Questions & Answers

Authored by James Howard Kunstler,

"I’m the look-around candidate. All you have to do to understand why I’m surging in the polls is just look around. . . ."

- Spencer Pratt

Just watch in wonder and nausea as California’s mail-in ballots dribble in, providing a real-time demonstration of the “Our Democracy” party spitting in the country’s face again, since everybody knows exactly what’s going on.

Meanwhile, the Senate voted down the SAVE Act again this week by 52 to 48 for. . . reasons. But, hey, cheer up, it’s Pride Month. At the same time that California was queering its own “jungle primary,” a troupe of drag queens swanned and capered around New York’s City Council Chamber in what was called a “Pride Ball” (actually more of a show than a ball).

And what it really showed is that the party running New York City has no shame. How, exactly, does mental illness intersect with the public interest, you might ask? Historians of the future, roasting armadillos-on-the-half-shell over their campfires, will probably figure it out. For now, you must pretend that no such question even exists. Don’t bother asking. Just go along with the gag.

Here’s a scene you might like to see: As you know by now, the president has nominated Acting Attorney General Todd Blanche to be the Senate-confirmed full-on, bona fide AG. But Senator Thom Tillis (R-NC) says he would require Mr. Blanche to declare that the Jan 6, 2021, Capitol riot was “an insurrection.” Wouldn’t it be fun to hear Mr. Blanche reply by saying, “Can’t do that, sir, because the DOJ has an ongoing case that involves dozens of federal officers from several agencies instigating the events of that day in collusion with members of Congress and the US military, and, well, I can say no more about that at this time. . . .”

Similarly, election fraud. Just days ago, Mr. Trump, told Miranda Divine of The New York Post, “We had a rigged election [2020], we can’t have rigged elections. We know who rigged the election. We know everything now. . . we have information that nobody thought was possible. . . . Let’s see what happens.”

Hmmmm. . .. Wouldn’t that prompt you to suspect that the DOJ has a case, or multiple cases, involving 2020 election fraud cooking on its stove? Recall that not long ago the FBI seized 700 boxes of evidence from the Fulton County Election Hub in Union City, GA. And another truckload out of Maricopa County, AZ. Do you think they’ll discover some, er, irregularities in all that? Perhaps eye-wateringly blatant?

Would it not then be urgent to seek indictments of actual persons, if any are deserved, well before November, so that measures could be taken to preclude more fraud and cheating in the midterm election — measures like . . . passing the SAVE Act!

How might Majority Leader John Thune explain his intransigence on the matter in the face of all that? Or, like New York’s City Council, does he have no shame?

In another momentous development this week, the new management at CBS-News cashiered 60-Minutes star Scott Pelley for apparent insubordinate behavior in a confab with the show’s newly-hired Executive Producer Nick Bilton and Mr. Bilton’s boss, Editor-in-Chief Bari Weiss. They had already sacked the querulous Sharyn Alfonsi a week earlier. Of course, 60-Minutes, with its giant audience following NFL games, was one of the main units in the Deep State’s gaslighting apparatus, and Mr. Pelley burned brightest there for years, flaring out one lying-ass narrative after another from the Russia Collusion hoax to 2020 election fraud to the Jan 6 fake “insurrection,” with the same burnished arrogance he showed his new bosses. Gone now. . . buh-bye. Next up, Lesley Stahl (“Sir!!! Sir !!!”), and the self-important prick Bill Whitaker. Fire them all!

If you seek to understand why the American public is so deeply bamboozled, it is largely the utter failure of the news business. You can trace that to a couple of signal changes of policy. One was the 1987 repeal of the FCC’s “Fairness Doctrine,” which required TV stations holding federal licenses to cover controversial public issues in a “fair and balanced manner.” The other was the 2013 “modernization” (under Barack Obama) of the Smith-Mundt Act (1948), which had prohibited the US government from “propagandizing” its own citizens — and after “modernization” turned squishy on that.

The 1975–1976 (Sen. Frank) Church Committee — the Senate Select Committee to Study Governmental Operations with Respect to Intelligence Activities — documented that the CIA had long-term secret relationships with dozens of U.S. journalists. This is casually referred to as “Operation Mockingbird.” Since the Church Committee, it has only gotten much worse as the Deep State struggles to cover-up layer upon layer of crimes it keeps committing. The nightly news shows now are just anchors and “panelists” shooting their mouths off. The news itself goes mostly unreported. A big reason is that broadcast news now employs nearly zero correspondents in-the-field. Nobody is out there reporting on events. They don’t want to spend the money. So, the news just spins and spins, mostly in the service of manufactured lies.

Also last week, famous New York Times columnist and fake Nobel economics prize-winner Paul Krugman put out a video calling for the “purging” of MAGA and everything MAGA-adjacent from American life — when his team (the party of “Our Democracy”) comes back to power, as it must.

He didn’t detail whether this process would entail internment camps and crematoriums, but you could infer as much from his tone.

Kinda gives you a clue of where their heads are at.

Tyler Durden Fri, 06/05/2026 - 16:20

Ringing The Bell: Meta Plunges On Report It May Sell "Tens Of Billions" In New Stock

They don't ring the bell at the top, but they sure do sell a lot of stock.

With SpaceX, Anthropic and OpenAI looking to IPO hundreds of billions in common stock (not counting even more hundreds of billions in lock up expirations that will hit the market soon)...

... coupled with Google's record $80 Billion follow on offering (of which half was a memestock-esque At The Market offering direct to retail), suddenly the cash-incinerating AI companies - already full to the gills with SPV and various other forms of debt - are realizing that if they don't move fast they will miss the boat.

And sure enough, FT reports that arguably the biggest cash burner of the lot, Meta, is considering raising tens of billions of dollars in a stock offering as it seeks new sources of capital to fund Mark Zuckerberg’s vast ambitions in AI, following the launch of Google’s record $85bn share deal this week.

According to the report, company execs have been exploring “creative” ways to raise cash as it prepares to sharply boost its AI-related capital expenditures to as much as $145bn this year and even higher in 2027, according to three people familiar with the plans.

The discussions intensified after the success of Google parent Alphabet’s equity raising this week, which was increased by $5bn after strong investor demand, but - as noted above - GOOGL has a much more viable cash flow profile than Meta, which will be FCF negative this year.

The news sent META stock plunging to the lowest level since early April. 

Meta’s decision to consider a fresh share sale comes amid a frenzy of activity in US equity capital markets, with Elon Musk’s SpaceX set to hold its initial public offering next week and AI groups Anthropic and OpenAI also working on plans for massive Wall Street debuts. 

Mega tech companies have also tapped debt markets - which as we said last year AI is also now a bubble - as they rush to finance AI infrastructure, including chips and data centers.

Meta CFO Susan Li is leading the talks over the potential share sale alongside Dina Powell McCormick, who moved from Meta’s board to take a more active role as president in January. Powell McCormick has been tasked with overhauling Meta’s approach to AI infrastructure and financing, with a focus on longer-term planning as it enters the most capital-intensive period in its history.

Meta must find new ways to fund the huge data centers needed to train and run advanced AI models to fulfil Zuckerberg’s vision for “personal superintelligence” delivered through Facebook, WhatsApp and Instagram, as well as a family of AI-powered wearables such as smart-glasses and voice pendants.

Meta has not yet hired banks and ultimately may not issue new stock. One person cautioned that it was “premature” to say that the company had decided what to do and all financing options remain on the table.  A Meta spokesperson said the share sales talks were “pure speculation”, but added “we’ve been clear that huge opportunities lie ahead in AI, and we’ll continue focusing on raising capital in the most flexible ways to support that”.

A person familiar with Meta’s discussions said the group had looked at the structure of Alphabet’s capital raising, which included “mandatory convertible preferred issuance”. This allows it to raise cash immediately, but defers the stock issuance potentially for years.

According to the FT report, Goldman Sachs would be in a strong position to win the Meta mandate considering Powell McCormick spent 16 years at the investment bank. The Wall Street bank led the Google deal announced this week. 

As noted above, Meta exces are conscious that they will have to move fast if they decide to raise equity to ensure capacity and investor enthusiasm remain amid a historic glut of activity in US public markets. SpaceX is set to raise as much as $86bn next week in an IPO that would value the group at $1.78tn. Claude maker Anthropic has confidentially filed for its own listing and rival OpenAI is also preparing to go public. Both are expected to raise tens of billions and attract $1tn-plus valuations.

Analysts say that Meta’s Big Tech rivals such as Microsoft and Amazon are also likely to be considering their own stock sales as their data centre spending surges and investors question the impact on their balance sheets.

Meta has already raised fresh capital through new means and innovative structures. The company had less than $10bn in long-term debt as recently as 2022, but borrowed $55bn in globe-trotting deals in recent months. In October, it raised $27bn in a bond sale through a joint venture with private capital firm Blue Owl to build a Manhattan-sized data centre in Louisiana dubbed “Hyperion”. Something we warned would soon become an off balance sheet template for all Mag 7s.

As a reminder, META is already neck deep in off-balance sheet debt. Here is a schematic of its $27.3 billion SPV with Blue Owl "Project Beignet" for the Hyperion data center. None of this touches META's balance sheet.

Expect hundreds of billions of these in 2026 https://t.co/794EgSiiZ9 pic.twitter.com/7hMyVW6Lno

— zerohedge (@zerohedge) January 29, 2026

Meta has also been conserving capital by cutting costs and other means. Last month it fired 8,000 people and stopped hiring for 6,000 roles.The company also halted share buybacks in late 2025 after repurchasing its shares regularly since 2017.

Google paused its buyback programme in the first quarter after repurchasing about $45bn last year, according to FactSet data and company filings.

Finally, those wondering why the Mag 7s are rushing to sell stock instead of do much cheaper debt offerings, we gave the answer exactly a month ago: "Banks Are Choking": The AI Debt Bubble Has Started To Burst.

Which only leaves equity sales, and just like that what went up in the past 2 months, is rapidly coming down. 

Tyler Durden Fri, 06/05/2026 - 15:40

Coinbase To Launch Token-Backed Mortgage Down-Payments This Summer

Authored by Turner Wright via CoinTelegraph.com,

Cryptocurrency exchange Coinbase will allow qualified borrowers to pledge digital assets to fund Fannie Mae-backed mortgage apartments beginning this summer.

In a Thursday notice, Coinbase and its partner, Better Home & Finance, said the mortgage structure plan launching “by summer 2026” will allow borrowers to initially use Bitcoin (BTC) or USDC (USDC) as collateral for loans to fund down payments for homes. The initiative, first announced in March, represented a significant shift in companies allowing digital assets to be used for financing houses. 

“We’re excited to expand access to all qualified borrowers to fix an ongoing issue: buyers who qualify on every measure that matters but cannot clear the down payment hurdle because their wealth isn’t where the system expects to find it,” said Better founder and CEO Vishal Garg.

Garg said in a March post on X:

“This isn’t a niche thing. It’s what everyone is going to do once most financial assets are tokenized. It’s just a better way to buy a house.”

The move by Coinbase and Better followed US regulatory agencies under the Trump administration being friendlier to crypto companies and more accepting of digital assets integrated with traditional finance. In June 2025, the US Federal Housing Finance Agency (FHFA) directed Fannie Mae and Freddie Mac to consider crypto as an asset in mortgage risk assessments without requiring a conversion into fiat.

Other mortgage lenders have made similar moves since the FHFA order. In February, Newrez began allowing borrowers to use their cryptocurrency holdings to qualify for a mortgage application.

Source: Bill Pulte

Volatile crypto-backed mortgages scrutinized for political motivations

Although the price volatility of cryptocurrencies like Bitcoin may present challenges to the mortgage plan, some US lawmakers have accused FHFA head Bill Pulte of being “unduly influenced” by President Donald Trump in supporting such policies.

“Expanding underwriting criteria to include the consideration of unconverted cryptocurrency assets could pose risks to the stability of the housing market and the financial system,” said five US senators in a July 2025 letter to Pulte following the FHFA order.

Republican lawmakers, including crypto proponent Cynthia Lummis, have proposed codifying the FHFA order into law. She introduced the 21st Century Mortgage Act in July 2025, saying government agencies “must evolve to meet the needs of a modern, forward-thinking generation.”

Tyler Durden Fri, 06/05/2026 - 15:40

 

 

Of all the dumb things Wall Street is infamous for, perhaps none is sillier than the all too regular forecasting game. Quarterly earnings, Non-farm payrolls, annual S&P predictions, oil prices, inflation rates, FOMC cuts — its a never-ending parade of predictions, most of which are laughable.

Guessing the revenues and profits of any company is tough enough; it becomes even more difficult for any company with only a few years of history.

Allow me to present to you Exhibit A in whatever subsequent litigation arises, via the WSJ:

“SpaceX’s revenue could reach $3.4 trillion in 2040, according to a Morgan Stanley analysis shared with top investors Thursday, according to people familiar with the matter.

Morgan Stanley told investors the rocket maker’s adjusted earnings before interest, taxes, depreciation and amortization in 2040 could top $2.7 trillion, the people said.”

I find it hilarious that anyone imagines they forecast revenues and/or profits a decade and a half into the future, let alone $3.4 trillion. Hey, you gotta move some shares, and this seems to be one way to accomplish that.

Just recall whatever you were thinking back in 2012 about 2026 (or the early 2010s about the mid 2020s)  — was Artificial Intelligence the top of your list? Intel finally rallying after the US government took a 10% stakle in it? Korea up 4X? GameStop / meme-stock short squeeze? Silicon Valley Bank / digital bank run? 500 basis point rate hikes in 2022? Did you anticipate the pandemic, the rise of EVs, the invasion of Ukraine, or either Trump elections? January 6, or October 7? A treatment/cure for Pancreatic Cancer?

The world is composed of countless co-variables — not only things we cannot predict, but also secondary effects and unforeseen consequences that are even more impossible to forecast — the further out you look, the number of possible outcomes increases exponentially.

So much happens over the course of a year that it makes forecasting challenging; 10-15 years into the future is utterly laughable.

Look, I get it, analysts’ jobs are hard enough as is, and many of them are justifiably terrified about being replaced by Claude.

Still, f*ckery tomfoolery like this does not give one confidence in this IPO process…

 

 

Previously:
Nobody Knows Anything (Archive)

Is SpaceX IPO Breaking Capitalism? (May 13, 2026)

The Folly of Forecasting (June 7, 2005)

 

See also:
SpaceX won’t make the S&P 500 (FT, June 5, 2026)

 

Source:
Morgan Stanley Sees SpaceX’s Revenue Reaching $3.4 Trillion in 2040
By Corrie Driebusch
WSJ, June 5, 2026

 

The post Nobody Knows Anything, SpaceX IPO edition appeared first on The Big Picture.

Ohio State University Reaches $100 Million Settlement With Nearly 300 Sex Abuse Survivors

Authored by Jasper Ward via The Epoch Times,

Ohio State University has reached a $100 million settlement with nearly 300 former students who had accused the school's campus doctor of sexually assaulting them decades ago, the school and a lawyer for the victims said on Wednesday.

The Ohio State University campus in Columbus, Ohio, U.S., November 25, 2020. Megan Jelinger/Reuters

The settlement with 279 of the 280 former students was ratified by the university's board on Wednesday. It followed years of litigation over accusations of decades of abuse by Richard Strauss.

The abuse occurred from 1978 to 1998, the year he retired from the faculty.

"The mediation and its confidentiality are continuing as the parties work to finalize the details of the settlements, and additional information will be shared as appropriate," the school and a lawyer for the victims said in a joint statement.

In February, the university reached eight additional settlements, bringing the total to 304 survivors and more than $60 million.

Strauss, who killed himself in 2005, was employed by Ohio State's athletic department and medical staff for nearly two decades.

A 2019 report detailing the investigative findings said that Strauss had sexually abused at least 177 men, nearly all of whom were students, and that university staff who knew of the abuse failed to act. The abuse included groping and fondling of the students' genitals and other acts under the guise of a medical examination.

News of the investigation and its findings prompted more than 500 plaintiffs to sue Ohio State, alleging they had been sexually abused by Strauss and that the school had shown deliberate indifference.

Tyler Durden Fri, 06/05/2026 - 15:00

Fannie, Freddie Jump After Trump Floats $1 Trillion Valuation

Fannie Mae and Freddie Mac shares jumped on Friday morning after President Trump said late Thursday that the mortgage giants were "probably worth $1 trillion," reviving Wall Street hopes for a long-awaited exit from government control.

President Trump praised FHFA Director Bill Pulte on Thursday for turning around Fannie Mae and Freddie Mac, saying the mortgage giants "probably have $1 trillion in value."

Full transcript:

"...a person who's got high integrity. He's done a phenomenal job at Fannie Mae, Freddie Mac. You probably have $1 trillion in value there. When he took over it was much less, and I guess I'm responsible for that too because everybody wanted me to sell it in my first term for 10% of what it's worth right now. If I would've sold it, we would've lost $900 billion. We would've lost. Think about it. It's probably worth $1 trillion. People want me to sell it at $100 billion — a very small percentage of what it's worth now. And he built up a lot. Did a great job. And it's an acting position. He is not going to be permanent because I don't think you'd want to be. But he was a smart guy. You may find out some things about the rigged elections, etc. etc. I think he wants to do it. He's got a lot of energy but will be very good. He's not a permanent position. We're looking at — we are interviewing people right now. But it is somebody just to take over for a little while."

.@POTUS on @pulte: "He's very smart. He's a person who's got high integrity. He's done a fantastic job... and it's an Acting position. He's not going to be permanent because I don't think he'd want to be permanent. But he's a very smart guy." pic.twitter.com/2wqOy7VtaS

— Rapid Response 47 (@RapidResponse47) June 4, 2026

Fannie and Freddie were both up in the early cash session, rising 5% and 3%, respectively. Shares in both mortgage giants tumbled earlier this week after Trump named Pulte as acting Director of National Intelligence, raising concerns that the dual role could delay the sale of the government's stake.

As of Friday morning, Fannie shares are down 34% YTD, while Freddie has slumped 38% YTD, as traders grow uneasy over the pace of the Trump administration's privatization plans. Optimism around potential share sales drove large gains in 2025.

Bose George, managing director at Keefe, Bruyette & Woods (KBW), wrote in a note, "We're comfortable with our most recently published numbers on the valuation—a current combined fair value in the $200–$250 billion range."

Related:

• Ackman Floats "Immediately Actionable" Blueprint To Free Fannie And Freddie

Christopher Maloney, mortgage strategist at BOK Financial, noted, "I don't believe I will ever see Fannie and Freddie released from conservatorship, at least not in my lifetime."

Tyler Durden Fri, 06/05/2026 - 14:00

University Of Oregon Grapples With Budget Crisis After Years Of Woke Excess

Authored by Jonathan Turley,

It appears that being unrelentingly woke means that you need fewer dormitories. The University of Oregon is facing a major budget crisis and will cut $65 million from its budget and close dorms due to low enrollment. That growing crisis, however, did not stop Oregon from burning almost a million dollars fighting against free speech. It also did not induce its faculty to offer greater intellectual diversity and tolerance to prospective students. Oregon is a cautionary tale for a generation of academic social warriors, but also an opportunity for those who want to restore balance in higher education.

Oregon has long been an example of academic orthodoxy. While most state schools begrudgingly yield to First Amendment demands and offer better free speech alternatives to private universities, Oregon is known as a hardened silo for the far left in teaching.

We previously discussed how Portland State University Professor Bruce Gilley, who was blocked from the Twitter account of the University of Oregon’s Division of Equity and Inclusion after tweeting “All men are created equal.” Oregon spent almost a million dollars fighting to bar such speech.

Such controversies have plagued the university for years, with no sign of self-examination by administrators or academics. The university was criticized for its monitoring of social media to punish errant thoughts or microaggressions. The law school’s law review was accused of anti-Israel discrimination.

The school previously gave special recognition to University of California (Santa Barbara) Professor Mireille Miller-Young, who criminally assaulted pro-life advocates on the campus of the University of California at Santa Barbara.  At the University of Oregon, she was honored as a featured speaker at the University of Oregon’s  Department of Women’s, Gender, and Sexuality Studies.  Part of its “black feminist speaker series,” Miller-Young’s work was highlighted by the College of Arts and Sciences and the Department of English to show “the radical potential of black feminism in the work that we do on campus and in our everyday lives.”

Now, the school is facing declining revenues and enrollments.

President Karl Scholz recently announced that this was due to lower out-of-state first-year enrollment, which means lower tuition revenue, increased costs, and a loss of grant funding.

Strangely, while closing dorms, the school is still building two new dorms.

Putting aside the school’s past budget judgment and discipline, the university’s reputation for intellectual orthodoxy deters many who do not want to pay tuition for their children to be indoctrinated or silenced.  Even with plunging trust in higher education, administrators and faculty cannot resist the temptation to exclude opposing voices.

Oregon is not the only school facing such shortfalls. Some woke institutions have closed entirely. The irony is that faculty would seem to prefer to see their institutions die than restore balance to their departments. However, this may offer a real opportunity for legislators and donors to force real changes in the culture of these schools.

As I have previously written, parents and students who value free speech must increasingly look to public universities where faculty are subject to constitutional guarantees. Public universities may be the final line of defense for free-speech advocates.

We now largely have two systems of higher education for those seeking education with a diversity of opinions and viewpoints. Except for outliers like the University of Chicago and other private universities holding the line on free speech, the orthodoxy found at private universities remains a barrier to many conservative and independent thinkers.

If we are to protect these bastions of free speech, legislatures will need to play a more active role in addressing the exclusion of both faculty candidates and speakers on public campuses. Too many faculty members continue to take the view that citizens are a captive audience expected to continue funding their departments, while excluding conservative or dissenting views held by many, if not most, citizens in a given state.

If faculty members want to continue maintaining echo chambers for their own viewpoints, they should have to seek private donors to sustain such intolerance and orthodoxy.

Legislatures can demand evidence that schools are maintaining intellectually diverse faculties in determining the level of continued support from citizens.

When some of us have argued for such campaigns, academics hypocritically claim that we are calling for political litmus tests or hiring based on political parties. It is an absurd argument that I have previously addressed, including in my book “The Indispensable Right: Free Speech in an Age of Rage.”

The call is for donors and legislators to withhold funding until they see real reforms, including greater diversity on faculties. They are not directing the hiring but looking at the results. The faculty members objecting to such calls have watched passively (or actively supported) the purging of conservative or libertarian faculty from universities and colleges.

When confronted by their own obvious ideological litmus tests, they shrug. Some acknowledge that their departments are overwhelmingly liberal, but insist that they just cannot find “competent” or “intellectually promising” conservatives. A few will admit that they do not believe that conservative views have a place in their departments.

It is impossible to deny the purging of faculties to create an academic echo chamber. If a large corporation effectively eliminated women or minorities while claiming no conscious discrimination, they would be trounced in court.

For years, I have raised concerns about the intolerance in higher education and surveys showing that many departments no longer have a single Republican as faculty members replicate their own views and values. There is no evidence that any faculty members (including those acknowledging the loss of virtually all faculty from the right of center) are honestly willing to reform their schools.

That ideological echo chamber is hardly an enticement for many facing rising tuition costs and relatively little hope of being taught by faculty with opposing views.

A Georgetown study recently found that only nine percent of law school professors identify as conservative at the top 50 law schools — almost identical to the percentage of Trump voters found in the new poll.

There is little evidence that faculty members are interested in changing this culture or creating greater diversity at schools.  In places like North Carolina State University a study found that Democrats outnumbered Republicans 20 to 1.

As college and university presidents face these shortfalls, it is time for legislators and donors to demand real proof of diversity in hiring and a change in the culture of these institutions. Otherwise, schools like Oregon will continue to close dorms as they push wokeness over wisdom.

Tyler Durden Fri, 06/05/2026 - 13:40

New Footage Reveals Ford Carrier Damage Far More Severe Than Pentagon Acknowledged

Newly surfaced footage obtained by CNN indicates that a severe fire aboard the USS Gerald R. Ford - the world's largest aircraft carrier - inflicted far more extensive damage than the Trump administration initially admitted to the public.

Early in the conflict it was forced to depart Mideast regional waters and retreat West in the Mediterranean, before undergoing extensive repairs at port in Croatia. Pundits were skeptical of official explanations, which suggested an accidental fire was sparked in the laundry room aboard the giant vessel.

US Navy file: Ford carrier

The major blaze erupted in March at a moment Iran claimed to have directly hit US naval vessels, but crisis was consistently downplayed by Pentagon officials at the time.

The obtained video reveals severely destroyed sleeping quarters, showing sailors' bunks entirely reduced to charred, twisted metal. The ceiling directly above the berthing areas appears completely gutted by the intense flames, while exposed wiring hangs from overhead and thick ash blankets the floor.

One sailor and eyewitness stationed on board the aircraft carrier told CNN: "I seriously thought we were going to lose the ship. It’s either fight or die."

This doesn't sound like some localized fire in a small compartment, but a massive emergency - which as we now now derailed the Ford's ongoing Iran mission in CENTCOM regional waters.

According to prior revealed details, it took the carrier’s crew approximately 30 hours of continuous damage control to fully extinguish the fire, clear out the wreckage, and importantly prevent the fire from reigniting. Some

600 sailors were displaced and left without access to their standard bunks, it had been revealed soon after the event took place.

⭕️ CNN Footage Reveals USS Gerald Ford Fire Was Far More Severe Than Pentagon Acknowledged

New footage obtained by CNN shows the fire aboard the USS Gerald R. Ford aircraft carrier two months ago was significantly more extensive than the Pentagon’s official account suggested,… pic.twitter.com/Ycew0G2h3y

— Drop Site (@DropSiteNews) June 5, 2026

While the definitive cause of the fire remains unclear, Tehran has claimed responsibility, asserting it successfully targeted the premier American aircraft carrier.

Again, this has fueled widespread speculation that the Iranian account could be accurate, given the Pentagon is known to have downplayed other instances where significant military hardware came under fire.

Prior reporting has also underscored that the blaze actually hindered combat operations against Iran. The incident has been confirmed to have resulted in a complete halt to two days of combat operations. Chief of Naval Operations Adm. Daryl Caudle, had described two months ago, "They fought that, put it out, and started flying sorties two days after that, so I’m very proud of that crew."

Tyler Durden Fri, 06/05/2026 - 12:40

Morgan Stanley Projects SpaceX Revenue Hitting Stratospheric $3.4 Trillion In 2040, $2.7 Trillion In EBITDA

Yesterday we shared a forensic analysis of the mechanics of the $75 billion SpaceX IPO and how to trade it, while specifically saying we are leaving the fundamentals aside. The reason for that is that the historicals of the company are, to put it mildly, problematic when it comes to projecting how the company grows into a multi-trillion behemoth. 

As a reminder, SpaceX posted revenue of just under $20 billion for the LTM period, with approximately $6 billion EBITDA and loss of $4 billion, virtually all driven by the conglomerate's Connectivity (Starlink) division and to a lesser extend, the Launch Services division. Solid numbers on their own, but do they justify a $1.75 trillion in valuation?

So how exactly does SpaceX get from here to there? 

We got the answer this morning courtesy of the WSJ which got its hands on an analysis shared by Morgan Stanley with top investors. 

Needless to say, to support the $1.77 trillion valuation Elon Musk’s SpaceX is targeting in its IPO, bankers are telling investors to look to the future.... far into the future. 

Morgan Stanley projects that SpaceX’s revenue could reach $3.4 trillion in 2040. The bank told investors the rocket maker’s adjusted EBITDA in 2040 could top $2.7 trillion, or a largely unheard of 80% EBITDA margin.

Some more details: the WSJ also notes that sellside analysts at Goldman Sachs and Morgan Stanley both projected SpaceX’s revenue would be near $160 billion in 2028, up from $20 billion currently. Goldman estimated that the rocket company’s revenue would exceed $470 billion in 2030, while Morgan Stanley projected it would reach nearly $330 billion. Goldman and Morgan Stanley expect SpaceX to have adjusted EBITDA of around $110 billion in 2028 and $352 billion and $230 billion, respectively, in 2030. 

Using these data, we have charted how SpaceX revenue and EBITDA would have to grow (assuming a 2028 baseline of $160BN in revenue and $110 billion in EBITDA). The projection is... aggressive.

To get to those stratospheric - no pun intended - levels, both banks anticipate revenue from SpaceX’s AI business to provide the bulk of the revenue after this year and grow dramatically. Goldman projected that unit would contribute around $322 billion in 2030, while Morgan Stanley projected around $190 billion that year. SpaceX reported revenue from its nascent AI division of $3.2 billion in 2025.

How realistic are these assumptions? Some thoughts from Brandon Carl, who writes that the MS forecast would require 14% US GDP growth over 14 years . The long-term average is 6.5%.:

"Most Successful Company Ever" Assumptions

• SpaceX commands 5% of US corporate profits
• Corporate profits become 15% of GDP, by far a record

Implications

• Total US corporate profits = $54 trillion
• US GDP = $205 trillion
• 14 year US GDP growth rate = 14%

"Still Aggressive" Assumptions

• SpaceX commands 2% of corporate profits
• Corporate profits are 10% of GDP, historically high
• Then US GDP = $770 trillion growing at 26%

Assume that EBITDA is about 1.75x profits, so profits = $1.54 trillion.

Goldman and Morgan Stanley are certainly redefining the hockeystick when it comes to the SpaceX IPO: the two banks snagged the top two roles out of the 21 banks on SpaceX’s IPO, putting their banks in line to get the biggest shares of the hundreds of millions of dollars of fees. Which is why if for whatever reason the IPO bombs or fails to launch they stand to lose the most.

So will people "buy" these ludicrous projections? Well, according to Bloomberg, with one week left to go until the actual IPO, the offering is already oversubscribed.

• *SPACEX IPO IS SAID TO DRAW MORE ORDERS THAN SHARES AVAILABLE

This means that the deal will almost certainly price at Musk's desired offering price of $135. What happens after that is anyone's guess. 

Tyler Durden Fri, 06/05/2026 - 12:05

Micro-Cap 'War Unicorn' Merlin Soars After Advancing AI Pilot For C-130 Military Plane

Aerospace and defense technology firm Merlin jumped in premarket trading after announcing that its AI-powered autonomous flight software for the C-130J Super Hercules cargo plane, developed with U.S. Special Operations Command, is moving toward formal testing.

Merlin wrote in a press release earlier that its AI-powered autonomous flight software has "successfully completed" the critical design review for the C-130J, adding the "milestone positions the program to enter a structured formal test campaign, including aircraft-level testing, reflecting a disciplined systems engineering progression from design through verification."

The Merlin AI Pilot will automate flight operations for the C-130J from takeoff to touchdown and is framed as an "operating system" for autonomous aviation.

Merlin has completed the Critical Design Review for its C-130J autonomy program with @USSOCOM. CDR is the milestone where our government customer reviews the detailed design of the system and accepts it is mature enough to move toward the aircraft. We cleared it.

Learn more… pic.twitter.com/8OgM9H5it8

— Merlin (@MerlinAero) June 4, 2026

The C-130 is the workhorse cargo plane of the U.S. military. The upgraded version, by slapping a "J" on the end, includes:

• Newer turboprop engines

• Six-blade composite propellers

• Digital cockpit and avionics

• Reduced crew requirements

• Better range, climb, speed, and fuel efficiency than older C-130s

Shares of the micro-cap defense company jumped 28% in premarket trading.

Merlin also pointed out that it is "rapidly advancing its AI-powered autonomy stack onboard the C-130J, with potential pathways for expansion across other Department of War or commercial aviation platforms."

The rise of "war unicorns" has been an important theme this year as the Department of War resets its procurement program toward startups and away from big legacy primes.

Goldman analysts also recognize the rise of defense startups and sat down with Palmer Luckey's Anduril earlier this week. Read the note here.

Tyler Durden Fri, 06/05/2026 - 11:50

The post Friday Morning Book Review: Cancelling Billionaires: The Urgent Case for a Wealth Tax appeared first on CEPR.

ISS Astronauts Told To Prepare For Possible Evacuation As Air Leak Worsens

NASA senior adviser and press secretary Bethany Stevens wrote on X that astronauts aboard the International Space Station have quickly shifted into SpaceX's Dragon spacecraft and are prepared to evacuate if needed, after cracks and leaks in the Zvezda service module transfer tunnel appeared to worsen.

"The Zvezda service module transfer tunnel, known as PrK, has suffered from cracks and leaks for some time, and has been mitigated by Roscosmos as much as possible to date. The cracks have always been a concern that NASA watches very closely," Stevens said.

According to NASA, the Zvezda service module is 43 feet long and contains living quarters, life support systems, communications systems, electrical power distribution systems, data processing systems, flight control systems, and propulsion systems.

The Zvezda service module transfer tunnel, known as PrK, has suffered from cracks and leaks for some time, and has been mitigated by Roscosmos as much as possible to date. The cracks have always been a concern that NASA watches very closely. NASA and Roscosmos have been working…

— Bethany Stevens (@NASASpox) June 5, 2026

Stevens continued, "The cracks have always been a concern that NASA watches very closely. NASA and Roscosmos have been working to determine the root cause of the cracks, and Roscosmos manages the issue through operational mitigation measures and periodic partial-repair efforts."

Out of caution, NASA ordered all four SpaceX Crew-12 members, along with NASA astronaut Chris Williams, to be on high alert inside Dragon during the repair.

NASA said it continues to work with Roscosmos and other station partners toward a more permanent fix for the long-running issue.

Reuters cited a senior NASA official who said the air leak has been monitored over the last few months but significantly worsened earlier this week, increasing from a loss of one pound of air per day to two pounds per day.

Tyler Durden Fri, 06/05/2026 - 11:20

The Atomic Crab

By Benjamin Picton, senior market strategist at Rabobank

The Atomic Crab

The Dow Jones hit a fresh all-time high yesterday, surging 1.73% to close at 51,562. The S&P500 posted more modest gains while the NASDAQ closed slightly lower as investors rotated out of some growth-oriented tech names and back towards healthcare and financials with more of a value or cyclical flavor.

Treasuries traded in a narrow range to close with yields little changed, while European sovereigns mostly saw modest declines in yields with the slightest hint of bull steepening evident in some curves. The Bloomberg Dollar spot index was down slightly but is inching higher again in early trade this morning.

Oil markets continue to be a point of focus. Front-month Brent futures closed 2.84% lower yesterday as markets remain of a Pollyanna state of mind over the status of the Strait of Hormuz. Dated Brent went the other way to post a (very) small gain yesterday after a 3.61% lift on Wednesday. The Singapore gasoil for spot delivery index was down 4.45% to $136.57/bbl.

Scuttlebutt over the status of US-Iran peace talks continued to dominate headlines yesterday. Following Donald Trump’s announcement of a Israel/Lebanon ceasefire that was contingent on Hezbollah ceasing its attacks on Israel we had confirmation this morning that Hezbollah has no intention of halting strikes. Hezbollah leader Naim Qassem made a statement on Thursday saying that “as long as the occupation exists, the resistance will continue” and calling the negotiations between the Lebanese government and Israel “absurd, humiliating and shameful.”

For Israel’s part, defence minister Katz has said that Israeli attacks in Southern Lebanon will continue and that the IDF will maintain “freedom of action” including in Beirut – which has been a red line for the Americans. Benjamin Netanyahu has recently faced criticism at home for being seen to be too compliant with American demands over strikes in Lebanon. Netanyahu faces an election in October, which polling suggests he may lose. Peace on all fronts was an Iranian condition precedent for reopening Hormuz and commencing the 60-day nuclear talks, but it seems that neither belligerent is interested.

Meanwhile, Donald Trump’s language on the Iran peace talks has gone from “deal imminent”, to “a deal soon, maybe” to “actually, we really don’t need a deal”. Trump showed signs of crabwalking away from a key demand that Iran hand over its stockpile of highly enriched uranium by saying that he does not need a deal with Iran to secure the uranium, but that there was no reason to send US troops into Iran to do so because the uranium is “entombed”.

Regular readers will recall that RaboResearch updated our Iran war baseline forecast two weeks ago to say that we didn’t think a meaningful deal would stick in the short term, and that the Strait of Hormuz would consequently remain functionally closed until September at least. The incompatibility of the two parties’ nuclear demands was a key factor in this judgement, so it is significant that Trump is now showing hints of softening his position on this point. However, capitulation on the highly enriched uranium or the limits of Iran’s nuclear enrichment program shifts the needle back towards US strategic defeat, with potentially grave consequences for all who have prospered under 80-years of Pax Americana.

We noted here yesterday that Bloomberg had reported that the IAEA had published a restricted document arguing that the nuclear risk posed by Iran is now higher than it was prior to the war. Subsequently, Bloomberg has reported that Iran has permitted IAEA monitors to inspect its Bushehr nuclear plant within the last week, but that Iran has steadfastly refused to comply with requests to verify the condition and location of its highly enriched uranium.

Needless to say, while the US-Iran stalemate continues global oil and oil products stocks continue to run down towards dangerously low levels. Vitol board member Tom Baker recently said that the oil trader estimated global demand destruction at about 4 million barrels a day, mostly from emerging Asia and Africa. China alone has reportedly reduced daily imports by close to 4 million barrels, while strategic reserve releases coordinated by the IEA have also been running close to 4 million barrels a day.

It’s not entirely clear whether or not there is some double counting in the Vitol estimates and China import drop-off, but the back of the napkin calculation gets us somewhere close to the ~12mbbl/day estimated supply loss from the Hormuz closure, and goes some way toward explaining why oil prices have remained remarkably low. Nevertheless, this remains a stocks to flows problem, and the cracks cannot be papered over indefinitely without supply tightness also being felt materially in developed markets.

While China’s reduction in oil imports helps planet earth rebalance energy flows, movements are afoot in Australia to counter Chinese monopsony power over the iron ore trade. China recently formed the state-owned China Mineral Resources Group to coordinate purchases of iron ore cargoes for China’s steel industry and exert market power to ensure that suppliers are paid in CNY, rather than USD. Australian firms supply more than 50% of global iron ore, but those firms have seen their market power eroded by alternative supply coming online in west Africa and an inability to coordinate to counter Chinese market power.

The Australian Financial Review this morning reports overtures from iron ore majors to the Australian government to counter monopsony buying power and give producers more say over how much they are paid and in which currency. Could we see state-backed single desk iron ore marketing in the land down under? Australia’s second-closest neighbour Indonesia recently did just that for coal, palm oil and ferroalloys, and has the world’s largest reserves of nickel – a critical input for Chinese stainless steel and EV battery production.

Elsewhere, there are again renewed hopes for peace prospects in Ukraine as Kyiv’s long-range drone strikes continue to cause havoc deep inside Russia. Vladimir Putin’s St Petersburg International Economic Forum (a kind of Davos for dictators) was recently interrupted by Ukrainian drone strikes on nearby Russian oil infrastructure – prompting Putin to vow that Russia will bolster its defenses against Ukrainian air attacks.

At the same time, Russia’s spring/summer offensive appears to have stalled and news outlets are reporting that Putin is signalling openness to a compromise on Ukraine in line with discussions held with President Trump in Alaska. Putin says that Ukraine needs to accept those compromises, but might there be some wiggle room for Ukraine to extract a better deal given the changed battlefield calculus? For his part, Zelenskyy is pushing for face-to-face talks with Putin to reach peace terms, but Putin says that he will only meet once terms have already been agreed, and that he will only meet in a neutral third-party country, which rules out EU member states in his view.

Tyler Durden Fri, 06/05/2026 - 10:55

"Stocks Should Go Up, Not Down": Trump Rages At Market Reaction To 'Great' Jobs Report

Global capital markets are a mess following this morning's hotter than expected rise in US employment.

Nasdaq is down 2%...

Yields are spiking dramatically...

The dollar is rampaging higher...

And Gold (and bitcoin) are getting clubbed like a baby seal...

All of which prompted President Trump to exclaim that "stocks should go up, not down" on the back of a strong jobs report:

It appears the President has not been watching for the last couple of decades as The Fed has become a mainstay and 'good' news removes their pillar of support...

...meaning 'bad' news for stocks.

Tyler Durden Fri, 06/05/2026 - 10:40

Goldman, JPM Block China, Hong Kong Investors From SpaceX IPO

SpaceX's institutional roadshow kicked off Thursday, with JPMorgan CEO Jamie Dimon hosting a "live interactive discussion" for ultra-wealthy clients across 90 JPM locations in 26 states. Shortly after, SpaceX's IPO slide deck was made public, likely in a bid to supercharge retail demand for what could be the largest public listing in history. However, one key investor pool appears to be shut out: China and Hong Kong.

Bloomberg News reports that SpaceX's underwriters have blocked investors in China and Hong Kong from participating in the company's planned IPO, citing regulatory and compliance concerns.

Goldman Sachs and JPM, the lead banks managing the $75 billion offering, instructed syndicate members not to accept orders from China- and Hong Kong-based customers, including private banking clients.

In total, SpaceX plans to sell about 555.6 million shares at a price of $135 per share, which would net the space, rocket, AI, and defense company $75 billion. The valuation appears to be set at around $1.8 trillion.

There were reports earlier this morning that SpaceX's IPO website and slide deck were inaccessible in China and Hong Kong.

Important read here: We laid out a deep dive for readers on the SpaceX offering and how to trade what could become the world's largest IPO. This was followed by Goldman's report questioning whether markets can absorb the massive supply from the coming IPO wave.

First up is SpaceX next Friday, with the chatbot makers likely in the back half of the year.

Tyler Durden Fri, 06/05/2026 - 10:20

Iran Oil Exports Plunge To Four Year Low As Blockade Tightens, While Inflation Soars To World War 2 Levels

If it was indeed Trump's intention to starve Iran's economy of oil export revenue, the plan may just be working: Iran's oil exports fell to their lowest level in at least six years in May as the US naval blockade has succeeded in choking off crude shipments and leave tens of millions of barrels stranded at sea.

According to shipping data from Vortexa, Iran exported just 209,000 barrels per day of crude oil and condensate in May, down from 1.34 million bpd in April and nearly 1.9 million bpd in March. Kpler had estimated May exports slightly higher at 260,000 bpd, but still the lowest level since the height of the Trump administration's "maximum pressure" campaign in 2019-2020.

When the blockade first took effect in April, analysts expected Tehran to lean on floating storage while waiting for an opportunity to move barrels, which it did with ease as it had control of the strait thanks to its own blockade (much to our surprise, as we asked back in early March why the US didn't do the same). But storage is no longer growing. According to Kpler, floating inventories have fallen from roughly 190 million barrels in late April to about 147 million barrels today as cargoes continue trickling into China and production slows.

Meanwhile, another problem for Tehran is that China's appetite for oil is not only not growing, it is crashing just as Iran needs buyers most (see "Traders Puzzled As Physical Oil Prices Tumble Amid Surging Chinese Crude Sales, Plunging Imports"). 

Independent Chinese refiners have begun cutting processing rates amid weak margins and comfortable fuel inventories, reducing demand for sanctioned barrels.

That shift has already pushed Iranian Light crude from a premium to a discount. As Reuters notes, plunging demand from Iran’s top crude buyer, China, has dragged Iranian flagship oil prices into discounts to ICE Brent for the first time in two months, trade sources told Reuters on Thursday, noting that Iranian Light crude is offered at discounts ranging from $0.50 to $1 per barrel to ICE Brent for delivery in June into the province of Shandong, the home of the teapots. As recently as a month ago, Iranian Light cargoes were sold at premiums of $1–2 per barrel over ICE Brent in April and May.

Meanwhile, roughly 67 million barrels of Iranian crude and condensate remain stranded inside the Gulf and Gulf of Oman, according to Kpler estimates.

Worse, analysts say time may be running short. Kpler's Homayoun Falakshahi warned that if the blockade remains in place for another two months, Iran could effectively run out of available oil to ship to China.

The market implications extend beyond Iran. Every barrel removed from export markets tightens an already strained global supply picture at a time when Middle East disruptions have already slashed regional exports. For now, fewer tankers leaving Iran means fewer barrels reaching buyers. Eventually, it will mean fewer barrels being produced.

But the implications certainly also impact Iran, whose economy is now imploding, as a decline of 1 million barrels from the 1.3 million April daily average translates into a roughly $80 million drop in export revenues per day, or $2.5 billion per month, which Iran's IRGC leadership no longer collects to control the population and the local army.

As a result, inflation in Iran reached a level in May unseen since World War II, underlining the economic pain average Iranians face as the Islamic Republic worries about the war with Israel and the United States restarting.

A report Monday by Iran's Central Bank represents the first official acknowledgment of what Iranians shopping, paying for a taxi or visiting a medical clinic already know: The rial currency is being crushed by the war and uncertainty around it resuming. 

Iran's Central Bank said the consumer price index reached 77.2% in May compared to the year before. It added the rate is 8.5% higher than in April. Inflation in daily and general needs - like medicine, taxi fares, tobacco and communication fees - rose 113.8% from the year before. May as well call it hyperinflation: the rial, which traded at 32,000 to $1 in 2015, now trades at over 1.7 million to $1.

“We will definitely have higher prices," Iranian President Masoud Pezeshkian warned in May. "We are fighting and we must accept this hardship.”

Iran only saw worse inflation in 1942 during World War II, sparked by the British and Soviets invading the country and taking over its railway, disrupting food supplies. The lack of food, worsened by a poor harvest, sparked hyperinflation and a famine. Hunger and a typhus outbreak killed many.

A private economic think tank in Iran, the Bamdad Institute of Economic Studies, described the current figures as “an unprecedented rate since World War II.” Iran's Central Bank did not acknowledge the significance of the figures.

Which begs the question: is Iran about to have another round of violent protests? In 2017 into 2018, soaring food prices sparked demonstrations that killed over 20 people and saw hundreds arrested. An increase in government-subsidized gasoline prices caused protests that saw over 300 people reportedly killed.

Then came the protests over the rial at the start of this year, the most intense demonstrations to shake the Islamic Republic since its 1979 revolution and chaotic years that followed.

Tehran-based economist Saeed Leilaz, speaking to The Associated Press, warned that annual inflation in Iran could reach 80%.

"Iran’s society cannot tolerate above 25%” annual inflation, he warned. 

Tyler Durden Fri, 06/05/2026 - 09:45

ZEC Crashes As Zcash Admits 'Critical Counterfeiting Vulnerability' Exposed By Claude

Authored by Martin Young via CoinTelegraph.com,

The price of ZEC fell on Thursday after further details were disclosed of a critical counterfeiting vulnerability in Zcash’s Orchard pool that could theoretically allow a bad actor to mint an unlimited amount of ZEC.

According to a post on X, security engineer Taylor Hornby, who was engaged by Shielded Labs, discovered the bug on May 29 and disclosed it to the Zcash Open Development Lab (ZODL), which deployed an emergency response to fix the vulnerability with a hard fork activated on June 3. 

However, there are new concerns about the extent to which the vulnerability, which has existed since May 2022, has been used, leading Zcash to fall more than 30% over the past 24 hours to $410 at the time of writing. Its market capitalization has shrunk by more than $3 billion.

However, BitMEX co-founder Arthur Hayes said on Friday it is unlikely that ZEC has been illegally minted this way, though he acknowledged “it cannot be formally cryptographically proved impossible.”

“Sadly, due to the Orchard Pool exploit, I had to dump our entire ZEC bag,” he said.

“The Holy Trinity is dead,” he added, referring to Zcash and the two other tokens he sold this week, Hyperliquid (HYPE) and Near Protocol (NEAR).

ZEC crashes almost 50% in 24 hours after two months of solid gains. 

Claude assists in bug discovery 

Taylor used Claude Opus 4.8, which was released on May 28, a day before the discovery, to assist in a highly targeted review of the Orchard circuit, the cryptographic component underlying Zcash’s Orchard shielded pool.

The critical bug allowed false inputs into an elliptic curve multiplication check, which means the math that is supposed to cryptographically verify transactions could be fooled.

Taylor built and tested a working exploit, which generated unlimited counterfeit ZEC. 

“If he had run the same tool on Zcash mainnet it would have generated unlimited, undetectable counterfeit ZEC in his mainnet Zcash wallet,” the security researchers said on Friday. 

The primary concern is that there is no cryptographic way to prove whether anyone had previously exploited it before it was patched, due to Orchard’s privacy properties. 

However, Shielded Labs was “not overly concerned” because the bug was subtle enough to evade years of expert review, and the discovery was a deliberate, highly skilled effort using cutting-edge tools and AI.

The firm is working with Zcash developers on a proposed network upgrade to allow anyone to verify the integrity of the ZEC supply and to prove the nonexistence of counterfeit tokens in the Orchard pool, they stated. 

Not the first counterfeiting vulnerability for Zcash

Mert Mumtaz, co-founder and CEO of Solana tooling firm Helius, said that almost all privacy protocols have a variant of this same vulnerability. 

“This same FUD comes back every five months as new people learn how privacy pools work,” he said. 

He explained that it is a theoretical risk in most zero-knowledge privacy protocols from circuit bugs that are hard to exploit or detect.

This is not the first time a similar vulnerability in Zcash has been discovered. In 2018, a counterfeiting vulnerability in the cryptography underlying zk-proofs was discovered by the Electric Coin Company, which remediated it with no losses in 2019. 

Tyler Durden Fri, 06/05/2026 - 09:20

Demented NY Dems Erase "Mother" From State Law, Replace Her With "Gestating Parent"

Authored by Steve Watson via Modernity,

Latest nonsense targets family courts, custody, and parental rights

Outrage is exploding after New York Democrats rammed through legislation that strips the words "mother" and "father" from key sections of state law and replaces them with cold, clinical inventions: "gestating parent" and "non-gestating parent."

Yes, really. They're pushing for the erasure of biological motherhood and fatherhood in the name of activist ideology.

The bill passed the Assembly months ago and cleared the Senate this week with minimal debate. It now sits on Governor Kathy Hochul's desk. If she signs it, the changes take effect November 1 and will rewrite references across family court proceedings, domestic relations, child support, custody determinations, and even education statutes. "Paternity" becomes "parentage." "Putative father" becomes "alleged parent."

? NOW: Outrage erupts as New York passes legislation to REMOVE the word "mother" and replace it with "gestating parent"

WTF?!!?

New York Democrats are total psychos.

This is a war on women! pic.twitter.com/guNUkmNx6h

- Eric Daugherty (@EricLDaugh) June 4, 2026

Sponsors Sen. Luis Sepulveda and Assemblywoman Amy Paulin packaged the overhaul as a long-overdue update to parentage laws. The memo claims the new language simply aligns statutes with existing court rulings and accommodates surrogacy arrangements plus same-sex parenting.

In practice, every traditional reference to mothers and fathers in these legal contexts gets replaced. The language is deliberately stripped of sex-based meaning. Motherhood is reduced to a temporary biological process. Fatherhood is defined by its absence from gestation.

Democrats and allied lawyers argue the old terms were outdated the moment same-sex couples and surrogates entered family court in larger numbers. They insist the rewrite creates consistency and avoids confusion in complex modern cases.

Republican and conservative leaders wasted no time labeling the move what it plainly is: ideological overreach dressed up as progress.

State Conservative Party Chairman Gerard Kassar called it "woke culture run amok" and pure one-upmanship that wastes legislative time while the state budget remains stalled.

Republican gubernatorial candidate Bruce Blakeman was even more direct, charging that Democrats led by Hochul have "declared war on families" by canceling "Mom and Dad."

State Sen. Patricia Canzoneri-Fitzpatrick and U.S. Rep. Claudia Tenney both highlighted the grotesque misplacement of priorities. While New Yorkers face crushing taxes, failing schools, and public safety failures, Albany chose to spend its final days neutering the language of motherhood.

Even some rank-and-file Democrats reportedly viewed the bill as unnecessary. Hochul herself claimed she was unfamiliar with it when asked and said she would "take a look." For the woman who styles herself the state's "first mom governor," the dodge was telling.

This latest New York push is not happening in a vacuum. Similar efforts to strip "mother" and "father" from official language have surfaced repeatedly in Democrat strongholds and taxpayer-funded institutions.

In Wisconsin, Democrat Governor Tony Evers tried to insert language into the state budget bill that would replace "mother" with "inseminated person" and "biological father" with "natural parent" in contexts involving paternity disputes and artificial insemination.

Other proposed swaps erased "woman," "female," "wife," and "husband" entirely. Critics correctly described it as beyond parody and a direct insult to every actual mother in the state.

This turgid trend is far from limited to the US. A government-funded Scottish charity called Scotland's International Development Alliance produced an official "inclusive language guide" that explicitly branded the words "mother" and "father" as "oppressive."

The guide instructed users to replace them with neutral terms like "parent" or "guardian" and framed traditional family language as something that reinforces unwanted power structures. Taxpayer money supported the entire project.

New York's "gestating parent" and "non-gestating parent" formulation follows the identical script. What began as fringe suggestions in activist guides and budget amendments has now advanced to actual state law in one of America's largest blue states.

This is coordinated ideological creep. Each step tests how much biological reality the public will accept being rewritten out of existence.

Women who carry and birth children will still be mothers in every meaningful sense. The law cannot change that biological fact. What the law can do is remove any formal recognition of that reality in the places where recognition matters most: custody disputes, parental rights, and official records.

Surrogacy and same-sex parenting arrangements can be accommodated with precise legal definitions without requiring the rest of society to pretend motherhood is a neutral administrative function. The bill does not solve a genuine legal problem. It manufactures one to satisfy a narrow ideological demand.

This is the same mindset that insists men can become women, that sex is assigned rather than observed, and that dissent from any of it constitutes bigotry. It is the systematic replacement of observable truth with preferred fiction.

New York Democrats are not leading on this issue. They are following the same script playing out in other blue strongholds: rewrite language, capture institutions, then punish anyone who refuses to comply. The speed and lack of serious debate around this bill show how normalized the project has become inside the party.

Governor Hochul still has time to veto this bill. If she signs it, she will own the decision to erase "mother" and "father" from New York law. Either way, the voters who actually care about protecting women, children, and the English language now have a clear marker of which party treats biological reality as optional.

Tyler Durden Fri, 06/05/2026 - 09:00

Globalist CEOs Sound Alarm Over Swiss Population Cap Vote

Summary: 

• Increasing Number of Globalist CEOs Concerned About Swiss Population Vote

• Nestle CEO Warns Against Swiss Population Cap Vote

• UBS CEO Warns Swiss Population Cap Is An 'Extreme' Measure

• Switzerland's "Ten Million" Vote Nears 

Nestle CEO Warns Against Swiss Population Cap

Globalist CEOs who ignored more than a decade of Europe's mass migration invasion from the third world because it was good for business may soon face headwinds from Swiss voters: a June 14 referendum that would cap the country's permanent resident population below 10 million through 2050.

Nestlé CEO Philipp Navratil is the latest to warn Swiss citizens that a vote to cap the population at 10 million would not be good for business.

"Switzerland has established and created the conditions that enable a global company like us to thrive," Navratil said at the Swiss Economic Forum in Interlaken on Friday, who was quoted by Bloomberg. 

"It is important that these conditions and advantages in Switzerland remain in place. When we vote in the coming weeks, we need to keep that in mind," Navratil added.

Navratil's comments come just days after UBS CEO Sergio Ermotti called the hard-cap vote an "extreme initiative."

The proposal has received strong support in many local polls, though the latest polling data puts opposition just north of 50% for the first time.

Switzerland's population is already above 9.1 million, and estimates suggest migration would need to fall by at least half to avoid hitting the proposed ceiling by 2050.

Yet while these globalist CEOs found no issue with a decade of extreme mass migration from the third wolrd world into Europe, everyday working-class people have borne the brunt of the consequences.

UBS CEO Warns Swiss Population Cap Is An 'Extreme' Measure

A proposal headed for a June 14 vote in Switzerland made headlines for seeking to place a hard cap on the country's permanent resident population at 10 million through 2050.

The vote is also being watched as a referendum on immigration pressure in Europe more broadly. UBS CEO Sergio Ermotti has caught the vapors over the idea, describing it as an "extreme" measure that fails to address the country's underlying challenges.

UBS CEO Sergio Ermotti (photo: Chiara Zocchetti )

"I do worry about these extreme initiatives," Ermotti said, speaking from the Swiss Economic Forum in Interlaken on Thursday. "Switzerland has 30% of foreign-born people, almost like in Australia, twice as Germany. And that leads to certain frustration within society. But it's not a way to solve the problem."

Switzerland's population stood at approximately 9.1 million at the end of 2025. Since 2000, it has grown by about 1.9 million people, with roughly four-fifths of that increase attributable to net international migration. Swiss federal authorities measure the increase since the introduction of free movement of persons in 2002 at around 1.7 million.

Foreign nationals now make up about 27% of the resident population, while migration-background shares are higher. In 2024, 41% of Switzerland's permanent resident population aged 15 and over had a migration background, including first-generation and second-generation residents. Ermotti highlighted the scale of the demographic shift, noting that Switzerland's foreign-born share is comparable to Australia's and roughly double Germany's.

The "No to a Switzerland with 10 Million" initiative, backed by the right-wing Swiss People's Party (SVP), would enshrine a hard population limit in the Federal Constitution. If passed, it would require Switzerland's permanent resident population to remain below 10 million until 2050. If the population exceeds 9.5 million before then, the Federal Council and Parliament would have to take measures, particularly in asylum and family reunification.

If the 10 million threshold is exceeded, Switzerland would also have to renegotiate or terminate international agreements that contribute to population growth, including the EU Agreement on the Free Movement of Persons after two years. That would also put the broader Bilateral Agreements I with the EU at risk. Supporters point to real pressures: housing shortages and rising rents in cities like Zurich and Geneva, strained infrastructure, overcrowded public transport, and concerns over long-term social cohesion in a small, mountainous nation.

UBS's High Stakes In The Debate

UBS, one of Switzerland's largest private-sector employers with more than 30,000 employees in the country and a heavily international workforce, has significant skin in the game. The bank relies on global talent to sustain its operations in finance, a sector where skilled foreign workers fill critical roles. A rigid population cap, critics including business leaders argue, could exacerbate labor shortages in an already aging society with a fertility rate of around 1.3 children per woman.

Ermotti's comments come as Switzerland grapples with balancing economic dynamism against quality-of-life concerns. Opponents of the cap, including the Federal Council and business groups, argue that Switzerland needs foreign workers in companies and public institutions such as hospitals and care homes, and that a constitutional ceiling would create uncertainty around Swiss-EU relations. Recent net immigration has moderated somewhat, falling for a second consecutive year in 2025, but remains high by historical standards.

The UBS chief stressed the need for evidence-based policymaking. "The discussions need to be balanced," he said, urging authorities to ground decisions "on fact rather than emotion and scaremongering."

Parallel Battles Over Capital Rules

Ermotti's remarks on the population initiative coincided with ongoing tensions over Switzerland's proposed capital requirements for UBS. The government is pushing to increase the common equity capital UBS must hold domestically against its foreign operations to 100% of each unit's equity value, from 60% currently. The bank estimates this would require an additional roughly $20 billion in CET1 capital for its Swiss entity, a move it warns would damage its business model and, by extension, the broader domestic economy.

Parliament continues to debate the core package, with the process expected to last until next year. Ermotti's call for fact-based deliberation applies equally here, as the bank awaits clarity on reforms that were partially watered down in April but remain demanding.

A Defining Moment For Swiss Identity And Economy

The referendum remains contested, though the latest reported polling shows opposition ahead, with 52% against the initiative and 45% in favor. It taps into broader European debates over low native fertility, labor needs, infrastructure limits, and national character. Switzerland's direct democracy hands the ultimate choice to voters, making the outcome a potential bellwether for how high-income nations navigate sustained immigration.

Tyler Durden Fri, 06/05/2026 - 08:47

Futures Drop On Souring Chipmaker Sentiment, Kospi Plunge

Futures are lower amid fresh underperformance of tech. If the premarket weakness persists, the S&P 500 is set to break a historic weekly run of gains as the AI trade takes another leg lower this time driven by the cartoonish Kospi index, with investors also expecting payrolls data to affirm that interest rates will stay higher for longer (full payrolls preview here). As of 8:00am ET, S&P futures are down 0.5% while Nasdaq futures slide 1% as chipmakers fall and big tech stocks are lower too, following on from a slump in South Korea’s Kospi. All Mag 7 names are all lower in premarket trading except for MSFT (+0.4%); NVDA fell -1.3%, a continuation of yesterday’s underperformance post AVGO earnings. On news flow, headlines were mostly muted this morning; after yesterday’s non-tech led rebound, we saw more negative sentiment this morning with all three indices lower during the pre-market session. Bond yields are flat to lower, the 10Y yield trading unchanged at 4.47% lower; the USD is also lower. WTI crude fell -0.2% to $92.86; both base and precious metals are lower while the bitcoin mauling shows no signs of ending. Today, the key focus is NFP; see our full preview here. 

In premarket trading, Mag 7 stocks are mostly lower (Nvidia -1.3%, Microsoft +0.4%, Tesla +0.1%, Apple -0.1%, Alphabet -0.4%, Amazon -0.2%, Meta -0.2%, Nvidia -1.3%)

• Argan (AGX) rises 11% after the power-plant construction company reported first-quarter revenue above what analysts expected.
• Chipotle (CMG) is up about 2% after JPMorgan upgraded to overweight, citing a “rare valuation opportunity” for the stock.
• Cooper Cos (COO) gains 6% after the lens maker posted second quarter sales and profit that topped estimates.
• Docusign Inc. (DOCU) is down 4% after the company provided an in-line forecast for second quarter revenue. Analysts notes that its still a wait-and-see story as the company ramps Intelligent Agreement Management, its AI-powered platform for contracts.
• G-III Apparel Group (GIII) rises 8% after the clothing company boosted its adjusted earnings per share guidance for the full year.
• Guidewire (GWRE) is down 12% after the midpoint of the software company’s subscription and support revenue forecast for the fourth quarter fell short of the average analyst estimate.
• Lululemon Athletica Inc. (LULU) slides 10% after the company lowered its annual forecast due to deteriorating performance in North America.
• Merlin Inc. (MRLN) soars 29% after the defense technology company announced the successful completion of the critical design review for its C-130J autonomy program with the US Special Operations Command.
• Samsara (IOT) slips 2% after the GPS fleet tracking company posted first-quarter results.
• ServiceTitan (TTAN) jumps 15% after the software solutions firm reported revenue for the first quarter that beat the average analyst estimate.

Stocks are pulling back for a second day after Broadcom’s outlook for chip sales fell short of high expectations, raising questions over whether the rally in the AI trade had run too hard. The lack of progress toward a deal in the Middle East has also stoked worries that oil prices will remain elevated for some time. 

"Following a period of upward revisions to earnings expectations across the sector, investors are taking a more selective approach to new information and guidance updates,” said Tomás García-Purriños, senior asset allocation strategist at Santander Asset Management. “We would view the recent weakness primarily as profit-taking and consolidation after a strong run.”

The chase for tech stocks took a further knock after S&P Dow Jones Indices said it would keep its eligibility criteria for benchmarks such as the S&P 500, rejecting proposals that would’ve allowed mega-caps to gain entry more quickly after going public. The decision means companies such as SpaceX, Anthropic PBC and OpenAI would have to wait at least a year for inclusion in the US benchmark after their debut. Fast inclusion in the S&P 500 would’ve led to about $14 billion in forced passive buying for SpaceX.

Friday’s jobs data will likely show a solid increase in payroll numbers, up 88K (if down from 115K in April), suggesting the strong March and April reports reflected underlying momentum rather than just a rebound from earlier weakness, according to Bloomberg Economics. Our preview can be found here. The report may not offer strong direction for stock markets, as a focus on signs of price pressures is keeping investors to expect a rate hike as soon as December. Goldman noted that the implied move of 47 basis points is much lower than the average realized move over the past year, and the lowest since Dec 24. 

“Employment figures should not move the needle unless there is a major surprise,” said Roberto Scholtes, head of strategy at Singular Bank. “Instead, the key variables to watch are 10- and 30-year Treasury yields, which are hovering around the 4.5% and 5% ‘pain threshold’ levels.”

Europe’s Stoxx 600 is brushing broader losses off and edging higher, as losses for tech stocks and miners are offset by gains for consumer names.Here are the biggest movers Friday:

• Raspberry Pi shares rise as much as 14%, extending their run and hitting a new all-time high after the British maker of small, low-cost computers said earnings this year will be well ahead of expectations, pointing to robust demand
• Evoke shares rise as much as 17% yet trade about 10% below the value of a recommended all-stock offer from Bally’s Intralot. Berenberg analysts expect the deal to get done on the current terms
• CMC Markets shares rise as much as 7.3%, extending strong gains since the online trading platform guided to a stronger-than-expected FY27 performance on Thursday, as Jefferies upgrades to buy from hold
• Infineon shares slide 5.7% after being downgraded by analysts at MP Capital Markets because the recent strength in the semiconductor stock leaves “limited upside” on the table
• Bodycote shares fall as much as 11%, most since March 2025, after Apollo Management Holdings said it does not intend to make a firm offer, ending discussions that began with a conditional proposal announced on May 22
• Wacker Chemie falls as much as 6%, the most since April 29, after Citi cut its recommendation to sell, saying momentum in upstream chemicals may be moderating, leading to a less compelling risk/reward for Wacker Chemie and Clariant

Asian equities slid for a second day, dragged down by losses in technology hardware shares as enthusiasm for the artificial intelligence trade cools. The MSCI Asia Pacific Index fell as much as 2.3% before paring some of its declines. Heavyweight chipmakers Samsung and SK Hynix were the biggest drags. South Korea’s Kospi led losses around the region, tumbling over 5%. For the week, the regional measure was down about 1.3%. Stocks in Indonesia extended this week’s slump, heading for the lowest close since November 2020. Global tech stocks fell after a weaker-than-expected outlook from US chipmaker Broadcom, indicating investors are nervous about sustainability of the AI rally. Meanwhile a lack of progress in talks between the US and Iran threatened to keep oil prices elevated, raising inflation concerns.

In FX, The Bloomberg Dollar Spot Index is down 0.2%, while the euro is holding its gain despite a downward revision to first-quarter GDP growth, entirely due to a contraction in Ireland. EUR/USD rose 0.2% to 1.1637. USD/JPY inched 0.1% lower to 159.86: Japan Finance Minister Satsuki Katayama reiterated that the government stands ready to respond appropriately to currency moves at any time. USD/CAD fell 0.2% to 1.3880:Friday’s data will include change in nonfarm payrolls, unemployment rate for the US and unemployment rate, net change in employment for Canada as well

In rates, treasuries are mixed ahead of the May jobs report at 8:30am New York time, with oil prices little changed as traders await signs of progress in US-Iran peace talks.US yields remain within a basis point of Thursday’s closing levels with the 10-year near 4.47%. Gilts in the sector outperform slightly while bunds lag by around 1bp. US curve spreads are marginally steeper on the day. WTI crude oil futures down 0.2% underpin Treasuries, while Nasdaq 100 futures are off nearly 1% as tech stocks falter.

Ahead of May jobs report, Fed-dated OIS contracts price in around 17bp of tightening by year-end and fully price in a 25bp hike by the March FOMC meeting. Into the data, Thursday’s activity in Treasury options was active and mixed in direction, while SOFR options flows largely consisted of position liquidation and adjustment, as traders looked reduce risk.

In commodities, Brent edged lower to around $94.80 a barrel. 

Cryptocurrencies are under sustained selling pressure, heading for a sixth straight day of losses. Sentiment is hurt by Middle East tensions, expectations of higher U.S. rates, ETF outflows, and Strategy’s reported bitcoin sales for the first time since 2022. Bitcoin falls 2% to $62,292, Ether drops 5.8% to $1,669, and Solana declines 4.1% to $66.20, all near multi-month or multi-year lows.

Today's US economic data calendar includes May jobs report (8:30am) and April consumer credit (3pm). Fed speaker slate empty for the session. External communications blackout commences Saturday ahead of the June 17 policy announcement

Market Snapshot

Top Overnight News

• US and Iran Show Little Progress in Talks After Week of Clashes: BBG
• Iran has informed Pakistan of its acceptance of transferring part of its uranium to a third country that agrees to it. However, Al Arabiya followed up by stating that the US still refuses Iran's request to release its frozen funds.
• Senate passes $70 billion ICE funding; fails to ban Trump's 'anti-weaponization' fund: RTRS
• Senate blocks debate on FISA surveillance law days before program 'goes dark: RTRS
• Anthropic Calls for AI Pause Button to Let Humans Take Stock: BBG
• Apple’s Plan for AI Dominance Rests on Fixing Its Much‑Maligned Chatbot: WSJ
• Point72 Weighs Paying Other Hedge Funds to See Their Trade Ideas: BBG
• Morgan Stanley Sees SpaceX’s Revenue Reaching $3.4 Trillion in 2040: WSJ
• Trump's trade adviser Navarro said the Fed shouldn't raise rates into supply shock inflation.
• US officials held preliminary discussions with major AI companies about the potential for the government to acquire some shares in their firms, according to people familiar with the matter cited by NOTUS.
• Banks Curb China Trips, Delay Events After Cross-Border Scrutiny: BBG
• The Anything-Goes Era in Private‑Credit Lending Is Coming to an End: WSJ
• Americans on GLP-1s Are Overwhelming Retailers With Their Nonstop Returns: WSJ
• A weekly flow data shows USD 39bln into bonds (a record inflow), USD 122bln into cash, USD 23.1bln into stocks, USD 2bln out of crypto (biggest since November 2025), USD 3.1bln out of gold (biggest in 10 weeks).

A more detailed look at global markets courtesy of Newsquawk

APAC stocks were mostly lower with the region subdued by recent tech-related pressure, and despite the predominantly positive handover from Wall St, where healthcare helped boost the Dow to a record high. ASX 200 declined as the losses in the mining, materials and resources sectors overshadowed the outperformance in health care. Nikkei 225 retreated amid tech selling but with the index off today's worst levels after bouncing off a floor beneath the 66,000 level, while data was mostly encouraging as Household Spending and Labour Cash Earnings topped forecasts, which effectively supports the argument for a BoJ rate hike this month. Hang Seng and Shanghai Comp were mixed with Hong Kong pressured after the recent efforts to tighten cross-border capital outflows, including banks suspending opening Hong Kong bank accounts for mainland clients that could be used for overseas investments, while the mainland is marginally positive after the PBoC resumed open market operations.

Top Asian News

• Japanese PM Takaichi said there are pros and cons to a weak yen, while she added that investment strategy will help maintain trust in the yen and that her economic policy is aimed at boosting Japan's economic capability, not at FX manipulation.
• Japanese Finance Minister Katayama said the direction on sales tax cut hasn't been decided, adds government will not rely on debt to finance the food sales tax cut.

European bourses (STOXX 600 +0.2) start the last trading session of the week mixed, with the breadth of performance narrow. Global tech continues to sell off, after Broadcom's AI chip revenue fell short of expectations, weighing on indices that are heavily weighted with tech names (AEX -0.1%, EuroStoxx 50 -0.1%). Sectors point to a neutral bias. Retail (+1.5%) and Media (+1.5%) outperform, while Technology (-1.6%) and Basic Resources (-1.8%) are the clear laggards.

Top European News

• UK MP/PM candidate Burnham has spoken on options for increasing infrastructure spending without breaching the fiscal rules, FT reported citing sources.
• Andy Burnham says he would run in a Labour leadership contest and, if prime minister, urgently tackle social care, taxation and devolution while avoiding a snap election or immediate Brexit rerun, according to the Guardian.
• UK PM spokesperson said Starmer will not walk away from PM job, in response to Andy Burnham's bid for the leadership, while Burnham confirmed he'll stand to replace PM Starmer as Labour leader, as he stated that Wes Streeting seems to have launched a leadership contest, which he would seek to join.
• Norway's Stryke labour union said companies have agreed wage deal for oil workers and that they will not go and strike.

FX

• G10s are all firmer against the Buck, where DXY -0.2% as it respects recent ranges into the US Jobs report. Franc leads, EUR +0.2% and GBP +0.2% also performing well.
• In a quiet morning session, the Buck has trundled lower from a 99.40 peak to a trough just above 99.20. Today sees the release of May US Jobs data, expected to tick lower to 85k from 115k in April. Recent labour market proxies align with expectations of a cooling in the labour market, as initial jobless claims rose to 225k from 212k, above the top end of the forecast range, while Challenger layoffs rose to 97.006k from 83.387k. Aside from macro data, focus remains on geopolitics, where headlines overnight suggested Washington demanded Tehran deliver its response before the end of the week or be hit with strikes. MUFG notes EUR/USD is vulnerable to a stronger employment print citing the OIS curve in Europe, which they believe is now well priced or even overpriced for what the ECB will deliver. Markets currently assign 14bps of tightening by year-end for the Fed.
• EUR performs well on the back of the weaker Buck. The likely catalysts today for the single currency will be the US Jobs report, which is expected to cool on a monthly basis. ING, which has an above consensus expectation (100k vs consensus 85k), contends the US print will support the Buck, and potentially enough to price a 25bp hike from the Fed by year-end, widening rate differentials. EUR/USD +0.2% firmed throughout the morning after rising from the 1.16 mark.
• CHF continues to mark gains against the Euro and Buck in wake of May inflation data. EUR/CHF U/C, USD/CHF -0.2%. Antipodeans firmer, but to a lesser extent than cyclicals as metals are lower across the board and amid the general equity risk tone.

Central Banks

• RBI keeps Repurchase Rate unchanged at 5.25%, as expected, via unanimous decision, while policy stance kept at neutral. RBI Governor Malhotra said the central bank would take steps, if needed, to rein in speculative activity in the FX market.

Fixed Income

• Global fixed benchmarks are slightly firmer this morning alongside some mild pressure in the energy complex. Markets remain on tenterhooks, awaiting the key NFP report and mixed geopolitical updates: 1) Trump said talks with Iran are going well, 2) reports suggest Washington has demanded Iran deliver a response before the end of the week, 3) Hezbollah rejected the US-backed ceasefire between Lebanon and Israel. (Please see the commodities section for details.)
• USTs (+9 ticks) are firmer and trade within a narrow 19-18 to 109-23 range. Tentative action as markets await the US NFP report later today; in brief, the US economy is expected to add 85k nonfarm payrolls in May, vs 115k added in April. The unemployment rate is seen unchanged at 4.3%. Traders will be watching closely for signs of labour market deterioration, given that FOMC officials view employment risks as tilted to the downside, though Fed officials are seemingly more concerned about the inflation side of its mandate, amid the labour market stability.
• US yields are lower across the curve, with some mild underperformance in the belly. The 10yr (4.46%) resides just shy of the key 4.50% mark; a dovish NFP report could see the yield test near-term support at 4.45%, and then a cluster of highs at around the 4.42%. Of course, a hawkish report would see a potential test of 4.50%, and a breach above that mark will bring in near-term highs at 4.53%.
• Bunds (U/C) and Gilts (+17 ticks) also trade incrementally firmer. There has been a lack of pertinent newsflow for either region; UK Halifax House Price Index showed that prices edged a little lower in May due to the Middle East war. Elsewhere, the BoE DMP report was released, which saw 1yr ahead inflation expectations rise, whilst the 3yr was left unchanged. Focus will shift to BoE speak via Dhingra and Bailey this afternoon. Bunds currently hold within a 125.54 to 125.69 range; Gilts hold within a 87.77 to 88.05 range.

Commodities

• In US-Iran news, the biggest setback this week regarding US and Iran talks (in spite of the flare-ups) came in Lebanon, where Hezbollah publicly rejected the latest US-backed Israel-Lebanon ceasefire framework, saying it required Hezbollah concessions without an Israeli withdrawal, and vowed to continue resistance while Israeli forces remain in Lebanese territory. An Israel-Hezbollah ceasefire remains a key Iranian demand for broader peace talks. Washington reportedly demanded Tehran respond by the end of the week and warned of either an agreement or military action. More recently, Al Hadath reported that Iran has informed Pakistan of its acceptance of transferring part of its uranium to a third country that agrees to it, which resulted in fleeting downside in energy benchmarks.
• Crude futures are off their worst levels with little in terms of notable geopolitical headlines this morning. Following Hezbollah’s rejection yesterday, Israeli army issued evacuation warnings for 9 villages in southern Lebanon. Note, this morning, there were reports of a marine drone exploding in Romania, although the Romanian defence ministry later clarified that this was a Romanian army drone. WTI Jul resides in a USD 91.50-USD 93.54/bbl range while Brent Aug sits in a USD 93.64-95.90/bbl range. Dutch TTF trades higher by around 1%, just north of the EUR 49/MWh level.
• Spot gold has rebounded after finding support at its 200 DMA for a second day in a row (200 DMA at USD 4428/oz today). The yellow metal still trades with modest intraday losses and within a USD 4429-4482/oz range, within yesterday’s 4424-4515/oz parameter. Traders look ahead to the US NFP later today for impetus (full preview available on Newsquawk).
• Base metals are lower across the board but to varying degrees after trickling lower in APAC alongside the mostly downbeat overnight risk sentiment. 3M LME copper resides in a USD 13,711.70-13,893.30/t range at the time of writing.
• Petroleum Development Oman said operations at the Mina Al Fahal port are proceeding normally after oil loadings were suspended following an explosion due to an alleged drone attack.

Trade/Tariffs

• US President Trump said automakers sought no tariff changes in their meeting and that talks focused mostly on car repair.
• China International Trade Council says it opposes proposed US tariffs and criticised the plan for 12.5% tariffs on Chinese goods.

Geopolitics: Middle East

• Iran has informed Pakistan of its acceptance of transferring part of its uranium to a third country that agrees to it, Al-Hadath reported. However, Al Arabiya followed up by stating that the US still refuses Iran's request to release its frozen funds.
• US President Trump said they do not need help from European countries regarding Hormuz and noted that Iran talks are going well, while he reiterated that almost all of Iran's leadership has been wiped out and that Iran has no navy or air force. Trump said if Iran killed US troops, it would restart the war quickly, and the Israel-Lebanon conflict is interconnected with Iran. Trump also stated he thinks progress has been made on Lebanon, and he would be honoured to meet Iran's Supreme Leader if a deal is made.
• Iranian Foreign Minister Araghchi said they have many documents and evidence that show Kuwaiti skies have been used regularly against Iran. Araghchi also commented that Iran and Oman will regulate the management of the Strait of Hormuz based on international law standards, while they will exchange views and ideas about the management of the Strait with the Persian Gulf countries, but ultimately the decision will be made between Iran and Oman.
• Iran's Supreme Leader advisor Rezaei said US President Trump wants to pressure Iran to accept his conditions and keep Iran in a vague state, while he added that the current draft has ambiguities that have to be clarified. Rezaei also said that Iran will stand firmly with Hezbollah in Lebanon and that Iran will have no hesitation in defending its interests and security.
• Pakistan's interior minister was reported to return to Tehran to push negotiations.
• Israeli army issued evacuation warnings for 9 villages in southern Lebanon, Sky News Arabia reported.
• Hezbollah claimed drone and missile attacks on Israeli bases, while it also stated that six Merkav tanks were destroyed in Lebanon, according to Fars.
• US House rejected a war powers resolution on Lebanon in a 92 vs 324 vote.

Geopolitics: Ukraine

• US House voted 226 to 195 to approve the Ukraine aid package and Russia sanctions bill after more than a dozen GOP lawmakers voted against party lines.

Geopolitics: Other

• US sanctioned Cuba's President Miguel Diaz-Canel, while President Trump said sanctions are not meant to accelerate a collapse, and stated they will handle Cuba after they take care of Iran.
• Marine drone explosion has been reported in Romanian Black Sea Port of Constanta-Digi 24. Romania’s Defence Ministry later said that the Romanian Army maritime drone found at Constanța civilian port self-detonated, causing no casualties, and was not linked to recent Black Sea exercises.

US Event Calendar

• 8:30 am: May Change in Nonfarm Payrolls, est. 88k, prior 115k
• 8:30 am: May Change in Manufact. Payrolls, est. 2k, prior -2k
• 8:30 am: May Unemployment Rate, est. 4.3%, prior 4.3%

DB's Jim Reid concludes the overnight wrap

As we hit another payrolls Friday in the US, Asian markets are seeing some decent sized tech losses in what seems to be a hangover from Wednesday night's Broadcom results where forecasts weren't as elevated as some of the more optimistic predictions hoped. The KOSPI is down -5.02% with the Nikkei -1.27% lower. The latter is also influenced by the increasing view that the Bank of Japan will have to raise rates over the coming year. The meeting on the 16th of this month now sees a 96% probability of a hike according to futures. In our World Outlook our economist forecast a hike a quarter over the next year. This is more hawkish than the consensus.

The Hang Seng (-0.84%) is also trading lower on tech losses with the ASX -0.63%. S&P 500 (-0.59%) and NASDAQ 100 (-1.07%) futures are also weak for this time of the day. Bucking the trend is the Shanghai Composite (+0.43%). European stock futures are only down just over a tenth of a percent given their low tech weighting.  

Early morning data revealed that Japan’s real wages rose by +1.9% in April (compared to +1.7% anticipated) y/y, contributing to a smaller-than-expected decline in household spending. Average nominal wages, or total cash earnings, increased by +3.5% year-on-year (against +3.1% expected). This figure represents the fastest wage growth since December 2024, following a revised increase of +3.1% in March. The April data marks the first instance in over 34 years where wage growth has surpassed 3% for three consecutive months. In a separate report, Japan’s household spending decreased by -0.5% year-on-year in April, a less severe decline than the expected drop of -1.5%, following a -2.9% decrease in the previous month. This decline has extended the trend of falling consumer spending to five consecutive months.

Before these overnight moves, markets stabilised yesterday amidst growing hopes for some sort of US-Iran deal. So Brent crude oil prices (-2.84%) fell back to $95.03/bbl, reversing course after three consecutive gains, which in turn helped to ease fears about a stagflationary shock. As a result, markets followed the usual pattern of the last three months, where lower oil prices meant bond yields also fell back, with investors pricing in a more dovish path for central banks too. Meanwhile, equities recovered, including the S&P 500 (+0.41%), although it wasn’t all good news for risk assets yesterday, with Bitcoin (-2.06%) falling to its lowest level since early February, at $63,575.  

In terms of the latest from the Middle East, there wasn’t much in the way of fresh news. However, oil prices saw a clear move lower after Trump issued a post criticising the vote in the House of Representatives against the Iran conflict. That was because Trump’s post said the vote was “right in the middle of my final negotiations to end the War”. So that suggested talks were still happening and a deal might be near. Oil prices did rebound a bit during the US session as Lebanon’s Hezbollah militia rejected the US-brokered ceasefire, but overall this didn’t derail the more optimistic mood following the ceasefire announcement by Israel and the Lebanese government the previous evening.

And investors also priced out the chance of a longer conflict, with the 6-month Brent future (-2.15%) also falling to $85.04/bbl. So that helped to ease concerns about inflation, with the 1yr US inflation swap (-9.2bps) falling to 3.09%, whilst the 1yr Euro inflation swap (-5.5bps) fell to 2.99%.

With easing fears around inflation, markets dialled back the chance of a rate hike from the Federal Reserve this year. Indeed, the probability of a hike by December was down to 68% by the close, having been at 81% the previous day. Moreover, those dovish expectations got further support from some weaker US data, with the weekly initial jobless claims rising to their highest since early February. They hit 225k in the week ending May 30 (vs. 215k expected), and even though the Memorial Day holiday could have created volatility, the 4-week moving average also reached a 3-month high of 214.75k. So the release leant against the more positive US data in recent days, and it helped Treasury yields to decline across the curve. For instance, the 2yr yield (-3.8bps) fell back to 4.04%, whilst the 10yr yield (-2.1bps) fell back to 4.47%, roughly where we are this morning as I type.  

Looking forward, US data will stay in the spotlight today, as we’ll get the May jobs report at 13:30 London time. This will be an important one for the Fed, as the strong labour market data of recent weeks has fuelled the speculation about a potential rate hike. Indeed, we’ve just had back-to-back payrolls above +100k in March and April, which is the first time that’s happened since 2024. And so long as the labour market stays in decent shape, that will keep the focus on the inflation side of the Fed’s mandate, which has moved increasingly above target given the energy shock. In terms of today’s report, our US economists expect payrolls to come in at +50k (consensus +88k), with the unemployment rate remaining at 4.3%. So if realised, that would be a slowdown from the last couple of months, but would still mark 3 consecutive positive readings for the first time in a year. Our economists' lower than consensus forecast is not necessarily a structural story, more a slowdown in some sectors that have recently seen outsized gains. Our economists have been more optimistic on the labour market than their peers in recent months.

Ahead of that, US equities also regained momentum before this morning's futures sell-off, with the S&P 500 (+0.41%) paring back the previous day’s losses and still looking to post a 10th consecutive weekly increase for the first time since 1985. We are at +0.06% so far this week but futures are lower so we'll see what happens. 

Most constituents in the index put in a solid performance yesterday, with 363 advancers – the most since April – and with the equal-weighted S&P 500 (+0.79%) rising to an all-time high. Chipmakers were the major exception to that, and Broadcom (-12.59%) was the second-biggest decliner in the index after their earnings the previous day. That included a forecast for AI chip revenue that was beneath expectations, which led to broader concerns around the sector. The Philly semiconductor index fell by -2.15% but it did recover from as much as -6.29% down early in the session. And the broader tech mood wasn’t as negative, with six of the Mag-7 (+1.06%) moving higher.  

Earlier in Europe, markets had put in a positive session across bonds and equities, benefiting from the fall in oil prices and being less exposed to semiconductor stocks. So the STOXX 600 (+0.52%) put in a decent performance, alongside gains for the DAX (+0.60%), the CAC 40 (+1.15%) and the FTSE MIB (+0.27%). Moreover, European rates rallied too, with yields on 10yr bunds (-1.0bps), OATs (-1.5bps) and BTPs (-1.8bps) all falling.

Looking at the day ahead, data releases include the US jobs report for May, French industrial production for April, and the third release of Q1 GDP for the Euro Area. Central bank speakers include BoE Governor Bailey and the BoE’s Dhingra.

Tyler Durden Fri, 06/05/2026 - 08:27