Zero Hedge

US Insurers Are Refusing To Cover Climate-Change Risk-Zones

US Insurers Are Refusing To Cover Climate-Change Risk-Zones

Authored by Felicity Bradstock via OilPrice.com,

  • U.S. insurers are rapidly pulling coverage from homes in high-risk climate zones, particularly in California, Florida, and North Carolina.

  • Millions of homeowners are facing nonrenewals, impacting their ability to secure mortgages and causing housing market instability.

  • Government and local efforts are underway to mitigate risks and persuade insurers to continue coverage, but significant gaps remain.

As countries worldwide experience more regular extreme weather events, insurers have become more reluctant to cover properties in high-risk areas. However, without insurance, it is impossible for many people to gain access to mortgage financing. We are seeing an insurance crisis in the United States, as insurers are becoming less likely to offer coverage for homes in certain areas, particularly those that have experienced natural disasters, such as flooding and wildfire, in recent years. 

Between 2018 and December 2024, over 1.9 million home insurance contracts were “nonrenewed”, meaning they came to an end. The nonrenewal rate tripled or more in over 200 U.S. counties, according to a congressional report. These figures became clear following an investigation spurred by the Senate Budget Committee, which demanded in November 2023 that the largest U.S. insurance companies provide the number of nonrenewals by county and year.

Some states and cities are seeing greater nonrenewal rates than others, particularly those at greater risk of fire, flood, hurricanes and other severe weather events. Although there is still a lack of information on the reason behind the nonrenewals, the countrywide map of nonrenewals strongly reflects the climate crisis as it is being seen across the U.S. Some of the areas most affected include California, Florida, and North Carolina.

Following the publication of the report, Senator Sheldon Whitehouse said, “The climate crisis that is coming our way is not just about polar bears, and it’s not just about green jobs.”

Whitehouse added, “It actually is coming through your mail slot, in the form of insurance cancellations, insurance nonrenewals and dramatic increases in insurance costs.”

According to the National Oceanic and Atmospheric Administration, in 2024, there were 27 individual weather and climate disasters, coming only behind the record-setting 28 events in 2023. Last year was the fourth-costliest year on record in terms of these types of events, with a total cost of approximately $182.7 billion, coming after 2017 ($395.9 billion), 2005 ($268.5 billion), and 2022 ($183.6 billion). The 2024 weather events included storms, wildfires, droughts, flooding, tornadoes, tropical cyclones and other types of extreme weather. 

In addition to considering which areas are “high risk”, insurers also assess the building materials used for construction. Many mobile or manufactured homes are not covered by insurers. Companies may also impose restrictions on houses constructed out of wood and other fire-prone materials. However, even states with strict building codes are seeing more coverage denials. In California, which has strict building codes to mitigate wildfire risk, insurers have been increasingly rejecting requests for coverage. In certain counties, nonrenewal rates have risen by over 500 percent since 2018. 

The government has started to respond to the problem in some areas of the country. For example, in December, officials announced that they would make it easier for insurers to increase rates, but in exchange, they must agree to continue insuring consumers in fire-prone areas. Other state and local governments are carrying out prescribed burns in residential areas, as well as clearing vegetation close to houses, to reduce the risk of wildfire spread in these areas. 

Some companies have halted new insurance policies in certain parts of the country, such as AllState. In 2022, AllState paused the sale of new home and condo insurance policies in California. A spokesperson for the firm stated, “Our payments to help California residents recover from accidents and disasters have increased significantly in recent years due to higher repair costs and more frequent and severe weather… We continue to offer coverage to most existing home insurance customers.” 

State Farm, one of the biggest insurance providers in the U.S., followed suit in 2023 by halting the sale of new housing insurance products in California. In Florida, by the spring of 2024, at least 12 insurance companies had stopped selling housing insurance in the state. Farmers Insurance stated upon withdrawing from Florida, “This business decision was necessary to effectively manage risk exposure.”

A 2024 report by the non-profit First Street Foundation, showed that 23.9 million properties in the U.S. were at risk from damaging winds, 4.4 million properties were at risk from wildfire, and a further 12 million properties were at significant risk of flooding – in addition to properties in the Federal Emergency Management Agency (Fema)'s Special Flood Hazard Areas. The report stated, “Private insurance companies are effectively labelling areas as uninsurable.”

The result of the withdrawal of insurance companies from certain parts of the country is the inability for consumers to get a mortgage, meaning fewer people can buy a house. As houses sit empty, it drives down property prices in the area and leads to less tax revenue being collected to invest in services. Many communities are facing these consequences and feel left behind.

If the U.S. government does not take action to mitigate the risk of the impact of extreme weather events in these areas or encourage insurers to continue covering high-risk areas, this will happen to a greater number of communities across the country.

Tyler Durden Mon, 07/07/2025 - 17:00

Cotati Man Gets DUI After 70 Empty Bud Light Cans Found In His Car

Cotati Man Gets DUI After 70 Empty Bud Light Cans Found In His Car

We're not really sure you can call it a "suspected" DUI at this point...

But that's how it was reported when a driver in California was taken into custody for DUI after failing a field sobriety test and being found with dozens of empty beer cans in his vehicle, according to police.

The Cotati Police Department said officers pulled the driver over on Sunday night after noticing he was “struggling to maintain their travel plans” , according to KBTX.

During the stop, they spotted an open alcohol container in the vehicle’s cupholder.

KBTX reported that following a field sobriety evaluation, officers determined the driver’s blood alcohol content was more than three times the legal limit. He was arrested for driving under the influence and for operating a vehicle with a suspended license — a suspension stemming from a previous DUI offense.

During a subsequent search of the SUV, authorities allegedly discovered “more than 70 empty Bud Light cans,” according to the department.

“We want to remind everyone that drinking and driving is not worth it! The outcome could have been much worse had our officers not stopped the driver,” the Cotati Police Department stated.

Tyler Durden Mon, 07/07/2025 - 16:40

"Who Knows What To Believe These Days..."

"Who Knows What To Believe These Days..."

Authored by James Howard Kunstler,

Cage Match!

“...[W}e are closing in on more disclosures and fixing past wrongs to personnel. We’re making sure this is done correctly. But it’s absolutely getting done.”

 - Dan Bongino, Deputy Director, FBI

Who knows what to believe these days? Well, what would you expect after years, even decades, of anti-reality operations by everyone from the CIA to The New York Times to Harvard U. Is it any wonder that reality-optionality is making the people both apathetic and insane?

We are told now by the FBI that there is no evidence that Jeffrey Epstein ran a blackmail operation against the politicos of Western Civ, or that a “client list” existed, or that JE was murdered in his jail cell. It well might be true that there is no evidence, strictly speaking.

Messrs. Patel and Bongino, coming into office rather late in the Epstein game, were apparently left with big bag of nuthin. What else can they truthfully report? So, they had to put it out there, knowing a whole lot of people would be miffed. “We’ve got nuthin, sorry.” Were they chagrined to do that? Evidently so. Of course, this Epstein business has been going on for years and years and it is certainly possible that the most damning evidence has been destroyed by interested parties.

Personally, I find it implausible that absolutely nothing ever leaked, no video of, say, Tony Blair or Bill Clinton violating a child, if it ever happened. Everything else in our world leaks, eventually. And there were supposedly how many cameras around the Epstein properties, and how many thousands of hours of video recordings? There is more video of Bigfoot than of compromised Epstein bigshots. Just sayin’.

AG Pam Bondi, the FBIs boss, also has some ‘splainin’ to do. In February, she claimed to have the Epstein client list “sitting on my desk right now to review,” and hinted it would be released shortly. That material, when released, turned out to be the old dog-eared flight logs that have been circulating through every news outlet for years. Did she not know the difference between an alleged “client list” and the old flight logs? Let’s face it: seems kind of dumb. . . seems like the AG got played. . . and now the mob on “X” is having sport with her.

Among the miffed, apparently, is Elon Musk. At the height of his feud with Mr. Trump, on June 5, Elon put out a message on his “X” platform saying, "@realDonaldTrump is in the Epstein files. That is the real reason they have not been made public. Have a nice day, DJT!". This intemperate utterance naturally prompts you to wonder: how (or what) might Elon know about any supposed Epstein evidence? At this point, the FBI might send somebody to inquire. Did Elon, who has more money than even Scrooge McDuck, somehow manage to buy up all those alleged blackmail tapes? Does he otherwise know where they might have disappeared to? Has he ever seen anything? Anyway, he didn’t produce any actual evidence.

Is Elon losing it, a little bit. His grip, that is. Mr. Trump thinks so. He declared over the weekend that Elon has “gone off the rails” . . . has become “a train wreck.” Well, what you can see in this very public, very regrettable cage-match between two giant public personalities is that Elon has lost his cool and the president has not.

For one thing, Elon is apparently incensed over the One Big Beautiful Bill (OBBB) just signed into law because it ends the electric vehicle mandate left over from the “Joe Biden” regime, as well as the whopping $7,500 federal tax credit for new electric cars — loss of which which is apt to break Tesla’s business model. The bill also calls for sunsetting subsidies for battery production by 2028, meaning Tesla’s Powerwall business is likewise affected. Mr. Trump took pains to explain that he’d informed Elon from the get-go (and repeatedly) that all those subsidies were done for when he got elected.

Elon was visibly perturbed over the process that produced the OBBB, the proverbial political sausage-making (i.e., a nasty business you’d be appalled to watch). It appeared, he said, to un-do all of his DOGE spending cuts so laboriously made. Mainly, Elon deplored the failure to address the $36-trillion-plus national debt, widely recognized as a time-bomb on a short fuse liable to sink the whole USS United States. I will tell you a harsh truth: nobody will do anything about the national debt. The sheer math of our annual debt service is simply impossible. Our country is heading into some sort of bankruptcy proceeding, some kind of ferocious “work out” — as they say in the banking board-rooms.

Mr. Trump is betting that re-industrialization of the USA will produce enough of the right sort of growth — that is, production of real things of real value, as opposed to mere financial shenanigans — that the debt reckoning can be overcome somehow. Or mitigated. It’s a bold risk, and many pieces of the scheme are indeed falling into place: tariffs, bigly investment capital from foreigners, a general realignment of trade relations, tax reform, downsizing of government.

But a virulent opposition, the mad-dog remnants of the Democratic Party, seeks to wreck Mr. Trump’s program (and perhaps the USA altogether), and it is a miracle that the president has gotten this far with his plan. Personally, I’m doubtful that the energy resources will be there to underwrite this reindustrialization, but that is a topic for another day.

And now Elon, peeved as he is, proposes to bring another big obstacle onto the scene, his proposed new “American Party.” Looks like he is making a tactical blunder, and his distraught emotional demeanor suggests poor decision-making. Frankly, I’ve been concerned about Elon’s soundness-of-mind since he came on-board Mr. Trump’s band-wagon last summer. There was something peculiar about his spastic rompings on stage, his jerky movements, his garbly speeches. You wonder if all the talk about his world-beating “genius” has messed with his mind.

Also, frankly, I’ve long thought that attempting to colonize Mars was absurd, or at least premature. Shouldn’t we rather make an effort to demonstrate that we can live on this planet successfully before we venture off to a new one? After all, this Earth is perfectly suited to our needs and Mars is absolutely not. I doubt that even the most extreme transhuman program would avail to implant us up there.

To cut to the chase: the grandiosity of Elon’s plans, and the oddness of his public performances, suggests to me that he has gone a bit crazy in the pure sense of the word.

This new party he proposes looks like a crazy play by a crazy person. He can throw zillions of dollars into it, and create a whole lot of political mischief, but what would that prove?

How would that make him any better than such obvious villains as George Soros and Bill Gates?

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

Tyler Durden Mon, 07/07/2025 - 16:20

"Who Knows What To Believe These Days..."

"Who Knows What To Believe These Days..."

Authored by James Howard Kunstler,

Cage Match!

“...[W}e are closing in on more disclosures and fixing past wrongs to personnel. We’re making sure this is done correctly. But it’s absolutely getting done.”

 - Dan Bongino, Deputy Director, FBI

Who knows what to believe these days? Well, what would you expect after years, even decades, of anti-reality operations by everyone from the CIA to The New York Times to Harvard U. Is it any wonder that reality-optionality is making the people both apathetic and insane?

We are told now by the FBI that there is no evidence that Jeffrey Epstein ran a blackmail operation against the politicos of Western Civ, or that a “client list” existed, or that JE was murdered in his jail cell. It well might be true that there is no evidence, strictly speaking.

Messrs. Patel and Bongino, coming into office rather late in the Epstein game, were apparently left with big bag of nuthin. What else can they truthfully report? So, they had to put it out there, knowing a whole lot of people would be miffed. “We’ve got nuthin, sorry.” Were they chagrined to do that? Evidently so. Of course, this Epstein business has been going on for years and years and it is certainly possible that the most damning evidence has been destroyed by interested parties.

Personally, I find it implausible that absolutely nothing ever leaked, no video of, say, Tony Blair or Bill Clinton violating a child, if it ever happened. Everything else in our world leaks, eventually. And there were supposedly how many cameras around the Epstein properties, and how many thousands of hours of video recordings? There is more video of Bigfoot than of compromised Epstein bigshots. Just sayin’.

AG Pam Bondi, the FBIs boss, also has some ‘splainin’ to do. In February, she claimed to have the Epstein client list “sitting on my desk right now to review,” and hinted it would be released shortly. That material, when released, turned out to be the old dog-eared flight logs that have been circulating through every news outlet for years. Did she not know the difference between an alleged “client list” and the old flight logs? Let’s face it: seems kind of dumb. . . seems like the AG got played. . . and now the mob on “X” is having sport with her.

Among the miffed, apparently, is Elon Musk. At the height of his feud with Mr. Trump, on June 5, Elon put out a message on his “X” platform saying, "@realDonaldTrump is in the Epstein files. That is the real reason they have not been made public. Have a nice day, DJT!". This intemperate utterance naturally prompts you to wonder: how (or what) might Elon know about any supposed Epstein evidence? At this point, the FBI might send somebody to inquire. Did Elon, who has more money than even Scrooge McDuck, somehow manage to buy up all those alleged blackmail tapes? Does he otherwise know where they might have disappeared to? Has he ever seen anything? Anyway, he didn’t produce any actual evidence.

Is Elon losing it, a little bit. His grip, that is. Mr. Trump thinks so. He declared over the weekend that Elon has “gone off the rails” . . . has become “a train wreck.” Well, what you can see in this very public, very regrettable cage-match between two giant public personalities is that Elon has lost his cool and the president has not.

For one thing, Elon is apparently incensed over the One Big Beautiful Bill (OBBB) just signed into law because it ends the electric vehicle mandate left over from the “Joe Biden” regime, as well as the whopping $7,500 federal tax credit for new electric cars — loss of which which is apt to break Tesla’s business model. The bill also calls for sunsetting subsidies for battery production by 2028, meaning Tesla’s Powerwall business is likewise affected. Mr. Trump took pains to explain that he’d informed Elon from the get-go (and repeatedly) that all those subsidies were done for when he got elected.

Elon was visibly perturbed over the process that produced the OBBB, the proverbial political sausage-making (i.e., a nasty business you’d be appalled to watch). It appeared, he said, to un-do all of his DOGE spending cuts so laboriously made. Mainly, Elon deplored the failure to address the $36-trillion-plus national debt, widely recognized as a time-bomb on a short fuse liable to sink the whole USS United States. I will tell you a harsh truth: nobody will do anything about the national debt. The sheer math of our annual debt service is simply impossible. Our country is heading into some sort of bankruptcy proceeding, some kind of ferocious “work out” — as they say in the banking board-rooms.

Mr. Trump is betting that re-industrialization of the USA will produce enough of the right sort of growth — that is, production of real things of real value, as opposed to mere financial shenanigans — that the debt reckoning can be overcome somehow. Or mitigated. It’s a bold risk, and many pieces of the scheme are indeed falling into place: tariffs, bigly investment capital from foreigners, a general realignment of trade relations, tax reform, downsizing of government.

But a virulent opposition, the mad-dog remnants of the Democratic Party, seeks to wreck Mr. Trump’s program (and perhaps the USA altogether), and it is a miracle that the president has gotten this far with his plan. Personally, I’m doubtful that the energy resources will be there to underwrite this reindustrialization, but that is a topic for another day.

And now Elon, peeved as he is, proposes to bring another big obstacle onto the scene, his proposed new “American Party.” Looks like he is making a tactical blunder, and his distraught emotional demeanor suggests poor decision-making. Frankly, I’ve been concerned about Elon’s soundness-of-mind since he came on-board Mr. Trump’s band-wagon last summer. There was something peculiar about his spastic rompings on stage, his jerky movements, his garbly speeches. You wonder if all the talk about his world-beating “genius” has messed with his mind.

Also, frankly, I’ve long thought that attempting to colonize Mars was absurd, or at least premature. Shouldn’t we rather make an effort to demonstrate that we can live on this planet successfully before we venture off to a new one? After all, this Earth is perfectly suited to our needs and Mars is absolutely not. I doubt that even the most extreme transhuman program would avail to implant us up there.

To cut to the chase: the grandiosity of Elon’s plans, and the oddness of his public performances, suggests to me that he has gone a bit crazy in the pure sense of the word.

This new party he proposes looks like a crazy play by a crazy person. He can throw zillions of dollars into it, and create a whole lot of political mischief, but what would that prove?

How would that make him any better than such obvious villains as George Soros and Bill Gates?

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

Tyler Durden Mon, 07/07/2025 - 16:20

'Never Let A Crisis Go To Waste': Press & Pundits Push False Story On Trump Cuts Causing Texas Tragedy

'Never Let A Crisis Go To Waste': Press & Pundits Push False Story On Trump Cuts Causing Texas Tragedy

Authored by Jonathan Turley,

Democratic strategist and former Obama chief of staff Rahm Emanuel once stated that “You never want a serious crisis to go to waste.”

That philosophy seemed to be the playbook for the media and pundits immediately after the flood in Texas as many rushed to claim that it was caused by Trump budget cuts to the National Weather Service (NWS).

From George Stephanopoulos to Rosie O’Donnell, the hoax was spread that there was an understaffing at the NWS that may have caused these deaths.

It did not matter that it was an easy matter to confirm or that the underlying claims of understaffing the NWS team were false.

The weaponization of such tragedies has become commonplace in American politics.

Previously, Democrats like Senate Minority Leader Sen. Chuck Schumer bizarrely attempted to blame the crash of a Mexican ship in New York and air accidents around the world on Trump cuts.There are legitimate reasons to question whether cuts to agencies like the NWS might impact key programs, such as weather warning systems. There are also questions about whether long-standing forecast modeling failed to capture the severity of this particularly storm. However, basic honesty and decency would demand a modicum of inquiry before blaming the NWS for a failure that caused mass deaths, including a large number of children.

Indeed, the rush to claim that the tragedy was caused by understaffing can make it more difficult to find any real failures in the system. It is also possible that this was a convergence of weather systems that happened so fast (and late at night) that few citizens could take meaningful action. Some reports indicate that the river rose by 20 feet in only 45 minutes.Nevertheless, many rushed to take political advantage of the tragedy. Grant Stern, the executive editor of Occupy Democrats wrote on X “It only took 9 days for Trump’s cuts to the [National Oceanic and Atmospheric Administration] to kill dozens of children in Texas when Tropical Storm Barry landed this week.”

In reality, the NWS had extra personnel working the storm and issued the first warning 12 hours before the flood.

Moreover, even assuming that the cuts to the NWS might impact warning systems, they are not even scheduled to take effect until next year. While there were retirements and resignations early in the Trump Administration, there is no evidence that those departures are impacting weather warnings, let alone this emergency.

However, the media pounced as the death toll rose. Even after the Administration refuted the false claims, they were still being promulgated by the press. On ABC’s This Week George Stephanopoulos ominously declared “We’re also learning there were significant staffing shortfalls to the National Weather Services offices in the region.”

Whatever “shortfalls” are being reported “in the region”, they did not appear to impact the early warning given 12 hours earlier or the fact that there were extra, not fewer, staffers working the storm.

Again, none of this mattered. Politicians and pundits, such as Hakeem Jeffries and Adam Kinzinger, joined the chorus to suggest that cuts would make this a repeated failure.

Rep. Joaquin Castro (D-Texas) told CNN Sunday the NWS should be investigated. “I don’t think it’s helpful to have missing key personnel from the National Weather Service not in place to help prevent these tragedies.”

As parents mourned dead children, commentators rushed to lay the losses at the feet of the Administration. Ron Filipkowski, the editor-in-chief of MediasTouchNews, wrote “The people in Texas voted for government services controlled by Donald Trump and Greg Abbott. That is exactly what they (sic) getting.”

Rachel Bitecofer, assistant director at Christopher Newport University’s Wason Center for Public Policy declared “What has happened to the girls at Camp Mystic is EXACTLY what one of the country’s best meteorologists, John Morales, warned would happen. Trump’s cuts to the NOAA & NWS have critically impacted storm prediction nationwide.”

Rosie O’Donnell, who famously fled the United States for the safety of Ireland after the election, added to the false narrative:

“What a horror story in Texas. When the president guts all of the early warning systems and the weathering forecast abilities of the government, these are the results that we’re going to start to see on a daily basis.”

There are obvious familiar aspects to the news coverage.

It takes very little for the media to seed a false, viral story. It quickly enters the echo chamber and is repeated on countless social media sites.

When it is finally debunked, the media just shrugs and walks away.

Whether it was the false story about agents whipping migrants in Texas or the photo op claim in Lafayette Park, false stories were disproven only to have a collective shrug from those who spread them.

Heading into the presidential debate, the White House and the media attacked Fox News and other outlets for “cheap fake” videos designed to make the President look confused and feeble. For months, politicians and pundits insisted that Biden was sharp and commanding in conversations even after Special Counsel Robert Hur cited his decline as a reason for not charging him criminally.

On MSNBC, Joe Scarborough stated “start your tape right now because I’m about to tell you the truth. And F— you if you can’t handle the truth. This version of Biden intellectually, analytically, is the best Biden ever. Not a close second. And I have known him for years…If it weren’t the truth I wouldn’t say it.”

When the truth came out after the election loss, reporters ran around claiming that they were shocked by the fact that Biden was indeed mentally and physically diminished. By that point, it did not matter. Biden was out and the truth could be reported in a slew of belated books and articles.

Yet, some media outlets have refused to acknowledge false stories even after they were debunked. At the Washington Post, columnist Philip Bump previously had a meltdown in an interview when confronted about past false claims. After I wrote a column about the litany of such false claims, the Post surprised many of us by issuing a statement that it stood by all of Bump’s reporting, including false columns on the Lafayette Park protests, Hunter Biden’s laptop, and other stories. That was long after other media debunked the claims, but the Post stood by the false reporting.

Many media outlets pushed such stories because they knew that their readers want the claims to be true — and will not be outraged (or even convinced) when the stories are later debunked. Notably, when the New York Times recently ran a confirmed story that was negative for the Democratic mayoral nominee in New York, liberal readers and pundits were outraged.

Once again, we need to see what went wrong in Texas to try to avoid such tragedies in the future. However, the NWS appears to have done its job with adding extra staff and reportedly issuing the first warnings 12 hours in advance.  We need to look at precisely when those warnings were issued during the critical period and what information they conveyed. The hair-triggered response of the media to weaponize the tragedy should also be reviewed.

However, it is far more likely that there will be changes to emergency procedures than any serious change to journalistic practices.

Tyler Durden Mon, 07/07/2025 - 15:45

'Never Let A Crisis Go To Waste': Press & Pundits Push False Story On Trump Cuts Causing Texas Tragedy

'Never Let A Crisis Go To Waste': Press & Pundits Push False Story On Trump Cuts Causing Texas Tragedy

Authored by Jonathan Turley,

Democratic strategist and former Obama chief of staff Rahm Emanuel once stated that “You never want a serious crisis to go to waste.”

That philosophy seemed to be the playbook for the media and pundits immediately after the flood in Texas as many rushed to claim that it was caused by Trump budget cuts to the National Weather Service (NWS).

From George Stephanopoulos to Rosie O’Donnell, the hoax was spread that there was an understaffing at the NWS that may have caused these deaths.

It did not matter that it was an easy matter to confirm or that the underlying claims of understaffing the NWS team were false.

The weaponization of such tragedies has become commonplace in American politics.

Previously, Democrats like Senate Minority Leader Sen. Chuck Schumer bizarrely attempted to blame the crash of a Mexican ship in New York and air accidents around the world on Trump cuts.There are legitimate reasons to question whether cuts to agencies like the NWS might impact key programs, such as weather warning systems. There are also questions about whether long-standing forecast modeling failed to capture the severity of this particularly storm. However, basic honesty and decency would demand a modicum of inquiry before blaming the NWS for a failure that caused mass deaths, including a large number of children.

Indeed, the rush to claim that the tragedy was caused by understaffing can make it more difficult to find any real failures in the system. It is also possible that this was a convergence of weather systems that happened so fast (and late at night) that few citizens could take meaningful action. Some reports indicate that the river rose by 20 feet in only 45 minutes.Nevertheless, many rushed to take political advantage of the tragedy. Grant Stern, the executive editor of Occupy Democrats wrote on X “It only took 9 days for Trump’s cuts to the [National Oceanic and Atmospheric Administration] to kill dozens of children in Texas when Tropical Storm Barry landed this week.”

In reality, the NWS had extra personnel working the storm and issued the first warning 12 hours before the flood.

Moreover, even assuming that the cuts to the NWS might impact warning systems, they are not even scheduled to take effect until next year. While there were retirements and resignations early in the Trump Administration, there is no evidence that those departures are impacting weather warnings, let alone this emergency.

However, the media pounced as the death toll rose. Even after the Administration refuted the false claims, they were still being promulgated by the press. On ABC’s This Week George Stephanopoulos ominously declared “We’re also learning there were significant staffing shortfalls to the National Weather Services offices in the region.”

Whatever “shortfalls” are being reported “in the region”, they did not appear to impact the early warning given 12 hours earlier or the fact that there were extra, not fewer, staffers working the storm.

Again, none of this mattered. Politicians and pundits, such as Hakeem Jeffries and Adam Kinzinger, joined the chorus to suggest that cuts would make this a repeated failure.

Rep. Joaquin Castro (D-Texas) told CNN Sunday the NWS should be investigated. “I don’t think it’s helpful to have missing key personnel from the National Weather Service not in place to help prevent these tragedies.”

As parents mourned dead children, commentators rushed to lay the losses at the feet of the Administration. Ron Filipkowski, the editor-in-chief of MediasTouchNews, wrote “The people in Texas voted for government services controlled by Donald Trump and Greg Abbott. That is exactly what they (sic) getting.”

Rachel Bitecofer, assistant director at Christopher Newport University’s Wason Center for Public Policy declared “What has happened to the girls at Camp Mystic is EXACTLY what one of the country’s best meteorologists, John Morales, warned would happen. Trump’s cuts to the NOAA & NWS have critically impacted storm prediction nationwide.”

Rosie O’Donnell, who famously fled the United States for the safety of Ireland after the election, added to the false narrative:

“What a horror story in Texas. When the president guts all of the early warning systems and the weathering forecast abilities of the government, these are the results that we’re going to start to see on a daily basis.”

There are obvious familiar aspects to the news coverage.

It takes very little for the media to seed a false, viral story. It quickly enters the echo chamber and is repeated on countless social media sites.

When it is finally debunked, the media just shrugs and walks away.

Whether it was the false story about agents whipping migrants in Texas or the photo op claim in Lafayette Park, false stories were disproven only to have a collective shrug from those who spread them.

Heading into the presidential debate, the White House and the media attacked Fox News and other outlets for “cheap fake” videos designed to make the President look confused and feeble. For months, politicians and pundits insisted that Biden was sharp and commanding in conversations even after Special Counsel Robert Hur cited his decline as a reason for not charging him criminally.

On MSNBC, Joe Scarborough stated “start your tape right now because I’m about to tell you the truth. And F— you if you can’t handle the truth. This version of Biden intellectually, analytically, is the best Biden ever. Not a close second. And I have known him for years…If it weren’t the truth I wouldn’t say it.”

When the truth came out after the election loss, reporters ran around claiming that they were shocked by the fact that Biden was indeed mentally and physically diminished. By that point, it did not matter. Biden was out and the truth could be reported in a slew of belated books and articles.

Yet, some media outlets have refused to acknowledge false stories even after they were debunked. At the Washington Post, columnist Philip Bump previously had a meltdown in an interview when confronted about past false claims. After I wrote a column about the litany of such false claims, the Post surprised many of us by issuing a statement that it stood by all of Bump’s reporting, including false columns on the Lafayette Park protests, Hunter Biden’s laptop, and other stories. That was long after other media debunked the claims, but the Post stood by the false reporting.

Many media outlets pushed such stories because they knew that their readers want the claims to be true — and will not be outraged (or even convinced) when the stories are later debunked. Notably, when the New York Times recently ran a confirmed story that was negative for the Democratic mayoral nominee in New York, liberal readers and pundits were outraged.

Once again, we need to see what went wrong in Texas to try to avoid such tragedies in the future. However, the NWS appears to have done its job with adding extra staff and reportedly issuing the first warnings 12 hours in advance.  We need to look at precisely when those warnings were issued during the critical period and what information they conveyed. The hair-triggered response of the media to weaponize the tragedy should also be reviewed.

However, it is far more likely that there will be changes to emergency procedures than any serious change to journalistic practices.

Tyler Durden Mon, 07/07/2025 - 15:45

US Ends Foreign Terror Designation On Syria's HTS, Nearly 2 Months AFTER Trump Met Its Leader

US Ends Foreign Terror Designation On Syria's HTS, Nearly 2 Months AFTER Trump Met Its Leader

The United States announced Monday that has formally revoked the foreign terrorist organization designation for Syria's ruling Hay'at Tahrir al-Sham (HTS) group, ironically coming nearly two months after President Trump met with its leader, Syria's self-declared interim president, Ahmad al-Sharaa (formerly Abu Mohammad al-Jolani).

It's not just ironic, but scandalous, that Trump met with a US-designated terrorist during this Gulf tour while in Saudi Arabia. If any individual American citizen did the same, they would likely be investigated and prosecuted by the FBI. But Sharaa is the "former" al-Qaeda in Syria man who helped overthrow Bashar al-Assad, and that's apparently all that Washington cares about.

The newly published State Department memo, signed by Secretary of State Marco Rubio, reads as follows: "In consultation with the Attorney General and the Secretary of the Treasury, I hereby revoke the designation of al-Nusra Front, also known as Hay'at Tahrir al-Sham."

The memo is actually dated to June 23, but has gone into effect at the time of publication.

Recall that Trump had gone so far as to praise al-Sharaa as a "young, attractive guy" who has a "real shot at doing a good job". There was no mention at the time of protecting some of the world's most ancient churches and Syria's sizeable Christian community.

The fruit of that 'good job' thus far has been a genocidal campaign launched against Alawites near Latakia, as well as attacks on churches, including last month's suicide bombing of St. Elias Orthodox Church in Damascus, which left at least 25 people - including children - dead. A group affiliated with Hayat Tahrir al-Sham actually took responsibility. 

Why aren't Christian leaders in the West more vocal about the plight of Syria's blood-soaked churches?

Not only has Trump dropped sanctions on post-Assad Syria, but is even encouraging historic rapprochement and normalization with Israel:

Since assuming power, Sharaa has admitted that his government is holding "indirect talks" with Israel, and last week, Syrian authorities said they were willing to cooperate with Washington on reimplementing a 1974 disengagement agreement with Israel. 

Speaking earlier on Monday, the US special envoy to Syria and Lebanon, Tom Barrack, said "dialogue has started" between the two countries. 

Sharaa is likely to face opposition from his base and the broader Syrian population over a possible normalization deal, as Israel continues to wage war on hungry and besieged Palestinians in Gaza.

Sadly, the message from the White House seems to be that Syria should prioritize ending the long-running state of conflict with Israel, but there's been barely a peep about the massacres being conducted against Syria's ancient Christian, Alawite, and Druze populations.

But this was all about the US-Gulf-Israeli push for regime change, and Jolani is now their #1 terrorist 'man in Damascus'. Assad and the Syrian Army ultimately lost the proxy war which was waged since 2011, with billions of dollars sunk into the effort from the Gulf and Western alliance.

Tyler Durden Mon, 07/07/2025 - 15:25

US Ends Foreign Terror Designation On Syria's HTS, Nearly 2 Months AFTER Trump Met Its Leader

US Ends Foreign Terror Designation On Syria's HTS, Nearly 2 Months AFTER Trump Met Its Leader

The United States announced Monday that has formally revoked the foreign terrorist organization designation for Syria's ruling Hay'at Tahrir al-Sham (HTS) group, ironically coming nearly two months after President Trump met with its leader, Syria's self-declared interim president, Ahmad al-Sharaa (formerly Abu Mohammad al-Jolani).

It's not just ironic, but scandalous, that Trump met with a US-designated terrorist during this Gulf tour while in Saudi Arabia. If any individual American citizen did the same, they would likely be investigated and prosecuted by the FBI. But Sharaa is the "former" al-Qaeda in Syria man who helped overthrow Bashar al-Assad, and that's apparently all that Washington cares about.

The newly published State Department memo, signed by Secretary of State Marco Rubio, reads as follows: "In consultation with the Attorney General and the Secretary of the Treasury, I hereby revoke the designation of al-Nusra Front, also known as Hay'at Tahrir al-Sham."

The memo is actually dated to June 23, but has gone into effect at the time of publication.

Recall that Trump had gone so far as to praise al-Sharaa as a "young, attractive guy" who has a "real shot at doing a good job". There was no mention at the time of protecting some of the world's most ancient churches and Syria's sizeable Christian community.

The fruit of that 'good job' thus far has been a genocidal campaign launched against Alawites near Latakia, as well as attacks on churches, including last month's suicide bombing of St. Elias Orthodox Church in Damascus, which left at least 25 people - including children - dead. A group affiliated with Hayat Tahrir al-Sham actually took responsibility. 

Why aren't Christian leaders in the West more vocal about the plight of Syria's blood-soaked churches?

Not only has Trump dropped sanctions on post-Assad Syria, but is even encouraging historic rapprochement and normalization with Israel:

Since assuming power, Sharaa has admitted that his government is holding "indirect talks" with Israel, and last week, Syrian authorities said they were willing to cooperate with Washington on reimplementing a 1974 disengagement agreement with Israel. 

Speaking earlier on Monday, the US special envoy to Syria and Lebanon, Tom Barrack, said "dialogue has started" between the two countries. 

Sharaa is likely to face opposition from his base and the broader Syrian population over a possible normalization deal, as Israel continues to wage war on hungry and besieged Palestinians in Gaza.

Sadly, the message from the White House seems to be that Syria should prioritize ending the long-running state of conflict with Israel, but there's been barely a peep about the massacres being conducted against Syria's ancient Christian, Alawite, and Druze populations.

But this was all about the US-Gulf-Israeli push for regime change, and Jolani is now their #1 terrorist 'man in Damascus'. Assad and the Syrian Army ultimately lost the proxy war which was waged since 2011, with billions of dollars sunk into the effort from the Gulf and Western alliance.

Tyler Durden Mon, 07/07/2025 - 15:25

Goldman Sachs Expects Another OPEC+ Superhike In September

Goldman Sachs Expects Another OPEC+ Superhike In September

Authored by Tsvetana Paraskova via OilPrice.com,

The OPEC+ producers are expected in August to agree on another superhike in production for September that would complete the unwinding of the 2.2 million barrels per day (bpd) output cuts, Goldman Sachs said after the alliance surprised the market with a larger-than-forecast boost for August.

The OPEC+ group is set to unwind the last 550,000 bpd of the 2.2-million-bpd cut in September, the investment bank said in a weekend note.

On Saturday, the eight OPEC+ producers withholding supply to the market decided to ramp up oil production more aggressively than anticipated in August.

At the virtual meeting Saturday, the eight core members led by Saudi Arabia agreed to add 548,000 bpd to global supply—exceeding earlier expectations of a 411,000 bpd hike. The move sets the bloc on track to fully unwind 2.2 million bpd of prior cuts nearly a year ahead of schedule.

“Saturday's announcement to accelerate supply hikes increases our confidence that the shift, which we started flagging last summer, to a more long-run equilibrium focused on normalizing spare capacity and market share, supporting internal cohesion, and strategically disciplining US shale supply, is continuing,” Goldman Sachs analysts wrote in a note carried by Reuters.

Saudi Arabia, Russia, Iraq, UAE, Kuwait, Kazakhstan, Algeria, and Oman cited “current healthy oil market fundamentals and steady global economic outlook”, as well as “low oil inventories”, for their decision to boost August production by more than previously expected.

The decision reflects short-term bullish fundamentals for this summer.

The superhike also reaffirms OPEC’s major pivot from defending oil prices to boosting output and market share for producers such as Saudi Arabia that have stuck to their quotas, and punishing producers that have overproduced and now have to forego most of their share of the production hike.

Of these overproducers, Iraq and Russia appear to be trying to fall in line, but Kazakhstan continues to defy OPEC+ and pumps hundreds of thousands of barrels per day above its output ceiling, citing its inability to force foreign oil majors to cut production from new projects.

The actual production increase from OPEC+ will be lower than the headline figure suggests, due to compensations for previous overproduction.

Nevertheless, the superhike in August – and possibly in September – would accelerate the market glut after peak summer demand starts to wane in the autumn and winter, analysts say.

Tyler Durden Mon, 07/07/2025 - 15:05

Goldman Sachs Expects Another OPEC+ Superhike In September

Goldman Sachs Expects Another OPEC+ Superhike In September

Authored by Tsvetana Paraskova via OilPrice.com,

The OPEC+ producers are expected in August to agree on another superhike in production for September that would complete the unwinding of the 2.2 million barrels per day (bpd) output cuts, Goldman Sachs said after the alliance surprised the market with a larger-than-forecast boost for August.

The OPEC+ group is set to unwind the last 550,000 bpd of the 2.2-million-bpd cut in September, the investment bank said in a weekend note.

On Saturday, the eight OPEC+ producers withholding supply to the market decided to ramp up oil production more aggressively than anticipated in August.

At the virtual meeting Saturday, the eight core members led by Saudi Arabia agreed to add 548,000 bpd to global supply—exceeding earlier expectations of a 411,000 bpd hike. The move sets the bloc on track to fully unwind 2.2 million bpd of prior cuts nearly a year ahead of schedule.

“Saturday's announcement to accelerate supply hikes increases our confidence that the shift, which we started flagging last summer, to a more long-run equilibrium focused on normalizing spare capacity and market share, supporting internal cohesion, and strategically disciplining US shale supply, is continuing,” Goldman Sachs analysts wrote in a note carried by Reuters.

Saudi Arabia, Russia, Iraq, UAE, Kuwait, Kazakhstan, Algeria, and Oman cited “current healthy oil market fundamentals and steady global economic outlook”, as well as “low oil inventories”, for their decision to boost August production by more than previously expected.

The decision reflects short-term bullish fundamentals for this summer.

The superhike also reaffirms OPEC’s major pivot from defending oil prices to boosting output and market share for producers such as Saudi Arabia that have stuck to their quotas, and punishing producers that have overproduced and now have to forego most of their share of the production hike.

Of these overproducers, Iraq and Russia appear to be trying to fall in line, but Kazakhstan continues to defy OPEC+ and pumps hundreds of thousands of barrels per day above its output ceiling, citing its inability to force foreign oil majors to cut production from new projects.

The actual production increase from OPEC+ will be lower than the headline figure suggests, due to compensations for previous overproduction.

Nevertheless, the superhike in August – and possibly in September – would accelerate the market glut after peak summer demand starts to wane in the autumn and winter, analysts say.

Tyler Durden Mon, 07/07/2025 - 15:05

Trade Crackdown: 14 Countries Receive Tariff Letters Including Japan, South Korea, & Thailand

Trade Crackdown: 14 Countries Receive Tariff Letters Including Japan, South Korea, & Thailand

Update (1422ET): By late afternoon, the White House social media team had posted a total of seven trade warning letters, with the latest addressed to Malaysia, Kazakhstan, South Africa, Laos, Myanmar, Cambodia, Thailand, Serbia, Bangladesh, Indonesia, Bosnia and Herzegovina, and Tunisia. Earlier in the day, letters to Japan and South Korea were also made public on Truth Social.

Here are the trade warning letters per country:

  1. Malaysia

  2. Kazakhstan

  3. South Africa

  4. Laos

  5. Myanmar

  6. South Korea

  7. Japan

  8. Tunisia

  9. Thailand

  10. Cambodia

  11. Serbia

  12. Bangladesh

  13. Indonesia

  14. Bosnia and Herzegovina

The remaining letters, as noted by White House Press Secretary Karoline Leavitt earlier, will be released via Truth Social. 

*   *   *

Update (1345ET):

White House Press Secretary Karoline Leavitt announced that, alongside Japan and South Korea, a dozen additional countries will soon receive similar trade warning letters, all of which will be publicly posted on President Trump's Truth Social account.

Leavitt also stated that the tariff implementation deadline has been moved from July 9 to August 1, giving the countries that receive letters a clear ultimatum: negotiate now.

Latest headlines:

  • LEAVITT: THERE WILL BE 12 OTHER COUNTRIES GETTING NOTIFICATION

  • LEAVITT: TRUMP TO SIGN ACTION TODAY DELAYING TARIFFS

  • LEAVITT: LETTERS WILL BE POSTED TO TRUTH SOCIAL

  • LEAVITT: TRUMP ALSO SIGNING ORDER DELAYING TARIFFS TO AUG 1

*   *   * 

 

Update (1246ET):

U.S. main equity indexes, the S&P 500 and Nasdaq, fell to session lows after the Trump administration released tariff letters to a handful of countries, citing "persistent trade imbalances" and the failure to reach trade deals before the July 9 deadline. The tariffs are expected to take effect on August 1.

The first two trade letters were sent to South Korea and Japan, imposing a 25% tariff on all goods, effective August 1. 

Here are the key points from the letter addressed to South Korea that was posted on President Trump's Truth Social page:

  • The U.S. views the trade relationship as unbalanced and non-reciprocal.

  • The 25% tariff applies to all Korean goods, unless they are produced within the U.S.

  • The tariff is separate from sectoral tariffs and will be increased if Korea retaliates with its own tariff hikes.

  • The U.S. encourages Korea to open its markets and remove trade barriers—offering a possible tariff reduction if this happens.

  • The trade deficit is framed as a national security threat. 

Full Letter US Sent South Korea

Here are the key points from the letter addressed to Japan that that was posted on Trump's Truth Social page:

  • A 25% tariff will be imposed on all Japanese products entering the U.S. starting August 1, 2025.

  • This tariff applies separately from all existing sectoral tariffs.

  • The U.S. cites Japan’s tariffs, non-tariff policies, and trade barriers as causes of a persistent and unsustainable trade deficit; The U.S. claims the relationship has been non-reciprocal for too long.

  • No tariffs will apply if Japanese companies manufacture products within the U.S.

  • If Japan raises its tariffs, the U.S. will add that amount to the existing 25% tariff.

  • The U.S. expresses willingness to reconsider or adjust tariffs if Japan opens its markets and removes trade barriers.

Full Letter US Sent To Japan

The instant reaction in U.S. markets was traders hitting the 'sell button,' with the S&P 500 and Nasdaq sliding to session lows. 

Both yen and won tumbled on the news...

All in all, this is a trade ultimatum from the Trump administration to South Korea, Japan, and other countries, pressuring them to reduce trade barriers and tariffs and to reshore manufacturing in the U.S. The letter signals a broader 'America First' agenda and tariff diplomacy, aimed at reducing trade deficits by penalizing countries with perceived unfair trade practices. We suspect the other letters will be sent out shortly.

Related: 

Vietnam has become the benchmark—both the ceiling for countries striking deals with the U.S. Trump is giving Japan and South Korea a final three-week deadline to reach a deal—failure to do so could mean severe consequences.

*   *   * 

 

Trade tensions are back in view as the 90-day deadline to reciprocal tariffs (which sparked a painful but extremely short market correction) approaches on July 9, with Trump pledging to start issuing unilateral rates to dozens of countries in the coming days. Stocks retreated at the start of a potentially volatile week as US trading partners rushed to finalize trade deals with the Trump administration ahead of the Wednesday deadline. However, one potential offset is that there are increasingly suggestions that August 1st might be the new July 9th (more below).

As a benchmark, DB's economists believe the current effective tariff rate is around 15% (same as Morgan Stanley, see chart below), which is obviously a good deal below the implied rate from Liberation Day, but well above the low single figures before Trump returned to office. It is good news for markets that Section 899 (the revenge tax) has been consigned to the history books after not making it into the tax bill. It's also good news that Bessent has recently sounded more positive on the direction of travel in recent talks. 

However, with financial conditions easy again and with the S&P 500 back at all-time highs, it wouldn't be a surprise to see the Trump Administration take a tough stance with those who they don't think negotiations are going in the right direction (this was discussed over the weekend in "The Risk For Stocks Is That The Administration Decides It Was Correct All Along On Tariffs"). 

President Trump said at the end of last week that by the July 9 deadline, tariffs would be "fully covered and they’ll range in value from maybe 60 or 70% tariffs to 10 and 20%." Then over the weekend he said that he'd “signed some letters and they’ll go out on Monday – probably 12”. Overnight this was firmed up to noon Washington time today, so expect a flurry of headlines at noon!

On Thursday Trump mentioned that the letters could go out on the Friday holiday and apply from August 1st if no deal can be made. This gave some comfort that there could be yet another extension and time to do deals. Bessent has also reiterated over the weekend that some countries would be able to negotiate a three-week extension to August 1st. So maybe we'll just be here again in three weeks when everyone is on the beach apart from the trade negotiators.

Bessent also said Trump will send letters to trading partners notifying them if no deal is reached, they will revert to April 2nd tariff levels while also adding that they are close to several deals and expect to see some big announcements in the next days. Furthermore, Bessent said 100 smaller countries will get set a tariff rate and many never even contacted the US.

For Europe, Bloomberg reported that the union is willing to accept a 10% universal tariff if exemptions for areas such as autos (25%) and steel and aluminum (50%) are provided. For Japan, the mood turned negative last week as President Trump said that they should "pay 30%, 35%, or whatever the number is that we determine, because we also have a very big trade deficit with Japan." On the bright side, Treasury Secretary Bessent said they were "very close" to a deal with India, and on Thursday the US reached a trade deal with Vietnam. 

Then overnight Trump posted on social media that "Any Country aligning themselves with the Anti-American policies of BRICS, will be charged an ADDITIONAL 10% Tariff”

This follows a BRICs summit in Rio over the weekend where the group leaders, including China and India, condemned and called for a "just and lasting" resolution to conflicts across the Middle East.

Courtesy of Newsquawk, here is a summary of all the latest trade/tariff news from the weekend and this morning:

  • Trump said trade letters are signed and are going out on Monday addressed to 12 countries but declined to say which countries or the different tariff levels involved. Trump later commented that they will have a deal or letter with most nations done by July 9th and could send out 12 or 15 letters on tariffs on Monday.
  • Trump posted "I am pleased to announce that the UNITED STATES TARIFF Letters, and/or Deals, with various Countries from around the World, will be delivered starting 12:00 P.M. (Eastern), Monday, July 7th"
  • Trump posted "Any Country aligning themselves with the Anti-American policies of BRICS, will be charged an ADDITIONAL 10% Tariff. There will be no exceptions to this policy."
  • Bessent said Trump will send letters to trading partners notifying them if no deal is reached, they will revert to April 2nd tariff levels with the tariffs to take effect on August 1st, while Bessent added that they are close to several deals and expect to see some big announcements in the next days. Furthermore, Bessent said 100 smaller countries will get set a tariff rate and many never even contacted the US.
  • Russian President Putin told BRICS through a video link that it is important to enhance cooperation at BRICS and the usage of national currencies, while he commented that the liberal globalisation model is becoming obsolete.
  • White House Economic Adviser Hassett said it is possible that some trade negotiations will push past the deadline, while he added that trade deals with the UK and Vietnam provide guidelines for additional agreements with other countries, according to a CBS interview.
  • EU diplomats said on Friday that EU negotiators failed to achieve a breakthrough in US trade talks and negotiations to continue into the weekend, while EU negotiators were looking to secure a US tariff pause extension if no wider trade deal is agreed. It was also separately reported that the US threatened the EU with a 17% tariff on food exports, according to FT.
  • Japan’s tariff negotiator Akazawa held in-depth phone talks with US Commerce Secretary Lutnick on Thursday and Saturday, according to Japan’s government.
  • Japanese automakers are reportedly exploring all options to help reduce trade imbalances with the US, via Nikkei; one idea is Toyota Motor (7203 JT) importing cars made in the US back to Japan.
  • China retaliated against the EU ban regarding public tenders for medical devices by imposing import restrictions on medical devices. China’s Finance Ministry said it is to exclude imports of medical devices exceeding CNY 45mln from the European Union from July 6th, while imports of medical devices from non-EU countries should not contain EU-made components worth more than 50% of the contract value.
  • India and the US are likely to take the final decision on a mini trade deal in the next 24-48 hours (reported on Sunday), with an average tariff under the mini trade deal likely to be 10%, while talks have currently only been completed on a mini-trade deal and negotiations on a larger bilateral trade agreement will begin after July 9th, according to CNBC-TV18.
  • Thailand is to offer the US more trade concessions to avert a 36% tariff with Thailand’s Finance Minister expected to submit the revised orders before July 9th with a proposal to boost bilateral trade volume and reduce Thailand’s USD 46bln trade surplus with the US by 70% within 5 years, according to Bloomberg.
  • South African Trade Department spokesperson says it remains committed to a trade deal with the US; conversations are constructive and fruitful.
  • US-Indonesia trade deal includes buying US soybean, corn and energy products, according to an official.
  • German government spokesperson says time is money when it comes to tariff negotiations; adds, Chancellor Merz is coordinating with EU President von der Leyen, Italy PM Meloni, and French PM Macron on tariff talks.
Tyler Durden Mon, 07/07/2025 - 14:33

Trade Crackdown: 14 Countries Receive Tariff Letters Including Japan, South Korea, & Thailand

Trade Crackdown: 14 Countries Receive Tariff Letters Including Japan, South Korea, & Thailand

Update (1422ET): By late afternoon, the White House social media team had posted a total of seven trade warning letters, with the latest addressed to Malaysia, Kazakhstan, South Africa, Laos, Myanmar, Cambodia, Thailand, Serbia, Bangladesh, Indonesia, Bosnia and Herzegovina, and Tunisia. Earlier in the day, letters to Japan and South Korea were also made public on Truth Social.

Here are the trade warning letters per country:

  1. Malaysia

  2. Kazakhstan

  3. South Africa

  4. Laos

  5. Myanmar

  6. South Korea

  7. Japan

  8. Tunisia

  9. Thailand

  10. Cambodia

  11. Serbia

  12. Bangladesh

  13. Indonesia

  14. Bosnia and Herzegovina

The remaining letters, as noted by White House Press Secretary Karoline Leavitt earlier, will be released via Truth Social. 

*   *   *

Update (1345ET):

White House Press Secretary Karoline Leavitt announced that, alongside Japan and South Korea, a dozen additional countries will soon receive similar trade warning letters, all of which will be publicly posted on President Trump's Truth Social account.

Leavitt also stated that the tariff implementation deadline has been moved from July 9 to August 1, giving the countries that receive letters a clear ultimatum: negotiate now.

Latest headlines:

  • LEAVITT: THERE WILL BE 12 OTHER COUNTRIES GETTING NOTIFICATION

  • LEAVITT: TRUMP TO SIGN ACTION TODAY DELAYING TARIFFS

  • LEAVITT: LETTERS WILL BE POSTED TO TRUTH SOCIAL

  • LEAVITT: TRUMP ALSO SIGNING ORDER DELAYING TARIFFS TO AUG 1

*   *   * 

 

Update (1246ET):

U.S. main equity indexes, the S&P 500 and Nasdaq, fell to session lows after the Trump administration released tariff letters to a handful of countries, citing "persistent trade imbalances" and the failure to reach trade deals before the July 9 deadline. The tariffs are expected to take effect on August 1.

The first two trade letters were sent to South Korea and Japan, imposing a 25% tariff on all goods, effective August 1. 

Here are the key points from the letter addressed to South Korea that was posted on President Trump's Truth Social page:

  • The U.S. views the trade relationship as unbalanced and non-reciprocal.

  • The 25% tariff applies to all Korean goods, unless they are produced within the U.S.

  • The tariff is separate from sectoral tariffs and will be increased if Korea retaliates with its own tariff hikes.

  • The U.S. encourages Korea to open its markets and remove trade barriers—offering a possible tariff reduction if this happens.

  • The trade deficit is framed as a national security threat. 

Full Letter US Sent South Korea

Here are the key points from the letter addressed to Japan that that was posted on Trump's Truth Social page:

  • A 25% tariff will be imposed on all Japanese products entering the U.S. starting August 1, 2025.

  • This tariff applies separately from all existing sectoral tariffs.

  • The U.S. cites Japan’s tariffs, non-tariff policies, and trade barriers as causes of a persistent and unsustainable trade deficit; The U.S. claims the relationship has been non-reciprocal for too long.

  • No tariffs will apply if Japanese companies manufacture products within the U.S.

  • If Japan raises its tariffs, the U.S. will add that amount to the existing 25% tariff.

  • The U.S. expresses willingness to reconsider or adjust tariffs if Japan opens its markets and removes trade barriers.

Full Letter US Sent To Japan

The instant reaction in U.S. markets was traders hitting the 'sell button,' with the S&P 500 and Nasdaq sliding to session lows. 

Both yen and won tumbled on the news...

All in all, this is a trade ultimatum from the Trump administration to South Korea, Japan, and other countries, pressuring them to reduce trade barriers and tariffs and to reshore manufacturing in the U.S. The letter signals a broader 'America First' agenda and tariff diplomacy, aimed at reducing trade deficits by penalizing countries with perceived unfair trade practices. We suspect the other letters will be sent out shortly.

Related: 

Vietnam has become the benchmark—both the ceiling for countries striking deals with the U.S. Trump is giving Japan and South Korea a final three-week deadline to reach a deal—failure to do so could mean severe consequences.

*   *   * 

 

Trade tensions are back in view as the 90-day deadline to reciprocal tariffs (which sparked a painful but extremely short market correction) approaches on July 9, with Trump pledging to start issuing unilateral rates to dozens of countries in the coming days. Stocks retreated at the start of a potentially volatile week as US trading partners rushed to finalize trade deals with the Trump administration ahead of the Wednesday deadline. However, one potential offset is that there are increasingly suggestions that August 1st might be the new July 9th (more below).

As a benchmark, DB's economists believe the current effective tariff rate is around 15% (same as Morgan Stanley, see chart below), which is obviously a good deal below the implied rate from Liberation Day, but well above the low single figures before Trump returned to office. It is good news for markets that Section 899 (the revenge tax) has been consigned to the history books after not making it into the tax bill. It's also good news that Bessent has recently sounded more positive on the direction of travel in recent talks. 

However, with financial conditions easy again and with the S&P 500 back at all-time highs, it wouldn't be a surprise to see the Trump Administration take a tough stance with those who they don't think negotiations are going in the right direction (this was discussed over the weekend in "The Risk For Stocks Is That The Administration Decides It Was Correct All Along On Tariffs"). 

President Trump said at the end of last week that by the July 9 deadline, tariffs would be "fully covered and they’ll range in value from maybe 60 or 70% tariffs to 10 and 20%." Then over the weekend he said that he'd “signed some letters and they’ll go out on Monday – probably 12”. Overnight this was firmed up to noon Washington time today, so expect a flurry of headlines at noon!

On Thursday Trump mentioned that the letters could go out on the Friday holiday and apply from August 1st if no deal can be made. This gave some comfort that there could be yet another extension and time to do deals. Bessent has also reiterated over the weekend that some countries would be able to negotiate a three-week extension to August 1st. So maybe we'll just be here again in three weeks when everyone is on the beach apart from the trade negotiators.

Bessent also said Trump will send letters to trading partners notifying them if no deal is reached, they will revert to April 2nd tariff levels while also adding that they are close to several deals and expect to see some big announcements in the next days. Furthermore, Bessent said 100 smaller countries will get set a tariff rate and many never even contacted the US.

For Europe, Bloomberg reported that the union is willing to accept a 10% universal tariff if exemptions for areas such as autos (25%) and steel and aluminum (50%) are provided. For Japan, the mood turned negative last week as President Trump said that they should "pay 30%, 35%, or whatever the number is that we determine, because we also have a very big trade deficit with Japan." On the bright side, Treasury Secretary Bessent said they were "very close" to a deal with India, and on Thursday the US reached a trade deal with Vietnam. 

Then overnight Trump posted on social media that "Any Country aligning themselves with the Anti-American policies of BRICS, will be charged an ADDITIONAL 10% Tariff”

This follows a BRICs summit in Rio over the weekend where the group leaders, including China and India, condemned and called for a "just and lasting" resolution to conflicts across the Middle East.

Courtesy of Newsquawk, here is a summary of all the latest trade/tariff news from the weekend and this morning:

  • Trump said trade letters are signed and are going out on Monday addressed to 12 countries but declined to say which countries or the different tariff levels involved. Trump later commented that they will have a deal or letter with most nations done by July 9th and could send out 12 or 15 letters on tariffs on Monday.
  • Trump posted "I am pleased to announce that the UNITED STATES TARIFF Letters, and/or Deals, with various Countries from around the World, will be delivered starting 12:00 P.M. (Eastern), Monday, July 7th"
  • Trump posted "Any Country aligning themselves with the Anti-American policies of BRICS, will be charged an ADDITIONAL 10% Tariff. There will be no exceptions to this policy."
  • Bessent said Trump will send letters to trading partners notifying them if no deal is reached, they will revert to April 2nd tariff levels with the tariffs to take effect on August 1st, while Bessent added that they are close to several deals and expect to see some big announcements in the next days. Furthermore, Bessent said 100 smaller countries will get set a tariff rate and many never even contacted the US.
  • Russian President Putin told BRICS through a video link that it is important to enhance cooperation at BRICS and the usage of national currencies, while he commented that the liberal globalisation model is becoming obsolete.
  • White House Economic Adviser Hassett said it is possible that some trade negotiations will push past the deadline, while he added that trade deals with the UK and Vietnam provide guidelines for additional agreements with other countries, according to a CBS interview.
  • EU diplomats said on Friday that EU negotiators failed to achieve a breakthrough in US trade talks and negotiations to continue into the weekend, while EU negotiators were looking to secure a US tariff pause extension if no wider trade deal is agreed. It was also separately reported that the US threatened the EU with a 17% tariff on food exports, according to FT.
  • Japan’s tariff negotiator Akazawa held in-depth phone talks with US Commerce Secretary Lutnick on Thursday and Saturday, according to Japan’s government.
  • Japanese automakers are reportedly exploring all options to help reduce trade imbalances with the US, via Nikkei; one idea is Toyota Motor (7203 JT) importing cars made in the US back to Japan.
  • China retaliated against the EU ban regarding public tenders for medical devices by imposing import restrictions on medical devices. China’s Finance Ministry said it is to exclude imports of medical devices exceeding CNY 45mln from the European Union from July 6th, while imports of medical devices from non-EU countries should not contain EU-made components worth more than 50% of the contract value.
  • India and the US are likely to take the final decision on a mini trade deal in the next 24-48 hours (reported on Sunday), with an average tariff under the mini trade deal likely to be 10%, while talks have currently only been completed on a mini-trade deal and negotiations on a larger bilateral trade agreement will begin after July 9th, according to CNBC-TV18.
  • Thailand is to offer the US more trade concessions to avert a 36% tariff with Thailand’s Finance Minister expected to submit the revised orders before July 9th with a proposal to boost bilateral trade volume and reduce Thailand’s USD 46bln trade surplus with the US by 70% within 5 years, according to Bloomberg.
  • South African Trade Department spokesperson says it remains committed to a trade deal with the US; conversations are constructive and fruitful.
  • US-Indonesia trade deal includes buying US soybean, corn and energy products, according to an official.
  • German government spokesperson says time is money when it comes to tariff negotiations; adds, Chancellor Merz is coordinating with EU President von der Leyen, Italy PM Meloni, and French PM Macron on tariff talks.
Tyler Durden Mon, 07/07/2025 - 14:33

The Frightening Dream House Of Zoran Mamdani

The Frightening Dream House Of Zoran Mamdani

Authored by Victor Davis Hanson via American Greatness,

Zoran Mamdani built his dream on radical chic... but now that he's winning, he's scrambling to bury the blueprint...

After his first-place win in the New York City mayoral primaries, Zoran Mamdani is furiously denying everything that he once glibly thought was cutting-edge and cool.

So, like a good postmodern relativist, Mamdani now claims he didn’t really mean that violence was merely a “construct.”

I suppose Mamdani asked Jewish New Yorkers—the target of 44 percent of all hate crimes in the city—and discovered that their concussions and blood were all too real.

As a good soldier in the ranks of Black Lives Matter, Mamdani now insists he did not trash the police and advocate defunding them.

Neither did he really, really mean to claim falsely he was African-American when he applied to college nor did really, really mean to do a video mocking the Jewish holiday of Hannukah.

Mamdani once thought it was cool to boast about defunding the police when he was an edgy, rising, left-wing community activist.

But then it was smarter to play it down as a candidate. And now it is essential to lie and deny it as a front-runner.

As a good communist, Mamdani echoed Karl Marx by bragging about his ultimate agenda: “the end goal of seizing the means of production.”

But whose “means of production” would Mamdani start seizing?

Trump Tower? Tesla dealerships? Amazon warehouses?

Mamdani warns us, “I don’t think that we should have billionaires, frankly.”

Then, please tell us, how would you get rid of them?

Confiscate their money? Tax them at a 99 percent rate?

Maybe dox them and let the public handle the rest?

Mamdani brags he would “globalize the intifada.”

Given that most define the intifada (“shaking off”) as the two violent Palestinian waves of terrorism against Israel, what then does Mamdani mean by globalizing it?

Is the violence at universities like Columbia insufficient without escalating to the old PLO or current Hamas levels?

Mamdani said that, as mayor, he would arrest Israeli Prime Minister Benjamin Netanyahu if he came to New York City.

But what crime would Netanyahu be guilty of?

Trying to stop another Hamas October 7 massacre of Jewish civilians?

Attempting to prevent the Iranians from getting a nuclear bomb and thereby fulfilling their daily promise of destroying Israel?

If Mamdani believes the democratically elected Netanyahu deserves to be jailed, then would he similarly arrest a visiting Chinese President Xi Jinping for putting a million Uyghurs in labor camps?

How about arresting Venezuelan communist dictator Nicolas Maduro, who has “disappeared” some 20,000 of his own people?

How about Iranian President Masoud Pezeshkian, whose government executes homosexuals?

Or is it just Jewish leaders who would be subject to Mamdani’s warrants?

Mamdani promises to target “richer” and “whiter” neighborhoods for higher taxes.

But in all analyses of median family household income, so-called whites rank far from the top at a distant eighth.

Who, on average, ranks as the richest ethnic group in America?

Asian immigrants of Indian ancestry—like Mamdani and his own family.

So, why didn’t the supposedly erudite Mamdani say he was going after the statistically “richest” group in the nation for his tax hikes—like Indian-American households?

Or was race more important than income in Mamdani’s Marxist view of collective enemies?

Mamdani touts free transportation, rent control, and state-owned grocery stores as if they were new ideas. But they are stale, old-fashioned policies that have failed everywhere from the Soviet Union to Castro’s Cuba—and often here in blue-state university cities.

Mamdani reflects a pattern of affluent, left-wing, and highly educated immigrants from impoverished countries.

Barack Obama’s father, Kamala Harris’s father, and Rep. Ilhan Omar’s parents fled the poverty, violence, and corruption of their homeland only to find prosperity, even affluence, amid the safety and the rule of law in the United States.

They and their American-born children were often the recipients of generous government scholarships and favorable preferences in admissions, hiring, and career advancements under affirmative action and diversity/equity/inclusion protocols.

But instead of appreciating the unique security and magnanimity of their adopted country, they so often embraced boilerplate invective against America as an unkind, unfair, and unequal place.

For Obama, America needed to be “fundamentally transformed.” For Omar, her adopted homeland was one of the “worst” countries, and she added it had become even worse than the Somaliland dictatorship she fled.

For Mamdani, whose parents rank in the top one percent of income and educational brackets, the America his family sought as a refuge must be transformed into one of the socialist-communist nations of the sort that have failed everywhere.

The glib Mamdani has canned answers for all of his past embarrassments—except one.

Why would he wish to turn New York City into a social basket-case like Uganda, which his now-rich parents fled to reach America in the first place?

Tyler Durden Mon, 07/07/2025 - 14:25

'Hit Us, Please' - America's Left Issues A 'Broken Arrow' Signal To Europe

'Hit Us, Please' - America's Left Issues A 'Broken Arrow' Signal To Europe

Authored by Jonathan Turley,

“Broken arrow” is arguably the most chilling and desperate order that an American military commander can issue. When faced with an enemy about to overrun a surrounded force, a commander uses it to call in an air or artillery strike on his own position.

This month, many on the American left are issuing their own “broken arrow” signals, including calling on globalist allies to hit the U.S. with sanctions and other measures. They are seeking to achieve through sanctions what they could not achieve through elections.

The most recent such call came from commentator Elie Mystal on “The Joy Reid Show” this week.

“Our country needs to be sanctioned,” he said.

“We are the bad guys on the world stage. We are a menace to not only free people everywhere, but we are a menace to peaceful people everywhere at this point, and I’m not even going to say that we’ve only been a menace for the past three or four months.”

Mystal’s call was hardly a surprise for those familiar with his writings. A regular commentator on MSNBC, he previously called the Constitution “trash” and urged not just the abolition of the U.S. Senate but also of “all voter registration laws.”

Yet, he is not alone in signaling that his position is being overrun by his fellow citizens.

After Elon Musk bought Twitter with a pledge to dismantle its censorship system, former Democratic Presidential candidate Hillary Clinton called upon Europe to use its infamous Digital Services Act to force him to censor fellow Americans.

Nina Jankowicz, the former head of Biden’s infamous Disinformation Governance Board, appeared recently before the European Parliament. She called upon the 27 EU countries to fight against the U.S., which she described as a global threat.

To the delight of globalists, she declared, “Before I describe the details of Russia’s recent online influence campaigns, I would like to call upon you to stand firm against another autocracy: The United States of America.”

This year, I spoke in Berlin at the World Forum and was surprised to see many Americans joining European leaders in support of the forum’s slogan, “A New World Order with European Values.” Attended by figures such as Bill and Hillary Clinton, the conference heralded Europe as key to countering the threat posed by the U.S.

Others denounced America as the world’s villain with boycotts and protests during Fourth of July celebrations. One leading influencer declared that “this country is beyond f**ked” and encouraged citizens to “walk away from the illusion that they built” around this country.

Democratic politicians and pundits have fueled the anger by claiming fighting the current U.S. government is like fighting against the Nazis, including most recently former Vice President Al Gore. Others like Rep. Pramila Jayapal have called ICE agents “terrorists” for enforcing immigration laws.

The crisis of faith on the left often seems to be triggered by any adverse decision or election. In 2022, the Pima County, Arizona Democratic Party tweeted “F–k the Fourth” after the Supreme Court overturned Roe v. Wade.

This year, Fourth of July celebrations were canceled in Los Angeles under the claim that officials feared a mass arrest by ICE — rather implausible, considering that protests against ICE will be held as planned.

Others are organizing protests this week, declaring “F**k fourth of July. We have a king that we need to get rid of first.”

The problem for those calling on the EU to fight the U.S. is democracy itself, something of a headache for the global elite in Brussels. European governments are cracking down on conservative and other groups, which are soaring in popularity, with calls for stronger borders and reversing mass immigration trends. Great Britain, France, Italy, Germany, and other countries have experienced a similar surge in the popularity of conservative parties.

The fact is, many of the triggers for these “No Kings” protests are the product of the democratic process from the “Big Beautiful Bill” to changes in immigration policy. Citizens voted for change and successfully secured it, and some people are angry about it.

At the same time, our courts continue to function as designed in reviewing these orders and policies. Trump has won some and lost some before the Supreme Court, as constitutional limits are defined and enforced.

In my forthcoming book, Rage and the Republic: The Unfinished Story of the American Revolution, I explore the future of American democracy in the 21st Century in light of economic and political movements, including the current crisis of faith of many on the left over our fundamental values and institutions.

The irony is that this crisis is largely centered among the most privileged classes. Yet recent Gallup polling shows patriotism is at an all-time low. However, the drop is found almost entirely among Democrats. Only 36 percent of Democrats reported being extremely or very proud to be American, compared to 92 percent of Republicans.

Some are simply moving to foreign countries. The New York Times has fanned the flames of those claiming that the U.S. is a new fascist regime. Recently, it featured the declaration of three Yale professors fleeing American fascism for the free nation of Canada. In their piece, titled “We study fascism and we are leaving the United States,” the professors explain that “the lesson of 1933 is that you get out sooner rather than later.”

But what these professors call fascism looks a lot like the democratic process to others. The problem with democracy is that it does not always produce the outcome you want.

For some, support for democratic choice seems to extend only to fellow citizens who make the “right” choice, from their own perspective, of course. So faced with losses in elections and in Congress, many are shouting “broken arrow” and hoping for external help in crushing the opposition.

Yet the fact is, this country is not being “overrun.” Those are fellow citizens who are calling for these policy changes and rejecting far-left policies. Just as many in Europe are calling on the EU to block far-right democratic victories, many in this country are advocating for the trashing of the Constitution or transnational interventions to reverse political voting trends.

The fact is, the far left is not truly surrounded. They have simply retreated into smaller and smaller echo chambers rather than engage the rest of the country on these issues. Viewed from within the protected spaces of MSNBC or BlueSky, you can feel surrounded, but it remains a type of self-isolation. It is like watching wagons frantically circling on the plains without a hostile in sight. The problem is that most of America has moved on.

In the end, the calls for a globalist intervention are a final desperate call of America’s self-isolated left.

Jonathan Turley is the Shapiro Professor of Public Interest Law at George Washington University and the best-selling author of “The Indispensable Right.”

Tyler Durden Mon, 07/07/2025 - 13:45

Russian Transport Minister Dies By Gunshot Hours After Getting Fired By Putin

Russian Transport Minister Dies By Gunshot Hours After Getting Fired By Putin

Russian Transport Minister Roman Starovoit is reported to have died by suicide on Monday, a mere hours after being dismissed from his post by President Vladimir Putin, according to Kremlin officials.

Hours prior to Starovoit's death, Putin signed the order removing him from office, with the official decree having been quickly published on the Kremlin’s website. Deputy Minister Andrey Nikitin has been named as acting transport minister in the wake of the dismissal.

Kremlin spokesman Dmitry Peskov was questioned by reporters on the firing, but did not provide details or a specific reason for the sudden change, but he did deny that it was due to a "lack of trust" when asked.

According to emerging details conveyed through Russian state sources: 

The Investigative Committee of Russia said in a statement that Starovoit’s body was found inside a car in Odintsovo, a suburb of Moscow. He was found with a gunshot wound, the committee said. It said the circumstances of his death were being investigated but the “main theory is suicide.”

Starovoit had barely served a year in the job, after being appointed in May 2024. Before that he was governor of the Kursk region bordering Ukraine for nearly half a decade. 

As Kursk governor, he had faced severe criticism and scrutiny for security lapses which allowed for last summer's Ukrainian invasion and occupation of large swathes of Russian soil, which lasted for well over six months.

Starovoit's dismissal may have served as a public accountability scapegoat of sorts related to widespread public frustration and anger over weeks of commercial travel delays.

Russia has witnessed weeks of disruptions to air travel across almost every major city in the Western and most populated portion of the country, due to constant drone assaults out of Ukraine.

The Russian Federal Agency for Air Transport has lately said that 485 flights have been canceled, 88 rerouted, and approximately 1,900 experienced delays just over this past weekend and into Monday.

Ukraine's military and intelligence leadership has lately openly boasted that its actions targeted against Russian soil have disrupted daily life there, in order to put pressure on the Putin government, and destabilize society.

Given the recent history of deaths of top officials, and even oil execs - often under mysterious circumstances -Starovoit's death is also raising eyebrows and fueling speculation that it may be foul play. For example there was this headline from merely days ago...

CNBC highlights a potential corruption scandal: "A presidential decree published earlier on Monday gave no reason for the dismissal of Roman Starovoit after barely a year in the job, though political analysts were quick to raise the possibility that he may have been dismissed in connection with an investigation into corruption in the region he once ran," the report says.

It continues: "Reuters could not independently confirm these suggestions, though a transport industry source, who declined to be named due to the sensitivity of the matter, said Starovoit’s position had been in question for months due to questions about the same corruption scandal, which centred on funds earmarked for fortifying Russia’s border with Ukraine in the Kursk region."

Tyler Durden Mon, 07/07/2025 - 13:25

Why Recessions Are Not About Declining GDP

Why Recessions Are Not About Declining GDP

Authored by Frank Shostak via Mises.org

Most economic commentators consider a decline in economic statistics, such as gross domestic product (GDP), as indicative of a decline in the health of the economy. According to most experts, this decline in the GDP—which is called a recession—as a rule, arises because of an overall decline in the aggregate demand for goods and services. This is seen predominantly as a decline in the private sector’s buying of goods and services.

Consequently, it is recommended that the central bank should step in and strengthen the private sector’s demand. This, it is held, will pull the economy out of the slump. The means recommended by experts are the lowering of interest rates by increasing the growth rate of money supply.

The problem—central to economics—is that goods are not readily available. These goods have to be produced by transforming various things in nature into goods, either capital goods (to make other goods) or consumer goods. The transformation of things undergoes various stages and takes time. In an economy, which operates in the framework of the division of labor, some individuals are employed in the extraction of various raw materials such as coal and iron. Some other individuals are employed in the conversion of raw materials into various tools and machinery. Still some other individuals are employed in the transformation—using tools and machinery—of various things into consumer goods.

In order to support this process of production through time, saving is required to sustain producers. Saving supports individuals in all the stages of production—from the producers of immediate consumer goods, to the producers of raw materials, and the producers of tools and machinery. This saving to support capital accumulation and growth has been called a “subsistence fund” because it sustains individuals in the various stages of the production structure.

Capital goods—like consumer goods—are also scarce. In order to make these goods, it is necessary to save and sacrifice. The goal is to create capital goods which will ultimately make production more productive and efficient—saving time, energy, and resources. As we can see, simply getting people to consume or spend more to increase aggregate demand, thus increasing the GDP metric, does not grow the economy. Production and saving must take place prior to consumption, in fact, that is what enables greater consumption.

What Is a Recession?

A recession is not really a weakening of GDP and various other economic indicators, but the liquidation of various non-productive activities that have emerged on the back of the loose monetary policies of the central bank. We label these activities bubbles. When the central bank loosens its monetary stance, this lays the foundation of exchanges of nothing for something, which amounts to a diversion of savings from wealth-generating activities to non-wealth-generating activities. This undermines the wealth generation process.

Once the central bank slows this process of monetary and credit expansion—which had built up a distorted structure of production—a recession reveals the malinvestments. Activities that sprang up on the back of the previous easy-money policies are now getting less support as a result of a tighter monetary stance. These activities fall into trouble—an economic bust, or a recession emerges. Regardless of how big and strong an economy appears, a tighter monetary stance will undermine bubble activities.

It follows, then, that recessions or economic busts are not about the strength of an economy as such. It is about the liquidation of activities that emerged because of the previous easy monetary policies of the central bank. The recessionary process is set in motion once the central bank reverses its easy-money stance. Ironically, recessions are good news for wealth-generators. A tighter monetary stance slows the diversion of savings from them towards bubble activities. This, in turn, strengthens the wealth-generation process.

According to most commentators, however, as long as consumer spending is increasing, there is no risk of a recession ahead. This means that as long as there is a growing demand by consumers, good times will follow. But demand cannot be independent, it is restricted by the previous production. The only way to raise the ability to consume more is to raise the ability to produce. On this James Mill held,

But if a nation’s power of purchasing is exactly measured by its annual produce, as it undoubtedly is; the more you increase the annual produce, the more by that very act you extend the national market, the power of purchasing and the actual purchases of the nation…. The demand of a nation is exactly its power of purchasing. But what is its power of purchasing? The extent undoubtedly of its annual produce.

Once more, what limits demand is the ability to produce. Greater production of consumer goods depends on production of capital goods. In order to produce more capital goods, saving is required. The answer is not more consumption and spending fueled by inflationary monetary policy.

GDP and the Money Supply

The key variable that most commentators pay attention to is the gross domestic product (GDP). Given that this indicator is based on monetary turnover, then obviously changes in the money supply are followed by changes in the GDP. Policies aimed at preventing the emergence of a recession make things much worse. These policies not only provide support to existing bubble activities but allow the emergence of new bubbles, worsening the situation.

As long as wealth producers can generate an adequate amount of savings to support productive and bubble activities, the inflationary policies of the central bank (which strengthens GDP) are regarded by most experts as a success. Once the ability of wealth-generators to support overall economic activity weakens, the economy is starting to slide into a recessionary hole. No central bank expansionary monetary policy can reverse this slide. On the contrary, it will deepen the economic slump.

Conclusion

A recession should not be defined as two consecutive quarters of negative GDP growth, but as the liquidation of bubble activities that emerged on the back of the previous easy-money policies of the central bank. The recessionary process is set in motion once the central bank reverses its easy stance, however, this inflationary policy cannot be continued forever or it risks undermining the entire monetary economy. What matters for true economic strength is not strong economic data but freedom from the central bank and government policies that tamper with markets and money.

Tyler Durden Mon, 07/07/2025 - 13:00

Canada's Manufacturing Sector Faces Sharp Decline Amid Tariffs And Trade Uncertainty

Canada's Manufacturing Sector Faces Sharp Decline Amid Tariffs And Trade Uncertainty

Canada’s manufacturing sector shrank for the fifth month in a row, with the S&P Global Canada Manufacturing Purchasing Managers’ Index (PMI) falling to 45.6 in June, down from 46.1 in May — well below the neutral 50 mark that separates growth from contraction, according to the Financial Post.

The latest data shows the steepest drop in production since the spring of 2020, when the pandemic hit. According to S&P Global, this downturn was driven by weak demand, a sharp fall in new orders, and ongoing trade challenges. “A lack of new orders underpinned the latest downturn and helped to explain the steepest reduction in production since the height of the pandemic,” said Paul Smith, economics director at S&P Global Market Intelligence.

The Financial Post writes that manufacturers reported a significant decline in export demand, particularly from the U.S., which accounts for around 75% of Canada’s exports. Rising costs due to U.S. tariffs have made Canadian goods less competitive. As a result, international orders dropped at one of the steepest rates in the survey’s history.

“Canada’s manufacturing economy continued to struggle in the face of tariffs and the ongoing uncertainty related to future trade policies,” Smith added.

The slump has forced firms to cut output and reduce purchasing, leading to the fastest drop in input inventories in five years. Some of this was due to intentional destocking, but supply chain delays also led companies to rely on existing stock.

Employment in the sector fell for the fifth consecutive month, with firms choosing not to replace departing staff or enacting layoffs to manage costs. “International sales unsurprisingly were especially subdued, and, against this backdrop, firms chose to make further cuts to their employment and purchasing activity,” said Smith.

Despite the grim data, some manufacturers are cautiously optimistic. Confidence in the outlook rose to its highest level since January, though it remains below the historical average. “Although sentiment improved on hopes of some stability in the year ahead, confidence in the outlook remains subdued and uncertain,” Smith concluded.

Tyler Durden Mon, 07/07/2025 - 12:40

Israel Bombs Ports, Power Plant In Yemen After Month-Long Pause

Israel Bombs Ports, Power Plant In Yemen After Month-Long Pause

On Sunday Israel's military launched airstrikes on three ports and a power facility against Houthi-controlled Yemen, resulting in the group launching a barrage of missiles in retaliation. Israel is calling the major new initiative 'Operation Black Flag'.

The Israeli military (IDF) announced it had targeted the Red Sea ports of Hodeidah, Ras Isa, and as-Salif, as well as the Ras Kathib power station. Additionally, it described striking a radar system aboard the Galaxy Leader, a ship previously seized by the Houthis and currently docked in Hodeidah.

Illustrative: prior Israeli strikes on Yemen, via AP.

This is the first escalation of its kind in nearly a month, and the IDF defended the action as necessary and warranted after intercepting a missile launched from Yemen earlier that day.

At least two more missiles were fired on Israel following the port strikes, with Houthi military spokesperson Yehyaa Saree later confirmed the launches, saying they again targeted Ben Gurion Airport, as well as the ports of Ashdod and Eilat and a power station in Ashkelon.

Israeli defense systems were active in seeking to intercept the inbound missiles, with possible damage on the ground still being assessed. No casualties on either side of this fresh flare-up were initially reported.

There are meanwhile new fears that another war could erupt in the Red Sea, as we also reported earlier.

On Saturday evening, air raid sirens sounded across the Dead Sea region and parts of the West Bank following the launch of a ballistic missile from Yemen toward Israel. The launch, attributed to Iran-backed Houthi forces, marked an alarming expansion of their missile capabilities beyond the Red Sea maritime chokepoint. 

Hours later, on Sunday morning, the UK Maritime Trade Operations (UKMTO) received a report that a merchant vessel transiting 51 nautical miles southwest of Al Hudaydah, Yemen, came under attack by multiple boats armed with small arms and rocket-propelled grenades. The vessel's onboard security team returned fire. The incident remains ongoing.

Israeli Prime Minister Benjamin Netanyahu is visiting  the White House on Monday, where a potential ceasefire deal could materialize to end the 21-month war in Gaza. Trump has previously announced a "final proposal" for a 60-day ceasefire. Renewed conflict in Yemen is likely to also be on the agenda, after the US military formally ended its Red Sea mission.

* * *

Below are more developing events and headlines via Newsquawk:

Middle East

  • Israeli military issued an evacuation order to people at Yemen’s ports of Hodeidah, Ras Isa and Al-Salif, as well as to those inside the Hodeidah power station, while it announced to carry out airstrikes in those areas due to military activities being conducted there. Israel's Defence Minister later confirmed military strikes on Houthi targets in Yemen's ports of Hodeidah, Salif, Ras Isa, as well as the Ras Qatib power plant
  • A Liberia-flagged, Greek-owned bulk carrier was attacked 51NM off Yemen’s Hodeidah, while the UKMTO later announced that all crew abandoned a ship that was attacked southwest of Yemen’s Hodeidah.
  • Israeli PM’s office said the changes requested by Hamas to the Qatari proposal are not acceptable to Israel, while the negotiating team will depart to Qatar for Gaza talks.
  • Israeli PM Netanyahu said he is determined to ensure hostages’ return to Israel and remove the Hamas threat from Gaza, while he said his negotiators in ceasefire talks have clear instructions to achieve an agreement under conditions Israel has accepted. Furthermore, Netanyahu said ahead of his White House meeting that he believes the discussion with US President Trump can certainly help advance these results.
  • US President Trump said he will discuss Iran with Israeli PM Netanyahu and noted Iran’s nuclear program was set back permanently but they may restart in a different location, while Trump also said there could be a Gaza deal during the week ahead.
  • First session of indirect ceasefire talks between Israel and Hamas in Qatar ended inconclusively and the Israeli delegation does not have sufficient mandate to reach an agreement with Hamas as it has no real power, according to two Palestinian officials cited by Reuters.
  • Hamas government office rejected a US State Department accusation that Hamas was involved in an attack on Americans at a Gaza Humanitarian Foundation site on Saturday.
  • UK government re-established diplomatic relations with Syria.
  • The second round of (Israel-Hamas) negotiations in Doha will begin this afternoon, via Al Arabiya sources. Subsequently, there is reportedly a positive atmosphere in Israel-Hamas negotiations, no breakthrough so far, according to Al Hadath.

Ukraine

  • US President Trump said they won’t be sending patriot missiles to Ukraine but talked about it and noted they have to be protected, while he said Russian President Putin is worried about sanctions and understands it may be coming.
  • Russian military forces gained control of Sobolivka in Ukraine’s Kharkiv region and Piddubne in Donetsk region.
  • Russian Foreign Minister says Russia does not need a temporary ceasefire, but rather a lasting peace.
Tyler Durden Mon, 07/07/2025 - 12:00

Luxury Housing Market No Longer Out Of Reach For Some 'Move-Up' Buyers: Report

Luxury Housing Market No Longer Out Of Reach For Some 'Move-Up' Buyers: Report

Authored by Mary Prenon via The Epoch Times (emphasis ours),

Many people recall the Emmy Award–winning sitcom “The Jeffersons,” whose theme song references George and Weezie “moving on up.” Today, that trend is making a comeback in the luxury market, as “move-up” buyers are entering it for the first time.

ppa/Shutterstock

Coldwell Banker’s 2025 Mid-Year Global Luxury Report indicates the U.S. luxury home market remains strong, with more buyers whose significant financial gains on the sales of their current homes are pushing them into a new level of home-buying opportunities.

In preparing the report, the national real estate brokerage analyzed luxury market data from 120 U.S. markets and surveyed more than 200 of their luxury-property specialists to identify five current trends shaping this market segment.

“Buyers who once thought luxury was out of reach are now finding themselves in that tier by default,” Michael Altneu, vice president of the Coldwell Banker Global Luxury Program, said in the report.

“They’re coming to the market with significant equity and high expectations, and they’re helping to sustain activity.”

This group includes homeowners who purchased properties five or more years ago and have made significant gains on their real estate investments.

According to Realtor.com, the threshold prices for the luxury home market vary from state to state, with a low of $750,000 in West Virginia, to a high of $5.49 million in New York.

Elena Novak, a lead real estate researcher analyst at PropertyChecker.com, told The Epoch Times that the trend of “move up” buyers is real and growing.

“This is mostly due to record-high home equity, and many are putting their money toward larger homes, often in cash or with very small mortgages,” she said, citing an earlier report by data company ATTOM that notes U.S. home sellers in 2024 made an average profit of $122,500 per sale.

However, Novak cautioned that the housing ladder is getting stuck.

“While these buyers do help free up some mid-range homes, many other homeowners are staying put because they don’t want to give up their low mortgage rates,” she said. “This limits supply for first-time and middle-income buyers.”

Novak believes that the effect of this “move up” trend will be mostly positive for the local economy.

“A move-up buyer means two homes are sold, their old one and the new one [they bought], and that creates more spending, more local jobs, and more tax income,” she said.

She believes the trend is also helping to keep the high-end market healthy, particularly in migration areas like the Sun Belt.

Shaun Michael Lewis, CEO of Clearwater Properties, agrees, adding that the trend is equally as popular in the West.

“Buyers who five years ago might have secured a modest $400,000 house in Bozeman, Montana, are now sitting on perhaps $600,000, $700,000 in equity and can now contemplate the purchase of a home around $1.2 million to $1.5 million in other ‘less hot’ locations where they can get much more home for their money,” he told The Epoch Times.

Nadia Evangelou, senior economist and director at Real Estate Research, told The Epoch Times that the luxury market has been outperforming all other price segments over the past year—in particular, the $1 million-plus tier.

“However, in May 2025, we saw a shift—sales in this segment declined 0.6 percent year over year, marking the first drop in over a year,” she said.

“This softening at the top of the market suggests that broader market dynamics are catching up with high-end buyers.”

Evangelou suggested that the recent stock market volatility could be a possible factor, as it often influences liquidity and buying behavior in the luxury market.

Lewis believes those “moving up” will not only help fuel the tax base, but also the local economy with new luxury homeowners shopping, frequenting restaurants, and hiring specialized services such as landscaping and property management.

On the flip side, the trend is forcing many potential buyers to drive further out from towns like Bozeman to find listings under $400,000.

“This housing shortage also makes it harder for businesses to recruit and keep staff and often forces employers to invent  interim housing fixes like temporary lodging,” Lewis said.

While luxury sales remain strong, he contends they’re splitting the market in half.

“Sellers who are selling properties priced above $1 million are still enjoying relatively quick sales, while homes priced from $600,000–900,000 are sitting on the market for longer, “ he said.

Other Luxury Market Trends

More than 68 percent of those surveyed by Coldwell Banker reported that clients are either maintaining or growing their real estate exposure, with another 51 percent reporting an increase in all-cash transactions. The report indicates that clients are also more unlikely to compromise on lifestyle preferences, property conditions, or luxury features.

“Affluent buyers still see real estate as a safe haven to grow and protect their wealth,” Altneu said in a statement. “But as the market balances and more inventory comes online, they can also be more choosy than in recent years.”

Another trend the report found is that real estate remains a cornerstone of wealth strategy, especially during times of economic uncertainty. It maintains that affluent buyers view real estate as safe haven as well as a valuable tool for portfolio diversification.

“Smart Luxury” is a third emerging trend with luxury homebuyers making more practical considerations such as value for price, tax strategy, estate planning, and long-term investment potential. According to the report, these tend to be taking the place of over-the-top amenities or “trophy” locations.

The fourth trend is a wider divide between the ultra-wealthy versus the aspirational buyer. This translates to buyers with a net worth of $1 million to $5 million as opposed to buyers with a net worth of $30 million and above. The report finds those in the $1 million to $5 million range tend to be more cautious and often target homes with renovation potential.

The final trend pertains to cash buyers, with 96 percent of Coldwell’s luxury specialists reporting buyers maintaining or increasing all-cash deals.

“Ultra-high-net-worth individuals are not just buying one property—they’re building real estate portfolio,” Jade Mills, international ambassador of the Coldwell Banker Global Luxury Program said in the report.

“These buyers are paying all cash specifically because they want hard assets independent of market swings.”

The report quotes data from the Institute for Luxury Marketing showing the luxury single-family home inventory has escalated by 19.6 percent and attached property inventory by 14.8 percent compared with 2024. Still, single-family home prices grew by 1.8 percent year over year and 8 percent compared with 2023. Prices for attached properties have advanced even more—by 8.4 percent year over year and 16.5 percent over the past two years.

An April study by the University of California San Diego Rady School of Management found that all cash home buyers have an advantage by paying about 10 percent less than mortgage buyers.

“When sellers accept a mortgage offer, it comes with risk,” Michael Reher, study co-author and assistant professor of finance at the Rady School of Management said in a statement. “There is a risk the deal will fall through because there’s a third-party mortgage lender who needs to approve the loan for the borrower .”

Reher and a colleague conducted the study after they both had experienced mortgage offers to homes being rejected because sellers chose an all-cash offer instead.

A recent Bankrate blog on cash offers weighs both the pros and cons of these types of transactions, noting quicker closing and less red tape when dealing with a lender, but also the possibility of not receiving the highest amount on the deal.

“Ultimately, deciding whether an all-cash offer is right for you will depend on whether you want to sell as fast as possible,” the webpage reported. “If you have time and want to aim for top dollar, you might get a better deal from a buyer who’s financing.”

Tyler Durden Mon, 07/07/2025 - 11:40

Gunman Ambushes Border Patrol Agents In Texas Amid Anti-ICE Rhetoric From Democrats

Gunman Ambushes Border Patrol Agents In Texas Amid Anti-ICE Rhetoric From Democrats

Fox News correspondent Bill Melugin reported moments ago that a gunman wearing tactical gear and armed with a rifle ambushed U.S. Border Patrol agents at an auxiliary facility earlier this morning. This shooting comes amid increasingly hostile rhetoric directed at federal agents — primarily fueled by Democratic Party lawmakers and their affiliated leftist Marxist NGOs — raising questions about the real-world consequences of politically charged attacks on federal law enforcement. 

"Three federal & TX law enforcement sources tell me an active shooter with a rifle & tactical gear ambushed Border Patrol agents as they arrived at a Border Patrol annex facility in McAllen, TX this morning," Melugin wrote on X. 

He continued, "Local police and federal agents returned fire, killing him. I'm told this was a purposeful ambush/attack against federal agents and a press conference is planned for later this morning." 

Melugin noted that "No federal agents injured. I'm told a McAllen police officer may have been shot, but is in stable condition." 

"Violence against law enforcement officials is unacceptable. Democrat leaders must stop putting targets on the backs of ICE and Border Patrol with their rhetoric," Elon Musk's America PAC (AMERICA) wrote on X. 

Tom Homan, President Trump's border czar, stated on Fox News: "The attack on ICE officers... is up nearly 700% now... We have Senators, we have Congresspeople that compare ICE to the Nazis... The rhetoric has to stop or it's a matter of time before one of the ICE officers goes down."

Last month, a top far-left city official in southeast Los Angeles County called for Mexican gangs to mobilize against ICE agents. 

Will the Trump administration finally get serious about Democrats and their rogue network of leftist NGOs accused of inciting violence against federal agents?

. . . 

Tyler Durden Mon, 07/07/2025 - 11:25

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