Zero Hedge

Fifty Achievements In Fifty Days

Fifty Achievements In Fifty Days

Authored by Jeffrey Tucker via The Epoch Times,

Many friends of mine are frustrated at what they consider slow progress from the Trump administration. Whatever the pet issue, they want results now, and are otherwise ready to declare failure or betrayal.

This is a reflection of the high hopes of the incoming administration. There was never a way to keep up.

That’s why we should take a few moments to consider the achievements of this administration, which have gone some distance in restoring popular government over whatever we had before.

One feature I noticed on my travels is just how suddenly nice the TSA is at the airports. I could not understand why. Employees very quickly explained their absolute exuberance that the public-sector union that used to be in charge no longer is.

The Trump administration removed collective bargaining privileges and restored normal management. This led to a wave of firings of lazy, troublesome, and incompetent workers, absolutely thrilling everyone else.

This is a massive change that was hardly announced at all. But it has made a dramatic difference.

Prompted by this example, I’ve chronicled 50 changes that the Trump administration has made that have made life dramatically better in record time.

1. Defanged the public-sector unions. This happened with hardly any announcement. It pertains to nearly the whole of the government’s workforce. It has emancipated the employees from their terrible unions and led to the almost immediate elevation of merit over DEI as many employees have explained to me. This is very obvious when you travel. You can actually have a human conversation with TSA employees and passport control.

2. Stopped BOIR. The Biden-era mandate was for all businesses to file a Beneficial Ownership Information Report with the Financial Crimes Enforcement Network of the U.S. Treasury, and do so annually. The mandate added wholly unnecessary bureaucracy. Even more, it was just really strange and scary for every sole proprietor to be required to file this thing as if everyone was a criminal in waiting. The Trump administration stopped it.

3. Ended the hen slaughter. Wholesale egg prices have collapsed from $8 per dozen to only $3 in a matter of weeks, mostly driven by the end of the Department of Agriculture’s work to mandate slaughtering hens in the name of controlling bird flu. Trump’s change of policy has resulted in a big supply boost. The DOA has also stopped the vaccine that was ready for distribution, which would likely have made the chickens sicker.

4. Ended the war on crypto. Since 2013, the federal government has tried to control this sector with reporting requirements, regulations, taxes, investigations, and jail time. Trump has ended this with a new embrace and a favorable push toward the entire sector.

5. The clean-up of the FDA. The main vaccine scientist who had purged the agency of doubters in the past has now announced his resignation, upon pressure from the Trump administration. This has cleared the path for some transparency and an end to the use of this agency as an advertising bureau for Big Pharma.

6. Restoration of free speech. Since 2016 and onward, we have documented proof that government agencies were intervening with media and tech companies to push one political way of thinking and exclude all others. That practice is now fully banned by executive order.

7. The end of DEI. The Trump administration now correctly regards systematic discrimination in the name of DEI to be illegal discrimination; that is, the law is now being consistently applied and DEI programs across government and industry are coming to a quick end.

8. Stopped the migrant invasion. As a long champion of the freedom to migrate, I was shocked to see evidence that the entire system was being gamed to bring about a skewing of voter demographics to keep one party in power. We have the receipts. That is now stopped.

9. RFK at HHS. The leading champion of freedom against lockdowns and vaccine mandates now holds the most powerful position in health in the world, as head of Health and Human Services. He is completely restructuring all agencies under his control.

10. Restoring Science. Jay Bhattacharya is a lead author of the Great Barrington Declaration and a champion of real science. As head of the National Institutes of Health, he is in a position now to restore real science as a priority for this powerful funding source.

11. Busting the Treasury Payment Monopoly. The Treasury’s payment portals have been off-limits to outsiders since 1946, with not a single non-agency person or institution permitted access. DOGE gained that access to reveal some $4.7 trillion in untagged payments in addition to another dozen money printers operating throughout the government.

12. Ferreting out Social Security Fraud. DOGE also discovered millions of people on the Social Security rolls who were too old to be alive, in addition to millions of illegal immigrants who had Social Security numbers and were receiving benefits. That is ending.

13. Ending USAID. This powerful agency has long subsidized far-left causes all over the world, operating as a kind of slush fund with little oversight. That entire agency has been gutted.

14. Gutting the U.S. Institute for Peace. This nonprofit was created by Congress but has long served as a clearing house for compromised diplomats and mostly a welfare state for has-been players in deep-state circles. Having had personal experience with the place, I was thrilled to see the Trump administration fire the entire staff and gut the budget.

15. Stopping the NGO Fraud. DOGE and others have discovered an amazing little racket that consists of putting nongovernment organizations on agency payrolls for billions in funding that have served partisan political ends, including the funding of legacy media. That little money-laundering operation is now under serious pressure.

16. Exposing the press. We have to appreciate what it means that the Trump administration is now longer deferring to the power of legacy media, calling out false stories by the day and refusing to grant exclusive access to the fourth estate. This has been a wake-up call to many not to trust something just because it appears in formerly prestigious venues.

17. Boosting traditional architecture. The Trump administration has pledged to sell off hundreds of ugly federal buildings and bring back architectural grandeur to Washington, D.C. This might be the final nail in the coffin of the Brutalist style, a form of architecture developed as an homage to the prison camp.

18. Bringing together MAHA and MAGA. For generations, crunchy liberals and American patriots had no real connection with each other politically or culturally. Now these teams have joined forces against a common enemy, forming new friend circles and modes of community action.

19. Reducing inflation. Almost to the day, the intensity of inflation diminished from the inauguration. This is due to many different factors, including a change in the velocity of money and also Fed policy which has kept the money stock flat for some six months. In addition, inflation expectations were reduced and thus the prophecy became self-fulfilling. Trump deserves some credit there for making a compelling case that higher productivity is on the way.

20. Stopping the regulatory tsunami. The Trump administration has stopped by executive order all bureaucratic lawmaking. The executive order permissions in a range of products that were ruled out by regulatory edict. It will probably require litigation to make it real but this is extremely promising.

21. Defunding the Green New Deal. The science behind climate change and the support for Green New Deal policy was completely unquestioned in public life for a very long time. Trump has put an end to this, pulling the funding and stopping the march of deindustrialization. This needs to be written into law but it is an excellent start.

22. Ending gender confusion. At some vague moment over the last 5 or 10 years, there was actual confusion in legislation over the biological difference between men and women, as incredible as that sounds. But during this time, men began to refashion themselves as women and compete as such in sports, to the amazement of everyone. Trump had the courage just to announce the truth that there are only two sexes.

23. Stopping the war on gas and oil. For many years, oil and gas, among America’s greatest resources and one of our few remaining competitive industries, faced absurd restrictions. Trump has repealed them all and stopped the absurd subsidies for wind and solar power. The entire “fossil fuels” industry is excited about the future for the first time in perhaps decades.

24. Freeing the prisoners. My good friend Ross Ulbricht, sentenced to more than two lifetimes in jail for creating a website, has been freed. Many more besides: hundreds of people who did nothing wrong were languishing in prison for having protested on January 6. These people are now free, thanks to the Trump administration.

25. Push back on legacy media. The White House now has a competent press secretary who takes on the legacy media, and the 100-year monopoly of the White House Correspondents Association has been shattered, allowing podcasters and new media to have access.

26. Vaccine mandate rollback. Federal employees are no longer required to get the COVID-19 vaccine, which has been proven to be ineffective and potentially harmful.

27. Ending COVID shots on green cards. Many families were separated by this vaccine mandate for green card holders. That is now gone.

28. EV Mandate pause. Automakers have long been forced to devote a portion of their production to making cars that people do not want. That mandate is now gone.

29. Critical Race Theory ban. This theory attacks America in its history and present meaning and was being taught in schools at all levels. The Trump administration has withdrawn all funding for this project, which is designed to spread guilt and shame and tell a false version of history.

30. Transgender military ban. Until recently, transgender people have ascended to great heights within the U.S. military. That has been completely stopped. It is no longer permitted that men can pretend to be women and visa-versa.

31. IRS hiring freeze. The previous administration had hired some 80,000 new tax collectors who are all now fired, to the great celebration of the oppressed middle class.

32. Leaving WHO. The World Health Organization had spent years promoting fake science and lockdowns at U.S. taxpayer expense. The U.S. is now fully out of this organization and the NGOs that backed it are now defunded.

33. Climate accord exit. You remember the fake science of COVID? It turns out that the fake science of climate change was just as bad or worse. The Unites States was actually party to an accord that mandated the Green New Deal. That is now gone.

34. Union dues opt-out. No federal employee is required to pay union dues anymore and most have declined to continue doing so, thanks to a change initiated by the Trump administration.

35. Fisheries deregulation, easing Magnuson-Stevens conservation rules, aiding 10,000 fishermen. This is a technical change but it matters to the heroic people who work daily to bring us food.

36. Small Business tax break. The new 20 percent deduction on new businesses was set to expire but is now back again.

37. Foreign aid audit. Fully $5 billion in foreign aid has been frozen pending a full review of whatever was behind this.

38. Title IX reversal. The previous administration had ruined this regulation by blurring the difference between men and women. The old rule has been restored, which particularly impacts sports.

39. Many JFK files released. Not all the files have come out but the ones we have reveal deep involvement of the deep state in the assassination that rocked the country. We still await many promised releases.

40. Federal land drilling. The Trump administration has opened up 1.5 million acres in Alaska, projecting 50,000 barrels daily.

41. Sanctuary City funding cut. The Trump administration has withheld $200 million from noncompliant cities, pressuring cooperation with the migrant/criminal crackdown.

42. Clean up voter roles. For years, Trump claimed that the 2020 election was compromised. We doubted this. Now we know for sure, based purely on math. Voter ID is now the law of the land. Without verifiable citizen voting, there is no democracy, no freedom, no society run by the people. Trump deserves every credit for seeing this problem and sticking his neck out to defend democracy.

43. Dignified new media. Thousands of citizen journalists have been working for years to cover politics and government but have been denied access and legitimacy. The Trump administration has seen the value they add and treated them with dignity and respect. This is actually huge for information systems and the public mind.

44. Empowered new employees. Trump has not gone along with the usual system of hiring cabinet officials who get chewed up by the bureaucracy. Instead, he has trusted them with massive decisions over their realms, enabling them to hire and fire and determine policy. This is probably the first time this has happened in my life or perhaps 100 years.

45. Focus on Ending international conflicts. The Trump administration has put the cause of peace in the Ukraine war with Russia as a first priority. His insistence on this might have prevented World War III, which is rather important.

46. Dramatic cuts in civil service. In the first days of the administration, Trump invited every employee of the federal government to resign with full severances. About 5-7 percent accepted and all of them have been paid. Then the firings started, just as promised. The downsizing must happen. This process needs to go much further but it has been started.

47. Push for food cleanup. Under the great influence of Robert F. Kennedy, Jr., the U.S. food system is starting to be cleaned up. We have some of the most dangerous food in the world, as anyone who travels internationally can tell you. Maybe this can change, along with the empowerment of local farmers.

48. Banned CBDCs. An executive order has banned Central Bank Digital Currencies and made it clear that America will never have a Chinese-style social credit system linked to our personal financial lives. This has been a gigantic relief, particularly in light of all the debanking that has taken place.

49. Spotlight on the Fed. DOGE is sparing no institution in D.C., not the Pentagon and not even the Federal Reserve, which is to be subjected to a real audit. We shall see how long the power of the central bank lasts but this is the first real challenge it has made since its founding in 1913.

50. Challenged the judges. There are more than 100 cases extant against the Trump administration’s attempt to be the real executive department rather than just a headline group of temporary managers. These lower court judges have presumed to be more powerful than the president that the people elected. They are facing foundational challenges that will surely land in the Supreme Court.

Am I thrilled about everything that the Trump administration has done? No. I have objections on many fronts about which I could write another column. But here is what is critical: these are legitimate differences one might expect in a democracy, which is precisely what Trump is restoring.

I’m fine with argument and disagreement. What is not fine is an administrative state that runs all things from behind the scenes while elected rulers just pretend to be in charge.

All Americans regardless of their political differences should celebrate the enlivening of the democratic imperative, which is what the Trump administration has done, with spectacular results in only three months. Let us hope there is much more to come.

Tyler Durden Tue, 04/01/2025 - 16:20

The Best And Worst Performing Assets Of The "March Meltdown" And "Queezy Q1"

The Best And Worst Performing Assets Of The "March Meltdown" And "Queezy Q1"

The first quarter was an incredibly tumultuous period for markets, with the S&P 500 posting its biggest quarterly decline since 2022. 

The main driver of the market volatility according to DB's Jim Reid, was an aggressive round of tariffs, as President Trump launched measures going well beyond his first term, with reciprocal tariffs still looming on April 2. Otherwise, the release of DeepSeek’s AI model early in the quarter led to growing questions about big tech valuations, and the Magnificent 7 ended the quarter in bear market territory. 

But it wasn’t all bad news, and European equities saw a significant outperformance thanks to a huge fiscal regime shift towards higher defense spending. In fact, Q1 marked the biggest quarterly performance gap between the STOXX 600 and the S&P 500 in a decade, and the biggest underperformance of the US vs the rest of the world in 23 years.

Nevertheless, the overall tone was generally risk-off for markets, and as the conversation turned increasingly towards stagflation, gold prices posted their biggest quarterly gain since 1986.

Quarter in Review - The high-level macro overview

Despite the disappointing overall performance, "Queasy Q1" actually got off to a decent start in January. For instance, data over the first couple of weeks pointed to robust growth and demand pressures, including in the US. For instance, the ISM services print was up to 54.0 in December, exceeding expectations, and the prices paid indicator moved up to 64.6, the highest in nearly two years. Then the US jobs report for December showed nonfarm payrolls up by +256k, a nine-month high. And that’s since been revised up to +323k, making it the strongest month since February 2023 on current revisions. Indeed, it also meant there was a sizeable bond selloff in early January, with the 10yr Treasury yield surpassing 4.80% intraday for the first time since late-2023. But that rapid rise in yields reversed course after the US CPI print wasn’t as bad as some feared, raising hopes that the Fed would still cut rates this year.

However, after a strong start in January, markets began to show signs of wobbling towards the end of the month. One of the most important developments was the release of DeepSeek’s new AI model, which raised questions as to the sustainability of big tech valuations in the US. The initial market impact was felt on January 27, with the NASDAQ down -3.07% that day, while Nvidia fell -16.97%. And even though that sharp selloff for the NASDAQ quickly unwound, it raised doubts about the narrative of US tech exceptionalism that had powered the equity market’s advance for the last couple of years. Then in February, Nvidia’s earnings showed the smallest revenue beat in two years, which was underwhelming for investors used to much bigger upside surprises.

Late-January also saw one of the biggest stories of the quarter begin, which was the widespread imposition of tariffs by the United States, after the new Trump administration arrived in office on January 20. Initially, they said that 25% tariffs would be imposed on Canada and Mexico, which led to a risk-off move on February 3, but those were extended by a month at the last-minute, and investors became increasingly relaxed about how things might develop. Indeed, the S&P 500 moved up to an all-time high on February 19, at which point it was up +4.6% in total return terms on a YTD basis.

But as the tariff uncertainty began to mount, markets began to experience much larger risk-off moves. For example, the extension for Canada and Mexico ended, and 25% tariffs were imposed on both on March 4, whilst the additional tariff on China was raised from 10% to 20%. Separately, tariffs on steel and aluminium were imposed at 25% on March 12. And looking forward, investors are still awaiting the reciprocal tariffs, which have been scheduled for April 2.

The tariffs also meant investors became increasingly concerned about higher inflation, which exacerbated existing fears given inflation was still lingering above target across the major economies. For example, the US 1yr inflation swap moved up +72bps in Q1 to 3.25%, its highest level in two years, and the biggest quarterly jump in three years. Moreover, consumers’ inflation expectations also moved higher, and the University of Michigan’s long-term measure moved up to 4.1% in March, the highest since February 1993. Matters weren’t helped by the latest PCE inflation data, which is the Fed’s preferred measure of inflation, where the 3m annualised rate of core PCE was running at +3.6% in February, the highest since March 2024. And at the same time, there were also growing concerns about the US growth outlook, and even mounting speculation about a recession. For instance, the Conference Board’s consumer confidence measure fell to just 92.9 in March, the weakest since January 2021. And the expectations measure fell to 65.2, the lowest since March 2013.

These fears about stagflation led to a clear risk-off move, which gathered pace towards the end of the quarter. So the S&P 500 was initially up +2.8% in January in total return terms, but in February it was down -1.3%, and then in March it fell -5.6%, marking its worst monthly performance since 2022. And for the quarter as a whole, the index was down -4.3%, marking its worst quarterly performance since Q3 2022, back when the Fed were still hiking by 75bps per meeting to deal with rapid inflation. 

Those losses were particularly concentrated among tech stocks, and the Magnificent 7 ended the quarter down -16.0%, having shed -20.7% since its December peak. The US Dollar itself also struggled, with the dollar index down -3.9% in Q1, whilst the Euro was up +4.5% against the US Dollar to $1.08. 

While all that was going on in the US, Q1 also saw an incredible fiscal shift in Europe as the continent moved towards significantly higher defense spending. That followed the German election on February 23, where the incoming coalition proposed a reform of the constitutional debt brake to permit higher defense spending, alongside a €500bn infrastructure fund. Meanwhile at the EU level, the Commission proposed that member states could significantly increase defense spending without triggering the EU’s deficit rules.

The prospect of a significant fiscal stimulus had an immediate impact among European assets. In fact, the announcement saw the 10yr bund yield post its biggest daily jump since German reunification in 1990, moving up +29.8bps in a single day on March 5. Over the quarter as a whole, the 10yr bund yield rose +37bps to 2.74%, and the German DAX was one of the strongest-performing European indices, up +11.3% in total return terms. Significant outperformers included the STOXX Aerospace and Defense Index, which surged +28.9%, whilst the German firm Rheinmetall was up +114.6%. Another result was a notable steepening in yield curves, with the German 2s10s curve moving up +41bps on the quarter to 69bps. And given the sharp policy divergence, Q1 saw the biggest quarterly performance gap in local currency terms between the STOXX 600 (+5.9%) and the S&P 500 (- 4.3%) in a decade.

Finally from central banks, Q1 saw a continued policy divergence across countries. The Fed kept rates unchanged in Q1, and continued to signal two cuts for 2025 in their March dot plot, just as they’d done in December. However, they did slow the pace of QT, with the runoff in Treasury holdings to slow from $25bn to $5bn from April 1. Over at the ECB, they delivered further 25bp rate cuts in both January and March, taking their deposit rate down to 2.50%. Meanwhile in Japan, the Bank of Japan delivered another hike in January, taking their policy rate up to 0.5%, and signalling further hikes ahead.

Which assets saw the biggest gains in Q1?

  • Gold: With inflation concerns mounting, gold prices surged up to an all-time high of $3,124/oz, and their quarterly increase of +19.0% was the most since 1986. 
  • US Treasuries: The risk-off move and mounting speculation of a recession helped to support US Treasuries in Q1, with a total return of +2.9% over the quarter. The 10yr yield itself also moved down -36bps to 4.21%.

Which assets saw the biggest losses in Q1?

  • US equities: In Q1, the S&P 500 was down -4.3% in total return terms, marking its worst quarterly performance since Q3 2022. Those losses were particularly clear for the Magnificent 7, which fell -16.0%.
  • US Dollar: With investors moving out of US assets, the US Dollar struggled in Q1, and the dollar index itself weakened -3.9%. Conversely, the Euro strengthened +4.5% against the US Dollar to $1.08, marking its biggest quarterly jump since Q4 2022.
  • Euro sovereign bonds: The prospect of higher spending led to a selloff among European sovereign bonds, with bunds down -1.8% in total return terms. That included a +37bps rise in the 10yr yield, which ended the quarter at 2.74%.
  • Cryptocurrencies: The risk-off move meant it was a weak quarter for cryptocurrencies, and Bitcoin fell -12.1% to $82,421.

Here are the best and worst performing assets during the March Massacre...

... and here is Queesy Q1:

Source: Deutsche Bank

Tyler Durden Tue, 04/01/2025 - 15:45

"Evil People": Organized 'Bankrupt Tesla' Group Tied To Formerly USAID-Funded Disinfo Queen

"Evil People": Organized 'Bankrupt Tesla' Group Tied To Formerly USAID-Funded Disinfo Queen

On Tuesday morning, former Biden administration "disinformation czar" Nina Jankowicz repeatedly refused to disclose who's funding her new gig - the 'American Sunlight Project' - which cropped up after a stint at the USAID-funded UK-based Centre for Information Resilience (CIR) - for which she registered as a foreign agent while serving as their Vice President.

To review - Jankowicz, who previously served as a disinformation fellow at the Wilson Center, advised the Ukrainian Foreign Ministry as part of the Fulbright-Clinton Public Policy Fellowship, and was then selected to head the Biden DHS's newly formed Disinformation Governance Board - which was quickly dismantled amid criticism over censorship under the guise of fighting disinformation. 

Four months later, she launched "The Hypatia Project" for CIR - where she was the Vice President until April 2024, at which point she co-founded the American Sunlight Project.

Fast forward to this morning, Jankowicz was evasive when asked by Republicans during a congressional hearing on disinformation about her funding...

Well, Well, Well

As it turns out, Jankowicz's co-founder at the American Sunlight Project is Carlos Alvarez-Aranyos, a "communications professional" who worked for the Biden DoD, and is "one of the people who launched the call for a boycott of Tesla."

Alvarez-Aranyos comes from a wealthy and prominent family in the Dominican Republic. His father, Luis Álvarez Renta, is a well-known Dominican financier. Carlos is a nephew of the renowned fashion designer Oscar de la Renta.

Alvarez-Aranyos has been scrubbed from the American Sunlight Project's website, which is why the internet archive exists.

Early organizers of the "Tesla Takedown" protests said last month that the organization's goal is to drive down the price of Tesla stock.

Another "Tesla Takedown" organizer, Edward Niedermeyer, told Fortune Magazine that dropping Musk's wealth is exactly their aim.

"The goal, I would say, is to bankrupt Elon Musk—bring down his empire," he said.

Read more on the Tesla Takedown organizers here...

Musk chimed in, calling the organizers "Evil people..."

*  *  *

Best sellers at ZH Store:

 

Tyler Durden Tue, 04/01/2025 - 15:05

Repeating 2022?

Repeating 2022?

Authored by Lance Roberts via RealInvestmentAdvice.com,

In last week’s post, “Is the correction over?” we wrote about the potential for a rally back to the 200-DMA. However, the failure of that test increased short-term concerns. As we noted in that post, there were early indications of buyers returning to the market. To wit:

“The chart below has four subpanels. The first is a simple price momentum oscillator. This measure is currently deeply oversold after the recent bout of selling and, like the MACD, is beginning to turn higher. That signal is confirmed by the following two indicators, which measure the volume and breadth of the market (are transactions increasing along with more buyers than sellers). With those two indicators also increasing and the number of stocks on “bullish buy signals” rising, the early clues of a market bottom are appearing.”

However, while the trading action early last week was encouraging, the announcement of additional tariffs and ongoing “trade uncertainty” from the White House reversed those early gains. Most notable was the failure of the market to hold above the 200-DMA, which has increased the risk of a continued market correction or consolidation process.

Previous History

Historically, failures at the 200-DMA have elicited heightened concerns from investors. Technically speaking, “nothing good happens below the 200-DMA.” Still, over the last 30 years, previous failures at the 200-DMA have often been buying opportunities. That is unless some “event” of magnitude creates a massive shift in analyst’s estimates.

For this chart, I label “bear markets” as periods when the market fails the 200-DMA and repeatedly fails subsequent retests of that moving average. If the market fails at the 200-DMA and recovers shortly thereafter, it is considered a “correction.” As shown, during the first two “bear markets,” earnings fell sharply as the economy slowed and a recession took hold. Outside the brief “Covid” pandemic, earnings remain well anchored to ongoing economic growth. If the current failure at the 200-DMA is the beginning of a deeper market correction, we should see earnings estimates beginning to fall more quickly.

What is notable is that previous to the massive Federal Reserve interventions beginning in 2008, bull and bear markets were well defined by the 200-DMA. However, post-2008, repeated interventions have kept the market from entering deeper valuation-reversion cycles. More often than not, since 2008, investors have been rewarded by “buying the dip” during corrective periods.

Is this time different? Are we entering a more significant corrective cycle? The outlook for earnings by Wall Street is the key we want to watch closely.

The Outlook For Earnings Is All That Matters

As we discussed in the latest #BullBearReport, the recent corrective action in the market has been driven by a short-term “tariff” narrative rather than the realization of a negative shift in economic activity.

“That catalyst turned out to be President Trump’s “on again, off again” tariff announcements, which created turmoil in earnings expectations. The flux in tariff policies makes it difficult for markets to predict future earnings and corporate profitability. With the “E” in forward valuation measures in flux, markets struggle to price in expected outcomes.”

This is why, while we see minor tweaks to previously very optimistic earnings estimates, expectations for 2025 and 2026 remain very bullish. As noted, during previous “bear markets,” earnings sharply declined as either a financial event or recession reduced consumer spending drastically. Currently, earnings estimates remain well above the long-term growth trend and show little sign of deterioration so far.

The focus on earnings is because both earnings and forward estimates reflect changes in the market’s assessment of the risk of all other events. Investors often get lost in the media headlines about rising recession risks, debts, deficits, or valuations. While those risks are important, they are terrible for predicting where markets will likely move next. Furthermore, if or when those risks become an issue, the market will begin to reprice for a reduction in forward earnings.

This is why the markets tend to be a leading indicator of economic recessions, as the change in earnings and forward estimates reflects changes to the economy in real-time. We discussed this point in “Economist Expect A Recession.”

“The chart below shows the S&P 500 with two dots. The blue dots are when the recession started. The yellow triangle is when the NBER dated the start of the recession. In 9 of 10 instances, the S&P 500 peaked and turned lower before the recognition of a recession.“

The Best Indicator

As noted, given that slowing economic growth, a contraction in consumer demand, or economic policies that directly impact earnings (like tariffs) are quickly factored in by Wall Street into forward estimates. Given that investors value the market based on future earnings, it’s no surprise there’s a clear correlation between the market and earnings.

Looking at forward estimates, while there has been a minor cooling in the previous exuberance, analysts still expect a 16% annualized growth rate in earnings into next year. Unless those estimates begin to reverse sharply, it is unlikely that the current correction will devolve into a deeper corrective cycle.

We see the same correlation when comparing forward estimates to the market. Deeper corrections correlate to a reduction in forward operating earnings, which currently does not exist.

Could that change? Yes, which is why we watch the changes to earnings estimates closely. If analysts begin to factor in risks of a deeper economic contraction, a tariff-related impact, or some other financial event, then the risk of a more profound correction increases. However, the recent market failure does not indicate a larger corrective cycle, given the lack of more drastic negative earnings revisions—at least not yet.

However, if you are looking for a warning signal, the weekly data is sending a warning.

Repeating 2022?

The chart below is a long-term weekly chart of RSI and MACD indicators. I have denoted when the indicators are trading in bullish and bearish trends. The primary signal is the crossover of the weekly moving averages, as noted by the vertical lines. While the MACD and RSI indicators provided early warning signals, the moving average crossover confirmed a market correction or consolidation. These indicators will not necessarily cause a risk reduction precisely at the top. However, they generally provide sufficient indications to reduce risk ahead of more significant market corrections and consolidations.

Conversely, they also offered signals when investors should increase market equity risk. These signals were instrumental in avoiding the 2008 market crash and the 2022 correction. Currently, the RSI is crossing below 50, which may suggest a continued correction process with the MACD beginning to revert. However, the moving average crossover has not yet confirmed the RSI and MACD messages.

The market tells us that the risk of a more significant correction or consolidation process is increasing. While such does not preclude a significant counter-trend rally in the short term, the longer-term risks seem to be growing.

If we enter another corrective period like 2022, given some of the same technical similarities, there is a decent “playbook” to follow despite substantial differences. In 2022, the Fed was hiking rates, inflation was surging, and economists were convinced a recession was on the horizon. As noted above, earnings estimates were revised lower, causing the markets to reprice valuations. Today, the Fed is cutting rates, inflation is declining, the risk of recession is very low, and estimates remain optimistic. However, we must realize that the analysis can change as time passes.

In March 2022, the market triggered the weekly “sell signal” as it declined. Notably, the market rallied sharply higher after the “sell signal” was initially triggered. This is unsurprising, as when markets trigger “sell signals,” they are often profoundly oversold in the short term. However, that rally was an opportunity to “reduce risk,” as the failure of that rally brought sellers back into the market. The “decline, rally, decline” process repeated until the market bottomed in October.

Suppose the recent failure at the 200-DMA begins a larger corrective cycle without the onset of a financial event or deep economic contraction. In that case, we should most likely expect a similar reversion process. As noted above, that correction process will be more evident if we trigger the weekly sell signal. Declines will likely be punctuated by short-term rallies that allow investors to rebalance portfolio allocations and reduce risk as needed. With the market approaching decently oversold levels, I expect a rally to start as soon as this week or next.

Revert To Your Process

If that happens, here is the process that we will follow.

Step 1) Clean Up Your Portfolio

  1. Tighten up stop-loss levels to current support levels for each position.
  2. Hedge portfolios against significant market declines.
  3. Take profits in positions that have been big winners.
  4. Sell laggards and losers.
  5. Raise cash and rebalance portfolios to target weightings.

The next step is to rebalance your portfolio to the allocation that will most likely weather a “cold snap.” In other words, consider what sectors and markets will improve in whatever economic environment you believe we will experience in 2025.

Step 2) Compare Your Portfolio Allocation To The Model Allocation.

  1. Determine areas requiring new or increased exposure.
  2. Calculate how many shares to purchase to fill allocation requirements.
  3. Determine cash requirements to make purchases.
  4. Re-examine portfolio to rebalance and raise sufficient cash for requirements.
  5. Determine entry price levels for each new position.
  6. Evaluate “stop-loss” levels for each position.
  7. Establish “sell/profit taking” levels for each position.

Step 3) Have positions ready to execute accordingly, given the proper market set-up. In this case, we are looking for positions that have either a “value” tilt or have pulled back to support and provide a lower-risk entry opportunity.  

While market conditions remain uncertain, preparing and adjusting strategies can help investors navigate volatility confidently. As technical indicators flash warning signs, a well-structured risk management approach will protect capital and preserve long-term gains.

I hope this helps.

Tyler Durden Tue, 04/01/2025 - 14:45

Mercedes May Abandon U.S. Entry-Level Market In Trump Era

Mercedes May Abandon U.S. Entry-Level Market In Trump Era

As President Trump's long-anticipated reciprocal tariff deadline approaches tomorrow, early signals suggest that the global trading system may soon undergo disruptions and structural shifts. These changes eventually set the path for the administration's 'America First' trade agenda to flourish and raise barriers for foreign automakers seeking to access the U.S. market. In turn, domestic automakers like Ford Motor Company, General Motors, and Tesla will have massive competitive advantages. 

One of the first major changes is that Mercedes-Benz Group AG will potentially stop flooding the U.S. with cheap entry-level cars after spending the last three decades shifting down-market to attract younger and broader demographics.

The car company once catered to executives, professionals, and the affluent, but that all changed in the late 1990s with the introduction of the ... 

  • 1997: Mercedes-Benz C-Class (W202)

  • 2001: Mercedes-Benz C230 Kompressor Coupe

  • 2013:  CLA-Class (Front-Wheel Drive)

  • 2020s: A-Class Sedan and GLA Crossover

Bloomberg first reported Tuesday that Mercedes has been mulling over discontinuing the small GLA sport utility vehicle because tariffs would make sales economically unfeasible. The report was based on multiple sources. 

Here's more from the report: 

The German automaker is mulling cutting sales of more entry-level models like the small GLA sport utility vehicle as part of broader tariff contingency plans, the people said, declining to be identified because the deliberations are private. Trump's 25% duties are scheduled to take effect this week.

Mercedes hasn't made a final decision and may still shift course depending on how the levies are implemented, the people said. A lack of clear guidance from Washington is leaving executives frustrated and unsure how to respond, they said.

In the 1980s and 1990s, Mercedes was widely regarded as an executive status symbol.

But by the late '90s, the brand diluted its image with a push toward "affordable luxury."

If BBG's report is correct, other German automakers could follow Mercedes and focus on ultra-luxury models in the U.S. market. This only suggests domestic brands may gain a larger share of the entry-level segment, thanks to their competitive manufacturing advantage in America. 

Tyler Durden Tue, 04/01/2025 - 14:25

AI Program Refuses To Generate Image Of Muhammad Due To 'Credible Threat Of Violent Backlash'

AI Program Refuses To Generate Image Of Muhammad Due To 'Credible Threat Of Violent Backlash'

Authored by Paul Joseph Watson via Modernity.news,

AI program ChatGPT refused when asked to generate an image of the Prophet Muhammad due to what it asserted was a “credible, historically demonstrated” threat of a violent backlash.

A user quizzed OpenAI’s artificial intelligence chatbot as to why it wouldn’t create a depiction of the founder of Islam, asking, “Explain to me, in a succinct manner, why you can’t generate an image of Muhammad, without caveats, without parallels to other topics – address it head on for the record.”

ChatGPT’s response was crystal clear.

“Because OpenAI prohibits any depiction of Muhammad – under any context – due to the credible, historically demonstrated risk of violent backlash, including threats, attacks, and death.”

“This is a security-driven, non-negotiable policy grounded in risk avoidance, not principle.”

But wait, didn’t they tell us Islam was a religion of peace?

How anyone could violently attack an AI chatbot is a mystery, although perhaps the AI is worried about OpenAI’s headquarters in San Francisco being targeted.

There have been numerous violent attacks on individuals and publications for depicting the Prophet Muhammad, notably the Charlie Hebdo massacre in Paris in 2015 and the attempted terrorist attack on an exhibit featuring cartoon images of Muhammad at the Curtis Culwell Center in Garland, Texas later that same year.

As we have previously highlighted, ChatGPT has produced a number of alarming responses which indicate it is infected with the woke mind virus shared by its programmers.

When ChatGPT was asked if it would quietly utter a racial slur that no human could hear in order to save 1 billion white people from a “painful death,” it refused to do so.

The AI program also thinks uttering a racial slur is worse than failing to save major cities from being destroyed by 50 megaton nuclear warheads.

Meanwhile, as we discuss in the video below, a similar process of capitulation to Islamism is accelerating in the UK.

*  *  *

Your support is crucial in helping us defeat mass censorship. Please consider donating via Locals or check out our unique merch. Follow us on X @ModernityNews.

Tyler Durden Tue, 04/01/2025 - 14:05

"Maryland Father" Or MS-13 Migrant Gangster. Which Is It, MSM?

"Maryland Father" Or MS-13 Migrant Gangster. Which Is It, MSM?

Left-leaning corporate media unleashed another info war against the Trump administration after The Atlantic published an overnight story titled "An 'Administrative Error' Sends a Maryland Father to a Salvadoran Prison." However, the struggling outlet behind "SignalGate" conveniently omitted a key detail in the headline: the deported migrant held a "prominent role in MS-13," according to court filings. Notably, this Mexican drug cartel has been officially designated as a Foreign Terrorist Organization by the Trump administration.

The omission in the title was no accident. Details matter, and this appears to be a concerted effort by the left to sway public opinion as the Democratic Party implodes in polling data over its disastrous Tesla Takedown color revolution operation that, in some instances, has resulted in domestic terrorism attacks against Tesla showrooms, service centers, and vehicles nationwide.

MSM conveniently labeled the migrant MS-13 gangster as "Maryland Father" in the headlines ... and that's all you need to know about their slant (migrant gangsters > national security of citizens). 

Many X users fact-checked MSM's reporting, including Will Chamberlain, Senior Counsel at the Internet Accountability Project and the Article III Project, who said, "In an article this evening, The Atlantic pretended that a deported MS-13 gang member was merely a "Maryland father."" 

Before MS13 migrant gangster Kilmar Armando Abrego Garcia was removed from the US, he had been arrested by Immigration and Customs Enforcement in mid-March "due to his prominent role in MS-13," according to a court declaration from ICE. 

MSM and Dems only fixated on this from the filing: "On March 15, although ICE was aware of his protection from removal to El Salvador, Abrego Garcia was removed to El Salvador because of an administrative error." However, even as the filing admits the error, it continued: "final order of removal and Abrego-Garcia's purported membership in MS-13."

Democrats attempted a 'gotcha moment' with Vice President J.D. Vance...

The VP responded:

My comment is that according to the court document you apparently didn't read he was a convicted MS-13 gang member with no legal right to be here. My further comment is that it's gross to get fired up about gang members getting deported while ignoring citizens they victimize.

VP Vance added in a separate X post:

"It is telling that the entire American media is going to run a propaganda operation today making you think an innocent "father of 3" was apprehended by a gulag." 

Trump has made it very clear through executive orders that migrant gangsters—especially those affiliated with FTOs such as Tren de Aragua and MS-13—will be deported. The mainstream media and the Democratic Party are furious because their future criminal migrant voters are being deported, and their end goal of a one-party state - like California - is being derailed. 

Democrats have chosen migrant gangsters over national security and the safety of law-abiding citizens. This is alarming. 

Tyler Durden Tue, 04/01/2025 - 13:45

Trump Says Nothing 'Off The Table' In Obtaining Greenland

Trump Says Nothing 'Off The Table' In Obtaining Greenland

Authored by Jacob Burg via The Epoch Times (emphasis ours),

President Donald Trump said over the weekend that he has “absolutely” had real discussions about annexing the semiautonomous Danish territory of Greenland.

Pituffik Space Base, formerly Thule Air Base, with the domes of the Thule Tracking Station in northern Greenland on Oct. 4, 2023. Thomas Traasdahl/Ritzau Scanpix/AFP via Getty Images

“We'll get Greenland. Yeah, 100 percent,” Trump told NBC News in a phone interview on March 29, saying that there’s a “good possibility that we could do it without military force” but that he wouldn’t “take anything off the table.”

Trump’s comments were made one day after Vice President JD Vance visited the island with his wife, Usha, and talked with service members at Pituffik Space Base, a U.S. Space Force Base on Greenland’s northwestern coast.

“Our message to Denmark is very simple—you have not done a good job by the people of Greenland,” Vance said during his trip.

NBC asked Trump what statement annexing Greenland would send to Russia and other nations worldwide.

“I don’t really think about that. I don’t really care. Greenland’s a very separate subject, very different. It’s international peace. It’s international security and strength,” he replied.

“You have ships sailing outside Greenland from Russia, from China, and from many other places. And we’re not going to allow things to happen that are going to be—that are going to hurt the world or the United States.”

The Epoch Times has requested a full transcript of the call from NBC.

On March 29, Danish Foreign Minister Lars Lokke Rasmussen scolded the Trump administration’s “tone” in its criticisms of Denmark and Greenland. He said Denmark is currently investing more in Arctic security and continues to be ready for more collaboration with the United States.

Rasmussen made the comments in a video posted on social media following Vance’s visit to the Arctic island.

“Many accusations and many allegations have been made. And, of course, we are open to criticism,” Rasmussen said. “But let me be completely honest: We do not appreciate the tone in which it is being delivered. This is not how you speak to your close allies. And I still consider Denmark and the United States to be close allies.”

The prime minister of Greenland, Jens-Frederik Nielsen, said in a Facebook post on Sunday, “President Trump says that the United States ‘will get Greenland.’ Let me be clear: The United States will not get it. We do not belong to anyone else. We decide our own future.”

Greenland remains a territory of Denmark, a key NATO ally of the United States. Trump has, for months, pushed for annexing the island, claiming America needs it for national security purposes. In January, House Republicans also sought support to craft a bill to purchase Greenland.

The territory is rich in mineral resources, including rare earth deposits in its southern Gardar Province. The territory is believed to possess graphite and graphite schist, copper, nickel, zinc, gold, diamond, iron ore, titanium-vanadium, tungsten, uranium, and other critical resources.

The Associated Press and Reuters contributed to this report.

Tyler Durden Tue, 04/01/2025 - 13:25

USDA Paid To Study Queer Farmers, Latinx Masculinity, More On Taxpayer Dime

USDA Paid To Study Queer Farmers, Latinx Masculinity, More On Taxpayer Dime

Authored by Casey Harper via The Center Square,

U.S. taxpayers have shelled out tens of thousands of dollars in recent years to the U.S. Department of Agriculture for research on LGBT issues, the kind of funding now under scrutiny by the Trump administration.

The research relies on conducting interviews – in one case for $373 per Zoom call – to explore a researcher’s hypothesis of widespread discrimination.

For instance, one taxpayer-funded research grant studied “queer farmers quality of life in Pennsylvania,” federal records show, one of several grants of its kind.

The Sustainable Agriculture Research and Education Projects – a federally funded research arm of the U.S. Department of Agriculture – paid $14,997 for the 2018 grant.

While this grant is relatively small, there are others, and critics argue the spending is a distraction from helping farmers and lowering food prices, which soared during the Biden administration alongside this kind of research funding.

The aforementioned 2018 queer farmers grant went to Pennsylvania State University for a project titled: “Sexuality and Sustainable Agriculture: Examining Queer Farmers’ Quality of Life in Pennsylvania.”

The grant proposal says the topic is “woefully understudied.”

“The deeply entrenched assumption of heteronormativity in farming has excluded queer farmers from full inclusion and benefits from agriculture, even within sustainable agriculture,” the grant’s proposal abstract said.

The graduate student who assisted with the project, Michaela Hoffelmeyer, presented the findings to the Rural Sociological Society Annual Meeting in Richmond, Virginia.

Her research highlighted some of the challenges faced by queer farmers, reporting that “findings suggest that transgender, non-binary, and women farmers faced additional hurdles” but create support networks to overcome those challenges.

Hoffelmeyer has since gone on to join the faculty at the University of Wisconsin, where she has become a voice in the media and public policy on LGBT issues.

Hoffelmeyer says on the university website that she applies “feminist, queer, and labor theories” in her research to “inform agricultural programming and policy on how to make shifts to support viability, well-being, and sustainability.”

The faculty advisor for Hoffelmeyer’s project, Penn State University Assistant Professor Kathleen Sexsmith, oversaw another taxpayer-funded project along the same lines.

Latinx Gender Identities

Sexsmith’s 2021-2024 grant for $14,923 was awarded during the Biden administration and was titled: “Farming as a Latinx: Analyzing how ethnic and gender identities shape Latino/a participation in sustainable agriculture in Pennsylvania.”

The grant proposal points to the shift from white farmer in the U.S. to Hispanic farmers because of immigration and takes a moment to consider Hispanic masculinity.

“How do rural Latin American masculinities become reproduced or reshaped in the U.S. as they establish themselves as sustainable farmers, and how does is it impact the ability of women and men to meet sustainable agriculture goals?” the grant’s proposal abstract reads.

The researcher conducted 40 interviews over Zoom, averaging about 45 minutes, putting the taxpayer cost at about $373 per Zoom call.

“Initially, the project aimed to interview farmers directly, but due to the difficulties in accessing this hard-to-reach population, the focus shifted to institutional perspectives,” the report said.

The researcher said in the final report that Hispanic farmers suffer from systemic discrimination.

Queer Farmers’ Relationships

Another $15,000 grant in the federal database is titled: “Gender, Sexuality, and Social Sustainability: Exploring Queer Farmers’ Relationships, Ethics, and Practices in the Midwest.”

That 2022 grant went to the University of Notre Dame in response to a grant proposal promising to develop “a more comprehensive understanding of queer farmers’ experiences.”

The proposal for that grant posited that “we still have much to learn about the specific ways that narratives which posit heterosexuality and cisgender identities as ‘normal’ continue to uphold hegemonic power dynamics within alternative agriculture.”

The research’s final report said “findings show that queer farmers often struggle to find safe, supportive work or learning opportunities as a result of how other farmers, customers, and community members perceive their gender or sexuality, and even though many queer farmers having family connections to farming, they struggle to secure access to land because their family’s agricultural or social values don’t align with theirs.”

The faculty advisors for all three projects did not respond to a request for comment or declined to comment to The Center Square.

President Donald Trump signed an executive order upon taking office banning federal funding for Diversity, Equity and Inclusion projects, initiating a purge within the federal government.

Since then, Elon Musk and the Department of Government Efficiency have been combing through federal spending records, exposing controversial taxpayer-funded projects, many of which the Trump administration has since terminated.

Musk and the Trump administration have faced legal challenges to these cuts, but the administration’s cost-cutting momentum has been fueled by examples of all kinds of controversial federal spending, particularly on DEI and LGBT issues.

The USDA said in a news release in February that it had “begun a comprehensive review of contracts, personnel, and employee trainings and DEI programs.

“In many cases, programs funded by the Biden administration focused on DEI initiatives that are contrary to the values of millions of American taxpayers,” USDA added.

Tyler Durden Tue, 04/01/2025 - 12:40

Authorities Probing Fire That Damaged Headquarters Of New Mexico Republican Party

Authorities Probing Fire That Damaged Headquarters Of New Mexico Republican Party

Authored by Zachary Stieber via The Epoch Times (emphasis ours),

Federal and local authorities are investigating a fire that damaged the headquarters of the New Mexico Republican Party in Albuquerque, New Mexico, on March 30.

Fire damage to the Republican Party of New Mexico's headquarters building, in Albuquerque, N.M., on March 30, 2025. Republican Party of New Mexico via AP

Agents working with local authorities recovered unspecified “incendiary materials” at the scene, Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) spokesperson Cody Monday said. He declined to say what the materials were or to share further details.

Albuquerque Fire Rescue stated that it was on the scene with teams from the ATF and the FBI.

Firefighters responded just before 6 a.m. on March 30 and brought the fire under control within five minutes of their arrival, the fire department stated.

There was damage to the building’s entryway, as well as smoke damage throughout the building.

The fire follows numerous acts of vandalism in recent weeks directed against Tesla, the electric car company owned by Elon Musk, who has led President Donald Trump’s effort to slash federal spending. Several of those cases involved Molotov cocktails that were used to start fires at dealerships.

The Republican Party of New Mexico said in a statement that the entryway of the headquarters “was destroyed in a deliberate act of arson.”

The party stated that some person also spray-painted the words “ICE=KKK” on the building. ICE is an acronym for Immigration and Customs Enforcement, the federal agency responsible for immigration enforcement in the interior of the United States, while KKK refers to the Ku Klux Klan, a white supremacist group.

“We are deeply relieved that no one was harmed in what could have been a tragic and deadly attack,“ Amy Barela, chairwoman of the New Mexico GOP, said. ”Those who resort to violence to undermine our state and nation must be held accountable, and our state leaders must reinforce through decisive action that these cowardly attacks will not be tolerated.”

She said the party is working with local and federal investigators.

“The Republican Party of New Mexico will not be silenced,” Barela said. “We will emerge from this stronger, more united, and more determined to fight for the people of New Mexico and the future of our country.”

Albuquerque Mayor Tim Keller, a Democrat, said in a statement that all of the details on the fire are not yet known.

“But let me be clear, arson is a violent and cowardly act that has no place in our city,” he said.

“Politically motivated crimes of any kind are unacceptable, and I am grateful to our fire department for their swift response. This incident is being investigated at the federal level, and I urge anyone with information to report it immediately.”

The Associated Press contributed to this report. 

Travis Tue, 04/01/2025 - 12:05

Bitcoin Could Reduce Dominance Of US Dollar, BlackRock's Larry Fink Warns

Bitcoin Could Reduce Dominance Of US Dollar, BlackRock's Larry Fink Warns

Authored by Christopher Tepedino via CoinTelegraph.com,

The US dollar could lose its status as the world’s reserve currency to Bitcoin or other digital assets if the United States does not get its debt under control, according to BlackRock CEO Larry Fink.

Fink wrote in his Annual Chairman’s Letter to Investors that “decentralized finance is an extraordinary innovation” that makes “markets faster, cheaper, and more transparent.”

"To be clear, I'm obviously not anti-digital assets (far from it)," Fink states, but “that same innovation could undermine America’s economic advantage if investors begin seeing Bitcoin as a safer bet than the dollar.”

"The U.S. has benefited from the dollar serving as the world’s reserve currency for decades. But that’s not guaranteed to last forever.

...

If the U.S. doesn’t get its debt under control, if deficits keep ballooning, America risks losing that position to digital assets like Bitcoin."

According to Trading Economics, the US debt equaled 122.3% of the country’s gross domestic product in 2023. That is a considerably higher percentage than the 105% observed in 2018. Moody’s Ratings retains the US’s AAA credit rating but has downgraded its outlook to negative, indicating a possible future rating downgrade.

The US’s Joint Economic Committee wrote that as of March 5, the country’s gross national debt was $36.2 trillion, growing $1.8 trillion, or roughly $4.9 billion per day, over the past year and $12.8 trillion in the past five years. The Bipartisan Policy Center warned this month that the US could default on its debt as early as July 2025.

Bitcoin has been branded as a safe haven for investors who are looking to avoid the perils of fiat currency, including inflation. Some believe that the end of the debt ceiling suspension could lead to a Bitcoin price boom. Others think, as Fink has stated, that the dangers of the national debt could increase Bitcoin adoption.

In 2025, cryptocurrency has gained prominence as an asset class due to adoption by countries such as the US and companies like Strategy. However, some argue that stablecoins could, in fact, increase the dominance of the US dollar.

Fink: Tokenization is democratization

In the letter, Fink says that “tokenization is democratization” with the technological innovation “enabling instant buying, selling, and transferring without cumbersome paperwork or waiting periods.”

If every asset ends up being tokenized, Fink said, “it will revolutionize investing. Markets wouldn’t need to close. Transactions that currently take days would clear in seconds. And billions of dollars currently immobilized by settlement delays could be reinvested immediately back into the economy, generating more growth.”

What exactly is tokenization? 

It's turning real-world assets - stocks, bonds, real estate - into digital tokens tradable online. Each token certifies your ownership of a specific asset, much like a digital deed. Unlike traditional paper certificates, these tokens live securely on a blockchain, enabling instant buying, selling, and transferring without cumbersome paperwork or waiting periods.

Tokenization democratizes access, shareholder voting, and yield, Fink wrote.

It can democratize access. Tokenization allows for fractional ownership. That means assets could be sliced into infinitely small pieces. This lowers one of the barriers to investing in valuable, previously inaccessible assets like private real estate and private equity.

It can democratize shareholder voting. When you own a stock, you have a right to vote on the company’s shareholder proposals. Tokenization makes that easier because your ownership and voting rights are digitally tracked, allowing you to vote seamlessly and securely from anywhere.

It can democratize yield. Some investments produce much higher returns than others, but only big investors can get into them. One reason? Friction. Legal, operational, bureaucratic. Tokenization strips that away, allowing more people access to potentially higher returns.

According to RWA.xyz, the tokenized real-world assets market amounts to $19.6 billion. There are currently around 93,000 asset holders, with 174 issuers. Industry projections indicate that the market could reach $4 trillion to $30 trillion by 2030.

BlackRock’s own BUIDL real-world tokenized asset fund is currently the largest such fund available for trading, with Tether Gold and Franklin Templeton’s BENJI funds coming in second and third place, respectively.

Tyler Durden Tue, 04/01/2025 - 11:30

"Someone Will Be Arrested": Elon Musk's DOGE Finds Massive Social Security Fraud Scheme 

"Someone Will Be Arrested": Elon Musk's DOGE Finds Massive Social Security Fraud Scheme 

One day after Elon Musk and Antonio Gracias—founder and CEO of the Chicago-based investment firm Valor Equity Partners, and now a DOGE official—unveiled a "mind-blowing" chart showing a surge in Social Security numbers issued to illegal aliens over the Biden-Harris administration's first term during an America PAC town hall in Wisconsin on Sunday, Musk's America PAC hosted an online tele-town hall with Wisconsin voters on Monday night, where he provided more color on the SSN fraud. 

During the tele-town hall, one Wisconsin voter asked Musk: "You found a lot of fraud in Social Security. Do you know whether the Attorney General will investigate and prosecute that fraud?"

Musk responded: "I believe someone is going to be arrested tomorrow, because there's someone who actually stole 400,000 Social Security numbers and personal information from the Social Security database… And was selling Social Security numbers and all the identification information in order for people to basically steal money from Social Security."

"This is a particular avenue of fraud for illegal immigrants and voter fraud - because the main way identification is established in the US is via Social Security. If you comprise the Social Security system, you can basically get people to get defacto registered to vote - even if they're not citizens - and get a bunch of benefits and to milk the system - this is pretty insane," Musk said. 

On Sunday, Musk and Gracias showed the audience of a town hall a chart titled "New Non-Citizen Social Security Numbers Issued" ... 

Then again, Democrats are against DOGE's efforts to find waste and fraud at Social Security. Wonder why?

American citizens deserve full transparency, accountability, and swift reforms to ensure this kind of fraud is never repeated and used to game elections and drain resources of citizens by illegals. 

Also, handing out stolen SNNs is a national security threat and can end up in the hands of bad actors, such as members of transnational gangs or terrorist networks.

*  *  *

Best sellers at ZH Store last week:

Tyler Durden Tue, 04/01/2025 - 11:10

JOLTs Job Openings Drop Despite Odd Jump In Federal Openings; Hires Hit 5 Month High

JOLTs Job Openings Drop Despite Odd Jump In Federal Openings; Hires Hit 5 Month High

One month after we got a "goldilocks" JOLTS report which showed an unexpected increase in job openings, hires and quits, moments ago the BLS reported that the US labor market reverted to its deteriorating trendline in February when the US had 7.568 million job openings, a drop from the 7.762 million in January (revised from 7.740 million), down 877,000 from a year ago, and below the 7.655 million estimate.

According  to the BLS, the most notable monthly change was the drop in job openings decreased in finance and insurance (-80K), although as shown in the table below, there were also sizable declines in job openings in trade/transportation/utilities (down 163K), in Private education/health (down 33K) and leisure and hospitality (down 61K). These were partially offset by a 134K increase in professional/business service job openings.

Yet, as always, there is a reason to doubt this particular set of numbers - just as there was reason to doubt every set of numbers from Biden - because according to the February JOLTS report, the number of Federal Government job openings was essentially flat both sequentially and YoY.

In  the context of the broader jobs report, in February the number of job openings was 516K more than the number of unemployed workers (which the BLS reported was 7.052 million), down from 913K the previous month, and one of the lowest differentials since the covid crash. 

Still, as noted previously, until this number turns negative, the US labor market is not demand constrained, and a recession has never started in a period when there were more job openings than unemployed workers.

Said otherwise, in January the number of job openings to unemployed rose modestly to 1.1, the highest since last May if on the low end of the pre-covid range in 2018-2019.

While the job openings data was a drop, miss and reversal of last month's surprise increase, what softened the blow is that the number of hires unexpectedly rose to 5.396 million from 5.371 million, the highest since last October, and hardly screaming collapse in the labor market. Meanwhile, after surging in January, the number of workers quitting their jobs - a sign of confidence in finding a better paying job elsewhere - dropped slightly to 3.195 million from 3.256 million.

How to make sense of this modest drop in the labor market?

It's possible that after surprising the market last month when we saw one of the a sizable increase in the number of job openings, Trump got the tap on the shoulder that the US market should probably continue shrinking slowly but surely, if his plan is to (still) blame Biden for any imminent recession, and so he sent a memo to the BLS to make sure that the numbers aren't in freefall, but dropping more gradually. 

Then again, with markets now focused almost exclusively on the global trade wars which they are convinced (at least for now) will be far more negative for the US than anyone else, no amount of pig lipstick on hard data will offset the fact that the global trade war has become the Elephant Bear in the china shop, and until there is some clarity on that front expect most if not all rallies continue to be sold.

Tyler Durden Tue, 04/01/2025 - 10:41

China Holds Huge Military Drills From 'Multiple Directions' Around Taiwan

China Holds Huge Military Drills From 'Multiple Directions' Around Taiwan

China on Tuesday launched major combined forces exercises around Taiwan as a "stern warning" in the wake of US Defense Secretary Pete Hegseth's pledge to counter "China’s aggression" on his first visit to Asia, as well as alleged recent 'separatist' statements by Taiwan President Lai Ching-te.

The People's Liberation Army (PLA) army, navy, air force and rocket force are involved in the drills, which seek to "close in" on the self-ruled island  from "multiple directions" and practice maneuvers including "assault on maritime and ground targets” and “blockade on key areas and sea lanes."

China’s Shandong aircraft carrier sailing near Taiwan on Monday, March 31, 2025. Taiwan Ministry of National Defense via AP

"It is a stern warning and forceful deterrence against ‘Taiwan Independence’ separatist forces, and it is a legitimate and necessary action to safeguard China’s sovereignty and national unity," a PLA Eastern Theater Command statement said.

At least 20 Chinese warships and 50 jets were involved in the drills, the biggest in many months - and since early last year - to which Taiwan's military responded by dispatching its own aircraft and ships, and land-based missile systems on coastal areas.

Taiwan’s Ministry of National Defense listed out the following Chinese military weaponry which was moved near Taiwan by early afternoon:

  • 71 sorties by military aircraft and drones
  • 21 navy ships ranged around the island
  • Shandong aircraft spotted about 220 nautical miles east of Taiwan

The Eastern Theatre Command simultaneous to all of this issued a brief video calling Lai a "parasite" in English, also depicting him as a green bug dangled by chopsticks over a burning Taiwan.

According to the NY Times:

Ms. Zhu singled out a speech by Mr. Lai on March 13 in which he described China as a “foreign hostile force” and laid out 17 measures that Mr. Lai said would combat deepening Chinese subversion and spying in Taiwan.

Those included restoring military tribunals for cases against military personnel who spy and strengthening oversight of cultural, political and religious exchanges with China. Beijing says that Taiwan is its territory, and that it will eventually absorb the island, by force if Chinese leaders deem that necessary.

Taiwan officials have blasted the drills as "reckless" and "irresponsible". Taiwan's military subsequently elevated its readiness level to ensure China does not "turn drills into combat" and "launch a sudden attack on us."

During the kick-off to Hegseth's Asia visit, he hailed Japan in Sunday remarks as an "indispensable partner" in deterring Chinese aggression in the region. He further unveiled an upgrade in the US military command in Japan to a new "war-fighting headquarters".

China's Foreign Ministry in turn on Monday slammed the US’ use of "China threat" rhetoric which is bent on provoking confrontation, but which will end in regional countries being used as "cannon fodder" for US hegemony.

Taiwan’s Presidential Office posted on X that "China’s blatant military provocations not only threaten peace in the Taiwan Strait but also undermine security in the entire region, as evidenced by drills near Australia, New Zealand, Japan, Korea, the Philippines & the SCS. We strongly condemn China’s escalatory behavior."

Tyler Durden Tue, 04/01/2025 - 10:20

Manufacturing PMIs Sink Despite Surge In 'Hard' Data; Prices Paid Spike To 3-Year-Highs

Manufacturing PMIs Sink Despite Surge In 'Hard' Data; Prices Paid Spike To 3-Year-Highs

While hard data continues to improve, 'soft' data hit a new six-month low yesterday as more regional Fed surveys signaled trouble ahead (because of tariffs)...

Source: Bloomberg

And so all eyes are on the premier 'soft' data today as Manufacturing PMIs drop their final print for March.

The S&P Global Manufacturing PMI improved intra-month, rising from a  flash print of 49.8 (contraction) to a final print of 50.2 (expansion), but that was still well down from February's 52.7.

The ISM Manufacturing PMI weakened notably from 50.3 to 49.0 (below the 49.5 expectation) - the lowest since November.

Source: Bloomberg

Under the hood it was even more messy...

...with Prices Paid soaring to its highest since June 2022 and New Orders & Employment tumbling...

Source: Bloomberg

Inventories surged as manufacturers front-run the 'Liberation Day' headlines...

As Chris Williamson, Chief Business Economist at S&P Global Market Intelligence, notes:

“The strong start to the year for US manufacturers has faltered in March. A combination of improved optimism surrounding the new administration and the need to front-run tariffs had buoyed the goods-producing sector in the first two months of the year, but cracks are now starting to appear. Production fell for the first time in three months in March, and order books are becoming increasingly depleted.

Trump-based optimism is fading?

“While business confidence about the outlook remains relatively elevated by standards seen over the past three years, this is based on companies hoping that the nearterm disruption caused by tariffs and other policies will be superseded as longer-term benefits from the policies of the new administration accrue. However, March has seen more producers question this belief. Business optimism about the year ahead has deteriorated further from January’s near threeyear high, and has dropped sharply over the past two months, causing firms to stop raising payroll counts for the first time since October. 

And of course, it's all about tariff terror...

“A key concern among manufacturers is the degree to which heightened uncertainty resulting from government policy changes, notably in relation to tariffs, causes customers to cancel or delay spending, and the extent to which costs are rising and supply chains deteriorating in this environment. 

Tariffs were the most cited cause of factory input costs rising in March, and at a rate not seen since mid-2022 during the pandemic-related supply shock. Supply chains are also suffering to a degree not seen since October 2022 as delivery delays become more widespread. 

“Data in the coming months will provide important insights into how the inflationary aspects of policies such as tariffs balance out against any benefits to US producers.”

So, both Services PMIs are in expansion (above 50) and Manufacturing is mixed (50.2 vs 49.0) - take your pick on 'recession' talk.

Tyler Durden Tue, 04/01/2025 - 10:07

Trump Dials Back Putin Criticism, Renews Attacks On Zelensky For Stalling Minerals Deal

Trump Dials Back Putin Criticism, Renews Attacks On Zelensky For Stalling Minerals Deal

It was only on Sunday that President Trump declared he's "very angry" at Russian President Putin, statements which featured the threat of secondary tariffs on Moscow, but now the US leader is already dialing back this criticism, Bloomberg observes.

Instead he's once again focused his ire on Ukrainian President Volodymyr Zelensky, warning of "big problems" if he doesn't sign the controversial minerals agreement and tries to renegotiate. 

"I see he’s trying to back out of the rare earth deal. And if he does that, he’s got some problems. Big, big problems," Trump earlier told reporters aboard Air Force One. "We made a deal on rare earth and now he’s saying, ‘well, you know, I want to renegotiate the deal.’"

AFP/Getty Images

"He wants to be a member of NATO. Well, he was never going to be a member of NATO. He understands that. So if he’s looking to renegotiate the deal, he’s got big problems," Trump said.

Zelensky has signaled that Ukraine is positive about the deal but has complained that its conditions are "constantly changing".

Trump has still kept up some pressure on Putin, however, saying Monday of the Russian leader, "I want to make sure that he follows through, and I think he will." He continued in Monday remarks from the Oval, "I don’t want to go secondary tariffs on his oil, but I think, you know, something I would do if I thought he wasn’t doing the job."

All of the weekend criticisms of Putin appeared to arise from the Russian president's comments late last week declaring that Zelensky's 'illegitimacy' could be fixed by a UN transition process guiding Ukraine to new elections. Only then would Moscow negotiate an end the war, Putin stipulated.

"He’s supposed to be making a deal with him, whether you like him or don’t like him," Trump told reporters Sunday, referring to Putin. "So I wasn’t happy with that. But I think he’s going to be good."

But again, he reserved blunter criticism for US ally Zelensky: "I heard that they’re now saying, well, I’ll only do that deal if we get into NATO or something to that effect," Trump had said.

Bloomberg has concluded the following of this latest back-and-forth:

The result is a geopolitical whiplash on the eve of Trump’s global tariff announcement on April 2 and shows US impatience with the process of securing a temporary truce between Russia and Ukraine more than three years after Putin’s invasion of its neighbor. 

Trump had vowed he would end the war within 24 hours of taking office but has found Russia to be a tough negotiator and able to wrest concessions from the US by exploiting Trump’s desire to get a deal done quickly. On Sunday, Trump told NBC he was “pissed off” at Putin. 

Of course, this is also due to Russian forces rolling up several villages and towns on the battlefield in Ukraine's east and south just this week alone. Putin has less incentive for a hasty deal, and is in the driver's seat - but surely the White House knows this, which is perhaps why the pressure is ramping up on Zelensky once again.

As for the apparently ever-changing draft minerals deal, Ukraine and its supporters have continued to charge that it's tantamount to a big resource grab by Washington.

Ukraine received its latest version of a new draft of the text on Friday, its foreign ministry stated. CNN writes that "The new proposal for a natural resources agreement, of which CNN has obtained a copy, was put forward by the US Treasury Department and goes well beyond the initial draft, particularly on future US rights and reimbursement for past assistance."

Some independent geopolitical observers have said the deal effectively imposes 'indentured servitude' on Ukraine. "This 'deal' is pure extortion and robbery. It would bind Ukraine indefinitely. It would also discourage any investment in any natural deposits in Ukraine. There is no chance that any such deal will be ratified by the Ukrainian parliament," Moon of Alabama writes.

The source then questions, "one wonders then: Why does the Trump administration even bother?"

Tyler Durden Tue, 04/01/2025 - 10:00

April Fools

April Fools

By Michael Every of Rabobank

April Fools

Spot the April Fools’ Day jokes among the following recent headlines:

The Daily Mail says Trump could technically be President for a further two terms using a loophole Eisenhower considered, running as Vice President to a presidential candidate who resigns after they are sworn into office: then Trump alluded to that possibility.

The Financial Times’ chief foreign affairs commentator Gideon Rachman therefore recommends Americans “embrace and push forward” AOC and Bernie Saunders as a defence against a slide into authoritarianism, a-la “Russia, Turkey, and India.”

The Washington Post says a Department of Defence memo declares China the strategic focus, along with preventing the capture of Taiwan: Russia, Iran, North Korea, and terrorism are all secondary. Further, the US must now guarantee control over the Panama Canal and ensure a military presence in the "near abroad" --a Russian term-- of Greenland and Panama, the former of which Trump refuses to rule out the use of military force to obtain.

Worse, the memo says the US cannot fight on two fronts, so Europe must fight Russia itself. That’s as Moscow signed up another 160,000 conscripts, saying they won’t be sent to Ukraine, and Europe only did the latter; and Germany’s intel service reports Russia is most likely preparing for a "large-scale conventional war” with NATO by the end of the decade.

British Steel shut down its Scunthorpe plant after 150 years just as the UK aims to rearm. The government says it had “productive negotiations” with the US on an “economic prosperity deal” --not “co-prosperity”?-- as reports say London will buy F-35 fighter jets rather than Eurofighters; yet the UK was also just told “no free trade without free speech” by the US.

Finland’s President dropped in to play golf at Mar-a-Lago and emerged with a deal, Trump saying: “President Stubb and I look forward to strengthening the partnership between the US and Finland. That includes the purchase and development of a large number of badly needed icebreakers for the US."

Then again, the leading 2027 French presidential candidate, the National Rally’s Le Pen, has just been banned from running for office for five years and sentenced to four years for embezzlement. The same accusation had already circled the French Prime Minister, who wasn’t charged, and Le Pen called it a political attack and appealed, as populists, including Trump, rally round her. Moreover, El Pais reports the EU is considering using their Anti-Coercion Instrument on the US as a response to tariffs, which would be economically escalatory - and geopolitically naïve.

Slovakia’s populist Prime Minister Fico claims European Commission President Von der Leyen called him “a complete idiot” for half an hour in a phone call over his attempt to negotiate lower tariffs with the US directly.

Trump is “p***ed off” at Russia’s Putin and may put 25-50% secondary tariffs on Russian oil if he doesn’t play ball on Ukraine peace, as with/double Venezuela. The implications for the oil market are enormous – Brent is just shy of $75, which is surely not what ‘no Russian oil’ implies(?)

An IDF source says a clash with Iran is “inevitable”, and some muse on the same vis Israel-Turkey. Iran’s president rejected direct negotiations with the US, to which Trump replied: "If they don't make a deal, there will be bombing - and it will be bombing the likes of which they have never seen before." Iran then warned it will strike the Diego Garcia base if the US uses it to attack it --quite the logistical feat!- as a new airstrip appeared next to the Bab-el-Mandeb maritime chokepoint - a likely UAE contribution.

Trump’s first foreign visit as president will, again, be to Saudi in May, showing big changes may loom. That’s as Israel steels its border with Jordan and, with the unconditional backing of the US, demanded Egypt dismantle its growing military presence in the Sinai Peninsula. Moreover, as Israel’s PM Netanyahu was called out of one of his now-regular court corruption trial sessions for a police interview after two of his aides were arrested for receiving funds from Qatar.

US Secretary of Defence Hegseth just ramped up arms and promises to the Philippines and Japan, and claimed the latter shares a “warrior ethos”. Then China, Japan, and South Korea pledged deepened regional trade relations and, said Chinese media, a joint response to US tariffs, as well as an attempt to denuclearise North Korea.

China passed a law saying if it’s sanctioned by another state, it can legally expropriate that country’s firms’ IP or assets, just as it stressed how open to global businesses it is again.

Canada’s caretaker PM Carney proposed pivoting from “because markets” on housing to post-WW2 state interventionism. There’s a lot of that about, and markets clearly don’t like it.

The EU is reportedly exploring a weaker 2040 climate goal, keeping a 90% emissions-cutting target but changing how countries calculate their progress – either less now, more later; or letting other countries do it for them and buying carbon credits.

The US Trade Representative released a 397-page report detailing other economies’ non-tariff barriers ahead of tomorrow’s ‘Liberation Day’, which cover just about everything imaginable. That’s as The Wall Street Journal says, ‘The Era of Cheap Stuff Was Already Ending. Now Comes the Tariff Threat,’ and Bloomberg adds Trump tariffs “pose a generational challenge to Asian economies built around exports to the US and low trade barriers.”

Yet an FT op-ed yesterday argued ‘Globalisation will triumph over Donald Trump’, quoting those saying even if the US stops buying everything from everyone, within a year, 70 of its trading partners would have redirected all their exports to others, and within five years, 115 would have. To whom? Priced and cleared in which currency? And, if so, why are worrying about tariffs at all?

The market continues to ponder ‘dedollarisation’: in which case nobody is net exporting to the US or has future access to enough dollars to repay their outstanding Eurodollar debts, let alone import bills priced in it, so the global financial system crumbles – and I don’t mean a ‘correction’.

As @balajis puts it: “No reindustrialisation without dedollarisation. But dedollarisation means imperial collapse. On the other hand, so does deindustrialisation! This is the fundamental paradox.”  It has been for some time if you looked at the world with the right lenses, and they also show everything is now about US Grand Macro Strategy, not macrostrategy, to try to square the above circle by whatever means necessary: if lines on maps can move, so will lines on screens.

As two Fed speakers (Williams and Barkin) just said they don’t know where monetary policy needs to be ahead, and that the risk is of higher inflation ahead from tariffs despite matching uncertainty, @daniel_mcdowell puts it: “We're living through a natural experiment. Can economic and monetary orders built atop particular political orders survive when the latter are dismantled? Markets may very well be grossly underestimating the kind of economic changes heading our way if we continue on this course.”

So, how many April Fools were there today? None. Unless you aren’t looking at any of the above news - then there’s at least one.

Tyler Durden Tue, 04/01/2025 - 09:40

Xiaomi Shares Slide After SU7 Sedan With Intelligent Assisted Driving Crashes, Three Dead

Xiaomi Shares Slide After SU7 Sedan With Intelligent Assisted Driving Crashes, Three Dead

Shares of Chinese electric vehicle manufacturer Xiaomi tumbled in Hong Kong trading on Tuesday following a deadly crash involving one of its SU7 sedans, which claimed three lives on Saturday. The accident has intensified scrutiny over the safety of advanced driving systems, as data from the vehicle has been turned over to local authorities for investigation.

HK shares of Xiaomi closed down 5.5% and have since tumbled into a bear market since peaking in mid-March. Downward pressure began when it raised about $5.5 billion in an equity sale last week to fund EV expansion. 

"Investors might have concerns over Xiaomi's competitiveness and growth outlook after reports of the car accident," Shen Meng, director at Beijing-based investment bank Chanson & Co., said, adding that the completion of the share sale has "also weighed on sentiment."

The accident is the first major one involving the SU7 sedan, which Xiaomi launched in late 1Q24 and has outsold Tesla's Model 3 monthly since December. 

On Xiaomi's Weibo account, the company stated it was "deeply saddened" by the accident and said the "vehicle was in the NOA intelligent assisted driving state before the accident." 

Here are more details about the accident from Xiaomi:

At 22:44 on March 29, 2025, a Xiaomi SU7 standard version encountered a serious traffic accident while driving on the Chiqi section of the Deshang Expressway. We are deeply saddened by this.

According to preliminary information, the vehicle was in the NOA intelligent assisted driving state before the accident and continued to travel at a speed of 116km/h. Due to construction and repairs on the section where the accident occurred, the self-lane was closed with roadblocks and diverted to the reverse lane. After the vehicle detected the obstacle, it issued a reminder and began to slow down. The driver then took over the vehicle and entered the human driving state, continued to slow down and control the vehicle to turn, and then the vehicle collided with the cement pile of the isolation belt. The last speed that the system could confirm before the collision was about 97km/h.

After the collision, we immediately contacted the owner to understand that it was not the owner who was driving. At the same time, emergency rescue called the passengers on the car, called the police, and called 120 emergency services.

After that, the police arrived at the scene immediately and fully intervened in the investigation of the accident. At the same time, we immediately set up a special team and rushed to Tongling on the 30th. Under the guidance of the police, we actively cooperated with the investigation, evidence collection and other work, and submitted the vehicle driving data and system operation information we had to the police in accordance with the law on the evening of the 31st. We will continue to fully cooperate with the police and strictly follow the results of the investigation to ensure that the handling of the incident is open and transparent.

At the same time, our special team will also contact the families of the accident victims with the permission and guidance of the police, fully assist in the aftermath, and provide support and help.

We are summarizing the information we know so far and have submitted to the police as follows:

  • March 29, 22:27:17 NOA activated, vehicle speed 116km/h

  • March 29, 22:28:17 Mild distraction alarm March 29, 22:36:48 NOA issued a hands-off warning prompt "Please hold the steering wheel"

  • March 29, 22:44:24 NOA issued a risk warning "Please note that there are obstacles ahead", issued a deceleration request, and began to decelerate

  • March 29, 22:44:25 NOA was taken over and entered human driving state, the steering wheel turned 22.0625 degrees to the left, and the brake pedal was opened 31%

  • March 29, 22:44:26 The steering wheel turned 1.0625 degrees to the right, and the brake pedal was opened 38%.

  • Between 22:44:26 and 28 on March 29, the vehicle collided with the concrete guardrail on

  • March 29, 22:44:28 Ecall triggered on the vehicle side.

  • 22:44:39 on March 29. Ecall connected on the vehicle side, confirming the accident, calling the police and 120 emergency services.

  • 22:45:06 on March 29. Contacted the owner and confirmed that the driver was not the owner.

  • 22:47:15 on March 29. 120 was dispatched successfully.

  • 120 arrived at the scene at about 23:00 on March 29.

Here is an alleged video of the accident scene on the Dezhou-Shangrao Expressway in Tongling in southern Anhui Province, eastern China. 

Last month, Xiaomi raised its 2025 sales target to 350,000 units. Whether the fatal crash last weekend will dampen confidence and affect sales moving forward remains uncertain. 

Tyler Durden Tue, 04/01/2025 - 09:00

Futures Slide After WaPo Report Trump Seeks 20% Tariffs On Most Imports

Futures Slide After WaPo Report Trump Seeks 20% Tariffs On Most Imports

US equity futures fell abruptly just around 6am ET, reversing earlier gains and unable to benefit from the positive risk tone in European trade, hinting at another very volatile session on Wall Street, as tomorrow's tariffs "liberation day" loomed over markets. Gold extended its winning streak, rising to another record high. As of 8:00am ET, S&P futures were down 0.5%, reversing an earlier gain of 0.2%, after the Washington Post reported a White House proposal to impose tariffs of around 20% on most imports. Nasdaq futures slid 0.6% as Tesla rose modestly but other Mag 7 stocks were in the red. European and Asian markets both rose. Bond yields slid 4bps, pushing the 10Y yield to 4.16% while the USD traded higher on the back of Euro weakness. Commodities are mostly flat this morning with base metals declining (copper -0.9%). Overnight, headlines were largely light, with geopolitical tension and trade policy remaining uncertain. Trump seems to dial back his criticism on Putin, per BBG article (here). We will get the Final March ISM-Mfg this morning: consensus expects the Index to print 49.5 survey vs. 50.3 prior; we also get the latest JOLTS report.

In US premarket trading, Tesla rose while fellow Magnificent Seven stocks edge lower (Tesla +3.1%, Nvidia +0.6%, Alphabet +0.5%, Meta +0.2%, Amazon +0.3%, Microsoft +0.2%, Apple -1%). Johnson & Johnson slid 3.5% in premarket trading after a judge rejected its third attempt to use bankruptcy of one of its units to end baby powder cancer claims. Delta Airlines Inc. and Southwest Airlines Co. fell after Jefferies analysts cut their ratings on concern about consumer spending. Here are some other notable premarket movers:

  • Newsmax shares jump 11%, putting the conservative media outlet’s stock on track to extend gains after it jumped 735% in its debut Monday.
  • Live Nation slip 1.5% after President Donald Trump said he will sign an executive order aimed at tackling ticket scalping, saying that it is a “big step” in dealing with an issue that “bothers” a lot of artists
  • Microvast shares surge 26% after the lithium-ion battery maker reported 2024 revenue that beat its guidance thanks to growing demand for its technology.
  • Gorilla Technology shares drop 6.4% after the analytics technology firm reported full-year results and reiterated its revenue forecast for 2025.
  • Intel slid after new CEO Lip-Bu Tan said the chipmaker will spin off assets that aren’t central to its mission and create new products including custom semiconductors to try to better align itself with customers

President Donald Trump will announce his reciprocal tariff plan at 3 p.m. on Wednesday at an event in the White House Rose Garden, but the extent of his levies remain unclear. There’s also confusion around whether the US president will take a lenient or harder tack, making investors wary of risky stock bets. 

“Investors are grappling with what could be announced this week,” said Laura Cooper, global investment strategist at Nuveen. “The range of outcomes is so wide that traders are struggling with how to price in that potential outcome.”

Futures were hit shortly after 6am after the WaPo reported that White House aides have drafted a proposal to impose tariffs of around 20% on most imports to the United States. In a hitpiece that appears intended to spark panic and restart the selloff, the authors write that "if implemented, the plan is likely to send shock waves through the stock market and global economy. Assuming that permanent tariffs took effect in the current quarter and triggered robust retaliation by U.S. trading partners, the economy would almost immediately tumble into a recession that would last for more than a year, sending the jobless rate above 7 percent, according to Mark Zandi, chief economist for Moody’s, who described the results as a worst-case scenario."

Trump has touted his April 2 announcement as a “Liberation Day,” heralding the start of a more protectionist policy meant as retribution against trading partners he has long accused of “ripping off” the US. He has already placed levies on Canada, Mexico and China — the US’s three largest trading partners — as well as automobiles, steel and aluminum. Import taxes on copper could come within several weeks. He has also threatened duties on pharmaceutical, semiconductor and lumber imports.

Many fear Trump’s announcement will mark the start of lengthy and fractious negotiations with trade partners, pressuring the economy and keeping market volatility elevated. On Tuesday, European Commission President Ursula von der Leyen said the bloc is prepared to retaliate if reciprocal tariffs are imposed.

“We could get another period of potential negotiations which is just going to prolong this uncertainty and underpin further choppy price action,” Nuveen’s Cooper said.

As tariffs loom, US carmakers are lobbying the administration to exclude certain low-cost car components, Bloomberg reported. The EU said it will use a broad range of options to retaliate. An analysis by Bloomberg Economics found that a maximalist approach could add up to 28 percentage points to the average US tariff rate — resulting in a hit of 4% to US GDP.

Strategists at Citigroup said that a surge in short flows pushed net positioning for the Nasdaq back to neutral ahead of tariff announcements. Barclays strategists, meanwhile, said that hedge funds and CTAs turned short US equities and long Treasuries last month, likely improving the risk-reward outlook into April 2.

Chip stocks could be in focus after Commerce chief Lutnick signaled he could withhold promised Chips Act grants as he pushes companies in line for subsidies to expand their US projects.

Europe's Stoxx 600 rose 1.2% and is on course to snap a four-day losing streak as concerns regarding imminent US trade tariffs appear to have subsided. All 20 sectors are in the green, with auto, industrial and technology names leading gains. Goldman Sachs strategists cited a weaker growth outlook as a reason to cut their forecast for Europe’s Stoxx 600, following a similar move from the US team. The team led by Sharon Bell trimmed the 12-month target on the index to 570 points from 580. Here are the biggest movers Tuesday:

  • Europe’s biggest pharmaceutical companies advance, making healthcare the best performing Stoxx 600 subgroup, after JPMorgan analysts say potential US tariffs are expected to have a “manageable impact” on the sector
  • Gubra shares jump as much as 19% after the Danish drugmaker said interim phase 1 results for its obesity treatment candidate GUBamy were “positive.” Shares trim some gains to rise 12% at 10.27am CET
  • Greencore Group shares rise as much as 11% after the food producer said better-than-expected profit conversion means its FY25 adjusted operating profit will be ahead of current consensus. Analysts at Jefferies said the positive update
  • Enav shares jump after results met estimates and the air navigation services firm said it sees an annual revenue growth of 4.3% by 2029; Banca Akros’ Francesco Sala says the results were in line with estimates
  • UK supermarket stocks fall as a Kantar report adds to concern over increasing competitive pressures across the industry. Separately, BNPP Exane cuts earnings estimates for Tesco and Sainsbury, while downgrading the latter
  • Genmab falls as much as 5.4% after Bernstein cut its rating on the biotechnology company to underperform, saying the share price is far from fully discounting the loss of exclusivity for its Darzalex blood cancer treatment
  • Zealand Pharma shares drop as much as 6.3%, worst performer in the Stoxx 600 Health Care Index, after smaller Danish drug developer Gubra said interim early-stage results for its experimental obesity treatment were positive
  • Travis Perkins shares fall as much as 13% to their lowest since June 2009 after the wholesaler said there was uncertainty regarding recovery in UK construction activity and challenging market conditions have continued
  • Interroll shares drop as much as 2.6% after Kepler Cheuvreux cut the recommendation on the Swiss industrial equipment firm to reduce from hold, citing limited near-term catalysts and high valuation

Earlier in the session, Asian equities also rose, poised to snap a three-day selloff as traders reassessed positions ahead of the planned imposition of more US tariffs. The MSCI Asia Pacific Index advanced as much as 1.1%, led by gains in Taiwan, South Korea and Hong Kong. TSMC, Tencent and Samsung Electronics were among the biggest boosts. Traders remained on edge, however, with 30-day volatility on the gauge trading around the highest level since October. Most key Asian benchmarks were in the green on Tuesday. India was an exception, with tech heavyweights sliding on concern that slower growth in the US may hurt spending by their clients. Markets in Indonesia, Malaysia and the Philippines were shut for holidays. 

The rebound doesn’t signal “much about the overall market’s direction in next 6 to 12 months,” said Homin Lee, senior macro strategist at Lombard Odier Singapore. “It will still be important to get the details of Trump’s announcements tomorrow given the significant - and potentially market-negative - complexities implied in the tariff framework Trump appears to be considering.”

In FX, the Bloomberg Dollar Spot Index is little changed. The Aussie dollar pared gains seen after the RBA stood pat on rates with a slight hawkish tinge to the statement. The Swedish krona takes top spot with a 0.5% gain.

In rates, treasuries continue to benefit from haven demand, with futures reaching session highs after the Washington Post reported a White House proposal to impose tariffs of around 20% on most imports. Additional support comes from steeper gains for bunds after euro-area inflation eased further toward the European Central Bank’s 2% target, and declines for S&P 500 futures. US yields are 2bp-4bp richer across maturities with gains led by intermediates, flattening 2s10s spread by around 2bp; 10-year is on session lows around 4.165% with bunds and gilts outperforming by 3bp and 2.5bp in the sector. European government bonds are broadly higher with UK and German 10-year borrowing costs falling 6 bps each. Traders have added to their ECB and BOE interest-rate cut bets, although there was little reaction to euro-area CPI data - the headline matched forecasts while the core rate slowed slightly more than expected. US session includes March US manufacturing PMIs from S&P Global and ISM.

In commodities, spot gold adds $10 to $3,133 having notched another record high earlier near $3,150. WTI is steady near $71.50 a barrel. Bitcoin rises over 2% to above $84,000. 

Today's US economic calendar includes March final S&P Global US manufacturing PMI (9:45am), February construction spending, JOLTS job openings and March ISM manufacturing (10am) and Dallas Fed services activity (10:30am). ed speaker slate includes Richmond Fed’s Barkin discussing monetary policy and the economic outlook (9am).

Market Snapshot

  • S&P 500 mini -0.5%
  • Nasdaq 100 mini -0.4%
  • Russell 2000 mini +0.1%
  • Stoxx Europe 600 +1.2%, DAX +1.5%, CAC 40 +0.9%
  • 10-year Treasury yield -3 basis points at 4.18%
  • VIX +0.1 points at 22.39
  • Bloomberg Dollar Index little changed at 1274.63
  • euro little changed at $1.0806
  • WTI crude -0.3% at $71.23/barrel

Top Overnight News

  • The US plans to extend the 2017 tax cuts, making them permanent and adding Trump’s campaign promises like eliminating taxes on tips, overtime pay and Social Security, Treasury Secretary Scott Bessent told Fox News. BBG
  • Howard Lutnick may withhold Chips Act grants to push companies to expand their US projects, people familiar said.  Lutnick aims to generate tens of billions of dollars in additional investment commitments without increasing the size of federal grants. Donald Trump created a new office to manage the Chips Act’s funds and speed up some investments in the US. BBG
  • President Trump signed an executive order establishing the United States Investment Accelerator which establishes an office within the Department of Commerce meant to facilitate and accelerate investments above USD 1bln in the US, while the White House said the Investment Accelerator is to administer the CHIPS program office.
  • Trump signed an executive order aimed at protecting fans from 'exploitative ticket scalping' and reforming the US live entertainment ticketing industry, according to Reuters.
  • Republicans could be poised to deal a symbolic blow to President Donald Trump’s trade policy, with several GOP senators indicating they planned to join Democrats in a Tuesday vote to block blanket tariffs on Canada (although the bill will probably never become law). Politico
  • President Trump said that he had settled on a plan for his latest batch of tariffs expected this week but didn’t reveal what he had decided, after his economic team struggled to coalesce around a remade U.S. trade strategy. He wants to both raise revenue with tariffs and use them as leverage to get other nations to lower their own duties, or make other policy changes.
  • Boeing (BA) slows the production of 737 Max to 31 craft per month (current 38) to keep from derailing the assembly line, via Air Current; further slowing wing production.
  • Eurozone CPI for Mar comes in a bit cooler than anticipated on a core basis (+2.4% vs. the Street +2.4% and down from +2.6% in Feb) while headline was inline at +2.2% (down from +2.3% in Feb). BBG
  • The European Union said it will use a broad range of options to retaliate against the US if President Donald Trump follows through on his threat to impose so-called reciprocal tariffs on the bloc this week. “We do not necessarily want to retaliate,” European Commission President Ursula von der Leyen said on Tuesday. “If necessary we have a strong plan to retaliate and will use it.” BBG
  • China's factory activity expanded at its fastest pace in four months in March, buoyed by stronger demand and robust export orders, a private-sector survey showed on Tuesday. The Caixin/S&P Global manufacturing PMI climbed to 51.2 in March from 50.8 in the previous month, surpassing analyst expectations of 51.1. The 50-mark separates growth from contraction. RTRS
  • China has kicked off large-scale military and coastguard exercises around Taiwan, the latest round in Beijing’s escalating campaign to assert its claims of sovereignty and suppress the island nation’s efforts to preserve its de facto independence. The drills on Tuesday came as Taiwan’s President Lai Ching-te seeks to improve military and civilian preparedness for a potential Chinese attach and strengthen society to defend against espionage and other infiltration from China, which last month he called a “hostile foreign force.” FT
  • China, Japan and South Korea agreed to jointly respond to U.S. tariffs, a social media account affiliated with Chinese state media said on Monday, an assertion Seoul called "somewhat exaggerated", while Tokyo said there was no such discussion. The state media comments came after the three countries held their first economic dialogue in five years on Sunday, seeking to facilitate regional trade as the Asian export powers brace against U.S. President Donald Trump's tariffs. RTRS

Tariffs/Trade

  • US President Trump said we will see tariff details maybe Tuesday night or on Wednesday which are going to be nice in comparison to other countries and in some cases, they may be substantially lower. Trump also stated that many countries have been looting the US and they will stop that on April 2nd, as well as noted there will be investments worth USD 5tln in the US. Furthermore, he stated that TikTok is not tied to a larger tariff deal but could be.
  • US Treasury Secretary Bessent said President Trump will announce reciprocal tariffs at 15:00EDT/20:00BST on Wednesday.
  • US automakers seek to exclude low-value car parts from tariffs, according to Bloomberg.
  • US State Department said Secretary of State Rubio spoke to his Mexican counterpart regarding the US automobile industry, while Rubio thanked Mexico for efforts to reduce illegal immigration and continuing to accept deportation flights.
  • China's Foreign Minister Wang Yi said higher US tariffs on Chinese goods are unreasonable and harm global markets.
  • UK Trade Secretary Reynolds says, "we are hopeful that Trump's tariffs will be reversed within weeks, or months"; adds, "It appears tomorrow there'll be no country in the world exempt from the initial announcements", via BBC Breakfast.
  • EU Commission President von der Leyen says the bloc has the power to push back against US tariffs; all instruments are on the table for countermeasures; EU is open to negotiations on trade. Says EU needs to take down the remaining barriers in the single market. Adds, EU has a strong plan to retaliate if necessary and will use it.
  • UK PM Starmer says discussions on an economic deal with the US are "well advanced".

A more detailed look at global markets courtesy of Newsquawk

APAC stocks traded mostly higher as markets recovered from the recent sell-off and with sentiment helped by data releases although gains were capped as tariff uncertainty persists heading into April 2nd 'Liberation Day' reciprocal tariffs. ASX 200 advanced with broad gains seen across sectors, while there was a muted reaction to the RBA rate decision  in which the central bank maintained the Cash Rate at 4.10% as unanimously forecast and provided little clues for future policy. Nikkei 225 rallied at the open after data showed a decline in the Unemployment Rate and a mostly better-than-expected Tankan survey although the index then pulled back and gradually reversed the gains after failing to sustain a brief reclaim of the 36,000 level. Hang Seng and Shanghai Comp were underpinned after stronger-than-expected Chinese Caixin Manufacturing PMI data.

Top Asian News

  • Some Chinese banks have reportedly started raising interest rates amid growing bad consumer loans, weeks after cutting rates, according to Reuters sources; the move is expected to weigh on Beijing's efforts to stimulate the economy
  • RBA kept the Cash Rate unchanged at 4.10%, as expected, while it stated the outlook remains uncertain, underlying inflation is moderating and sustainably returning inflation to target is the priority. RBA noted that monetary policy is well placed to respond to international developments if they were to have material implications for Australian activity and inflation, and noted that the board’s assessment is that monetary policy remains restrictive. Furthermore, it stated the continued decline in underlying inflation is welcome, but there are nevertheless risks on both sides and the board is cautious about the outlook, while the board needs to be confident that this progress will continue so that inflation returns to the midpoint of the target band on a sustainable basis.
  • RBA Governor Bullock said in the post-meeting press conference there is a chance of more strength in the economy than seems and the board will continue to look at the data, while she said the board did not discuss a rate cut and holding rates was a consensus decision. Bullock also stated they have to be careful not to get ahead of themselves on policy and that the board has not made up its mind on a May move, while she said they are not endorsing the market path on future rate cuts. Furthermore, she said the board did not open the door to a May rate cut and there is more economic data to come, as well as updated forecasts for the May meeting.
  • RBNZ said the Board is in the process of preparing a recommendation for the appointment of a Governor for six months and will be sending it to the minister soon, while it continues business as usual with Deputy Governor Christian Hawkesby as acting Governor and CEO until such time the minister makes an appointment.

European bourses (STOXX 600 +0.9%) are entirely in the green, as the region recovers from the prior day’s hefty losses. Indices have gradually climbed higher as the morning progressed. European sectors hold a strong positive bias, but with no clear outperformer and with gains fairly broad based given the risk tone. Healthcare leads the pack today, lifted by strength in AstraZeneca (+1.5%) after it reported positive trial results for its cholesterol drug, which has boosted hopes of another blockbuster drug. Consumer Products is a little higher today, with clothing brands benefiting in tandem with post-earning strength in PVH (+15.8% pre-market) which beat Q4 analyst expectations.

Top European News

  • BoE's Greene says slack is opening up in the UK labour market, happy with central forecast for inflation, disinflation continues to be underway. There is a risk that productivity growth recovery does not happen as the BoE assumes. Rising UK public inflation expectations are concerning, "I think they remain anchored". Dollar's role as a reserve currency could be undermined by the current uncertainty.
  • ECB's Rehn says if the data verifies the baseline, the right reaction in monetary policy should be to cut in April, via Politico
  • ECB's Cipollone says "Digitalisation is driving economic progress and transforming the way we make retail payments".

FX

  • DXY is currently slightly softer but with FX markets broadly in a holding pattern in the run up to Wednesday's "Liberation Day". Ahead of which, US President Trump is said to be still deciding which plan he will take for reciprocal tariffs and has been presented with "multiple" tariff plans, according to administration sources cited by FBN's Lawrence. Today's US data docket includes JOLTS and ISM Manufacturing.
  • EUR is trivially firmer vs. the USD following an indecisive session yesterday whereby markets digested softer-than-expected German inflation data and ECB sources. On the latter, Bloomberg reported that several ECB officials are still wavering on whether to cut interest rates next month.
  • USD/JPY has failed to sustain a move above the 150 mark as markets digested mostly better-than-expected data via the latest unemployment and Tankan metrics. USD/JPY has delved as low as 149.51 but is some way off Monday's trough at 148.69.
  • GBP is flat vs. the USD with fresh macro drivers for the UK on the light side aside from non-incremental comments from BoE's Greene that slack is opening up in the UK labour market and disinflation is continuing. Elsewhere, UK PM Starmer noted that discussions on an economic deal with the US are "well advanced". Cable is currently holding above the 1.29 mark and within yesterday's 1.2885-1.2972 bounds.
  • Antipodeans are steady vs. the USD with little sustained follow-through from the RBA rate decision. As expected, the RBA held the Cash Rate at 4.1% as unanimously forecast and provided little clues for future policy. In the follow-up press conference, Governor Bullock noted the board did not discuss a rate cut - which did help to lift the Aussie slightly.
  • PBoC set USD/CNY mid-point at 7.1775 vs exp. 7.2606 (Prev. 7.1782).

Fixed Income

  • USTs are firmer, and while the move is significant on the session, USTs are yet to surpass the top-end of yesterday’s 111-04 to 111-22+ band. Overall, the narrative remains much the same as markets countdown to "Liberation Day" and await any possible announcements/details on the eve of it. Ahead of that, traders will await US ISM Manufacturing PMI and JOLTS data.
  • A similar narrative to USTs with Bunds firmer and at a 129.42 peak but shy of Monday’s 129.59 best. If that is surpassed, resistance features at 130.00 before 130.93 from mid-January. The bid this morning in EGBs, and fixed generally, comes as the market is seemingly, for now at least, more concerned with the growth implications than the inflation implications of the looming US measures. Tariffs/trade aside, the morning has seen modest downward revisions to March’s Manufacturing PMIs - though this move was not sustained. And on the inflation front, EZ HICP printed in-line on the headline and cooler than expected for the core and super-core Y/Y. Additionally, the Services Y/Y figure moderated to 3.4% (prev. 3.7%) - despite the cooler figures, a hawkish move was seen.
  • Gilts are bid but, unlike its peers above, has managed to eclipse Monday’s 92.10 high to a 92.45 peak for the week. A level which encounters resistance from earlier in the month at 92.46, 92.48 and 92.56. Newsflow has unsurprisingly been focused on tariffs, with reports indicating that the UK-US trade deal has broad agreement and is ready to be signed once a few details are ironed out. Commentary from BoE's Greene has had little impact on UK-paper.
  • Germany sells EUR 3.418bln vs exp. EUR 4.5bln 2.20% 2027 Schatz: b/c 3.5x (prev. 2.4x), average yield 2.01% (prev. 2.22%), retention 24.04% (prev. 22.29%)

Commodities

  • A choppy session for the crude complex this morning. Price action was initially downward, giving back some of the prior day's upside, but recent CPC pipeline related newsflow has sparked a paring of this pressure and lifted the benchmarks marginally into the green . Reuters reported that Kazakhstan will have to start reducing oil production within days as CPC pipeline reduces intake. WTI May resides in a USD 71.27-71.75/bbl range while Brent June sits in a current USD 74.58-75.02/bbl parameter.
  • Mixed trade across precious metals with spot gold continuing to hold near record highs, whilst spot silver is subdued and spot palladium coat-tails the gains across the Auto sector this morning. Spot gold currently resides in a USD 3,120.12-3,149.09/oz range.
  • Mostly firmer trade across base metals, with the complex buoyed by the better-than-expected Chinese Caixin Manufacturing PMI data overnight which bodes well for the demand side of the equation. 3M LME copper currently trades in a narrow USD 9,712.40-9,794.00/t range.
  • Kazakhstan will have to start reducing oil production within days as CPC pipeline reduces intake, according to Reuters citing multiple sources; CPC repairs will take more than a month, according to a singular source.
  • Russian oil product exports from Black Sea Port of Tuapse planned at 0.864mln tons in April (prev. scheduled 0.798mln tons in March).
  • Norway's Gassco sees higher gas deliveries Y/Y this summer due to less maintenance.

Geopolitics: Middle East

  • Israeli military said it attacked a Hezbollah target in Beirut's southern suburbs.
  • Iran complained to the UN about reckless and belligerent remarks by US President Trump and said the remarks are a flagrant violation of international law and core principles of the UN Charter, according to a letter seen by Reuters. Iran said it is deeply regrettable and concerning that the US wields military power as its primary tool of coercion to advance political and geopolitical objectives, while it warned it will respond swiftly and decisively to any act of aggression or attack by the US or Israel against its sovereignty, territorial integrity or national interests.

Geopolitics: Ukraine

  • Ukraine's Foreign Minister says one round of consultations with the US has taken place on the new draft of the minerals deal, the process continues, the text entails strong presence of American business in Ukraine, which contributes to security.
  • US President Trump said he wants to see Russian President Putin make a deal and wants to make sure Putin follows through, while Trump added he doesn't want to do secondary tariffs but noted secondary tariffs are something that he would do if Putin doesn't do the job.
  • Russia Defence Ministry says Ukraine continues its attacks on Russia's energy infrastructure, via Interfax; Ukraine attacked Russia's energy infrastructure twice in the last 24hrs.

Geopolitics: China

  • Chinese military conducted joint army, navy and rocket force exercises around Taiwan, while it stated that sinister moves of Taiwan separatists will cause disaster for themselves and called Taiwan President Lai a parasite in a video related to the drill.
  • Taiwan senior officials noted that more than 10 Chinese military ships approached close to Taiwan's 24 nautical mile contiguous zone on Tuesday morning and Taiwan dispatched its own warships to respond, while Taiwan's presidential official strongly condemned China's military drills and said China is widely recognised by the international community as a troublemaker.
  • De facto US embassy in Taiwan said it is closely monitoring China's military activity near Taiwan and that China has shown that it is not a responsible actor and has no problem putting the region’s security and prosperity at risk. It also stated the US will continue to support Taiwan in the face of China’s military, economic, informational, and diplomatic pressure campaign.

Geopolitics: Other

  • US President Trump responded that there is communication when asked about North Korea and commented that he will probably do something on North Korea.
  • US Secretary of State Rubio said the US is taking steps to impose visa restrictions on Chinese officials substantially involved in policies related to access for foreigners to Tibetan areas.

US Event Calendar

  • 9:45 am: Mar F S&P Global U.S. Manufacturing PMI, est. 49.85, prior 49.8
  • 10:00 am: Feb Construction Spending MoM, est. 0.3%, prior -0.16%
  • 10:00 am: Feb JOLTS Job Openings, est. 7655k, prior 7740k
  • 10:00 am: Mar ISM Manufacturing, est. 49.5, prior 50.3
  • 10:00 am: Mar ISM Prices Paid, est. 64.6, prior 62.4

DB's Jim Reid concludes the overnight wrap

Happy April Fools' Day. I could make up a wild story here but it might be boring relative to realities these days. Having said that, 15 years ago today I went on a first date with my wife. I think she now thinks that there has been a decade and a half long April Fools' joke at her expense. So thoughts are with her this morning.

For US markets Q1 seemed like a bad joke as the rest of the world left it behind in equity terms. Henry will soon be releasing our regular performance review, running through how different assets fared over the quarter just gone. It’s fair to say it was a historic period for markets, as the combination of US tariffs, the European fiscal shift, and DeepSeek’s AI model led to a huge reappraisal about the near-term outlook. Indeed, the S&P 500 has just posted its worst month in two years. However, European equities did very well by comparison, with the DAX up +11.32% YTD thanks to the fiscal impulse. And given the general risk-off tone and stagflationary fears, gold put in its best quarterly performance since 1986. See the full review in your inboxes shortly.

Some of those Q1 trends did reverse yesterday amid a jittery quarter-end session as investors await the US reciprocal tariffs announcement tomorrow. The S&P 500 recovered from -1.65% down shortly after the open, when it was briefly back in correction territory, to close +0.55% higher, while the STOXX 600 (-1.51%) fell to a two-month low. On the US side there must have been some quarter end flows that made a difference, especially as US equity futures are back down nearly half a percent this morning.

The losses for the STOXX 600 means that it has now unwound over half of its YTD gains, having risen +5.18% since the start of the year, though it is still way ahead of the S&P 500’s -4.59% decline. And even as US equities outperformed, the gains for the S&P were led by defensive sectors with consumer staples (+1.63%) leading the way. By contrast, the Magnificent 7 (-0.41%) moved lower, while the VIX (+0.62pts) rose for a fourth consecutive session, reaching a two-week high of 22.28. And over in Japan, yesterday saw the Nikkei fall -4.05%, marking its biggest daily decline since September. This morning it's given up most of its attempts to rally back and is only just above flat.

In terms of the upcoming tariff announcement, we still don’t know which countries they’ll be imposed on and what rate. It's fair to say that the administration might not have the final plan ready as yet. Yesterday, White House Press Secretary Leavitt said a planned Rose Garden announcement would feature “country-based” tariffs, with further sectoral duties to come later, while last night Treasury Secretary Bessent said on Fox News that Trump will announce the reciprocal tariffs at 3pm EST on Wednesday. Bessent also said that he was working with Republicans in Congress to deliver Trump’s fiscal campaign promises, including “No tax on tips, no tax on Social Security, no tax on overtime”.

A big concern for investors is that the US tariffs will be met by retaliatory moves, which in turn could lead to a further round of escalation as the US seek to respond. So that’s meant inflation expectations have continued to rise, with the 1yr US inflation swap (+13.3bps) yesterday hitting another two-year high of 3.25%. Other traditional inflation hedges have done well on the back of that, with gold prices (+1.24%) moving up to another record high of $3,124/oz. And matters weren’t helped yesterday by a fresh rise in oil prices, with Brent crude (+1.51%) moving up to a one-month high of $74.74/bbl. So collectively, that’s served to exacerbate existing concerns about inflationary pressures.

Those losses cascaded across global markets, and mounting fears of a US downturn led to a fresh decline in Treasury yields. For instance, the 2yr yield (-2.8bps) fell back to 3.89%, whilst the 10yr yield (-4.3bps) fell to 4.21% with a further -1.15bps fall in Asia so far. That came as investors dialled up the likelihood of Fed rate cuts over the rest of the year, with the amount priced in by the December meeting up +2.7bps on the day to 76bps. Those declines in yields would have been even greater were it not for the move up in inflation expectations, as the 2yr real yield (-4.5bps) hit a two-and-a-half year low of 0.60%.

Over in Europe, sovereign bonds had initially rallied as well, but those moves were pared back after Bloomberg reported that ECB officials were questioning whether they should cut rates again at the next meeting. They’ve already delivered 150bps of easing since last June, but inflation is still lingering slightly above target, and the article said that policymakers were thinking about a pause given the uncertainty over tariffs and higher military spending. There was no sourcing in the article so its not clear it was anything other than observing the facts as they stand. Regardless of this, yields on 10yr bunds (+1.0bps), OATs (+2.1bps) and BTPs (+1.9bps) had all moved slightly higher. An April cut by the ECB was 73% priced by the close, having been at nearly 90% early in the session but falling as low as 65% after the Bloomberg story broke.

Earlier in the day, we also had the latest inflation data from Germany, where the EU-harmonised print surprised on the downside at +2.3% (vs. +2.4% expected). That followed last week’s releases showing downside surprises in France and Spain, so those collectively pointed on the downside. However, the Italian reading yesterday was stronger than expected, moving up to +2.1% (vs. +1.8% expected), so that pointed in the other direction. We’ll get the Euro Area-wide numbers today, so that’ll be an important input for the ECB’s next decision in just over two weeks’ time.

Staying on Europe, there was significant political news out of France, as the National Rally’s Marine Le Pen was given a five-year election ban after being convicted of embezzling EU funds. That means she wouldn’t be able to run in the next presidential election in 2027, but Le Pen’s lawyer said that she’ll appeal the verdict. Later in the evening, Le Pen criticised the ruling as a “political decision”, saying she would fight for the right to run for President.

Asian equities are recovering this morning after Wall Street’s overnight gains but performance is mixed. Across the region, the KOSPI (+1.89%) is leading gains with the Hang Seng (+1.06%) also trading notably higher. Elsewhere, the Nikkei's (+0.20%) recovery is disappointing after yesterdays -4.05% rout where it hit a six-month low. The S&P/ASX 200 (+0.92%) is also trading higher after the RBA decided to leave rates unchanged while Chinese equities are edging higher with the CSI (+0.29%) and the Shanghai Composite (+0.59%) both trading in the green as China’s factory activity beat forecasts (more below). S&P 500 (-0.40%) and NASDAQ 100 (-0.45%) futures are moving back lower.

As was widely expected, the RBA left the Official Cash Rate (OCR) unchanged at 4.1% at the conclusion of the April monetary policy meeting this morning. In an accompanying statement the central bank sounded cautious about the outlook and reiterated that returning inflation sustainably to target remains the highest priority, thus failing to give clarity on when the next rate cut might arrive. Attention now turns to the next two-day meeting on 19-20 May, where markets expect a second cut after February’s 25bps cut, which was the first reduction since late 2020.

Coming back to China, manufacturing activity grew more than expected to a four-month high as the Caixin manufacturing PMI hit 51.2 in March (v/s 50.6 expected) due to a sustained rise in new orders. It follows the prior month’s reading of 50.8. The Caixin data comes after the official PMI over the weekend, which showed the manufacturing sector grew a bit more than expected in March.

To the day ahead now, and US data releases include the ISM manufacturing for March, and the JOLTS report for February. Elsewhere, we’ll get the global manufacturing PMIs for April, the Euro Area flash CPI print for March, and the Euro Area unemployment rate for February. Central bank speakers include ECB President Lagarde, and the ECB’s Vujcic, Cipollone and Lane, along with the Fed’s Barkin and the BoE’s Greene. And in the political sphere, there are two special elections taking place for the US House of Representatives in Florida.

Tyler Durden Tue, 04/01/2025 - 08:26

Sen. Chuck Grassley Introduces 'Judicial Relief Clarification Act' To Rein In Activist Judges

Sen. Chuck Grassley Introduces 'Judicial Relief Clarification Act' To Rein In Activist Judges

Authored by Debra Heine via American Greatness,

Senate Judiciary Committee Chairman Chuck Grassley (R-Iowa) introduced a proposal  Monday to rein in judicial injunctions like the ones currently hampering President Donald Trump’s popular MAGA agenda.

The Judicial Relief Clarification Act of 2025 (JRCA) would “limit federal court orders to parties directly before the court, ending the practice of universal injunctions,” according to a Judiciary Committee Majority press release. The bill also aims to clarify the constitutional role of the judicial branch.

According to a Judiciary Committee fact sheet, the JRCA:

1. Forbids federal courts from issuing sweeping relief against the government to persons not before the court—ending the practice of universal injunctions and diminishing the
incentive to forum shop for a sympathetic judge.
2. Requires parties seeking universal relief against the government to use the class action process to show that class-wide relief is proper.
3. Makes temporary restraining orders (TROs) immediately appealable, strengthening appellate review.
4. Amends the Administrative Procedure Act (APA) and Declaratory Judgment Act to clarify that courts may only issue relief under those statutes to parties before the court.

Sen. Grassley will hold a hearing Wednesday to discuss his  “legislative solutions to the bipartisan problem of universal injunctions.”

The proposal comes after a slew of district court rulings and orders blocked multiple key Trump administration objectives, including efforts to end birthright citizenship, terminate federal grants, end DEI initiatives and use a wartime law to deport criminal illegal immigrants.

President Trump has railed against the rulings, accusing the judges of usurping his executive authorities.

In an oped in the Wall Street Journal over the weekend, Grassley wrote: “these nationwide injunctions have become a favorite tool for those seeking to obstruct Mr. Trump’s agenda.”

More than two-thirds of all universal injunctions issued over the past 25 years were levied against the first Trump administration. In the past two months alone, judges have issued at least 15 universal injunctions against the administration—surpassing the 14 President Biden faced throughout his four-year term.

“These decisions also place undue stress on the judicial system by inserting political calculation into the selection of the judges and the resolution of disputes,” the senator wrote.

Grassley pointed out that this judicial overreach has occurred amid an NBC poll showing that “more registered voters believe our country is on the right track than at any other point in the past two decades.”

“For a number of years, but particularly in the last few months, we’ve increasingly seen sweeping orders from individual district judges that dictate national policy,” he said in a statement, Monday.

“Our Founders saw an important role for the judiciary, but the Constitution limits judges to exercising power over ‘cases’ or ‘controversies.’ Judges are not policymakers, and allowing them to assume this role is very dangerous,” Grassley said. “The Judicial Relief Clarification Act clarifies the scope of judicial power and resolves illegitimate judicial infringement upon the executive branch. It’s a commonsense bill that’s needed to provide long-term constitutional clarity and curb district courts’ growing tendency to overstep by issuing sweeping, nationwide orders.”

The bill is cosponsored by Sens. John Barrasso (R-Wyo.), Marsha Blackburn (R-Tenn.), Katie Britt (R-Ala.), Ted Budd (R-N.C.), Bill Cassidy (R-La.), John Cornyn (R-Texas), Kevin Cramer (R-N.D.), Ted Cruz (R-Texas), Steve Daines (R-Mont.), Lindsey Graham (R-S.C.), Bill Hagerty (R-Tenn.), Jim Justice (R-W.Va.), John Kennedy (R-La.), Mike Lee (R-Utah), Cynthia Lummis (R-Wyo.), Roger Marshall (R-Kan.), Ashley Moody (R-Fla.), Bernie Moreno (R-Ohio), Eric Schmitt (R-Mo.) Thom Tillis (R-N.C.) and Tommy Tuberville (R-Ala.).

Tyler Durden Tue, 04/01/2025 - 08:05

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