Individual Economists

Realtor.com Reports Active Inventory Up 33.3% YoY; New Listings Up 10.4% YoY

Calculated Risk -

What this means: On a weekly basis, Realtor.com reports the year-over-year change in active inventory and new listings. On a monthly basis, they report total inventory. For April, Realtor.com reported inventory was up 30.4% YoY, but still down almost 36% compared to April 2017 to 2019 levels. 
 Now - on a weekly basis - inventory is up 33.3% YoY.

Realtor.com has monthly and weekly data on the existing home market. Here is their weekly report: Weekly Housing Trends View—Data Week Ending April 27, 2024
Active inventory increased, with for-sale homes 33.3% above year-ago levels.

For the 25th straight week, there were more homes listed for sale versus the prior year, giving homebuyers more options. As mortgage rates have climbed to new 2024 highs, we could see sellers adjust their plans, since nearly three-quarters of potential sellers also plan to buy a home.

New listings–a measure of sellers putting homes up for sale–were up this week, by 10.4% from one year ago.

Since February, the number of homes newly listed for sale has surpassed year ago pace by double-digit with the exception of a few weeks around this year’s spring holidays. As reported in the Realtor.com April housing report, newly listed homes trailed behind every prior year except for the pandemic-induced starting point of 2020 and the record low of 2023.
Realtor YoY Active ListingsHere is a graph of the year-over-year change in inventory according to realtor.com

Inventory was up year-over-year for the 25th consecutive week.  
However, inventory is still historically very low.
New listings remain below typical pre-pandemic levels although increasing. 

Turkey Halts All Trade With Israel As Relations At Breaking Point

Zero Hedge -

Turkey Halts All Trade With Israel As Relations At Breaking Point

For months, relations between Turkey and Israel have been on the brink of breaking point. Already there has been the recalling of ambassadors, inflammatory rhetoric exchanged between leaders, and then things got more serious when Turkey a month ago moved to restrict 54 products from being exported to Israel until a Gaza ceasefire can be reached.

But Turkey's government on Thursday has taken the next big step, halting all exports and imports to and from Israel, according to Bloomberg which cited Turkish government officials. It has begun effective today, but Ankara has yet to officially announce the dramatic move.

Israeli Foreign Minister Israel Katz has confirmed that the breaking headlines are accurate. He said that Ankara has already begun to block Israeli imports and exports at Turkish ports.

Katz has ordered the foreign ministry to immediately pursue alternatives for trade which focus on "local production and imports from other countries."

Bilateral trade volume between the two countries, which prior to Oct.7 were enjoying warmer relations, had stood at $5.4 billion last year.

  • Turkey sells $5B-$7B of exports to Israel every year.
  • Israel sells $2B-$3B of exports to Turkey every year.

But President Recep Tayyip Erdoğan has been unrelenting in his attacks on Israel and directed against Netanyahu personally. 

In March, he went so far as to suggest the Israeli prime minster should be assassinated for overseeing war crimes in Gaza and against Muslims.

 In a prior election rally the Turkish president vowed to "send [Netanyahu] to Allah to take care of him, make him miserable and curse him."

This week Turkish Foreign Minister Hakan Fidan announced Turkey will join South Africa’s case against Israel before the Hague-based International Criminal Court (ICC).

Source: Bloomberg

So it appears at this point Turkey is waging both full-scale diplomatic and economic war on Israel. This is unprecedented for a NATO member, which also happens to have the second largest military within the Western military alliance, and is sure to put Western officials in an awkward spot.

Tyler Durden Thu, 05/02/2024 - 12:35

Saudi Arabia Worried About Islamist Uprising As US-Backed Normalization With Israel 'Close'

Zero Hedge -

Saudi Arabia Worried About Islamist Uprising As US-Backed Normalization With Israel 'Close'

Via The Cradle

Arrests of Saudi citizens over social media posts related to 'Israeli genocide' in Gaza have markedly increased in recent months, as Riyadh is reportedly concerned that "Iran and Islamist groups could exploit the conflict to incite a wave of uprisings," according to people familiar with the matter who spoke with Bloomberg.

Recent arrests include "an executive with a company involved in the kingdom’s Vision 2030 economic transformation plan," who reportedly expressed views on Gaza deemed "incendiary," an unnamed media figure who said "Israel should never be forgiven," and a citizen who called for the boycott of US fast food chains in the kingdom.

Image source: Reuters

According to one of Bloomberg's sources, over the past six months, there has been a "significant increase" in the number of prisoners entering a maximum-security prison south of Riyadh. The New York-based publication says this account was corroborated by diplomats in the Saudi capital and human rights organizations who have tracked a "spike in social media-related arrests" since 7 October.

"The Saudi arrests for Gaza-related posts indicate Prince [Mohammed bin Salman's] regime will take a hard line against citizens not toeing the line when it comes to normalizing ties with Israel," Bloomberg reports.

In a visit to the Gulf kingdom on Monday, US Secretary of State Antony Blinken said that intensive work has recently been done toward a Saudi–Israel normalization deal, which he said is "potentially very close to completion."

Nevertheless, on Wednesday, the Guardian reported that Riyadh has devised a "more modest" defense pact with Washington as authorities prepare to move past Israeli normalization over Tel Aviv's intransigence regarding the formation of an independent Palestinian state and their determination to assault Gaza's southernmost city of Rafah.

The British daily described this "Plan B" as a joint US–Saudi effort to "contain Iranian expansionism and [as part of] Washington’s ‘great-power competition,’ particularly with China."

Moreover, Israeli media on Thursday cited a source in the Saudi royal family as saying that the kingdom sent a message to Tel Aviv stating that any military operation in Rafah "would be a big mistake and would push normalization between the two parties away."

"Riyadh will appear as a traitorous country in that case," the Israeli report adds, as Saudi leaders reportedly believe "Saudi Arabia will not be able to normalize relations with Israel if there is no Palestinian state."

Tyler Durden Thu, 05/02/2024 - 12:15

Peloton CEO Stepping Down Following 92% Stock Plunge In Two Years 

Zero Hedge -

Peloton CEO Stepping Down Following 92% Stock Plunge In Two Years 

Barry McCarthy, CEO of Peloton Interactive, is stepping down after the company's stock plummeted 92% since he took over in a bid to revitalize the connected fitness company known for slapping iPads on stationary bikes and charging high markups. 

In February 2022, McCarthy—a former Spotify and Netflix executive—took over from co-founder John Foley. He attempted to turn around the company, which had experienced thousands of layoffs, management shake-ups, and outsourcing business as the Covid pop in demand faded. 

However, those efforts failed when Peloton announced a new restructuring program on Thursday. The struggling company plans to cut 15% of staff, or about 400 workers, and reduce its retail footprint to save $200 million by the end of 2025. 

"This restructuring will position Peloton for sustained, positive free cash flow, while enabling the company to continue to invest in software, hardware and content innovation, improvements to its member support experience, and optimizations to marketing efforts to scale the business. Upon full implementation, the company expects the plan to result in reduced annual run-rate expenses by more than $200 million by the end of its 2025 fiscal year," the company wrote in a press release. 

A series of product recalls over safety issues only added to problems for McCarthy as lower sales and profits continued sliding. The share price has plunged 92% during the CEO's tenure.

Besides a new restructuring program, the company also reported it lost $167.3 million, or 45 cents per share, for the third quarter. That's better than the $275.9 million, or 79 cents per share, in the same quarter last year. Revenue totaled $717.7 million, below the average Wall Street estimate of $719.2 million tracked by Bloomberg. 

Here's a snapshot of third-quarter results (courtesy of Bloomberg): 

  • Revenue $717.7 million, estimate $719.2 million

  • Connected fitness revenue $279.9 million, estimate $288.2 million

  • Subscription revenue $437.8 million, estimate $429.7 million

  • Connected fitness subscribers 3.06 million, estimate 3.08 million

  • Paid digital subscribers 674,000, estimate 742,266

  • Adjusted Ebitda $5.8 million, estimate loss $25 million

  • Loss per share 45c

  • Cash flow from operations $11.6 million vs. negative $40.9 million y/y, estimate negative $29.6 million

Peloton also lowered its full-year revenue guidance by $25 million to a range of $2.675 billion to $2.7 billion, a dip from last year's $2.8 billion.

Here's a snapshot of the full-year outlook (courtesy of Bloomberg): 

  • Sees revenue $2.68 billion to $2.70 billion, saw $2.68 billion to $2.75 billion, estimate $2.71 billion (Bloomberg Consensus)

  • Sees adjusted Ebitda loss $5.0 million to $20.0 million, saw loss $25 million to loss $75 million, estimate loss $62.9 million

  • Sees connected fitness subscribers 2.96 million to 2.98 million, saw 2.99 million to 3.01 million, estimate 3.04 million

Here's what Wall Street analysts are saying (list courtesy of Bloomberg):

Bloomberg Intelligence, Geetha Ranganathan

  •  The headcount cuts will aid free cash flow "yet the core issues remain, namely the weakness in demand and uncertainty over subscription growth, with 44,000 subscriber losses in 3Q"

JPMorgan, Doug Anmuth

  • Says he's encouraged by the company returning to positive free cash flow, and reporting lower operating expenses and positive adjusted Ebitda 

  • In addition, "the cost reductions announced today should better align the cost profile to PTON's current revenue trends & help make debt refinancing increasingly likely, which should help the equity story"

  • Rates overweight with PT $8

BMO Capital Markets, Simeon Siege

  • "From our outsider's viewpoint, we continue to believe growth is behind us and focusing on bear-hugging brand loyalists/walking away from expensive growth hopes can improve FCF/Ebitda (seemingly happening)"

  • If this happens with new management, shares look undervalued, but if growth remains new management's priority, "we worry about sustained FCF/looming debt questions."

  • Rates market perform with PT $7.50

Peloton's recovery depends on another Covid lockdown by the government that shuts down businesses and forces everyone into their homes for months. 

Tyler Durden Thu, 05/02/2024 - 11:55

Biden Satisfies No One With Lackluster Speech Decrying 'Antisemitism & Islamophobia'

Zero Hedge -

Biden Satisfies No One With Lackluster Speech Decrying 'Antisemitism & Islamophobia'

Summary: Last night, CNN spent its prime time segment decrying the Democratic president's "radio silence" on the Gaza-related campus protests and chaos. MSM pundits have pointed to his lack of leadership as violence at times erupted from UCLA to Columbia to a number of elite schools. 

As expected, Biden began by trying to chart a kind of middle course condemning "antisemitism" and "Islamophobia"... though many conservatives have pointed out it's only the former they are seeing evidence of during these campus protests.

"Dissent is essential to democracy. But dissent must never lead to disorder or denying the rights of others... no place for hate speech in America," Biden said. The line about "denying the rights of others" appears a very vague reference to students occupying buildings, and denying the ability of tuition-paying students to go to their classes, libraries, or to take exams. 

"In moments like this, there are always those who rush in to score political points. But this isn’t a moment for politics. It’s a moment for clarity. So let me be clear…Violent protest is not protected. Peaceful protest is."

"Destroying property is not a peaceful protest, it’s against the law. Vandalism, trespassing, breaking windows, shutting down campuses, forcing the cancellation of classes and graduation. None of this is a peaceful protest, threatening people, intimidating people," Biden said.

We should note that Biden's 'middle way' attempt (akin to "good folks on both sides" rhetoric that the Left gets angry about) is unlikely to satisfy either side. In the end, this lackluster speech is not going to make the encampments disappear, or the protesters disperse. In fact, he has most certainly lost almost the entirety of the Progressive vote, and increasingly young voters as well.

Update: Sure enough, it is about the protests, which apparently have had zero impact on anything as expected:

  • *BIDEN: RULE OF LAW, FREEDOM OF SPEECH MUST BOTH BE UPHELD
  • *BIDEN: DISSENT MUST NEVER LEAD TO DISORDER, DENIAL OF RIGHTS
  • *BIDEN: RIGHT TO PROTEST DOESN'T MEAN RIGHT TO CAUSE CHAOS
  • *BIDEN: NATIONAL GUARD SHOULD NOT INTERVENE ON CAMPUS PROTESTS
  • *BIDEN: NO CHANGE IN MIDDLE EAST POLICY OVER CAMPUS PROTESTS

* * *

The White House has announced that President Biden will deliver unscheduled remarks at 10:30am ET (so he is already about 30 minutes late). It is unclear what Biden's handlers will feed the teleprompter but it is a very safe bet that the university protests around the country will be a key topic... pause.

Tyler Durden Thu, 05/02/2024 - 11:48

Yen Carry Trade Ever More Exposed To Rising FX Volatility

Zero Hedge -

Yen Carry Trade Ever More Exposed To Rising FX Volatility

Authored by Simon White, Bloomberg macro strategist,

Rising volatility in USD/JPY will make the yen carry trade less attractive. Dollar-yen is now more correlated with US 2-year yields compared to the 10 year, meaning FX volatility is likely to keep rising the closer the Federal Reserve gets to making its first change in rates.

It’s getting precarious for yen carry traders. Twice in recent days has Japan been suspected of intervening to strengthen the yen, with the latest occurring not long after Wednesday’s Fed meeting, where the FOMC pushed back against further rate hikes and tapered quantitative tightening more than expected.

The carry trade depends on rate differentials. Traders borrow the yen, swap it for dollars, i.e. buy USD/JPY, then use the proceeds to buy a US asset, such as T-bills or Treasuries. But that leaves them long USD/JPY and therefore exposed to falls. A big enough move in spot could wipe out the profit from the US versus Japanese rate spread.

That’s why the volatility of the currency matters to carry traders. If it is too high, then the trade becomes too risky. Which is one of the reasons, as Paul Dobson mentions, that the MOF likely prefers to intervene when market liquidity is low.

Adjusting the US-Japan real rate differential for USD/JPY volatility shows the measure is still high, but it is beginning to fall. The more vol rises, the more it will keep falling (other things equal).

Aside from the intentional introduction of vol premium from intervention, USD/JPY volatility is likely to pick up more the closer the Fed gets to making its next interest-rate move – which is more likely to be a cut if they shift rates this year.

The reason why is that USD/JPY is now more correlated to US 2-year yields than 10-year yields. Since the Fed started hiking in 2022, and the yield curve kept inverting with the 10-year UST’s yield falling versus the 2-year, the latter’s yield has been more correlated to USD/JPY.

Shorter-term yields are likely to get more volatile, which will feed into FX volatility and make the yen-dollar carry trade less attractive.

Still, carry is a moreish drug, and it’s unlikely to be enough to completely derail the trade. The endgame’s not likely to come until the Fed cuts rates – given the US Treasury’s swelling interest bill and the impact on market liquidity, the likelihood they do is increasing, despite rising inflation.

Tyler Durden Thu, 05/02/2024 - 11:35

US Factory Orders Rise In March... But February Saw Yet Another Downward Revision

Zero Hedge -

US Factory Orders Rise In March... But February Saw Yet Another Downward Revision

The roller-coaster ride of US durable goods and factory orders continued in March (final data just released) as the flip-flopping data series

Having plunged by the most since COVID lockdowns in January, US factory orders continued to accelerate in March, +1.6% MoM (as expected) - but February was revised lower... again. This pushed the YoY factory orders up 1.7% (nominal)...

Source: Bloomberg

This is the 17th monthly downward revision in the last 22 months... come on!!!

Source: Bloomberg

Core Factory Orders also rose MoM (+0.5% vs +0.2% exp)...

Source: Bloomberg

The final durable goods orders data prints for March were in line with the preliminary data but more problematically - Capital Goods Shipments Non-Defense Ex-Air was flat MoM, downwardly revised from the initial print...

Source: Bloomberg

...strongly suggesting the capex cycle is stalling.

Tyler Durden Thu, 05/02/2024 - 10:11

Why the FED Should Be Already Cutting

The Big Picture -

 

 

The Fed held its benchmark Federal-Funds rate steady yesterday at 5.25% – 5.5%, leaving the possibility of cuts in the future. Jerome Powell repeated his “Data Dependent” mantra. “Persuasive evidence” that higher interest rates were no longer necessary to bring down inflation is what the FOMC wants, and today I want to share a few pieces of that evidence.

Our starting point is the shelter component of the Consumer Price Index. At about 40%, Shelter is the largest portion of the CPI. As the Bureau of Labor Statistics (BLS) explains:

“The data used as inputs in the construction of the index for shelter, as well as the indexes for rent and OER, are collected in two surveys. The Consumer Expenditure (CE) Survey asks households the share of their budget which goes towards different categories of goods and services, and is subsequently used by the CPI program to create weights for index estimation. The Housing Survey collects price observations of rental housing units across the United States.”

Here is the BLS table showing the weighting:

Let’s hold the problems with survey data for another post, and instead zoom in on actual measures of rents.

As our chart (top) shows, the CPI model that measures rent year over year appears to lag other real-time measures by 18 months. The Apartment Rent Index peaked in November 2021 at ~17% year over year; as of April 2024 its down -0.8% year over year. The Zillow Observed Rent Index, with a different mix of rental apartments and houses, peaked around March 2022 at about 15%; it is now at about +3.8% year over year.

BLS measures of Shelter peaked much later, around May 2023 — a lag of 14-18 months. There are several technical reasons why OER lags so much in the BLS measure of shelter inflation — some of the lag is in how the BLS data is collected and assembled, but hold that aside for a moment. I want to focus on a very important aspect that makes the BLS measure of shelter inflation data so different from the observed rents like the Apartment Index and Zillow.

In a word, Renewals.

Almost two-thirds of all existing leases for apartments or house rentals get renewed. Nearly all of these renewals were signed one or two years ago. Leases are contracts, and they lay out the specific terms for renewals within the document.

What rates do you think landlords built into their lease renewals 12-24 months ago when they were drafting and negotiating those 2022 and ’23 leases? They obviously reflected the inflation rates then — which were peaking.

What do contracts negotiated and executed two years ago have to do with the rate of inflation today? You might assume “nothing,” but as we see in the BLS data, it has an outsized impact. It is very visible in BLS’ New Tenant Rent Index — that data, unlike OER, does not include renewals.

No surprise, it too peaked in 2022, and is now at +0.42% year over year:

 

Back out shelter, which is overweighted by renewals, and the CPI is at 2.3%:

 

Where the rubber meets the road is in mortgage rates: 61% of all homeowners have a mortgage; of those homeowners with mortgages, 78.7% have rates at or below 5%. Consider also 59.4% are at or below 4% mortgage rate. It should be well understood by now that these rates have become golden handcuffs, locking people who might want to move (trade up, new location, etc.) in place.

Going from a 3.75% mortgage rate to current rates of 7.5% will increase your monthly payments by about 50% — for the same-priced house! Imagine moving up to a more expensive house — one that might be larger or in a nicer neighborhood; it would double or event triple your mortgage expenses even for a modest increase in price.

This is why single-family house inventory is down 75% from its peak of 4 million annually to about 1 million today. That lack of supply has kept prices elevated. Higher rates not only are affecting existing home supplies, it is limiting new home construction, and making that more expensive as well.

I said this a few years ago, but it bears repeating here: If the Fed wants lower inflation, they should be lowering rates now.

 

 

 

 

Previously:
How the Fed Causes (Model) Inflation (October 25, 2022)

For Lower Inflation, Stop Raising Rates (January 18, 2023)

CPI Increase is Based on Bad Shelter Data (January 11, 2024)

How Everybody Miscalculated Housing Demand (July 29, 2021)

 

 

Sources:
Fed Says Inflation Progress Has Stalled and Extends Wait-and-See Rate Stance.

 

The post Why the FED Should Be <i>Already</i> Cutting appeared first on The Big Picture.

'Unity': Pro-Israel And Pro-Palestine Supporters Chant "F**k Joe Biden" In Solidarity As Democrats In 'Panic Mode' 

Zero Hedge -

'Unity': Pro-Israel And Pro-Palestine Supporters Chant "F**k Joe Biden" In Solidarity As Democrats In 'Panic Mode' 

How it started:

How it's going: 

In early March, President Biden and the Democrats called for the "Unity of all Americans." 

Fast forward to the Marxist revolution spreading like stage four cancer at the nation's colleges and universities, anti-Israel and counter-protesters found common ground, or perhaps a glimpse of solidarity, when both sides were heard chanting "F**K Joe Biden" this week at the University of Alabama. 

"It finally happened. Joe managed to get both sides of the protest to hate him for different reasons," X user Alex The Ghost wrote. 

Others on X agreed... 

The president and the radical left are walking a very fine line between supporting the Marxist kids at schools and their right to protest while simultaneously denouncing antisemitism. The surge in criticism from both the left and the right of the elderly president's Israel policy risks the unity of both sides in their hatred of the president. 

Meanwhile, Axios reports Democrats are in full-blown' panic mode' behind the scenes as campus takeovers by extremists of their own party produce terrible optics ahead of the presidential election in November. 

"The longer they continue, and the worse that they get, the worse it's going to be for the election overall," one House Democrat said.

The House Democrat warned that school chaos will only "bring out [the public's] most conservative side." 

What's clear is that campus protesters are becoming a political liability for Biden and Democrats. 

Republicans are now seizing on the opportunity from New York to California to inform voters that under this administration, the destruction and chaos of America continues. Add this chaos to the long list of failures by the Biden administration, including the migrant invasion, worsening drug overdose crisis, violent crime proliferating across metro areas, disastrous foreign policy moves in Eastern Europe and the Middle East, risking World War III, and, of course, the failure of Bidenomics that has ignited stagflation, crushing America's middle class. 

"[Democrats] were trying to make a big deal out of these Trump trials, but they've taken a back seat" to the protests, John Feehery, a Republican strategist and former congressional aide, told Financial Times

This week, the White House has been awfully silent on the campus takeover crisis. 

"When will the president himself, not his mouthpieces, condemn these hate-filled little Gazas?" Tom Cotton, the Republican senator from Arkansas, told reporters on Wednesday.

"President Biden needs to denounce Hamas' campus sympathizers without equivocating about Israelis fighting a righteous war of survival," Cotton added.

A recent poll showed that 81 percent of voters aged 18 to 35 disapprove of Biden’s handling of the conflict in the Middle East.

Michael Moore, who correctly predicted Trump’s victory in 2016, even issued a plea to Biden urging him to accomplish a ceasefire or face defeat.

We’re going to lose the election. We’re going to lose Michigan if we don’t turn this around. If President Biden doesn’t turn this around, that is going to do more to put Trump back in the White House. And I refuse to have Donald Trump back in the White House,” said Moore.

To sum up, the Democrats are in serious trouble if anti-Israel protesters and counter-protesters begin to march in solidarity around their hatred of Biden.

Tyler Durden Thu, 05/02/2024 - 09:35

US Traders Took Powell's Pivot More Seriously Than Foreigners

Zero Hedge -

US Traders Took Powell's Pivot More Seriously Than Foreigners

Authored by Simon White, Bloomberg macro strategist,

Most of the hawkish tilt in yields and rise in Federal Reserve interest rate expectations this year has come in non-US trading hours. A dovish repricing would therefore require (other things equal) a change of trading direction only in overnight hours when volumes are typically lighter.

US yields have risen steadily since their end-of-December lows. Expectations the Fed was going to make over six rate cuts has dwindled down to barely one. The risk-reward now favors a dovish repricing as liquidity conditions are set to worsen as the year goes on. And that is more likely to come from domestic trading rather than from abroad, if recent history is anything to go by.

We can get hourly data going back to October for US Treasuries and fed funds futures, and separate it out into a US day session and an overnight session (both contracts trade 22-23 hours a day). The chart below shows the cumulative sum of the daily change in the day session and the overnight session for the 10-year yield. This year, almost all of the rise in 10-year yields has taken place in non-US trading hours.

Making the assumption that it’s predominately US-based volumes driving trading in US hours, US-based traders pushed yields lower from their October peak. But there has been little further movement all of this year. In contrast, predominately overseas trading (and no doubt some US-based algos and insomniac traders) has pushed the 10-year yield higher all this year – driving the 80 bps rise in the 10y in 2024.

The delineation between US and non-US trading is even more pronounced when looking at Fed rate expectations. The chart below is the same as the one above, but with the twelfth generic fed funds future, which gives an approximation for what’s priced for the Fed in ~12 months’ time.

Here we can see US-based trading drove the proliferation of rate cuts expected at the end of 2023. Since then, US-based traders have not changed their dovish view.

Almost all of the hawkish tilt this year - eradicating most of the cuts expected - came in trading during non-US hours.

It looks like mainly US-based traders took Powell’s pivot in December more seriously than those predominately based abroad. Either way, risk-reward now favors siding with the domestic team for a more dovish rate outcome than is currently priced.

 

Tyler Durden Thu, 05/02/2024 - 09:15

Unit Labor Costs Soar In Q1 As 'AI Productivity Boom' Fails To Show Up

Zero Hedge -

Unit Labor Costs Soar In Q1 As 'AI Productivity Boom' Fails To Show Up

Remember how AI was going to save the world, give us all more leisure time because of its massive boost to productivity?

Well, in Q1 in the US... it failed to show up as non-farm productivity - or nonfarm employee output per hour - rose at a measly 0.3% annualized rate after an upwardly revised 3.5% gain in the prior period (well below expectations)...

Source: Bloomberg

On the flip-side of that - and echoing the market-worrying ECI data earlier this week - Unit Labor Costs soared 4.7% in Q1 (well above the 4.0% expected and the 0.4% rise in Q4)...

Source: Bloomberg

So wage inflation is confirmed - rising at the fastest pace in a year - as all the gains we have been told to expect from AI just aren't there in the data.

While quarterly productivity figures are quite volatile, a sustained slowdown represents another hurdle for the Federal Reserve’s inflation fight. With interest rates expected to stay at a two-decade high for awhile longer, business investment in equipment will likely continue to be a weak factor in overall economic growth.

Today's data corroborates other data that showed gross domestic product cooled in the first quarter while employment costs rose by the most in a year. As a result, inflation is proving stubborn, supporting the Fed’s pivot to a more hawkish stance that will keep interest rates higher for longer than anticipated.

Of course, Fed Chair Powell told us yesterday that he "doesn't see the stag or the flation" in US data...

Maybe he needs to subscribe to ZeroHedge to see the real picture.

Tyler Durden Thu, 05/02/2024 - 09:05

Lawler: Update on Mortgage Rates and Spreads and also New / Renewal Rents

Calculated Risk -

Today, in the Calculated Risk Real Estate Newsletter: Lawler: Update on Mortgage Rates and Spreads and also New / Renewal Rents

A brief excerpt:
As I’ve written about before, that “new” vs. “renewal” rent growth gap has been observed by publicly-traded companies that are in the residential rental business.

Freddie HPI CBSAOn that score, here are some data from Invitation Homes quarterly earnings supplement on rent growth trends.

Note that while rent increases on new leases were extremely low over the last two quarter, rents on renewals, while down from 2022, were still rising at a relatively rapid pace.
There is much more in the article.

Trade Deficit at $69.4 Billion in March

Calculated Risk -

The Census Bureau and the Bureau of Economic Analysis reported:
The U.S. Census Bureau and the U.S. Bureau of Economic Analysis announced today that the goods and services deficit was $69.4 billion in March, down $0.1 billion from $69.5 billion in February, revised.

March exports were $257.6 billion, $5.3 billion less than February exports. March imports were $327.0 billion, $5.4 billion less than February imports.
emphasis added
U.S. Trade Exports Imports Click on graph for larger image.

Both exports imports decreased in March.

Exports are unchanged year-over-year; imports are up 3.1% year-over-year.
Both imports and exports decreased sharply due to COVID-19 and then bounced back - imports and exports have generally increased recently.

The second graph shows the U.S. trade deficit, with and without petroleum.

U.S. Trade Deficit The blue line is the total deficit, and the black line is the petroleum deficit, and the red line is the trade deficit ex-petroleum products.

Note that net, exports of petroleum products are positive and have been increasing.

The trade deficit with China increased to $17.2 billion from $16.6 billion a year ago.

Joe Biden Says There Are Very Fine People On Both Sides Of The Oct. 7 Debate

Zero Hedge -

Joe Biden Says There Are Very Fine People On Both Sides Of The Oct. 7 Debate

Authored by David Harsanyi via The Epoch Times (emphasis ours),

I condemn the anti-Semitic protests ...” President Joe Biden told reporters after days of anti-Jewish demonstrations at Columbia University and other Ivy League schools. “I also condemn those who don’t understand what’s going on with the Palestinians ...

President Joe Biden speaks during the White House Correspondents' Association (WHCA) dinner at the Washington Hilton, in Washington on April 27, 2024. (Brendan Smialowski/AFP via Getty Images)

Any morally clearheaded American already has a very good idea of what’s going on. Biden is bothsidesing the actions of keffiyeh-wearing terror cheerleaders on Columbia’s Gaza Quad—who target American Jews who have absolutely no bearing on Israel’s actions—with those who refuse to accept the blood libel of “genocide” in Gaza. It is the kind of odious moral relativism one expects to hear from a “Squad” member or clout-chasing far-right “influencer,” not the president.

Hamas, the governing authority in an autonomous Gaza—still supported widely by the Palestinian people—flooded over the border on Oct. 7, 2023, raping, murdering, and kidnapping more than a thousand men, women, and children in Israel, including American citizens. Afterward, Hamas retreated and hid among civilians to generate as many Palestinian martyrs as possible. The Israelis retaliated against this nihilistic death cult, keeping the civilian-to-combatant casualty ratio lower than perhaps any other instance of modern urban warfare.

That’s what’s going on. But because a not-insignificant contingent on the contemporary left is now both anti-Semitic and anti-“colonialist,” the president demanded Israel stop before the job was done. And he is willing to sell out a longtime ally and forsake the lives of American hostages to try to entice the votes in Jew-hating enclaves like Dearborn, Michigan, Yale University, and The Washington Post newsroom.

A number of people have pointed out the similarities between Biden’s condemnations and former President Donald Trump’s post-Charlottesville, Virginia, march “very fine people” comment. It’s a good gotcha. After all, Biden has risibly claimed that Trump’s comments impelled him to run for president (for the third time).

There is, however, a key difference. Trump’s garbled line was almost surely not aimed at tiki-torch neo-Nazis. Believe what you like about Trump’s motivations, but he also later unequivocally condemned the white supremacists on more than one occasion. Biden, on the other hand, can’t even get himself to call out brownshirts without throwing them a bone.

Also, incidentally, unlike the nuts in Virginia, these people will be working at our top law firms, in media organizations and in the State Department. Oh, the president also wants you to pay their loans.

Earlier, The Washington Post, like most outlets, claimed that “Biden denounces antisemitism on college campuses amid Yale, Columbia protests.” While technically true, the framing ignores the president’s equivocation. The denouncement was a pro forma White House Passover press release that spent as much space prattling on about a two-state solution as it did the “protests.” For comparison, Biden’s Ramadan press release noted the “terrible suffering on the Palestinian people,” repeated fake Hamas causality numbers and condemned “Islamophobia,” but said nothing about the widespread outbreak of anti-Semitism.

Then again, Democrats are increasingly incapable of even talking about anti-Semitism without diluting any condemnation with mention of “Islamophobia.”

You might recall a few years back a certain Democratic congresswoman was going on about “Benjamin”-grubbing rootless cosmopolitans hypnotizing the world for their evil. After a handful of Jewish Democrats complained about her rhetoric, then-House Speaker Nancy Pelosi finally agreed to pass a resolution condemning Rep. Ilhan Omar. By the end of debate, of course, the resolution was teeming with platitudes and condemnations of a rainbow of thought crimes, with references to Alfred Dreyfus, Leo Frank, Henry Ford, and “anti-Muslim bigotry,” but not Omar.

We all have a responsibility to speak out against anti-Semitism, Islamophobia, homophobia, transphobia, racism, and all forms of hatred and bigotry, especially as we see a spike in hate crimes in America,” is how Sen. Kamala Harris whitewashed the rising anti-Jewish pronouncements of her party. Which is to say, for years now, Democrats have been downplaying anti-Semitism as it creeped into college campuses, Congress, the Women’s March, Black Lives Matter, and now the mainstream.

And now, here we are. We have a president who can’t make a moral distinction between bigots and their targets.

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

Tyler Durden Thu, 05/02/2024 - 08:45

Thursday Humor: Jobless Claims

Zero Hedge -

Thursday Humor: Jobless Claims

With WARNs high, JOLTS data tumbling - led construction jobs collapsing, and Challenger-Grey layoffs remarkably elevated, why would anyone question the government's official data on jobless claims - that continues to languish (in a good way) near record lows.

Last week saw 208,000 Americans file for jobless benefits for the first time (the same as the prior week), basically flat for the last three years...

Source: Bloomberg

In the real world labor market, 2024 has been a shitshow of layoffs...

1. Everybuddy: 100% of workforce
2. Wisense: 100% of workforce
3. CodeSee: 100% of workforce
4. Twig: 100% of workforce
5. Twitch: 35% of workforce
6. Roomba: 31% of workforce
7. Bumble: 30% of workforce
8. Farfetch: 25% of workforce
9. Away: 25% of workforce
10. Hasbro: 20% of workforce
11. LA Times: 20% of workforce
12. Wint Wealth: 20% of workforce
13. Finder: 17% of workforce
14. Spotify: 17% of workforce
15. Buzzfeed: 16% of workforce
16. Levi's: 15% of workforce
17. Xerox: 15% of workforce
18. Qualtrics: 14% of workforce
19. Wayfair: 13% of workforce
20. Duolingo: 10% of workforce
21. Rivian: 10% of workforce
22. Washington Post: 10% of workforce
23. Snap: 10% of workforce
24. eBay: 9% of workforce
25. Sony Interactive: 8% of workforce
26. Expedia: 8% of workforce
27. Business Insider: 8% of workforce
28. Instacart: 7% of workforce
29. Paypal: 7% of workforce
30. Okta: 7% of workforce
31. Charles Schwab: 6% of workforce
32. Docusign: 6% of workforce
33. Riskified: 6% of workforce
34. EA: 5% of workforce
35. Motional: 5% of workforce
36. Mozilla: 5% of workforce
37. Vacasa: 5% of workforce
38. CISCO: 5% of workforce
39. UPS: 2% of workforce
40. Nike: 2% of workforce
41. Blackrock: 3% of workforce
42. Paramount: 3% of workforce
43. Citigroup: 20,000 employees
44. ThyssenKrupp: 5,000 employees
45. Best Buy: 3,500 employees
46. Barry Callebaut: 2,500 employees
47. Outback Steakhouse: 1,000
48. Northrop Grumman: 1,000 employees
49. Pixar: 1,300 employees
50. Perrigo: 500 employees
51. Tesla: 10% of workforce

Under the hood, California and Massachusetts were the big outliers to the downside (taking New Jersey's place in the hall of fame of made-up data)...

Continuing claims - according to the government - were also flat week on week at 1.774 million Americans, having gone practically nowhere for a year...

Spot the odd one out... (or spot the government-supplied data)...

Source: Bloomberg

Ah, Bidenomics!!

If Trump wins in November, will all this data suddenly be 'allowed' to reflect reality?

Tyler Durden Thu, 05/02/2024 - 08:36

Weekly Initial Unemployment Claims at 208,000

Calculated Risk -

The DOL reported:
In the week ending April 27, the advance figure for seasonally adjusted initial claims was 208,000, unchanged from the previous week's revised level. The previous week's level was revised up by 1,000 from 207,000 to 208,000. The 4-week moving average was 210,000, a decrease of 3,500 from the previous week's revised average. The previous week's average was revised up by 250 from 213,250 to 213,500.
emphasis added
The following graph shows the 4-week moving average of weekly claims since 1971.

Click on graph for larger image.

The dashed line on the graph is the current 4-week average. The four-week average of weekly unemployment claims decreased to 210,000.

The previous week was revised up.

Weekly claims were lower than the consensus forecast.

Will Trump Survive This?

Zero Hedge -

Will Trump Survive This?

Authored by James Rickards via the Daily Reckoning,

This is a highly consequential election year, to say the least. The policy differences between Biden and Trump are enormous. Whether it’s taxes, regulation, borders, energy or foreign policy, the differences couldn’t be clearer.

And though I prefer to focus my analysis on markets alone, I can’t. These days especially, politics plays too great a role in how markets behave.

But this year’s election is about far more than policy.

In the past, the D.C. establishment could live with a typical Republican or Democrat. They knew neither candidate would rock the boat too much if he got elected. Both candidates were cut from the same basic cloth and played by the accepted rules.

But all that goes out the window with Trump.

He’s the most polarizing political figure we’ve seen in our lifetimes. You’d probably have to go back to Andrew Jackson to find a parallel.

And it’s clear that Trump’s political enemies will stop at nothing to keep him out of the White House this time.

Lawfare 

“Lawfare” is their primary tactic. They just want to get Trump convicted of a felony before the election so they can brand him a criminal, believing that the American public won’t elect a convicted felon.

They don’t care if the conviction is subsequently overturned by a higher court. The damage will already be done. And if it trashes the Constitution, Trump’s political enemies are prepared to live with that.

They’re convinced that Trump is the equivalent of Hitler and that he’ll destroy democracy if he’s elected. So in their minds, the ends justify the means. They’ll justify any action, legal or illegal, to ensure his defeat.

They don’t seem to realize that the harder they go after Trump with bogus charges, the more popular he becomes.

I’m not here to defend Trump or oppose him. No doubt, he’s a deeply flawed character with personality traits that alienate many people. But voters don’t expect a billionaire real estate magnate from New York City to be a saint. They vote for him because they think he can get things done.

And under honest democratic elections, the administrative state, or deep state, whatever you want to call it, stays out of it. But that’s not the system we have today.

And that should concern every American, regardless of his or her political affiliation.

Again, it doesn’t matter if you love Trump or hate him. But in a democracy, the people rule. Not the bureaucrats. And if the people elect Trump, then he should be allowed to enact the policies that got him elected. That didn’t happen when he won in 2016.

Stop Trump!

The first two years of his administration were hobbled by the fake Russian collusion hoax and the numerous investigations that resulted. Those investigations showed that there was no collusion between Trump and Russia, but Trump’s enemies didn’t care (and certainly did not apologize).

They just moved on to the next fake scandal, which was the first impeachment over a brief phone call to Ukrainian President Zelenskyy asking about Biden family corruption. It turns out that Biden family corruption was rampant in Ukraine, but that didn’t stop phony “whistleblowers” (actually lawbreakers) like Eric Ciaramella from leaking classified transcripts to Adam Schiff to get the impeachment process going.

Trump was acquitted by the Senate. Then came the second impeachment where Trump was also acquitted. Since leaving office, Trump has been hit with federal criminal charges relating to Jan. 6 and the Mar-a-Lago raid, as well as state criminal charges in New York and Georgia.

Trump’s enemies never quit. They’re also going after Trump’s advisers and confidants. It’s meant to isolate Trump because anyone who advises him will fear they’ll be hauled into court on some bogus charge and have to spend a fortune on lawyers, win or lose.

The latest lawfare tactic has been unveiled against Trump attorney John Eastman. It’s called “debanking.”

Good Luck Living Without a Bank

In Eastman’s case, it started with Bank of America closing his bank accounts for no good reason and with no recourse. Then he turned to his accounts at USAA, which specializes in accounts for military veterans and their families. Shortly thereafter, USAA also closed Eastman’s bank accounts.

We tend to take banking services for granted and don’t think much about what would happen if we were shut out of the banking system. No checks, no savings accounts, no wire transfers, no ATMs, no bank-issued credit cards, no lines of credit or mortgages, etc.

It’s like trying to survive without food or water. It’s impossible. And that’s the whole point. It’s designed to make the victim’s life miserable.

The same thing happened in the U.K. when NatWest and Coutts debanked Nigel Farage, leader of the Brexit movement. Farage fought back and the CEO of NatWest was eventually fired over the incident. But it was a brutal fight and a tough transition for Farage when he suddenly found himself debanked.

Unfortunately, debanking is just an extension of the “woke” cancel culture that’s taken root in much of the West.

Shut up, Bigot!

When we look around at places like New Zealand and Scotland, there seems to be a bizarre competition to see which country can pass the most fascist laws and imitate George Orwell’s dystopia in Nineteen Eighty-Four in the least amount of time.

Scotland has imposed so-called hate crime laws that subject you to imprisonment for exercising free speech if it happens to offend a long list of protected parties. No actual violence or physical act is needed. If you simply say the wrong thing, you can be arrested, fined and imprisoned for “inciting hate.”

A similar law has just passed in Ireland. The Polish government wants to pass a law that makes it a crime to “defame” members of the LBGT community. Of course, the term “defame” is ill-defined and is in the eye of the beholder. Any choice of words, even if derogatory or hurtful by some standard, should be protected by free speech provisions. But in Poland, it may soon land you in jail.

I’ve never understood hate crime laws anyway (and I’m a lawyer). If you murder someone, it’s murder. If you assault someone, it’s assault. Subject to due process of law, you should go to jail if convicted or perhaps face capital punishment.

Prosecutors have to show intent, but what does “hate” have to do with it? The perpetrator may, in fact, hate the victim but that’s not the crime. The crime is assault or murder. Those crimes have been considered crimes for millennia.

Nineteen Eighty-Four Was Supposed to Be Fiction

Adding hate to the definition just blurs the line between thought and action in ways that make it easier for fascist governments to target political enemies with flimsy allegations of “hate” when no actions were involved.

The most egregious example of this trend toward thought crimes is Canada. The chief neo-fascist there is Prime Minister Justin Trudeau. He has proposed a law called the Online Harms Act that expands the definition of “discrimination” to include online speech “likely to foment detestation or vilification of an individual or group.”

What exactly does this law mean by “foment”? Who defines “vilification” or “detestation”? What’s the definition of “group”?

All of these questions will be answered by a new Digital Safety Commission, which will not be bound by “any technical or legal rules of evidence.” If accused, you can be ordered to pay $20,000 to any “victim” and $50,000 to the state with no limit on how many victims might crawl out of the woodwork.

This is practically an invitation for grifters and activists to attack political enemies with fake claims of having been subject to “detestation.” It gets worse. If a court believes you are likely to commit a “hate crime” under this law, you can be placed under house arrest and held in isolation.

In other words, just thinking the wrong thing as imagined by an unaccountable magistrate is enough to put you under house arrest. This is actually worse than what the Thought Police did in Orwell’s novel.

You can expect censorship in the U.S. to increase as we get closer to the November election. Get ready for it.

Nineteen Eighty-Four was supposed to be fiction. Unfortunately, it’s becoming reality.

Tyler Durden Thu, 05/02/2024 - 06:30

Russia Strikes Military HQ In Odessa After Ukraine Attacks Crimea With US-Provided ATACMS

Zero Hedge -

Russia Strikes Military HQ In Odessa After Ukraine Attacks Crimea With US-Provided ATACMS

In yet another among the latest signs that Moscow is escalating its war against Ukraine, pushing sustained strikes deeper into its territory, Russian forces have mounted a large attack against Ukraine's military headquarters for the southern region. 

The ministry of defense confirmed an attack on Ukraine’s Operational Command South headquarters, coming amid stepped up operations against the southern port city of Odessa. RIA Novosti separately confirmed the attack on the Ukrainian HQ in the center Odessa, citing a ballistic missile strike on the city and three explosions, which reportedly killed three people.

This week a Gothic-style building in the southern Ukrainian city of Odesa was also struck.

Just last month, Russian Defense Minister Sergey Shoigu pledged that his forces will step up attacks on warehouses and logistics hubs with West-supplied weaponry. Moscow has also said it will push back the front lines deeper into Ukrainian territory in order to better prevent NATO-supplied longer range missiles from striking inside Russia. It seems the next big target is Odessa, which would greatly expand Russian military hold in the south.

But Russia also seems to be responding to the increased attacks against Crimea. On Tuesday Russian officials said that the peninsula came under attack with US-provided Army Tactical Missile Systems (ATACMS).

It was revealed only within the last week that these long-range systems were secretly transferred to Kiev by Washington in March. Politico previously documented that the White House "quietly approved the transfer of a number of Army Tactical Missile Systems with a range of nearly 200 miles, said a senior Biden administration official and two U.S. officials, allowing President Volodymyr Zelenskyy’s forces to put at risk more Russian targets inside Ukrainian sovereign territory."

A prior, older version of the ATAMCS missiles were sent last year, but the range was reportedly limited to 100 miles. President Biden and his officials throughout the early phase of the war warned Kiev against attacks on Russian territory but this caution seems to have been abandoned by the US administration.

Governor of Crimea Sergey Aksyonov said of the Tuesday attack that the inbound ATACMS were shot down by Russian air defenses. Russia's defense ministry (MoD) specified it shot down six of the missiles. 

Additionally, French-made projectiles were also reportedly shot down elsewhere in the country, with TASS reporting that "Russian air defense systems have taken down 29 Ukrainian drones and five French-made AASM Hammer smart bombs over 24 hours in the special military operation in Ukraine, the Russian Defense Ministry said. Uragan rocket was also shot down."

Ukraine's skies remain by and large undefended and unprotected, which is why President Zelensky is essentially begging for more Patriot anti-air defense systems from the US and Europe. Kiev further wants to see the F-16 program hurried along. 

Ukrainian Air Force spokesman Ilya Evlash on Wednesday told a public broadcaster that the first batch F-16 jets could arrive as early as within weeks, after Orthodox Easter (celebrated on May 5 this year); however, other observers have said that this timetable is a stretch and remains unrealistic.

Tyler Durden Thu, 05/02/2024 - 02:45

Fighting Monsters

Zero Hedge -

Fighting Monsters

Authored by CJ Hopkins via off-guardian.org,

Fighting monsters by serbiandude Published: Jan 3, 2023

So, I gave a little speech about art, and war. The Internationale Agentur für Freiheit, a Berlin art and cultural association, asked me to do that to open their exhibition, Make Art Not War. I couldn’t turn them down.

As my readers may have noticed, I haven’t had very much to say about “The War on Hamas,” or “The War on Gaza,” or “The Liquidation of Gaza,” or whatever you want to call it. (It doesn’t look like much of a “war” to me, but then, nothing really has for quite a while.)

I wrote about it in October and November of last year. And I said a few things about it in my speech. But, mostly, I’ve been trying to keep my mouth shut. I don’t have much to contribute to the … well, I can’t really call it a discussion, or debate, or an argument. It feels like people screaming slogans into each other’s faces, accusing each other of this and that, and calling each other names, and so on. Which … I get why people are inclined to do that. I’m not. But I get why other folks are. So, I think it’s best if I just shut my pie hole (as much as possible) and let folks do that.

It isn’t going to change what’s happening. GloboCap (or whatever you call the system we’re all living under) has been occupying, destabilizing, and restructuring the Middle East for decades. It’s not going to stop. It is going to continue. As the restructuring of the West is going to continue.

GloboCap doesn’t have anything else to do.

Anyway, before I ramble on any further, here’s the English version of the speech I gave at the exhibition. Many thanks to those of you who attended … and apologies again for my German. I’ll get the hang of it one of these days.

Fighting Monsters

The name of this exhibition is “Make Art not War.” So I’m going to say a few things about art, and war. You’re not going to like all of them. Or at least I hope not. If you did, I wouldn’t be a very good artist, but I might be a pretty good propagandist.

I grew up in the 1960s and 70s. In the USA. The war was on television. In Vietnam. Cambodia. Cuba. The Middle East. Then in El Salvador. Nicaragua. Iran. Libya. Yugoslavia. Afghanistan. Iraq. The list goes on and on. I am almost 63 years old. All my life we’ve been at war. Not just Americans. All of us. People. Someone always at war with someone. And all my life there have been other people calling for peace. Protesting the war. Whatever war it was at the time.

If you read a little history, as I like to do sometimes, you will learn that someone has been at war with someone over something since the dawn of civilization. Certainly Western civilization. The history of Western art and literature begins with war. Genocidal war. The Illiad is a poem about a genocidal war. Rape. Mass murder. The slaughter of children. Most of Shakespeare’s plays are about war, or are set during a war, or have something to do with someone killing someone over something.

Some of that history happened right here. There are bunkers below us where people sheltered during the bombing raids in the Second World War. Legend has it the Stasi operated listening stations right here in these rooms. When I first arrived in Berlin, twenty years ago, I lived in a sublet on this street. This was my neighborhood, the Bötzowviertel. There were still bullet holes in the facades of buildings. People died here. Civilians. Children. Women were raped here. Families were dragged out of their homes and sent to the death camps here. This is Berlin. You know the history. I don’t need to recite all the details.

What’s my point? Well, my point is … that is war. Indiscriminate killing. Rape. Mass atrocities. That’s what war is. That is what it has always been. And we’ve been doing it to each other since the dawn of civilization. It is not going to stop. We are not going to stop it. Art is certainly not going to stop it. We are, whether we like it or not, a violent species, human beings. It isn’t all we are, but it is part of what we are. We are also lovers, teachers, healers, artists, and other beautiful things. But sometimes we are vicious killers. Monsters. Genocidal monsters.

A crazy old German philosopher once warned us, “beware that, when fighting monsters, you yourself do not become a monster.” He was joking, of course. There are no monsters. Or, rather, there are only monsters, on every side of every war. In a war, there are no good guys and bad guys. There is just our side and the other side. Our atrocities and their atrocities. And whoever wins gets to write the history.

That’s it. The rest is propaganda. Their propaganda and our propaganda. Of course, our propaganda is not propaganda. Our propaganda is just the truth. Because we’re not monsters. They are the monsters.

This is Day 202 of Israel’s war on Hamas, or its liquidation of Gaza, depending on your perspective. I haven’t said too much about it publicly. I said a few things about it when it began. That didn’t go well. No one was listening. The propaganda from both sides was already deafening. I described the Hamas attack as mass murder. My pro-Palestinian readers didn’t like that. I described Israel as a typical mass-murdering nation-state, no different than the United States of America, Germany, France, Spain, The Netherlands, the Soviet Union, the British empire, the Ottoman empire, the Holy Roman Empire, or any other mass-murdering nation-state or empire. My pro-Israeli readers didn’t like that. Neither side wanted to hear about history. The history of asymmetric warfare, or terrorism, depending on your perspective. The history of nation-states and empires. They wanted to hear a story about monsters. About the monsters on the other side.

I told you you weren’t going to like everything I said, right?

OK, let me say a few things about art now. If you didn’t like what I said about war, maybe you’ll like what I say about art. I can’t speak for other artists, but I’ll tell you why I think I became an artist, and what I have been trying to do as an artist.

I haven’t been trying to stop any wars. Or to pacify the human species. I don’t know how to do either of those things. And I am not a fan of propaganda. I confess, I have engaged in it from time to time, but mostly what I’ve been trying to do is deprogram minds, starting with my own.

We are all, by the time we realize we exist, the products of programming, ideological conditioning. I believe it is the job of artists to undo that, or at least to marginally interfere with it. That’s what art, and artists, did for me. They introduced me to my mind. My programmed mind. They forced me to think, and to see, and listen. They taught me to question, to pay attention. They dared me to deprogram my mind, and provided me with the tools to do it. OK, sure, some mind-altering drugs also helped, but it was artists that introduced me to those drugs. Then they introduced me to the monster I’ve been fighting.

I have been fighting this monster, in my art, in my mind, and out in the world for as long I remember. You have to fight it everywhere at once. To fight it in your mind, you have to fight it out in the world. And to fight it out in the world, you have to fight it in your mind.

Let me tell you about the monster.

The monster is legion. It goes by many names. It wears many faces. They change over time. William S. Burroughs called it “The Control Machine.” Some people call it the corporatocracy. I call it global capitalism. The monster doesn’t care what we call it. It doesn’t care who we are, what our politics are, or which side of what war we think we are on. It doesn’t care what we believe, which religion we profess. It couldn’t care less how we “identify.”

All it cares about is power. All it cares about is control.

It is everywhere, and nowhere. It has no country. No nationality. It doesn’t exist. It is everything, and nothing. It is the non-existent empire occupying the entire planet. It has no external enemies because there is no outside, not anymore. So there is no real war. There are only insurrections, carried out by rebels, traitors, terrorists.

The monster, our non-existent empire, is the first global empire in human history. It is not a group of evil people. It is maintained by people, but they are all interchangeable. It has no headquarters. There is no emperor. There isn’t any “Bastille” to storm. It is a logos. A system. An operating system.

It has no politics, no ideology. Its official ideology is “reality.” Thus it has no political opposition. Who would argue against or oppose “reality”? Lunatics. Extremists. The terminally deranged. And thus there are no dissidents, no opposing political parties. There are only apostates, heretics, blasphemers, sowers of discord, “reality” deniers.

It manufactures “reality.” Whatever “reality” it needs. The War on Terror. The War on Populism. The War on the Virus. The War on the Weather. The War on Hate. The War on Whatever. It doesn’t matter. It is all the same war. The same “Clear-and-Hold” op. The same counterinsurgency. It has been for about 30 years.

If things seem crazy, if you’re wondering what’s happening, that is what’s happening. That is all that is happening. That is all that has been happening since the end of the Cold War.

The empire is eliminating internal resistance, any and all forms of internal resistance. The monster is monsterizing everything and everyone. Transforming societies into markets. It doesn’t have anything else to do. It is erasing values. It is dissolving borders. It is “sensitivity-editing” culture. Synchronizing everything and everyone in conformity to its only value … money. Rendering everything a commodity.

It is the apotheosis of liberal democracy, the part where the monster does away with democracy, with the simulation of democracy, and proclaims itself “democracy.” It is global-capitalist Gleichschaltung.

That’s the monster I have been fighting.

Which makes me a terrorist. A conspiracy theorist. A Russian propagandist. A Covid denier. A right-wing extremist. An anti-vaxxer. An anti-Semite. A transphobic racist. An enemy of “democracy.” A Hamas supporter. A Donald Trump supporter. An AfD supporter. Whatever the official enemy happens to be today.

It makes me a criminal. A thought criminal. An art criminal.

Which I literally am. The German authorities are prosecuting me for disseminating art. For tweeting art. Pictures. Words. They banned one of my books. So maybe I’m marginally interfering with their ideological conditioning, with their programming, with their New Normal Gleichschaltung op.

If so, good, because, if I can quote another German, “art is not a mirror held up to reality, it is a hammer to shape reality with.”

And I’ll go a little further than Brecht. Every work of art we make shapes reality one way or another, whether we intend it to or not. It either feeds the monster or it fucks with the monster. The monster out there, and the monster in here, inside us, all of us … because it’s all the same monster.

Thank you, all of you who are fucking with the monster. That is all. Let’s keep it up.

CJ Hopkins is an award-winning American playwright, novelist and political satirist based in Berlin. His plays are published by Bloomsbury Publishing and Broadway Play Publishing, Inc. His dystopian novel, Zone 23, is published by Snoggsworthy, Swaine & Cormorant. Volumes I and II of his Consent Factory Essays are published by Consent Factory Publishing, a wholly-owned subsidiary of Amalgamated Content, Inc. He can be reached at cjhopkins.com or consentfactory.org.

Tyler Durden Thu, 05/02/2024 - 02:00

China Humiliated Blinken But Blinken Kept Begging

Zero Hedge -

China Humiliated Blinken But Blinken Kept Begging

Authored by Gordon Chang via The Gatestone Institute,

It is not clear whether a Chinese official was at the Beijing airport to bid farewell to Secretary of State Antony Blinken as he ended his three-day visit to China on Friday, but the send-off was in any event low-key and Chinese leader Xi Jinping slighted America's top diplomat at the end of his troubled stay.

Also, China, literally and figuratively, did not roll out the red carpet for his arrival in Shanghai on Wednesday. Only a low-level official was on hand to greet Blinken as he stepped off the plane.

"The Chinese government flouted international protocols at the airport on the secretary of state's arrival in Shanghai and departure from Beijing," Charles Burton of the Prague-based Sinopsis think tank told Gatestone.

"It was petty."

"This was more than a slight," Burton, a former Canadian diplomat who served in Beijing, said.

"Aside from a calculated insult to the dignity of the United States, the move indicates Xi Jinping is making clear that the accepted norms of diplomacy will not be respected by China anymore."

Blinken was in China to discuss the growing list of disagreements between Washington and Beijing. Not surprisingly, he did not accomplish anything there other than register America's complaints on matters such as Beijing's support for the Russian war effort in Ukraine and unfair treatment of U.S. companies. On every major issue, the U.S. and China take different sides, and the Chinese have clearly dug in. Blinken was reduced to begging.

As a result, America is resorting to the dialogue-is-progress narrative. "I think it's important to underscore the value—in fact, the necessity—of direct engagement, of sustained engagement, of speaking to each other, laying out our differences which are real, seeking to work through them, as also looking for ways to build cooperation where we can," Blinken said to Chen Jining, Communist Party secretary of Shanghai, ahead of his talks in the Chinese capital.

After the end of fruitless sessions in Beijing—Blinken met with, among others, President Xi Jinping and Foreign Minister Wang Yi—all the secretary of state could do is highlight new dialogue issues.

"I'm pleased to announce that earlier today, we agreed to hold the first U.S.-PRC talks on artificial intelligence to be held in the coming weeks," he said at a press availability on April 26, as he wrapped up his trip to China.

"We'll share our respective views on the risks and safety concerns around advanced AI and how best to manage them."

Blinken's comments repeated those of President Joe Biden after his November 15 meeting with Xi Jinping in Woodside, California. In substance, therefore, Blinken in Beijing continued talking about talking.

There is no question that AI is an important topic, especially when it comes to the control of nuclear weapons. Yet this does not mean the U.S. should seek an agreement with China on that topic.

"The latest shambolic display by the Biden administration comes in the form of Secretary of State Antony Blinken groveling before China's Ruler-for-Life Xi Jinping for a new set of protocols for governing the development of artificial intelligence between America and China, the two nations contributing the most to both the advancement of AI and its weaponization," Brandon Weichert, a national security analyst at The National Interest, told Gatestone.

"Although creating such protocols may sound like a good idea, it seems like a bad idea for Washington to unilaterally agree to limit its own activities."

"Unilaterally"? Burton and Weichert point out that China never honors agreements, so any deal with Beijing is akin to a unilateral promise.

"China is deeply committed to the weaponization of AI and would be counting its lucky communist star if the Americans basically deterred themselves with such a protocol," Weichert, also author of Biohacked: China's Race to Control Life, added.

He suggests the United States spend its time getting the world to restrict tech trade with China "rather than pleading with Xi Jinping for mercy."

On the AI front, the Biden administration to its credit has been restricting sales of chips and chip-making equipment and has been coercing cooperation from others, most notably the Netherlands, the home of equipment-maker ASML.

Nonetheless, Biden needs to do more: China has been able to buy chips on the black market. For instance, Reuters reported this month that ten Chinese entities were able, despite U.S. rules, to acquire Nvidia's artificial intelligence chips through resellers.

The risk now is that the Biden administration will trade away its restrictions for meaningless promises from China's Communists.

Biden is willing to sign agreements with China's regime because he believes it is merely a "competitor," refusing to label it an adversary and certainly not using the term that the Chinese Communist Party reserves for America: enemy. He and his predecessors have not wanted to acknowledge that the Party, as it openly proclaims, seeks the destruction of the United States.

Enemy? In May 2019, People's Daily, the Party's self-described "mouthpiece" and therefore the most authoritative publication in China, carried a landmark piece declaring a "people's war" on America.

This phrase has special meaning. "A people's war is a total war, and its strategy and tactics require the overall mobilization of political, economic, cultural, diplomatic, military, and other power resources, the integrated use of multiple forms of struggle and combat methods," declared a column carried in April 2023 by PLA Daily, an official news website of the People's Liberation Army.

Therefore, Biden's measures, like those of presidents before him, have been inadequate.

America still suffers from an inability to appreciate the hostility and maliciousness of the Communist Party. Blinken left China talking about how it was in America's interest for China to prosper. China's regime, however, fueled with American investment and trade, has been waging "unrestricted warfare" against the United States for decades. Beijing's unrestricted warfare has included the killing tens of thousands of Americans each year with fentanyl, the equivalent of one plane crash every day and more American deaths than in the Vietnam, Afghanistan, and Iraq wars combined.

Now, Xi thinks he has the upper hand. From the moment Blinken touched down in Shanghai to the moment he left, China's ruler went out of his way to humiliate the secretary of state. The secretary of state, however, exhibited inexhaustible patience for humiliation.

Unfortunately, acceptance of rough treatment has consequences, because the meekness leads the Chinese to think they can do what they want, making them even more arrogant and aggressive. Biden has yet to figure that out.

Xi met Blinken on Friday, but China's leader let the cameras record his disdain for his visitor. Seconds before the secretary of state walked half-way across the room to shake hands, Xi asked an aide, "When will he leave?"

"Not soon enough," Blinken should have replied.

The secretary of state should never have gone to China in the first place.

Tyler Durden Wed, 05/01/2024 - 23:45

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