democracy.  Obama did not go as far as some but he also seemed to channel the dire warnings of the imminent collapse of our democracy if the Republicans should prevail in the elections.

    Obama remains one of the most impressive speakers of our time. With the unpopularity of President Joe Biden, candidates are relying heavily on Obama for good reason. His standard stump speech is still heads and shoulders above most other politicians.

    Yet, the speech below was notable in the arguments that Obama warns voters not to heed.

    “I understand that democracy might not seem like a top priority right now. Especially when it doesn’t seem like the results always work for you. When you don’t see enough progress on issues that matter to you and your family. Sometimes progress is slow. But we have seen throughout history and we’re seeing right now what happens when you give up on democracy.”

    It was a curious argument given the effort of many in the party to pack the Supreme Court and push censorship on social media.

    Sen. Elizabeth Warren, D-Mass, has declared the Supreme Court illegitimate and has called to pack the Court for rending opinions against “widely held public opinion.”

    Rep. Alexandria Ocasio-Cortez, D-N.Y., even questioned the institution’s value: “How much does the current structure benefit us? And I don’t think it does.” She has now demanded the impeachment of Justices Kavanaugh and Gorsuch based on the entirely false claim that they lied under oath in their confirmation hearings. After the Dobbs decision, Ocasio-Cortez demanded “there must be consequences” for the Court.

    Elie Mystal (past writer for Above the Law and the Nation) called the Constitution “trash.” Some law professors want to “reclaim America from Constitutionalism.”

    Obama added that you see the threat to democracy “in countries where the government tells you what books you can and cannot read.” Yet, many on the left are seeking to preserve censorship by surrogate on social media and seeking to prevent the publication of books by those with whom they disagree, including a book by Supreme Court Justice Amy Coney Barrett. With corporate censorship threatened, many leaders like Hillary Clinton are turning to good old-fashioned state censorship.

    Indeed, President Joe Biden has questioned how citizens will know the truth without censors framing what the truth is on social media and the Internet.

    Obama ended this discussion with the same ominous warnings heard from other Democratic politicians and pundits:  “when true democracy goes away, people get hurt.”

    Various pundits have been pushing the vote-Democratic-or-die mantra. On MSNBC, historian Michael Beschloss on MSNBC declared a Republican win could lead not only to the end of history books and democracy but lead to the killing of our children. That was then followed by another MSNBC interview with actor and Director Rob Reiner who claimed that Republicans “are willing to kill, literally kill, to get the power . . .  this might be the last election we have in a democracy.”

    It is language that is not just demagoguery but dangerous. It is meant to spread fear in citizens and make them believe that our constitutional system is about to fail. We have the most successful constitutional system in the history of the world. It has weathered every storm and will weather our current political divisions. What kills democracy are self-inflicted wounds caused by those who cast doubts about our safety or demonize their opponents as enemies of the state.

    Tyler Durden
    Sun, 11/06/2022 – 16:30

  • Morgan Stanley's 3 Keys Takeaways For Investors From Election Week In America
    Morgan Stanley’s 3 Keys Takeaways For Investors From Election Week In America

    By Michael Zezas and Seth Carpenter, strategists at Morgan Stanley

    On Tuesday, Americans will cast their ballot for members of Congress. Well…most Americans will. Many will have already voted by mail, meaning that, as in 2020, investors may have to wait days to know with certainty who will control Congress. Given the axiom that markets hate uncertainty, here are our three key takeaways to help investors to cope with the lack of clarity that election week in America will bring:

    1. Concerned about near-term market volatility? Higher volatility more likely results from a better-than-expected night for Democrats than for Republicans. Outcomes that meet expectations typically do not move markets a lot. And judging from recent levels and trends in both polls and prediction markets, Republicans are expected to win a majority in at least one chamber of Congress. Against that backdrop, it is important to note that we do not see a Republican win as leading to policies that on their own would be important market catalysts in any direction. Conversely, Democrats’ expanding their majorities in Congress would buck the expectations set by polls and prediction markets. That outcome would also undercut the notion that inflation is an electoral liability for the Democrats. Investors could see this result as freeing the party from the political and legislative constraints that kept Congress from enacting some of the fiscally expansionary policies that were part of President Biden’s original ‘Build Back Better’ agenda. Hence, markets could assign a higher probability to further fiscal expansion, with Congress and the Fed effectively pulling in opposite directions on inflation. The short-term implications for markets could be higher Treasury yields and a stronger dollar, reflecting the potential for a higher peak federal funds rate.

    2. A Republican ‘win’ may not create near-term market volatility, but does introduce situational risks for 2023. Benign neglect is often the outcome for a split government in the US, but not always. Following the 2010 midterm elections, gridlock led to protracted debt limit standoffs and government shutdowns. The resolution to one such standoff was the Budget Control Act of 2011, which implemented contractionary fiscal policy while the economy was still weak. Indeed, when the legislation was passed in August of that year, the unemployment rate stood at 9%. The result was weaker growth and a slower economic recovery, which partially explains why the liftoff of the fed funds rate was delayed until 2015 and unfolded gradually thereafter. At present, Republican leadership is signaling its intent to deploy the same tactics if the party wins majorities. While markets could easily dismiss these negotiations as political theater, as they have in recent years amid solid economic conditions, if the economic outlook sours in 2023 in unexpected ways, the specter of the Budget Control Act could weigh on markets.

    3. Beware premature conclusions on election night. As in 2020, the increased use of vote by mail means the early reported vote tallies may not be a good indicator of who is winning, especially in races expected to be close. What we saw in 2020 and in other elections is that mail-in ballots were cast more often by Democrats than Republicans, and in many jurisdictions were counted after in-person voting. That means early reported results should look favorable to Republicans, but as in 2020, leads can vanish over time. Consider the Pennsylvania Senate race. Assuming mail-in ballots are cast in the same proportions and with the same party skew as they were in 2020, we estimate that the Republican candidate could win the in-person vote by 29% and still lose after all ballots are counted. Hence, we will need to reserve judgement, perhaps for days, on which party seems poised to control Congress. If you’re looking to cut through this noise and assess whether early results are consistent with a good outcome for Democrats or Republicans, check out our ‘Blue Shift’ interactive tool.

    And as always, our ultimate piece of advice for those who don’t like political uncertainty…vote!

    Tyler Durden
    Sun, 11/06/2022 – 15:30

  • "I Heard A Big Bang": California Man Believes Meteorite Destroyed His Home
    “I Heard A Big Bang”: California Man Believes Meteorite Destroyed His Home

    On Friday, dozens of people across Northern California witnessed a bright ball of light tumbling from the night sky. Several captured the phenomenon on camera, while one man believes the final destination of that bright light, which could be a meteorite, destroyed his home. 

    “I heard a big bang,” Nevada County resident Dustin Procita told local news KCRA’s Michelle Bandur. 

    Procita said after that loud noise, he “started to smell smoke. I went onto my porch and it was completely engulfed in flames.”

    Bandur spoke with Josh Miller, captain of Penn Valley Fire Department, who said a call came in around 7:30 pm local time for a structure fire. It took firefighters several hours to combat the flames. 

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    “It appears the bright ball of light captured on car and home videos landed in the middle of nowhere. Procita believes it was a meteor that landed on his house,” Bandur said. 

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    Miller told the reporter: “Everyone I talked to said it was a flaming ball falling from the sky and landed in that general area” of Procita’s home. He said those who observed the fireball in the night sky tracked it to the incident area. 

    “I had one individual tell me about it first and I put it in the back of my mind but then more people — 2, 3, 4 — started coming in and talking about it,” he said.

    At the same time, the Southern Taurids meteor shower was at its peak in the region. Miller said it could take at least a week or more to determine the cause of the fire. 

    Wonder if the homeowner has meteorite insurance? 

    Tyler Durden
    Sun, 11/06/2022 – 15:00

  • 5.5 Million Illegal Aliens Crossed US Border Since Biden Took Office: Report
    5.5 Million Illegal Aliens Crossed US Border Since Biden Took Office: Report

    Authored by Tom Ozimek and Steve Lance via The Epoch Times (emphasis ours),

    The total number of people who have entered the United States illegally since President Joe Biden took office has climbed to 5.5 million, according to the Federation for American Immigration Reform (FAIR).

    Venezuelan migrants gesture as they reach the U.S. border fence to turn themselves in to the U.S. Border Patrol after crossing the Rio Grande from Mexico in El Paso, Texas on Sept. 22, 2022. (Joe Raedle/Getty Images)

    Dan Stein, president of FAIR, shared the stark number during a recent interview on NTD’s “Capitol Report” program, which followed a recent announcement by the Biden administration that nearly 2.8 million illegal border crossers were stopped in the fiscal year ended in September, a record high.

    U.S. Customs and Border Protection (CBP) disclosed the figures in a recent operational update that brought the total official number of illegal border crossers to around 4.4 million since Biden took office.

    Stein said FAIR arrived at the 5.5 million figure by adding to the 4.4 million an estimated 1.1 million who managed to evade capture and entered the United States undetected.

    “It’s pretty straightforward,” Stein said of the estimate. “There are typical projections that are confirmed by Census data of people who just run around—they call them ‘gotaways’—who enter without inspection, then disappear.”

    “If you look at the entire period, it’s about 5.5 million since Biden took office,” adding that FAIR projections estimate the cost to taxpayers to be $20 billion.

    Stein blamed the Biden administration for dismantling Trump-era “deterrence strategies” along the border for the surge.

    The White House did not immediately return a request for comment on the figures Stein cited.

    CBP said that a surge in migration from Venezuela, Cuba, and Nicaragua in September brought the number of illegal crossings to the highest level ever recorded in a fiscal year.

    Read more here…

    Tyler Durden
    Sun, 11/06/2022 – 14:30

  • Biden Press Secretary Under Fire For 'Mega MAGA Republican' Comment
    Biden Press Secretary Under Fire For ‘Mega MAGA Republican’ Comment

    A government watchdog group has filed a complaint against White House Press Secretary Karine Jean-Pierre, alleging that she violated the Hatch Act when she made comments about “Mega MAGA Republican” officials.

    In a Nov. 3 complaint, Protect the Public’s Trust (PPT) told the US Office of Special Counsel (OSC) that Jean-Pierre violated the federal law that limits the political activities of federal employees, when she said during a Nov. press conference, “Unfortunately, we have seen mega MAGA Republican officials who don’t believe in the rule of law,” adding “They refuse to accept the results of free and fair elections, and they fan the flames of political violence through what they praise and what they refuse to condemn.”

    PPT director Michael Chamberlain said the comments were “disparaging President Biden’s political opponents,” adding that her statements “were clearly made in her role as an employee of the White House and appear to be political in nature, seeking the defeat of her political opponents in the Republican party in the upcoming general election less than a week away on November 8.”

    As The Epoch Times further notes;

    The watchdog group is asking the OSC to “promptly investigate Ms. Jean-Pierre’s conduct as a potential Hatch Act violation based on her use of her official position to advocate for the defeat of a political party.”

    “We request that you promptly investigate these potential violations and immediately intervene to ensure that the government officials do not abuse their official authority in an attempt to influence the results of the impending 2022 general election.”

    “The comments appear to be clearly designed to influence voters in next week’s election,” Chamberlain said in a separate statement. “A quick and complete investigation into these statements would be a good first step in helping to restore the American public’s trust in its government.”

    PPT in a release said that Jean-Pierre’s statement is an “attempt to sway an election” and is a “direct violation of the Hatch Act’s prohibition” against government employees using their office to influence an election.

    The group alleges that her statement cannot be attributed to “an insufficient knowledge of the restrictions of the Hatch Act,” in part because her predecessor, Jen Psaki, and White House Chief of Staff, Ron Klain, have previously been found in violation of the same federal law. Furthermore, Jean-Pierre herself “has on several occasions cited the Hatch Act as justification for avoiding responding to queries from the press corps,” PPT noted.

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    Tyler Durden
    Sun, 11/06/2022 – 14:00

  • Haley Joel Osment For Fed Chair
    Haley Joel Osment For Fed Chair

    By Peter Tchir of Academy Securities

    Haley Joel Osment for Fed Chair

    Maybe I’m the one who is “seeing dead people” as I’ve had my share of mistakes recently, but given Powell’s take on inflation, I think that he is the one “seeing dead people,” so Haley might be a good candidate.

    As much as I’d like to rant and rave about Friday’s wild market gyrations, the growth of trading in daily expiration stock options, flows into TQQQ and ARKK, and my new “favorite” ETF DBMF (managed futures), that will have to wait until the week starts.

    Today, we focus on inflation and (most importantly) jobs as we’ve hammered home the inflation story a lot lately. Some of this follows directly from Let Them Eat Expectations and Powell & The Fed (link).

    Inflation

    Let’s start this section with the bold statement that I would rent my house for two years to anyone who would pay me what the average of three credible realtors thought we could get at this time last year! However, I am not sure how well that will go over with my wife if someone takes me up on that offer. In any case, the input for rent in CPI is just ludicrously off-market. We’ve compared real world/timely rent numbers with owners’ equivalent rent in several recent pieces:

    As you can tell, autos, big ticket items, inventories, and commodities have also been themes in our “inflation questions.” We won’t spend any more time on those. Instead, we will try to address (more thoroughly) the questions about the job market that we are receiving.

    Jobs Will Be the Absolutely Last Thing to Crack in This Cycle

    My view is that:

    • We will see signs of a slowdown that will give the market hope that we can get a soft landing. This will re-start the “everything” rally (which fell apart after 2:30 pm on Wednesday), but started to claw its way back to life on Friday.

    • Then we will have the fear of a serious, deep, and longer-term recession.

    The second phase would include big hits to employment. While employment is almost always the last bit of economic data to roll over, it will be even slower to react this time around!

    Companies have spent the better part of the last 2 years finding it extremely difficult to hire employees! Arguably it has never been so difficult to hire employees. Even with pay, better benefits, and accommodative work schedules nothing seemed to help! So, here we are, with signs of weakness in the economy, uncertainty over the future (from so many perspectives), and even a few negative employment headlines. However, layoffs remain low and hiring seems solid. Why would we expect anything different?

    While we all make mistakes, we rarely make the same mistake twice as we tend to overcompensate (*cough* transitory *cough cough*). HR departments will be particularly reluctant to use layoffs in the first, second, or even third round of cost cuts! The inability to hire is too fresh in our minds and no-one wants to be caught in the situation where we get some sort of “softish” landing and need to hire people who were just let go. Starting conditions matter and the starting point of this slowdown is that labor is more protected than ever before – therefore weakness will show up in the labor market even later than usual. We could also see some discrepancies between large companies (that can afford to carry marginally useful workers) and small businesses (who don’t have that luxury).

    By the time that we see the data hit the employment statistics, it will be too late to do anything (and we should be at least starting to see a serious risk-off move).

    Questions Around the Jobs Data

    For rent, autos, and a few other things, I’m firmly in the camp that someone at the Fed is “seeing dead people.” For jobs, the data isn’t bad and that doesn’t surprise me because employment will be the last shoe to drop.

    Having said that, there are some things about the job market that deserve attention.

    • In Friday’s NFP Instant Reaction (link), we highlighted a few issues that don’t necessarily show extreme strength in the job market: wages, participation rate, and the large difference between the Household and Establishment Surveys (even considering relative accuracy).
      • Since we sent that, we’ve had numerous discussions about whether the Establishment is picking up the aforementioned possibility that large corporations are more reluctant than small companies to let go of employees at this stage. It also could be possible that people who know that they are being laid off report themselves as not working while the companies have yet to fill out the paperwork or are still paying severance. These are just few discussion points around this large deviation (2.3 million jobs since March).


         

      • We live in a world of “adjustments” to all of our data. I’m told that employment numbers tend to get revised down later than other numbers as the economy weakens (though I haven’t tried to verify that). But we did get 455,000 jobs created by the “birth/death” model in the October 2022 report, which was more than the 363,000 similar jobs calculated in the 2021 report. That seems a bit odd, as I’d be surprised if more people were creating businesses in October 2022 compared to October 2021. The overall jobs number last year was about 400k better than this year’s, so why is the birth/death model better? Anyways, something to think about.

    In Let Them Eat Expectations we explore the JOLTs report and come up with some questions that warrant further discussion and may account for why it seemed “to good to be true”. For example, since internet job sites have grown, the gap between jobs and hirings has been increasing which may explain why payroll numbers (even the good elements) weren’t as frothy as one might have expected from September’s JOLTs report (it is also a month old when it’s released).

    Jobs – Bottom Line

    I’m certainly seeing some “dead people” in the jobs data. Maybe I’m looking too closely, but it is easier to paint a less rosy job story than the consensus headlines are portraying.

    More importantly, we should not take much solace in the employment data as it will be the absolutely last part of the economy to roll over and by then, it will be too late! We will be Wile E. Coyote realizing that we are standing on air!

    Markets – Bottom Line

    I want to believe in the everything rally, but the Fed will likely push back and considering how painful the 36 hours after the press conference were, I’m embarrassed to even suggest that.

    Having said that, we have 6 weeks of economic data, we’ve made it through the bulk of earnings, and we get some seasonality in our favor. Buybacks are also in the headlines (rather than earnings), and we have a real shot that the Fed is now data dependent rather than on some pre-ordained path!

    Finally, my view remains that regardless of who wins what this week in the midterms, we will see more attention on the economy (at the expense of inflation fighting) and more steps towards coming to some sort of peaceful arrangement with Russia and Ukraine.

    Good luck and if you are in part of the country enjoying unseasonably great weather, enjoy it with some live people as “seeing dead people” isn’t all it’s cracked up to be!

    Tyler Durden
    Sun, 11/06/2022 – 13:30

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