Zero Hedge

Legal Scholar Raises Concerns Over DOJ Hiding FBI Informants At Jan. 6

Legal Scholar Raises Concerns Over DOJ Hiding FBI Informants At Jan. 6

Authored by Luis Cornelio via Headline USA,

Renowned legal scholar and Fox News contributor Jonathan Turley sounded the alarm about the DOJ’s failure to disclose to Jan. 6 defendants that FBI informants were present in the U.S. Capitol that day in 2021, as detailed in a DOJ Inspector General report.

In a Thursday interview with Fox News host Martha MacCallum, Turley said the report raised “more questions than answers” about the FBI’s rumored role in inciting violence at the Capitol.  

The law professor specifically such information would have been critical to defendants of the Jan. 6 protests who fell victim to the Biden DOJ’s aggressive prosecutions.

“In some ways, it raises more questions than answers. It does support Wray’s testimony that there were no undercover agents in the crowd,” Turley said, referring to FBI Director Christopher Wray.

“I think that for others, there is going to be a lot of concern as to what the sources were doing there,” he said, as reported first by the Daily Caller

DOJ Inspector General Michael E. Horowitz revealed that at least 26 FBI confidential human sources (CHSs) were present among the crowd protesting the contentious 2020 presidential election results. 

“Our review determined that none of these FBI CHSs was authorized by the FBI to enter the Capitol or a restricted area or to otherwise break the law on January 6, nor was any CHS directed by the FBI to encourage others to commit illegal acts on January 6,” Horowitz found. 

Of the 26 agents, only three were summoned to the U.S. Capitol that day, Turley noted, before highlighting that FBI informants had previously been accused of inciting crimes. 

“We’ve had cases in the past where the defense has argued that sources and agents have been extremely active in pushing people towards criminal conduct,” Turley said. “We saw those allegations raised in the Michigan case involving the governor there.” 

The FBI’s potential role in inciting violence was highlighted in the “kidnapping” plot of Michigan Gov. Gretchen Whitmer. Two men indicted in the alleged plot were acquitted by a jury, while two others faced hung juries. The latter two were convicted in a retrial. 

Turley argued that Jan. 6 defense attorneys would have used the FBI informants’ presence during the protests if they had known about it. 

“I think that some defense attorneys may raise the question as [to] why they weren’t told, if they weren’t told about the confidential sources that might have been involved tangentially with their own cases, because usually defense counsel says we want to know what asset, what personnel the government had there. So there is going to be questions of that kind, that arise,” Turley said.

Tyler Durden Fri, 12/13/2024 - 13:45

GM's Cruise Pivot Opens Door To Buybacks, Focus On Level 3+ And Level 4 Autonomy, Deutsche Bank Says

GM's Cruise Pivot Opens Door To Buybacks, Focus On Level 3+ And Level 4 Autonomy, Deutsche Bank Says

In a new note out from Deutsche Bank, analyst Edison Yu argues that the pivot from Cruise opens the door for more buybacks and a renewed focus on end to end AI in its vehicles. 

Yu highlighted GM's announcement to integrate Cruise with its core operations, projecting annual cost savings exceeding $1 billion, on top of its prior guidance for steady EBIT in 2025.

While it remains unclear if the 2025 outlook has shifted, Yu believes the move will be welcomed by investors as GM can reallocate resources to its aggressive share buyback plan, aiming to reduce share count below 1 billion by early 2025, and prioritize investments in Level 3+ and Level 4 autonomy, which have quicker monetization potential.

Yu also noted GM's pivot in Cruise’s technology strategy, with the company now leveraging end-to-end AI models rather than its earlier rules-based approach, signaling a significant evolution in its autonomous vehicle efforts.

Yu commented on GM's decision to acquire the remaining 10% of Cruise and integrate its development under GM's operations.

The move shifts focus from costly robotaxi commercialization to advanced driver-assistance systems (ADAS), like Level 3 autonomy for consumer vehicles. GM cited the high cost of scaling robotaxis, potentially in the tens of billions, as a key reason for the pivot, deeming it a poor risk/reward investment.

GM aims to complete the restructuring by early 2025, leading to annual savings of over $1 billion, reducing Cruise's current $2 billion spend.

Yu noted that while GM's 2025 guidance for flat EBIT hinges on reducing EV losses by $2–$4 billion, the additional savings provide a significant cushion for potential shortfalls. From a valuation perspective, Cruise’s optionality was already discounted by most investors. The lower cash burn enables GM to enhance its aggressive share buyback strategy, with plans to complete its $6 billion authorization by early 2025, reducing its share count below 1 billion.

The note can be found in the usual place for premium subscribers

Tyler Durden Fri, 12/13/2024 - 11:25

Ex-Stripper, Convicted Killer Crystal Mangum Admits To Lying About Being Raped By Duke Lacrosse Players

Ex-Stripper, Convicted Killer Crystal Mangum Admits To Lying About Being Raped By Duke Lacrosse Players

Authored by Zachary Stieber via The Epoch Times,

Crystal Mangum, a former exotic dancer who in 2006 accused three Duke University lacrosse players of raping her, acknowledged for the first time in a new interview that she made up the accusations.

Mangum had said in 2006 that the players - David Evans, Collin Finnerty, and Reade Seligmann - raped her in a house near Duke’s campus during a team party at which she performed.

“They took me into my home ... and they trusted me, that I wouldn’t betray their trust. And I testified falsely against them by saying that they raped me when they didn’t, and that was wrong,” Mangum said on a podcast episode released on Dec. 11.

The players were arrested and charged with rape and other crimes.

The case garnered national attention and the tension was fueled when former Durham County district attorney Mike Nifong said in a March 2006 interview with CBS News that “there’s no doubt a sexual assault took place” and that the assault was “racially motivated.”

The circumstances of the rape indicated a deep racial motivation for some of the things that were done.

It makes a crime that is by its nature one of the most offensive and invasive even more so,” said Nifong, who served as the lead prosecutor in the case.

Nifong initially said that DNA would prove the players’ innocence, but he reversed his statement when the tests returned negative.

Then-North Carolina Attorney General Roy Cooper dropped the charges after taking over the case and concluding the students were innocent.

Nifong was disbarred for withholding evidence from defense lawyers.

Former Duke University President Richard Brodhead, who canceled the rest of the lacrosse season and suspended the players, said later that officials presumed the students were innocent and trusted the legal system to work but that they failed to contact the players and their families or make clear that the allegations may not have been true.

“We did not get it right, causing the families to feel abandoned when they most needed support,” he said at the time. “This was a mistake. I take responsibility for it, and I apologize.”

Evans, Finnerty, and Seligmann filed a lawsuit against both Brodhead and the university, ultimately reaching an undisclosed settlement.

Mangum, 42, was never charged in relation to the accusations she leveled against the players. She has been serving a prison sentence for second-degree murder after killing her boyfriend.

Mangum, who said in a 2008 book that she was assaulted, said in the new interview that she “made up a story that wasn’t true” because she “wanted validation from people and not from God.”

Mangum said she reads the Bible every day, relies on her faith, and is hopeful the players can forgive her.

“I hope that they can forgive me ... and I hope that they can heal and trust God and know that God loves them and that God is loving them through me, letting them know that they’re valuable,” she said, adding that the players did not deserve to be falsely accused.

Katerena DePasquale, who hosts the podcast that released the interview, said in a statement that her goal was to see a person “navigating an imperfect system.”

She said that Mangum “shared something significant and vulnerable, despite the risks involved,” and called her courageous.

Mangum had never publicly stated that she fabricated the rape allegation before Thursday’s revelation.

She can no longer be prosecuted for lying under oath since the statute of limitations on perjury charges under North Carolina law is two years.

Tyler Durden Fri, 12/13/2024 - 11:05

"EURUSD Parity Could Be Reached In The Next 6 Months"

"EURUSD Parity Could Be Reached In The Next 6 Months"

By Philip Marey, senior US strategist at Rabobank

EUR/USD has been trending downward this week, in line with our expectation that parity could be reached in the next 6 months, as the ECB continues to cut and the Fed’s room to cut is likely to be limited by the new policies of the Trump administration that may fuel inflation. Yesterday, the SNB and the ECB cut their policy rates.

As flagged by our Jane Foley, the SNB surprised the consensus by making a 50 bps cut, instead of 25. The SNB said that underlying inflationary pressure has decreased again this quarter. The SNB’s easing of monetary policy yesterday takes this development into account. The SNB will continue to monitor the situation closely, and will adjust its monetary policy if necessary to ensure inflation remains within the range consistent with price stability over the medium term. Although the SNB only meets 4 times a year, Schlegel said that the SNB can decide on policy between quarterly meetings. The SNB has also reiterated that it is willing to be active in the FX market as necessary. Looking further ahead, Schlegel said that the SNB doesn’t like negative rates but they do work.

The ECB made a more modest cut of 25 bps, in line with expectations. The ECB cut the deposit facility rate to 3.00% and removed the remaining hawkish part from its policy statement. All PEPP reinvestments will be discontinued as of the end of the year. The growth forecasts were downgraded somewhat and the economic projections are fully in line with price stability. However, risks remain, and the ECB does not consider its mission accomplished. We expect little opposition to the next two rate cuts. But when the policy rate reaches 2.5%, we would expect to see growing discord in the Governing Council. For more details, we refer to Bas van Geffen’s ECB post-meeting comment.

Yesterday, the US PPI for November was higher than expected. The PPI final demand rose to 3.0% year-on-year (beating the consensus expectation of 2.6%) and there was an upward revision to the October rate from 2.4% to 2.6%. At the same time, the initial jobless claims unexpectedly rose to 242K in the first week of December, from 225K in the final week of November (upward revision from 224K). The 2y US treasury yield seemed to react more to the jobless claims than the PPI and fell after the simultaneous release of the data, before rebounding later in the day.

Weekly wrap: divergent central banks

On Wednesday, two central banks in the Americas headed in different directions. The Bank of Canada cut the policy rate 50bp, bringing the policy rate down from 3.75% to 3.25%. This decision was around 80% priced in by the market, and we were in the majority of analysts who correctly forecasted this decision. The decision was followed by a press conference with Governor Macklem and Senior Deputy Governor Rogers. The Bank did mention the unemployment rate, quoting that in November, “employment continued to grow more slowly than the labour force,” but chose to direct its justification for the cut towards slowing GDP growth. We expect three cuts from the Bank of Canada throughout 2025, starting with a 25bp cut at the January 29th meeting, bringing the overnight rate target down to terminal 2.50% by the middle of next year. We maintain the view that the risks to our outlook remain skewed towards more and deeper cuts. In terms of USD/CAD, we expect interest rate differentials to continue boosting the pair and are still forecasting a move to 1.46 on a nine-month view. For more details, see the Bank of Canada post-meeting comment by Christian Lawrence and Molly Schwartz.

In contrast to the Bank of Canada, and the SNB, and the ECB, the Copom of the Banco Central do Brasil unanimously decided to hike the Selic rate to 12.25%, with an increase of 100 bp, more than we and the market consensus had expected (75 bp). The Copom's inflation projection over the relevant monetary policy horizon (26Q2) continued to rise compared to the previous meeting (to 4.0% y/y, which is 30 bp more than the previous, November, meeting, or 100 bp above the target), even after incorporating market expectations that the Selic rate would be raised to 13.75% by the May 2025 meeting and would remain practically unchanged throughout 25H2. The Copom continues to see an upwards asymmetry in the balance of risks to inflation. This time, the Copom mentioned that the risk premium, inflation expectations, and the exchange rate have been affected by the perception of economic agents following a recent fiscal announcement. Thus, it concluded that, in the face of "additional unanchoring of inflation expectations, rising inflation projections, stronger-than-expected activity dynamism, and greater-than-thought widening of the output gap," monetary policy needs to be even more contractionary. More surprisingly, the Copom has already announced at least two more increases of the same size in the upcoming meetings. Given the more hawkish stance, it seems to us that the Copom will hike the Selic to 15.00% in 2025 (instead of 13.00% previously). Thus, in addition to two 100-bp hikes, we now expect a 50-bp hike at the May-2025 meeting and a remaining 25-bp hike at the June-2025 meeting. Rate cuts should come in 2026 if inflation expectations resume convergence back towards the 3.0% target. The release of the minutes of this meeting next Tuesday and the 24Q4 Inflation Report next Thursday will reveal more details about the reaction function and the Central Bank's revealed preferences in light of their analysis on inflation and the state of the economy. For more details, see the BCB post-meeting comment by Mauricio Une and Renan Alves.

Earlier, on Tuesday, the Reserve Bank of Australia made a dovish pivot. The RBA left rates unchanged as expected. However, its guidance was interpreted not only as taking the risk of another rate hike off the table, but also opening the door to a possible rate cut in February.

Tyler Durden Fri, 12/13/2024 - 10:25

Five Takeaways From The Historic Russian-Indian Oil Deal

Five Takeaways From The Historic Russian-Indian Oil Deal

Authored by Andrew Korybko via substack,

Russia is recalibrating its balancing act within the RIC triangle.

Reuters reported that Russia agreed to supply India with nearly half a million barrels of discounted oil a day for 10 years in a deal that’s worth $13 billion a year at today’s prices and amounts to 0.5% of global supply.

It follows Defense Minister Singh’s visit to Moscow where he praised their friendship as "higher than the highest mountain and deeper than the deepest ocean” and precedes Putin’s trip to India next year.

This is a historic deal with many implications, the top five most significant of which are as follows:

1. Reliable Revenue & Accelerated Growth

Russia will receive reliable budgetary revenue while India’s growth will accelerate from the large-scale import of discounted oil, thus enabling the first to better manage sanctions pressure while the second will approach its goal of becoming the world’s third-largest economy at a faster pace. This decade-long arrangement also creates a solid basis for diversifying from their strategic partnership’s hitherto military-centricity, and it’s possible that some of Russia’s forthcoming profits could be reinvested inside of India.

2. Russia’s South Asian Energy Pivot

The abovementioned trend is part of Russia’s South Asia energy pivot, which also includes Afghan and Pakistani dimensions that were elaborated on here in terms of the larger context. The Kremlin plans to preemptively avert potentially disproportionate dependence on China by relying on the South Asian market, with India at its core, as a counterbalance. RT importantly informed their audience that “The new deal reportedly accounts for roughly a half of Rosneft’s seaborne oil exports from Russian ports.”

3. OPEC+ Probably Won’t Mind All That Much

Oilprice.com wrote that the deal “could cause friction among OPEC+ members as Russia encroaches on Gulf producers’ market share in India”, but while Russia is now India’s top oil supplier at around one-third of its needs, that still leaves the other two-thirds for Saudi Arabia and the UAE to fill. Moreover, Russia isn’t their competitor in the ASEAN, European, or Japanese markets, those two Gulf Kingdoms’ leaders have excellent personal ties with Putin, and their bilateral relations with Russia are close too.

4. Trump Isn’t Expected To Sanction India

It was assessed last month that “Trump Can Repair The Damage That Biden Dealt To Indo-US Ties” due to his incoming Indophilic team, hence why he isn’t expected to sanction India for this historic deal. His grand strategic goal is to “un-unite” Russia and China in order to more effectively contain the latter, to which end it serves US interests for Russia to rely more on India as a counterweight to China. If he imposes any oil-related sanctions, it might be on China to reduce Russia’s supply to it, not on India.

5. China’s Basement-Bargain Price Demands Backfired

The basement-bargain prices that China reportedly began to demand after February 2022 in exchange for clinching a deal on the long-negotiated Power of Siberia 2 gas pipeline shocked Russian policymakers since they conformed to hitherto unbelievable Western reports about that country’s exploitative nature. To be sure, relations are at an historic high and bilateral trade has never been better, but this bitter experience led to the Kremlin preferring India over China as Russia’s most strategic energy partner.

The historic Russian-Indian oil deal is a new milestone in these two’s decades-long strategic partnership. It proves that their relations are enduring and expanding in spite of external pressures.

Just as importantly, it also disproves speculation that Russia is leaning towards China at India’s expense in the RIC triangle, which forms the core of BRICS and the SCO.

To the contrary, Russia is now very clearly leaning closer towards India, though this isn’t at China’s expense nor will it ever be.

Tyler Durden Fri, 12/13/2024 - 09:45

Elon Musk: "Starbase Is Going To Be A City" In Texas

Elon Musk: "Starbase Is Going To Be A City" In Texas

Elon Musk's SpaceX has sent a letter to local officials in southern Texas outlining a new mission: to transform the remote area where the company launches rockets into an incorporated town named "Starbase, Texas."

SpaceX launches rockets on the southern tip of Texas at Boca Chica Beach, near the Mexican border.

Incorporating the remote area would "streamline the processes required to build the amenities necessary to make the area a world-class place to live—for the hundreds already calling it home, as well as for prospective workers eager to help build humanity's future in space," the company wrote in a letter to Cameron County Judge Eddie Treviño Jr., the county's top elected official. 

"As you know, through agreements with the County, SpaceX currently performs several civil functions around Starbase due to its remote location, including management of the roads, utilities, and the provision of schooling and medical care for the residents. Incorporation would move the management of some of these functions to a more appropriate public body," the letter said.

AP News quoted Judge Treviño, who said there were incorporation talks in 2021. However, this was the first time a petition was officially filed. 

"Our legal and elections administration will review the petition, see whether or not it complied with all of the statutory requirements and then we'll go from there," the judge said. 

Earlier this year, the judge issued a local impact study finding that 3,400 full-time SpaceX employees and contractors work at the rocket launch site.

SpaceX's rapid expansion comes as Gwynne Shotwell, president of SpaceX, told investors last month that Starship launches over the next four years could exceed 400

CNBC confirmed on Wednesday that the latest valuation for SpaceX hit $350 billion based on a secondary share sale. 

As previously noted, SpaceX launched 362 metric tons of upmass to space in the third quarter. In other words, Musk's company launched 86% of the upmass in the world, beating all rocket programs, including ones funded by nation-states.

Starship's fifth test flight in early October was groundbreaking...

SpaceX is why America is years ahead of the rest of the world in the space race.

Tyler Durden Fri, 12/13/2024 - 09:25

Mounting Boeing Delays Suggest Trump Won't Fly In New Air Force One

Mounting Boeing Delays Suggest Trump Won't Fly In New Air Force One

Aerospace giant Boeing warned earlier this year that supply chain snarls, persistent inflation, and workforce challenges have impacted the construction timeline of two new Air Force One presidential aircraft. 

A new report from the Wall Street Journal suggests that continued delays indicate President-elect Donald Trump will not get to fly in the new Boeing 747s during his second term, with the latest projections targeting 2029 or later.

Trump is frustrated with the delays. Here's more from WSJ: 

Frustrated with the delays, Trump raised the project with Boeing CEO Kelly Ortberg when the two men spoke by phone in November. As he prepares to return to the White House, Trump has repeatedly asked advisers about the status of Boeing's work. Boeing used to be a great American company, he has told aides, according to people briefed on the discussions. What happened to them? Trump has asked.

In 2018, during President-elect Trump's first term, Boeing received a $3.9 billion contract to build two new 747-8 aircraft for use as Air Force One. The aircraft were supposed to be delivered by the end of this year.

Ted Colbert, head of Boeing Defense, Space & Security, spoke with Fox Bussiness in July, revealing that supply chain, inflation, workforce, and other challenges in building the airplanes pushed out delivery timelines.

"Our team is fighting through a very, very challenging program – two very complex airplanes," Colbert said at the time, adding, "We've done a ton of investment in our workforce and training, efficiency, work on the factory floor."

In 2023, the Biden administration decided to reverse Trump's decision to switch to a red, white, and blue scheme, from the current white with two shades of blue, a design that dates back to the Kennedy administration. 

"The delay is startling given that Boeing isn't building the planes from scratch," WSJ noted.

Tyler Durden Fri, 12/13/2024 - 08:50

Futures Jump Led By Tech After Broadcom Soars To All Time High

Futures Jump Led By Tech After Broadcom Soars To All Time High

US equity futures pointed to a strong end to the week, as a premarket surge in Broadcom powered gains across the entire chip and tech complex, even as European bourses dipped and Asian markets took it on the chin after the latest Chinese stimulus disappointment. As of 8:00am S&P500 futs gained 0.4%, and Nasdaq 100 futures rose 0.7%, with shares in Broadcom surging 15% after it predicted a 65% increase in sales of AI chips in the fiscal first qtr; if gains holds, the stock will hit a record high, inching closer to a $1 trillion market cap. Peers Marvell, Micron, Nvidia and Advanced Micro Devices also rose. US 10Y yields gained 3bps rising to 4.35%, highest since Nov. 25; the dollar reversed earlier gains with the euro bouncing after Macron named centrist Bayou as the new French PM. Crude oil futures rose to a weekly high. On tap today we have US Import/Export prices (8:30am ET), Eurozone + UK Industrial production, Japan Industrial production

In premarket trading, Broadcom surged 18% after the chip supplier for Apple Inc. and other big tech companies predicted a boom in demand for its artificial intelligence chips. Costco shares also rose in premarket trading after the retailer reported first-quarter earnings per share that came in ahead of consensus estimates. TD Cowen noted that newness, quality and value are resonating strongly with US consumers. Here are some other notable premarket movers:

  • EVgo (EVGO) rises 11% after the company closed on a $1.25 billion Energy Department loan to help expand its EV charging network. JPMorgan says “EVgo delivered an early holiday gift to investors.”
  • RH (RH) jumps 18% after the furniture retailer raised its revenue forecast for 2025 and swung to a profit in the third quarter.
  • TaskUS (TASK) gains 8% after Morgan Stanley turned bullish on the IT services firm, saying the company is a beneficiary from AI with exposure to key customers Meta and OpenAI, which will drive growth in 2025 and 2026.

Stock markets are likely to extend their gains into next week, when the Fed is priced to deliver another quarter-point reduction. The S&P 500 has rallied 27% this year, and strategists polled by Bloomberg predict it will outpace European peers again in 2025. As of today, the S&P is on pace for the best full-year return this century.

"You have a US economy which is doing well and an incoming administration that is very pro-corporate — all that is in the price, but it doesn’t mean the rally can’t extend,” said Timothy Graf, head of EMEA macro strategy at State Street Global Markets.

Unlike the US where every day is a meltup, Europe’s Stoxx 600 index traded down 0.3% near session lows amid continued disappointment over the lack of concrete stimulus measures from China. Miners provided a drag, tracking iron ore futures lower after China’s Central Economic Work Conference seemed to underwhelm investors. Insurer Munich Re was a notable gainer after it forecast a net income boost next year.  Here are the biggest movers Friday:

  • Munich Re shares rise as much as 5.5% after the insurance giant outlined a net profit target for 2025 that was welcomed by analysts. Jefferies said it had anticipated a more cautious outlook, while Citi noted the target is being well-received considering its history of over-delivering
  • Soitec shares shares gain as much as 7.7%. Bernstein analysts say visibility is finally improving at the semiconductor wafer maker, after a string of warnings
  • St James’s Place shares rise as much as 4.6% after being upgraded by Deutsche Bank, which sees a more positive investment case for the UK wealth manager after digging deeper into the potential impact of an ongoing advice issue and new charging structure
  • CD Projekt falls as much as 5.8% following the release of a 6-minute trailer of the new The Witcher IV game. The video is seen by analysts as a signal that the Polish studio aims to premiere its latest version of the medieval monster slayer game in 2026
  • Outokumpu falls as much as 7.2%, the most since April, after the Finnish stainless steel manufacturer said its 4Q adjusted Ebitda will be close to breakeven or turn negative amid recent adverse developments in business in Europe
  • TeamViewer shares fall as much as 6.7% after Berenberg downgrades the stock to hold from buy, seeing a risk that the software firm may have overpaid for its acquisition of 1E
  • Impax shares fall as much as 24%, the most in over 21 years, after UK wealth manager St. James’s Place terminated the asset manager’s mandate to manage the Sustainable & Responsible Equity Fund
  • Tullow Oil shares drops as much as 8.9% in London, paring initial gains after company confirmed preliminary talks with Kosmos Energy about an all-share offer by Kosmos for Tullow late Thursday

Earlier in the session, Asian shares fell led by losses in China after authorities again left investors waiting on the specifics of the fiscal stimulus even as their key policy meeting produced a vow to boost consumption. The MSCI Asia Pacific Index fell as much as 1.1%, the most in a month. Tencent, Meituan and Sony were among the biggest drags. Japanese gauges fell, while South Korean shares gained for a fourth day. Chinese stocks declined as traders parsed comments from the annual Central Economic Work Conference. Authorities vowed to raise China’s fiscal deficit target next year, and made “lifting consumption vigorously” and stimulating overall domestic demand their top priority.  Retail sales data due next week will help shed light on the state of China’s economy. The week ahead is also packed with monetary policy decisions from the Federal Reserve as well as central banks in Japan, Indonesia, Thailand, Philippines and Taiwan.

“The market may have some hope that the CEWC would give more details on consumption stimulus and property inventory clearance packages, but it turned out a bit disappointing,” said Jason Chan, senior investment strategist at Bank of East Asia. “Investors may need to wait for more fiscal policy rollout in the first quarter, also the ‘Two Sessions’ held in March.”

A gauge of world stocks is headed for the worst week in nearly a month. “The newsflow has been underwhelming,” Beata Manthey, head of European equity strategy at Citigroup Inc., said of announcements from China. “The markets want numbers. We didn’t get the numbers.” However, Chinese 10-year government bond yields slid below 1.8% for the first time in history, as authorities vowed to cut policy rates and banks’ reserve ratios.

In FX, the dollar was steady against a basket of currencies, reversing earlier gains as the euro rebounded, but was still on track for a second straight week of gains. The pound weakened after Britain’s economy unexpectedly contracted for a second straight month in October. The euro strengthened after the ECB sounded less dovish on rates than some expected after its policy announcement Thursday and forcing traders to pared policy-easing bets for next year; it moved even higher after French PM Macron named centrist Bayrou as the new French PM. The yen is the weakest of the G-10 currencies, falling 0.5% against the greenback as traders bet that the Bank of Japan will keep interest rates unchanged next week, just as we warned.

In rates, treasuries are again cheaper across the curve, tracking bigger losses in European rates. The US yield curve steepening trend stalls following five straight increases in the 5s30s spread. US yields are 2bp-3bp cheaper across maturities with 10-year around 4.35%, highest since Nov. 25 outperforming German 10-year by ~2bp; major curve spreads are within 1bp of Thursday’s close. Bunds underperform their European peers, with German 10-year yields rising 3 bps to 2.23%. Gilts have been supported by soft GDP data from the UK while the surprise monthly economic contraction in October also weighs on the pound. IG issuance calendar empty so far. Gilts outperform after soft UK GDP data, which also weighed on the pound.

Graf of State Street expects more gains for the dollar, noting that the Fed’s easing cycle could prove shallow relative to Europe, where economic growth is weaker. Swap markets aren’t pricing a cut from the Bank of England at next week’s meeting, despite Friday’s weak data.

In commodities, oil prices advanced again, with WTI rising 0.8% to $70.60; Brent crude up 3.5% this week on the prospect for tighter US sanctions against Iran and Russia. Spot gold falls $12 to $2,668/oz.

US economic data calendar includes November import and export price indexes at 8:30am.

Market Snapshot

  • S&P 500 futures up 0.2% to 6,075.75
  • STOXX Europe 600 down 0.2% to 518.27
  • MXAP down 0.9% to 185.75
  • MXAPJ down 0.6% to 585.55
  • Nikkei down 1.0% to 39,470.44
  • Topix down 1.0% to 2,746.56
  • Hang Seng Index down 2.1% to 19,971.24
  • Shanghai Composite down 2.0% to 3,391.88
  • Sensex up 0.9% to 82,021.18
  • Australia S&P/ASX 200 down 0.4% to 8,295.96
  • Kospi up 0.5% to 2,494.46
  • German 10Y yield little changed at 2.22%
  • Euro little changed at $1.0472
  • Brent Futures up 0.4% to $73.69/bbl
  • Gold spot down 0.3% to $2,672.66
  • US Dollar Index up 0.13% to 107.09

Top Overnight News

  • A top trade adviser to Donald Trump said that the new administration would not look "fondly" on any attempt by China to manipulate its currency, responding to a Reuters report that authorities there were considering allowing the yuan to weaken next year. Peter Navarro, Trump's incoming senior counselor for trade and manufacturing, said the White House would not interfere with the Treasury Department's biannual review looking in to whether foreign trade partners are manipulating their currencies. RTRS
  • Trump considers options for preventing Iran from expanding its nuclear program, including the potential for airstrikes (Trump’s team feels Iran is uniquely weakened following events in Lebanon and Syria). WSJ  
  • Trump explores merging bank regulators (FDIC, OCC, and Fed) in an attempt to eliminate duplication and promote efficiency, but any change would require Congressional approval and is likely to be controversial. WSJ
  • Elon Musk renewed his feud with the SEC, revealing that the agency is investigating Neuralink and may take action over his investments in Twitter. He’s also seeking to turn SpaceX’s Starbase site in Texas into a new city and move the company’s headquarters there. BBG
  • Broadcom reported EPS/EBITDA upside while overall sales fell slightly short (semiconductor revenue was above expectations) and the guide was fine (the sales outlook was inline while the EBITDA margin forecast is ~250bp higher). Shares spiked 15% during the earnings call as mgmt. delivered a bullish message on AI demand, VMWare accretion, and its relationship w/Apple (the company downplayed the Bloomberg report about it being at risk of displacement in the iPhone). BBG
  • Insurance stocks are rallying in Europe following bullish 2025 guidance from both Munich Re and Swiss Re. RTRS
  • UK economic data in Oct falls short of expectations, including GDP, industrial production, and manufacturing production (GDP contracted for the second consecutive month). BBG
  • Germany’s Bundesbank slashed its growth forecast for the country, warning of another year of economic stagnation and cautioning that a trade war with the US would trigger recession. FT   
  • Trafigura reported a 62% drop in profit as it took $1.1 billion in losses related to alleged employee misconduct in its Mongolian oil business. The company is restating several years of prior accounts and took additional hits on its zinc smelting and retail fuel businesses. BBG
  • Microsoft (MSFT) filed for debt shelf; size undisclosed, via SEC filing. Separately, Microsoft introduces Phi-4, the company's newest small language model specialising in complex reasoning
  • Apple (AAPL) will begin assembling AirPods in India by early 2025, partnering with Foxconn (HNHPF): BBG

A more detailed look at global markets courtesy of Newsquawk

APAC stocks traded lower across the board following a similar session on Wall Street after the hot US PPI, whilst sentiment in Asia-Pacific was somewhat hampered as participants digested the disappointing release from the Chinese Economic Work Conference. ASX 200 was pressured by the metals sectors, namely gold miners, after the recent slide in the yellow metal as the Buck  ramped up. Nikkei 225 pulled back further under 40,000, failed to benefit from a softer JPY and largely overlooked higher-than-expected optimism among large Japanese manufacturers from the BoJ's Tankan Survey. Hang Seng and Shanghai Comp were both softer as traders digested the release from the Chinese Economic Work  Conference, which overall seems like a disappointment as it offered little in terms of details whilst reaffirming the recent policy shift.

Top Asian News

  • PBoC official Zou Lan says PBoC will deepen FX market reform next year, according to state TV. Will keep the Yuan 'basically' stable. Will respond vigorously to external shocks. Will increase treasury bond buying and selling operations. Will provide sound liquidity environment for government bond issuance.
  • Trump Trade Advisor Navarro warned against currency manipulation after Reuters sources suggested China is mulling a weaker CNY.
  • South Korean Finance Ministry said they will deploy more market stabilising measures if volatility heightens excessively, according to Reuters.
  • BoJ Dec Tankan corporate price expectations survey: Japanese firms expect consumer prices to rise 2.4% a year from now (prev. +2.4%). 3-year expectation +2.3% (prev. +2.3%); 5-year expectation +2.2% (prev. +2.2%).
  • Japan's small firms are spending more of their profits on wages than their larger counterparts and may struggle to keep raising pay, casting doubt on whether wage gains are broad enough for BoJ to keep hiking rates, according to Reuters analysis. Policymakers are reportedly looking at whether small firms (which employ 70% of Japan's workforce) can continue meeting pay demands.
  • REUTERS POLL: BoJ to hold key interest rate at 0.25% in December, according to 58% of economists polled (vs 44% in Nov poll)
  • Chinese President Xi is not planning to attend Trump's inauguration but might send a senior official to represent him, according to WSJ sources.

European bourses began the European session on a modestly mixed footing, but soon after the cash open then lifted to session highs to display a positive picture in Europe. European sectors are mixed vs initially opening with a slight negative bias. Autos is towards the top of the pile, continuing to build on the gains seen in the prior session. Insurance follows closely behind, buoyed by gains in Swiss Re and Munich Re. Healthcare lags alongside losses in Basic Resources. US equity futures are entirely in the green, with clear outperformance in the tech-heavy NQ after Broadcom (+14%) shoots higher following a strong earnings report. Broadcom (AVGO) reported Q4 adj. EPS of 1.42 (exp. 1.39), and Q4 adj. net revenue of USD 14.05bln (exp. 14.1bln). Raised quarterly dividend +11% to 0.59/shr. Q4 semiconductor solutions revenue USD 8.23bln (exp. 8.05bln). Exec sees Q1 AI revenue growth of 65%, and expects momentum in AI connectivity to be as strong. +15% pre-market

Top European News

  • ECB's Villeroy says more rate cuts are to come. Notes that French bond spreads have moved away from Germany and closer to Italy.
  • ECB's Kazaks says the direction of interest rates is clearly down, the neutral rate is closer to 2% than 3%, significant reduction in rates is still necessary.
  • Goldman Sachs (GS) cuts UK's 2024 GDP growth forecast to 1.0% from 1.2%.
  • ECB's Holzman says yesterday's decision was "good". If things go as expected, sees no danger for prices in cutting rates next year. Neutral rate is around 2%, rates could fall to this level.
  • ECB's Vasle says decisions will be taken meeting-by-meeting in a data-dependent fashion.
  • BoE Inflation Attitudes Survey (Nov.): Median expectations of the rate of inflation over the coming year were 3%, up from 2.7% in August 2024. Asked about expected inflation in the twelve months after that, respondents gave a median answer of 2.8%, up from 2.6% in August 2024. Asked about expectations of inflation in the longer term, say in five years’ time, respondents gave a median answer of 3.4%, up from 3.2% in August 2024.
  • VCI says producer prices down 2.5% Y/Y, total sales - 2% Y/Y to EUR 221bln, industry sales will slacken due to higher producer pries and lo order backlogs in 2025.
  • Bundesbank lowers its German growth outlook across the entire forecast horizon. Economy to stagnate in the "winter half-year" and then make a slow recovery across 2025. US President-elect Trump's proposed tariffs could lower growth by 1.3-1.4% through 2027. ECB's Nagel says protectionism is the biggest area of uncertainty. Growth Forecasts: 2024: -0.2%; 2025: 0.2%; 2026: 0.8%.

FX

  • DXY is essentially flat after spending most of the European morning in positive territory. DXY currently sits towards the bottom end of a 106.93-107.18 range. Today's docket is light, with just US Import/Export Prices on deck.
  • EUR is slightly firmer vs. the USD as the dust continues to settle on yesterday's 25bps ECB rate cut. Sources followed the announcement, noting that the GC is prepared for a quarter-point rate cut at the next two meetings inflation stabilizes at the 2% target and economic growth remains sluggish. ECB speak this morning has continued to stress the inevitability of further easing in the coming months.
  • JPY has continued to lose out to the USD throughout the European morning. JPY saw some fleeting support overnight in response to the higher-than-expected optimism among large Japanese manufacturers from the BoJ's Tankan Survey. Recent JPY weakness has coincided with a pick-up in risk sentiment (CHF has also moved lower in tandem).
  • GBP is on the backfoot and near the bottom of the G10 leaderboard following soft M/M GDP data for October which printed at -0.1% vs. Exp. +0.1%. That being said, PM has cut its Q4 Q/Q forecast to 0.1% from 0.3% (MPC expects 0.3%). Accordingly, Cable slipped below its 21DMA at 1.2670 and fell to a session low at 1.2620.
  • Antipodeans are contained vs. the USD in quiet trade with upside for AUD capped by the soft performance for Chinese markets overnight as traders digested the release from the Chinese Economic Work Conference, which overall seems like a disappointment as it offered little in terms of details whilst reaffirming the recent policy shift.
  • PBoC set USD/CNY mid-point at 7.1876 vs exp. 7.2745 (prev. 7.1854)
  • RBI likely sold USD to support the INR, according to traders cited by Reuters.

Fixed Income

  • USTs are steady overnight with specifics light and the docket ahead also limited as the countdown to the FOMC begins. Action in the European morning limited to a 110-09+ to 110-14 range. Yields little changed overall with no overt flattening/steepening bias thus far.
  • Bunds began the morning in the red with EGBs trading in proximity to Thursday’s lows, after the ECB was judged to not be as dovish as some had hoped for. ECB speak this morning includes Muller saying the period of strong inflation is behind, Kazaks saying the direction is clearly down and the influential Villeroy remarking that there are more cuts to come. Since, the downside has extended slightly with Bunds at lows of 134.80 having faded below 135.00.
  • OATs are down in tandem with the broader complex; once again, we are awaiting French President Macron’s announcement as to who the next PM will be.
  • Initial leads for Gilts were bearish given the above but offset by a particularly soft set of UK growth data for October, with GDP missing across the board Services showing no growth while both Production and Construction fell in the period. Gilts in the red, though not as soft as EGBs are. Opened at a 94.89 session high before fading to a 94.66 trough.

Commodities

  • WTI and Brent are on a modestly firmer footing after trading mostly rangebound overnight, amid the lack of pertinent newsflow for the complex. On geopolitics, Ukraine said Russia had attacked several Ukrainian energy facilities. As for the Middle East, the WSJ reported that "President-elect Trump is weighing options for stopping Iran from being able to build a nuclear weapon, including the possibility of preventive airstrikes". Brent'Feb 2025 currently sits around the USD 74/bbl mark.
  • Gold is softer, potentially dented by the grind higher in risk sentiment seen in the European morning and continued DXY advances above 107.00.
  • 3M LME Copper was flat for most the session but has just managed to recoup the USD 9.1k mark but remains markedly shy of Thursday’s USD 9.2k opening level and that session’s higher thereafter at USD 9.27k before the WTD USD 9.3k peak.
  • Goldman Sachs said their base case is that Brent averages USD 76/bbl in 2025 given near offset between a modest 400k BPD surplus and a normalisation in currently low valuation.
  • Moldovan Parliament declares state of emergency from Dec 16th amid the possible end of flow of Russian gas from Jan 1st, according to Reuters.
  • Russian attacks on Ukrainian energy facilities were more focussed on gas infrastructure this time, via Reuters citing sources.
  • UBS expects copper prices to rise to the USD 10-11k MT range, expects demand to rise above 3% Y/Y in 2025. Sees copper market that is modestly in deficit of around 250,000 .

Geopolitics

  • US President-elect Trump said "For the great privilege of accessing our markets, these foreign companies should hire our incredible American Workers, instead of laying them off, and sending those profits back to foreign countries", via Truth Social.
  • US President-elect Trump is weighing options for stopping Iran from being able to build a nuclear weapon, including the possibility of preventive airstrikes, according to WSJ.
  • US Secretary of State Blinken says that in the last few weeks he has seen encouraging signs that a Gaza ceasefire is possible
  • Israeli Defense Minister orders Israeli troops to prepare to remain on Mount Hermon during winter months, via Reuters citing a statement
  • Russian attacks on Ukrainian energy facilities were more focussed on gas infrastructure this time, via Reuters citing sources.
  • US Sectary of State Blinken says that in the last few weeks he has seen encouraging signs that a Gaza ceasefire is possible.

US Event Calendar

  • 08:30: Nov. Import Price Index MoM, est. -0.2%, prior 0.3%
  • 08:30: Nov. Export Price Index YoY, est. 0.3%, prior -0.1%
  • 08:30: Nov. Export Price Index MoM, est. -0.3%, prior 0.8%
  • 08:30: Nov. Import Price Index YoY, est. 1.0%, prior 0.8%

DB's Jim Reid concludes the overnight wrap

We had the London FIC and Macro Research Xmas Party last night and I hope none of my colleagues will be offended if I say it was a relatively tame but pleasant affair and very different to the ones of my early years in banking. However, it wasn't without shock as after having known him for more than ten years I learnt for the first time that my colleague Luke represented Australia in his specialist discipline. I'll keep you guessing what that was in and reveal the answer at the end.

Markets have lost a little poise over the last 24 hours, as the combination of underwhelming data and comments from ECB President Lagarde led to a cross-asset sell-off. That was most evident among sovereign bonds, and there was disappointment that the ECB didn’t take an even more dovish tone, not least after Lagarde said that inflation risks were “two-sided”. On top of that, the US PPI inflation reading surprised on the upside, even if core and the components that feed directly into core PCE were a touch softer. However, the year-on-year rate rose above 3% again for the first time since early 2023. So that led to a bit more doubt about how fast any rate cuts would be next year (remember DB think none after next week), and the S&P 500 also ended the day -0.54% lower. Although the S&P 500 is only -0.64% beneath its record high, yesterday was the ninth day in a row that more constituents fell than rose in the index, the longest such run since 2001, a fairly stunning stat. So ex-tech, the market is losing some momentum even if the aggregate moves are still small.

Starting with the ECB, the headline decision was much as expected, with a 25bp cut that took the deposit rate down to 3%. Moreover, the statement had some dovish shifts, as it dropped the language about keeping rates “sufficiently restrictive” to get inflation back to target. That was supported by the latest economic forecasts, which saw growth and inflation both downgraded over the years ahead. For instance, they now see growth in 2025 at just 1.1%, down two-tenths from last quarter, whilst the 2026 number was also revised a tenth lower to 1.4%. Meanwhile on inflation, they now expect headline inflation to fall to 2.1% in 2025, down a tenth from before, before falling to 1.9% in 2026.

But in spite of those seemingly dovish elements, European sovereign bonds saw a heavy sell-off yesterday. Indeed, yields on 10yr bunds (+7.8bps), OATs (+9.8bps) and BTPs (+15.9bps) all moved sharply higher. That sell-off began as Lagarde’s Q&A comments did little to follow through on the dovish points in the statement or the forecasts, and avoided getting drawn on the size and speed of future cuts. So while the direction of travel towards lower rates is clear, these comments cast doubt on how aggressively the ECB would actually cut rates next year. That said, our European economists see the latest ECB signal as consistent with maximal optionality and continue to see the risk of larger 50bp cuts, although the bar for such a move at the next meeting in January feels high. Given their expectation of below-trend growth and below-target inflation, our economists maintain a baseline of a below-neutral 1.50% terminal rate by end-2025. See their full reaction piece here.

Whilst the ECB provided the main attention yesterday, there were a couple of US data prints that also disappointed investors. In particular, the PPI reading for November came in on the upside, which added to the sense that inflation was still lingering in a zone that would make it difficult to cut rates much further. For instance, the monthly headline PPI was running at +0.4% (vs. +0.2% expected), and the previous month’s reading was revised up a tenth to +0.3%. In turn, that pushed the year-on-year reading up to +3.0% (vs. +2.6% expected). However, the upside PPI surprise was in part due to one-offs (notably egg prices of all things), and with some respite from categories that feed into PCE inflation (which the Fed targets). These were on the weaker side alongside core PPI which printed at +0.1% MoM, below the +0.2% expected. So on paper, that still gives the Fed space to cut rates at next week’s meeting, even if the moves beyond that are in more doubt. In my opinion, there’s enough concern on inflation not to cut next week, but the Fed doesn’t like to provide big surprises to markets this close to the event, and with investors now pricing a 96% chance of a cut, the Fed would have to act astonishingly out of character to not do so.

The other release of potential concern were the weekly jobless claims, which saw initial claims at 242k over the week ending December 7 (vs. 220k expected), above every economist’s expectation on Bloomberg. Continuing claims for the previous week also surprised to the upside (1886k vs 1877k expected), though data may have been distorted by seasonal factors post-Thanksgiving. And while Treasuries initially rallied following the US data, the bond sell-off that has dominated so far this week resumed as the day wore on. By the close, 2yr (+3.9bps) and 10yr yields (+5.7bps) both posted a fourth consecutive increase to 4.19% and 4.33%, respectively. This leaves 10yr yields on course for their biggest weekly rise since early October (+17.5bps so far).

For equities it was also an underwhelming session yesterday. This was most visible in the US, where the S&P 500 was down -0.54%, and the small-cap Russell 2000 fell by a larger -1.38%. The tech megacaps also suffered from the downbeat mood, with the Magnificent 7 (-0.71%) reversing some of its +3.09% gain the previous day. As mentioned at the top, the number of decliners outpaced the advancers for a ninth consecutive session. Meanwhile in Europe, the losses were more marginal with the STOXX 600 down -0.14% and several indices posting modest gains, as the DAX (+0.13%) just about moved up to a new record.

Elsewhere in Europe, Swiss bonds outperformed after the Swiss National Bank delivered a 50bp rate cut yesterday. That came as something of a surprise, as both market pricing and the consensus of economists had leant towards a 25bp move as more likely. So there was a decent market reaction, which left the country’s 10yr yields down -0.7bps on the day, in contrast to the sizeable moves higher across the rest of Europe. In addition, the Swiss franc weakened by -0.37% against the US Dollar.

Overnight in Asia, equity markets are mostly sliding after the readout from China’s Central Economic Work Conference (CEWC) didn’t have much new policy details. That’s meant Chinese equities are underperforming, with the CSI 300 (-1.67%) and the Shanghai Comp (-1.36%) both losing ground, and the Hang Seng is also down -1.66%. Elsewhere, the Nikkei (-0.91%) is also trading noticeably lower, along with Australia’s S&P/ASX 200 (-0.41%). The one exception to this pattern is the KOSPI (+0.43%), and looking forward, US equity futures are pointing to a modest recovery, with those on the S&P 500 (+0.07%) and NASDAQ 100 (+0.28%) trading higher.

There was also a significant milestone in Chinese bond markets, as the 10yr government bond yield fell beneath 1.8% for the first time ever. That continues the downward momentum in Chinese yields over recent months, and the country’s 30yr yields are already trading beneath Japan’s 30yr yields.

In terms of data overnight, the Bank of Japan’s quarterly Tankan report showed that sentiment among the biggest Japanese manufacturers moved up to 14 in Q4, which was the highest reading since Q1 2022. However, the index for large non-manufacturers ticked down a point from last quarter to 33. In the meantime, the Japanese yen (-0.23%) is on track to weaken for a fifth consecutive session, and is currently trading at 152.97 against the dollar, its weakest since November 26.

To the day ahead now, and data releases include UK GDP for October and Euro Area industrial production for October. Meanwhile from central banks, we’ll hear from the ECB’s Villeroy, Holzmann and Centeno.

Tyler Durden Fri, 12/13/2024 - 08:27

EUR Rallies As Macron Names 'Centrist' Francois Bayrou As New French PM

EUR Rallies As Macron Names 'Centrist' Francois Bayrou As New French PM

Centrist politician Francois Bayrou has been announced as France’s new prime minister.

On Dec. 5, French lawmakers from all sides of the political spectrum voted to remove conservative Michel Barnier from the powerful post, signaling deepening divisions within the French parliament.

On Friday, President Emmanuel Macron named François Bayrou - a French centrist and a longstanding ally - to the role of prime minister.

As Owen Evans reports via The Epoch Times, Macron has vowed to remain in the Elysee Palace for the duration of his term, which runs until mid-2027.

Before then, he cannot be ousted by Parliament, although opposition on both his left and right flanks are already calling for his resignation.

Macron is being pulled in multiple directions, caught between a left-wing coalition that includes his own party, La France Insoumise, the Socialist Party, the Ecologists, and the French Communist Party, and the right-wing National Rally.

Bayrou will have to navigate the uncertainty around the deeply divided parliament has also made it increasingly difficult for the government to pass the 2025 budget.

The country’s debt is projected to soar to above 3 trillion euros ($3.17 trillion) by 2025, with public debt hovering at around 110 percent of GDP.

Despite the uncertainty, the euro is rallying on the news...

Parliament will likely approve a Special Law before the end of the year to roll over the 2024 budget. This is consistent with a meaningful amount of austerity mainly focused on departmental spending restraint. However, the deficit will remain very wide.

Centrist parties might agree on a “non-aggression” pact to prevent the next government from collapsing, but the need for substantial fiscal consolidation will continue to make the approval of a budget for 2025 challenging.

Bayrou is a long-time centrist politician known for his negotiation skills. Macron wants him to reach an agreement with centrist parties, so they at least refrain from filing no-confidence motions against the new government.

The center-left Socialist Party (PS) and the center-right Republican Right (DR) do not want to be associated with each other or with Macron.

However, they both have an incentive to differentiate themselves from LFI and RN by portraying those parties as irresponsible for creating political instability. Therefore, they might potentially acquiesce to some sort of non-aggression pact.

The biggest risk for political centrism is that parties such as Marine Le Pen’s far-right National Rally (RN) or Jean-Luc Melanchon's France Unbowed (LFI) might benefit electorally by blaming the centrists for the country’s potentially poor economic performance.

The bottom line is that France now has a new prime minister, and the government to be formed in the coming days might be more stable than the last.

But the divisions that have paralyzed the budget process remain and a break in the political logjam looks a long way off.

All this will probably weigh on an economy that is already losing momentum.

Tyler Durden Fri, 12/13/2024 - 08:11

US Supreme Court Bucks Nvidia's Appeal To Dismiss Crypto Class-Action Suit

US Supreme Court Bucks Nvidia's Appeal To Dismiss Crypto Class-Action Suit

Authored by Jesse Coghlan via CoinTelegraph.com,

Nvidia faces a class-action suit alleging it misled investors about the volume of sales to crypto miners after the United States Supreme Court dismissed the chip maker’s appeal to throw it out.

The justices issued a one-line order on Dec. 11, dismissing Nvidia’s appeal without providing any explanation. The decision effectively reinstated an appellate court ruling that revived the lawsuit, initially dismissed by a California district court in March 2021.

Nvidia was looking to overturn the Ninth Circuit appeals court ruling from last August that revived the 2018 suit by a group of Nvidia shareholders claiming the firm hid over $1 billion in GPU sales made to crypto miners and that CEO Jensen Huang downplayed the volume of sales to the industry.

“We would have preferred a decision on the merits affirming the trial court’s dismissal of the case, but we are fully prepared to continue our defense,” an Nvidia spokesperson told Cointelegraph. 

“Consistent and predictable standards in securities litigation are essential to protecting shareholders and ensuring a strong economy, and we remain committed to supporting them.”

The Supreme Court’s order did not explain why it denied Nvidia’s appeal. Source: Supreme Court of the United States

In the suit, the shareholders alleged Nvdia’s GPU sales were propped up by selling to crypto miners, referencing a point in time when sales collapsed in line with the falling crypto market in late 2018, which sent Nvidia’s share price tumbling nearly 30% over two days.

Nvidia argued that the suit relied on fabricated information about its business and income. In October, the class group got back-up from the Justice Department and the Securities and Exchange Commission, which said Nvidia’s argument “is not what occurred here.” 

The agencies highlighted the investors’ case, which reportedly includes evidence such as statements from former Nvidia executives and a Bank of Canada report alleging that Nvidia understated its cryptocurrency revenue by $1.35 billion.

The Supreme Court’s dismissal came after it heard arguments on Nov. 13, when some of the justices questioned why the court agreed to hear the case and if it even presented an issue that would require a ruling.

In 2022, Nvidia paid $5.5 million to the SEC to settle charges that it inadequately disclosed the impact of crypto mining on its gaming business, without admitting or denying the agency’s findings.

Tyler Durden Fri, 12/13/2024 - 07:45

Russia Launches Massive Attack On Ukrainian "Critical Fuel & Energy Infrastructure"

Russia Launches Massive Attack On Ukrainian "Critical Fuel & Energy Infrastructure"

Russia launched a massive drone and missile strike against Ukraine on Friday in retaliation for Kyiv's recent use of the US-supplied Army Tactical Missile System (ATACMS) against a Russian military base.

ABC News quoted Ukrainian President Volodymyr Zelenskyy, who said Russia launched 93 missiles and nearly 200 drones targeting the country's energy infrastructure. This was one of the largest bombardments against Ukraine's energy sector since the invasion began almost three years ago.

Zelenskyy said Ukrainian defense forces intercepted 81 missiles, including 11 cruise missiles shot down by Western-supplied General Dynamics F-16 Fighting Falcon fighter jets.

He accused Russia of continuing to "terrorize millions of people" with these reckless assaults, renewing his request to the international community for intervention and more support for Ukraine.

"A strong reaction from the world is needed: a massive strike – a massive reaction. This is the only way to stop terror," Zelenskyy said.

Meanwhile, the Russian Defense Ministry published a statement on its official Telegram channel, claiming that the retaliatory strike hit all intended targets:

"In response to the use of American long-range weapons, Russia's Armed Forces launched a massive strike with high-precision long-range air- and sea-based weapons and UAVs on critical fuel and energy infrastructure facilities in Ukraine that support the operation of the military-industrial complex."

On Wednesday, Ukraine fired six ATACMS at a Russian airfield inside the country's sovereign territory. Russia claimed after the attack that all missiles were intercepted.

Reports on X indicate that Ukraine's state-run energy company, Ukrenergo, warned that up to 50% of residential customers could be without power after today's attack.

Tyler Durden Fri, 12/13/2024 - 07:20

Goldman Delivers Grim Outlook For Prospective Homebuyers

Goldman Delivers Grim Outlook For Prospective Homebuyers

Goldman's latest note to clients offers little optimism for resolving the housing affordability crisis in 2025. Mortgage rates are expected to remain elevated while housing prices trend at record highs, further exacerbating challenges for prospective buyers and likely keeping many on the sidelines. 

"Our mortgage strategy team's expectations rates will hold in the low-to-mid 6% range" next year, said analysts Susan Maklari and Charles Perron-Piche, adding, "This will keep existing home sales 24% below the 2015-19 average." 

They offered clients the understanding that there would be no meaningful relief for prospective buyers as the affordability crisis will linger through next year: 

"Despite our macro team predicting another 125bps of Fed rate cuts through September 2025, our credit strategy team forecasts the 30-year fixed mortgage rate will end 2025 at 6.3%, down just 30bps from 6.6% anticipated at the end of this year and only 39bps below current levels."

Given the latest inflation data, a largely in-line CPI report followed by a 'red hot' PPI print in November, this data suggests that longer-term yields are to stay higher over the medium- to longer-term, according to Bloomberg's Simon White.

In other words, White suggests that this inflation data squashes the dovish party. As of late Thursday, the market is pricing in only two rate cuts for next year.

Goldman analysts noted that without interest rate relief and the general leanness of housing inventory, home prices are forecasted to increase by 3% YoY. 

"Said differently, we estimate the mortgage payment on a median-priced single-family home is 35% of the median household income. Although this is down from 39% a year ago, it remains well above the 30% threshold for most lenders," they explained.

The analysts then provided clients with a state affordability tracker for the last month. 

Impact of Changing Rates and Home Prices on Monthly Mortgage Payments as a % of Income

"The affordability headwinds will be most pronounced on resales, with existing home transactions holding at 4.1mn in 2025 vs the 2015-19 average of 5.4mn. This reflects the lock-in effect, which we believe will remain a headwind for the next several years," the analysts said, adding, "Homeowners would be reluctant to move even if rates declined to the high-5% range."

Goldman has delivered some grim news for prospective homebuyers sitting on the sidelines: the affordability crisis is nowhere near being resolved.

Tyler Durden Fri, 12/13/2024 - 06:55

Can The "Wave Of Replacement Jet Demand" Revive Boeing?

Can The "Wave Of Replacement Jet Demand" Revive Boeing?

Goldman analysts remain "bullish on commercial aerospace into 2025," forecasting a replacement wave of aging commercial jet fleets by the end of the decade. This bullish view comes as Boeing navigates a turnaround period following challenges that include the twin Max jet crashes, mid-air incidents, production safety vulnerabilities, a seven-week factory strike, and mounting financial pressures. Encouragingly, production at Boeing's Renton factory in Seattle has restarted, marking a positive step forward for the company.

Analysts Noah Poponak and Anthony Valentini cited the latest global air travel data, which shows a healthy recovery in flights to their pre-pandemic level. 

Boeing and Airbus have seen a strong aircraft order cycle and years of backlogs. 

"Air travel demand has largely recovered, bringing with it a renewed wave of aircraft demand thanks to both capacity and replacement needs. Boeing and Airbus are supplying aircraft well below this demand as the supply chain continues to experience delays, materials shortages, and other issues," the analyst said, adding, "Boeing production has been curtailed by product quality improvements following the Alaska Airlines MAX incident at the beginning of 2024, and was further delayed by the IAM Union workers' strike in September. We think the supply chain will continue to normalize throughout 2025." 

Poponak modeled aircraft deliveries recovering to 2018 levels in 2026. He expects "global air travel exceeds pre-pandemic in 2025, and that higher retirement demand will support elevated new aircraft orders." 

"Aerospace is a long-cycle industry, and we believe that 2025 will be another early year in a multiple-year recovery ahead," he said. 

Aircraft retirements have remained subdued since 2021, mostly because of low delivery volumes and production delays at Airbus and Boeing. 

What has piqued our interest is whether Boeing's turnaround plan can be effectively implemented and production restarted smoothly in Renton. If successful, the company could position itself for a new era ahead of a replacement wave of commercial jet fleets expected to ramp up in the coming years. 

In markets, Boeing shares have been clobbered over the years, trading in a tight range between $100 and $250. 

Here's why the analysts are bullish on Boeing:

Boeing has a new CEO, IAM union workers have returned to work following a 50+ day strike, and the company raised $21bn of new equity capital, resolving near-term liquidity and credit rating concerns as the company heads into 2025. Boeing still needs to solve a number of challenges going forward, but we think much of that is priced into the stock at this point. We view Defense leadership changes and the exploration of non-core asset sales as positive steps in Boeing's efforts to normalize the earnings power of those businesses. We think Boeing can produce ~38 MAX and ~8 787 / month by 3Q25, at which point we expect the company to begin generating positive free cash.

The analysts listed other "Buy" recommendations within the aviation industry:

  • Woodward - Buy, on the CL: WWD's significant content gains on next generation narrowbody aircraft - thanks largely to content gains on the LEAP and GTF engines - will create an installed base that should drive substantial aftermarket revenues to the company over time. The company's Industrial business has pieces that can create quarterly volatility, but it also has a potential much larger secular growth business in power generation, while core margins in the segment are moving higher.

  • GE Aerospace - Buy: We expect GE's LEAP engine to continue driving meaningful share gains, and think it is likely that engine shop visit and aftermarket growth will remain strong for several years. GE is still dealing with supply chain issues, which at times forces it to rationalize where it sends limited components, but the company remains focused on increasing commercial engine output. This should drive even higher levels of aftermarket activity once those engines become part of the installed base. We think margins likely have upside from here as GE passes through pricing, particularly on LEAP, and as LEAP aftermarket matures, allowing the company to return excess cash to shareholders through dividends and buybacks.

  • Howmet - Buy: We think HWM's initial FY25 revenue outlook (+7.5%) is conservative as the company continues to benefit from increased spares volumes and pricing given industry-wide engine time on wing issues and low OEM production rates. The stock has moved higher and has a relatively high bar, but we think the multiple re-rating is warranted given the potential for this business to outgrow its end market through pricing and share gains, as well as its history of shareholder-friendly capital deployment.

  • CAE - Buy: CAE has a high-quality aerospace business that drives recurring revenues, above end-market growth, and strong margins thanks to its large share of the simulation and training market. The defense business is showing improvement as CAE works through challenged contracts and books higher quality revenues, and we think the stock is attractive given CAE's discounted valuation.

  • Ducommun - Buy: As OEMs ramp production to meet strong demand, we expect DCO to benefit from its exposure to aerospace OEs. DCO is also growing its aerospace aftermarket exposure and share in defense end-markets, leveraging both price and cost to expand margins. We think the business can drive substantial earnings growth over time and currently trades at a discount to peers.

  • TransDigm - Buy: As an M&A compounder with high aftermarket exposure, TransDigm operates one of the best business models across our coverage, and we think it should remain a core holding in the aerospace supply chain. The company has an extensive track record of operating performance, margin expansion, and efficient capital deployment, which we expect to continue in spite of renewed scrutiny around TDG's sale of spare parts to the DoD and its pricing model.

  • HEICO - Buy: Heico is well-positioned within the aerospace supply chain as one of the more unique business models we cover. The Wencor integration is progressing well (product portfolio combinations, cross-selling, resource sharing), and significantly expands HEI's presence in aftermarket PMA. Going forward, we think HEI has the ability to grow share, pricing, and compound cash flow over the long-term as it executes on strategic M&A.

  • Textron - Buy: The business jet end market remains structurally healthy, and the company expects Aviation operations to normalize by the start of 2025, which should benefit from slipped 4Q aircraft deliveries. Bell continues to be a bright spot for the company, which has experienced strong helicopter deliveries and solid FLRRA momentum, which we expect to continue.

  • Bombardier - Buy: With nearly $15bn in backlog, BBD has a multi-year runway for aircraft delivery and free cash growth. The tight supply / demand dynamic in the business jet market favors the OEs who can pass on price, and BBD's recurring high-margin services business continues to grow. At only ~8X our 2026 FCF estimates, we think BBD is attractive at current levels.

  • Embraer - Buy: Embraer has a solid position in the regional jet market, business jet supply / demand remains tight, and the company has growth ahead in its defense business from the KC-390. The company is improving its margins and cash flow as management drives operating performance, which we expect to continue.

Forward-looking valuations across aerospace do not appear 'bubbly' like other parts of the market. 

The forecasted wave of replacement jet demand could offer Boeing a much-needed boost, lifting it out of its multi-year bear market in the years ahead. Keep in mind that aerospace is a long cycle.

Tyler Durden Fri, 12/13/2024 - 05:45

Escobar: Syria's Post-Mortem - Terror, Occupation, And Palestine

Escobar: Syria's Post-Mortem - Terror, Occupation, And Palestine

Authored by Pepe Escobar via The Cradle,

The short headline defining the abrupt, swift end of Syria as we knew it would be: Eretz Israel meets new-Ottomanism. The subtitle? A win-win for the west, and a lethal blow against the Axis of Resistance.

But to quote still-pervasive American pop culture, perhaps the owls are not what they seem.

Let’s start with former Syrian President Bashar al-Assad’s surrender. Qatari diplomats, off the record, maintain that Assad tried to negotiate a transfer of power with the armed opposition that had launched a major military offensive in the days prior, starting with Aleppo, then swiftly headed southward toward Hama, Homs, aiming for Damascus. That’s what was discussed in detail between Russia, Iran, and Turkiye behind closed doors in Doha this past weekend, during the last sigh of the moribund “Astana process” to demilitarize Syria.

The transfer of power negotiation failed. Hence, Assad was offered asylum by Russian President Vladimir Putin in Moscow. That explains why both Iran and Russia instantly changed the terminology while still in Doha, and began to refer to the “legitimate opposition” in a bid to distinguish non-militant reformists from the armed extremists cutting a swathe across the state.  

Russian Foreign Minister Sergey Lavrov – his body language telling everything about his anger – literally said, “Assad must negotiate with the legitimate opposition, which is on the UN list.” 

Very important: Lavrov did not mean Hayat Tahrir al-Sham (HTS), the Salafi-jihadi, or Rent-a-Jihadi mob financed by the Turkish National Intelligence Organization (MIT) with weapons funded by Qatar, and fully supported by NATO and Tel Aviv. 

What happened after the funeral in Doha was quite murky, suggesting a western intel remote-controlled coup, developing as fast as lightning, complete with reports of domestic betrayals. 

The original Astana idea was to keep Damascus safe and to have Ankara manage HTS. Yet Assad had already committed a serious strategic blunder, believing in lofty promises by NATO messaged through his newfound Arab leader friends in the UAE and Saudi Arabia.    

To his own astonishment, according to Syrian and regional officials, Assad finally realized how fragile his own position was, having turned down military assistance from his stalwart regional allies, Iran and Hezbollah, believing that his new Arab allies might keep him safe.

The Syrian Arab Army (SAA) was in shambles after 13 years of war and ruthless US sanctions. Logistics were prey to deplorable corruption. The rot was systemic. But importantly, while many were prepared to fight the foreign-backed terror groups once again, insiders say Assad never fully deployed his army to counterattack the onslaught.

Tehran and Moscow tried everything – up to the last minute. In fact, Assad was already in deep trouble since his visit to Moscow on 29 November that reaped no tangible results. The Damascus establishment thus regarded Russia’s insistence that Assad must abandon his previous red lines on negotiating a political settlement as a de facto signal pointing to the end. 

Turkiye: ‘we have nothing to do with it’

Apart from doing nothing to prevent the increasing atrophy and collapse of the SAA, Assad did nothing to rein in Israel, which has been bombing Syria non-stop for years. 

Until the very last moment, Tehran was willing to help: two brigades were ready to get into Syria, but it would take at least two weeks to deploy them.      

The Fars News Agency explained the mechanism in detail – from the Syrian leadership's inexorable lack of motivation to fight the terror brigades to Assad ignoring serious warnings from Iranian Supreme Leader Ali Khamenei since June, all the way to two months ago, with other Iranian officials warning that HTS and its foreign backers were preparing a blitzkrieg. According to the Iranians: 

“After Aleppo fell, it became clear that Assad had no real intentions of staying in power, so we started to engage in diplomatic talks with the opposition, and arranged the safe exit of our troops from Syria. If the SAA does not fight, neither will we risk our soldiers' lives. Russia and the UAE had managed to convince him to step down, so there was nothing we could do.”

There’s no Russian confirmation that they convinced Assad to step down: one just needs to interpret that failed meeting in Moscow on 29 November. Yet, significantly, there is confirmation, before that, about Turkiye knowing everything about the HTS offensive as far back as six months ago. 

Ankara’s version is predictably murky: HTS told them about it, and asked them not to intervene. Additionally, the Turkish Foreign Ministry spun that President-Caliph Recep Tayyip Erdogan tried to warn Assad (no word from Damascus on that). Ankara, on the record, via Foreign Minister Hakan Fidan, firmly denies orchestrating or approving the Rent-a-Jihadi offensive. They may regret this yet, with everyone from Washington to Tel Aviv jumping in to take credit for the fall of Damascus.

Only the NATO propaganda machine believes this version – as HTS has been for years completely supported not only by Turkiye, but also, covertly, by Israel, which was outed for paying salaries to the extremists during the Syrian war, and famously helped rehabilitate Al-Qaeda fighters injured in battle. 

All that leads to the predominant scenario of a carefully calculated CIA/MI6/Mossad controlled demolition, complete with a non-stop weaponizing flow, Ukrainian training of takfiris on the use of FPV kamikaze drones, and Samsonites full of cash bribing high-ranking Syrian officials. 

New Great Game reloaded

The Syrian collapse may be a classic case of “extending Russia” – and also Iran, when it comes to the all-crucial land bridge that connects it with its allies in the Mediterranean (the Lebanese and Palestinian resistance movements). Not to mention sending a message to China, which, for all its lofty “community of a shared future” rhetoric, had done absolutely nothing to help in the reconstruction of Syria. 

On the geo-energy level, now there are no more obstacles to the resolution of an epic Pipelineistan saga – and one of the key reasons for the war on Syria, as I analyzed it nine years ago: building the Qatar–Turkiye gas pipeline through Syrian territory to provide Europe with an alternative to Russian gas. Assad had rejected that project, after which Doha helped fund the Syrian war to depose him.

There’s no evidence that key Persian Gulf states such as Saudi Arabia and UAE will gleefully accept Qatar’s geoeconomic stardom if the pipeline is built. For starters, it needs to run through Saudi territory, and Riyadh may no longer be open to that. 

This burning question connects to a pile-up of other questions, including, with the Syrian gateway all but gone: how will Hezbollah receive weapons supplies in the future, and how will the Arab world react to Turkiye trying to go full Neo-Ottoman?   

Then there’s the thorny case of BRICS partner-state Turkiye directly clashing with top BRICS members Russia, China, and Iran. Ankara's new turn may even end up causing it to be rejected by BRICS, and not granted a favorable trade status by China. 

While a case can certainly be made that losing Syria may be devastating for Russia and the Global Majority, hold those horses - for now. In the event of losing the port of Tartous that the USSR-Russia has run since 1971, alongside the Hmeimim air base – and thus being ousted from the Eastern Mediterranean – Moscow would have replacing options, with different degrees of feasibility. 

We have Algeria (a BRICS partner), Egypt (a BRICS member), and Libya. Even the Persian Gulf: that, incidentally, could become part of the Russia–Iran comprehensive strategic partnership, to be officially signed on 25 January in Moscow by Putin and his Iranian counterpart President Masoud Pezeshkian. 

It's extremely naïve to assume that Moscow was caught by surprise by the staging of an alleged Kursk 2.0. As if all Russian intel assets – bases, satellites, ground intel - would not have scrutinized a bunch of Salafi-Jihadis for months assembling an army of tens of thousands in Greater Idlib, complete with a tank division.   
So it’s quite plausible that what’s being played is classic Russia, combined with Persian guile. It didn’t take long for Tehran and Moscow to do the math on what they would lose – especially in terms of human resources – by falling into the trap of supporting an already enfeebled Assad in yet another bloody, protracted ground war.  Still, Tehran offered military support, and Moscow, air support, and negotiations scenarios till the very end.

Now, the whole Syrian tragedy – including a possible Caliphate of all-Sham led by reformed, minority-hugging jihadist Abu Mohammad al-Julani – falls into the full managing responsibility of the NATO/Tel Aviv/Ankara combo. 

They are simply not prepared to navigate the ultra-complex tribal, clannish, embedded in corruption Syrian matrix – not to mention the magma of 37 terror outfits only kept together, so far, by the tiny glue of ousting Assad. This volcano will certainly explode in their collective faces, potentially in the form of horrendous internal battles that may last at least a few years.   

Syria’s northeast and east are already, instantly, mired in total anarchy, with a multitude of local tribes bent on keeping their mafioso schemes at all costs, refusing to be controlled by a US–Kurd Rojava composite that is largely communist and secular. Some of these tribes are already getting cozy with the Turk-supported Salafi-jihadis. Other Arab tribes had this year joined forces with Damascus against both the extremists and Kurdish secessionists.    

Western Syria may also be anarchy territory, as in Idlib: bloody rivalry between terror and bandit networks, between clans, tribes, ethnic groups, and religious groups regimented by Assad, the panorama even more complex than in Libya under former President Muammar al-Gaddafi. 

As for the Head-Choppers' supply lines, they will inevitably be stretched – and then it will be easy to cut them off, not only by Iran, for instance, but also by the NATO wing via Turkiye/Israel when they turn against the Caliphate, as they invariably may if the latter's abuses become too media-apparent.   
No one is able to foresee what will happen to the carcass of Assad-dynasty Syria. Millions of refugees may return, especially from Turkiye, which Washington has for years tried to prevent to protect its “Kurdification” project in the north - but at the same time, millions will flee, terrified by the prospect of a new Caliphate and a renewed civil war.

Is there a possible ray of light amongst such gloom? The leader of the transition government will be Mohammad al-Bashir, who was, until recently, the prime minister of the so-called Syrian Salvation Government (SSG) in HTS-ruled Idlib. An electrical engineer by training, Bashir added a further degree to his education in 2021: Sharia and law.

Losing Syria should not mean losing Palestine 

The Global Majority may be mourning what, on the surface, looks like a nearly lethal blow against the Axis of Resistance. Yet there’s no way Russia, Iran, Iraq – and even thunderously silent China – will let a NATO-Israel-Turkiye-backed Salafi-jihadi proxy army prevail. Unlike the collective west, they are smarter, tougher, infinitely more patient, and consider the contours of the Big Picture ahead. It’s too early; sooner or later they will start rollin’ to prevent western-backed jihadism from spilling into Beijing, Tehran, and Moscow.  

Russian foreign intel agency Sluzhba Vneshney Razvedki (SVR) now has to be monitoring 24/7 what will be the next destination of the large cross-Heartland Salafi-jihadi brigade in Syria, overwhelmingly Uzbeks, Uighurs, Tajiks, and a sprinkle of Chechens. There’s no question they will be used to “extend” (US Think Tankland terminology) not only Central Asia but the Russian Federation. 
Meanwhile, Israel will be overstretched in the Golan. The Americans will temporarily feel safe and secure around the oil fields from which they will keep stealing Syrian oil. These are two ideal latitudes for the start of what would be the first concerted BRICS retaliation against those who are unleashing the First BRICS War.  

Then there’s the ultimate tragedy: Palestine. A massive plot twist took place right inside the venerable Umayyad mosque in Damascus. The NATO-Israeli-Turk Head-Chopping Army is now promising the Palestinians they are coming to liberate Gaza and Jerusalem. 

Yet until this past Sunday, it was all “We love Israel.” The MC of this PR op – designed to fool the Muslim world and the Global Majority - is none other than the Caliph of al-Sham himself, Julani.

As it stands, the new regime in Damascus will be, for all practical purposes, backed by those who support and engineer Eretz Israel and the genocide of Palestine. It’s already out in the open, coming from Israeli cabinet officials themselves: Tel Aviv ideally would love to expel the population of Gaza and the West Bank to Syria, though Jordan is their preferred destination.

This is the battle to focus on from now on. The late Hezbollah secretary-general Hassan Nasrallah was adamant when he insisted on the deeper meaning of losing Syria: “Palestine would be lost.” More than ever, it’s up to a Global Resistance not to allow it. 

Tyler Durden Thu, 12/12/2024 - 22:35

Gold & The Evil Cycles Of War And Economic Destruction

Gold & The Evil Cycles Of War And Economic Destruction

Authored by Egon von Greyerz via vongreyerz.gold,

As we approach what usually should be a blissful holiday period, the treacherous path the world is now on does not bode well for 2025 and beyond.

Two global crises will dominate the world for at least several years and possibly decades.

FINANCIAL CRISIS

The crisis I have been discussing and writing about for many years is the end of the current monetary era, especially in the West. The exponential growth of debt, which we have experienced since 1971 when Nixon closed the gold window, is reaching an uber-exponential phase in the current century with runaway deficits and debt. 

The likely course of events is unlimited money printing to counter an uncontrollable debt crisis. This leads to monetary debasement, high inflation or hyperinflation, which eventually turns into a deflationary collapse of the financial system and depression. 

THERE CAN BE NO CLEARER SIGN OF THE END OF AN ECONOMIC ERA THAN WHEN THE RESERVE CURRENCY DECLINES BY 99%.  

A possible alternative would be that the financial system implodes before the money printing has taken effect, with a subsequent deflationary implosion. This would mean a period without functioning banks and money. 

As this is the way every monetary system has ended in history, without fail, anyone questioning this inevitable outcome will be entirely wrong. It is only a question of when, not if. 

As the Austrian economist von Mises said:

As always in history, an economic crisis always goes hand in hand with political or geopolitical turmoil. 

When a country spends money it doesn’t have, starting a war is the most convenient way of creating new paper money, which, of course, has ZERO intrinsic value. 

Expanding credit or printing money does not create economic value, but buys time.

Money printing also buys votes. Reelection is the primary objective of any government in a democratic system.

Consecutive US governments have increased US Federal debt almost every year since the early 1930s. 

The current deficit is over $2 trillion, and tax revenue is only $5 trillion. With over $7 trillion in federal spending, the US government needs to borrow another 40% on top ($2T) to make ends meet.

I created the graph below in November 2016, when Trump was elected the 45th President of the United States. I forecast that 8 years later (whoever was president), the debt that Trump inherited ($20 trillion) would be $40 trillion in early 2025. I based the forecast on a simple extrapolation. Since 1981, US debt has, on average, doubled every 8 years. Well, the debt will probably not reach $40T by 20 January 2025, but still, it went up by $16T rather than the $20T that I forecast. 

More importantly, as the graph below shows, debt has increased 44X since 1981, but tax revenue has only increased 6X to $4.9T.  

Can anyone explain how this debt will be repaid? The standard reply is that governments don’t need to repay their debt. 

Well, let me again cite history, which is such a useful empirical tool. 

Throughout history, a country which has not repaid its debts has, without fail, always defaulted, and the currency has gone to ZERO. 

No one must believe that it will be different this time!

A monetary crisis at the end of a major cycle leads to economic collapse, poverty and misery. 

However, this current financial cycle is already developing in parallel with a geopolitical crisis of a magnitude and scale that could be greater than those of WWI and WWII. 

GEOPOLITICAL CRISIS 

The financial and geopolitical conflicts are clearly linked. As in many armed conflicts, the US has been involved since WWII, although the country is not directly threatened.

This has been the case in Vietnam, Afghanistan, Iraq, Libya, Syria and Ukraine. 

Most of these wars are about fear of losing the US hegemony. The US government subscribes to the 1904 Mackinder theory that whoever controls the Heartland controls the world. The Heartland is the area of Eastern Europe stretching to the Yangtze River in the east and the Himalayas in the south. This area has massive natural resources. 

Syria probably just fell to opposition groups backed by Turkey in an attack supported by the US military. Interestingly, the latest conflict started the same day as the ceasefire between Israel and Lebanon. Clearly, it’s not a coincidence. 

So Turkey, which for a while has ridden two horses, a Russian and an American, has now taken the US side. 

Turkey is a NATO member and also a prospective BRICS member, among others, Russia, China, Iran and India. 

With Turkey now on the US side and against Russia, we see the first military conflict between the West and BRICS.  

Nobody knows if Syria will regroup again with Assad in Moscow and the soldiers deserting the army. For the Russia – Iran axis, Syria is strategically critical. But Russia cannot win that war with just air power and most probably does not want to divert resources from Ukraine. 

Thus, we now have yet another crisis in the Middle East, a situation with dire consequences for the area and the world.

So we are likely to see continued war in Syria, with anarchy and the rise of more jihadist groups. 

As Thanassis Cambanis, a senior fellow at the Century Foundation, said: “In the best case scenario, Syria’s factions will struggle for primacy through contained local battles. At the other extreme, the collapse will spur a renewed period of total warfare in which factions target civilians.”

So, it is likely that more Syrian people will be homeless and migrate to Europe and the US. As we know, no Western country has the capacity to take care of these people, so again, another humanitarian catastrophe has hit the world. 

Losing access to Syria and the Mediterranean has weakened Iran, which will look for other options. The danger has always been that Iran blocks the Strait of Hormuz, which would lock in 24% of global oil. The US could not stop this. It would lead to oil prices at least doubling or more and a major global depression. 

The UAE (United Arab Emirates), which includes Dubai, is right by the Strait of Hormuz. 

Personally, I have always been surprised that so many people move to and invest in Dubai, given the major geopolitical risk that this area carries.

The world is in a severe war cycle, which, at best, will include insoluble and intractable wars in the Middle East and Eastern Europe with both the US and Russia involved. And at worst, a nuclear war.

I was always of the opinion that the Ukrainian conflict is a war Russia is very unlikely to lose. And neither the US nor European NATO troops have sufficient resources to win a war with boots on the ground. 

Russian missiles are currently superior, but anything can happen in a nuclear conflict.

In a nuclear war, there is no winner, and that could be the end of the world, so it is not worth speculating about the outcome of such a war.

THE TRIUMPH OF DEATH

Peter Bruegel painted the “Triumph of Death” in 1562. 

Currently, the world, and especially the West, is on a path to geopolitical and economic destruction.

No one knows how this will end. Even if it takes years, the world is unlikely to be the same once these two cycles have run their course. 

I have already stated that the end of the current economic cycle will be devastating for the world but bearable relative to the worst outcome of the war cycle. 

I had a hope that Trump would settle the Ukrainian situation if the US Neocons didn’t manage to escalate it severely before January 20. 

However, the Middle East conflict, with Iran involved, makes the situation much more complex, even with Trump’s best intentions. 

I always believe in finding solutions, but it is hard to be optimistic when the two Cycles of Evil prevail so strongly. 

At least anyone who has savings should take action to protect these against the coming implosion of financial assets. 

MARKETS

Stocks in the US are massively overvalued. 

The Buffett Indicator, US Stocks to GDP, is at 208%, an all-time high.

Just a normal correction would be a 50% to 75% fall.

The Price Earnings Ratio of Nasdaq stocks is 49X. 

A decline of at least 80%, like in the early 2000s, is likely. 

Obviously, bubbles can always grow bigger before they implode. 

However, the risk of a market collapse sometime in the next few months is extremely high.

Inflation will rise rapidly, as will interest rates, driven by money printing. 

The US 10-year treasury will greatly exceed 10%, as in the 1970s. 

WEALTH PRESERVATION 

Finally, gold will continue to reflect the destruction of the dollar and most currencies. 

Gold in US dollars is up 10X in this century. It is likely to rise by multiples from here as money dies. I explain why in this article: THE CASE FOR GOLD IS INCONTROVERTIBLE.

Gold must be held in physical form and outside the financial system with direct access to your gold. And preferably in a safe jurisdiction outside your country of residence. 

Finally, especially in periods of crisis, helping others and having a close circle of family and friends is more important than all the gold in the world. 

Tyler Durden Thu, 12/12/2024 - 21:45

A New Chapter Of The Bible Was Found Hidden Inside 1,750-Year-Old Text

A New Chapter Of The Bible Was Found Hidden Inside 1,750-Year-Old Text

Via The Mind Unleashed,

Hidden for centuries, a forgotten chapter of the Bible has emerged from the shadows of history. Researchers, armed with ultraviolet light and meticulous scholarship, have uncovered a 1,750-year-old text that offers a fresh glimpse into the evolving nature of scripture. This find isn’t just a historical curiosity; it’s a profound insight into how faith and tradition were shaped in early Christianity.

Preserved in an ancient Syriac manuscript, the chapter challenges long-held assumptions about biblical texts and their seemingly static nature. With its subtle variations and expanded narrative, this rediscovery raises compelling questions: What does this mean for the modern understanding of faith? And how many more hidden chapters might still be waiting to be found?

Unearthing a Lost Piece of Biblical History

In a groundbreaking intersection of technology and ancient history, scholars have uncovered a hidden chapter of the Bible within a 1,750-year-old Syriac manuscript preserved in the Vatican Library. Using ultraviolet (UV) light, researchers revealed traces of erased writing—a palimpsest—buried beneath layers of overwritten text. This painstaking process illuminated an earlier version of scripture, lost to time but now reintroduced to the world.

The manuscript, part of the Syriac translations of the Bible, is more than just a relic. It represents a key moment in Christianity’s history, when scribes worked tirelessly to preserve scripture under challenging conditions. Early Christians relied on Syriac texts to disseminate their teachings across cultural and linguistic boundaries, making this find a window into their lived experiences.

What makes this discovery especially remarkable is its collaborative nature. Historians, linguists, and scientists pooled their expertise to decode the faded script, each stroke of ink offering clues to a story untold for nearly two millennia. This isn’t just a triumph for biblical studies; it’s a testament to the enduring power of curiosity and innovation to uncover humanity’s shared past.

The Hidden Chapter: What We Know So Far

The newly unveiled chapter offers an expanded version of Matthew 12, a passage where Jesus and his disciples are criticized for picking grain on the Sabbath. In this version, subtle textual variations bring fresh theological nuances to light, emphasizing compassion and mercy over rigid observance of religious laws. While the core message aligns with established teachings, these differences hint at the dynamic and adaptive nature of early Christian scripture.

Written in ancient Syriac, one of the earliest languages used to transmit biblical texts, the chapter provides a rare glimpse into Christianity’s early cultural diversity. Syriac was instrumental in spreading scripture beyond its Jewish origins, tailoring messages to resonate with varied linguistic and cultural communities. This adaptation reflects the pragmatic approach of early Christians, who shaped their sacred texts to meet the needs of a rapidly growing faith.

What’s particularly striking is the role of early scribes. Far from being passive transcribers, they actively engaged with the material, reinterpreting and preserving it in ways that reflected their own spiritual and societal realities. This hidden chapter, with its emphasis on mercy, reveals a faith not rigidly bound to dogma but alive with reinterpretation and evolution—a window into the beliefs and priorities of communities navigating the complexities of their time.

The Technology That Unveiled the Forgotten Chapter

It’s hard to believe that something written almost 2,000 years ago could still be hiding in plain sight. But that’s exactly what happened here. Using ultraviolet light, researchers managed to reveal a forgotten chapter of the Bible, hidden beneath layers of overwritten text on an ancient manuscript. It’s like uncovering a secret message written centuries ago, invisible to the naked eye but waiting to be found.

The process wasn’t exactly a walk in the park. Think about it—this manuscript is old, fragile, and irreplaceable. Every move had to be precise, every scan done with the utmost care. Months of work went into piecing together faint traces of erased ink, with experts from all over—historians, linguists, scientists—working side by side. It’s amazing to think that this discovery wouldn’t have been possible even a few decades ago. The tools they used, like UV imaging, are giving us new ways to see the past in ways we never thought possible.

But here’s what really gets you thinking—what else is out there? If something as groundbreaking as a hidden chapter of the Bible can be uncovered, what other secrets might still be lying in wait? This is more than a cool tech story; it’s a reminder that history always has more to give, as long as we keep asking the right questions.

A Manuscript’s Journey Through Time

Think about this for a second: early Christians lived in a world where their beliefs could literally get them killed. Their sacred texts weren’t just important—they were lifelines, hidden and protected at all costs. That’s the world this 1,750-year-old Syriac manuscript comes from. Imagine scribes painstakingly copying and preserving these words, knowing the risks they faced if they were caught.

Back then, parchment wasn’t exactly easy to come by. It was expensive, rare, and, honestly, every bit as valuable as the words written on it. To make the most of it, scribes would scrape off old texts and reuse the material—creating what we now call palimpsests. It’s kind of wild to think that their recycling efforts accidentally preserved traces of history that they probably thought were gone for good.

Here’s another fascinating detail: this manuscript is written in Syriac. It’s one of the earliest languages used to spread Christianity and shows how the faith started to move beyond its Jewish roots. Syriac wasn’t just a language—it was a tool that helped Christianity adapt and grow, reaching new communities and cultures. That’s what makes this discovery so powerful. It’s not just about words on a page; it’s about the lengths people went to protect and share their beliefs.

And now, centuries later, we’re uncovering their story. You can almost picture the hands that wrote and rewrote this text, working in secret, determined to pass on what they believed mattered most. It’s a humbling reminder of just how much history can hide beneath the surface—literally—and how much these ancient voices still have to say.

What Scholars Are Saying: A New Lens on Scripture

This hidden chapter of the Bible has sparked lively debates among scholars. Many see it as a fascinating window into how early Christian communities understood and adapted scripture. The chapter’s emphasis on mercy over strict adherence to religious laws aligns with Jesus’ teachings but adds a fresh perspective to familiar passages. This nuance suggests early Christians may have tailored scripture to address the unique challenges of their time.

At the heart of the debate is the question of why this chapter was erased. Some scholars suggest it might have been excluded as church leaders worked to formalize the biblical canon, streamlining texts to unify doctrine. Others argue that its omission could simply reflect the practical realities of the time, with scribes overwriting older texts due to the scarcity of parchment. Whatever the reason, the discovery underscores the dynamic and evolving nature of early Christianity.

Ultimately, this find is about more than one chapter. It’s a reminder that the Bible, far from being a static document, was shaped over centuries by human hands and decisions. For scholars and believers alike, the chapter offers a chance to reexamine the past while raising new questions about the stories still waiting to be uncovered.

Hidden Truths, Endless Possibilities

The discovery of this hidden Bible chapter is more than a historical footnote—it’s a vivid reminder of how much the past still has to teach us. From the resilience of early Christian communities to the evolving nature of scripture itself, this find opens a window into a world where faith and history were deeply intertwined. It also shows how modern technology can breathe life into ancient artifacts, revealing secrets thought lost to time.

But this is likely just the beginning. Who knows what other forgotten chapters, erased writings, or hidden narratives are still waiting to be uncovered? Each discovery invites us to ask new questions, challenge old assumptions, and deepen our understanding of the stories that have shaped human history. Whether it’s faith, curiosity, or a little of both driving the search, one thing is certain—history still has plenty of mysteries left to share.

Tyler Durden Thu, 12/12/2024 - 20:05

Marc Andreessen Gives Insider Peek At DOGE Decisions, Helping Trump Pick The Next Administration

Marc Andreessen Gives Insider Peek At DOGE Decisions, Helping Trump Pick The Next Administration

Billionaire venture capitalist Marc Andreessen gave a wide-ranging interview to Free Press’s Bari Weiss, confirming his involvement with the Department of Government Efficiency (DOGE) and sharing behind-the-scenes insights on working with President-elect Donald Trump. Andreessen discussed his role in assisting Trump with assembling the next administration and provided a glimpse into what it’s like to spend time with the incoming commander-in-chief. During the two-hour conversation, Andreessen also revisited his experience with Biden administration officials, claiming the government expressed the orwellian desire to take "complete control" over AI development in the United States. 

I’m an unpaid volunteer,” Andreessen said when asked by Weiss about his reported involvement. A recent report from The Washington Post revealed that Andreessen, along with fellow Silicon Valley titans Uber co-founder Travis Kalanick and Palantir co-founder Joe Lonsdale, is contributing to the ambitious program. Andreessen outlined DOGE’s two chief objectives: slashing spending and reducing regulations.

“There's basically two big parts to it,” Andreessen explained. “One is they're going to do a top-to-bottom review of government spending, and they're going to cut as much cost as they possibly can. They have a whole theory and strategy on that.”

“In conjunction with that and related to it, they're going to do the same thing for regulations,” the billionaire continued. “They're going to do a top-to-bottom review of the regulatory—what they call the regulatory state or the administrative state.”

The connective tissue there, that they don't talk about in public, is actually quite important. A lot of the reaction of the Doge from institutional Washington is like, well, that's impossible, you can't do that; there are all these laws, statutes, and regulations,” he added.

Andreessen, along with his A16z co-founder Ben Horowitz, endorsed Trump during the final stretch of the 2024 election. Since Trump’s victory, Andreessen revealed to Weiss that he has spent a great day of time at Mar-a-Lago and the Palm Beach area, assisting the 47th leader of the free world with assembling his administration.

While Andreessen said he has spent “maybe half [his] time” at Mar-a-Lago since the election, he is quick to clarify his position:

"I’m not claiming to be in the middle of all the decision-making, but I’ve been trying to help in as many ways as I can,” the tech titan told Weiss. Andreessen explained that his contributions focus on areas where his expertise aligns with Trump’s agenda, including tech policy, business, and economic development. “When I talk about these things, it’s around, as I said, tech policy, business, economics, and then, you know, the health of the country, the success of the country,” he noted.

Andreessen shared his observations of Trump’s warm personal approach, highlighting qualities that he believes are often overlooked by his Democrat critics.

Everybody says this who meets with him, but he’s an incredible host,” Andreessen remarked. “For however people think, whatever, he’s an incredible host. He runs his own private worlds.”

What stood out most to Andreessen was Trump’s ability to connect with people from all walks of life.

He treats everybody the same and talks to everybody,” Andreessen said. “He will happily talk to distinguished visitors about who the Vice President should be, and then he’ll ask the caddy.”

Reflecting on his involvement in the transition process, Andreessen noted the exceptional caliber of candidates he encountered. “The caliber of a lot of the people that I’ve met has been very high,” he said, adding that recent appointments, particularly at the next level down in staff positions, have included “very impressive people.”

Addressing concerns about whether qualified individuals might hesitate to join a Trump administration due to the controversies surrounding his previous term, Andreessen said he has observed the opposite trend: “I think the flow of qualified people from outside the system now is actually much stronger.”

Yet another mainstream media narrative busted.

Addressing also reiterated that his support for Trump stemmed from a series of “horrifying” meeting in which Biden officials expressed plans to control AI.

"They said, look, AI is a technology basically that the government is going to completely control," Andreessen revealed. The officials explicitly discouraged the idea of entrepreneurial ventures in AI, stating, “Don’t start, don’t do AI startups... it’s not something that we’re going to allow to happen.”

According to the billionaire, the officials conveyed that AI innovation would be concentrated among “two or three big companies... working closely with the government,” with startups effectively barred from the space. “We’re going to basically wrap them in a government cocoon, protect them from competition, control them, and dictate what they do,” Andreessen paraphrased, highlighting the stark divergence from the open-market approach that has historically driven tech innovation.

Tyler Durden Thu, 12/12/2024 - 19:40

Operators Of LAX Restaurants Face A $30 Hourly Wage

Operators Of LAX Restaurants Face A $30 Hourly Wage

By Peter Romeo of Restaurant Business,

The City Council of Los Angeles is scheduled to consider a proposal on Dec. 11 to raise the minimum wage for workers employed in the restaurants at Los Angeles International Airport (LAX) to $30 an hour.

The initiative slated for consideration calls for increasing the minimum wage to $25 an hour no later than six months after traffic in the airport resumes the levels of 2019, or before air travel dropped precipitously because of the pandemic. That threshold is expected to be reached possibly this year, meaning the increase would come in 2025.

The minimum would then rise by $1 every July until the pay floor reaches $30 an hour.

The minimum permissible wage for the workers is currently $19.25.

Hotel employees covered by a collective bargaining agreement hammered out with the city during the first quarter of 2024 would also be eligible for the raises. The trigger for those workers would be hitting the occupancy rate enjoyed by city hotels in the pre-pandemic days of 2019.

Workers in several dozen hotels would be affected.

The Airport Restaurant & Retail Association, a trade group for airport concessionaires, called the proposal “a bridge too far.” It noted that the proposed increases would amount to a 56% wage hike over a four-year period for the eligible employees.

According to the association, the wages of airport-restaurant employees have been soaring. The lift is coming in part because of the additional challenges someone working in an airport restaurant is forced to address. For instance, their trip to work can easily take 45 minutes because they have to traverse the airport and contend with security screenings. Someone working in a streetside facility may need only 10 minutes to get to the job, the group stressed.

In addition, nearly 70% of airport concession workers are covered by collective bargaining agreements.

The proposal to be considered by the City Council is the result of what labor authorities called segmental bargaining, or negotiating a labor contract across a group of employees doing similar work across a multitude of employers.

Segmental bargaining came to the restaurant industry in April with the creation of the Fast Food Council, a nine-person panel empowered by the state to set wages for fast-food employees who work for a restaurant with at least 59 sister branches nationwide. The council consists of four workers’ representatives and four employers, with a neutral government worker wielding a ninth and potentially tie-breaking vote.

Simultaneous with the creation of the council, the minimum wage for covered fast-food workers rose to $20 an hour on April 1, from a previous floor of $16.

Tyler Durden Thu, 12/12/2024 - 19:15

"Polar Vortex" Is Upon Us: Arctic Outbreaks To Round Out December

"Polar Vortex" Is Upon Us: Arctic Outbreaks To Round Out December

It's almost that time of year when a polar vortex split occurs, displacing cold Arctic air from the Earth's North Pole into Canada and spilling into the Lower 48. 

Data from Bloomberg shows that mentions of "polar vortex" in corporate media typically begin to surge in late December or the first half of January, signaling that the countdown has begun. 

On Wednesday, private weather forecaster BAMWX pushed out new weather models on X, showing confidence is growing for a polar vortex split to occur for the Lower 48. 

"The stage is set for Arctic outbreaks to round out December and kick start the new year!" BAMWX wrote on X. 

BAMWX said, "More favorable trends for stronger cold fronts in week 2. I don't see any signs of a consistent torch in the eastern US. Ensembles cannot resolve the +TNH & +PNA pattern right now making them consistently too warm late week 2." 

Michael Clark, chief meteorologist for BAMWX, was confident about the incoming polar vortex.

Clark also sees a more active precipitation pattern for the eastern half of the US. 

"The persistence in the PNA and the TPV (500mb tropospheric polar vortex location is the reason we believe the storms can easily pull down the Arctic air behind them," BAMWX said. 

The eastern half of the US appears to be setting up for a cold Christmas

And possibly a white one...

"Both GFS and ECMWF AI model data hinting at a bigger storm threat ~22nd of Dec," BAMWX wrote in a forecast.

Here's more from Clark in a video titled "Stage set for ARCTIC OUTBREAKS to start 2025" ... 

Tyler Durden Thu, 12/12/2024 - 18:50

Russia Dodged A Bullet By Wisely Choosing Not To Ally With The Now-Defeated Resistance Axis

Russia Dodged A Bullet By Wisely Choosing Not To Ally With The Now-Defeated Resistance Axis

Authored by Andrew Korybko via substack,

Putin made the right choice, which was always driven by his rational calculation of what was in Russia’s objective interests as a state, not due to “Zionist influence” like some in the Alt-Media Community now ridiculously claim to defame him after being mad that he didn’t lift a finger to save the Resistance.

The Iranian-led Resistance Axis has been defeated by Israel. Hamas’ terrorist attack on 7 October 2023 prompted Israel’s collective punishment of the Palestinians in Gaza, which set into motion a series of conflicts that expanded to Lebanon and Syria. Israel has also bombed Yemen and Iran. Hamas’ and Hezbollah’s leaderships were destroyed, leading to a ceasefire in Lebanon, while the Assad government was just overthrown by a Turkish-backed terrorist blitz that severed Iran’s military logistics to Hezbollah.

These outcomes were already surprising enough for those who believed the late Nasrallah’s claim that “Israel is weaker than a spider web”, but many were shocked that they occurred without Russia lifting a finger to save the Resistance, with whom they thought that it had allied against Israel long ago. That second-mentioned false notion will go down in infamy as one of the most successful psy-ops ever conducted against the Alt-Media Community (AMC), and ironically enough, by its own top influencers.

It was explained in early October “Why False Perceptions About Russian Policy Towards Israel Continue To Proliferate”, which readers should review for more detail, but which can be summarized as top AMC influencers telling their audience what they thought they wanted to hear for self-interested reasons. These include generating clout, pushing their ideology, and/or soliciting donations from well-intentioned but naïve members of their audience depending on the personality involved.

The preceding analysis also lists five related ones about Russian policy towards Israel since the start of the West Asian Wars, including this one “Clarifying Lavrov’s Comparison Of The Latest Israeli-Hamas War To Russia’s Special Operation”, which itself links to several dozen others. All of them also reference this May 2018 report about “President Putin On Israel: Quotes From The Kremlin Website (2000-2018)”. All of these materials rely on official and authoritative Russian sources to arrive at their conclusions.

They prove that Putin is a proud lifelong philo-Semite who never shared the Resistance’s unifying anti-Zionist ideology, instead always expressing very deep respect for Jews and the State of Israel. Accordingly, as the final decisionmaker on Russian foreign policy, he tasked his diplomats with balancing between Israel and the Resistance. To that end, Russia never took either’s side and always remained neutral in their disputes, including the West Asian Wars.

The most that he ever personally did was condemn Israel’s collective punishment of the Palestinians, but always in the same breath as condemning Hamas’ infamous terrorist attack on 7 October 2023. As for Russia, the most that it ever did was repeat the same rhetoric and occasionally condemn Israel’s strikes against the IRGC and Hezbollah in Syria, which Russia never interfered with. Not once did it try to deter or intercept them, retaliate afterwards, or give Syria the capabilities and authorization to do so either.

This was due to the deconfliction mechanism that Putin and Bibi agreed to in late September 2015 shortly before the Syrian operation. It was never confirmed for obvious diplomatic reasons, but these actions (or rather lack thereof) suggested that Putin believed that Iran’s anti-Israeli activities Syria posed a legitimate threat to Israel. For that reason, Russia always stood aside whenever Israel bombed Iran there, but Russia still sometimes complained due to Israel’s attacks formally violating international law.

It’s an objectively existing and easily verifiable fact that Russia’s opposition to Israel’s regional activities, be they in Gaza, Lebanon, Syria, Yemen, or Iran, always remained strictly confined to the political realm of official statements. Not once did Russia ever threaten to unilaterally sanction Israel, let alone even remotely hint at military action against it as punishment. Russia won’t even symbolically designate Israel as an “unfriendly state”, though that’s because it doesn’t abide by US sanctions and won’t arm Ukraine.

Therein lies another fact that most in the AMC were either unaware of or in denial about and it’s that Israel isn’t the US’ puppet otherwise it would have already done those two things long ago. It’s beyond the scope of the present piece to explain this, as well as why the Biden Administration has tried to destabilize and overthrow Bibi, but this analysis here dives into the details and cites related articles. The point is that Russian-Israeli ties remain cordial and these two are far from the foes that some thought.

It therefore never made sense to imagine that Putin, who considers himself to be the consummate pragmatist, would burn the bridge that he personally invested nearly a quarter-century of his time building with Bibi between their two nations. After all, Putin boasted in 2019 that “Russians and Israelis have ties of family and friendship. This is a true common family; I can say this without exaggeration. Almost 2 million Russian speakers live in Israel. We consider Israel a Russian-speaking country.”

He was speaking before the Keren Heyesod Foundation, one of the world’s oldest Zionist lobbying organizations, during its annual conference in Moscow that year. Whenever members of the AMC were confronted with these “politically inconvenient” facts from official and authoritative sources such as the Kremlin’s own website, they spun a “5D chess master plan” conspiracy theory alleging that he was just “psyching out the Zionists”. Top influencers also aggressively “canceled” anyone who brought this up.

The end result was that these false perceptions of Russian-Israeli relations as well as Putin’s own views towards this subject continued to proliferate unchallenged through the AMC, thus leading to the impression that they were secretly allied with Iran due to their allegedly shared anti-Zionist ideals. This notion became a matter of dogma for many in the AMC and correspondingly turned into an axiom of International Relations for them. Anyone who claimed otherwise was smeared as a “Zionist”.

It's now known after Russia didn’t lift a finger to save the Resistance that they were never actually allies. Some of those that still can’t accept that they’ve been lied to by trusted AMC influencers who duped them for self-interested reasons (clout, ideology, and/or soliciting donations) now speculate that Russia “betrayed” the Resistance and “sold out to the Zionists” even though Russia was never on either’s side. If they don’t soon shake off their cognitive dissonance, they’ll detach themselves further from reality.

In retrospect, Russia dodged a bullet by wisely choosing not to ally with the now-defeated Resistance Axis since it would have needlessly ruined its relations with Israel, the undisputable victor of the West Asian Wars.

Putin made the right choice, which was always driven by his rational calculation of what was in Russia’s objective interests as a state, not due to “Zionist influence” like some in the AMC now ridiculously claim to defame him after being mad that he didn’t lift a finger to save the Resistance.

The takeaways from this are several: 1) Putin and his representatives don’t play “5D chess”, they always say what they truly mean; 2) Russia isn’t anti-Israel nor anti-Zionist, but it also isn’t anti-Iran nor anti-Resistance either; 3) the AMC is full of charlatans who, for self-interested reasons, tell their audience whatever they think they want to hear; 4) their audience should thus hold them to account for lying about Russian-Israeli and Russian-Resistance relations; 5) and the AMC requires urgent reform.

Tyler Durden Thu, 12/12/2024 - 17:00

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