Individual Economists

What Is The Administrative State?

Zero Hedge -

What Is The Administrative State?

Authored by Roger Kimball via American Greatness,

Last week in this virtual space, I wrote that Donald Trump would make a renewed effort during his second term to dismantle “the administrative state.” As in his first term, he would employ various strategies to blunt the effects of the administrative apparatus that governs us. He would, for example, disperse some parts of the government outside the overwhelmingly left-progressive swamp of Washington, D.C.

As an aside, I should note that I regard the persistence of Washington as the seat of our government as a serious impediment to the goal of “deconstructing” the administrative state. “It has,” I wrote back in 2022, “long been obvious to candid observers that there is something deeply dysfunctional about that overwhelmingly Democratic, welfare-addicted city.”

It is a partisan sinkhole. Jefferson wanted the capital moved from New York to Washington in part to bring it closer to the South, but also to place it in a locality that was officially neutral. There is nothing neutral about Washington today. The city has some impressive architecture and urban vistas. They should be preserved and staffed as tourist attractions. But the reins of power should be relocated.

I doubt that will happen. Which means that the eternal vigilance that MAGA must maintain around its enemies will have to be redoubled. Trump attempting to govern from Washington will be like Ike trying to undertake the Normandy invasion with half his planners on loan from the German general staff.

Still, there are some symbolic gestures that he and his aides might consider. I have long suggested that the inauguration be held somewhere other than Washington, D.C. There is nothing in the Constitution that requires the inauguration be in Washington. LBJ, remember, was sworn in on Air Force One just a couple of hours after Kennedy was assassinated. When Warren Harding died, Calvin Coolidge was visiting the family homestead in Vermont. His father, a justice of the peace, administered the oath of office in the parlor. I think the next inauguration should be well away from the swamp of Washington. Mar-a-Lago in Palm Beach is one venue that springs to mind, but I am sure there are other attractive spots. At a minimum, I hope the inauguration committee will consider having some of the parties elsewhere. A ball in Butler, PA, for example, would not only be celebratory but also serve as a useful reminder of how close Trump came to a fatal encounter with an assassin’s bullet.

But the trouble with “Washington”—I use scare quotes to indicate that we are dealing with spiritual as well as geographical dispensation—is not only its partisan nature. There is also its apparently unstoppably expansionist character. No matter which party is in power, the business of Washington is to make government bigger—forever. Republicans talk about “limited government.” They then sign on to nearly every scheme to make government bigger and more intrusive. Democrats do the same, of course, but they generally skip the rhetorical foreplay about making government smaller.

One huge difference this time around will be the Department of Government Efficiency, DOGE for short, an ad hoc executive initiative that will be overseen by Elon Musk and Vivek Ramaswamy. They outlined their bold plan in an op-ed for The Wall Street Journal last week. “Unlike government commissions or advisory committees,” they noted, “we won’t just write reports or cut ribbons. We’ll cut costs.” Will they? It would be pretty to think so. Musk has said that he wants to cut government expenditures by $2 trillion. If he could manage even a quarter of that amount, it would be something to write home about. It may seem utopian. But remember, Musk bought Twitter and instantly cut the workforce by 80 percent. He vastly improved the platform, salvaged free speech, and transformed a dying company into a dynamic one.

As usual, the devil will be in the details. Musk and Ramaswamy may identify the ideal candidates for downsizing or elimination. Exactly how will they move from pen to scissors is the $64,000—or rather, the $2 trillion—question. I take solace from the thought that if anyone can do it, the triumvirate of Trump, Musk, and Ramaswamy can. Naturally, opposition will be ferocious. Will it also be effective? Time will tell.

I have not yet answered the question posed in my title: “What is the administrative state?” A friend asked me that in the course of our conversation about my column last week. Isn’t it possible, he asked, that “administrative state,” like its scarier sounding cousin, “deep state” is just a polysyllabic synonym for “state,” for the complex activities of government in a complex, technologically advanced polity? Maybe “administrative state” is just an invention of right-wing “conspiracy theorists” who find goblins where there are only harmless bureaucrats?

I nattered on about the growth of the regulatory state, the battalions of unelected and unaccountable bureaucrats who govern us from their perches in the alphabet soup of modern, Kafkaesque governance, and put in a plug for Tocqueville’s analysis of “democratic despotism.” I also noted that the phrase “conspiracy theorist” is generally used in a prophylactic, not a descriptive sense. That is, it is a phrase that is wheeled out when the aim is to end, not further, the conversation. The problem is not conspiracy theories, but conspiracies in fact.

One example.  When revelation of the contents of Hunter Biden’s “laptop from hell” threatened to upend Joe Biden’s 2020 presidential campaign, Anthony Blinken asked acting CIA director Michael Morell to organize a letter signed by 51 former intelligence officers stating that the laptop bore all the signs of “Russian disinformation.” Morell did this, he said,  in order to give Biden a “talking point” for his forthcoming debate with Donald Trump. The public did not know this at the time. When the truth leaked out, the establishment claimed it was only a “conspiracy theory” put about by Trump supporters. But it wasn’t a conspiracy theory. It was a conspiracy in fact. 

I stand by everything I said, but I did not say enough, and what I did say was not precise enough. Formulating definitions is often a mug’s game. This is because, for any important matter, a definition that is true will also have to be so general as to be vacuous or at least unilluminating. What is love? What is virtue? What is knowledge? In everyday life, these chestnuts from the philosophy seminar tend to get assimilated to the indefinite definition Justice Potter Stewart offered for “obscenity”: “I know it when I see it.”

Still, there’s something to be said for making the effort. So here goes. “‘The administrative state’ is that quota of political power that covertly fills the vacuum left by the failure of the legislative branch to discharge its obligations.”

Two things are critical.

  • One is the displacement of sovereignty. No longer are the people sovereign. The bureaucracy is.

  • The second critical thing is the covert nature of the enterprise.

The question “What is the administrative state?” can seem difficult to answer because it is not supposed to exist in the first place. You know it only by its actions. You cannot look it up in the statute book, much less in the Constitution. Indeed, the very fact of the administrative state violates any number of Constitutional norms, not least its being a sort of “fourth branch” of government when the Constitution provides for only three.

Edmund Burke touched on an essential aspect of this process in Thoughts on the Cause of the Present Discontents (1770). Criticizing the Court of George III for circumventing Parliament and establishing by stealth what amounted to a new regime of royal prerogative and influence-peddling, Burke saw how George and his courtiers maintained the appearance of parliamentary supremacy while simultaneously undermining it. “It was soon discovered,” Burke wrote with sly understatement, “that the forms of a free, and the ends of an arbitrary Government, were things not altogether incompatible.” That malign co-habitation stands behind the growth of the administrative state. We still vote. We still have a bicameral legislature. But behind these forms of a free government, the essentially undemocratic activities of an increasingly arbitrary and unaccountable regime pursue an expansionist agenda that threatens liberty in the most comprehensive way, by circumventing the law. 

The shadowy nature of the administrative state helps to explain why it is so hostile to free speech and, by the same token, why it tends to be receptive to the deployment of censorship and police power to achieve its ends and stymie the ends of its critics. That is why the rise of the administrative state goes hand in hand with the loss of public confidence in society’s guiding institutions. Talk of “democracy” and “our democracy” is ever on their lips. SWAT teams, prosecutorial abuse, and lawfare are out on the street for all to see. Bottom line: The age of the administrative state is at the same time an age of declining legitimacy in the foundational institutions of civil society.

Officially, the administrative state is not supposed to exist.  Having people talk about the fact that it does exist and that it often pursues ends that are contrary to the ends of the people outside its magic circle of custodians means that by definition free inquiry is a threat to its perpetuation. That is one reason that the administrative state is so hostile to democracy. It is also an important reason why it must be dismantled and returned to the graveyard of rebarbative systems of political obfuscation and bureaucratic tyranny. 

Tyler Durden Mon, 12/02/2024 - 18:25

Enron Is Not "Back"

Zero Hedge -

Enron Is Not "Back"

There was a lot of chatter on Monday morning about defunct Enron rising from the ashes after an X account named "Enron" posted, "We're back. Can we talk?"

On its website, "Enron.com," the company, supposedly operating as "Enron Corporation," published what could be described as one of the laziest press releases imaginable, with formatting that resembles something generated by ChatGPT... 

Buried in the "Terms of Use and Conditions of Sale" section of the website, Enron states: "THE INFORMATION ON THE WEBSITE IS FIRST AMENDMENT PROTECTED PARODY, REPRESENTS PERFORMANCE ART, AND IS FOR ENTERTAINMENT PURPOSES ONLY."

Public records forensic analysis via the platform Sayari shows "Enron Corporation" has been "Inactive" for years. In other words, the website has nothing to do with defunct Enron.

"No @Enron is not back... Original IP is DEAD and some clever people registered it earlier this year... Caveat emptor," one X user said. 

Exactly. 

And trademarks?

Take a look at the alleged Enron team. Whoever built the website just used iStock models with a focus on diversity.

Not believable. 

More LoL from the website. 

Selling merchandise is the goal? 

Possibly, but this might be tied to a crypto pump-and-dump scheme.

Not sure if this coin is related.

Caveat emptor. 

Tyler Durden Mon, 12/02/2024 - 18:00

Debanked: The Financial Suppression Of Bitcoin Businesses Must End

Zero Hedge -

Debanked: The Financial Suppression Of Bitcoin Businesses Must End

Authored by Colin Crossman via BitcoinMagazine.com,

"We can't live in a world where somebody starts a company that's a completely legal thing, and then they literally [] get sanctioned [] and embargoed by the United States government through a completely unaccountable [process] by the way. No due process. None of this is written down. There's no rules. There's no court, there's no decision process. There's no appeal. Who do you appeal to, right? [] Who do you go to to get your bank account back?"

- Marc Andreessen, speaking to Joe Rogan, published on 11/26/2024

In yet another troubling manifestation of "Chokepoint 2.0," a Wyoming company was summarily debanked in early November, 2024, by Mercury, a banking platform operated with Evolve Bank (and other banking partners). After years of seamless operations and exemplary service, Mercury abruptly terminated the account without clear cause. The excuse? A vague nod to "internal factors" that remain as opaque as the regulatory pressures likely behind them.

Let’s be clear: The company's banking activity was uncontroversial. The only potential offense is that the company accepts a sizable portion of its customer payments in Bitcoin. Aside from monthly wires from Kraken (a regulated crypto exchange), its transactions included rent, utility payments, hardware store purchases, and subcontractor invoices.

The termination couldn't have had anything to do with risky behavior or financial misconduct. Instead, the closure is emblematic of a systemic effort to hobble Bitcoin businesses by exploiting the centralized banking choke points regulators have turned into tools of suppression.

This is Chokepoint 2.0 in action. Regulators have found new ways to suppress industries they disfavor—this time, targeting Bitcoin miners and businesses. Instead of legislative debate or due process, unelected bureaucrats leverage their oversight of banks to nudge them into “de-risking” clients that engage in entirely legal activities. The company was simply collateral damage in the campaign to isolate Bitcoin from the traditional financial system.

This is a chilling echo of Operation Chokepoint 1.0, where federal regulators illegally pressured banks to cut off services to lawful but disfavored industries, such as firearms dealers and payday lenders. That campaign ended in disgrace when the FDIC was forced to settle a lawsuit in 2019. The settlement affirmed what should have been obvious: weaponizing the financial system against legal businesses is unconstitutional. Regulators know this—and yet here we are again.

Why This Matters

Debanking isn’t just an inconvenience. For businesses, it’s existential. Operating without a reliable banking partner in today's economy is like trying to breathe without air. When banks are coerced into severing ties with Bitcoin-related companies, it sends a chilling message: engage in this industry at your peril. It also stifles innovation, a dangerous precedent for a country founded on economic freedom.

Moreover, this practice undermines the core tenet of fairness in financial services. The American banking system isn’t a private fiefdom. It operates under public charters and with public trust, and its gatekeepers should not act as arbiters of political or ideological purity.

The harm extends beyond Bitcoin. If regulators can throttle this industry, what stops them from targeting others? What happens when innovation, dissent, or inconvenient truths are deemed “too risky” for the comfort of entrenched powers? This is about more than Bitcoin—it’s about the integrity of the financial system and the preservation of free markets.

A Call to Action: Accountability for Regulators

The new Congress and Trump administration must seize this moment to hold the architects of Chokepoint 2.0 accountable. This isn’t a partisan issue; it’s a constitutional one. Regulators acting as de facto lawmakers, imposing policies that would never survive public scrutiny, must be reigned in.

1. Investigations into Regulatory Overreach

Congress must launch comprehensive investigations into the agencies pressuring banks to sever ties with Bitcoin businesses. Who issued these directives? Under what authority? The American people deserve answers, and the offending parties deserve consequences.

2. Personal Accountability for Regulators

Bureaucrats who abuse their power should not be shielded by the anonymity of the regulatory machine. Those responsible for weaponizing the financial system against lawful businesses must be named, shamed, and removed from their positions, permanently lose any security clearances they may have, and potentially lose their government pensions and retirement benefits.

3. Restoration of Due Process

Any decisions to restrict banking access should require clear, codified standards and a transparent appeals process. No more shadow rules. If a business is to be debanked, the reasons should be public, defensible, clearly articulated & defined, grounded in law, and appealable.

4. Legislation to Protect Financial Access

Congress should pass laws prohibiting banks from discriminating against lawful industries based on political or ideological reasons. The free market thrives on neutrality; it withers under bias.

5. Decentralization of Financial Systems

Bitcoin exists as a hedge against precisely this kind of overreach. Policymakers should embrace and encourage its growth, not fight it. America cannot afford to fall behind in the global race for financial innovation.

Much of the above could be addressed through Section 10 of the SAFER Banking Act, which directly limits undue regulatory influence over banking services. Specifically, it prohibits federal banking agencies from pressuring financial institutions to terminate relationships with lawful businesses, including those in the Bitcoin and cryptocurrency industry, based on reputational risks or political motivations. This provision reinforces the principle that decisions about financial services should rely on risk-based analysis of individual accounts rather than blanket biases against entire industries. By codifying such protections, the SAFER Banking Act would promote fairness and transparency in financial services, ensuring that regulators adhere to their duties of impartial oversight while respecting the rights of businesses operating legally under state or federal law.

In addition to legislative solutions, the presence of even one bank with the willingness and capability to resist undue regulatory pressure could dramatically reshape the financial landscape for Bitcoin businesses. Caitlin Long’s Custodia Bank, based in Wyoming, exemplifies this potential. Custodia has consistently demonstrated its commitment to operating within the law while challenging the overreach of federal regulators, as seen in its lawsuit against the Federal Reserve.

A bank with this level of resolve, direct access to the Federal Reserve itself, and a proven track record of standing up to regulators will provide a lifeline for Bitcoin (and other) businesses seeking reliable financial services. By fostering an ecosystem where lawful businesses can thrive without fear of arbitrary debanking, Custodia Bank offers a template for how other institutions might follow suit, ensuring that innovation and economic freedom remain protected.1

Taken together, the SAFER Banking Act and the perseverance of institutions like Custodia Bank represent two critical fronts in the fight against financial discrimination. While the SAFER Act provides a legislative framework to curtail regulatory overreach and protect lawful businesses from debanking, it has faced significant resistance, having been introduced multiple times in Congress only to be repeatedly blocked. Meanwhile, Custodia Bank's struggle underscores the severity of institutional hostility; the Federal Reserve's refusal to grant Custodia access to the banking system forced the bank to file a federal lawsuit just to claim its rightful place in the financial ecosystem. These challenges highlight the entrenched opposition to reform, but they also emphasize the urgent need for a multi-pronged strategy—legislative, judicial, and entrepreneurial—to ensure fair and impartial access to banking services for all lawful businesses.

Bitcoiners: The Frontline of Freedom

Bitcoin isn’t just money; it’s an idea—an idea that money and power belong to the people, not the state. This is why we’re here. This is why Bitcoin exists. The legacy financial system is crumbling under its own corruption, and every act of suppression only underscores the need for decentralized alternatives.

To be clear, I don't fully blame Mercury and Evolve for this. They're likely being forced into it by their regulators.2 Indeed, due to the Orwellian Bank Secrecy Act, the banks aren't allowed to disclose the reasons for these matters to the affected customers. Banks like Mercury, and any others who have willingly cooperated with Chokepoint 2.0 should be subject to Congressional Subpoenas to explain themselves, and also name-and-shame the regulators who coopted them.

The future of Bitcoin—and America’s role as a leader in innovation—depends on exposing and dismantling Chokepoint 2.0, and holding all those who participated in it accountable.

Tyler Durden Mon, 12/02/2024 - 17:40

Iran-Backed Iraqi Militias Pour Across Border Into Syria To Bolster Assad

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Iran-Backed Iraqi Militias Pour Across Border Into Syria To Bolster Assad

Widespread reports, including observers on the ground, have indicated that Iran-backed Iraqi militias have been pouring across the border into eastern Syria to assist Damascus in repelling the Islamist militant advance after Al Qaeda splinter group Hayat Tahrir Al-Sham took over Aleppo this weekend.

A Syrian army officer has told Reuters that Iraqi militia forces crossing the border are "fresh reinforcements being sent to aid our comrades on the frontlines in the north."

Many of the fighters have been identified as belonging to the Kataib Hezbollah and Fatemiyoun groups. The US has long been in an internecine conflict with Kataib Hezbollah in Iraq, with over the years periodic rocket fire even targeting the US Embassy in Baghdad, as well as various bases which host remaining American troops.

The Iraqi militias have been staging in the area of Abu Kamal overnight. There were rumors that US warplanes attacked their positions, but these reports turned out to be untrue.

But these forces have been fully aware that the Pentagon could attack their convoys at any moment, and so have reportedly been crossing the border in small groups and using concealed roads.

"At least 300 fighters, primarily from the Badr and Nujabaa groups, crossed late on Sunday using a dirt road to avoid the official border crossing, two Iraqi security sources said, adding that they were there to defend a Shi'ite shrine," Reuters reports.

Iranian Foreign Minister Abbas Araqchi said on Monday that with regard to new fighting in Syria, "resistance groups will help and Iran will provide any support needed." Russia has been assisting with aerial bombardments.

To recap via a note from Rabobank:

On the geopolitics front the swift dismantling of Hezbollah by Israel, and Russia’s preoccupation with its war on Ukraine appears to have come at great cost for Syria’s Bashar al-Assad. 'Rebel' forces recaptured the country’s second largest city of Aleppo as regime troops were left somewhat stranded by Russian, Iranian and Hezbollah allies and were consequently overwhelmed by the Turkish-backed rebels.

In a situation similar to Yemen, civil war has been raging in Syria for 13 years without attracting a great deal of mainstream interest in Western media. In the case of Yemen, that all changed once the civil war impacted upon freight transits through the Suez Canal, while in Syria the ongoing competition for spheres of influence by Great Powers (Russia, USA, China, Saudi Arabia, Turkey, Iran, Israel etc) provides a useful microcosm of the new global paradigm, but only if one cares to look.

In Lebanon, interestingly Hezbollah has said it does not plan to send its fighters "for now" to northern Syria to help Assad forces regain territory. Lebanese Hezbollah has of course been bogged down in over a year of fighting with Israel's military, which has included the last two months of an IDF ground offensive in the south.

Hezbollah was instrumental during the first ten years of proxy war in pushing out the US-Gulf backed jihadists; however, currently it looks like Assad's main help will come from Iran and Iraq.

President Assad was somewhat quiet throughout much of the Israel-Hezbollah war, and this could be at play in Hezbollah leadership's current reluctance to engage in the Syria theatre of the war. But it remains that the Lebanese Shia group is still desperately trying to rebuild its command structure and replenish its resources. 

via BBC

As for the Iraqi militia presence in eastern Syria, they are likely to clash with the US-backed 'Free Syrian Army' and 'Syrian Democratic Forces' (SDF) in the area. It remains possible that US warplanes could engage as well.

Tyler Durden Mon, 12/02/2024 - 17:20

Cartels Demand Higher Border Crossing Fees After Trump Victory

Zero Hedge -

Cartels Demand Higher Border Crossing Fees After Trump Victory

Authored by Eric Lendrum via American Greatness,

Drug cartels and other human trafficking groups have begun demanding higher fees for illegals seeking to be smuggled across the border in the aftermath of President-elect Donald Trump’s comeback victory.

As Breitbart reports, illegals at an alleged “charity” shelter in Sonora, Mexico told a Mexican newspaper that the smuggling fee has doubled in recent weeks, with Trump’s victory and impending return to office being given as a major reason.

The previous fees of $5,000 have risen to at least $10,000, as illegals from all around the world, including Africa, Asia, and Central America, try desperately to sneak into the country before Trump returns to office.

The smugglers have also increased their fees for additional services, such as using vehicles to cross private property, with these fees increasing from $15,000 to $20,000.

Fees have also risen dramatically for certain illegals based on how far they have traveled to try to enter the United States illegally.

Chinese illegals are paying as much as $55,000 per person to attempt being smuggled into the U.S.

In fiscal year 2023, at least 24,000 illegals from China were apprehended trying to cross the southern border.

Other illegals paying increased fees include illegals from Africa and the Middle East, due to their designation as “Special Interest Aliens.”

President-elect Trump once again campaigned heavily on the issue of immigration, vowing to finish building the border wall that he started constructing in his first term, and to carry out the largest mass deportation operation in American history.

He has announced former Immigration and Customs Enforcement (ICE) Director Tom Homan as his new Border Czar, with Homan repeatedly vowing to do whatever is necessary to deport as many illegals as possible.

Tyler Durden Mon, 12/02/2024 - 17:00

Special Counsel Rejects Hunter Biden's Pardon, Files Scathing Rebuke In Court Case

Zero Hedge -

Special Counsel Rejects Hunter Biden's Pardon, Files Scathing Rebuke In Court Case

Last night Hunter Biden's lawyers filed a motion to dismiss his California tax fraud case after Joe Biden issued a blanket pardon absolving him of all crimes committed over a 10 year period.

"The President’s pardon moots Mr. Biden’s pending and yet to occur sentencing and entry of judgment in this case and requires an automatic dismissal of the Indictment with prejudice," wrote Hunter's lawyer Abbe Lowell in the filing, adding that "this Court must dismiss the Indictment against Mr. Biden with prejudice and adjourn all future proceedings in this matter."

Special Counsel David Weiss isn't having it. In a Monday response in opposition, Weiss argued that "The defendant’s motion should be denied since there is no binding authority on this Court which requires dismissal."

"As a matter of past-practice in this district, courts do not dismiss indictments when pardons are granted," Weiss wrote - citing cases involving Steve Bannon, Michael Flynn, Joe Arpaio and Ollie North, Above the Law reports. "Instead, it has been the practice of this court that once an Executive Grant of Clemency has been filed on the docket, the docket is marked closed, the disposition entry is updated to reflect the executive grant of clemency, and no further action is taken by the Court."

Although Weiss purported not to have seen the pardon itself (which Lowell inexplicably failed to docket), he took particular umbrage at the suggestion that the prosecution was politically motivated, huffing that “The court similarly found [Biden’s] vindictive prosecution claims unmoored from any evidence or even a coherent theory as to vindictiveness.”

Judge Mark Scarsi of the Central District of California has taken no action, thus far. But in Delaware, Judge Maryellen Noreika said in a minute order that she intends to terminate the proceedings, and instructing the government to say by tomorrow if it objects to termination by dismissal. Presumably it does, although no objection has hit the docket as of this writing. -Above the Law

Hunter pleaded guilty to the tax charges earlier this year, after a Delaware jury found him guilty of lying about his drug use on a background check form used to purchase a firearm. 

In Weiss' new filing, he writes:

"The defendant did not docket the pardon nor has the government seen it. If media reports are accurate, the Government does not challenge that the defendant has been the recipient of an act of mercy. But that does not mean the grand jury’s decision to charge him, based on a finding of probable cause, should be wiped away as if it never occurred. It also does not mean that his charges should be wiped away because the defendant falsely claimed that the charges were the result of some improper motive. No court has agreed with the defendant on these baseless claims, and his request to dismiss the indictment finds no support in the law or the practice of this district."

Tyler Durden Mon, 12/02/2024 - 16:36

"They Must Be Eating Xanax Like Tic-Tacs..." - The Blob Has A Migraine

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"They Must Be Eating Xanax Like Tic-Tacs..." - The Blob Has A Migraine

Authored by James Howard Kunstler,

"It's a beautiful thing to watch the Biden family destroy the Democrat Party."

- @Mazemoore on "X"

You can be sure the blobists have seen this coming from years away. The boys and girls in the agencies have behaved more than just a little badly, and they know it. They committed serious crimes against our country and its citizens under color-of-law since 2015, ranging from seditious conspiracy clear up to treason (say, just for instance, the case of Col. Alexander Vindman using his Ukraine connections to lever Mr. Trump out of the Oval Office in the 2019 impeachment scam.)

You have whole C-suites of agencies teed-up on RussiaGate for felonies, misprision of felonies, abuse of power, deprivation of rights, lying under oath, conspiracy to commit fraud, and much more. You have Judge James Boasberg playing games in the FISA Court he presided over; Robert Mueller and Andrew Weissmann running a two-and-a-half-year Chinese fire drill to cover-up years preceding of FBI / DOJ misconduct; John Brennan, James Clapper, and Gina Haspel abusing the “Five Eyes” intel arrangements to turn the CIA on innocent citizens at home; the fifty-one current and former intel agents colluding to bury Hunter’s Laptop to sway the 2020 election; the antics of Judge Emmet Sullivan in the Flynn case. . . .

And then on to a whole new round of frolics under “Joe Biden” including the malicious prosecutions of J-6 protesters; the pipe-bomb caper at the DNC; the use of several agencies to censor speech and manage the news media; the treasonous negligence of Alejandro Mayorkas on the nation’s borders; the DOJ-coordinated lawfare hounding of Mr. Trump and his adjacent lawyers; the Ukraine War project ginned up by the State Department’s Victoria Nuland and cohorts; and the sinkhole of greed, malice, and medical homicide that was the Covid-19 operation, millions killed and disabled, and likely more of that yet to come from the vaccines, trillions in wealth purloined or just plain lost, and businesses destroyed in lockdowns. It’s not a mere “swamp,” it’s a whole forbidden planet of turpitude.

Then there are the floaters and freelancers who move from one blob venue to the next, like lawfare artists Mary McCord, Norm Eisen, Marc Elias, David J. Kramer, or the girl-band of Lisa Monaco, Fiona Hill, Kathryn Ruemmler, Susan Rice, Samantha Power, Nellie Ohr. And finally, there are the real big fishes: Barack Obama, Hillary Clinton, Bill Gates, Anthony Fauci, Chris Wray, Merrick Garland, General Milley, and “Joe Biden.”

Add William Barr to that list for failing to reveal that he was in possession of Hunter’s laptop as early as the fall of 2019. Of course, it was crammed with exculpatory evidence that could have ended impeachment No. 1 on day one of the initial hearings, yet he never alerted President’s lawyers to its existence. Weird, a little bit. And also, for the effrontery of allowing Jeffrey Epstein to be killed in his Manhattan jail, and never offering the public a coherent account of how the cameras on the cellblock failed, or why the guards who fell asleep on-duty were disciplined with only 100 hours of “community service.”

My Gawd, they must be eating Xanax like tic-tacs in their drawing rooms and boudoirs as the name Kash Patel floats across their social media screens. Kash Patel, a real-live exterminating angel, will finally step in to the FBI Director’s office and turn the investigative powers of the FBI on. . . the FBI! And its parent, the DOJ. The poetic justice is sublime. You must wonder: how does Mr. Patel get through the RINO-infested Senate confirmation process? Start with: what have they got him? Answer: probably not a goshdarn thing, not a hair out of place. More to the point: what has Mr. Patel got on them? (Especially Messers Thune, Barrasso, Cornyn, and let’s just throw in the Democrat Mark Warner, VA, who was up to his eyeballs in RussiaGate as chair of the Senate Intel Committee.)

And were Mr. Patel to land in the FBI Director’s office 49 days from now, what additional info might he uncover about years of weaponized government with assistance from John Ratcliffe at the CIA and Tulsi Gabbard as DNI — who will access a pipeline to the vast national security server farm out in Bluffdale, Utah. So, in case you think that the document-shredding party currently underway in DC will conceal all that criminality, consider what lives forever in the alternate universe of cyberspace. There are additional NSA intel server farms in Fort Meade, MD, Augusta, GA, and San Antonio, TX, all with troves of agency emails and cell phone texts. Not to mention what whistleblowers-to-come might have saved on their thumb drives. And you may be sure that the whistles will be blowing, even while the culpable rat each other out. Remember too: there is the document dossier of FBI crimes that Mr. Trump had in his personal possession after leaving office— the reason for the FBI raid on Mar-a-Lago, August, 2022, and Jack Smith’s bullshit court case to justify it.

In a new wrinkle to things transitional, you have the news late Sunday that “Joe Biden” issued a blanket pardon to “the smartest person I know,” Hunter Biden, that covers every last criminal act he committed from January 1, 2014, to present, including bribery, wire fraud, money-laundering, trafficking minors for sex, handgun violations, tax evasion, crack-cocaine parties, and probably more.

“JB” assured America more than once that he would never pardon Hunter. Turned out to be the joke that all his utterances were supposedly not. But, really, did you expect anything else? Do you see now, also, why Hunter pled guilty to those tax charges in the LA federal court? I’ll tell you why: because in a trial all the mechanisms of the money transfers through a myriad of bank accounts would have been disclosed. And the money trail leads from the multiple accounts of Hunter’s Rosemont Seneca operation to the personal bank accounts of Biden family members, brother Jim and wife Sara, possibly Hunter’s half-sister Ashley, and, of course, “the Big Guy.” Where are their pardons? And where is “Joe Biden’s” pardon for Joe Biden?

It is unfortunate that the way forward (to a national government different in scale, scope, and disposition toward its citizens) will require so much consorting with what is past.

But it must be if consequence is to be restored as a basic element in our constitutional arrangements. You can’t just have people doing stuff outside the law because they feel like it.

Tyler Durden Mon, 12/02/2024 - 16:20

"Cold Weather Fails To Persist" Across Lower 48 Could Stall NatGas Rally

Zero Hedge -

"Cold Weather Fails To Persist" Across Lower 48 Could Stall NatGas Rally

Goldman's Thomas Evans distributed a note to clients this morning highlighting that the latest weather models show the Arctic cold blast, in place last week, is "failing to persist" across portions of the Lower 48, which could potentially cap the recent natural gas price rally. 

"A feature of winter weather in recent years has been an inability to persist cold patterns for two weeks at a time. This looks to continue with this upcoming cool stretch giving way to broad warmth returning across East and South in the 11-15 day," Evans wrote in the note. 

He said, "The models have not broken down the strong West coast to Alaska ridging that had been instrumental in funnelling cold air from Canada into the US – and for the moment just have the cold air retreating back into Western Canada." 

"If the ridging can be maintained there's a chance for another cold pattern for the East at the end of December, however the Polar Vortex is strong, which will make it harder to see serious cold spilling down from the Arctic," Evans noted. 

The latest weather models via Bloomberg show Lower 48 average temperatures are expected to rise above a 30-year trend into the mid-point of the month after a deep chill last week across the eastern part of the US. 

Evans provided color on what's happening in NatGas markets:

The market needed to bring some production back ahead of the current cold shot, and priced to do so over the course of last week. With production >4.5 Bcf/d above it's low in early November, producers have provided some reassurance that they'll be active in cash.  This reassurance coupled with a breakdown of the colder-than-normal weather pattern is being reflected in vol market softening today. While breakevens still look a little rich, call skew still scans as the more expensive expression in the front.

Meanwhile, in fixed price, we estimate CTAs flipped from short to long over the course of the past couple weeks – that new length looks vulnerable to any further deterioration in the weather outlook. If the balance of Dec rolls forward with a warmer outlook and Jan sells off below $3, the market will still want to keep some delivery risk (storm) premium in the F/H.  With H/J already back to ~2c, this will put pressure on widening the J/F unless the market wants to take premia out of the C26.  Given the path to balance tightening with LNG growth (and no new rigs going down in Haynesville) into X25H26, this (wider spreads, elevated back end) may be the right path forward, even though J/V is already wide for this point in the season.

NatGas futures trading in New York has jumped 52% since mid-October due to cold weather trends across the Lower 48. Prices have since hit resistance around $3.50 per million British thermal units. 

Latest NatGas coverage:

Keep an eye on 6-10-day and 8-14-day temperature outlooks via NOAA

Tyler Durden Mon, 12/02/2024 - 15:45

Yes, Mexico Knows Exactly What It Is Doing

Zero Hedge -

Yes, Mexico Knows Exactly What It Is Doing

Authored by Victor Davis Hanson via American Greatness,

President-elect Donald Trump recently had a “talk” with newly elected Mexican President Claudia Sheinbaum about the millions who have crossed through Mexico to enter the U.S. illegally.

Afterwards, Trump reported that their conversation went well, and supposedly both had agreed to secure the U.S. border.

But given long-standing, de facto Mexican policy to rely on and profit from an open U.S. border, it was not long afterwards that Sheinbaum claimed she had not been so accommodating.

Or, as she now put it of the Trump conversation, “I give you the certainty that we would never—and we would be incapable of it—propose that we would close the border.” And of course, she is right: Mexico never would wish for a secure U.S. border, although it is wrong that she is incapable of guaranteeing one should she choose to do so.

What, then, is going on?

Over the last half-century, Mexico has gradually, even insidiously, developed both a one-sided, asymmetrical relationship with the U.S. based on professed mutual benefit and yet sought to leverage America by claiming it is supposedly guilty for two centuries of oppressive treatment.

How does the strange U.S.-Mexico supposed co-dependence seem to work?

The Mexican government has traditionally seen the U.S. as an endlessly wealthy country, liberally governed, and more or less willing to listen to Mexico’s grievances of the sort that are common in asymmetrical partnerships.

About 60 percent of the Mexican people traditionally in polls have voiced a positive view of the United States, yet a surprisingly low number when considering the millions who try to cross its border illegally each year.

Nonetheless, Mexico for decades has conveniently explained the vast influxes across the border, unaudited and illegal, as largely in America’s interests - and mirabile dictu even to Mexico’s disadvantage. Polls tell, however, a vastly different and far more accurate story.

Logically, some 61 percent of Mexicans in a recent 2024 Pew Center Research Poll voiced favorable views of the United States, whose open borders, generous welfare systems, billions of dollars in remittances, and now-defunct immigration laws they see as entirely in their interest. In contrast, 60 percent of Americans, one of the highest numbers on record, now hold unfavorable views of Mexico, perhaps because of the cynical harm it has done through a perforated border.

Mexico says its emigrants, along with those from Central and South America who cross its own borders with relative ease—often with tacit support—supply America with generations of industrious, low-cost labor, robbing it, in a sense, of millions of its own citizens.

It adds that the attractions of El Norte mean that Mexico must put up with human caravans crossing its own sovereign territory to supposedly meet the hungry American demand for labor, drugs, and sex. Indeed, nearly every recent Mexican president has argued that America’s thirst for lethal fentanyl is responsible for the creation of Mexican cartel lords that now run large swaths of Mexico itself.

However, the problem with such ancient and modern disingenuousness is that even if the United States accepted these excuses, apologized, and promised to close the border and keep clear of Mexican affairs, Mexico would grow even more irate. The reason why is that the current relationship has now grown unbalanced to the point of absurdity—sometimes evidenced in past polls that revealed a majority of Mexican citizens both believed in the mutually exclusive propositions that the American Southwest properly still belongs to Mexico and yet they wished to leave Mexico to emigrate to a non-Mexican northward if given the chance.

In truth, Mexico would face insolvency if it did not receive its current some $63 billion in U.S. remittances, largely sent by its own people who crossed into the U.S. illegally. Trump talks of levying a 25 percent tariff on Mexican imports should Mexico not cease undermining the American border. An additional lever would perhaps be to slap a 30 percent tax on all remittances sent from the U.S. to Mexico. That would both encourage capital to stay in the U.S. and raise over $20 billion in excise fees, more than enough proverbially to “pay for the wall.”

However, such largess is still more one-sided since much of the remittances are made available through not just the industriousness of Mexican expatriates but also the generosity of American taxpayers. Their multifaceted subsidies to the undocumented free up billions for them to help support millions of Mexico’s poor in a fashion that Mexico City apparently is either unable or unwilling to ensure.

The annual flight of millions from Mexico is a sort of updated version of Frederick Jackson Turner’s “frontier safety valve theory” of the American West. Accordingly, the Eastern poor and potentially rebellious fled westward in hopes of a new, better life rather than marching on Washington for cancellation of debts or redistribution of property. Mexico City apparently feels that without their own El Norte “frontier,” millions of southern and indigenous Mexican citizens might instead head en masse to Mexico City.

As for the cartels, Mexico knows well that China sends raw fentanyl to its country unimpeded, where cartel factories prepare it for export to America’s addicted and recreational users. There, disguised as less toxic drugs and even foodstuffs, fentanyl will end up killing up to some 100,000 Americans a year—an annual death toll nearly double the total number of U.S. fatalities in the Vietnam War.

Mexico, which also helps China avoid tariffs on its exports to the U.S. by assembling its products in NAFTA and tariff-free Mexico, certainly knows that the Chinese seek both to profit from its cartel ties and to kill Americans and undermine its security in the bargain.

The macabre gambit is likely seen as the Chinese version of an updated Opium War payback, with the twist that the former addicts are now the suppliers.

In an equally sick way, the cartels infuse into the Mexican trickle-down economy, albeit in nefarious and criminal ways, some $30 billion in additional U.S. dollars from Americans addicted to imported Mexican-made drugs tailored for the U.S. market. The presidents of Mexico usually say little about this second source of billions in U.S. foreign exchange or claim American addicts, not Mexican suppliers, explain the growing death and destruction on both sides of the border.

While in office, former President Obrador often said strange things. Two of the most pugnacious were his high-five boast that some 40 million of his own citizens had fled Mexico to cross the border: “Just imagine. There are 40 million Mexicans in the United States—40 million who were born here in Mexico, who are the children of people who were born in Mexico.” (Obrador never explained why his own citizens would willingly flee their own country to a nation habitually caricatured in the Mexican press as racist and exploitive.)

Obrador also periodically delighted in interfering in US elections by urging Mexican expatriates in the U.S. to vote against all Republicans, presumably because they seemed at times to threaten to kill the Mexican golden goose of illegal immigration.

Indeed, in 2023, Obrador urged American Hispanics to never vote for Ron DeSantis’s presidential primary campaign—an irony given Mexico’s chronic complaint of Yanqui interference in Latin American politics.

Obrador believed, as many presidents before him no doubt concurred, that the 40 million expatriates and Mexican-American children, if they were distant from Mexico long enough, would romanticize the country, and so, like most immigrants, become a powerful lobbying force on Mexico’s behalf.

In La Raza literature of the past, and in Mexico’s chauvinistic moments, illegal immigration was envisioned as the ironic response to the ancient “theft’ of the American Southwest. The problem with that thesis is that most Mexicans, as polls have shown, would prefer to live in an American Southwest than a Mexican south.

And it is also increasingly likely that Mexican-Americans will be more prone to vote for border security than open borders—again further proof that their self-interest as patriotic Americans trumps Mexico’s cynical attempts to use them as political pawns. If those trends continue, the American Left and the Mexican government may well lobby for a secure border, in fear they are only augmenting a growing MAGA constituency.

In sum, Mexico understands the myriad ways that an open border, the destruction of U.S. immigration law, illegal immigration, and emigration of millions of its own citizens to America are entirely in its own interests and so hopes to see the continuation of the Biden-Harris-Mayorkas appeasement.

But, given the huge numbers of human trafficking, the chaos, the drugs, the violence, and the financial costs of supporting millions, an open border is increasingly seen by Americans as not to their advantage—as we saw in the recent Trump victory. That reality, not the rhetoric of Mexican presidents, will govern all future negotiations—a truth that President Sheinbaum should digest before she sounds off about a border that she knows her country has done so much to deliberately destroy—and to America’s detriment.

Tyler Durden Mon, 12/02/2024 - 15:25

The Democratic Diaspora: Liberals Seek Safe Spaces After Democracy Prevailed In 2024

Zero Hedge -

The Democratic Diaspora: Liberals Seek Safe Spaces After Democracy Prevailed In 2024

Authored by Jonathan Turley,

Democrats who campaigned on the need for “joy” and “saving democracy” are strikingly unjoyful about the results of the democratic process in 2024.

Before the election, slips like the one of President Joe Biden calling Trump supporters “garbage” were immediately denied or deflected. But once voters had given the Republicans control of both houses of Congress, the popular vote and the White House, leading Democratic figures and celebrities dropped all pretense of civility. They are now being open about their contempt for voters, calling them “f—-ing morons” and “arrogant, ignorant” adolescents.

After calling for Americans to come together for Kamala Harris, MSNBC’s Joy Reid sent out a heart-warming holiday message to those who voted for the GOP to “make your own dinner, MAGA. Make your own sandwiches, wipe your own tears.”

Those not wallowing in Reid’s anger are increasingly voicing themes of isolation, insurrection and secession.

For years, the contempt for Trump voters has been open and obvious in much of the media.  The “Let’s Go Brandon” movement captured the lunacy of the press and politicians simply denying what citizens could see, hear and experience for themselves.

When asked for answers on issues like the economy and immigration, Harris paraded an army of celebrities to tell the public how to vote — shiny objects that they thought would be enough for shallow American voters.

They were wrong. Now that the public has made its choice, leading figures are condemning the majority of voters as a mix of misogynists, self-haters and fascists. Whoopi Goldberg, 69, even joined the “4B” sex strike against men. Others seem to be morphing into exactly what they said Trump would become as president: isolationist and insurrectionist.

Some have responded to the losses by retreating further into echo chambers protected from opposing views. Many dumped X in favor of BlueSky, a new social media safe space for liberals who fear being triggered by opposing views. Notably, censorship advocates such as Nina Jankowisz have fled to BlueSky.

The site is portrayed as a return to the good old days when liberals controlled all of the social media and maintained a massive censorship and blacklisting system over political discourse.

New York Times tech reporter Kevin Roose wrote a column last week that offered the familiar “I can breathe again” account: “After an hour or so of scrolling through Bluesky the other night, I felt something I haven’t felt on social media in a long time: free.”

It is the ultimate irony. This election shocked many on the left precisely because they were writing and commenting on each other within their hardened media and political silos. They are unlikely to improve themselves by receding further into that safe space to rave about the “f—ing morons” who make up the majority of America.

Other Democratic politicians have moved beyond the chest-pounding of leaders like Illinois Gov. J.B. Pritzker (D) to pledges of more direct obstruction or inflammatory rhetoric.

Denver mayor Mike Johnson (D) declared that he was preparing the Mile-High City for its “Tiananmen Square moment” to fight the federal government in any attempt to deport unlawful migrants. Johnson warned that he would have not only Denver police “stationed at the county line to keep [ICE] out” but also “50,000 Denverites.”

Not long ago, Democrats were calling similar protests an “insurrection.” Johnson later walked back his remarks but insisted that his city would fight federal efforts to enforce the immigration laws.

Rather than such trench warfare, most Democratic governors and mayors are simply pledging not to cooperate with federal authorities, which is a lawful choice. The concern, however, is how others will react to the overheated rhetoric for months that this will be “our last election” and that Trump is the new Hitler.

Such rage rhetoric gives people license to say and do things they would not ordinarily say or do. Leaders calling on citizens to “fight” ICE and the “fascists” can easily inspire violence, as we have seen in past years. Indeed, that was the very premise of the criminal case against Trump supported by many of these same leaders, alleging that his calls to “fight” against certification was a call for insurrection.

Some liberals are very publicly fleeing the country. Sharon Stone (who called American voters “uneducated”) is reportedly off to CanadaEllen DeGeneres and Portia de Rossi are off to a mansion in Cotswolds in England. Democratic megadonor Reid Hoffman is also reportedly exploring a departure from the country after his millions of dollars failed to produce a victory for Kamala Harris.

Some, however, want to take part of the country with them. New York State Sen. Liz Krueger (D-Upper East Side) has received praise for her call for New York to join Canada. Where Alexandre Dumas believed that ‘Nothing succeeds like success,” some believe that, after losing an election, nothing succeeds quite like secession.

Krueger previously sought to block Trump from the ballot in the name of protecting democracy. That would have barred the 45 percent of New Yorkers who voted for the president-elect, but those voters would find themselves either Canadians or refugees under her proposal.

Krueger suggested that secession simply makes sense when the majority of the country disagrees with you. She believes New York, Connecticut, Massachusetts and Vermont could form a new Canadian province.

“I got back some unofficial responses and heard this is probably sellable in Ottawa,” she said.

“And look, if we were Europe, in the length of time we’ve been a nation, for Canada, if we were European countries, our borders would have moved around 20 times by now, right?”

She explained that this is all just “thinking outside of the box.”

The box that she and other liberals find themselves in is called “democracy,” and they don’t like it.

Just for the record, the last time people thought “outside the box” and seceded, we got a war with roughly 700,000 people killed.

Yet, assuming New Yorkers can get used to milk in a bag and cheese curds as a snack, there may be an obvious appeal for the left in the True North. Formerly “strong and free,” Canada has become a nightmare for free speech with the ever-expanding criminalization of political speech. One professor, who said that Trump’s plans to combat censorship has left many frightened, said that if free speech protections are restored, “I will be on a plane [out of America].”

For New York Times reporters and officials alike, they will be able to “breathe again” in the controlled, regulated air of censorship countries like Canada.

The only challenge for our displaced and disgruntled diaspora will be that Canadians tend to be nice.

*  *  *

Jonathan Turley is the Shapiro professor of public interest law at George Washington University and the author of “The Indispensable Right: Free Speech in an Age of Rage.”

Tyler Durden Mon, 12/02/2024 - 14:45

Trump Warns Hamas Of "Hell To Pay" If Hostages Aren't Freed Before Inauguration

Zero Hedge -

Trump Warns Hamas Of "Hell To Pay" If Hostages Aren't Freed Before Inauguration

It's no secret that President-elect Donald Trump is firmly in support of Israel, despite that after a year of Israeli war in Gaza the civilian death toll is in the multiple tens of thousands. Trump has stacked key national security positions with pro-Israel hawks. 

This is why it comes as no surprise that he's already talking tough, threatening escalation if Hamas and Palestinian militants in Gaza don't immediately free the remaining Israeli hostages. "Everybody is talking about the hostages who are being held so violently, inhumanely, and against the will of the entire World, in the Middle East - But it’s all talk, and no action!" Trump began a post on his Truth Social.

He is warning that there will be "hell to pay" if Hamas doesn't release the captives. "Please let this TRUTH serve to represent that if the hostages are not released prior to January 20, 2025, the date that I proudly assume Office as President of the United States, there will be ALL HELL TO PAY in the Middle East, and for those in charge who perpetrated these atrocities against Humanity," Trump continued in the statement.

He then warned in the stern statement [emphasis ZH]:

Those responsible will be hit harder than anybody has been hit in the long and storied History of the United States of America. RELEASE THE HOSTAGES NOW!

Given broad swathes of Gaza have already been pulverized into dust, it's hard to see how the Strip could be hit any harder, also given US-supplied bunker buster bombs have been used against dense urban areas.

A total of 97 hostages remain unaccounted for, though many have been feared dead after over a year of fighting in the Strip. Israel has said that 251 Israelis and foreigners were taken on October 7, 2023.

Recent analysis in The Washington Post tallied that 117 hostages have been freed or rescued, with the bulk of this figure having come as a result of the November 2023 short-lived truce deal.

Israel's military and intelligence believes that a total of 63 hostages remain alive. They have been in captivity for over 420 days, amid worsening conditions. Israel says that 71 have been confirmed killed, but without revealing the precise circumstances of their deaths.

"The hostage whose death was most recently confirmed by Israel is Idan Shtivi," Washington Post writes. "There are 34 hostages reported killed whose bodies have not been recovered and remain in Gaza."

Prime Minister Benjamin Netanyahu will surely take this new statement as a mandate from Trump to keep fighting. Efforts at achieving a new truce completely fell apart within the last weeks, and Israel appears bent on pursuing a military solution.

Given the situation is now essentially a 'fight to the death' scenario, Hamas and Palestinian Islamic Jihad are unlikely to care much about Trump's threat. The terror groups likely see the remnant hostages as the only remaining leverage they have left.

Tyler Durden Mon, 12/02/2024 - 14:25

If Cash Is King, Is The King Dying?

Zero Hedge -

If Cash Is King, Is The King Dying?

Authored by Gregory Copley via The Epoch Times,

Much of the world is at a pivotal stage in the future of money. If the physical symbolism of cash is removed or diminished, so too is individual freedom and much of the inspiration for entrepreneurship.

Proposals to make cash entirely digital gives a new meaning to governments as “controllers of the currency”; it makes them controllers of the lives of individuals.

Economists, politicians, and the avaricious tend to think that cold, hard cash - the physical kind - merely gets in the way of a deal which can be “interpreted” in many invisible currency forms, such as credits, promissory notes, and abstract assets.

Nonetheless, it is currency which reflects the prestige and power - or lack of them - of a society.

The bulk of the “value” or wealth of most societies today, however, is measured not in currency or hard assets, such as real estate or manufactured items, but in the abstracts of economies, such as creditworthiness. Our wealth, somehow, is “up in the air” out there, somewhere, to a far greater degree than at any time in human history. The old control mechanism of economic leaders, money supply (the physical amount of currency notes or coins in circulation, an aspect known as M1), no longer counts for much, a reason why central banks are less than effective in controlling economic trends.

How does this augur for the future stability of economies or the security of societies?

It first must be recognized that all currencies are “artificial” forms of value exchange. A dollar is worth a dollar if we believe it represents a dollar’s worth of value. And if inflation consistently reduces the purchasing power of that dollar (or euro, or pound, and so on), then at some stage the public will lose faith in it. Significantly, that “faith” parallels and is the handmaiden of trust in the government which issues the currency. It gets down to the reality that currency, governments, prestige, and influence—strength—are all given power only by the mind.

When a society loses its belief in the value of a currency or a government, or if a nation loses its willpower or confidence, then the currency or the government or the nation collapses. And when the overwhelming amount of wealth is measured digitally, rather than in the physical imagery of printed or minted money, it is difficult for it to be seen as anything other than transitory and ephemeral.

U.S. society has had such a sentimental association with its coinage—even the one-cent (penny) piece—that successive U.S. governments have been unwilling to risk public wrath by abandoning it. And this sentimentality has played a strong role in the limiting of inflation over the decades. That may be at an end as the U.S. government has toyed with moving to forms of a digital currency which could be used to control the movement and attitudes of all citizens. This has occurred in the People’s Republic of China.

Bluntly put, the digitalization of money is a major component in the infringement of freedom, given that digital currency is controlled not only by a central (governmental) authority, which can open or close access to funds, but is also dependent upon the absolutely unbroken delivery of electricity supply through a highly-complex structure of communications and computer links. Little wonder, then, that cryptocurrencies have gained some appeal, because they are, ostensibly, outside the grasp of governments. But they are not outside their dependence on electricity.

The appeal, then, of gold as a trading currency has increased in direct proportion to the distrust in governments, but, again, gold is an artificial currency in that it only represents value because of its global recognition and relative rarity. Gold cannot be eaten; nor can it, in itself, represent shelter or security. It is another abstract, supported as a psychological hedge against the fiat currencies of governments. Gold’s value is sustained by the fact that it is one of the “noble metals”—metals which resist corrosion—but it is only one of a number of such metals, all of which have some industrial value as well.

Where there is a significant overlapping between government-issued currencies and gold or silver coins is in the prestige given to the money by the appearance of a sovereign’s head on the paper or coin. This gets back to the concept of the psychological value of currency, tying it to the prestige of the sovereign, an image above party politics. This places great importance on the design and quality of the currency, to give it—particularly in the case of coins—an intrinsic as well as symbolic value.

The United States and other republics have had prestigious coinage, and these coins have usually had an iconic leader on them, and are minted continuously after the death of the figurehead (in the United States, such figures as Washington, Lincoln, or Benjamin Franklin). They have, like the new coins and banknotes now appearing with King Charles III on them, an imagery stimulus value; in short, prestige.

The world can no longer grow consistently without abstract forms of credit and currencies, given the reality that economic growth trajectories are driven by the ability to turn money over as frequently as possible.

So it is not that a return to a physical cash economy is desirable. Rather, it is important that the basis of a country’s economic stability is intrinsically tied to the prestige which its physical currency holds.

Inflation is—or was—held in check when the values of small coins were retained.

Many of us no longer bother to keep coins in our pockets. We relegate them to a storage jar in the kitchen. Some no longer carry paper currency. We rely on credit or debit cards, or their equivalent accessed through a cellphone (good only as long as it has electrical power). Much of this is a tribute to inflation, or the relegation of purchasing power to thoughtless electronic transactions, reflecting wealth in a world which lives only as long as the electrical spark survives.

A silver Maria Theresa thaler, however, will see you fed in areas where credit cards and modern currencies have no sway, in the mountains of Oman or Ethiopia, or the vastnesses of Arabia or Africa. Empress Maria Theresa, whose face is on the coin, ruled only from 1740 to 1780. She would have died contented if she had known how her prestige governed the lives of so many people more than 200 years after her death.

*  *  *

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

Tyler Durden Mon, 12/02/2024 - 14:05

Freddie Mac House Price Index Increased in October; Up 3.7% Year-over-year

Calculated Risk -

Today, in the Calculated Risk Real Estate Newsletter: Freddie Mac House Price Index Increased in October; Up 3.7% Year-over-year

A brief excerpt:
Freddie Mac reported that its “National” Home Price Index (FMHPI) increased 0.45% month-over-month on a seasonally adjusted (SA) basis in October. On a year-over-year basis, the National FMHPI was up 3.7% in October, down from up 3.8% YoY in September.  The YoY increase peaked at 19.0% in July 2021, and for this cycle, bottomed at up 0.9% YoY in May 2023. ...

Freddie HPI CBSAFor cities (Core-based Statistical Areas, CBSA), here are the 35 cities with the largest declines from the peak, seasonally adjusted. Austin continues to be the worst performing city. However, 18 of the 35 cities with the largest declines are in Florida!

And 5 of the 35 cities on the list are in Texas.

Sullivan Touts 'Massive Surge' In Arms To Ukraine With 50 Days Left In Biden's Term

Zero Hedge -

Sullivan Touts 'Massive Surge' In Arms To Ukraine With 50 Days Left In Biden's Term

National Security Adviser Jake Sullivan took to the Sunday news shows where he boasted that the White House is surging as many weapons as possible to Ukraine in the final days of the Biden administration.

He explained to ABC News that with just 50 days left in Biden's term, the White House is busy trying to "get Ukraine all the tools we possibly can to strengthen their position on the battlefield."

"President Biden directed me to oversee a massive surge in the military equipment that we are delivering to Ukraine so that we have spent every dollar that Congress has appropriated to us by the time that President Biden leaves office," he said.

NurPhoto/Reuters

Biden and his top officials have long pledged to support Ukraine with arms and funding "for as long as it takes" to defeat Russia.

But Sullivan and other defense officials have of late begun to acknowledge the inevitability of the Zelensky government having to enter negotiations with Moscow. For the time being, Sullivan said Washington aims to "give Ukraine as many tools as possible so that they could go into that negotiation and feel they could achieve the outcome that they would like to see."

Still, Sullivan sought to reiterate in the ABC appearance that the "key thing" behind potential negotiations to end the war is that Ukraine’s destiny should "not be imposed by outside powers, including the United States."

Concerning a recent NY Times report that suggested some US officials want to see nuclear weapons given to Ukraine, Sullivan dismissed this as a possibility:

Still, Sullivan debunked a report suggesting that the administration is open to returning nuclear weapons to Ukraine.

"That is not under consideration. No. What we are doing is surging various conventional capacities to Ukraine so that they can effectively defend themselves and take the fight to the Russians, not nuclear capability," he told Karl.

As for dealing with the incoming Trump administration, Sullivan confirmed there is contact on handing "off the baton" - though Trump has vowed to immediately negotiate an end to the war. 

"I've encouraged the Ukrainian team to engage the incoming team as well as to engage all of our allies and partners, because, again, on Jan. 21, the war in Ukraine doesn't just go away," Sullivan said.

He added: "Obviously, the new team will have its own policy, its own approach, and I can't speak to that, but what I can do is make sure that we put Ukraine in the best possible position when we hand off the baton."

But the Biden administration's policy has really only been a recipe for uncontrollable escalation. A 'massive surge' of new military equipment assures a prolonging of the war, even as it's become clear that Ukraine's real problem is manpower, and as Russian gains are evident in the east.

Tyler Durden Mon, 12/02/2024 - 12:25

Oil Producers Block Binding UN Treaty To Curb Plastics

Zero Hedge -

Oil Producers Block Binding UN Treaty To Curb Plastics

Authored by Tsvetana Paraskova via OilPrice.com,

A small group of major oil-producing countries, including the leaders of the OPEC+ alliance – Saudi Arabia and Russia – have blocked a United Nations-backed summit from agreeing on a binding treaty to put limits on the production and use of plastics.

To address plastics pollution, the UN convened a summit in Busan, South Korea, where delegates have been discussing the idea of a plastics treaty since November 25.

The UN has said that the talks would be “essential” to deal with plastics pollution, but these talks and the summit adjourned without a deal being reached.

Countries negotiating a legally binding instrument on plastic pollution concluded their fifth session in the small hours of Monday in Busan, with plans to reconvene in 2025, the UN said, adding that “Despite intense discussions, delegates recognised the need for more time to address divergent views and refine the treaty’s framework.”

Oil producers, including Saudi Arabia and Russia, have balked at the idea to curb plastics.

“There should be no problem with producing plastics,” Abdulrahman Al Gwaiz, the delegate from Saudi Arabia, said during the meeting’s final plenary session.

“The problem is the pollution, not the plastics themselves,” Bloomberg quoted Abdulrahman Al Gwaiz as saying.

Russia, for its part, argued at the summit that efforts to limit plastic production were motivated by economic reasons.

Petrochemicals, from which plastics are made, are expected to drive global oil demand growth in the coming years and decades, even if demand for road transportation fuels wanes.

That’s why it is no surprise that the biggest petrostates depending on oil revenues, such as Saudi Arabia and Russia, aren’t keen on agreeing on limits to plastics production.

Moreover, lobbyists from chemicals and fossil fuel companies were heavily represented at the talks in Busan, according to an analysis by the Center for International Environmental Law (CIEL).

As many as 220 fossil fuel and chemical industry lobbyists had registered to participate in the Intergovernmental Negotiating Committee (INC-5) to advance a global plastics treaty. That was the largest single delegation at INC-5, outnumbering even the host Republic of Korea’s 140 representatives, CIEL said.

Tyler Durden Mon, 12/02/2024 - 12:05

Syrian & Russian Forces Step Up Air Raids, Slowing Jihadist Advance

Zero Hedge -

Syrian & Russian Forces Step Up Air Raids, Slowing Jihadist Advance

Russian President Vladimir Putin on Monday spoke by phone with his Iranian counterpart Masoud Pezeshkian in talks that focused on the crisis in Syria, at a moment that Turkey-backed jihadists have threatened the central Syrian city of Hama after their shock capture of Aleppo.

"Attention was focused on the escalating situation in the Syrian Arab Republic. The major aggression of terrorist groups and gangs is views as aimed at undermining the sovereignty, political, social and economic stability of the Syrian state," a Kremlin statement said.

Both Russia and Iran pledged "unconditional support" for Damascus according to Russian state media, but there was also mention of the need to engage Turkey within the framework of the Astana agreement.

Via AFP

"We of course continue to support Bashar al-Assad and we continue contacts at the appropriate levels, we are analyzing the situation," Kremlin spokesman Dmitry Peskov told a press briefing. 

President Pezeshkian on the same day held phone talks with Syrian President Bashar Assad, who just within the last days had visited Moscow, at the moment Aleppo was being attacked.

The attack out of Idlib began on November 27 and within a few short days the major northern Syrian city, and long-time industrial hub of the country, came under the control of Al Qaeda splinter group Hayat Tahrir Al-Sham (HTS) and allied factions. 

An Al Jazeera corresponding reporting from the Syrian-Turkish border has said the HTS advance has slowed after its initial momentum against the Syrian Army.

"Syrian and Russian jets have intensified air attacks in Idlib city and positions in Aleppo as the government of President Bashar al-Assad tries to slow the advance of opposition fighters," the report says.

"The raids on Monday followed big gains by the opposition over the past few days that has greatly shifted the front line in Syria’s long-running war." According to more:

"The advances by the Syrian opposition continue on the battlefront, but not as fast as before. The acceleration is down as the diplomatic efforts to discuss the crisis have risen within the last two days," Koseoglu said.

However, opposition fighters are still on the outskirts of Hama, south of Aleppo. Elsewhere, they have seized most of the city of Tel Rifaat, where Kurdish-led Syrian Democratic Forces (SDF) are calling for a humanitarian corridor to allow Kurds to safely evacuate.

In areas of northern Aleppo, Kurds reportedly been engaging the Sunni insurgents in firefights. Dozens of Iran-backed Iraqi militia units have been coming from across the border into eastern Syria, ready to support Syrian national forces.

The HTS terrorists and their political backers say they want nothing less than political transition in Syria, or essentially regime change. This has long been the goal of the anti-Assad drive for well over a decade, also generally supported by NATO intelligence services and the Gulf states.

Tyler Durden Mon, 12/02/2024 - 11:45

Rabobank: Biden's Pardon Risks Further Erosion Of Confidence In The US Government

Zero Hedge -

Rabobank: Biden's Pardon Risks Further Erosion Of Confidence In The US Government

By Benjamin Picton, Senior Macro Strategist at Rabobank

Pardon?

US stocks rose in shortened trading on Friday, with both the Dow and the S&P500 closing at fresh record highs. Consequently, November marked the best month of the year for the S&P500 as the index finished 5.73% higher, beating February’s 5.17% rise into the silver medal position.

European stocks also rose with the CAC40 up 0.78% and the German DAX up 1.03%. Confidence in Europe was buoyed slightly by a commitment from Marine Le Pen that she wouldn’t bring down Michel Barnier’s government before the weekend over deep disagreements on Barnier’s budget. Despite the stay of execution, the two sides appear to have irreconcilable views over social spending, and its hard to see a situation where Le Pen’s National Rally allows Barnier’s more neoliberal administration to survive into the new year.

Yields on 10-year OATs fell by ~5bps on Friday and French bonds underperformed German Bunds as November CPI data showed a quicker pace of disinflation in France. Nevertheless, the political instability has taken a toll on French borrowing costs as illustrated by outperformance of Greek 10-year bonds on the day and the parity between Greek and French yields (!). Bloomberg reports that some French corporates are now experiencing lower borrowing costs than the national government.

Meanwhile, over in Germany the far-right AfD published a draft policy platform outlining plans to campaign on policies to leave the EU, the Paris Climate Accord and the Euro if the party is successful in forming government at the early election expected in February. The draft policy platform also includes proposals to roll back economic sanctions on Russia and recommission the Nord Stream natural gas pipelines, but still needs to be voted on by AfD members in mid-January. The draft platform marks a break from the manifesto published ahead of EU parliament elections in June, which did not include a firm commitment to take Germany out of the EU.

USDJPY sank below the key 150 level on Friday as Tokyo CPI came in hotter than expected on both the headline and ex-fresh food measure. Even the ex-fresh food and energy measure was up 1-tick on the October reading, prompting a slight lift in futures implied probability of a rate hike at the BOJ’s policy meeting on December 19th. The OIS strip currently has a hike of 16.5bps priced in for the December meeting.

On the geopolitics front the swift dismantling of Hezbollah by Israel, and Russia’s preoccupation with its war on Ukraine appears to have come at great cost for Syria’s Bashar al-Assad. Rebel forces recaptured the country’s second largest city of Aleppo as regime troops were left somewhat stranded by Russian, Iranian and Hezbollah allies and were consequently overwhelmed by the Turkish-backed rebels.

In a situation similar to Yemen, civil war has been raging in Syria for 13 years without attracting a great deal of mainstream interest in Western media. In the case of Yemen, that all changed once the civil war impacted upon freight transits through the Suez Canal, while in Syria the ongoing competition for spheres of influence by Great Powers (Russia, USA, China, Saudi Arabia, Turkey, Iran, Israel etc) provides a useful microcosm of the new global paradigm, but only if one cares to look.

Speaking of new paradigms, Australia’s governing Labor Party struck a deal with the left-wing Greens last week to push through proposed reforms of the RBA. The reforms will create a dual board structure at the central bank, splitting responsibility for monetary policy decisions off from the operational and governance oversight of the bank. Australia’s centre-right opposition parties dealt themselves out of negotiations with the government over the reforms due to fears that the government would use the restructure to “sack (fire) and stack” the monetary policy board with political appointments who might be inclined to cut interest rates ahead of the Federal election due by May next year.

The Greens have been vocal critics of the RBA’s tightening of monetary policy and had previously said that they would only support the government’s RBA reforms if the Treasurer invoked never-before-used powers that allow him to override monetary policy decisions. Treasurer Jim Chalmers had planned to abolish that power and another provision that grants the RBA power to direct bank lending activities. Both of those powers might be useful in a world of increased geopolitical competition where free trade is taking a back seat to state aims and industrial policy is becoming de rigeur again.

Finally, the Wall Street Journal is reporting that President Joe Biden has pardoned his son, Hunter Biden, for federal gun and tax charges despite earlier vows not to intervene. President Biden said that it was clear that Hunter had been “treated differently” by the Justice Department. While this news itself is not immediately market sensitive, Biden’s suggestion that Justice Department prosecutions have not been blind to political considerations in the case of Hunter Biden perhaps risks legitimising President Trump’s claims of unfair prosecution directed against him, and further erosion of confidence in the USA’s institutions of government.

That could certainly have long-term implications for borrowing costs, transmission of monetary policy and a host of other variables.

Tyler Durden Mon, 12/02/2024 - 11:25

Great Thanksgiving Pilgrimage: Sunday Was "Busiest Day Ever For TSA"

Zero Hedge -

Great Thanksgiving Pilgrimage: Sunday Was "Busiest Day Ever For TSA"

US airlines are trading slightly higher in the early cash session after new Transportation Security Administration (TSA) checkpoint data revealed that Sunday marked the "busiest day ever" at airports nationwide.

TSA checkpoint data indicated that officers screened 3,087,393 passengers across airports, a 33% jump from the same day one year ago. 

This marks a new daily record.

More details from TSA were shared on X.

In markets, the S&P 500 Passenger Airlines Index edged slightly higher on the news. While the index has not recovered to pre-pandemic levels, it has risen 57% year-to-date.

AAA projected that nearly 80 million Americans would travel more than 50 miles, either by road or air, ahead of last week's Thanksgiving holiday.

Beyond soaring air travel demand, consumers also flocked to movie theaters in record numbers.

Is America truly back after the post-Covid funk?

Tyler Durden Mon, 12/02/2024 - 11:10

Construction Spending Increased 0.4% in October

Calculated Risk -

From the Census Bureau reported that overall construction spending increased:
Construction spending during October 2024 was estimated at a seasonally adjusted annual rate of $2,174.0 billion, 0.4 percent above the revised September estimate of $2,164.7 billion. The October figure is 5.0 percent above the October 2023 estimate of $2,071.1 billion.
emphasis added
Private spending increased and public spending decreased:
Spending on private construction was at a seasonally adjusted annual rate of $1,676.4 billion, 0.7 percent above the revised September estimate of $1,664.7 billion. ...

In October, the estimated seasonally adjusted annual rate of public construction spending was $497.6 billion, 0.5 percent below the revised September estimate of $500.0 billion.
Construction Spending Click on graph for larger image.

This graph shows private residential and nonresidential construction spending, and public spending, since 1993. Note: nominal dollars, not inflation adjusted.

Residential (red) spending is 4.7% below the peak in 2022.

Non-residential (blue) spending is 0.5% below the peak in June 2024.

Public construction spending is 0.5% below the peak in September 2024.

Year-over-year Construction SpendingThe second graph shows the year-over-year change in construction spending.

On a year-over-year basis, private residential construction spending is up 6.4%. Non-residential spending is up 3.5% year-over-year. Public spending is up 4.5% year-over-year.

This was above consensus expectations and spending for the previous two months was revised up.

"No Way Out" - French Credit Risk Spikes After Le Pen Confirms Backing Of 'No Confidence' Vote

Zero Hedge -

"No Way Out" - French Credit Risk Spikes After Le Pen Confirms Backing Of 'No Confidence' Vote

Update (1015ET): French credit risk surged after Le Pen's opposition party National Rally confirmed it will back a no-confidence motion brought by the Left's Manot (who confirmed he will do so on national TV), after PM Barnier used article 49.3 to push through a spending bill that crossed too many red lines.

“There is no way out for a government that reconnects with the thread of Macronism, which refuses to take into account the social emergency at the end of the month and which ignores the need to relaunch growth,” National Rally President Jordan Bardella wrote on X after the announcement.

"We will vote no confidence," the RN said on X.

Le Pen's RN party is the largest single party in parliament.

The left wing is also expected to back the motion, which could be held as early as Wednesday and if successful would topple the minority government after only three months in office.

French credit spread (to Germany) snapped higher on the news (even though it was expected)

French shares are also tumbling as the country's yields are now higher than Greece's...

If Barnier is evicted from office, Macron would have to re-appoint him or pick a new premier.

But the president would face the same difficult balancing act with no possibility for fresh legislative elections until July.

Any new government that emerges would still need urgently to propose a 2025 budget.

*  *  *

France’s benchmark yield spreads have come off the day’s wides after the latest headlines show the government may have made a further compromise in its bid to save the budget.

France’s government offered a final-hour concession to Marine Le Pen on the 2025 budget, seeking to avoid being ousted from power in a no-confidence vote.

Prime Minister Michel Barnier committed to not cutting reimbursements for medicines, caving to yet another key demand from the far-right after crisis talks with Le Pen earlier Monday.

The concession is a last-ditch attempt by the French premier to keep the budget bill on track and remain in office. Without a majority in parliament, Barnier was set to resort to using Article 49.3, which allows for the adoption of the social security bill without a vote, but opens the door to no-confidence motions.

Le Pen’s National Rally party, the largest in the lower house, said earlier Monday it would ensure the government falls, barring a “miracle” compromise on their demands. Party officials did not immediately respond to requests for comment after Barnier offered the concession.

However, at 83bps (spread to Bunds), French fragmentation risk remains as high as it has been since the EU financial crisis in 2013 ahead of the critical vote...

Source: Bloomberg

How Did We Get Here...?

Before the end of today's French parliamentary session, Barnier's government must submit the social security budget details to the National Assembly. As it stands, Barnier's center-right gov't cannot pass this unless National Rally (RN) provides support or abstains. Currently. Barnier's coalition has the most seats followed by New Popular Front (NFP) and then RN.

Barnier has already made clear he plans to pass the motion via Article 49.3, which allows the gov't to pass measures without a formal parliamentary vote but at the cost of opening the door to an immediate no-confidence motion.

In recent days Barnier made concessions to RN’s Le Pen around electricity taxes and certain other issues in order to get her support and avoid losing the no-confidence motion. However, Le Pen has made clear that RN has multiple red lines which need to be removed from the budget.

On Sunday, Le Pen announced that Barnier had ended the discussion' while more recently RN’s Bardella said "a no-confidence motion will likely be passed unless there is a last minute miracle”.

Ratings

S&P affirmed France at AA- on Friday, with a Stable outlook, recognizing Barnier's austerity plan to reduce the deficit. However, the agency warned that political fragmentation and the risk of diluted reforms could threaten long-term fiscal stability, and while it is optimistic about 2025's fiscal targets, it cautioned that the future trajectory beyond 2025 remains uncertain.

What Happens Next?

On Monday, 2nd December Barnier's gov't will announce they are passing the social security budget via Article 49.3. After which, opposition parties will be entitled to table a no-confidence motion.

The left-wing alliance NFP is expected to table such a motion. As a reminder. NFP secured the most seats in June's election but President Macron decided not to select the PM from that group and instead tried to form a centrist coalition with Barnier at its helm. As such, they have committed to tabling a no-confidence motion which will pass if, and only if. RN supports it.

If tabled, the motion will likely occur on Wednesday, 4th December. After Article 49.3 is used opposition parties have up to 48-hours to table a no-confidence motion which then needs to be voted on within three days. However, there is no reason for NFP not to table the motion immediately, hence Wednesday is the most likely day. For what it's worth. RN also appears to have a no-confidence motion ready to go.

Following this, the next step goes to President Macron who will attempt to appoint a new PM. get support around them and then pass the required fiscal legislation by year end to have a workable budget for 2025 and appease the European Commission. As a reminder, the Commission placed France under excessive deficit procedures due to its deficit being well in excess of the 3% debt/GDP ratio the commission allows.

In the event that Barnier survives the confidence motion then he has to return before end-December with the management component of the budget.

A bill which would also need Article 49.3 to pass and thus will open the door to another confidence motion.

If Barnier loses the motion then Macron will need to appoint someone to serve as the new PM.

In the short-term, Barnier would likely continue as a caretaker during which there are two backup options for the government: 1) usage of special legislation to rollover the 2024 budget for a brief period of time (this would not solve the pressing budget problems); 2) usage of a gov't order to pass the budget without vote, while this would pass the budget there would be no gov't to deliver it (Barnier couldn't as caretaker), thus Macron would need to appoint a new PM.

A government which would undoubtedly face even greater pressure from NFP and RN.

Le Pen

It is somewhat unclear as to what exactly Le Pen wishes to gain from the gov't collapsing.

As parliament cannot be dissolved until June 2025 at the earliest and while the gov't collapsing will put pressure on Macron to resign, he has made clear he will not do so.

There had been speculation that Le Pen’s stance was a negotiating tactic in order to obtain some of her red lines. If this is the case, then it is going to the wire.

Finally, the impact of this is not inconsequential...

It has historically cost the French government around 50bps more to finance itself for 10 years than it has the German government. France is now the euro-area’s biggest issuer of debt (ahead of Italy) and the country ran a huge budget deficit in 2024. The political turmoil created since Macron called a snap parliamentary election has seen that spread widen to around 85 bps.

Running the wider spread through our in-house model of the euro-area economies, and assuming it remains elevated through 2025, suggests a 0.5% drag on GDP will emerge by the end of next year.

Higher borrowing costs and slower growth would be a bad combination for public finances. The danger is that spreads widen further, exacerbating these impacts and creating ever bigger fiscal risks.

Tyler Durden Mon, 12/02/2024 - 10:15

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