The weekend is here! Pour yourself a mug of  coffee, grab a seat outside, and get ready for our longer-form weekend reads:

• We might be closer to changing course on climate change than we realized: Greenhouse gas emissions might have already peaked. Now they need to fall — fast. (Vox)

• Tesla Is Not the Next Ford. It’s the Next Con Ed. Elon Musk’s EV empire is crumbling. Of late, Tesla’s cars have come to seem a bit hazardous. Their self-driving features have been linked to hundreds of accidents and more than a dozen deaths. Then, earlier this month, the company recalled its entire fleet of Cybertrucks. (The Atlantic) see also Tesla’s in its flop era: The company’s sales are falling, its stock is dropping, and even its most ardent supporters are stressed about where it’s all heading. (The Verge)

• It Introduced Ozempic to the World. Now It Must Remake Itself. Novo Nordisk’s factories work nonstop turning out Ozempic and Wegovy, its blockbuster weight-loss drugs, but the Danish company has far bigger ambitions. (New York Times)

• Fidelity Reminds ETF Industry It Doesn’t Have To Care: Vanguard: Plow any money made back into making the funds bigger (cheaper) and better; Schwab: Make money for shareholders the way most public companies do: generate bottom line profits (the business), and increase multiples (the brand and growth story); Fidelity: Secure the Bag for Abby Johnson and other private shareholders. (Echo Beach)

• Jerry Seinfeld Says Movies Are Over. Here’s Why He Made One Anyway: The billionaire comedian could be doing anything with his time and talent, so why did he direct a movie about Pop-Tarts? In a candid conversation, Seinfeld explains all that—as well as his role in making that instantly-legendary Curb finale, and his sense that people misunderstood his own show’s notorious ending. (GQ)

• Ant geopolitics: Over the past four centuries quadrillions of ants have created a strange and turbulent global society that shadows our own. (Aeon)

• 27 Takes On What It Means To Be a Serious Person: What do we mean when we call somebody “serious” or “unserious”? Let me say, right off the bat, that I don’t think there’s a definitive answer to this. Seriousness is something we recognise in people, or feel we recognise, without being able to fully articulate (The Ruffian) see also Do you have an inner monologue? Here’s what it reveals about you. While experts disagree on how common self-talk really is, they wholeheartedly agree that it’s a valuable tool for self-discovery. (Nat Geo)

• What Kind of a Superpower Is India Becoming? The 2024 Indian general election is already underway, and the popular and controversial Narendra Modi looks to be the favorite. How is India changing under Modi? (The Ringer)

• How the New York Times became the White House’s least favorite paper: The Petty Feud Between the NYT and the White House Biden’s people think they’re “entitled.” The Times says “they’re not being realistic.” (Politico)

• Physicists Finally Know How the Strong Force Gets Its Strength: New discoveries demystify the bizarre force that binds atomic nuclei together. (Scientific American)

Be sure to check out our Masters in Business this week with  Dr. Ed Yardeni, President of Yardeni Research and former Chief Investment Strategist at Deutsche Bank, Cheif Economist at Prudential, and researcher at the Federal Reserve Bank of New York. His most recent book is “Predicting the Markets: A Professional Autobiography.”

 

The evolution of equity markets by country/cap

Source: UBS

Sign up for our reads-only mailing list here.

~~~

Still on book leave . . .  but I am past the midway point and making good progress!

 

The post 10 Weekend Reads appeared first on The Big Picture.

California's New Minimum Wage: A Cure That Exacerbates The Sickness

Via SchiffGold.com,

The solution to a problem shouldn’t make the problem worse.

But apparently, California’s policy makers missed that memo.

On April 1st, the state instituted a $20 minimum wage for fast food workers, the highest in the US. With California’s absurdly high cost of living, the policy appeared to make life more manageable for low-income residents. Unfortunately, as the adage goes, “If it sounds too good to be true, it probably is.” California’s new minimum wage is poised to hurt the same fast-food workers it aims to help.

The Economic Problem of a Minimum Wage

The counterproductivity of a minimum wage is demonstrated by a simple analysis of the labor market. Companies “purchase” labor from workers through a wage. The more value a worker adds to a company, the more they will be paid. If employers are allowed to set wages freely, and the labor market is competitive, workers can expect to be paid close to their value added to the company.

A minimum wage hijacks this process. If a worker is worth $15 an hour to an employer, but a $20 minimum wage is introduced, the company will no longer hire the worker, and both parties are harmed. A $20 wage floor means that workers must at least add that much value to the company. For many laborers, this means saying goodbye to their industry and hello to unemployment.

The Effects of California’s Minimum Wage

The ripple effects of California’s $20 minimum wage have proved these dismal predictions all too true. Several chains, including Pizza Hut and Starbucks, have laid off workers in response to the wage increase. Michaela Mendelsohn, the CEO of El Pollo Loco, claimed the company would have to reduce employee hours due to increased labor costs. McDonald’s employees are likewise seeing their hours substantially reduced. In the tight margins of the fast-food industry, where even a small increase in the price of labor can destabilize a production chain, the effects of the wage hike have been exacerbated.

Fast-food workers are particularly susceptible to layoffs because of the rise of automation within the industry. Automation creates a simple alternative for companies struggling to meet the wage requirement. Many fast-food restaurants have already implemented mobile ordering stations, and if labor costs continue to rise, the incentive to further automate will increase. Restaurants around the world have already introduced machines to replace waiters, cashiers, and cooks.

A higher wage also increases the risk of hiring new, untested workers. In service industries, such as fast food, it can be difficult to distinguish the productivity of individual workers. It can take a while to find the weak link at the root of a location’s unproductivity, and this delay equals lost revenue. While an untested applicant may potentially boost productivity, a heightened minimum wage increases the risk of giving that worker a chance.

Proponents of the new minimum wage argue that food chains will absorb the wage increase by raising prices. Some companies, such as Chipotle and Jack in the Box, have already raised their California prices in response to the new policy. However, this is not a concrete solution. Any price increase will necessarily decrease consumer demand, which could harm profits further. A step too far and the workers’ already dire plight will be exacerbated.

If California’s economic and political conditions continue to worsen, many franchises might simply leave the state. While California has a massive potential market, if labor costs become prohibitively high, chains could simply focus their resources on more economically-friendly states. Leading the way are MOD Pizza and Starbucks, who respectively closed five and seven of their California locations in April.

The Minimum Wage: A Cure that Exacerbates the Sickness

The ethos of the minimum wage is to support the poor and lessen wealth inequality. Social class discrepancy is not a trivial issue, as a lack of generational wealth constrains the opportunities of millions of Americans. Children of parents without college degrees are more likely to not obtain a degree themselves, and less educated workers are on average less productive than their educated counterparts. However, the minimum wage increases inequality by cutting off anyone who falls below a mandated productivity threshold. This means removing many of the underprivileged from the workforce altogether, causing families already hampered by societal constraints to see their opportunities shrink even further. It’s like a hospital diverting its care from its sickest patients to pamper the healthy.

Interventionist policies usually sound good. Politicians love to swoon about how their measures will reduce inequality and to paint opponents as money-grubbers who don’t care about assisting the poor. The cold reality is that when the government institutes a sweeping economic reform, there will always be unintended consequences. In the case of the minimum wage, the “cure” exacerbates the sickness.

Tyler Durden Fri, 04/26/2024 - 21:40

Immunity For Me But Not For Thee

Authored by William Woodruff via The Epoch Times (emphasis ours),

Whether Presidential Immunity is a Good Thing or a Bad Thing Shouldn’t Depend Upon Party Affiliation

“Whether and if so to what extent does a former President enjoy presidential immunity from criminal prosecution for conduct alleged to involve official acts during his tenure in office?” That is the question the Supreme Court will answer when it hears oral argument in Trump v. U.S.  on April 25, 2024.

Legacy media and the ladies of “The View” nearly lost their collective minds when the Court agreed to hear Trump’s appeal of the D.C. Circuit’s decision denying him immunity for his actions surrounding the events of Jan. 6, 2021. However, even Jack Smith, the Special Counsel prosecuting the case, argued that it was of “imperative public importance” that the Court resolve the immunity question before trial.

But forget about Trump for the moment. The issue is bigger than Trump and his legal woes. As the partisan divide between the left and the right grows larger, there is a real risk that the criminalization of policy differences could raise our current state of “lawfare” to a new level.

Several retired four-star generals and admirals, as well as former cabinet officials, have filed an amicus brief with the Supreme Court arguing that granting immunity to former presidents for actions within the outer perimeter of their official duties would raise questions about the ability of the United States to peacefully transfer power from one administration to another, and thereby pose a grave risk to national security.

The retired officials’ brief also argues that granting immunity would undermine civilian control of the military and undermine trust and confidence in the military as an institution.

The “parade of horribles” in the retired officials’ brief assumes that a future president would instruct subordinate military officers to carry out illegal orders for which they, but not the president, would be criminally liable. The brief also suggests that an unrestrained incumbent would use the military to retain power and, thus, destabilize America’s diplomatic and military standing among nations.

Of course, none of the hypotheticals feared by the brief writers occurred in the case pending before the Court. Apparently, they are afraid not of Donald Trump but of some unidentified future president.

To analyze the pros and cons of immunity, however, there is no need to speculate about what some future president might do. We need only look at actual events from our recent history.

Situation #1

President Obama ordered a drone strike in Yemen to kill Anwar al-Awlaki, an American citizen and Islamic Imam critical of American foreign policy in the Middle East. Before releasing the drones that killed al-Awlaki and two others, the White House sought and received a Memorandum from the Department of Justice providing legal justification for the attack.

Several questions come to mind.  Should the memo from DoJ authorizing the killing of an American citizen abroad without judicial due process immunize President Obama for violating the federal criminal statute that imposes criminal penalties for the extra territorial killing of an American citizen?

Could a subsequent President, a member of the opposing political party, direct a new Attorney General to investigate whether the killing of the U.S. citizen by drone attack in Yemen violated federal criminal law? If an indictment is returned against the now former President for that killing, should President Obama be allowed to claim immunity or be forced to stand trial?

Situation #2

President Biden revoked many of President Trump’s Executive Orders addressing border security when he took office. He also halted construction of physical barriers intended to secure the southern border and stem the flow of illegal border crossings and the smuggling of dangerous drugs.

The number of illegal border crossings skyrocketed. Instead of remaining in Mexico until asylum claims were adjudicated, migrants were “paroled” into the interior of the United States and given a court date for their asylum claim years into the future.

The quantity of illegal drugs, and the deaths of American citizens from accidental drug overdoses smuggled across the southern border, escalated astronomically. Federal law imposes criminal penalties on those who enter the United States illegally. It also punishes conspiracies to violate federal law.

So, if the White House switches parties when President Biden leaves, should the new president’s Attorney General seek an indictment against Biden for conspiring with the Secretary of Homeland Security to violate U.S. immigration laws by facilitating the illegal entry of millions of migrants into the United States? Or should those policy choices be protected by a cloak of immunity?

Situation #3

Eager to deliver on a campaign promise, President Biden announced a policy to “forgive” billions of dollars in student loan debt. The Supreme Court struck down the President’s plan and held that Congress had not authorized the Executive to unilaterally forgive student loan debt.

Instead of seeking legislative authority, President Biden reworked his plan to rely upon a different statute for authority. Assume the courts dismissed lawsuits challenging Biden’s “Plan B” because the plaintiffs lacked standing to sue. “Plan B” went forward and billions of dollars in federal student loans became “grants” instead of loans that had to be repaid.

The federal Anti-deficiency Act imposes criminal penalties on anyone who authorizes the expenditure of federal funds without a valid congressional appropriation. When President Biden leaves office, can he be indicted and tried because his “Plan B” loan scheme violated federal law?

Presidential Immunity Analysis

Each of the foregoing situations illustrates how  a former President could be subject to indictment for actions taken within the outer perimeter of his official duties as President. Never happen, you say? Surely, no one would try to force these facts into violations of existing law. But Alvin Bragg, Fani Willis, and Jack Smith have all engaged in creative lawyering to bring novel criminal charges against Trump. Apparently, some see creative lawyering as a feature and not a bug in our legal system.

While the former Presidents have substantive defenses to the charges and the novel theories advanced in the indictments may be rejected by the courts or nullified by a jury, should the former presidents and the country be put through the spectacle of a criminal trial?

One of the major attributes of immunity is that it avoids the trial in the first place. Instead of placing one’s fate in the hands of a jury and hoping they will accept one or more defenses or justifications for the alleged violations, immunity prevents the trial at the outset. In other words, if the process is the punishment, immunity avoids the process.

Presidential immunity for actions within the outer perimeter of official duties allows a president to make difficult policy and operational decisions without concern for his personal liberty once he leaves office. It also eliminates the temptation to exact a tit for tat when the next election goes to the opposition party.

On the flip side, the existence of presidential immunity may provide unwarranted protection for the actions and decisions of a president who does not really have the best interests of the country at heart. But the Constitution provides two significant checks on that unseemly circumstance: impeachment and the ballot box. Furthermore, the Constitution specifically provides that upon conviction by the Senate in an impeachment trial the person impeached “shall nevertheless be liable and subject to indictment, trial, judgment and punishment, according to law.”

It is tempting to favor or disfavor presidential immunity in criminal cases depending upon the political or personal like or dislike one may have for the indicted former President. Republicans get immunity but Democrats don’t; or vice versa. But if we are to be a nation of laws every former president should be entitled to presidential immunity for alleged criminal acts committed within the outer perimeter of official duties, or no former President should be so immune.

The issue before the Supreme Court is one of first impression. While immunity has been litigated in the context of civil claims, no former President has been indicted for criminal acts while in office, until now. In an ideal world, the answer to the question presented in Trump v. United States would remain nothing more than an interesting topic of discussion among law professors.

But if the last seven or eight years have proved anything it is that we are not living in an ideal world.

William A. Woodruff is a retired Army lawyer who, as Chief of the Army Litigation Division, was responsible for defending Army policies, programs, and operations in federal courts around the country. He retired from active duty in 1992 and taught law for 25 years at Campbell University School of Law in North Carolina.

Tyler Durden Fri, 04/26/2024 - 20:20

Why You Can't Afford Most Hotels In New York City

Authored by Fred Roeder via RealClearMarkets,

On a Friday night in March 2011, I stayed at an upscale W Hotel on Lexington Avenue in New York City for $124. That hotel later became The Maxwell, but sadly it didn’t survive the pandemic and is now permanently closed. Today the average hotel stay in that same neighborhood costs between $400 and $500 on a Friday night. The surge in hotel prices, particularly for upmarket accommodations, has caught the attention of travelers and investors worldwide. What led to this spike in hotel rates post-pandemic?

Several factors have been at play for the hospitality industry since COVID entered the rearview, resulting in higher prices for travelers.

Supply and Competition

Competition within hospitality plays a crucial role in determining hotel prices. While it might appear that there's no shortage of lodging options for travelers, the regulatory crackdown on platforms like Airbnb in big cities has redirected travelers back into the arms of traditional hotels, thereby increasing demand. 

As the Consumer Choice Center has pointed out, 80 percent of properties were already delisted from Airbnb by October 2023 thanks to New York City’s stringent new short-term rental policies. Because of the new restrictions on temporary rentals, which state that only two paying guests at most can stay for up to 30 days under certain conditions (unobstructed access to the whole residence, short-term registration, owner present on site), many families have no choice but to look for a hotel room during their NYC stay. 

Not to mention the massive buying up of hotel room blocks by the city in order to house newly arrived migrant populations. This warps the market for hotel rooms in profound ways. NYC has at least 140 active contracts with city hotels to fill all their vacant rooms, normally valued around $110 per night, but marked up by 73 percent to $190 for a room. Vacancies mean lower prices, but if surrounding inns are full, hotel prices rise for consumers. 

This arrangement may not be what hoteliers had in mind for their business, but it has proven highly lucrative for the properties cooperating with the city in these contracts. 

Closures of smaller hotels along with industry consolidation reduce the number of options for consumers, which empowers larger hotel chains to raise prices. Moreover, high interest rates on financing discourage the construction of new hotels, leading to an even more constrained supply of rooms. All the while, prices creep even higher. 

Consolidated hotel groups have found innovative ways to manage yields and hence increase revenue. This would explain higher average daily rates despite similar or even lower occupancy rates for NYC hotels pre-pandemic.

Traveler’s Tastes Change 

Higher prices are also related to consumer preferences, which have evolved significantly in recent years. The pandemic prompted a shift towards safer and more luxurious options, with travelers prioritizing enhanced safety measures and amenities. This shift, coupled with pent-up demand from periods of lockdown, has resulted in a willingness among travelers to pay a premium for upmarket hotels. 

Consumers also tend to book closer to their travel dates and are proving reluctant to commit far in advance. A few years of uncertainty around travel has created a more cautious average traveler. On top of that, the normalization of remote work has blurred the lines between business and leisure travel, leading to longer average stays. 

People are taking personal vacations and then staying there longer while they transition back into work mode.

Supply Chains and Labor

Amidst all these trends, operational costs rise with minimum wage hikes, labor shortages, crunched supply chains overseas, and ever-increasing taxes in America’s largest cities. The labor shortfall is not insignificant and leaves hotels struggling to meet the high demand for rooms. The costs are likely being passed on to consumers in the form of higher prices. 

It’s also very possible that hotels are eager to recoup losses incurred during the pandemic period, driving them to maximize revenue through price adjustments as demand rebounds in major travel markets. 

It’s a perfect storm of industry trends, regulatory pressures on competitors, and consumer behavior driving up the average price of a hotel stay in NYC and other large cities. Is there anything that can be done? 

Ideally, as prices rise, consumers will see a new wave of entrepreneurial competition offering market solutions and testing out new models for lodging travelers. For the sake of all our wallets, let’s hope that happens sooner rather than later.

Tyler Durden Fri, 04/26/2024 - 19:40

Mainstream Media Misrepresenting Crime Statistics In Order To Protect Biden

Authored by Eric Lundrum via American Greatness,

With the November election less than 7 months away, mainstream media outlets are now choosing to misrepresent the current state of crime in the United States, claiming that crime is declining without providing full context or key details.

As the Daily Caller reports, there are two ways in which the federal government measures crime in the United States: The Bureau of Justice Statistics’ (BJS) National Crime Victimization Survey (NCVS) and the Federal Bureau of Investigation’s (FBI) Uniform Crime Reporting (UCR).

Whereas the NCVS asks roughly 240,000 Americans whether or not they’ve been a victim of crime in the last year, the UCR focuses on crimes that have been reported to police within the last year and shared with the FBI.

While more people are reporting to the BJS that they have been the victims of crime, the FBI is reporting fewer crimes through the UCR.

The UCR claims that violent crime dropped by 2% from 2021 to 2022, while the NCVS shows the exact opposite, reporting that the number of victims of violent crime increased by a staggering 42.4% from 2021 to 2022; this constitutes a rise from 16.5 victims per 1,000 people to 23.5 victims per 1,000.

Nevertheless, many mainstream media outlets such as CBS, NBC, PBS, NPR, Reuters, and The Hill have all turned to the FBI’s data to claim, falsely, that crime is on the decline. All such reports have failed to mention the crucial data from the NCVS.

Even Joe Biden himself has turned to deliberately misrepresenting the facts by relying solely on the FBI’s data.

“This week, the FBI released data showing that crime declined across nearly every category in 2023,” said Biden recently.

“Thanks to the American Rescue Plan, which every Republican in Congress voted against, we made the largest-ever federal investment in fighting and preventing crime at any time in our history.”

This directly contradicts broad public sentiment in the United States, with a Gallup poll in December finding that 77% of Americans believe crime is getting worse.

Tyler Durden Fri, 04/26/2024 - 19:15

Bank Failures Begin Again: Philly's Republic First Seized By FDIC

Who could have seen that coming? (here, here, here, and most detailed here)

March will be lit:

1. Reverse repo ends
2. BTFP expires
3. Fed cuts (allegedly)
4. QT ends (allegedly)

— zerohedge (@zerohedge) January 8, 2024

Admittedly, we were a couple of weeks off, but trouble has been brewing in the banking sector and tonight - after the close - we get the first bank failure of the year.

The FDIC just seized the troubled Philadelphia bank, Republic First Bancorp and and struck an agreement for the lender’s deposits and the majority of its assets to be bought by Fulton Bank.

Republic Bank had about $6 billion of assets and $4 billion of deposits at the end of January, according to the FDIC (considerably smaller than the $100-200BN assets with SVB and Signature).

The FDIC estimated the failure will cost the deposit insurance fund $667 million.

As The Wall Street Journal reports, Republic First had for months struggled to stay afloat.

Around half of its deposits were uninsured at the end of 2023, according to FDIC data. 

Its total equity, or assets minus liabilities, was $96 million at the end of 2023, according to FDIC filings.

That excluded $262 million of unrealized losses on bonds that it labeled “held to maturity,” which means the losses hadn’t counted on its balance sheet.

Its stock, which was delisted from Nasdaq in August, had been near zero.

Republic Bank’s 32 branches across New Jersey, Pennsylvania and New York will reopen as branches of Fulton Bank on Saturday, according to a statement from the FDIC.

Depositors of Republic Bank will become depositors of Williamsport, Pennsylvania-based Fulton Bank, the regulator said.

You should not be surprised given that rates are higher now than they were at the start of the SVB crisis - which means, unless banks have hedged hard or dumped their bonds at a loss, they are even more underwater...

U.S. Banks finished the year with almost $400 billion of unrealized losses on held-to-maturity assets. The assumption is this wouldn't be a problem because the Fed would cut A LOT this year but what if that doesn't happen? pic.twitter.com/fsfMCisEd3

— Barchart (@Barchart) April 25, 2024

Add to this the fact that last week - seasonally-adjusted for tax-season - US banks saw the largest deposit outflows since 9/11 (yes, that 9/11)...

...and, as we showed earlier, absent the $126BN outstanding in The Fed's BTFP bailout fund (which is now terminated and slowly running down as the term loans mature)...

...the banking crisis is back and now the question is "who's next?"

Tyler Durden Fri, 04/26/2024 - 18:45

Biden Holds Off On Sanctioning IDF Unit In Apparent Reversal 

Via The Cradle

The government of US President Joe Biden has decided against imposing sanctions on Israeli army units responsible for human rights violations against Palestinians, despite initial plans to do so. 

ABC News reported on Friday that a government assessment determined that three battalions in the Israeli army committed “gross human rights violations” against Palestinians in the occupied West Bank “but will remain eligible for US military aid regardless because of steps Israel says it’s taking to address the problem.” 

Image source: NY Times

The assessment, which has not been made public, was outlined in a letter written by US Secretary of State Anthony Blinken to House Speaker Mike Johnson, which the news network obtained. 

The rights violations committed by Israeli forces “will not delay the delivery of any US assistance and Israel will be able to receive the full amount appropriated by Congress.” Billions in US aid to Israel was approved by Biden just two days ago after passing in the Senate on Tuesday.

The violations in question were committed prior to October 7 and took place in the occupied West Bank. They include the execution of Palestinians by Israeli border police, as well as torture and rape during interrogation. 

None are related to Israel’s ongoing war in Gaza, which has killed tens of thousands of Palestinians, the majority of whom were women and children. 

Yet the decision is expected to frustrate many critics of the Biden administration who believe Washington has not done enough to hold Israel accountable for war crimes. Under the US Leahy Law, Washington should withhold military aid to states committing severe human rights abuses. Yet the law allows exceptions if measures are taken to punish those responsible. 

An informed source told ABC that Israel and the US have a “special agreement” that Washington must consult with Tel Aviv over any decision relating to foreign assistance. The source added that these consultations are ongoing. 

Blinken’s letter states that four of the Israeli army units have undergone “remediation” steps, meaning that those within the units that are responsible for the crimes have been internally held accountable. 

Israeli Prime Minister Benjamin Netanyahu said on April 21: “If anyone thinks they can impose sanctions on a unit of the IDF, I will fight it with all my strength.”

According to Hebrew news site Ynet, Israeli pressure on the US helped shape the decision not to impose sanctions on the units. “The reasonable estimate is that we will be able to convince the US not to impose these sanctions,” an Israeli official told the outlet. 

In addition to Netanyahu, opposition leaders Benny Gantz and Yair Lapid both called on the US not to proceed with the decision. Israeli Defense Minister Yoav Gallant reportedly promised Blinken that “steps” would be taken. 

How we got here: IMPUNITY. U.S. cancels sanctions against IDF units suspected of blatant war crimes. Because Israel pledged to do its own investigation. History show these "investigations" go nowhere except to find excuses; exonerate suspects.https://t.co/HfwJGcOwCj

— Jim Clancy (@ClancyReports) April 26, 2024

A special State Department panel proposed months ago to bar certain Israeli police and army units from receiving US funds over human rights abuses. A ProPublica report from last week indicates that Blinken disregarded the panel’s recommendations for action against the units. 

The Guardian reported in January, citing interviews and State Department documents, that “special mechanisms have been used over the last few years to shield Israel from US human rights laws.”

Tyler Durden Fri, 04/26/2024 - 18:20

UK Navy Reports Two Vessels Attacked In Red Sea, One Damaged 

Yemen's Iran-backed Houthi rebels may have launched attacks on two vessels transiting southwest of Mukha, a port city on the highly contested southern Red Sea. 

Bloomberg says the UK Navy has confirmed two attacks on vessels in a series of headlines hitting the Terminal around 1400 ET. 

• UK NAVY: REPORTS 2 ATTACKS ON VESSEL SW OF AL MUKHA, YEMEN

There are also reports that one of the vessels is "damaged." 

• UK NAVY SAYS ATTACKS RESULTED IN DAMAGE TO VESSEL

The United Kingdom Maritime Trade Operations confirmed an incident 14 nautical miles from Mukha earlier. 

The Houthis, who support the Palestinian terror group Hamas, have been launching drone and missile attacks on Western vessels since November, disrupting a critical maritime chokepoint known as "Bab-el-Mandeb Strait." 

About a week ago, 16 maritime industry associations and social partners co-signed an open letter to the United Nations urging increased military patrols on heavily traveled shipping routes. This comes after commandos seized a container ship affiliated with Israel as it passed through the Strait of Hormuz two weeks ago. 

We have diligently published notes highlighting how maritime chokepoints across the Middle East are under threat, including the Suez Canal, Bab-El Mandeb Strait, and Strait of Hormuz, through which a quarter of all global trade flows. 

The Red Sea disruption is far from over. The United States and its allies in the West are losing the battle in defending the world's major shipping lanes, as Biden's Operation Prosperity Guardian has been an absolute failure. 

All of this symbolizes the world fracturing into a multipolar state, one full of chaos. And it will only get worse from here, hence why military spending worldwide is in a massive bull market. 

Tyler Durden Fri, 04/26/2024 - 18:00

Emergency-O-Rama...

Authored by James Howard Kunstler via Kunstler.com,

“We’ll certainly never forget the dark days of June 6... January 6th, excuse me.”

- President “Joe Biden”

The plum blossoms are ready to pop here. You can feel your blood rising. The evening sun lingers a little longer every day. Normally you’d celebrate, but not this year of roaring portents and evil juju. History doesn’t stop to catch its breath for a moment. The tiny glowing diode deep in “Joe Biden’s” brain dims a bit more each day (pause) while low men and women in high places trifle with the fate of the nation. Everyone dreads what’s coming.

Which, judging by events of the week just past, looks like a worse summer of civil chaos than 2020 was.

Some entity — say, the checkbook of George and Alex Soros, maybe? — has funded the spring mustering of student mobs in support of Hamas seeking to drive wicked Israel into the choppy Mediterranean.

What you’re seeing, though, is probably not what you think you are seeing in all that. The kids are mere digits in a cultural algorithm playing out as New Age dumbshow.

I doubt that three-quarters of them actually give a flying fugazy about the Palestinians, and even fewer could find Gaza on a map if you water-boarded them.

They affect to be intersectional victims of the universal oppressor, but in so far as many of the rioters are girls of the Ivy League, or comparable redoubts of privilege— little blue-eyed, blonde-haired muffins raised on pony club, Hermes, and artisan granola — there must be something else going on.

That something else is probably sex, which is so problematical now in any traditional frame of a man getting it on with a woman that the American birth-rate is going to zero.

How does a young woman get it on with so many collegiate men vying for gay brownie points these days, or going for the grand prize in transitioning?

Why, it’s a non-starter. So, instead, you go slumming among the savages, those hairy, dumb brutes on twerk-alert, dripping testosterone — illegal aliens, student third-worlders, BLM alumni, hardcore hoodlums. They don’t know nuthin ‘bout no pony club, but they will rut like Bilberry rams until the ladies fall away crosseyed. Affecting to be a lesbian only makes the game more piquant. And if you forgot your birth control, for some reason, there’s always the abortionist.

Any time there are brownie points at stake, you know the game is actually for status, and where status is the game, fashion is the currency.

Thus, the dress-up in Arab keffiyehs, the charming head-scarf denoting allyship with Hamas. Beats the heck out of those flitty N-95 masks from the 2020 Covid nights of roistering in the Seattle CHOP and trying to burn down the Mark O. Hatfield Federal Courthouse in Portland.

Rioting gives young men of the toxic persuasion opportunities to flaunt their moxie in acts of derring-do, brawling with the cops, dancing on top of cars, ripping down chain-link fences, flinging gasoline bombs.

So much the better for getting the ladies’ attention. Look what I can do! And the keffiyeh accessorizes well with black bloc riot garb. For the muffins, wearing it is great practice for the utopia-to-come when they must don burkas under submission to Sharia. Will Hermes put out a burka?

So far, the spring rioting has mostly been fun for the rioters. Unlike the J-6-21 “paraders,” locked up in the putrid DC jail for years pending trial, the Hamas frolickers are at near-zilch risk of any serious consequences.

Few will even be suspended from school.

They are doing exactly what the schools trained them up for: destroying Western Civ, one acanthus leaf at a time.

According to the shadowy stage-managers behind “Joe Biden,” this will save our democracy.

That and stuffing Donald Trump in jail for the rest of his natural life.

Alas, the lawfare cases cooked up toward that end appear defective to a spectacular degree. It really says something about the true authors of these beauties brought by Alvin Bragg, Letitia James, Fani Willis, and Jack Smith. I speak of the behind-the-scene blob lawfare ninjas Norm Eisen, Andrew Weissmann, Matt Colangelo, and Mary McCord, who wrote the scripts for all four of this year’s big elephant trap cases against the former president. You have to wonder how that bunch made it through their law boards. The current extravaganza in Manhattan that centers on alleged book-keeping errors in furtherance of an unstated federal offense is due to go on a few more weeks. The howling errors of both the prosecution and Judge Juan Merchan are so extravagant that the proceeding looks like it was cribbed from the pages of Lewis Carroll.

Yet, there is near unanimous sentiment that the Trump-deranged New Yawk jury will convict, no matter how much more idiotic the case turns out to be. By then, we will be verging on summer. The college campuses will be shuttered and the youth-in-revolt action will necessarily move to the regular streets. Whichever way the verdict goes in the Alvin Bragg case, epic looting and rioting will commence.

Sometime this summer, I predict, the Mar-a-Lago documents case will get tossed on something like malicious prosecution. Jack Smith’s DC case, kneecapped by SCOTUS, won’t start before the November election (or maybe ever) and ditto the Fani Willis fiasco in Atlanta.

George and Alex Soros will pour millions into box lunches for the kids burning down what’s left of the cities and the demure gals of the Ivy League Left will find plenty of love in the ruins.

The two major party conventions in July (Republican) and August (Democrat) are sure to out-do the 1968 lollapalooza in Chicago (I was there) in mayhem and property damage. “Joe Biden” - really the blob behind him - will ache to declare a national emergency, perhaps even a second emergency after the recently unveiled “climate emergency” supposedly pending any day.

The USA will be in an historic horror movie you could call Emergency-O-Rama.

If you think the financial system, and the US economy that has become the tail on the finance dog, can survive all this, you will be disappointed.

The army may have to step in and put an end to these shenanigans. Don’t think it can’t happen.

*  *  *

Support his blog by visiting Jim’s Patreon Page or Substack

Tyler Durden Fri, 04/26/2024 - 17:40

US Bank Deposits Suffer Biggest Weekly Decline Since 9/11 As Tax Man Cometh

It's that time of year again and US bank deposits sure showed it...

While money-market funds' total assets fell over $100BN, on a non-seasonally-adjusted (NSA) basis, total bank deposits crashed by a stunning $258BN as Tax-Day cometh. That is considerably more than the $152BN decline last year but less than the $336BN plunge in 2022...

Source: Bloomberg

This makes some sense though as the Treasury Cash Balance rose by around the same amount as taxpayers did their duty and paid their 'fair share'...

Source: Bloomberg

However, on a seasonally-adjusted (SA) basis (i.e. adjusted by the PhDs for the fact that we get large deposit outflows at this time of year to pay taxes), total deposits dropped $133BN - the biggest weekly plunge (SA) since 9/11!

Source: Bloomberg

Excluding foreign deposits, domestic bank deposits plunged on both an SA (-$119BN: Large banks -$99BN, Small banks -$21BN) and NSA (-$241BN: Large banks -$188BN, Small banks -$53BN) basis...

Source: Bloomberg

For context, that is the largest weekly drop in SA deposits since 9/11 and the largest NSA deposit drop since April 2022 (Tax Day).

Interestingly, despite the deposit dump, loan volumes increased last week with large banks adding $5.8BN and small banks adding $2.5BN...

Source: Bloomberg

All of which pushed the un-bailed-out 'Small banks' back into 'crisis mode'  (red line below constraint absent the $126BN still in the BTFP pot at The Fed which is slowly being unwound)...

Source: Bloomberg

And so, with rate-cuts off the table - and tapering QT very much back on - we wonder just how much jockeying between Janet (Yellen) and Jerome (Powell) is going on ahead of next week's QRA and FOMC news...

Tyler Durden Fri, 04/26/2024 - 17:20

"The Yen Collapse Has Become Disorderly": Look For A Final, Sharp Decline Before It Hits A Floor

The BOJ came, issued the shortest statement in the history of central banks...

... and left, leaving traders stunned and speechless at the sheer idiocy of the world's most clownish central bank, which has decided to invite currency collapse the same abandon as Zimbabwe, if it means pushing up domestic stonks a little bit more even as hyperinflation is unleashed among Japanese society. And now that the collapse in the yen is making banana republics like Turkey blush, and is making FX managers and traders who are still long the Japanese Dong Lira Yen to the imploding "developed" insolvent, everyone wants to know what happens next?

Below we share to views, one from Deutsche Bank's Geroge Saravelos, and one from SocGen's Kit Juckes.

We start with the DB FX strategist who frames the BOJ's wilful incompetence merely as "benign neglect", to wit:

On the collapse

The yen has again collapsed today to fresh record lows following the Bank of Japan meeting. We think this is warranted and that this finally marks the day where the market realizes that Japan is following a policy of benign neglect for the yen. We have long argued that FX intervention is not credible and the toning down of verbal jawboning from the finance minister overnight is on balance a positive from a credibility perspective. The possibility of intervention can't be ruled out if the market turns disorderly, but it is also notable that Governor Ueda played down the importance of the yen in his press conference today as well as signalling no urgency to hike rates. We would frame the ongoing yen collapse around the following points.

1. Yen weakness is simply not that bad for Japan. The tourism sector is booming, profit margins on the Nikkei are soaring and exporter competitiveness is increasing. True, the cost of imported items is going up. But growth is fine, the government is helping offset some of the cost via subsidies and core inflation is not accelerating. Most importantly, the Japanese are huge foreign asset owners via Japan's positive net international investment position. Yen weakness therefore leads to huge capital gains on foreign bonds and equities, most easily summarized in the observation that the government pension fund (GPIF) has roughly made more profits over the last two years than the last twenty years combined.
2. There simply isn't an inflation problem. Japan's core CPI is around 2% and has been decelerating in recent months. The Tokyo CPI overnight was 1.7% excluding one-off effects. To be sure, inflation may well accelerate again helped by FX weakness and high wage growth. But the starting point of inflation is entirely different to the post-COVID hiking cycles of the Fed and ECB. By extension, the inflation pain is far less and the urgency to hike far less too. No where is this more obvious than the fact that Japanese consumer confidence are close to their cycle highs.
3. Negative real rates are great. There is a huge attraction to running negative real rates for the consolidated government  balance sheet. As we demonstrated last year, it creates fiscal space via a $20 trillion carry trade while also generating asset gains for Japan's wealthy voting base. This encourages the persistent domestic capital outflows we have been highlighting as a key driver of yen weakness over the last year and that have pushed Japan's broad basic balance to being one of the weakest in the world. It is not speculators that are weakening the yen but the Japanese themselves.

The bottom line is that for the JPY to turn stronger the Japanese need to unwind their carry trade. But for this to make sense the Bank of Japan needs to engineer an expedited hiking cycle similar to the post-COVID experiences of other central banks. Time will tell if the BoJ is moving too slow and generating a policy mistake. A shift in BoJ inflation forecasts to well above 2% over their forecast horizon would be the clearest signal of a shift in reaction function. But this isn't happening now. The Japanese are enjoying the ride

(More in the full note available to pro subs.)

And next, here is the somewhat more actionable view from SocGen's FX strategist Kit Juckes:

The yen's decline is becoming disorderly, which points to a final, potentially sharp, decline before it finds a floor

The Bank of Japan, as was universally expected, made no changes to interest rates at today’s policy-setting meeting, though they did edge inflation forecasts higher. Forecasts for the 2025/26 fiscal year look for core inflation (ex-food and energy) at 2.1% and real GDP growth of 1%. In Japan, as in most countries, yields have tended to average more than nominal GDP growth over time, and on that basis the US/Japanese yield differential is set to narrow significantly in the coming quarters. However, for now US yields are rising and Japanese ones are still anchored by very low short-term rates. Those short-term rates give short yen trades their positive carry and have kept the leveraged trading community happy for months.

The chart shows the US-Japanese yield differential and USD/JPY over the last 20 years, with the yield chart extended using the OECD’s forecasts for yields. These are just forecasts but they frame the issue quiet well, particularly bearing in mind how undervalued the yen is now, on any fundamental long-term valuation. If PPP for USD/JPY is now in the mid-90s, fair value adjusted for US exceptionalism and Japanification is still around 110. As long as yield differentials are large and growing, upward pressure on USD/JPY persists and while eventual return to much lower levels is inevitable, the danger here is that unless Japan’s policymakers are much more aggressive (with intervention and monetary policy), this move higher in USD/JPY will end in a final excessive spike higher.  

 

Tyler Durden Fri, 04/26/2024 - 16:40

NYPD Warns Anti-Israel Protesters A 'Seattle-Style' Occupation Zone Won't Be Tolerated

Authored by Patricia Tolson via The Epoch Times,

As protests escalate across college and university campuses in the United States, a New York Police Department (NYPD) official vowed that a “Seattle-style” occupation zone will not be tolerated on the streets of New York City.

Two New York Police Department (NYPD) officials spoke with Fox News’ “The Story” anchor Trace Gallagher on April 25. The conversation focused on growing concerns that the anti-Israel protests spreading across America’s college campuses might devolve into further violence.

NYPD Deputy Commissioner of Operations Kaz Daughtry addressed growing speculation that the student anti-Israel encampments could evolve into something similar to the “autonomous zone” established in Seattle, in Washington state, in response to the death of George Floyd in May 2020, suggesting they might “linger and last all summer long and become bigger and more dangerous.”

It was a possibility immediately shut down by Chief of Patrol John Chell.

“We will not have any Seattle-type encampments on the streets of New York City. I can guarantee you that — that would end rather quickly,” he asserted.

The Capitol Hill Autonomous Zone, also known by its acronym CHAZ and later CHOP (Capitol Hill Organized Protest), became a scene of widespread vandalism and violence that spanned more than six blocks in the Capitol Hill neighborhood of Seattle.

A shooting on June 20, 2020, claimed the life of a 19-year-old man and injured a 33-year-old man, as reported by The New York Times on July 1, 2020.  The next day, a 17-year-old man was injured in another shooting. A third shooting took the life of a 16-year-old and left a 14-year-old seriously injured.

“The fine line here is the street, the public property, which we'll deal with, and the college is the private property,” Mr. Chell explained.

“That’s why we got to strike this balance. Let me repeat, there will never be encampments on the streets of New York City while we’re in power, never going to happen.”

After the NYPD deployed counterterrorism units to the Columbia University campus, Rep. Alexandria Ocasio-Cortez (D-N.Y.) took to social media platform X to condemn the move as a “horrific” decision, adding that NYPD officers had “some of the most violent reputations on the force.”

Mr. Chell responded the next day, defending the “units” and informing her that he was with them when they were deployed to the university.

“These ‘units’ removed students with great care and professionalism, not a single incident was reported,” he said.

“Maybe you should walk around Columbia and NYU and listen to their remarks of pure hatred,” he added. “I will ensure those ‘units’ will protect you as they do for all NYers 24/7/365.”

Mr. Daugherty added his thoughts saying, “There is nothing ‘horrific’ about protecting the safety of Columbia’s young students who are just trying to go to school.”

He also defended NYPD officers, describing them as “the best and most highly trained law enforcement professionals in the world.”

Mr. Daugherty invited Ms. Ocasio-Cortez to “visit Columbia” for a walk-through, promising to protect her and take a report if she feels threatened.

Rep. Ilhan Omar (D-Minn.) speaks to a crowd gathered for a march to defund the Minneapolis Police Department in Minneapolis, Minn., on June 6, 2020. (Stephen Maturen/Getty Images)

Request for Help

The presence of the NYPD at Columbia was by request.

Columbia University’s president, Minouche Shafik, had personally reached out to the NYPD in a letter, requesting their assistance in clearing the encampment set up by more than 100 students on the south lawn of Columbia’s Morningside Heights campus on April 17.

Students had been repeatedly warned, both verbally and in writing, that they were in violation of university rules and policies and would have to disperse. Students staying in the encampment were also informed that they had been suspended.

“I have determined that the encampment and related disruptions pose a clear and present danger to the substantial functioning of the University,” she wrote,“ adding that it was ”With great regret, we request the NYPD’s help to remove these individuals.”

A total of 108 students were arrested for trespassing.

Among them was Isra Hirsi, a student from Barnard, Columbia’s sister college. Ms. Hirsi is the daughter of Rep. Ilhan Omar (D-Minn.), a frequent critic of Israel.

Following her daughter’s arrest, Rep. Omar praised her daughter on social media.

At an April 18 press conference, New York City Mayor Eric Adams explained that the arrests were made because the protesters had been camped out on Columbia’s south lawn for more than 30 hours, in violation of the university’s rules.

He confirmed that the NYPD was dispatched to the campus only after students received “numerous warnings” to disband and after Ms. Shafik reached out to the NYPD “in writing,” requesting support.

He stressed that “no violence or injuries” occurred during the incident.

While acknowledging that Columbia’s students have a right to free speech, he said they “do not have the right to violate university policies and disrupt learning on campus.”

Ms. Shafik issued a statement on April 22, expressing sadness over what is taking place on Columbia’s campus. She said the activities of the protesting students have “severely tested” community bonds and imposed a state of fear among students “across an array of communities.”

On April 21, Columbia’s chief operating officer, Cas Holloway, outlined the enhanced safety measures being imposed on the Morningside Heights campus, where the protesters were “causing considerable disruption and distress.”

The increased security measures include additional security personnel, enhanced security around the perimeter of the Morningside Heights campus, additional security at the Kraft Center, and increased identification checks to make sure that only Columbia University students are on campus.

Republicans Condemn Hatred

Rep. Virginia Foxx (R-NC), chair of the House Education Committee, sent a letter to university leaders on April 21, warning them of consequences if they do not gain control of “the encampment and related activities” which “have created a severe and pervasive hostile environment for Jewish students at Columbia.”

A total of 10 Republican members of Congress sent a letter to Ms. Shafik on April 22, urging her to resign immediately.

House Speaker Mike Johnson held a press conference on the steps of the university’s Low library near the student’s “Liberty Zone” encampment on April 24, and called for her resignation if she could not gain control of her campus.

House Speaker Mike Johnson (R-La.) holds a press conference at the Columbia campus to call for the resignation of university president Minouche Shafik, in New York City, on April 24, 2024. (Alex Kent/Getty Images)

“We just can’t allow this kind of hatred and anti-Semitism to flourish on our campuses, and it must be stopped in its tracks,” he said.

“Those who are perpetuating this violence should be arrested.”

His visit to the campus, which took place shortly after the university extended a deadline by 48 hours (until April 26) to reach an agreement on the removal of the encampment, was to show support for Jewish students, who have been intimidated, threatened, and assaulted by anti-Israeli protesters.

His presence was immediately met by boos and his comments were frequently interrupted with chants of, “We can’t hear you,” and “Free Palestine.”

The University of Southern California was forced to close its campus after campus police were overwhelmed during an effort to shut down an encampment. To clear the area, they had to enlist the help of the Los Angeles Police Department. As students surrendered peacefully, they were arrested.

Student protesters have also set up an encampment at the University of Michigan in Ann Arbor, the Detroit Free Press reported on April  23.

Nine people were reportedly arrested by University of Minnesota police after pro-Palestinian students set up an encampment on the Northrop Mall. Ms. Omar made an appearance, telling the students through a loudspeaker that she was “moved” by their “courage and bravery” in taking a stand “to end the genocide,” Star Tribune reported.

More than 20 tents, festooned with pro-Palestinian signage and flags, have been erected in front of a chapel on the campus of the Massachusetts Institute of Technology in Cambridge, as reported by CNN.

Dozens of student protesters were arrested at the University of Southern California on April 24 and the campus of California State Polytechnic, in Humboldt, was shut down as students barricaded themselves inside a building for a third day, the Associated Press reported on April 25.

At the University of Texas, 57 students were arrested by campus police during a protest organized by the Palestine Solidarity Committee when students tried to “occupy” the South Lawn, Austin television station KXAN reported.

Tyler Durden Fri, 04/26/2024 - 16:20

Micro Trumps Macro As Stocks Shrug Off Week Of Higher Inflation, Higher Rates, & Lower Growth

It was an ugly macro week...

Source: Bloomberg

...and worse still, 'growth' surprises disappointed significantly while 'inflation' surprises surprised to the upside significantly...

Source: Bloomberg

Soaring inflation expectations sent rate-cut expectations to new cycle lows...

Source: Bloomberg

...pushing yields higher across the board (led by the long-end)...

Source: Bloomberg

But, stocks didn't care about any of that because a handful of mega-cap tech stocks' earnings were awesome (except META) - and that's what matters (for now)...

Source: Bloomberg

Nasdaq outperformed, up 4% on the week (its best week since the start of Nov 2023). The Dow was the laggard on the week but all the majors had a decent week...

Not the best week for some observers...

Traders 1: Marko 0 https://t.co/T6PHjRSrMF

— zerohedge (@zerohedge) April 26, 2024

This week saw the biggest short-squeeze since the first week of March...

Source: Bloomberg

And the basket of Magnificent 7 stocks soared over 5% this week, its best week since the first week of November (Fed Pivot) - but it was noisy as TSLA surged, META tumbled, and then GOOGL/MSFT lifted the lid...

Source: Bloomberg

TSLA pushed back above $500BN market cap this week and Alphabet soared above $2TN market cap for the first time ever...

Source: Bloomberg

Tech and Discretionary outperformed on the week with Energy and Materials lagging (but all sectors ended the week green)...

Source: Bloomberg

5.00% remains the Maginot Line for the 2Y Yield...

Source: Bloomberg

Interestingly, the dollar ended the week practically unchanged - despite a lot of noise...

Source: Bloomberg

...despite the seventh straight week of declines in the yen vs the dollar as it appears the BoJ and MoF have given up...

Source: Bloomberg

Gold was dumped this week - its worst week since the start of December 2023. Spot prices did find support at $2300 though...

Source: Bloomberg

After two down weeks, oil prices rallied this week, with WTI back above $83...

Source: Bloomberg

Finally, intraday volatility has picked up dramatically in the last couple of weeks...

Source: Bloomberg

...as the distribution of possible rate outcomes has picked up significantly. Don't forget next week's QRA and FOMC as Yellen and Powell get 'back to work'.

Tyler Durden Fri, 04/26/2024 - 16:00

From the Las Vegas Visitor Authority: March 2024 Las Vegas Visitor Statistics

Benefitting from a mix of headliners and events from NASCAR to Madonna to several college basketball tournaments, Las Vegas visitation neared 3.7M in March 2024, up +0.4% YoY and nearly matching Mar 2019.

With a tough comparison to record‐breaking convention attendance last March when the destination hosted the triennial CONEXPO‐CON/AGG tradeshow (142,000), convention attendance this March saw a ‐37.2% YoY decrease.

Overall hotel occupancy reached 85.3% for the month (‐3.0 pts YoY). After breaking the record for both ADR and RevPAR last March, ADR and RevPAR saw a decrease of ‐16.4% and ‐19.2% respectively.
emphasis added

Click on graph for larger image.

The first graph shows visitor traffic for 2019 (Black), 2020 (dark blue), 2021 (light blue), 2022 (light orange), 2023 (dark orange) and 2024 (red).

Visitor traffic was up 0.4% compared to last March.  Visitor traffic was down 0.7% compared to the same month in 2019.
The second graph shows convention traffic.

Convention traffic was down 37.2% compared to March 2023, and down 12.3% compared to March 2019.  
Note: There was almost no convention traffic from April 2020 through May 2021.

Trump Responds To Main 'Hush Money' Trial Witness's Claims

Authored by Jack Phillips via The Epoch Times,

Former President Donald Trump praised the first witness in his New York City “hush money” trial, former National Enquirer publisher David Pecker, as he is scheduled to deliver more testimony in the case on Friday.

“He’s been very nice. David’s been very nice. He’s a nice guy,” President Trump said on Thursday, responding to a question about Mr. Pecker’s testimony over the past week or so.

During cross-examinations Thursday, Mr. Pecker detailed how he obtained potentially damaging stories about the candidate and paid out tens of thousands of dollars to keep them from the public eye.

But when it came to the seamy claims by adult performer Stormy Daniels, whose real name is Stephanie Clifford, the former National Enquirer publisher said he put his foot down.

“I am not paying for this story,” he told jurors Thursday at President Trump’s trial, recounting his version of a conversation with President Trump’s former lawyer Michael Cohen about attempts to suppress allegations that prosecutors claim amounted to election interference in the 2016 campaign. Mr. Pecker said that he remembers saying he “didn’t want to be involved in this.”

President Trump has maintained he is not guilty of any of the charges, and says the stories that were bought and squelched were false.

“There is no case here. This is just a political witch hunt,” he said before court in brief comments to reporters on Thursday.

Ms. Daniels was eventually paid by Mr. Cohen to not speak about her claim of a 2006 sexual encounter with President Trump. The ex-president denies it happened, while his lawyers have said that she is using the claims to make money and bolster her fame.

Although he did not buy her story, Mr. Pecker told Mr. Cohen that someone should make a move to suppress the claims from going public.

“I said to Michael, ‘My suggestion to you is that you should buy the story, and you should take it off the market because if you don’t and it gets out, I believe the boss will be very angry with you,’” he said.

Later, Trump defense attorney Emil Bove opened his cross-examination by asking Mr. Pecker about his recollection of specific dates and meanings. He appeared to be laying further groundwork for the defense’s argument that any dealings President Trump had with the National Enquirer publisher were intended to protect himself, his reputation, and his family, not his campaign.

At one point on Thursday, Mr. Pecker said that when he spoke to President Trump about the former president reimbursing Mr. Cohen for paying Ms. Clifford, the former president told him that he had no idea what Mr. Pecker was referring to. He specifically testified that the former president “had no idea what [he] was talking about” when he asked about reimbursing Mr. Cohen.

He also said that he purchased the rights to former model Karen McDougal’s story as well but he stipulated that President Trump never told him to purchase that story—only that he and Mr. Cohen were concerned about the McDougal story from emerging.

Former Trump attorney Michael Cohen arrives at the district attorney's office to complete his testimony before a grand jury in New York City on March 15, 2023. (Yuki Iwamura/AFP via Getty Images)

A conviction by the jury would not preclude President Trump from becoming president again, but because it is a state case, he would not be able to pardon himself if found guilty. The charge is punishable by up to four years in prison, although it’s not clear if the judge would seek to put him behind bars.

For the charges to be a felony, prosecutors have to prove their allegations that President Trump falsified business records in the furtherance of another crime. They have argued that the alleged falsification efforts were tantamount to election interference.

But the former president and his lawyers have said that they were simple legal expenses. They have also cast the credibility of Mr. Cohen into doubt, noting that he spent time in prison on fraud and other charges, and have noted that he has currently made a career out of criticizing President Trump in the media and on social media.

Mr. Cohen on Thursday wrote on X, formerly known as Twitter, that he would stop commenting on the Trump trial.

“Despite not being the gagged defendant ... I will cease posting anything about Donald on my X account or on the Mea Culpa Podcast until after my trial testimony. See you all in a month (or more),” he wrote.

On Friday morning, President Trump did not speak to the media before he entered the courtroom. However, he wrote a Truth Social post at around 9:20 a.m. criticizing the level of security at the Manhattan court.

“I’m at the heavily guarded Courthouse. Security is that of Fort Knox, all so that MAGA will not be able to attend this trial, presided over by a highly conflicted pawn of the Democrat Party. It is a sight to behold! Getting ready to do my Courthouse presser. Two minutes!” he wrote.

Earlier this week, he called on his supporters to peacefully protest the trial against him.

Tyler Durden Fri, 04/26/2024 - 15:40

Biden Admin Abandons Plan To Ban Menthol Cigarettes To Avoid 'Angering Black Voters'

The so-called 'party of science' has decided to abandon its plan to save millions of lives (of mostly African American youth) by choosing not to ban Menthol cigarettes after all...

In October 2023, the FDA said it was looking to ban menthol cigarettes and flavored cigars due to concerns these tobacco products are harming American youth.

"The U.S. Food and Drug Administration (FDA) is looking to ban menthol cigarettes and flavored cigars due to concerns these tobacco products are harming American youth.

The agency estimated there were 18.5 million menthol cigarette smokers aged 12 and above in the United States in 2018, with “particularly high rates of use by youth, young adults, and African Americans and other racial and ethnic groups.”

Them in December 2023, after what some called a 'blacklash', White House officials were reportedly taking more time to review their sweeping ban plan, despite the science's awful warnings:

"The federal agency estimates a ban on the flavor additive could prevent 300,000 to 650,000 smoking deaths over several decades.

They claim most of the preventable deaths would be among minority groups and Americans of African descent, who disproportionately smoke menthol cigarettes."

And now, April 2024 (around six months before the election and with Biden's poll numbers in the proverbial toilet), The Wall Street Journal reports that the Biden administration is reversing course on its plan to ban menthol cigarettes, after the White House weighed the potential public-health benefits of banning minty smokes against the political risk of angering Black voters in an election year.

Some Black community leaders had fought the measure, saying a ban would expand the illicit market for cigarettes and lead police to racially profile Black smokers.

The American Civil Liberties Union and some members of the Congressional Black Caucus expressed similar concerns.

The administration is expected to announce its decision as soon as Friday afternoon, according to people familiar with the matter.

So, to sum up: The White House is willing to ignore the potential (science-driven data) death of 650,000 mostly African American voters to improve its chances in November?

This couldn't possibly have anything to so with the fact that minorities in America are starting to look for alternatives to the Democrats they have been indoctrinated to vote for all their lives... or the fact that swing-state polls shows black voters abandoning Biden in favor of Trump is huge numbers...

Gotcha, "science" indeed!

Tyler Durden Fri, 04/26/2024 - 14:40

Port Of Baltimore Partially Reopens, Allowing Trapped Cargo Ships To Exit  

Officials at the Port of Baltimore opened a fourth, 35-foot deep, temporary channel through the collapsed Francis Scott Key Bridge, allowing cargo ships trapped at the port to exit. 

According to Bloomberg's ship tracking data, four of seven ships trapped at the port navigated the new temporary channel and are sailing down the Chesapeake Bay. 

On Thursday, the Balsa 94, a bulk carrier sailing under a Panama flag, transited the temporary channel for Saint John, Canada. Three other ships, including the Saimaagracht cargo vessel, the Carmen vehicle carrier, and the Phatra Naree bulk carrier, were also able to exit. 

The general cargo ship Balsa 94 becomes the first ship to use the @portofbalt's 35-foot-deep Limited Access Channel promised by the @USACEHQ by the end of April. The ship had been stuck in the harbor since the March 26 collapse of the Key Bridge.

Updated story here:… pic.twitter.com/LZeE9o5rne

— gCaptain (@gCaptain) April 25, 2024

The new 35-foot depth channel is a massive increase compared to smaller channels opened several weeks after the Dali container ship slammed into the bridge one month ago, toppling the bridge and paralyzing the port. 

"While this is a significant achievement, we have a long way to go, and Unified Command is committed to fully opening the channel by the end of May," US Coast Guard Cmdr. Baxter Smoak told reporters. 

Next week, salvage crews expect to refloat Dali, which will then be pushed back to port by tugboats for inspection. Once Dali and all debris are removed, the main shipping channel could reopen next month. 

However, Ben Schafer, an engineering professor at Johns Hopkins University, told AP News that a new bridge could take five to seven years to be rebuilt. 

"The lead time on air conditioning equipment right now for a home renovation is like 16 months, right?" Schafer said. 

He continued: "So it's like you're telling me they're going to build a whole bridge in two years? I want it to be true, but I think empirically it doesn't feel right to me."

Let's remember that the bridge was critical for the port and a critical feeder to the Interstate 95 highway network up and down the mid-Atlantic area. Local supply chain snarls will persist for years. 

Tyler Durden Fri, 04/26/2024 - 14:25

US State Department Arabic Spokesperson Resigns Over Biden's Gaza Policy

Via Middle East Eye

The Arabic language spokesperson of the US State Department has resigned over Washington's Gaza war policy, in the third senior level resignation from the department since the war began.

Hala Rharrit, a Palestinian-American, posted her resignation on the LinkedIn social media site, stating: "I resigned April 2024 after 18 years of distinguished service in opposition to the United States' Gaza policy."

Hala Rharrit, Arabic language spokesperson for the State Department, has quit in protest. Image: State Dept.

Rharrit, who joined the State Department as a political and human rights officer, was also the department's Dubai regional media hub deputy director.

When asked about the resignation, a State Department spokesperson told Reuters on Thursday that the department has channels for its staff to share views when they disagree with government policies.

In late March, Annelle Sheline, a foreign affairs officer in the State Department's human rights bureau, stepped down in protest over the Biden administration’s support for Israel, saying it had made her job promoting human rights "almost impossible". 

Earlier, veteran State Department official Josh Paul, a former director overseeing US arms transfers, resigned over Biden’s "destructive, unjust" supply of arms to Israel just days after the war on Gaza began.

In January, a senior Palestinian-American official in the US Education Department, Tariq Habash, resigned from his post, saying he could no longer "stay silent as this administration turns a blind eye to the atrocities committed against innocent Palestinian lives."

Despite mounting international criticism of Israel’s offensive that has reportedly killed more than 34,300 people and flattened swathes of Gaza, the Biden administration has continued to provide its ally with a steady stream of weapons. Last week, the Wall Street Journal reported that the White House was eyeing an additional $1bn weapons deal with Israel.

On Wednesday, the US Senate joined the House of Representatives in passing an aid bill that will provide $26bn in aid for Israel and Palestine, with $4bn set to replenish Israel's missile defense system and roughly $9bn slated for humanitarian assistance to Palestinians in Gaza.

There have been reports of internal dissent within the Biden administration as the death toll in Gaza continues to mount. In November, more than 1,000 officials at USAID, the State Department's international aid organisation, signed an open letter calling for an immediate ceasefire. Cables criticizing the administration's policy have also been filed with the State Department's internal "dissent channel".

The war has also sparked widespread anti-war demonstrations across the United States, with protests in recent weeks escalating across US universities. Student-led protests have seen encampments set up on major campuses demanding divestment from companies involved in Israel's occupation of Palestinian land and "genocide" in Gaza. 

Tyler Durden Fri, 04/26/2024 - 14:05

IDF Shelling Hammers Rafah As Egypt Sends Top Intel Official To Avert Ground Offensive

Egypt is attempting a last ditch effort to reach a ceasefire between Hamas and Israel at a moment IDF shelling of Rafah has intensified, in what are seen as 'softening' operations ahead of an imminent ground offensive, despite international calls to cancel the operation.

The Egyptian government on Friday dispatched a high level delegation to Israel led by top intelligence official Abbas Kamel. The Associated Press reported he is presenting a "new vision" for prolonged ceasefire.

But key to a breakthrough is agreement on the remaining Israeli hostages being released, and the two sides seem no closer to achieving that. The Wall Street Journal cites that "Egyptian officials familiar with the negotiations say the talks toward a hostage deal have little chance of success, but hope to use the meetings to buy time for the U.S. and regional powers to pressure Israel to pause its plans to attack Rafah."

While things heat up in the south of the Strip, the IDF has reportedly allowed many displaced Palestinians to return to their homes in northern Gaza "with minimum restrictions".

According to more via WSJ: "The main stumbling block in the negotiations now is Hamas’s demand that any deal include a credible path to a permanent cease-fire, rather than a temporary pause in the fighting, according to Egyptian and other officials familiar with the negotiations."

As for Egypt, it is bracing for a likely massive refugee influx across its border and into Sinai should an all-out Rafah assault be unleashed. Both Egypt and Israel have been establishing camps; however, these would likely reach and overflow in capacity within 24 hours of a Rafah ground operation.

One top Hamas official told international media correspondents that Hamas is willing to agree to a truce of five years or more with Israel. But Hamas has stuck by its key demand of a full Israeli military withdrawal from the Strip. At the same time Prime Minister Netanyahu has vowed to see through his vow of eradicating Hamas and Palestinian Islamic Jihad (PIJ) terrorists.

Hamas has also said it is willing to lay down its weapons if Israel vows to uphold a two-state solution. Some European countries have also called for this, and have pushed for Palestine to become a full-fledged member of the United Nations.

On Friday at least five more Palestinians have been reported killed by the intensified shelling in Rafah. Currently, more than half of the total Gaza Strip population of 2.3 million are believe to be packed into the southern city. Humanitarian aid organizations are warning of an impending disaster if there is a full military ground offensive. The past weeks have seen dozens killed in similar shelling attacks.

A large segment of the Israeli population believes that Prime Minister Netanyahu is launching into a Rafah operation full-steam for the sake of his political survival. One fresh Haaretz headline, for example reads: "Fearing the End of His Coalition, Netanyahu Edges Toward Rafah Operation Over Hostage Deal".

IMPORTANT — It could take 14 years to clear debris in #Gaza

An estimated 37 million tonnes of debris has been left by #Israel’s war on Gaza’s widely urbanised, densely populated territory.

Source — Pehr Lodhammar, senior officer at the United Nations Mine Action Service… pic.twitter.com/VwpKyPmE8u

— Hala Jaber (@HalaJaber) April 26, 2024

Below are some fresh Associated Press headlines detailing the latest developments Friday...

• Ship comes under attack off coast of Yemen as Houthi rebel campaign appears to gain new speed
• Satellite photos show new port construction in Gaza Strip for US-led aid operation
• Some campuses call in police to break up pro-Palestinian demonstrations, while others wait it out
• Chef José Andrés says aid workers killed by Israeli airstrikes represented the ‘best of humanity’
• UN report says 282 million people faced acute hunger in 2023, with the worst famine in Gaza
• EU military officer says a frigate has destroyed a drone launched from Yemen’s Houthi-held areas
• North Gaza still headed toward famine, UN food agency says
• Israel masses military vehicles along Gaza border

Tyler Durden Fri, 04/26/2024 - 13:45

The Constitutional Abyss: Justices Signal Desire To Avoid Both Cliffs On Presidential Immunity

Authored by Jonathan Turley,

Below is my column in the New York Post on yesterday’s oral arguments on presidential immunity. As expected, with the exception of the three liberal justices, the Court appears to be struggling to find a more nuanced approach that would avoid the extreme positions of both parties. Rather than take a header off either cliff, the justices seem interested in a controlled descent into the depths of Article II.

Here is the column:

Writer Ray Bradbury once said, “Living at risk is jumping off the cliff and building your wings on the way down.”

In Thursday’s case before the Supreme Court on the immunity of former President Donald Trump, nine justices appear to be feverishly working with feathers and glue on a plunge into a constitutional abyss.

It has been almost 50 years since the high court ruled presidents have absolute immunity from civil lawsuits in Nixon v. Fitzgerald.

The court held ex-President Richard Nixon had such immunity for acts taken “within the ‘outer perimeter’ of his official responsibility.”

Yet in 1974’s United States v. Nixon, the court ruled a president is not immune from a criminal subpoena. Nixon was forced to comply with a subpoena for his White House tapes in the Watergate scandal from special counsel Leon Jaworski.

Since then, the court has avoided any significant ruling on the extension of immunity to a criminal case — until now.

There are cliffs on both sides of this case.

If the court were to embrace special counsel Jack Smith’s arguments, a president would have no immunity from criminal charges, even for official acts taken in his presidency.

It would leave a president without protection from endless charges from politically motivated prosecutors.

If the court were to embrace Trump counsel’s arguments, a president would have complete immunity.

It would leave a president largely unaccountable under the criminal code for any criminal acts.

The first cliff is made obvious by the lower-court opinion. While the media have largely focused on extreme examples of president-ordered assassinations and coups, the justices are clearly as concerned with the sweeping implications of the DC Circuit opinion.

Chief Justice John Roberts noted the DC Circuit failed to make any “focused” analysis of the underlying acts, instead offering little more than a judicial shrug.

Roberts read its statement that “a former president can be prosecuted for his official acts because the fact of the prosecution means that the former president has acted in defiance of the laws” and noted it sounds like “a former president can be prosecuted because he is being prosecuted.”

The other cliff is more than obvious from the other proceedings occuring as these arguments were made. Trump’s best attorney proved to be Manhattan District Attorney Alvin Bragg.

If the justices want insight into the implications of denying any immunity, they just need to look north to New York City.

The ongoing prosecution of Trump is legally absurd but has resulted in the leading presidential candidate not only being gagged but prevented from campaigning.

Alvin Bragg is the very personification of the danger immunity is meant to avoid.

With cliffs to the left and the right, the justices are looking at a free-fall dive into the scope of constitutional and criminal law as they apply to presidential conduct.

They may be looking not for a foothold as much as a shorter drop.

Some of the justices are likely to be seeking a third option where a president has some immunity under a more limited and less tautological standard than the one the DC Circuit offered.

The problem for the court is presidential privilege and immunity decisions are meant to give presidents breathing room by laying out bright lines within which they can operate.

Ambiguity defeats the purpose of such immunity. So does a test that turns on the motivation of an official act.

The special counsel insists, for example, Trump was acting for his personal interest in challenging certification and raising electoral fraud since he was the other candidate.

But what if he wasn’t on the ballot — would it have been an official function to raise such concerns for other candidates?

When pressed on the line between official and nonofficial conduct, the special counsel just dismissed such concerns and said Trump was clearly acting as an office-seeker not an officeholder.

Likewise, the special counsel argued the protection for presidents must rest with the good motivations and judgment of prosecutors.

It was effectively a “Trust us, we’re the government” assurance. Justice Samuel Alito and others questioned whether such reliance is well placed after decades of prosecutors’ proven abuses.

Finally, if there is no immunity, could President Barack Obama be prosecuted for ordering the killing of a citizen by drone attack and then killing his son in a second drone attack?

The government insisted there is an exception for such acts from the murder statute.

In the end, neither party offers a particularly inviting path. No immunity or complete immunity each holds obvious dangers.

I have long opposed sweeping arguments of immunity from criminal charges for presidents. The devil is in the details, and many justices are struggling with how to define official versus nonofficial conduct.

The line-drawing proved maddening for the justices in the oral argument. The most they could say is similar to the story of the man who jumped off a building. As he passes an office window halfway down, another man calls out to ask how he’s doing. The jumper responds, “So far so good.”

As the justices work on a new set of legal wings, anything is possible as the nation waits for the court to hit ground zero in the middle of the 2024 presidential election.

Tyler Durden Fri, 04/26/2024 - 13:25