Month: August 2024

Authored by Barry Bussey via The Epoch Times,

Since 2016, when Jordan Peterson criticized amendments to Canada’s Human Rights Act and the Criminal Code to include “gender identity and expression” as prohibited grounds for discrimination, he has been in the public eye. He argued that mandating the use preferred pronouns was a form of compelled speech and identity politics run amok.

Peterson’s latest ordeal of having to undergo mandatory training by his regulatory college in order to keep his psychologist’s licence after the country’s highest court refused to hear his appeal, marking another pivotal moment for the free-speech advocate, has once again brought him into the national spotlight.

The college seized upon complaints from individuals around the world—none of whom were Peterson’s patients—to demand that he undergo remedial training on how to conduct himself on social media.

This case transcends Peterson and sets a precedent for all professionals subject to regulatory bodies.

Professionals now face the reality that they must self-censor to avoid punitive actions by their professional overseers. Peterson’s case could impact all Canadian professionals, not just psychologists, by forcing them into ideological compliance or facing professional ruin. It demands serious reflection from all professionals. If you are regulated by a body that determines your livelihood, you have no choice but to recognize the danger and speak out against these encroachments on free speech before it’s too late—for you and for the country.

Peterson revealed that many professionals have reached out to him, emphasizing the importance of this case. But this issue goes beyond just regulatory bodies.

Our key institutions need to be free of ideology. Yet we have witnessed them becoming oriented in the same direction as the prevailing philosophical changes incubated at universities. Justices increasingly rely on law clerks—top law graduates—for research in writing their decisions. These clerks are frequently recommended by professors, some of whom were once court clerks themselves. This close-knit relationship with law schools makes the court system vulnerable to being swayed by the latest academic trends.

Moreover, the courts have increasingly been amenable to the idea that “experts” should be allowed to do their jobs with limited interference. Bureaucratic decisions become sacrosanct because the courts are reluctant to second-guess the “experts.” If charter rights are violated by these decisions, this can be excused if bureaucrats consider “charter values,” a judge-made doctrine requiring decision-makers to consider the “essence” of the charter when making decisions. In Peterson’s case, it is not his freedom of expression that is at stake as much as the “charter values” of diversity, equity, and inclusion.

But the deference to bureaucrats leaves Canadians—including Peterson—without true freedom of expression regarding which ideologies predominate in society.

We are all at a loss in this new reality.

There are too few “Petersons” with the means and courage to fight this societal Goliath. We lose the benefit of professional discourse on issues that matter.

We need the free speech of professionals so that we may benefit from their collective wisdom.

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Peterson has thrown down the gauntlet. He is not willing to back down.

He will go through the mandatory re-education process but has no intention of giving the regulatory college an easy ride, and will be keeping up his challenge.

This is a battle for the very soul of free speech in Canada. It is time to build resilience for what lies ahead.

US chipmaker Microchip Technology disclosed that an “unauthorized party” had compromised “certain servers and some business operations.” This cyberattack raises significant concerns due to Microchip’s critical role in supplying advanced chips to the US defense industry, supporting critical systems such as precision strike and missile defense weapons, radar systems, autonomous platforms, image processing, and command and control centers. 

Microchip first detected “potentially suspicious activity involving its information technology (“IT”) systems” on Saturday, the Chandler, Arizona-based company wrote in an SEC filing on Tuesday. 

“Upon detecting the issue, the Company began taking steps to assess, contain and remediate the potentially unauthorized activity,” Microchip said. 

Microchip admitted that some of its manufacturing facilities had to operate at reduced capacity because of the cyber incident:

As a result of the incident, certain of the Company’s Company’s manufacturing facilities are operating at less than normal levels, and the Company’s ability to fulfill orders is currently impacted. The company is working diligently to bring the affected portions of its IT systems back online, restore normal business operations and mitigate the impact of the incident.

Cyber blog BleepingComputer noted, “While the company has not yet disclosed the nature of the incident, the SEC filing suggests it was ransomware. However, no ransomware operation has claimed responsibility for the attack.”

The cyber incident comes as Washington is supercharging efforts to rebuild the nation’s chip manufacturing base to mitigate supply chain snarls from Asia. This incident is particularly alarming because if the country were locked in a major conflict directly with Russia and/or China, and a cyber incident brought down chip production for defense applications, it would have real consequences on the modern battlefield. 

Authored by Dave DeCamp via AntiWar.com,

President Biden approved in March a new nuclear strategic plan that includes preparations for a simultaneous nuclear war with Russia, China, and North Korea, The New York Times reported on Tuesday.

The US nuclear strategy is updated about every four years or so and is highly classified. The Times described the new strategy as the “first to examine in detail whether the United States is prepared to respond to nuclear crises that break out simultaneously or sequentially, with a combination of nuclear and nonnuclear weapons.”

US officials, including Pranay Vaddi, an arms control official on the National Security Council, have made public comments about the changes to the strategy.

Vaddi said in June that the new strategy emphasizes “the need to deter Russia, the [People’s Republic of China] and North Korea simultaneously.”

The strategy also focuses on China for the first time, as the Pentagon has claimed China could increase its nuclear stockpile to 1,500 by 2035. Current estimates put China’s arsenal at about 500.

China’s arsenal is still just a fraction of what the US and Russia possess. The State Department said in July that the US has 5,748 warheads, including 2,000 that are retired and awaiting dismantlement.

According to the Arms Control Association, Russia has 5,580 warheads, including 1,200 that are retired and awaiting dismantlement. Russia has 1,549 nuclear warheads that are deployed, and the US deploys 1,419.

The New START treaty between the US and Russia caps the deployment of warheads at 1,550. While the treaty has broken down due to tensions over the war in Ukraine, both sides have committed to staying within the deployment limits, but it’s unclear if they will once New START officially expires in 2026.

While China has significantly fewer warheads than the US and Russia, a nuclear exchange between the US and China could still be enough to end life as we know it.

Despite the risk of a US-China war quickly turning nuclear, US military officials are openly planning for a direct clash with Beijing and claim that the US could “win.” 

The US government is run by psychotic warmongers.

Biden approved a classified plan that “ordered U.S. forces to prepare for possible coordinated nuclear confrontations with Russia, China and North Korea”.

They’re planning for potential nuclear war, to try to save the US empire. pic.twitter.com/deqJqM6Vht

— Ben Norton (@BenjaminNorton) August 21, 2024

The nuclear strategy’s focus on China aligns with the Pentagon’s 2022 National Defense Strategy, which names Beijing as the top threat facing the US, with Russia coming in second.

Back in March, when most of Wall Street and economists still believed the lies spewed forth by the Biden Bureau of Labor Statistics, which intentionally uses inaccurate, rushed “data” from the Establishment survey which is meant to pad sentiment and make the economy appear far stronger than it is for propaganda purposes (as one can see by the constant monthly downward revisions), we did an in-depth analysis looking at the actual, “uncooked” numbers published by the Philadelphia Fed preview of the annual Quarterly Census of Employment and Wages employment revision, and warned our readers that actual US payrolls are overstated by at least 800,000.

Philadelphia Fed Admits US Payrolls Overstated By At Least 800,000 https://t.co/JZZxweddh9

— zerohedge (@zerohedge) March 28, 2024

Specifically, we concluded that “the BLS had overstated payrolls by 800,000 through Dec 2023 (and more if one were to extend the data series into 2024)” and added that “it’s truly statistically remarkable how every time the data error is in favor of a stronger, if fake, economy.”

Furthermore, we also noted that the revision “also means that far from the stellar 230K average monthly increase in payrolls in 2023, which the White House would spin time and again as direct evidence of the benefits of Bidenomics, the true average monthly payroll increase in 2023 was only 130K! The full monthly change in payrolls as originally reported by the BLS (in green) and the actual monthly number, as per the QCEW (in red) is shown below.”

This matters because as we reminded our followers this weekend, today at 10am, the BLS would publish its annual nonfarm payrolls benchmark revision where it would unveil as , which it did (with the usual 35 minute delay because that’s the kind of service $35 trillion in debt buys you), and it confirmed that we were right almost to the dot, because as the BLS unveiled in its CES Preliminary Benchmark Announcement, “the preliminary estimate of the benchmark revision indicates an adjustment to March 2024 total nonfarm employment of -818,000 (-0.5 percent)” or just above the 800,000 was said to expect back in March.

The revision is mainly due to the highest-paying sectors: i.e., professional services -358k, leisure -150k, and manufacturing -115k. Not at all surprising: government was revised +1,000.

As an aside, while the data were scheduled to be released at 10 a.m. in Washington but didn’t appear on the BLS’s website for more than a half hour later. A spokesperson for the agency didn’t answer Bloomberg’s questions as to why the figures were delayed, but we have some pretty good guesses about the panic that gripped the BLS as they realized they needed a green lights from the propaganda ministry before going live with this number.

How big is the 818,000 revision in contact? As the chart below shows, the 2024 revision was the biggest in the past decade, and the second biggest on record, with just the 824K downward revision in 2009 just (barely) greater.

The revisions confirm that – as we had been warning for much of the past year – the labor market started moderating much sooner than flawed conventional wisdom thought. It wasn’t until earlier this month that markets and economists grew concerned with the release of the July jobs report. That set off alarm bells with a weak pace of hiring and a fourth month of rising unemployment, but other metrics like jobless claims and vacancies have suggested a more moderate slowdown.

Putting it all together, we now know – as we reported first back in March – that the labor market is, and was, far weaker than conventionally believed. In fact, no less than 800,000 payrolls would end up “missing” when one uses the far more accurate Quarterly Census of Employment and Wages data rather than the BLS’ woefully inaccurate and politically mandated payrolls “data”, and if one looks back the the monthly gains across most of 2023, one gets not 218K jobs added on average every month but rather 150K, a 31% decline. Needless to say, the market would look very different if it had known that effectively all the payroll “beats” of the past year would be deleted!

Of course, none of that paints Bidenomics, or Kamalanomics, or whatever it is now, in a flattering picture, because while one can at least pretend that issuing $1 trillion in debt every 100 days to add 3 million jos per year is somewhat acceptable, learning that that ridiculous amount buys 800,000 jobs less is hardly the endorsement that the White House needs. On the flip side, pretending that the US had added an additional 800,000 jobs in the past year is precisely what Biden, and now, Kamala would have wanted to generate the kind of buzz and momentum that somehow translates into the “greatest economy ever”… at least until it is all revised away as the admin’s lies finally wash away.

What is the implication for the market? Well, as UBS trader Leo He correctly notes, “the Fed is well aware of nonfarm payrolls (establishment survey) overstating the job market, but unemployment rate (household survey) underestimating the job market” and he goes on to quote Governor Bowman’s speech on Tuesday:

“There are also risks that the labor market has not been as strong as the payroll data have been indicating, and it appears that the recent rise in unemployment may be exaggerating the degree of cooling in labor markets. The Q4 Quarterly Census of Employment and Wages (QCEW) report suggests that job gains have been consistently overstated in the establishment survey since March of last year, while the household survey unemployment data have become less accurate as response rates have appreciably declined since the pandemic. The rise in the unemployment rate this year largely reflects weaker hiring, as job searchers entering the labor force are taking longer to find work, and layoffs remain low. It is also likely that some temporary factors contributed to the soft July employment report. The rise in the unemployment rate in July was largely accounted for by workers who are experiencing a temporary layoff and are more likely to be rehired in coming months. Hurricane Beryl also likely contributed to weaker job gains, as the number of workers not working due to bad weather increased significantly last month.”

At the end of the day, all this does is cement the Fed’s 25bps rate cut next month.

As for broader socio-political implications, back in March we concluded our article, which predicted today’s revision with near 100% accuracy, by warning that the staggering size of the revised data “is also why nobody in the mainstream media – which is now nothing more than the PR smokescreen for the Biden puppetmasters, the government and the deep state – will ever mention this report.”

Today it will be more difficult for the propaganda press to ignore it.

Oil edged higher following a short run of declines as traders readied for weekly stockpile data in the US and Washington continues to push for a cease-fire between Israel and Hamas.

US Secretary of State Antony Blinken left the Middle East late Tuesday without a cease-fire agreement, but reiterated that Israel had agreed to a “bridging” deal to create space for the two sides to hammer out details.

API

• Crude +347k (-2.9mm exp)

• Cushing -648k

• Gasoline -1.04mm

• Distillates -2.24mm

DOE

• Crude  (-2.9mm exp)

• Cushing -648k

• Gasoline -1.04mm

• Distillates -2.24mm

Refuting API’s reported small crude build, the official data showed across the board inventory drawdowns last week with crude stockpiles down for the 7th week in the last 8 and distillates stocks falling by the most since March…

Source: Bloomberg

The Biden admin continues to add (marginally) to the SPR (+636k barrels last week)…

Source: Bloomberg

US crude production increased back to record highs (as rig counts continued to slide)…

Source: Bloomberg

Total US Crude inventories fell to their lowest since February…

Source: Bloomberg

WTI extended its (modest) gains after the official data…

Source: Bloomberg

Crude has given up most of its gains this year as China’s lackluster economy overshadowed OPEC+ supply cutbacks. 

Investors are also watching US economic data and await Powell’s speech on Friday at Jackson Hole hoping that lower inflation could lead the the Fed to cut rates — a boon to wider energy demand.

Traders aggressively betting on further moves south for Bitcoin could be caught unawares in the coming days and weeks, with the derivatives market forming a setup primed for a short squeeze.

That’s according to research-led digital assets brokerage K33’s latest analysis, which found a mix of both negative perpetual swap funding rates in recent weeks and a spike in open interest.

“This suggests aggressive shorting, structurally creating a setup ripe for a short squeeze,” K33 analyst Vetle Lunde wrote in a note to investors on Tuesday.

As Decrypt reports, K33’s call for a short squeeze hinges on the 7-day average funding rate, which has decreased since the market crash on August 5, hitting -2.53% on Tuesday.

That’s the lowest it’s been since March 2023, Lunde wrote.

Meanwhile, notional open interest over the last seven days has jumped to its most significant weekly recording in over a year, above 28,880 BTC.

“The current combination of surging open interest and negative 7-day average funding rates is unique and promising,” Lunde wrote.

As a reminder, Decrypt explains that funding rates are periodic payments made between traders in futures markets, specifically for perpetual contracts, which are a type of futures contract without an expiration date.

The rates are used to keep the price of the perpetual contract in line with the spot price.

When the funding rate is positive, more traders betting on prices going up (long positions) pay a fee to those betting on prices going down (short positions).

When the funding rate is negative, it reflects a larger number of traders betting on prices going down are paying a sizeable fee to those banking on prices going up.

Typically, when things are steady, the rate hovers around 10.95%, Lunde wrote.

But when many people start betting aggressively, the rate can move from what’s expected, which normally shows more traders are piling into the same bet.

Bitcoin prices have been significantly choppy in recent days as the short-interest has built (and obviously today’s payrolls revisions has all the algos on edge)…

And as we noted recently it’s not just bitcoin that is seeing its share of negativity…

someone is desperate to slam ETH lower https://t.co/bovdhybpbZ

— zerohedge (@zerohedge) August 11, 2024

Building on that potential, CoinTelegraph reports that several of Bitcoin’s popular trading metrics are flashing positive which may force traders to act quickly and cover their positions if macroeconomic events align, according to a crypto analyst.

“Technical indicators are improving, and with some traders holding short positions, there’s potential for a short squeeze,” 10x Research head of research Markus Thielen said in an Aug. 21 report.

In an Aug. 18 report, CryptoQuant researcher Axel Adler looked to two key metrics – the bubble vs. crush market structure and the ratio between the difference of market cap and realized cap and the standard deviation of market cap (MVRV-Z score) – as signals that Bitcoin’s current price action is tracking a healthy path forward. 

“We can see that the current bull cycle is developing quite steadily without significant anomalies or sharp jumps,” Adler added.

Adding to the bullish sentiment, US spot Bitcoin ETFs have maintained positive flows for eight out of the past ten consecutive trading days. On Aug. 20, the ETFs saw an aggregate inflow of $88 million, their highest for two weeks…

IBIT, which surpassed longtime Bitcoin ETF player Grayscale in terms of assets under management (AUM), has not seen an outflow day since May 1 – the only day of net outflows it has had since it launched in January.

It was also recently reported that 60% of the largest hedge funds in the United States have exposure to Bitcoin ETFs, according to Sam Baker, researcher at investment firm River.

Finally, we note a clear pattern emerging in intraday bitcoin trading since spot ETFs were introduced.

As we have noted numerous times, it appears the perpetual futures market dominates the US session (to the downside), which then enables the ETFs to buy at lower prices during the following Asia and European sessions.

Trade accordingly…

Department store chain Macy’s missed analysts’ estimates for its quarterly revenue and lowered its outlook for sales for the full year, citing “more discriminating consumer and heightened promotional environment relative to its prior expectations.” 

The department store operator said Wednesday in a statement that sales in the second quarter through Aug. 3 fell 3.8% to $4.9 billion, missing the Goldman Sachs consensus of $5.10/$5.06 billion. 

“In the second quarter, we began to see the customer become even more discerning,” CEO Tony Spring said in an interview, as quoted by Bloomberg. 

Spring continued, “We did not see any material change in our traffic. We did see a change in conversion, and that to us really means people were either distracted, or they were even more cautious than we had seen previously.”

A team of Goldman analysts led by Brooke Roach and Evan Dorschne wrote in a note to clients that their first take on Macy’s earnings was “Weaker comp trends and cautious revenue outlook overshadows better 2Q margin delivery.” 

Here’s the analysts’ detailed breakdown of second-quarter results: 

M reported F2Q24 EPS of $0.53, ahead of GS/FactSet consensus of $0.30 with the beat driven by better margins. Despite the beat, sales fell notably light of expectations in the quarter, with retail sales of $4.94bn well below GS/consensus at $5.10/$5.06bn, driven by a sequential slowdown in owned reported comps which decelerated to -4.0% vs. GS/FactSet consensus of -1.0%/-0.9%. This softer sales trend was offset by better profitability with gross margin as a % of retail sales at 40.5% (above GS/consensus 39.8%/40.1%), and SG&A as a percent of total sales at 38.7% (below GS/consensus at 38.8%/38.9%). Inventories were reported +6.0% Y/Y, compared to our expectation of +1.2% Y/Y.

After the weaker-than-expected quarter, attributed to a cautious consumer, Macy’s lowered its annual outlook on sales for the fiscal year to between $22.1 and $22.4 billion, compared with the previous forecast (as of May 31) of between $22.9 billion and $22.3 billion.

Goldman’s Roach and Dorschne added more color to the dismal outlook: 

On the forward outlook, M reaffirmed its FY EPS guidance of $2.55-$2.90, vs. GS/consensus at $2.85/$2.78. However, management took a much more cautious tone on the consumer, pointing to a more discriminating consumer and a heightened promotional environment vs. prior expectations. As a result, management now expects comps (owned + licensed) at -2.0% to -0.5% (vs. -1.0% to +1.5% prior), and net sales are now guided at $22.1bn-$22.4bn (vs. $22.3bn-$22.9bn prior), indicating -4.3% to -3.0% Y/Y declines (vs. -3.4% to -0.8% prior), which compares to GS/consensus at -1.2%/-2.4%. For 3Q, management expects EPS at -$0.04 to $0.01 vs. GS/consensus at $0.07/$0.01.

The analysts noted, “This is a disappointing result for Macy’s and a sharp cut to the company’s forecast for sales and comp trends for the full year.” 

CEO Spring warned in the interview that “it will be a more rocky remainder of the year” for the consumer. 

The retailer decided to increase product discounting to counter the slowdown in discretionary spending.

“We are leaning into every available expense stream” that doesn’t erode customers’ shopping experience, Spring said, adding, “We are trying to make sure that our cost of operations, our packaging, our delivery expense, our costs for paper and shopping bags” are decreasing. 

Goldman analysts concluded, “We are Buy rated on M. Our 12-month price target of $23 is based on 3.85x Q5-Q8 EV/EBITDA and includes a $1 per share contribution value from M’s real estate.” 

Shares of Macy’s are down more than 13% in the early US cash session…

…extending a multi-year trend lower…

Separately, Target beat Wall Street’s earnings and revenue expectations, yet issued a cautious note on the consumer and gave a mixed outlook because of uncertainty surrounding discretionary spending in the months ahead.

Goldamn’s consumer specialist, Scott Feiler, provided clients with commentary surrounding the latest and most important earnings from big box retailers, noting consumer weakness will still be a theme through year-end: 

The big debate post WMT’s beat and better than expected consumer commentary last week was whether they were just taking a lot of share, or if in fact they truly thought the consumer was stable. Post WMT’s huge comp beat and comment that general merchandise flipped positive, expectations for TGT’s comp moved from the +1% range to the +1.5% range. They hit the very high-end of the recent expectations (+2%) and importantly, beat margins by 90 bps, which they did not do last quarter. Is this an all clear in consumer? I would argue it is not, given that they are now talking to the low-end of the prior FY comp guide (probably some conservatism), despite this beat. However, it will certainly be good enough for TGT at this valuation and a little bit more of a relief for the space, even if not an all-clear (Macy’s revenue miss and cut this morning).

What’s clear with Home Depot and Lowe’s executives is that home improvement trends remain under pressure. McDonald’s and Disney have warned about waning consumer spending. And travel companies have warned about a slowdown. The theme building is that low/mid-tier consumers are under pressure in the era of failed Bidenomics.  

By Michael Every of Rabobank

On the border, Nietzsche

“Cruisin’ down the centre of a two-way street; Wonderin’ who is really in the driver’s seat
Minding my business, along comes big brother; Said, “Son, you better get on one side or the other”
(Whoa-ooh) I’m out on the border; (Whoa-ooh) I’m walkin’ the line
Don’t you tell me ’bout your law and order (whoa-ooh); I’m tryin’ to change this water to wine”

          – The Eagles, ‘On the Border’

 

“He who has a why to live for can bear almost any how.”         

          – Nietzsche

——-

It’s not often The Eagles and Nietzsche both describe the political economy, but the US, and the world, are bordering on major change in their “why” and “how” as November’s election looms.

On the border gap, Vice-President Harris proposes amnesty for those who arrived in the US illegally, which would logically incentivize more arrivals failing a tough border approach(?) Trump proposes to deport all those illegal arrivals and take a tough border approach. On one hand, we’d have the larger, unofficial US labor force and the implication of a similar trend ahead. On the other, we’d have a potential drop in the labor force and much lower growth in it. Market economists and the Fed have very belatedly started to realize undocumented immigration might be impacting macro data; the point may be underlined by today’s BLS revision to past payrolls data, where 600,000 to 1m jobs may be cut from the total ‘created’ over a year. If so, the macro story shifts; and so does that of new jobs added net new labor force arrivals. Yet while “Rate cuts!” views of this are already clear, there’s little discussion of the very different assumptions of post-election border policy on wage growth, inflation, housing, budgets, and productivity, etc.

[ZH: and this is what we said back in January, long before “belatedly” everyone else did]

How is this not the biggest political talking point right now: since October 2019, native-born US workers have lost 1.4 million jobs; over the same period foreign-born workers have gained 3 million jobs. pic.twitter.com/Z5HVWmQ24C

— zerohedge (@zerohedge) January 15, 2024

There’s a widening Harris-Trump policy gap on tax. Social media claim Harris backs President Biden’s plan for a 44.6% capital gains tax and a 25% tax on unrealized capital gains for those with more than $100m in assets. That would theoretically narrow the fiscal deficit and act against dangerous inequality; practically it may risk a mass sale of US assets and the move of capital and the rich outside it. Of course, that this tax hike was already raised by Biden yet didn’t pass speaks to the president proposing and Congress disposing: that means those guessing the presidential electoral outcome also need to guess the Senate and House outcomes. Meanwhile, Trump favors lower taxes: fiscal deficit, fiscal shmeficit. Which tax rates do your models assume?

There’s also a Harris-Trump gap on trade. The former may keep existing Biden tariffs and add to them strategically. The latter wants a 20% universal tariff and up to 100% on China. Our house view incorporates a lower universal tariff yet is already inflationary enough for our Fed watcher Philip Marey to call a floor in rate cuts at 4.50% in H1 2025. Imagine if we were to get 20% and 100%! While it’s impossible to find a neoclassical economist who backs tariffs (or the working paper a pro-tariff US think tank says proves they have a positive economic impact), it helps to look at things more broadly in what policy assumptions to make.

To illustrate, my colleague Ben Picton is now reading Factory Man, published in 2004, from which he just shared two key passages from when the US protagonist visits a Chinese furniture factory run by a Taiwanese businessman who had negotiated deals with European and South American counterparties, but had “never met anyone like Americans”, then a CCP official, He YunFeng:

“I have figured you guys out, the translator finally relayed.

Tell me.

If the price is right, you will do anything. We have never seen people before who are this greedy – or this naïve.

The Americans were not only knocking one another over in a stampede to import the cheapest furniture they could, but they were also ignoring the fact that they were jeopardizing their own factories back home by teaching their Asian competitors every nuance of the American furniture-making trade.

When we get on top, the man said, don’t expect us to be dumb enough to do for you what you’ve been dumb enough to do for us.”

“He YunFeng would be happy to provide Basset with the dressers at a fraction of what they cost to make, a feat Basset knew would not be possible without Chinese government subsidies. All Basset had to do in return, Hu YunFeng said, was close his own factories.”

The author, whose protagonist opts to keep his US factory, has their own bias, and the above sounds Trumpian. However, it was not Americans saying it, and they were doing so 20 years ago. How many readers were aware this, not ‘free trade comparative advantage’, was realpolitik two decades ago? More to the point, how many voters — so politicians — were/are now? In short, it’s more logical to expect further global protectionism and goods inflation (and onshoring or friendshoring), than endless structural goods deflation (and deindustrialisation) via China.

Even in China-friendly Thailand, the government may impose tariffs as it worries about the collapse of local industry due to Chinese imports, joining the US, EU, Canada, Mexico, Brazil, India and Indonesia in doing so. Meanwhile, the US and EU are set to impose high tariffs on solar panels made in Malaysia, Thailand, Vietnam, and Cambodia by Chinese firms circumventing existing 25% tariffs on Chinese production, which may rise to 50%. The pattern is clear: the US (and EU) tariffs China; China shifts its exports to others; they also tariff China; China shifts its production to Asia and Mexico; and the US (and EU) tariffs these new China proxies. Ultimately, most countries will either end up being in one trade zone or the other: a Trump election victory would massively accelerate this process.

And what does the non-US bloc look like? Hard to say – but it’s not going to be anything like the US bloc. Russian companies that import from China have started receiving their CNY payments back from Chinese banks who fear US sanctions for dealing with them, sometimes even after the goods have been delivered and cleared by customs. Obviously, this makes importing from China even harder for Russians. As such, while the West is not doing well in general, or the dollar this week as “Rate cuts!” fever builds, it’s clear that building a global dollar alternative is hard: if you can’t even do CNY-RUB trade now due to potential US sanctions, it’s back to bilateral (dollar-priced) barter, which isn’t efficient or scalable within a bloc. And for those who say gold as medium, that metal might hedge well vs. political inflation, but you can’t run sustained trade deficits with it, and both China and Russia (and most of the BRICS) want to run trade surpluses.

So, yes, we are stuck on the border: literally, in the US case, and much else; metaphorically in a US and global sense, where everything is shifting —don’t you tell me ‘bout your law and order– and November’s election will determine the Nietzschean “why” we are living/acting, allowing us a new “how” to achieve it – I’m tryin’ to change this water to wine.

Authored by Sam Dorman via The Epoch Times,

The Justice Department has intervened for former President Donald Trump, asking a federal court in Washington to dismiss a civil complaint brought over a clash between protestors and police that took place in the city following George Floyd’s death.

Black Lives Matter D.C. and others brought the original lawsuit in June 2020, just days after police used crowd control tactics in Lafayette Square before Trump was set to appear at a nearby church.

The case has seen court filings for years, with a group of plaintiffs filing an amended complaint in April this year.

On Aug. 19, the Department of Justice (DOJ) filed a notice that it was substituting itself for Trump because he was acting within the scope of his office that day.

Its decision was based on the Federal Tort Claims Act (FTCA).

In its notice, the DOJ said the law “provides that upon certification by the attorney general that a federal employee was acting within the scope of his office or employment at the time of the incident out of which the plaintiff’s claim arose, any civil action or proceeding commenced upon such a claim and arising under state law shall be deemed an action against the United States, and the United States shall be substituted as the defendant with respect to those claims.”

James G. Touhey, who leads the torts branch of DOJ’s civil division, certified that Trump “was an employee of the government acting in the scope of office or employment at the time of the incident out of which the plaintiffs’ claims arose.”

The amended complaint had named Trump in his individual capacity and requested damages. It alleged Trump was liable for intentional infliction of emotional distress, assault, battery, and negligence in purported violation of a district law surrounding free speech.

A separate motion to dismiss, also filed on Aug. 19, argued that the court lacked subject matter jurisdiction over the plaintiffs’ claims because they failed to exhaust administrative remedies.

It added that the plaintiffs had failed to show that their claims fell within the limited waiver of sovereign immunity offered by the FTCA.

The complaint alleged that the agencies involved with the suit had failed to respond within a six-month timeframe specified under the FTCA.

“Plaintiffs have therefore exhausted their administrative remedies under the FTCA,” the complaint read.

The DOJ’s actions came against the backdrop of broader controversy about Trump’s immunity and the federal government’s involvement in his legal battles.

Special Counsel Jack Smith prompted a legal battle that ultimately resulted in the Supreme Court establishing a landmark precedent on presidential immunity in July.

That case focused on criminal liability, but presidents have long enjoyed broad immunity from civil liability for actions that fall within the outer perimeter of their official duties.

In 2023, however, the U.S. Court of Appeals for the District of Columbia Circuit ruled the former president could not avoid civil liability in a suit from injured Capitol Police officers.

In that case, DOJ attorneys told the court that a president would not be protected by “absolute immunity” if his words were found to have been an “incitement of imminent private violence.”

Trump has denied wrongdoing associated with the U.S. Capitol breach on Jan. 6, 2021, and his attorneys said he didn’t intend to spark violence.

The DOJ had supported Trump in the lawsuit between him and writer E. Jean Carroll but reversed it in 2023.

In a July 11 letter to attorneys for Trump and Carroll, Principal Deputy Assistant Attorney General Brian Boynton said the DOJ could no longer conclude the former president was acting in his capacity as president when he made the allegedly defamatory statements about Carroll.

Russia on Wednesday says its anti-air defenses have successfully thwarted a major Ukrainian drone attack against the capital of Moscow, having shot down eleven inbound drones in total.

“The echeloned defense of Moscow against enemy UAVs made it possible to repel all attacks. This was one of the largest attempts to attack Moscow with the help of drones of all time,” Moscow Mayor Sergei Sobyanin said in a Telegram post early Wednesday morning.

Russia’s defense ministry said the effort to target the capital was part of a broader cross-border attack which included 45 drones total sent by Ukraine across different regions overnight, including:

• 11 shot down over the Moscow region

• 23 intercepted over the Bryansk region

• 6 over Belgorod,

• 3 over the Kaluga region 

• 2 over Kursk

Reuters noted that some of the drones were downed over the city of Podolsk, which lies some 24 miles south of the Kremlin. There have been no initial reports of injuries or damage due to the drone attack on the capital. Separately the governor of Bryansk, Alexander Bogomaz, cited a “mass” attack on his region which included all 23 drones intercepted.

Kremlin officials likely see this brazen attack on the capital as but a new extension of the Kursk incursion. While it’s certainly not the first drone attack on Moscow since the war began, it could mark the start of more consistent efforts to reach Moscow with UAVs. 

President Zelensky has meanwhile been busy demanding that the West lift all restrictions for using long-range missiles inside Russian territory.

Ukraine has assaulted the Russian capital on a few prior notable occasions. First, on May 3, 2023 a pair of explosive-laden drones targeted the Kremlin complex in what Russia called an “act of terrorism” and an assassination attempt. The drones were intercepted, but just barely, as one appeared to explode at the top of the Kremlin Senate dome. President Putin had not been present there at the time.

Another drone attack occurred in July 2023, when drones struck two buildings very near the Ministry of Defense headquarters. Another in November included a wave of 20 Ukrainian drone attacks on separate locations of Russia, some which tried to reach Moscow.

Ukraine, for its part, said it was also subject of a large-scale overnight drone attack which included 72 projectiles launched by Russia, most which were reportedly intercepted.

Ukraine’s military said 69 Iranian-design one-way drones targeted locations in Kyiv, Odesa, Kherson and Donetsk. Of these it said 51 drones were shot down; however, at least two Russian ballistic missiles made impact.

Moscow Mayor Sergey Sobyanin reports that all ten Ukrainian drones targeting Moscow were intercepted, marking the most massive drone attack in the city’s history. He says all of the drones were shot down while approaching the capital, neutralized by the city’s layered defense… pic.twitter.com/SSahnjWQxy

— Tymofiy Mylovanov (@Mylovanov) August 21, 2024

Meanwhile, former president Dmitry Medvedev, who serves as deputy head of Russia’s Security Council, has reiterated that the ongoing Kursk incursion means peace talks are impossible until Ukraine is completely defeated. “The empty chatter of intermediaries that no one had appointed about the wonderful peace is over. Everyone understands everything now, even though they do not say it out loud,” Medvedev wrote on Telegram.

He concluded his message in caps with: “There will be NO MORE NEGOTIATIONS UNTIL THE COMPLETE DEFEAT OF THE ENEMY!”