Jul 08

Today’s News 8th July 2022

  • Ukraine Furious At Turkey For Allowing Passage Of Russian Ship Full Of "Stolen Grain"
    Ukraine Furious At Turkey For Allowing Passage Of Russian Ship Full Of “Stolen Grain”

    Ukraine has lashed out at Turkey and is currently demanding answers over a Russian-flagged cargo ship that was allowed to pass through straits controlled by the Turkish government as it sailed out of the Black Sea. Ukraine alleges the vessel was full of stolen Ukrainian grain, while Moscow has dismissed the reports as false.

    Ukraine has reportedly summoned Turkey’s ambassador, according to a Ukrainian foreign ministry statement Thursday. The cargo ship departed a Turkish port the day prior, with a maritime monitoring site observing that it’s since moved away from the Turkish coast almost a week after arriving.

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    The statement out of Kiev said it was “unacceptable” that Turkish authorities allowed the vessel to leave. Late Wednesday it reportedly left the country’s northwestern port of Karasu.

    “We regret that Russia’s ship Zhibek Zholy, which was full of stolen Ukrainian grain, was allowed to leave Karasu port, despite criminal evidence presented to the Turkish authorities,” foreign ministry spokesperson Oleg Nikolenko announced.

    Days ago Ukrainian officials issued formal request for their Turkish counterparts to seize the ship and arrest its operators. There were initial reports that it was in detention, but Ukrainian leaders were later outraged upon learning of its departure with a reported thousands of tonnes of Ukrainian grain.

    In departing Ukraine’s coast, the ship was among the first to set sail from Berdyansk port, which has been firmly under Russian military control: 

    Moscow-backed news channels celebrated what they called the first voyage of a commercial ship from the “liberated” port. While Zhibek Zholy may be the first to sail from Berdyansk since the war began, reports suggest other Russian ships have left other Ukrainian ports before, also carrying contested grain.

    Amid the emerging global food crisis given Ukraine’s grain exports have been blocked for months, something which Russia has blamed on the Ukrainians mining their ports, Kiev has consistently charged the Russians with a major and ongoing grain theft.

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    In the meantime, some NATO countries are in talks to cobble together an international naval coalition to provide safe passage for Ukraine’s food exports, as Responsible Statecraft reviews:

    More recently, as the danger of a global food crisis made worse by the loss of grain exports from Ukraine and Russia has increased, new calls have emerged for the United States and allies to use naval power to ensure that Ukrainian grain can safely transit the Black Sea. 

    Similar to demands for a no-fly zone, these ideas have been wrapped in humanitarian language. But in reality, they amount to a call for highly risky U.S.-led military action.

    Versions of the proposal have been put forward by Lithuania’s foreign minister, retired U.S. military leaders including admiral James Stavridis, general Wesley Clark, and general Jack Keane, as well as Democratic representative Elissa Slotkin and the editorial boards of the Boston Globe and Wall Street Journal.

    While these proposals vary in detail, all invoke the rhetoric of humanitarian intervention to justify and legitimize the action. The Wall Street Journal calls for a U.S.-led naval escort to be “planned and pitched as a humanitarian operation.” Stavridis referred to his plan as a “humanitarian grain mission” while Slotkin simply called for a “humanitarian escort.” The Boston Globe called its proposal a “human-rights mission” while the Lithuanian foreign minister deemed it a “non-military humanitarian mission.”

    The Russian-flagged vessels path over the past week, via Al Jazeera:

    These calls for such intervention on the Black Sea are likely only to grow as the global food supply crisis gets more acute, threatening millions of people on the brink of hunger in regions that have long been heavily reliant on grain from war-ravaged Ukraine, especially in the Middle East and Africa.

    Tyler Durden
    Fri, 07/08/2022 – 02:45

  • Greta Fumes As EU Declares Nuclear & NatGas 'Green'
    Greta Fumes As EU Declares Nuclear & NatGas ‘Green’

    Members of European Parliament (MEPs) voted on July 6 not to reject adding nuclear and natural gas activities to the European Union taxonomy for sustainable investments, paving the way for the EU to include such projects in its so-called “green” investments.

    As OilPrice.com’s Tsvetana reports, in a vote on Wednesday, most members of the European Parliament did not support a motion to block the Commission’s proposal. A total of 278 MEPs voted in favor of the resolution to block the proposal, 328 voted against, and 33 abstained. The vote failed to reach an absolute majority of 353 MEPs which was needed for Parliament to veto the Commission’s proposal.

    If neither Parliament nor Council object to the proposal by July 11, 2022, the act will enter into force and apply as of January 1, 2023, the European Parliament said. 

    The EU could reject the “green” status for gas and nuclear if 20 out of the EU’s 27 member states reject it, which is highly unlikely, analysts say.

    The European Commission updated earlier this year its Taxonomy Complementary Climate Delegated Act on climate change mitigation and adaptation covering certain gas and nuclear activities. Under the new taxonomy, some gas projects, including several pipelines, were given a “sustainable investment” status. Gas projects are “transitional” if they contribute to the transition from coal to renewables, the EU says.  

    The bloc is accelerating its efforts to reduce dependence on Russian pipeline gas after Russia invaded Ukraine, cut off the gas supply to several EU members that refused to pay in rubles, and most recently, slashed supply to major customers, including Germany and Italy.

    The “green status” for gas and nuclear has stirred a lot of controversy in EU institutions and among officials.

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    Some have argued supporting gas is now of critical importance with an unreliable major supplier, Russia. Others have said that the war in Ukraine and the Russian behavior in energy supply should be a wake-up call for the EU and the world to look to renewables and ditch dependence on fossil fuels.

    And Greta is mad…

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    As Brad Palumbo writes at The Washington Examiner, Thunberg is not the only supposed climate activist who has shunned nuclear power.

    Here in the United States, far-left Rep. Alexandria Ocasio-Cortez (D-NY) took major flack because her so-called “Green New Deal” did not mention the word “nuclear.” Sens. Elizabeth Warren (D-MA) and Bernie Sanders (I-VT) actually campaigned for president in 2020 on the stance that we should not build new nuclear plants and should “phase out” nuclear energy.

    So Thunberg’s viral stance is just the latest in a long history of the green Left opposing nuclear power. But this blind spot is utterly unsupported by the actual evidence and reveals that these activists’ true priority is not protecting the climate from carbon emissions. If that was really their priority, they’d be pushing nuclear power like crazy.

    According to the U.S. Department of Energy , nuclear energy is a “zero emissions clean energy source” that also “keeps the air clean by removing thousands of tons of harmful air pollutants each year that contribute to acid rain, smog, lung cancer and cardiovascular disease.”

    Indeed, as of 2017, nuclear energy produced 57% of America’s clean energy, per DOE.

    Of course, left-wing activists cite the waste produced by nuclear power generation as what makes it supposed not really “green.” But this isn’t a legitimate argument. As the DOE explains, “All of the used nuclear fuel produced by the U.S. nuclear energy industry over the last 60 years could fit on a football field at a depth of less than 10 yards.”

    Surely, we can manage to store that amount of waste safely, and it’s undoubtedly worth the trade-offs in terms of the enormous reduction in other pollutants. Indeed, DOE says that nuclear energy in the U.S. since 1995 has had the carbon dioxide emissions prevention equivalent of taking 3 billion cars off the road!

    So why do so many left-wing activists still oppose nuclear energy and support the status quo, under which many countries’ governments make nuclear energy development incredibly difficult?

    Some are undoubtedly well-intentioned and just misinformed about the facts regarding nuclear. Others may remain understandably but unduly scared by the word “nuclear” and one-off tragedies such as the Fukushima, Japan, meltdown , which happened using long-outdated nuclear technology.

    But the truth is that many left-wing activists, such as Ocasio-Cortez, oppose nuclear energy because their real climate agenda is a backdoor for radical socialist economic overhaul and the destruction of capitalism. You don’t have to take my word for it. Ocasio-Cortez’s former chief of staff openly said that the “Green New Deal” actually “wasn’t originally a climate thing at all,” adding, “We really think of it as a how-do-you-change-the-entire-economy thing.”

    So, the real antipathy against nuclear stems from the fact that nuclear energy is an efficient, zero-emissions, safe form of energy production that can address climate change through deregulation rather than a sweeping socialist overhaul of the economy.

    Tyler Durden
    Fri, 07/08/2022 – 02:00

  • Dr. Robert Malone Testifies At Texas Senate Committee: 'Regulatory Practices Had Been Discarded'
    Dr. Robert Malone Testifies At Texas Senate Committee: ‘Regulatory Practices Had Been Discarded’

    Authored by Enrico Trigoso via The Epoch Times (emphasis ours),

    Vaccinologist and key contributor to mRNA technology Robert Malone testified to the Texas Senate committee on Health & Human Services on June 28, highlighting some administrative actions during the pandemic that he thinks were incorrectly handled and that should be taken into consideration for the future.

    Dr. Robert Malone in Washington on June 29, 2021. (Zhen Wang/The Epoch Times)

    Malone is also a specialist in clinical research, medical affairs, regulatory affairs, project management proposal management, vaccines, and biodefense.

    He said that prior to the Covid-19 outbreak, the standard procedure would have been for the CDC (Center for Disease Control and Prevention), a federal agency, to give advice to state public health authorities in order to regulate medical practices.

    “Up until the present, that’s always been acknowledged. The role of the federal government is in consultation and support and advice. This approach has not been implemented during the COVID crisis … during SARS-Cov2 COVID-19 outbreak, new policies and practices have been implemented,” Malone testified in the hearing.

    Malone has been involved with previous outbreak responses, including AIDS, anthrax, smallpox, and has worked on the smallpox vaccine, influenza vaccine, Ebola, Zika, and now SARS-Cov2.

    Regulatory Practices ‘Discarded’

    “The NIH and particularly NIAID have developed and propagated treatment protocols throughout the United States.

    “Development of vaccine products have been accelerated and historic non-clinical, clinical development, and regulatory practices had been discarded in a quest for speed under specific pressure from the executive branch in the prior administration. Development of repurposed drugs and treatment strategies have paradoxically been aggressively blocked or inhibited by both NIH and FDA, apparently due to requirements in the federal emergency use authorization statute language, requiring lack of available alternatives as a predicate, to granting emergency use authorization to a new product, including a vaccine product,” Malone said.

    The mRNA pioneer believes that due to poor management, public health officials were not able to access up-to-date information about the safety of the vaccines.

    “This has compromised the informed consent process. CDC has actively promoted and marketed vaccination with an unlicensed emergency use authorized product. With over $1 billion in U.S. federal funding expended to both market the products and to censor those who’ve raised concerns regarding vaccine safety and effectiveness. This is not an opinion. It is well documented through Freedom of Information Act document disclosure.” Malone said.

    Read more here…

    Tyler Durden
    Thu, 07/07/2022 – 23:40

  • Maryland Governor Loosens Concealed Carry Law, Spurs Demand For Gun Permits 
    Maryland Governor Loosens Concealed Carry Law, Spurs Demand For Gun Permits 

    Maryland Gov. Larry Hogan relaxed the state’s rules for obtaining a concealed handgun permit following the U.S. Supreme Court decision. The action spurred a surge in Marylanders seeking concealed carry classes — with some gun stores that offer firearms training saying classes are booked for the rest of the year. 

    On Tuesday, Hogan directed the Maryland State Police to suspend the “substantial reason” provision in the state rules for receiving a concealed-carry permit. Applicants must only provide a copy of their driver’s license, background check, fingerprints, and firearms training certificate for approval. 

    The action comes two weeks after the New York State Rifle & Pistol Association v. Bruen ruling, where the Supreme Court’s 6-to-3 conservative majority found that New York’s concealed-carry law required applicants to show “proper cause” for obtaining a handgun was in violation of the Second Amendment. 

    Hogan’s statement reads:

    “Over the course of my administration, I have consistently supported the right of law-abiding citizens to own and carry firearms, while enacting responsible and common-sense measures to keep guns out of the hands of criminals and the mentally ill.

    “Last month, the U.S. Supreme Court struck down a provision in New York law pertaining to handgun permitting that is virtually indistinguishable from Maryland law. In light of the ruling and to ensure compliance with the Constitution, I am directing the Maryland State Police to immediately suspend utilization of the ‘good and substantial reason’ standard when reviewing applications for wear and carry permits. It would be unconstitutional to continue enforcing this provision in state law. There is no impact on other permitting requirements and protocols.

    “Today’s action is in line with actions taken in other states in response to the recent ruling.”

    The governor’s action has spurred huge demand for concealed carry classes. Gun stores across the Baltimore metro area tell us “the flood gates have opened,” as law-abiding citizens who couldn’t obtain a permit under “proper cause” now can. 

    One gun store in Towson, Maryland, said classes are booked until the end of the year, while another in Fredrick, Maryland, said the same thing. 

    Besides New York and Maryland, the Supreme Court’s decision has flipped New Jersey. California, Hawaii, and Rhode Island could be next. 

    Concealed carry classes in states that just flipped are selling like hotcakes — it might be hard to find a class well into 2023 because the capacity for firearms training courses is limited.

    Tyler Durden
    Thu, 07/07/2022 – 23:20

  • Former Japanese PM Shinzo Feared Dead After Assassination Attempt
    Former Japanese PM Shinzo Feared Dead After Assassination Attempt

    Update (2317ET): Accroding to Kyodo news, former Japanese Prime Minister Abe is reportedly showing no signs of life and has suffered from cardiac arrest after being taken to the hospital, according to police and fire officials.

    The 67-year-old was shot from approximately 3 meters (10 feet) away. The suspect, 41-year-old Yamagami Tatsuya, reportedly stayed on the scene until his arrest on an attempted murder charge.

    Nikkei 225 futures erased gains following news of Abe’s collapse, while the yen gained with US Treasuries.

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    Former Japanese Prime Minister Shinzo Abe has reportedly been shot in the chest during a campaign speech at around 11:30 a.m. in the city of Nara, near Kyoto. According to NHK what sounded like ‘consecutive bangs’ were heard, after which Abe could be seen bleeding – with some reports saying from the neck. It appears he was shot in the left chest area from behind.

    The local fire department reports that Abe is in cardiac arrest, while Liberal Democratic Party (LDP) members reported him to be unconscious.

    A suspect, believed to be a young or middle-aged man, was apprehended at the scene along with a shotgun, according to NHK.

    Futures took an immediate hit on the news.

     

    Tyler Durden
    Thu, 07/07/2022 – 22:51

  • China Dominates The Antibiotics Market
    China Dominates The Antibiotics Market

    Global exports of antibiotics originate predominantly from China – as Statista’s Martin Armstrong shows in the infographic below based on data from the International Trade Center (ITC).

    China currently accounts for 42.4 percent of global antibiotic exports by value. Italy, India and Switzerland follow far behind.

    For years, experts have been warning of the EU’s dependence on antibiotic supplies from abroad, especially China and India.

    Infographic: China Dominates the Antibiotics Market | Statista

    You will find more infographics at Statista

    This dependence is not only limited to antibiotics, but affects – also for many years – a wide range of pharmaceutical products, including cortisone, for example.

    In addition, the world is facing another, increasingly significant problem: More and more bacteria are developing resistance to common antibiotics.

    As a result, there is now a pressing need for drugs that are specifically effective against resistant germs. Most of the antibiotic classes introduced in the 21st century do just that. However, research into these active substances is often not profitable and risky for the industry; because drugs that specifically act against resistant germs are not used across the board, but only as so-called “second-line” or “last-line” antibiotics (reserve antibiotics) – as a last resort when the established drugs are no longer effective.

    Tyler Durden
    Thu, 07/07/2022 – 22:40

  • Top House Republican Presses Yellen For Records On Hunter Biden’s Foreign Business Dealings
    Top House Republican Presses Yellen For Records On Hunter Biden’s Foreign Business Dealings

    Authored by Eva Fu via The Epoch Times (emphasis ours),

    A top House Republican is demanding Treasury Secretary Janet Yellen release records on Hunter Biden’s foreign business activities, alleging that the biden administration’s reluctance to release such details suggest an effort to shield the Biden family from scrutiny.

    Hunter Biden, the son of U.S. President Joe Biden, is seen during the annual White House Easter Egg Roll on the South Lawn of the White House in Washington, on April 18, 2022. (Mandel Ngan/AFP via Getty Images)

    In a letter on July 6, Rep. James Comer (R-Ky.), a ranking member on the House Committee on Oversight and Reform, asked Yellen to provide reports of what he thought was “suspicious activity” on the part of the younger Biden, his business associates, and other Biden family members.

    Hunter, the second son of President Joe Biden, is currently under federal investigation for potential tax violations. Scrutiny has been growing over his overseas business dealings in countries such as Ukraine, Russia, and China, particularly during the period while Biden was vice president in the Obama administration.

    Under the Bank Secrecy Act, U.S. banks flag cash transactions exceeding $10,000 a day and automatically generate suspicious activity reports, also called SARs, in a bid to help U.S. government agencies prevent money laundering.

    Comer previously wrote to Yellen in late May requesting the SAR reports for Hunter Biden but received no answer. He accused the Biden administration of restricting Congress’s access to SARs, citing a recent Treasury Department rule that allows Congressional staff to review such materials in a Treasury reading room. They are barred from making copies of the documents.

    “Committee Republicans are investigating whether this change in longstanding policy is motivated by efforts to shield Hunter Biden and potentially President Biden from scrutiny,” the letter read.

    Refusing Release

    “Despite Treasury’s assertion in the press that it ‘provides SARs to Congress in a manner that enables robust oversight,’ Treasury is refusing to release SARs connected with Hunter Biden or his family and associates—including the President,” Comer wrote in the letter.

    He noted that in a phone call on June 13, five days after the June 8 deadline for Comer’s request, Treasury officials told Republican staff on the House Oversight Committee that “they will not provide SARs to Committee Republicans unless Democrats join the request.”

    That marked a contrast with the Treasury Department statement shortly after Comer’s initial request.

    “Treasury has made SARs available for every request we’ve received, regardless of party, and will continue to do so,” the department told Wall Street Journal at the time.

    “It is troubling that the Biden Administration is willing to provide a false story to the media to create the appearance of transparency, while continuing to thwart congressional oversight,” Comer said. “Treasury’s actions call for investigation and raise new questions about the degree to which the Biden Administration is using the federal government to provide cover for the Biden family and its associates.

    Ranking member Rep. James Comer Jr. (R-KY) speaks during a House Committee on Oversight and Reform hearing on gun violence in Washington on June 8, 2022. (Andrew Harnik-Pool/Getty Images)

    “The American people deserve to know whether the President’s connections to his son’s business deals occurred at the expense of the United States’ interests and whether they represent a national security threat.”

    Comer’s inquiry to over a dozen banks in May, including the Bank of China, Cathay Bank, and JP Morgan Chase, also didn’t receive any responses.

    The banks said they cannot provide the requested materials without a subpoena, Comer’s office told The Epoch Times.

    Biden’s Voicemail

    Hunter in 2017 and 2018 received millions in payments from Chinese state-linked companies, according to recently released bank records. Emails from what is alleged to be his abandoned laptop also show him trying to broker a $120 million oil agreement between a Chinese state-owned oil company and Kazakhstan’s prime minister at the time.

    Biden has in public repeatedly denied having discussed with Hunter about the latter’s foreign business transactions. But a leaked voicemail, dating back to December 2018 and recovered from the laptop that Hunter allegedly left in a Delaware repair shop, contradicts his claims.

    Read more here…

    Tyler Durden
    Thu, 07/07/2022 – 22:20

  • June Payrolls Preview: Big Data Hints At A Huge Negative Surprise
    June Payrolls Preview: Big Data Hints At A Huge Negative Surprise

    In previewing tomorrow’s nonfarm payrolls report, Goldman trader Matthew Fleury writes that “the market wants not too hot not too cold to keep this bid. Strong enough to say the world isn’t going into recession. Not too strong to send US10s back to 3.25% on the day. Not too cold to highlight US data deteriorating while inflation will stay high and fed hiking 75bps into dramatic slowdown. Something like 175k to 250k.”

    It’s probably not a surprise then that with markets hoping for a print just north of 200K that consensus is also in the same ballpark (median consensus is at 268K). But while the rate of payrolls growth is expected to cool again in June (from 390K in May), once again traders will be paying close attention to the wage metrics within the data to help shape expectations about whether the Fed will raise rates by either a 50bps or a 75bps increment at the July FOMC meeting.

    As Newsquawk writes in its NFP preview, the jobs report is one part of the equation in forming these expectations, the other being the June CPI Data due next week. The data releases could also determine the course for rate hikes through the rest of this year; a recent dovish repricing of the trajectory of Fed rate hikes (on the back of recession fears) has been unwinding, and money markets now assign an approximately 50% chance rates will rise to 3.25-3.50% by year-end. Another note of caution: high-frequency data on the labor market generally indicate weakness in June employment, with all three indicators consistent with an outright decline in seasonally-adjusted payrolls (see below).

    Here is what Wall Street expects:

    • Analysts expect the rate of job additions will continue to cool in June, with the consensus looking for 268k payrolls to be added; that would be lower than May’s 390k, which is lower than recent averages too (3-month average 408k, 6-month average 505k, 12-month average 545k).
    • Analysts see the jobless rate holding at 3.6% in June; the Fed’s recently updated economic projections see the unemployment rate ending this year at 3.7%, rising to 3.9% next year, and then 4.1% in 2024.
    • Fed Chair Powell in June said that unemployment at 4.1% would be a successful outcome and is still a historically low level, suggesting the Fed will be happy to allow unemployment to rise to this level as the Fed attempts to return inflation to target.
    • Goldman is uncharacteristically below consensus, and estimates nonfarm payrolls rose by 250k in June, a sharp slowdown from the +408k three-month average. The bank also estimates private payrolls rose 200k in June (vs. consensus +235k), and notes the possibility that the June seasonal factors are overfitting to the reopening-related job surges in June 2020 and June 2021. This higher seasonal hurdle represents a headwind of roughly 200k, in Goldman’s view, other things equal

    Average Hourly Earnings: As has been the case for many months now, traders will be carefully watching measures of wage growth for signs of how the ‘second round’ effects are faring. Average hourly earnings are expected to rise 0.3% M/M, matching the May rate; the annual measure is seen cooling to +5% Y/Y from 5.2% in May. The FOMC’s June meeting minutes said that some contacts had reported that, because of previous wage hikes, hiring and retention had improved and pressure for additional wage increases appeared to be receding, while Powell at the June FOMC said we are not seeing a wage-price spiral but he did note wage growth is elevated.

    Arguing for a weaker-than-expected report:

    • Evolution of the seasonal factors. The June seasonal factors have evolved unfavorably in recent years, with a month-over-month hurdle of 974k in June 2021 and 939k in June 2020 compared to the 821k hurdle in June 2016 and 733k in June 2012 (these were also 5-week June payroll months). Goldman cautions of the possibility that the June seasonal factors are overfitting to the reopening-related job surges in June 2020 and June 2021. This higher seasonal hurdle represents a headwind of roughly 200k.

    • Employer surveys. The employment components of business surveys generally decreased in June. The Goldman services survey employment tracker decreased by 0.2pt to 54.5 and its manufacturing survey employment tracker decreased by 0.3pt to 55.8.
    • Job cuts. Announced layoffs reported by Challenger, Gray & Christmas increased 74.0% month-over-month in June, after decreasing 32.0% in May. The June increases were particularly pronounced in the real estate, autos, and media industries.
    • Big Data. High-frequency data on the labor market generally indicate weakness in June employment, with all three indicators consistent with an outright decline in seasonally-adjusted payrolls, averaging well over 1 million jobs lost in June! However, we note that these signals significantly understated BLS payroll growth in both April and May, which is why economists tend to place less weight on them for this report. Of course, one day they will be right…

    • Jobless claims. Initial jobless claims increased from very low levels during the June payroll month, averaging 222k per week vs. 200k in May. Continuing claims in regular state programs decreased 19k from survey week to survey week before rebounding after the end of the payroll month.

    Arguing for a stronger-than-expected report:

    • Job availability. The Conference Board labor differential—the difference between the percent of respondents saying jobs are plentiful and those saying jobs are hard to get—edged up by 0.2pt to +39.7. JOLTS job openings decreased by 427k in May to 11.3mn. Despite the sequential weakness, the level of labor demand remains very high, which likely supported continued job growth in the leisure and healthcare sectors.
    • Labor supply constraints. When the labor market is tight, job growth tends to slow during the spring hiring season in March/April/May. It then tends to pick back up in June with the arrival of the summer youth labor force. For example, nonfarm payrolls rose 224k in June 2019 after just +75k in May (first-reported basis).

    Policy Implications: The Federal Reserve’s recently updated economic forecasts acknowledge that aggressive rate hikes ahead will weigh on growth and the labor market. But officials have talked up the strength of the economy, and seem confident in their ability to tighten policy without causing significant damage to the labor market. Officials have noted that the jobs market is strong, demand for labor continues to outstrip supply, unemployment is near a 50-year low while job vacancies are at historical highs, and there is elevated nominal wage growth. Officials have recently been suggesting that the debate in July will be between 50bps and 75bps, and any upside surprise in the wages data will embolden calls for the Fed to raise rates by 75bps again on July 27th. Currently, money markets are assigning an approximately 85% chance that rates will be lifted by the larger increment, but if this metric was to post a downside surprise, it could help pricing tilt back into the 50bps bucket. It is also worth keeping in mind that Fed officials decided to go with a larger-than-guided 75bps rate hike in June after the hotter-than-expected May CPI data; accordingly, next Wednesday’s CPI Report for June will also play an instrumental role in setting policy expectations for the July meeting.

    Some have suggested that the jobs data and inflation report might end up having more of an impact on pricing beyond the July meeting. Amid the recent growth fears, market pricing for rates to end this year between 3.25-3.50% diminished to the point that 3.00-3.25% was a more likely outcome; however, in recent sessions, we have seen the implied probability of a move to 3.25-3.50% rise and is now about 50/50.

    Finally, those looking at the recent past for hints of what’s to come, keep in mind that 7 of the last 8 payrolls days have ended lower 6 hours after the print (whether it was a beat or a miss).

    Which probably means we are overdue for a reversal…

     

    Tyler Durden
    Thu, 07/07/2022 – 22:08

  • Gun-Makers Go South
    Gun-Makers Go South

    Authored by Kevin Stocklin via The Epoch Times (emphasis ours),

    Of all the businesses that are moving out of blue states, those in the gun industry lead the pack.

    A customer looks at an antique shotgun at a gun shop in Ottawa, Ohio, on Jan. 23, 2020. (Brendan Smialowski/AFP via Getty Images)

    Storied firearms manufacturers, some of them having operated in northern states for centuries, are now heading South. Remington, founded in 1816 and America’s oldest gun maker, announced in November it was moving its headquarters from New York to Georgia.

    In announcing the move, which will include a $100 million investment in a state-of-the-art manufacturing facility and create 856 new jobs, Remington CEO Ken D’Arcy said, “the decision to locate in Georgia is very simple. The state of Georgia is not only a business-friendly state, it’s a firearms-friendly state.”

    Also exiting New York is Dark Storm Industries, a gun manufacturer and retailer. They will be moving to Titusville, Florida, where they have begun construction on a new manufacturing plant, bringing up to 75 jobs to Florida.

    “If you’re in the gun industry and you have the opportunity to move to Florida, you’re figuring it out, that’s where you want to be,” Dark Star Communications Manager Kevin Elder told The Epoch Times. When the company asked its employees if they would consider moving south, they didn’t hesitate, Elder said, “they were ready to go.”

    Dark Star was founded to make firearms that are compliant with New York’s strict regulations, “but they just keep adding on more and more restrictions and more hoops to jump through,” Elder said. “Our clientele is very friendly, and our community, and we try to give back as much as we can. We do a lot of charity work and local law enforcement loves us. But as far as the state itself, they don’t want that kind of stuff up here.”

    Elder said that Dark Star’s problems in New York went beyond state regulations to also include banks and payments companies. “We had to change credit card processors,” as well as the company’s bank, he said, because they were denying service to firearms companies, despite their strong creditworthiness.

    Tennessee has been another popular destination, attracting Smith & Wesson in September and Troy Industries last May, both from Massachusetts. Even before these moves were announced, Tennessee was already home to more than 20 firearms manufacturing companies.

    Smith & Wesson’s move to Maryville, Tennessee, will include a $125 million investment and create 750 new jobs. Among the many reasons cited by CEO Mark Smith were new laws proposed by Massachusetts’ Democrat-led legislature banning the sale, possession and manufacture of “assault weapons” and “large-capacity magazines” for civilian use. Smith noted that these products comprised 60 percent of his company’s revenue.

    Steve Troy, CEO of Troy Industries also cited the “changing climate for firearms manufacturers” in Massachusetts, which “determined the need for our relocation to Tennessee.” Troy Industries will invest $7 million in Clarksville, Tennessee, adding 75 jobs.

    Other firearms companies leaving blue states include Kimber Manufacturing, which left New York for Alabama; Winchester Centerfire, which left Illinois for Mississippi; Stag Arms, which left Connecticut for Wyoming; and Magpul Industries, which left Colorado for Wyoming and Texas.

    The migration of the firearms industry is part of a wider movement by American firms to escape high-tax, high-regulation states like California, New York, Illinois, and New Jersey. But gun makers are in a particular hurry to exit these states in response to new laws and regulations seemingly intended to drive them out.

    What all of the destination states have in common is that “they are respectful of the contributions that these businesses make to state economies,” National Shooting Sports Foundation Managing Director Mark Oliva told The Epoch Times. “And they are respectful of the Second Amendment rights of consumers who are buying these firearms.”

    Read more here…

    Tyler Durden
    Thu, 07/07/2022 – 21:40

  • Dating Website Match.Com Has Option For 31 Genders 
    Dating Website Match.Com Has Option For 31 Genders 

    Twitter account Libs of TikTok – which aggregates videos posted on TikTok by deranged leftists, tweeted a short video clip of someone scrolling through more than two dozen genders now listed on popular online dating website Match.com. 

    Gender fluidity is on full display as users of Match can pick from 31 genders. Some of the genders listed include “Two-Spirit,” “polygender,” “pangender,” “neutrois,” and “gender questioning.” 

    At the start of the short video clip, Match asked the user: “Hi, let’s get started. Which best describes you?” There are options for “I’m a man,” “I’m a woman,” and “more options.” 

    The user picks “Man” but is also greeted with a list of 31 genders. Some of the other genders include “transgender person,” “genderqueer,” “gender non-conforming,” “non-binary,” “gender variant,” “transsexual man,” “gender fluid,” and “bigender,” among many others. 

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    Infamously in 2014, Facebook offered 72 gender options rather than two sexes. One year later, Facebook changed the gender option to an open text box.

    It appears the internet has fueled a gender revolution pushed by the radical left — has led to an increase in young people who identify as transgender or other. This is made possible by public schools allowing drag queen storytelling and the indoctrination of children in their earlier years about radical gender ideology. 

    So it makes sense why the CDC’s Youth Risk Behavior Surveillance System survey recently found that the number of youths ages 13 to 17 identifying as transgender jumped to 1.4% (approximately 300,000 young transgender people), up from 0.7% of teens in 2017. The number will only rise — on a long enough timeline, comedian Bill Mahr says that 100% of the US population will be identifying with the LGBTQ by 2050 (jokingly, of course). 

    Academic James Lindsay has said young people are increasingly subjected to communist-style sexualization and explains why: 

    The goal is to destabilize society to make it ripe for communists to grab power, Lindsay, author of “Race Marxism” and “Cynical Theories: How Activist Scholarship Made Everything about Race, Gender, and Identity―and Why This Harms Everybody,” recently told EpochTV’s “China Insider” program.

    Gender indoctrination in public schools is reshaping society. Match’s gender list of 31 to pick from is a symptom of that. Even though there are all sorts of different genders, restaurants, stadiums, airports, and other public places, only have two bathrooms, one for male and one for female.

    Tyler Durden
    Thu, 07/07/2022 – 21:20

  • Victor Davis Hanson: The Disappearing American?
    Victor Davis Hanson: The Disappearing American?

    Authored by Victor Davis Hanson,

    “Help wanted” and “Now hiring” signs are everywhere.

    Flights, construction projects, and healthcare services are delayed – or unavailable – due to labor shortages.

    Hourly and monthly wages spiral.

    There is a growing disequilibrium between the number of available jobs and the declining pool of workers needed to fill them.

    What is going on?

    During the nearly two-year-long COVID-19 shutdown and economic downturn, firms cut costs by laying off millions of employees.

    As a result, some in their early- or mid-60s simply retired early and never came back to work.

    Federal and state governments also vastly expanded financial support to the unemployed.

    Other workers figured they would not make all that much more by working and so are staying home on government checks.

    Still other former full-time employees became used to the new, more leisurely lifestyle and are loath to return to a full 40-hour work week.

    Employers also are now convinced that a hard recession is on the early 2023 horizon when the trillions of dollars of newly printed money run out. Many are willing to put up with worker shortages now, rather than hire too many employees only to have them idle when consumer demand soon crashes.

    Still other workers fear yet another COVID pandemic and are not eager to return to daily contact with the public.

    The government has no idea how some Americans remain sick with the mysterious “long COVID” chronic aftermath of the infectious phase of the disease.

    Well over 100 million Americans have likely had COVID. An estimated 10-30 percent do not recover for months — or even years.

    So, millions of COVID long haulers remain either unable to work or can only work part-time.

    Yet no one yet has fully calibrated the effect of newly disabled millions on the American economy.

    Add up all these dark clouds and America is experiencing a perfect storm, in which only 61% of the able workforce is currently officially employed.

    Unfortunately, there are also even longer-term, structural labor problems for the U.S. economy that make it unlikely that a new larger generation of workers will soon surge into the labor force. And for now, Silicon Valley has not produced its long promised artificially intelligent robots that would allow machines to do much of the work of people.

    True, there are more potential parents than ever before. And the American population has soared to over 330 million.

    But our population is radically leveling off.

    In just 14 years the fertility rate has crashed from 2.12 to 1.64 — meaning that both citizens and resident aliens in America are not replacing themselves.

    While past demographic momentum has led to an all-time population high, the United States has already peaked demographically. And it will soon shrink and further age.

    Thirty years ago, America had 80 million fewer people, but a quarter-million more annual births.

    What explains the disappearing American?

    Historically, as Westernized cultures become more affluent and leisured, whether it’s ancient Rome or modern America and Europe, they birth fewer children — even as their appetites for more household and personal help spike.

    Life apparently is seen as too enjoyable to invest years in raising children. Americans are certainly marrying later. They are having fewer children — and in their 30s rather than 20s.

    Women now make up nearly 60% of undergraduate college students. Female professional careers and delaying or avoiding birth are seen as essential to future family incomes.

    Given that men who pass on college now account for 70% of enrollment declines in undergraduate education, there are far too few college-educated males for the new majority cohort of college-educated women.

    The real gender crisis in America are these listless and stalled 20-something men. Too many are still living at home, not fully employed, often in debt, hooked on social media, video games, or satisfying their appetites — and with scant interest in marrying, much less raising children.

    Figures on annual abortions remain hotly disputed. But the number of annual reported abortions still ranges between somewhere from more than 600,000 to just under 900,000.

    There may be almost 20 abortions for every 100 American pregnancies — or one in five pregnancies that are terminated.

    Our popular culture reflects this multifarious growing reluctance to raise children. And currently only 65% of children grow up in families with both parents.

    The 2012 Obamacare ad, “The Life of Julia,” fixated on the new ideal American woman: a single parent of one child, unmarried, and utterly reliant on nearly 65 years of government support.

    The 2013 follow-up bookend ad fetishized “Pajama Boy.” He was supposed to be a typical prolonged-adolescent, man-child — sitting at home in his child-like footie pajamas, sipping hot chocolate.

    “Pajama Boy” was likely the sort that “Julia” had no intention of marrying.

    There are historical downsides — economic, cultural, social, and military — to nations that shun child-raising.

    They shrink in size, age, no longer believe in transcendence, become mostly agnostic or atheistic, and obsess on the self.

    And sometimes they eventually become dysfunctional — and slowly disappear.

    Tyler Durden
    Thu, 07/07/2022 – 21:00

  • "Celebrity & Wealth": Ex-Marine Paul Whelan's Sister Livid After Biden Reaches Out To Griner's Family
    “Celebrity & Wealth”: Ex-Marine Paul Whelan’s Sister Livid After Biden Reaches Out To Griner’s Family

    Update(1305ET): Given WNBA star Brittney Griner’s high-profile status and media visibility, President Joe Biden is under mounting pressure to bring her home, after on Thursday she pleaded guilty in a Russian court to drug charges after getting caught with Cannabis cartridges while going through a Moscow airport in February, just days prior to the Ukraine invasion.

    But a top Russian diplomat disagrees that the highly covered court case is a ‘big deal’. Deputy Foreign Minister Sergei Ryabkov on Thursday dismissed what he called “hype” surrounding Griner’s detention in Russian jail. “The American side’s attempts to foment hype and make noise in the public environment are understandable, but they don’t help to practically resolve issues,” Ryabkov told reporters at the courthouse. Washington has slammed what it’s characterized as the Kremlin seeking to use a prominent US citizen as a political pawn amid the backdrop of war.

    But Paul Whelan’s family also appears to agree that the Griner case is being unfairly prioritized by the White House. This after, as the The Hill and others reported, there was “a conversation between President Biden, Vice President Harris and Cherelle Griner, Brittany Griner’s wife, on Wednesday.” Whelan, who is a US Marine veteran, has been in Russian detention for over three years. He was arrested in Moscow in 2018 on charges of “carrying out an act of espionage,” and sentenced to a total of 16 years in prison. His family is livid after news of the Biden phone call with Griner’s family, with Whelan’s sister saying she’s “crushed” by lack of the same or similar attention given to Whelan…

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    “I am crushed. If he wants to talk about securing Paul’s release, he needs to be talking to the Whelans! What are we to think?!” Elizabeth Whelan emphasized.

    Apparently, Biden made the phone call to Griner’s family merely after a media outcry, but not to the Whelan’s even after Paul is set to languish for over a decade longer:

    The White House said Biden and Harris assured Cherelle Griner that they are providing “all possible assistance” to bring home Brittney Griner, who has been in detention in Russia since February.

    Biden’s call to Cherelle Griner came after she told CBS it was “very disheartening” not to have heard from the president directly. Brittney Griner also wrote a letter to Biden urging him not to “forget about me and the other American detainees.”

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    * * *

    Making her second appearance in a Moscow court Thursday, WNBA star and Olympic champion Brittney Griner has pled guilty to drug charges under Russian law for which she could be given a maximum ten year sentence.

    “Brittney Griner pleaded guilty to drug smuggling charges as her trial continued in Russian court, admitting to bringing cannabis into the country but saying she had packed in a hurry and did not intend to break the law,” NPR writes. “Russia continued to make its case against Griner at her trial on Thursday, more than 140 days since the WNBA star was arrested at a Moscow-area airport on drug charges.”

    WNBA star and two-time Olympic gold medalist Brittney Griner, via AP

    At this point an expected conviction is considered very likely based on the guilty plea. She’s been detained in Russia since before the war – arrested at a Moscow airport on Feb.17 for allegedly having cannabis oil on her possession, used for vaping.

    Washington has viewed her case as one where Russia is attempting to gain leverage for negotiations, using Griner as a political pawn. Weeks ago the State Department officially deemed her status “wrongfully detained” – which implies she’s being viewed as hostage of a foreign state. This allows the federal government to negotiate her return.

    Western officials have slammed a “show trial” now being conducted, but it’s a major step before possible negotiations for her return. And yet it remains that Griner pleading guilty to a crime under Russian law complicates matters, to say the least. According to analysis in ESPN:

    But before the trial even begins, U.S. experts and officials say Griner will be the subject of a show trial, and a guilty verdict is almost a certainty. The entire exercise, they say, is a negotiation tactic to push the Biden administration into trading for her freedom.

    “It’s a foregone conclusion and the trial is to uphold the state and confirm the power of the state,” says William Pomeranz, the acting director of the Wilson Center’s Kennan Institute in Washington and an expert on Russian law. “Justice is not the immediate issue.”

    It’s likely that Griner will spend the whole proceedings in a steel cage, just as most Russian defendants in standard criminal cases.

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    Russia is recently  hinted that it could be ready to negotiate a hostage swap for a notorious arms trafficker named Viktor Bout.

    Griner had been spending off-seasons from the WNBA playing for a Russian team going back to 2016. According to one prior report she was given “red carpet” treatment and paid very well:

    Griner traveled to Russia to play for UMMC Ekaterinburg, which she has been doing since 2016. The team is reportedly backed by a large corporation.

    An ESPN feature from May of that year dug into Griner’s deal. UMMC Ekaterinburg provided each American player with a personal driver in addition to other amenities. “The restaurants are good, the team pays well and takes care of every detail — chartering flights to away games, delivering bottled water to their apartments — the arena is always filled with locals, and the coaching staff” was composed of many coaches Griner was familiar with from Phoenix Mercury.

    Griner took the job to supplement her salary from the WNBA, which is something about half the league’s players do. For her first season, she was paid a little less than $1 million which was about four times the WNBA’s max annual salary. 

    There’s the possibility that she had already been waived through airports with banned vaping substances prior to her Feb.17 arrest, and that authorities may have known this – but the Kremlin could have been waiting for the politically opportune time to make headlines with the arrest.

    Tyler Durden
    Thu, 07/07/2022 – 20:44

  • What India And China Spend On Russian Oil
    What India And China Spend On Russian Oil

    India and China have both been spending more money on Russian oil in 2022 compared to 2021, but, as Statista’s Katharina Buchholz details below, for different reasons.

    Infographic: What India and China Spend on Russian Oil | Statista

    You will find more infographics at Statista

    China’s spending on the commodity rose by 78 percent between March and May 2021 and the same time period this year. According to a report by Bloomberg, this increase can be chalked up to the price increase of oil on the world market. China receives oil from Russia through pipelines crossing the countries’ shared border which makes delivery cheaper but also harder to increase. In addition, China had already been buying most oil that can be shipped out of Russia’s Pacific ports previous to the invasion of Ukraine, another factor showing that the increase in spending in China is for approximately the same amount of oil – which the country hasn’t majorly increased but also didn’t try to decrease since the Russian war in Ukraine started.

    This shows that India has been buying additional shipments of Russian crude, which are – according to the report – those coming from Russian ports in the Western part of the country and would normally be shipped to Europe. But since European countries have decreased their buying of Russian oil, India has been accepted more shipments at a discounted prices as the route would normally be too long to be economically viable.

    The data also shows that despite India’s increase in shipments, the money it pays Putin’s regime is still far lower that the funds coming from China. While India paid $3.5 billion for the three-month period, China shelled out an much higher $15.7 billion.

    Tyler Durden
    Thu, 07/07/2022 – 20:40

  • University Of California Waives Tuition For Native Americans, Starting Fall 2022
    University Of California Waives Tuition For Native Americans, Starting Fall 2022

    Authored by Alice Sun via The Epoch Times,

    Native American students attending schools in the University of California (UC) system will have their tuition fully waived starting this fall.

    A student walks toward Royce Hall on the campus of University of California at Los Angeles (UCLA) in Los Angeles, Calif., on March 11, 2020. (Robyn Beck/AFP via Getty Images)

    Announced in April, the UC Native American Opportunity Plan allows California residents who are “members of federally recognized Native American, American Indian, and Alaska Native tribes” to get free education on UC campuses. The program applies to undergraduate and graduate students.

    “The University of California is committed to recognizing and acknowledging historical wrongs endured by Native Americans,” UC President Michael Drake said in a letter (pdf).

    “I am proud of the efforts the University of California has made to support the Native American community, including the creation of the [program].”

    The UC system has ten campuses—Berkeley, Davis, Irvine, Los Angeles, Merced, Riverside, San Diego, San Francisco, Santa Barbara, and Santa Cruz. About 295,000 students were enrolled in the system in fall 2021.

    Students pass through Sather Gate of the college campus at the University of California–Berkeley, in a file photo. (David A. Litman/Shutterstock)

    The program is expected to cost $2.4 million and will be funded mainly by both the state’s and UC’s financial aid programs, according to Drake’s office.

    The program was developed to expand “student diversity and make the University of California more affordable and accessible,” Drake said in the letter. The approximate annual tuition for a state resident is $13,104, according to the UC Admissions office.

    California has 109 federally recognized tribes and has more Native Americans and those of Alaska Native heritage than any other state in the country, according to the Judicial Council of California.

    Native Americans make up 1.7 percent of the state’s population while accounting for 0.5 percent of the UC system’s student body in Fall 2021, according to the U.S. Census Bureau and the university’s enrollment statistics.

    Some universities and lawmakers across the country are following UC’s steps.

    A file photo of the University of Arizona. (Epoch Times Staff)

    In June, the University of Arizona announced its Arizona Native Scholars Grant program, which completely covers tuition and mandatory fees for full-time undergraduate students who belong to any of the state’s 22 federally recognized tribes starting this fall. The program would benefit over 400 students and may expand to graduate students in the future, according to the university.

    Oregon launched a free tuition program in May for Native American students from nine federally recognized tribes in the state to remove financial barriers to a college education for the 2022–2023 school year, according to the state’s Higher Education Coordinating Commission.

    Tyler Durden
    Thu, 07/07/2022 – 20:20

  • 88% Of Americans Believe Country On "Wrong Track" Amid Inflation Storm, Poll Says
    88% Of Americans Believe Country On “Wrong Track” Amid Inflation Storm, Poll Says

    The number of Americans in financial distress continues to soar, as the latest Labor Department report shows the consumer-price index at a 40-year high of 8.6% annually. The Monmouth University Polling Institute commissioned a new study that found a majority of Americans believe the nation is on the “wrong track” because of President Biden’s economic policies. 

    Monmouth conducted the survey in late June and asked eleven questions to 978 adults age 18 and older. One question that piqued our interest was Question Six. It asked: “Would you say things in the country are going in the right direction, or have they gotten off on the wrong track?” 

    Not surprisingly, considering the inflation situation and impending economic downturn, 88% of respondents answered “wrong track.” 

    “Economic concerns tend to rise to the top of the list of family concerns, as you might expect, but the singular impact of inflation is really hitting home right now,” Patrick Murray, director of the Monmouth University Polling Institute, wrote in the study. 

    Murray added: “And most Americans are blaming Washington for their current pain.”

    When respondents were questioned about their “current financial situation,” 42% said they were “struggling.” 

    The study results mirror the weak performance of Biden’s job approval data, at a record low of around 38%. 

    Even with 22 straight days of gasoline declines at the pump, the president’s approval rating has yet to turn higher meaningfully — and suggests failed “Bidenomics” has scarred many working-class folks. 

    The state of the consumer is concerning. Many have maxed out their credit cards and drained savings to survive the inflation storm. Millions are on the verge of eviction as they can no longer pay rent. Inflation has crippled many households, and the cure to inflation is a recession, which may inflict even more pain with increasing job loss. 

    High inflation is becoming hard to ignore, and the administration continues to scapegoat Russia for the highest inflation rate in 40 years.

    “We’ve got a long way to go because of inflation, because of – I call it the Putin tax increase – Putin because of gasoline and all that grain he’s keeping from being able to get to the market,” Biden said on Wednesday in a speech to a union group in Ohio.

    Monmouth’s newest survey is a wake-up call for the Biden folks who assured everyone inflation “transitory” had been one of the worst calls in decades. The result is crushing the middle class (or whatever is left). People will take their anger out on “Bidenomics” at the polls and vote with their empty wallets come midterm elections. 

    Tyler Durden
    Thu, 07/07/2022 – 20:00

  • Former NIH Chief Is Now Highest Paid Member Of Most Expensive White House Staff Ever
    Former NIH Chief Is Now Highest Paid Member Of Most Expensive White House Staff Ever

    Authored by Mark Tapscott via The Epoch Times (emphasis ours),

    When Francis Collins departed as Director of the National Institutes for Health (NIH) in December 2021, his legacy included multiple-millions of dollars in secret royalty payments to himself, prominent colleagues like Dr. Anthony Fauci, and hundreds of other scientists, officials, and researchers working under him.

    Dr. Francis Collins, Director of the National Institutes of Health, testifies during the Senate Health, Education, Labor and Pensions Committee hearing in Washington on Sept. 9, 2020. (Greg Nash/Pool/AFP via Getty Images)

    Today, Collins is the highest paid adviser to the president with the most expensive White House staff ever, according to data compiled by the Chicago-based non-profit government watchdog, Open The Books (OTB).

    Collins is paid $300,000 annually as the Acting Science Adviser to President Joe Biden. The new salary represents a 47 percent increase over the $203,500 annual compensation Collins made as NIH Director for 12 years. All salary figures were obtained by OTB under the Freedom of Information Act (FOIA) from the U.S. Office of Personnel Management (OPM).

    Earlier this year, The Epoch Times first reported that OTB uncovered more than 1,600 NIH officials, scientists, and researchers who received an estimated $350 million in secret royalty payments from sources outside the government that the agency refuses to identify.

    The payments were made between 2010 and 2020, including all but a couple of years of Collins’ tenure.

    “We also find that during this period, leadership at NIH was involved in receiving third-party payments. For instance, Francis Collins, the immediate past director of NIH, received 14 payments. Dr. Anthony Fauci received 23 payments, and his deputy, Clifford Lane, received eight payments,” OTB President Adam Andrzejewski told The Epoch Times.

    Collins’ successor as NIH Director, Dr. Lawrence Tabak, admitted to Congress in May that the secret royalty payments have “the appearance of a conflict of interest,” but he claimed the agency has sufficient internal safeguards to prevent abuse.

    Federal personnel law and regulations bar government employees from having either actual conflicts of interest or the appearance of conflicts in their decision-making as public servants.

    As was his departure from NIH, Collins’ move to the White House was accompanied by controversy. Normally, the president’s Chief Science Adviser is also Director of the White House Office of Science and Technology Policy (OSTP).

    But when Biden announced Collins’ appointment in February, the chief executive also announced that he was promoting then-OSTP Deputy Director Alondra Nelson to head the office, thus effectively installing two individuals in what had previously been a single position.

    Both positions—Science Adviser to the President and OSTP Director—were previously filled by Eric Lander, who resigned after it was reported he bullied staff members under his supervision.

    Technically, Collins is a detailee to the White House, as are the second- and third-highest paid White House advisers. Those include Luisa Paiewonsky, Senior Policy Adviser for Transportation at $191,300, and Stephanie Sykes, Director of Intergovernmental Affairs for Infrastructure Implementation at $183,100. Detailee salaries are included in the White House report to Congress on its employment costs.

    The data on the White House salaries was also made public by OTB in a report on July 1.

    There are 23 regular White House employees with the title of Assistant to the President, all paid $180,000 annually, including White House Chief of Staff Ron Klain. The average White House salary is $98,649, with both detailees and regular employees included in the calculation.

    In his first year in the Oval Office in 2021, Biden’s White House staff included 560 individuals at a cost of $49.6 million, the highest ever reported since 1995 when such data was first reported.

    President Donald Trump spent $39.5 million on 377 White House staffers in his first year in office, while President Barack Obama hired 487 White House staff members in his first year at a cost of $49.4 million. The Trump and Obama figures are adjusted for inflation, according to OTB.

    Biden’s White House staff total is almost certain to be lower at the end of 2022 than it was in 2021, because of the exodus of more than 80 individuals in recent months. Even so, OTB projects that the Biden White House staff costs will continue to be the highest ever.

    Read more here…

    Tyler Durden
    Thu, 07/07/2022 – 19:40

  • Viral Video Shows South Korea's Next-Gen Fighter On Runway
    Viral Video Shows South Korea’s Next-Gen Fighter On Runway

    A video of South Korea’s next-generation fight jet performing ground tests went viral on the internet this week, ahead of the aircraft’s first scheduled flight. 

    YouTuber Korea Defense Blog uploaded the footage of the KF-21 Boramae (Korean for “Hawk”) taxing at Sacheon Airport, located in the South Gyeongsang Province. The airport is adjacent to Korea Aerospace Industries (KAI), the developer and manufacturer of the fighter jet that is an inexpensive, less-stealthy alternative to the Lockheed Martin F-35 and F-22 Raptor. 

    Six prototypes of the KF-21 are being built to support flight testing through 2026 when series production is expected to begin. A Local Korean news media outlet expects the first flight on July 22. 

    Even though the new fighter jet appears stealthy, it’s considered a 4.5 generation fighter, not quite a 5th gen fighter. It’s made to replace the Republic of Korea Air Force’s (ROKAF) aging fleet of F-4E Phantom IIs and F-5 Tigers. 

    The KF-21 will be ROKAF’s domestic-made fighter while its fleet of 40 US-made F-35As — first jet delivered by Lockheed Martin in 2018 — became operation this spring. South Korea is modernizing its military force as a show of force against North Korea. It conducted joint military drills with the US this week. 

    ROKAF is expected to deploy 40 KF-21s by 2028 and 120 by 2032, while 50 will be sent to Indonesia. 

    Modernization of the military comes as South Korea’s newly elected President Yoon Suk-yeol warned Wednesday to “promptly and sternly” retaliate against the North amid growing concerns Kim Jong-un is preparing to conduct its first nuclear test in five years.

    Tyler Durden
    Thu, 07/07/2022 – 19:20

  • US Rail System Still Deteriorating
    US Rail System Still Deteriorating

    By Rick Paterson of Loop Capital Markets, first published in Railway Age

    We’re now in the second half of 2022, when the four major U.S. Class I’s have committed to turning their operations around, but the current state of play is not encouraging. Only Union Pacific has made any progress in recent months, but that has been from a low base and fading somewhat over the past two weeks. We would regard UP and Norfolk Southern as now in a “steady state” and it’s the other two we’re more worried about in terms of trajectory.

    BNSF’s intermodal business, in particular, is really struggling and in no shape to handle peak season volumes, which typically start around mid-August. Last week, BNSF Intermodal hit new lows in terms of network velocity (28.9 mph vs. 32.3 average in 2021) and on-time performance (only 57% of containers deramped within 24-hours of schedule), and a new high in terms of intermodal cars sitting idle for 48-hours or longer (1,610 out of 19,969 intermodal cars-on-line). To be fair, weather and other external factors had an impact. More broadly, the full system has seen record trains holding for crews over the last six weeks and a high in recrews to 1,789 at a recrew rate of 13.4% last week.

    Over in the east, CSX is coming off two bad weeks, recording multi-year lows in velocity and multi-year highs in trains holding for crews, terminal dwell, and the proportion of cars-online sitting idle for 48 hours or more. Last week on-time performance in its manifest network hit a new record low of 64%.

    While it pains us to recount these statistics (download the complete State of the Rails report below), for what it’s worth we’re confident both BNSF and CSX have the talent to turn this around and fully expect them to do so, but you can’t start getting better until you stop getting worse and more patience will, unfortunately, be required from all of us.

    Fourth of July Double-Edged Sword

    Last week we talked about 4th of July as both a blessing and a curse for the US railroads and we’ll dig into that a little more here. On the positive side, the holiday on Monday, subsequent four days of heavily reduced customer activity, and bookending weekends represents the second biggest drop in volume pressure of the year, behind of course the Christmas to New Years period. Historically, weekly volumes temporarily subside by 14% at NS, 13% at CSX, 11% at UP, and 8% at BNSF. These are big drops in volume pressure over a 9-day period, which is both positive and badly needed given the current state of affairs. However…

    This period also represents peak summer vacation season, and the networks can obviously ill-afford to lose crews during a crew capacity crunch. In terms of putting some numbers around it, if we look at the monthly seasonality in the four years prior to the pandemic, midmonth crew headcount fell by 0.5% on average from mid-June into mid-July for the US rail industry. For some reason it’s more pronounced in the east, with CSX and NS down 3.3% and 0.8%, respectively, versus -0.2% at UP and +0.5% at BNSF. Clearly these mid-month statistics also understate the crew shortfalls over the first ~nine days of July. By July 15th the heavy vacation effect has partially normalized.

    The railroads are of course well aware of this dynamic and no doubt doing all they can to buy out/stagger/delay vacations next week, but it likely won’t be completely successful and we’re still looking at a situation where the opportunity try to improve operations during the volume pressure reprieve will be diluted by temporarily increased crew scarcity.

    Crew Deficit: ~4,100

    Updating our crew models with the most recent data points for network velocity (last week) results in the following updated estimates with regard to the minimum number of additional crews required to trigger a service recovery. We’ve regressed slightly, with net velocity for the four major systems slightly slower last week, which pushes our estimated crew deficit from ~4,000 to ~4,100.

    In terms of predicting the order in which these systems operationally inflect for the better, look at the % Deficit column on the far right. The smaller the number, the closer to recovery.

    Some of the railroad’s T&E crew headcount numbers (Actual Crews) include trainees, which are higher as a percentage of total now than historically, which in turn makes the crew deficit numbers look slightly better (smaller) than they actually are. When railroads are running poorly, crew capacity is diluted by non-productive crew starts, such as deadheads (repositioning crews by road transport) and recrews (replacing a crew due to an unanticipated expiration of the allowable 12 hours). It will likely take several months before conductor graduates in the field are satisfactorily productive.

    Tyler Durden
    Thu, 07/07/2022 – 19:00

  • WSJ Op-Ed Pushes 'Rebuilding Relations' With China, Ignoring Overwhelming Threats
    WSJ Op-Ed Pushes ‘Rebuilding Relations’ With China, Ignoring Overwhelming Threats

    Sure, China spies on Americans, a lot. And Beijing is eclipsing the West in R&D after years of corporate espionage. And yes, FBI Director Christopher Wray may have said “no country poses a greater threat than Communist China” over the agency’s 1,000 investigations involving theft of US technology.

    And China’s “deepening strategic partnership” with Russia may pose “serious challenges” to global stability, according to NATO.

    And OK, China is holding over a million ethnic minority Muslims in concentration camps.

    And according to Kyle Bass, China’s ‘digital yuan’ is the biggest threat to the West.

    And the sitting US president’s brother and crack-addict son Hunter may have handed Beijing massive leverage over the first family following shady dealings with CCP-linked executives.

    BUT…

    We should overlook all of that in order to ‘improve US-China relations,’ according to a Wednesday Op-Ed in the Wall Street Journal by the CEO of a 102-year-old insurance firm operating out of Shanghai.

    Maurice R. Greenberg. Chairman and CEO of C.V. Starr & Co. Inc.

    Let’s hear Maurice out!

    The deteriorating state of affairs between the U.S. and China has destabilized the most important bilateral relationship in the world. Many Chinese companies do business in the U.S., as do American companies in China, across all sectors. Hundreds of billions of dollars in goods and services are exchanged annually that present tremendous benefits to both economies.

    We should build on that. It is in our national interest, now more than ever, to do all we can to improve U.S.-China relations. My company was founded by Cornelius Vander Starr, an American businessman, in Shanghai more than 100 years ago. I understand that opposing worldviews make attempts to establish a constructive dialogue difficult, but given what is at stake, it only makes sense to try. -WSJ

    To that end, Greenberg says “we” (whatever that means) have established “a small group of senior US businesses and policy leaders who have experience in China” and who want to “have a more constructive relationship” (whatever that means) with Beijing – which we suppose they think will stop all of the IP theft, or at least allow Greenberg and friends to continue enriching themselves whilst turning a blind eye.

    “Our new group will help foster a measured but frank exchange between the U.S. and Chinese governments on issues of mutual concern,” Greenberg claims, citing a “long history of collaboration” between the US and China predating World War II.

    And of course, Greenberg blames the Trump administration for ‘eliminating bilateral channels’ between governments, which he says increased the level of differences and mistrust.

    So, orange man bad. China actually good.

    Greenberg has provided a handy list of his new pro-China consortium:

    Our founding members include the following:

    • Maurice R. Greenberg, Chairman and CEO, C.V. Starr & Co.
    • Craig Allen, president, U.S. China Business Council
    • Max Baucus, former U.S. ambassador to China
    • William Cohen, former secretary of defense
    • Thomas Donohue, former president and CEO, U.S. Chamber of Commerce
    • William Ford, chairman and CEO, General Atlantic
    • Dan Glaser, president and CEO, Marsh McLennan
    • John Hamre, President and CEO, Center for Strategic and International Studies
    • Carla Hills, former U.S. trade representative
    • Ken Langone, co-founder, The Home Depot Inc.
    • Joseph Lieberman, former U.S. Senator
    • Stephen Orlins, president, National Committee on U.S. China Relations
    • Stapleton Roy, former U.S. diplomat specializing in Asian Affairs
    • Frances Townsend, former U.S. homeland security adviser

    Perhaps they can get John Cena to apologize in Mandarin whenever Americans offend Xi Jinping?

    Tyler Durden
    Thu, 07/07/2022 – 18:40

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