The Fed Has Crossed The "Hard Landing" Rubicon So How High Will It Hike? One Bank Crunches The Numbers One month ago, a SocGen strategist calculated something remarkable: at a time when the Fed is warning of multiple 50bps hikes in coming FOMC meetings and Powell is threatening to take fed funds above neutral - somewhere in the great unknown zone between 2.0% and 4.5% - and even the gradually fading market consensus still expects just under 8 hikes this cycle... ... quant Solomon Tadesse calculated that according to his analysis, if the Fed i focused on preserving growth (at the expense of higher inflation), then Fed Funds will peak at just around 1.0%, which combined with a QT programme to the tune of about $1.8tn, means the Fed will very soon be forced to reverse. Furthermore, as Tadesse has since pointed out, with the Fed’s recent bold 50bp hike, "there does not seem much room left for manoeuvring for the desired soft-landing." He then echoes what we have been saying in recent weeks, namely that the "type of week-long market meltdown witnessed since the recent hike often precedes a policy about-face in line with our projection." Ok but what if having decided to push the US into a recession, growth be damned, the Fed is now focusing only and entirely on inflation?  After all, current rates are far, far below the prevailing CPI which is around 8%, and while many argue whether CPI has peaked, there is a significant possibility CPI could hit double digits in the coming months. This is the question that Tadesse addresses in his latest must-read note (available to pro subs in the usual place), in which he writes that "an inflation-fighting impulse is currently in the air, begging the question of what it could take to stamp out the current trend for good, even at the cost of a hard landing." According to the SocGen quant, given the rising inflation prints and accompanying political pressure, if the pro-growth tightening threshold is breached - which it likely will be as soon as the next FOMC meeting, making a hard landing inevitable, and unleashing the Fed in favor of a single-minded inflation-fighting policy stance, Tadesse's analysis suggests that it "could take overall monetary tightening of as much as 9.25% to arrest inflation, with the policy rate going up to 4.5% and the balance coming from QT of about $3.9tn, which would slash the current Fed balance sheet by about half." Here is some more detail from the SocGen quant on this potential "alternative" in which the Fed single-mindedly pursues inflation containment, going Volcker-style with accelerated rate hikes reminiscent of the 1970s and early 1980s, when the average MTE (tightening to easing) ratio was about 1.5x (left-hand chart below).: Such aggressive monetary tightening with a focus solely on inflation containment, even at the cost of inducing recession, according to our analysis, would require overall monetary tightening of about 11.6%. Given that rates have already been tightened by 2.5%, another 9.25% of monetary tightening might be expected via policy rate hikes and an aggressive QT program. The policy rate could go up by as much as 4.5%, with the remainder coming from QT (right-hand chart above). These projections are all before the 4 May rate hike of 50bp, which lowers the balance proportionately. At a rate of 12bp per $100bn of QT, this also amounts to a QT program of about $3.9tn, roughly equivalent to the net growth in the Fed’s balance sheet during the pandemic. An important caveat in the analysis is the presumption that current inflation levels resemble those of the late 1970s through the 1980s. As recent inflation prints are the highest in 40 years, this might be a reasonable assumption, particularly in reference to the rates seen in the early 1980s. In addition, in interpretating the results, there is an implicit assumption that the current inflation prints are persistent and demand driven. However, as our earlier analysis shows, the current inflation dynamics are driven both by transitory supply-related disruptions and demand-driven price pressures. Should the supply bottlenecks ease over time, the degree of monetary tightening needed to contain inflation through demand destruction could turn out to be lower. The above-left chart shows monetary policy frontiers (MPF). These are all the policy-rate hike and QT combinations that could generate the inflation-containing overall tightening of upwards of 9pp and the growth-conscious overall tightening discussed earlier, with the most likely outcomes of policy combinations identified with stars. Thus, our analysis suggests that while it might only take another 25-50bp for growth-conscious tightening to peak before a hard landing, an aggressive inflation-containing policy could mean additional policy rate hikes of up to 4.0pp. As noted earlier, the above analysis assumes that the Fed is resigned to a hard-landing. Does it mean that a soft-landing is now inevitable? Pretty much. Here is Tadasse again: In an earlier research note, we argued that if current monetary policy follows a pro-growth impulse, as has been the case over the past four decades, the current tightening phase could peak with only 0.75-1pp of rate hikes, combined with a QT program to the tune of about $1.8tn. After the Fed’s recent bold 50bp hike, there now does not seem to be much room left for manoeuvring toward a soft landing. Moreover, the type of week-long market meltdown witnessed since the hike has often preceded a policy about-face, which is what we expect. Summarizing the above, the SocGen quant writes that "monetary policy is thus at a crossroads, with a stark choice between a ‘growth’ conscious, albeit inflationary, rate-hike cycle, peaking after 300bp of tightening (with a mix of QT and FFR) or an inflation-containing, albeit recessionary, rate-hike cycle, peaking at about a 925bp of overall tightening (with a mix of 450bp in policy rate and the balance from QT)." And while there could be possibilities in between these two extremes, the middle ground may not, in general, be an admissible rational strategy. Such an intermediate path, plausible due to political pressure or a mid-course reversal in policy priorities between price stability and full employment, would likely fail to accomplish either mandate and could damage central bank credibility. What does this mean for traders? Nothing good - as Tadesse concludes, equity strategies do not fare well in scenarios of high inflation and declining growth (i.e. stagflation), as companies struggle with falling revenues and rising costs, lower growth causes lower earnings, and higher rates combined with an increase in the equity-risk premium negatively impact valuations. And while SocGen notes, that "cash flow and balance-sheet strength would matter for relative performance here", we would add that the real question is how fast does the market expect inflation to shrink back to the 2-3% range. The answer to that question will determine most investing strategies for the next year or so. For those unable or unwilling to answer, a simple heuristic is that strategies that pay high dividends at cheap valuations (such as quality income) should do well in this environment. So should equity strategies dominated by firms with pricing power, such as those in the upstream of the production chain, as should defensive equity strategies with stable cash flows and relative pricing power (such as utilities, the quality and quality income factors). Pair trades can use these as the long legs, offset with shorts among cyclical and aggressive growth strategies. The full note quantifying how high Powell will raise rates is available to pro subs. Tyler Durden Thu, 05/19/2022 - 22:00.....»»

China In Talks To Buy Cheap Russian Oil For Strategic Reserves China is in talks with Russia to buy its cheap oil to replenish strategic reserves, in the latest indicator of deepened energy ties between the two large powers and rivals to the United States. It's also the latest sign that a mulled EU Russian oil embargo may in the end be blunted before it ever gets off the ground, amid continuing inter-EU resistance led by Hungary. Bloomberg reports Thursday that "The crude would be used to fill China’s strategic petroleum reserves, and talks are being conducted at a government level with little direct involvement from oil companies, said a person with knowledge of the plan." Novokuibyshevsk oil refinery plant in Russia, via Chron.com Currently the EU is negotiating toward a phased embargo, seeking to find compromise with those central and eastern European members which are heavily dependent on Russian energy. The prior US ban on imports of Russian oil, which came early in the invasion of Ukraine, has already served to push more Russian oil tankers east towards Asia, diverting from Western markets. India too has reportedly been taking advantage of the comparatively cheaper prices. A source privy to the talks said they aren't close enough that a deal is guaranteed to be signed, nor is an estimated volume of crude Beijing is reportedly seeking known at this point. "There is still room to replenish stocks and it would be a good opportunity for them to do so, if they can be sourced on commercially attractive terms," a senior oil analyst at industry firm Kpler, Jane Xie, told Bloomberg. The report cites the data analytics firm to estimate that China's "overall stockpiles are at 926.1 million barrels, up from 869 million barrels in mid-March -- but still 6% lower than a record in September 2020." And by way of comparison, "the US Strategic Petroleum Reserve has a capacity of 714 million barrels. It currently holds about 538 million barrels." Chart via Reuters China remains the world's single biggest buyer of Russian oil, with official Chinese government figures for 2021 showing it imported almost 1.6 million barrels per day of Russian crude that year. But the immediate impact of Western punitive action targeting Moscow has seen more shipments sent to Asia. "China is now clearly buying more Ural cargoes. Ural exports to China have more than tripled. This is despite a weakening of Chinese imports," said Homayoun Falakshahi, senior analyst at Kpler, as cited in Reuters Tyler Durden Thu, 05/19/2022 - 22:20.....»»

NY Governor Announces New Gun Control Plans After Buffalo Shooting, Signs Order On Domestic Terrorism Authored by Mimi Nguyen Ly via The Epoch Times, New York Gov. Kathy Hochul on Wednesday proposed new measures and signed an executive order to “strengthen and close loopholes” in the state’s gun laws in the wake of the deadly shooting in Buffalo, New York. New York Gov. Kathy Hochul speaks to guests during an event with President Joe Biden and several family members of victims of the Tops market shooting at the Delavan Grider Community Center in Buffalo, New York, on May 17, 2022. (Scott Olson/Getty Images) The governor also signed a separate executive order to “combat the steady rise in domestic terrorism and violent extremism” and “crack down on social media platforms that host and amplify content that promotes and broadcasts violent, lawless acts,” according to a press release from her office. Payton Gendron, 18, is accused of having opened fire at a supermarket in Buffalo on May 14, killing 10 people and injuring three others. He surrendered to police who confronted him at the site. Gendron was arraigned on a first-degree murder charge to which he has pleaded not guilty. As of May 19, he is jailed under a suicide watch. Buffalo supermarket shooting suspect Payton Gendron in a jail booking photograph. (Erie County District Attorney’s Office via AP) Gun Control Proposals Hochul said her office will work with legislators to propose a package of laws that will strengthen current gun control measures and tighten any loopholes in the state. The suspected shooter had legally bought his weapon, a Bushmaster XM-15 rifle, and later modified it with an extended magazine, which is illegal to own in New York. “The gun the individual purchased in our state was legal,” Hochul told reporters. “But what happened was, is that you can go literally across the border to Pennsylvania and buy a magazine with 30 bullets in it. And that’s what happened. You can get the base gun here legally in the state of New York, go buy a high capacity magazine, and just attach it. That’s what happened.” “So, we have to deal with this. And we will, we will. We have announced there is a package of gun laws that we’re going to be proposing. We have more guns to deal with.” As part of a slew of measures, Hochul said her office will address “AOW” or “any other weapons,” which refers to a new category of weapons with characteristics that fall between rifles, shotguns, and pistols. Such weapons were “specifically designed to fall outside the realm of regulation, so they’re not subject to [New York] laws,” Hochul said. “We are introducing legislation that revises the definition of a firearm to include those weapons, which means we’ll be able to charge and prosecute people accordingly,” she said. Hochul also said New York’s red flag law needs to be strengthened. Red flag laws allow law enforcement to confiscate guns from those who are believed to pose a danger to themselves or others. “People are wondering how you had the right to acquire the weapon in the first place when you are this individual. We have red flag laws in place to prevent exactly this situation,” Hochul said. The governor issued an executive order to require the New York State Police to file an extreme-risk order of protection under New York’s red flag law when they have probable cause to believe that an individual is a threat to themselves or others. “Previously, current law, it’s an option to do so. And now, it’ll be a requirement,” Hochul noted. Gendron was able to purchase his weapon in part because he was never reported under New York’s red flag law, which would have prevented the store from selling him the weapon. Officials said on May 15 that last year, Gendron had made a reference to a murder-suicide in a paper he submitted at his high school, after which New York State Police took him into custody and had him undergo a mental health evaluation in June 2021. He was released about a day-and-a-half later, and was not charged criminally. According to a 180-page manifesto posted online that is alleged but not confirmed to have been written by Gendron, the Buffalo area was chosen as the target of the shooting because of strict laws governing gun ownership there and because it has a large black population. The Epoch Times has not been able to independently verify whether the manifesto was written by Gendron. The Erie County DA’s office told The Epoch Times that they are investigating the manifesto. Police stand in front of a Tops Grocery store in Buffalo, New York, on May 15, 2022, the day after a mass shooting inside the supermarket left 10 people dead and three wounded. (Usman Khan/AFP via Getty Images) Domestic Terrorism The author of the manifesto had identified themselves as a white supremacist. Authorities said Gendron live-streamed the shooting online. Police have called the shooting a “hate crime and racially motivated violent extremism.” Hochul told reporters on Wednesday that the suspect shooter was “radicalized by white supremacists and white nationalist beliefs.” She said such messages and racist philosophies are “easily accessible on social media platforms.” The incident was “white supremacy in this nation at its worst,” Hochul said, adding, “The most serious threat we face as a nation is from within … It’s white supremacism.” Hochul is signing another executive order to “fight the troubling surge in domestic terrorism and violent extremism frequently inspired by, planned on, and posted about on social media platforms and Internet forums,” her office said. The order will establish a unit within the Office of Counter-Terrorism at the Department of Homeland Security and Emergency Service to focus exclusively on domestic terrorism. “First time ever. They’ll develop the best practices for law enforcement, for mental health professionals, for school officials to address the rise in homegrown extremism. And we’ll make sure that they’re trained to know how it occurs, where it occurs, and how to stop it,” Hochul said. She said a “Threat Assessment Management Program” will be launched that will include multi-disciplinary teams in counties throughout New York State that will identify and assess the domestic terrorism threats. “This coordination is critical, it does not exist now,” Hochul said. “It does not exist, that these stakeholders need to be communicating and sharing information … Who heard what, who saw something? And then you get the law enforcement, and the mental health professionals, in some cases, school professionals, actually communicating about what they’re seeing. We have a much better opportunity to be in the prevention business, instead of just the cleanup business.” People participate in a vigil to honor the 10 people killed in the May 14, 2022 shooting at Tops market in Buffalo, New York, on May 17, 2022. (Scott Olson/Getty Images) Social Media Hochul said the executive order she’s signing will also establish a dedicated domestic terrorism unit in the New York State Intelligence Center to track domestic violent extremism through social media. “We’re going to ensure that we have the best-in-the-nation cybersecurity teams to monitor the places where radicalization occurs,” Hochul said. She said the suspected shooter’s live-stream of the shooting had “created an opportunity for people to see this and share what he was doing,” after which people would “create platforms so they can share their demented ideas with each other in the hopes that this continues to spread, the virus spreads,” thereby “radicalizing more.” The governor said that algorithms on some social media platforms can serve to “elevate hateful incendiary speech.” “There’s algorithms in place that ramp up and share this [hateful speech] even more, with higher frequency than other messages. So this incendiary content is pushed out to more people in 2022,” she said. “That’s how radicalization is occurring, through the social media echo chamber. … These social media platforms have to take responsibility. They must be more vigilant in monitoring the content, and they must be held accountable for favoring engagement over public safety.” Hochul said she has requested New York State Attorney General Letitia James’s office to investigate the social media platforms that broadcast the attack and that “promote and elevate hate speech.” James announced on Twitter on Wednesday: “My office is launching investigations into the social media companies that the Buffalo shooter used to plan, promote, and stream his terror attack. We are investigating Twitch, 4chan, 8chan, and Discord, among others, all platforms that the shooter used to amplify this attack.” Zachary Stieber contributed to this report. Tyler Durden Thu, 05/19/2022 - 22:40.....»»

Maersk & Goldman Warns China Restart Will Spark Renewed Supply Chain Congestion A.P. Møller – Maersk A/S, the world's largest container shipping company by capacity, and Goldman Sachs' supply chain congestion analysis (in separate reports) indicate if China restarts, renewed supply chain congestion will be seen worldwide.  Maersk told its Asia-Pacific customers that China's zero COVID policy to lockdown Shanghai, the world's largest port and China's financial hub, for nearly two months, will "have an effect all over the world in the coming months."  For seven weeks, a massive parking lot of vessels has been building outside Shanghai ports as operations came to a crawl because of the lockdown of 26 million residents.  Since the lockdown began in late March, Goldman Sachs' weekly congestion index has slid as US West and East Coast port congestion plunged. This is because the trans-Atlantic volume of vessels from China to the US declined as port capacity was restricted due to lockdowns.  Maersk told clients, "statically speaking, the virus is under control," and this could soon indicate Chinese port capacity may expand and sailings could increase to the US, which will only complicate things down the line for US West Coast ports as a backlog of goods will flood US ports.  Goldman also agrees and warns: "We could see a resurgence of ship bottlenecks if sudden restarts in China lead to renewed sailings all at once." A forward leading indicator of Chinese port activity and if a resurgence of bottlenecks is ahead for the US are global container freight rates.  Weekly changes of the World Container Index show that when China went into lockdown, container rates for 40-foot boxes dropped.  By shipping lane, if there's a tick-up in freight rates between China and the US West Coast, then it would be safe to assume China is restarting.  If China restarts and container rates begin to rise, the countdown will be about 1-2 months until a massive backlog hits US ports, renewing port congestion right before midterm elections.  Tyler Durden Thu, 05/19/2022 - 23:00.....»»

California To Spend $5.2 Billion On 'Electricity Reserve' To Avoid Blackouts Authored by Julianne Geiger via OilPrice.com, California has proposed spending $5.2 billion on creating a "strategic electricity reliability reserve" that would help the state avoid blackouts when its electric grid is stressed, a 2022-2023 budget revision document showed on Friday according to Bloomberg. California has weathered a fair amount of criticism over its electric grid, which contributed to rolling blackouts as recently as 2020. California warned last week that it could run into electricity shortages this summer with drought, heatwaves, and wildfires continuing to stress the grid. But renewables and California's electricity exports have also stressed the grid. The Reserve will be developed using existing generation capacity that was scheduled to retire, new generation, new storage projects, clean backup generation projects, customer side load reduction capacity that is visible to and dispatchable by CAISO during grid emergencies, and diesel and natural gas backup generation projects - which the budget document stressed would have emission controls and all required permits. Of note were two items in that list: "existing generation capacity that was scheduled to retire" and "diesel and natural gas backup generation projects". California is set to retire 6,000 MW of nuclear and gas-fired energy production. The Reserve will be capable of providing up to 5,000 MW that will be available whenever the grid is stressed. The new budget would also earmark $8 billion over five years to increase the state's system reliability and provide relief to consumers as electricity rates rise. The budget now calls for $22.5 billion in funds for the purpose of "climate resilience and integrated climate, equity, and economic opportunity across the state's budget to mobilize a coordinated all-of-government response to the climate crisis. Tyler Durden Thu, 05/19/2022 - 23:20.....»»

Hamptons Pool Craze Has Some Homeowners Waiting Years For A Dip  Hamptons, New York's summer playground for Wall Street execs and Hollywood celebrities, has an extremely tight housing inventory -- following two years of city-dwellers fleeing cities for the cozy beach town. During the pandemic, residents expanded backyards and many desired luxury pools. There has been a backlog of pool building, with some residents waiting at least one year or more for their backyard oasis.  Pools and spas are in high demand that has inundated pool builders in the Hamptons. The pool industry has never had this much demand in the area, mainly due to the work-at-home lifestyle and influx of new residents.  Greg Darvin, the owner of East Hampton, New York-based company, Pristine Pools, told Bloomberg that massive backlogs and long waitlists would persist for the next few years. "If you haven't planned your 2023 pool yet, you're too late," he said.  Before the pandemic, Darvin said clients wouldn't commit until they were ready for a new pool. "Now we book one year ahead, and we immediately go into hard contract," he added.  Supply chain shortages and soaring material costs have also been an issue. "Now we buy anything we can find and store it," he added.  The high-end pool market hasn't slowed down (yet) and could remain robust through 2023. With so much pool building demand pulled forward in the last few years, the question remains what happens after 2024.  Tyler Durden Thu, 05/19/2022 - 23:40.....»»

Rickards: "We Are On The Precipice" Authored by James Rickards via DailyReckoning.com, I don’t believe many people grasp the enormity of the global food crisis we’ll be facing in the months ahead. But the world could be on the verge of a massive humanitarian crisis. Let’s dive in… The supply chain collapse preceded the war in Ukraine, but the war has only intensified the problems. You can see it with your own eyes when you walk into a supermarket and find long stretches of empty shelves in stores that used to be chock-full of food and other merchandise. Even goods that are available such as gasoline are being sold at much higher prices. Prices for gasoline (and diesel, which is critical for goods transportation) have more than doubled in the past nine months. All of this is clear. The question is will it get worse from here? Unfortunately, the answer is yes. Bob Unanue is the CEO of Goya Foods, which is one of the largest food distributors in the world. Few people are better positioned to assess the global food situation than Unanue, who deals with raw food deliveries on the one hand and retail customers on the other. Unanue is now warning, “We are on the precipice of a global food crisis.” Other experts are quoted making a similar point. That’s not hyperbole or fearmongering, but a serious analysis. Here’s why… 29% of All Wheat Exports in Jeopardy In the Northern Hemisphere, the planting season for 2022 is well underway. Crops were planted (or not) in March and April. Based on that, you can already form estimates of output next September and October during the harvest season (subject to some variability based on weather and other factors). Plantings have been far below normal in 2022, either due to a lack of fertilizer or to much higher costs for fertilizer where farmers simply chose to plant less. This predictable shortage is in addition to the much greater shortages due to the fact that Russian output is sanctioned and Ukrainian output is nonexistent because it’s at war. Russia and Ukraine together account for 29% of global wheat and 19% of global corn exports. Russia and Ukraine together produce 29% of all the wheat exports in the world. That doesn’t mean they grow 29% of the wheat in the world. It means they grow 29% of the wheat exports. The U.S., Australia, Canada and others grow a lot of wheat but consume most of it themselves. They export relatively little. Importantly, they don’t simply eat it. They feed it to their farm animals. People don’t often make the connection between grain and animal products, but it’s critical. Many countries get 70–100% of their grains from either Russia or Ukraine or both. Lebanon gets 100%. Egypt is over 70%. Kenya, Sudan, Somalia, many central African countries and Jordan and other Middle Eastern countries receive much of their grain from Russia or Ukraine. No Planting, No Crops But it’s worse than that because not only are many Ukrainian exports shut down now, but the planting season is nearly over. And you’re not going to get any grain in October if you didn’t plant it in April or May. And they didn’t for obvious reasons. What that means is you project ahead to October, November, December of this year, those countries I mentioned are not going to be able to get their grain supplies. There simply aren’t going to be any, or they’ll be greatly reduced. The combined population of countries that get between 70% and 100% of their imports from Russia or Ukraine is 700 million people. That’s 10% of the global population. So you’re looking at mass starvation. You’re looking at a humanitarian crisis of unprecedented proportions, probably the worst since the Black Death of the 14th century. That’s coming down the road, even if most people can’t see it coming or fully fathom the depths of the coming crisis. In short, we know enough now to predict much higher prices, empty shelves and, in some cases, mass starvation in the fourth quarter of this year and beyond. Beyond the humanitarian aspect of the coming food shortages, there are also potentially serious social and geopolitical ramifications. Another Arab Spring? You remember the “Arab Spring” starting in 2010. It started in Tunisia and spread from there. Well, it was triggered by a food crisis. There was a shortage of wheat, which triggered the protests. There were underlying problems in these societies, but a food crisis was the catalyst for the protests. Now, many poorer countries in the Middle East and Africa are facing a much greater crisis as the impact of shortages manifests itself later this year and into next year. Will we see even more social unrest than in 2011? It’s very possible, and it could be even more destabilizing than the Arab Spring. We could also see waves of mass migration from Africa and the Middle East as desperate and hungry people flee their homelands. Europe endured a wave of mass immigration in 2015. Many migrants were attempting to flee the war in Syria, but there were great amounts of people who weren’t affected by the war. They were just seeking better lives in the welfare states of Europe. Mass starvation could trigger an even greater migration, which would present Europe with enormous challenges. The United States could also witness another wave of migration at the southern border, which is currently being inundated by migrants. A global food crisis could send the numbers spiraling to uncontrollable limits. What if the War Drags On? And what if the war in Ukraine drags on well into next year? Next year’s growing season would also be disrupted and the shortages could extend into late 2023 and beyond. Well, maybe some would argue that other nations could pick up the slack and grow additional grain. That’s nice in theory, but it’s not that simple. Russia is the largest exporter of fertilizer, and sanctions are cutting off supplies. Many farmers cannot get fertilizer at all, and those who can are paying between twice and three times last year’s price. That means that crops actually produced will have much higher prices because of the higher price of inputs such as fertilizer, and the higher transportation costs due to higher prices for diesel and gasoline. Like I said earlier, we’re looking at a humanitarian crisis of unprecedented proportions, probably the worst since the black death of the 14th century. And we’re not prepared to handle it. Tyler Durden Thu, 05/19/2022 - 21:20.....»»

68% Of CEOs Say Fed Policy Is About To Trigger A Recession No matter how many Tom Lees and Marko Kolanovics CNBC wants to roll out to try and play things off like everything is fine, most CEOs - who spend their time in the real world instead of "analyzing" it - are bracing for a recession.  In fact, "CEO confidence has tumbled to the weakest level since the beginning of the Covid-19 pandemic", a new report from CNN, citing The Conference Board, said this week. CEO confidence is now negative for the first time during the economic expansion, the report notes. The C suite is bracing for a turndown as a result of Fed policy, the report notes.  68% of CEOs expect that Fed policy is going to trigger a recession, according to a survey fielded between April 25 and May 9 which looked at the responses of 133 CEOs. Despite this, only 11% of these CEOs are predicting a "hard landing". Most CEOs said they expect a "very short, mild" recession. We'll make sure to keep an eye on this figure as we progress further into 2022, especially if the Fed decides to hold course.  Dana Peterson, The Conference Board's chief economist, said: "Businesses are being challenged on so many fronts right now and CEOs have elevated expectations of a recession." 61% of CEOs surveyed also said that economic conditions have worsened over the last 6 months. This compares to 35% who said the same in Q1. Only 14% of CEOs said they see "improving economic conditions".  Mike Sommers, CEO of the American Petroleum Institute, commented: "Recessionary-concerns are real." He added that recessions often follow interest rate hikes.  Despite this, there are some "economists" who continue to argue that recession isn't necessarily imminent. RSM chief economist Joe Brusuelas concluded: "Concerns about an immoderate near term recession are generally overblown. The Fed is attempting to thread the needle while wearing boxing gloves and a mouth guard which reduces its degrees of freedom to act without causing damage to the real economy." Tyler Durden Thu, 05/19/2022 - 21:40.....»»

$18 For A Michelob Ultra: "Beer-Flation" Hits PGA Championship.....»»

Japan Probably Needs To Move To The Pro-China Camp By Russell Clark of the Capital Flows and Asset Markets Substack Japan has benefited massively from the free trade world that the US conjured into existence 40 years ago. Japanese industry and particularly its auto industry benefited hugely from access to the US auto market. For this reason, I expected US new car CPI moved higher (car prices rising after years of stagnation) that this would be Yen bullish. Instead the Yen has weakened considerably. From a macro and micro perspective, the idea of a stronger Yen with surging automobile prices makes sense. However, from a political point of view, I think this is probably wrong. Japan has for many years had a huge imbalance in auto markets with the US. Nissan, Toyota and Honda all have huge operations in the US, but you barely see a US auto brand in Japan. In a competitive democracy like the US, how could politicians possibly be elected pushing policies that expose domestic labour to foreign competition? I suspect after the inflationary 70s, politically there seems to me to be a coalition of consumers who wished to see inflation tamed, as well as business and capital owners that wanted to see union power crushed. Allowing first Japanese, and then other producers destroy the unionized US auto makers was a political win. That is the Japanese automakers were the spear tip of a policy to destroy US unions. However, the rise of “populism” everywhere in the West has shown is that the electorate has tired of “pro-capital” policies. For someone my age, pro-capital policies, or Washington Consensus policies were implemented by governments of all stripes, regardless of any political promises that were made. And I learned to ignore politics when investing, but 2016 I think has changed that calculation. Perhaps the best graph I can find to show the political change manifesting in real world change is US tax collections from Customs (ie tariffs). This is still a small number, but the political implications are huge. The US now cares when its imports come from, after decades of not caring, and will use tariffs to achieve political ends. Why is this a negative for Japan? Well of the three big economic blocs, Japan only runs a trade surplus with the US. At what point do political calculations, lets say for Candidate Trump, move to the idea of supporting US unionised workers in electorally competitive North East? As this map of unionisation in the US shows, unions members are more prevalent in the north east and California. Republicans candidates running on socially conservative issues, while protecting US businesses from foreign competition looks like an election winner to me, as it has been in the UK. On this analysis, Japan has real problem. The market it generates its trade surplus with looks to be changing politically. The current economic policy of weak yen and export lead growth looks to be an economic and politically dead end to me. The question is whether Japan will change policies? The biggest possible change they could embrace would be to come to a détente with China. The biggest sign that such a change was in the offing would be Japan beginning to build up gold reserves instead of treasuries, as this would allow them to facilitate trade with China, while avoiding any possible US sanctions. Maybe the small increase in gold holdings in Japan are a sign of this change? Japan is often considered Western, but culturally it is much closer to China than the US. The US/Japan military and economic alliance made Japan Western. If the US is unable to defend the Asia Pacific, which is increasingly likely, and US politics is turning against free trade, Japan is going to have to come to an “understanding” with China. If Japan builds gold reserves instead of treasuries, the financial effects will be profound. Tyler Durden Thu, 05/19/2022 - 20:00.....»»

"Build Blackouts Better": Half Of America Faces Power Blackouts This Summer, Regulator Warns  Tens of millions of Americans could be thrown into a summer of hell as a megadrought, heatwaves, and reduced power generation could trigger widespread rolling electricity blackouts from the Great Lakes to the West Coast, according to Bloomberg, citing a new report from the North American Electric Reliability Corporation (NERC), a regulatory body that manages grid stability.  NERC warned power supplies in the Western US could be strained this summer as a historic drought reduces hydroelectric power generation due to falling reservoir levels and what's expected to be an unseasonably hot summer. Compound the hellacious weather backdrop with grids decommissioning fossil fuel power plants to fight climate change and their inability to bring on new green power generation, such as solar, wind, and batteries, in time, is a perfect storm waiting to happen that will produce electricity deficits that may force power companies into rolling blackouts for stability purposes. The regulatory body pointed out that supply-chain woes are delaying major Southwest solar projects, while some coal plants have trouble procuring supplies because of increased exports. They said there's also an increasing threat of cyberattacks from Russia.  By region, the Midwest power grid will be extremely tight. Across the Western US, power generation capacity has declined 2.3% since last summer, even as demand is expected to increase. Grids in the region may have to source power from neighboring grids as extreme heat will cause people to crank up their air conditioners. A situation of low wind speeds could trigger blackouts, according to NERC. They outlined how the Midwest could face power shortfalls due to the removal of power capacity from retiring fossil fuel power plants.  NERC issued a similar warning last year, stating power grids that serve 40% of the US population were at risk of blackouts. One year later, there was only one notable blackout last June during a heatwave in the Pacific Northwest that left 9,000 customers without power. But with reduced electricity generation capacity outpacing new green power sources, the risks of blackouts are increasing this year.  In Texas, the Electric Reliability Council of Texas (ERCOT)has already warned multiple times of grid stress as early summer-like heatwaves sent temperatures in certain parts of the state into triple-digit territory.  California's grid operators have also warned of rising blackout threats --for the next three summers -- as the state transitions to greener forms of energy. The drought and shrinking reservoir levels have reduced hydroelectric power generation on top of decommissioned fossil fuel power plants. "We know that reliability is going to be difficult in this time of transition," said Alice Reynolds, president of the California Public Utilities Commission, during a May 6 press conference.  NERC's report is an eye-opener for those living in the Western US. Many households face out-of-control inflation, soaring fuel prices, and food shortages ahead of what could be a summer of unrest as the Biden administration is bracing for a wave of violence upon the Supreme Court's overturn of Roe V. Wade.  America is slipping into the abyss as households get a taste of what it's like to live in Venezuela. It's not that far off from what people are experiencing today: soaring inflation, shortages, a ruling regime which so many claim was not elected by the majority and soon, rolling blackouts.  Tyler Durden Thu, 05/19/2022 - 20:20.....»»

Biden's Big Lie: 'Green' Energy Doesn't Save Money, It's 4-6 Times More-Expensive Op-Ed authored by Stephen Moore via The Epoch Times, President Joe Biden keeps claiming that wind and solar energy are going to save money for consumers. But more government subsidies to “renewable energy” is a key feature of the White House anti-inflation strategy recently announced by Biden. U.S. Representative Alexandria Ocasio-Cortez (D-N.Y.) and U.S. Senator Ed Markey (D-Mass.) (R) speak during a press conference to announce Green New Deal legislation to promote clean energy programs outside the U.S. Capitol in Washington, D.C., on Feb. 7, 2019. (Saul Loeb/AFP via Getty Images) He probably got that idea from John Kerry, the administration’s climate czar, who recently claimed that “solar and wind are less expensive than coal or oil or gas.” Pete Buttigieg, the Biden Transportation secretary, makes the same claims about the thousands of dollars that motorists can save if they buy electric cars. This couldn’t be more wrong. Proponents of “green” energy boondoggles are often masters at playing with the numbers, because that is the only way that wind and solar electricity generation make any sense. Advocates such as Kerry love to focus on the low operating costs of solar and wind since they don’t require constant purchases of fuel. Ignoring the relatively short lifespan of solar and wind components, as well as the high initial investment, can make it appear as though solar and wind operate at lower costs than fossil fuels or nuclear power. Let’s get the facts straight. The cost isn’t just what you pay at the retail level for gas or power. It also includes the taxes you pay to subsidize the power. A 2017 study by the Department of Energy found that for every dollar of government subsidy per BTU unit of energy produced from fossil fuels, wind and solar get at least $10. That’s anything but a money saver. The reason the subsidies are so high is that solar and wind have additional costs compared to their more reliable competition. “Green” energy sources are non-dispatchable, meaning their output can’t be changed to match demand. The wind doesn’t blow harder, and the sun doesn’t shine brighter, just because electricity use is peaking. Conversely, fossil fuel entities—such as a coal plant—can ramp up generation when we need it most and ramp down when demand falls. Widespread adoption of solar and wind generation would necessitate expensive batteries on a large scale to ensure that people still have power when the wind stops blowing or when the sun stops shining—like it does every single night. So, unlike reliable and flexible natural gas, solar and wind require large-scale storage solutions: massive banks of batteries that are hardly environmentally friendly but are also extremely expensive. And since batteries don’t last forever, they add to both the initial expense and maintenance costs during the life of a solar or wind energy generating station. The same problem exists with electric cars. The sticker price on EVs is considerably higher than for conventional gas-operated cars, and the so-called savings over time assume that the electric power for recharging is free. But it isn’t and power costs are rising almost as fast as gas prices. Factors such as these are consistently ignored by Kerry and other “green” energy activists. To genuinely evaluate dissimilar energy sources and provide an apples-to-apples comparison, the U.S. Energy Information Administration uses the Levelized Cost of Energy (LCOE) and the Levelized Cost of Storage (LCOS). These measures consider the initial costs, the lifespan of generation and storage systems, maintenance and fuel costs, decommissioning expenses, subsidies, etc., and compare that to how much electricity is produced over a power plant’s lifetime. The numbers don’t lie: “green” energy is a complete waste of resources. The LCOE and LCOS for solar and on-shore wind farms are four times as expensive as natural gas. But offshore wind takes the cake—it’s six times as expensive as natural gas. Imagine paying four to six times as much every month for the same electricity! That’s the green paradise world that the Biden administration wants for America. Yet, it’s even worse than that because electric power costs greatly affect the cost of producing nearly everything else. In the case of producing aluminum, for example, a third of the total production cost is electricity alone. Imagine what quadrupling electricity prices would do to the prices of all the goods and services that people buy. If you think inflation is bad now, just wait until the nation is dependent on wind and solar—then you’ll see REAL price increases. And despite official government data contradicting their own claims, the Biden administration—including Kerry—continues spouting simple untruths on wind and solar. They hope that no one will check their fantastic facts. To the left, wanting it to be true, makes it true. All the while, the middle class is being crushed by $4-a-gallon gasoline and businesses everywhere are buckling under $5-per-gallon diesel. The Wall Street Journal warns that electric power blackouts could be coming because of overreliance on wind and solar power. At some point, if this push for green energy continues, the whole nation will start to look like California, where gas is $6 a gallon, the lights go out, and electric cars are stranded because of rolling blackouts.  If that’s our “green” future, then Americans should want nothing to do with it. Stephen Moore is a distinguished fellow in economics at the Heritage Foundation, and E.J. Antoni is a research fellow in Heritage’s Center for Data Analysis. Moore is a co-founder of the Committee to Unleash Prosperity, where Antoni is a senior fellow. Views expressed in this article are the opinions of the author and do not necessarily reflect the views of The Epoch Times or Zero Hedge. Tyler Durden Thu, 05/19/2022 - 20:40.....»»

'76' Gas-Station Chain Repograms Washington State Pumps For $10 A Gallon  Gas station pumps in Washington state are being reprogrammed to accommodate $10 a gallon and even higher as the summer driving season begins amid tight fuel supplies, according to a report.  The Post Millennial has learned gas station chain "76" has reprogrammed its pumps to include double-digit numbers in "price per gallon" at Washington state gas stations. A 76 spokesperson confirmed to The Post Millennial they added an extra digit to pumps, noting the change doesn't necessarily imply the company was anticipating prices above $10 a gallon.  The 76 gas station in Auburn, Washington, located at 1725 Auburn Way North, is one of the stations that has had reprogrammed pumps. It also sells high-octane race fuel, which tends to be more expensive, though the special fuel is sold at separate pumps than regular, plus, premium, and diesel.  A photo was taken on May 16 that shows double-digit pricing at regular pumps.  The Post Millennial also reports Washingtonians in the eastern part of the state, specifically in Kennewick, Pasco, and West Richland, are experiencing fuel shortages.  According to AAA, the average price of gas at a pump in Washington State is $5.18 -- above the national average of $4.59 as of Thursday morning. Some of the most expensive gas in the US can be found just south of the state in California, where prices outside of San Francisco range between $6-7 a gallon for regular.  76's move for double-digit prices comes as JPMorgan's commodity strategist Natasha Kaneva warns the national average for gas can rise another 37% by August to around $6.20. Since much of the West Coast is priced above the national average, this may suggest double-digit prices could be seen in some areas.  Tyler Durden Thu, 05/19/2022 - 21:00.....»»

Calls Emerge For China To Deploy Digital "Helicopter Money".....»»

Pennsylvania County Bans Ballot Drop Boxes Authored by Beth Brelje via The Epoch Times (emphasis ours), A standing room-only crowd made up mostly of organized, left-leaning, political activists shouted, “Shame! Shame!” when commissioners in Pennsylvania’s Lancaster County voted to remove a ballot drop box placed at the county building on Monday, the day before the primary election. Ballot drop box before it was removed from the Lancaster County building in Penn. on May 16, 2022. (Beth Brelje/The Epoch Times) Now, instead of placing absentee ballots in the drop box located just three steps inside the door of the county building, voters will have to walk about 30 steps into the building, from the same door, to get to the Board of Elections office where they will hand their ballot directly to one of the workers. Anyone entering the building beyond the drop box must go through a metal detector manned by the sheriff department. Opponents say this makes voting “too difficult and complex” for voters. At the time of the commissioners’ vote on Monday, the county’s lone drop box had only been in place since Friday. Around the nation, the use of unmanned drop boxes has met with scrutiny amid evidence of suspected fraud. The Dinesh D’Souza film “2000 Mules” features government surveillance footage showing people stuffing drop boxes with multiple ballots in multiple locations in numerous states. Another investigation by Pennsylvania’s Lehigh County District Attorney’s Office, in which detectives reviewed hours of video of the county’s drop boxes for the October 2021 elections, found hundreds of people putting multiple ballots into unmanned drop boxes. Pennsylvania law requires a voter to send an absentee ballot by mail or deliver it personally. Yet, Gov. Tom Wolf’s wife, Frances Wolf, broke this law in the October 2021 election, when she deposited her own ballot along with her husband’s ballot in a York County ballot drop box. The governor later called it an honest mistake. Lancaster County had not intended to provide a drop box for the primary election, but the county was sued last week by the American Civil Liberties Union, claiming that it had failed to meet in the sunshine to decide not to use drop boxes. But a judge ruled on May 13 that the decision not to used drop boxes was administrative and did not need to be discussed in a public meeting, Lancaster County Commissioner Ray D’Agostino told The Epoch Times. The judge ordered the county to return to status quo, which he considered to be with drop boxes. He also allowed for the commissioners to meet on Monday and vote on the use of ballot boxes in the county. Lancaster County Commissioners in Penn. vote to ban ballot drop boxes on May 16, 2022. (Beth Brelje/The Epoch Times) With one commissioner out of town, two of the three commissioners met at 11 a.m. on May 16 and passed a resolution banning ballot drop boxes from being used in Lancaster County for this primary or any future election, unless compelled by Pennsylvania statute or by an official legal authority. Before the vote, commissioners took about an hour of public comment. In a group email, Duncan Hopkins, an organizer with the advocacy group Lancaster Stands Up, rallied Democrats to attend the meeting. In the email, he alleged that commissioners “are working so hard to confuse voters and make it more difficult for many to cast a ballot so close to an election.” Representatives from the NAACP, League of Women Voters, Lancaster Democratic Party, Lancaster City Democrats, Pennsylvania CASA, and Lancaster Stands Up implored the commissioners to expand drop boxes to every community in the county instead of removing the county’s only drop box. “It is a sense of privilege to say everyone can get here to vote,” said one woman, whose mother is 96 and uses oxygen. Often, activists would snap fingers in unison or murmur support when one of their group spoke. “I don’t understand why you want to make it harder to vote,” another person told the commissioners. LaRock Hudson, political action chair for the local NAACP, challenged commissioners to provide data proving that drop boxes cause voter fraud, as preventing possible fraud was a reason mentioned in the resolution for banning drop boxes. The introduction of drop boxes was a decision made in response to the COVID-19 pandemic. Lancaster County used a drop box in 2020 and 2021 for COVID-19 mitigation. The drop box was placed near sheriffs handling security for the building, they had an election person watching the box at all times, and it was surveilled by camera. “Things have changed, COVID is no longer such an issue, we are short staffed,” D’Agostino said. “We can’t have sheriffs doing a job of election staff, and election staff have better things to do than sitting at a box when people aren’t there. They could be sitting at their desk and as people come in, take the ballot. But when they’re not taking ballots, they can be doing other work, so there’s no need, quite frankly, to have that box there anymore.” Several people spoke in favor of removing the drop box. Kirk Radanovic, chairman of the Lancaster County Republican Club, said he was representing the 176,000 Republicans of Lancaster County who expect the commissioners to remove the ballot drop boxes to keep election integrity safe. Another speaker said our parents and forefathers managed to get to the polls to vote, even when they worked or lived far away from the polls, and they expected to get election results on election day. She reminded attendees that verified absentee ballots have always been available for those who are too sick to get to the polls. Dan Medbury, a Lancaster County resident and member of the John Birch Society, said the difficulty of voting is not in getting to the polls, but investing the time as a voter to research the positions of candidates. “Too many people want extreme ease when they don’t take time to study the issues,” Medbury said. After the resolution was passed, the ballot drop box was removed from the front door. The nearby election office will remain open until 8 p.m. until election day to receive any hand delivered ballots. Tyler Durden Thu, 05/19/2022 - 18:40.....»»

Economic Optimism Has Collapsed Under Biden: Poll While the Biden administration continues to congratulate itself for the 'strongest job creation economy in modern times' (which isn't difficult when your y/y baseline was caused by economy-killing lockdowns), most people aren't buying it. In fact, as people face $100 tanks of gas and skyrocketing grocery prices, the Economic Optimism Index poll from IBD/TIPP plunged 9.5% in May, dropping to 41.2 - which, as Issues & Insights' editorial board notes, puts it firmly in the pessimism zone. This marks the worst reading since the height of the COVID pandemic, which bottomed out at 44 in July 2020. Meanwhile, the PBD/TIPP Financial Stress Index has skyrocketed - hitting 69.3 (above 50 indicates 'high stress') - or around where it was during the 2008 financial crisis. Under Biden's watch it's climbed 22%. As I&I notes: For Biden to say the economy “is on the move” is truly delirious. GDP was down 1.4% in the first quarter, and nearly half of adults think we are already in a recession, the IBD/TIPP poll found.  DOOCY: "Americans are now spending $5,000 a year on gasoline. That’s almost double what they did a year ago. Where are people supposed to go to get all that extra cash?" JEAN-PIERRE: "To get the extra cash to pay for gas?” DOOCY: “Yeah.” JEAN-PIERRE: “Well, I mean..." pic.twitter.com/KPzvhGxx78 — Breaking911 (@Breaking911) May 18, 2022 I&I also points out that while Biden brags about creating "8.3 million jobs in my first 15 months in office - a record," there were 12.5 million jobs created during the last nine months of the Trump administration - with more than half of those having been lost during the lockdowns. More via I&I: Biden also likes to boast about wage growth, without pointing out that inflation has climbed faster than wages, leaving workers worse off – real wages are down 3% since he took office. This, too, is a dramatic turnaround from the Trump years, when real wages climbed 10%.   The IBD/TIPP Poll found that only 18% of the adults surveyed say their earnings have kept pace with inflation.   ...  In his remarks last week, Biden said “when you look at the economy today, it’s clear that we’ve made enormous strides.”   He’s right about that. Unfortunately, those enormous strides have all been in the wrong direction. Tyler Durden Thu, 05/19/2022 - 19:00.....»»

DOJ Antitrust Head Set To Heighten Scrutiny On PE Firms Rolling Up Entire Industries The Department of Justice could be on its way to ending private equity's strategy of rolling up entire industries before hollowing them out and cashing out. For PE firms, the new scrutiny by regulators could arguably be coming at the worst time, as asset prices have started to plunge due to the Fed's new hawkish monetary policy stance.  Jonathan Kanter, head of the DoJ’s antitrust unit, told the Financial Times this week: “Sometimes [the motive of a private equity firm is] designed to hollow out or roll up an industry and essentially cash out. That business model is often very much at odds with the law, and very much at odds with the competition we’re trying to protect.” He said that buyouts were “an extremely important part of our enforcement programme,” FT reported. Kanter is "one of several progressive officials appointed by Joe Biden", the report notes.  Meanwhile, firms like Blackstone have come under fire in recent years for owning larger and larger portions of the U.S. economy. The industry has been red hot, with a record 14,730 deals taking place globally last year. This was nearly double the previous high and amounts to $1.2 trillion in transactions. The report notes that PE firms are starting to turn into the very same corporate giants they once assisted in breaking up.  FT predicts that Kanter is leading enforcement for PE down the same path that technology companies have gone down with regard to anti-trust scrutiny.  “Many of the mergers we’re confronting are as a result of [private equity] roll ups,” he said, noting that the DOJ will be looking at “interlocking directorates”, which is where PE executives sit on the boards of numerous companies in competition and/or in the same industry.  Kanter noted that this could be a violation of the 1914 Clayton Antitrust Act.  He continued: “Very often settlement divestitures [involve] private equity firms [often] motivated by either reducing costs at a company, which will make it less competitive, or squeezing out value by concentrating [the] industry in a roll-up.” “So in many instances, divestitures that were supposed to address a competitive problem have ended up fuelling additional competitive problems.” “If we’re going to be effective, we cannot just look at each individual deal in a vacuum detached from the private equity firm,” he concluded. “It’s important that we articulate a tractable, legally sound framework in the merger guidelines, but one that’s broad enough and flexible enough to address issues [including] private equity [or] technology.” Tyler Durden Thu, 05/19/2022 - 17:40.....»»

Border Patrol Union Leader Warns Of "Complete Control" By Cartels Once 'Title 42' Ends Authored by Rita Li via The Epoch Times (emphasis ours), The head of the Border Patrol union warned that drug cartels would seize “complete control” of the southern border, as a Trump-era public health order to expel illegal immigrants is to expire on Monday. “That we just don’t have anybody in the field, that we just can’t patrol the border,” National Border Patrol Council President Brandon Judd said during Fox News’ “America’s Newsroom,” after being asked about the “worst-case scenario” once the law ends on May 23. National Border Patrol Council President Brandon Judd at a border meeting in Del Rio, Texas, on July 18, 2021. (Charlotte Cuthbertson/The Epoch Times) He said the Border Patrol system is running out of capacity as overwhelmed border agents will be largely held up by processing asylum-seeking illegal immigrants, either refereeing their claims or expelling them back to their home countries. “When you look right now, we already start our shifts with 50 percent of our resources not even performing enforcement activities. They’re in administrative duties. Once this explodes, we’re going to have nearly 100 percent of our people doing administrative duties rather than enforcement duties.” “That’s going to give complete control to the cartels. That’s a scary situation to be in,” he added. Judd was referring to Title 42, a COVID-19-era policy implemented during the Trump administration in March 2020 to quickly expel illegal immigrants on public health grounds. The measure has so far blocked over 1.7 million illegal aliens at the U.S.–Mexico border in the past two years, yet is set to expire on May 23 under President Joe Biden, given that public health conditions have changed. According to a May 16 court document filing, U.S. border officials encountered more than 234,000 illegal immigrants at the U.S.–Mexico border in April, with 96,908 deported back to Mexico under Title 42. It topped March’s 22-year high of just over 221,000 illegal immigrants and marked the fourth time that monthly border encounters have topped 200,000 under Biden. The border crisis “clearly began” the time Biden took office in January 2021, according to Senate Minority Whip Sen. John Thune (R-S.D.). “If he ends Title 42 policies next week, we’re going to need a much taller chart,” he said in a May 18 Twitter post. “By empowering the Cartels instead of @CBP [Customs and Border Protection], Biden is actively threatening the health and safety of our communities,” said Rep. Glenn Grothman (R-Wis.), the ranking member on the National Security subcommittee, on May 17. Rep. Diana Harshbarger (R-Tenn.) said the same day that “only the cartels are happy” about the lift. The Biden administration has said it is preparing for scenarios of up to 18,000 encounters per day when the order lifts. Both Republicans and moderate Democrats, including those in tough races for November midterms, have warned about the lack of a comprehensive plan to tackle the potential immigrant inflow at the border once Title 42 lifts. During a visit to the southwest border in the Rio Grande Valley on May 17, Homeland Security Secretary Alejandro Mayorkas said his department is prepared for the ending of Title 42. “That does not mean that the border is open beginning on May 23,” Mayorkas said. “We continue to enforce the laws of this country. We continue to remove individuals who do not qualify for relief under the laws of this country.” The annual deportation has fallen dramatically under Biden. In the financial year 2021, just over 59,011 were deported, compared to about 185,884 in 2020 and 267,258 in 2019, according to data released by the U.S. Immigration and Customs Enforcement. Haitian migrants continue to cross across the U.S.–Mexico border on the Rio Grande as seen from Ciudad Acuña, Coahuila state, Mexico, on Sept. 20, 2021. (Paul Ratje/AFP via Getty Images) An April Convention of States Action and Trafalgar Group poll (pdf) said a majority of American voters, including nearly two-thirds of Hispanic voters, believe the Biden administration should close the southern border until a solution is reached. U.S. District Judge Robert Summerhays, a Trump appointee, had earlier granted a temporary restraining order blocking the administration from terminating the Title 42 emergency border powers. The Biden administration has requested the federal judge, according to judicial notice, to make a decision on the lawsuit by Friday “to avoid uncertainty that could pose operational challenges.” “The Biden administration is scrambling five days before their own deadline to end Title 42 because President Biden’s open border policies have created, in the words of Homeland Security Secretary Alejandro Mayorkas, an ‘unsustainable’ crisis for our country,” House Minority Leader Kevin McCarthy (R-Calif.) told Fox News in a statement. The Department of Homeland Security and the White House did not immediately respond to a request for comment. Tyler Durden Thu, 05/19/2022 - 18:00.....»»

US Says Iran Deal "Far From Certain" After EU Scrambled To Save Nuclear Talks The Iran nuclear talks in Vienna have largely dropped from the news given they've been stalled for months, after delegations returned to their capitals. Iran said there was nothing more to do and that a finalized restored JCPOA deal was within reach, only that it was up to Washington - which it accused of stalling. The Biden administration has meanwhile stopped just short of declaring the negotiation dead altogether, while also lately issuing vague statements that it hadn't shut the door. The European Union has meanwhile scrambled to save the process while emphasizing it's back on. Via Reuters EU officials have held extensive meetings in Tehran: "Enrique Mora, the senior EU official coordinating the nuclear talks, traveled to Iran in an effort to overcome a seven-week stalemate in talks between the U.S., Iran and Western powers. Senior Western officials told Politico that the discussions, which spanned Wednesday and Thursday, created new progress, but that an agreement remained far from certain." The latest out of the State Department is that the US remains committed to seeing a deal come through. Spokesman Ned Price on Tuesday still stressed that a deal is "far from certain." "We and our partners are ready. We have been for some time. We believe it is now up to Iran to demonstrate its seriousness," Price stated, in what was the first official admin comment since the EU meetings with Iranian officials to salvage the deal. But currently the Washington and Tehran sides still see the ball in the other's court, suggesting a stalemate is still on. "At this point a deal remains far from certain. Iran needs to decide whether it insists on extraneous conditions and whether it wants to conclude a deal quickly, which we believe would serve all side's interests. We and our partners are ready, and have been for some time. It's now up to Iran," a US admin official told Reuters. One key incentive for the Biden administration is a return to Iranian oil supplies on the global market. Currently the US is even seeking to bring Venezuela's Nicolás Maduro 'in from the cold' at a moment the EU is mulling a Russian oil embargo, which the White House is encouraging. Tyler Durden Thu, 05/19/2022 - 17:00.....»»

Massive Pandemic Unemployment Insurance Fraud Still Being Stonewalled By State Of Illinois Authored by Mark Glennon via Wirepoints.org, How unemployment claims were mismanaged during the COVID pandemic is shaping up as a historic fiasco. It’s therefore no surprise that the State of Illinois is stonewalling the facts about its share of the problem so aggressively. Nationwide, the scope of unemployment insurance fraud during the pandemic is stunning. Estimates of how much state governments wrongly paid out during the pandemic reach as high as $400 billion, which is fully half of the total $800 billion paid out, as reported by NBC. The latest official estimate is $163 billion lost to fraud, which is from the U.S. Department of Labor in March. Illinois’ share of that loss to fraud is unknown because the state won’t tell us, but it could easily be $6.5 billion, which would be its share of the Labor Department’s estimated loss. As far back as June 2021, the Chicago Tribune reported that “if the amount tracks with national estimates, it could involve billions of dollars.” For months, some Illinois reporters have hounded the responsible Illinois agency for answers. That’s the Illinois Department of Employment Security (IDES). But neither it nor the Pritzker Administration has provided any useful answers on how much was lost, why or how it can be stopped in the future. The most recent chapter came last week in a Freedom of Information Act response by IDES  reported by CBS Chicago. “The agency has historically refused to publicly disclose the scope of pandemic-related unemployment fraud,” CBS said, and it FOIAd for tracer reports on one particular slice of the fraud story, which is known payments to legitimate recipients that somehow got intercepted by fraudsters. CBS had to go to the Illinois Attorney General to force an answer out of IDES, and the response showed at least 1,000 records of intercepted payments. That’s as if IDES merely threw CBS a bone. It tells us little because we have no idea how many other instances of intercepted payments occurred or how much fraud in other forms occurred, such as by claimants who were fictitious to begin with. And the CBS Chicago FOIA request only covered the period from March 1, 2021 through Nov. 30, 2021 — a timeframe in which in which CBS says “IDES sources said they began to see fraud numbers spike.” Why CBS would trust IDES on that is a mystery since the entire point is that IDES either doesn’t know or is hiding fraud numbers. Some other states have been far more open about efforts together to get to the bottom of pandemic unemployment fraud. In Ohio, for example, the state’s top auditor estimates their fraud losses at about $5 billion and says openly, “The system failed at almost every conceivable level.” California publicly posts its data on estimated losses and other unemployment fraud data. But in Illinois, we get almost nothing. About the only number IDES and the Pritzker Administration have provided is their unverified claim that they stopped some one million fraudulent claims. That’s nice, but what matters is how many they didn’t stop, how it happened and how to fix it. The biggest reward that will come to states that have been open and honest about the fraud problem is that they likely will better control it the next time an emergency demands massive unemployment assistance. In Illinois, we can expect mistakes to be repeated. Tyler Durden Thu, 05/19/2022 - 17:20.....»»