US Domestic Bank Deposits Drop For Second Straight Week

US Domestic Bank Deposits Drop For Second Straight Week

On the heels of a major deposit outflow the week before, and a huge (record) money-market fund outflow last week, all eyes are back on the banks again on Friday evening to see if this ‘flight’ continues as Tax-Day drags cash away from its comfy-5%-earnings-spots.

On a seasonally-adjusted basis, total US bank deposits declined for the second straight week (though only $2.4BN) after reaching back to pre-SVB levels…

Source: Bloomberg

And once again – like last week, and rather oddly giving the tax-day’ timing – non-seasonally-adjusted bank deposits rose $16BN, now well above pre-SVB levels…

Source: Bloomberg

Is some of the money-market cash being moved (temporarily) into bank deposits before heading out to tax man?

Source: Bloomberg

Historically, it appears NEXT week is when we see the Tax-Day decline in the NSA data…

Source: Bloomberg

Excluding foreign deposits, domestic bank deposits did fall on both an SA (-$2.9BN – large banks -$14.8BN, small banks +11.9BN) and NSA (-$12bn – large banks -$24BN, small banks +12BN) basis.

Source: Bloomberg

But, unlike last week when deposits dropped, we saw bank loan volumes rise (not fall) in the week ending 4/10 with large bank voilumes rising 0.65BN and small bank volumes rising $7.3BN…

Source: Bloomberg

Finally, as we detailed earlier, it appears the reality of bank reserves at The Fed is slowly (but surely) catching up with US equity market cap…

Source: Bloomberg

That’s going to get awkward in an election year…

Tyler Durden
Fri, 04/19/2024 – 16:44

via ZeroHedge News https://ift.tt/lutWcbm Tyler Durden

Down With Big Brother: Warrantless Surveillance Makes A Mockery Of The Constitution

Down With Big Brother: Warrantless Surveillance Makes A Mockery Of The Constitution

Authored by John and Nisha Whitehead via The Rutherford Institute,

“Whether he wrote DOWN WITH BIG BROTHER, or whether he refrained from writing it, made no difference … The Thought Police would get him just the same … the arrests invariably happened at night … In the vast majority of cases there was no trial, no report of the arrest. People simply disappeared, always during the night. Your name was removed from the registers, every record of everything you had ever done was wiped out, your one-time existence was denied and then forgotten. You were abolished, annihilated: vaporized was the usual word.”

– George Orwell, 1984

The government long ago sold us out to the highest bidder.

The highest bidder, by the way, has always been the Deep State.

What’s playing out now with the highly politicized tug-of-war over whether Section 702 of the Foreign Intelligence Surveillance Act gets reauthorized by Congress doesn’t just sell us out, it makes us slaves of the Deep State.

Read the fine print: it’s a doozy.

Just as the USA Patriot was perverted from its stated intent to fight terrorism abroad and was instead used to covertly crack down on the American people (allowing government agencies to secretly track Americans’ financial activities, monitor their communications, and carry out wide-ranging surveillance on them), Section 702 has been used as an end-run around the Constitution to allow the government to collect the actual content of your conversations (phone calls, text messages, video chats, emails and other electronic communication) without a warrant.

Now intelligence officials are pushing to dramatically expand the government’s spying powers, effectively giving the government unbridled authority to force millions of Americans to spy on its behalf.

Basically, the Deep State wants to turn the American people into extensions of Big Brother.

As Sen. Ron Wyden (D-Ore.) explains:

If you have access to any communications, the government can force you to help it spy. That means anyone with access to a server, a wire, a cable box, a Wi-Fi router, a phone, or a computer. So think for a moment about the millions of Americans who work in buildings and offices in which communications are stored or pass through.

After all, every office building in America has data cables running through it. The people are not just the engineers who install, maintain, and repair our communications infrastructure; there are countless others who could be forced to help the government spy, including those who clean offices and guard buildings. If this provision is enacted, the government can deputize any of these people against their will, and force them in effect to become what amounts to an agent for Big Brother—for example, by forcing an employee to insert a USB thumb drive into a server at an office they clean or guard at night.

This could all happen without any oversight whatsoever: The FISA Court won’t know about it, Congress won’t know about it. Americans who are handed these directives will be forbidden from talking about it. Unless they can afford high-priced lawyers with security clearances who know their way around the FISA Court, they will have no recourse at all.”

This is how an effort to reform Section 702 has quickly steamrollered into an expansion of the government’s surveillance powers.

We should have seen this coming.

After all, the Police State doesn’t relinquish power easily, the Surveillance State doesn’t look favorably on anything that might weaken its control, and Big Brother doesn’t like to be restricted.

What most Americans don’t get is that even without Section 702 in play, the government will still target the populace for warrantless, suspicionless mass surveillance, because that’s how the police state maintains its stranglehold on power.

These maneuvers are just the tip of the iceberg.

For all intents and purposes, we now have a fourth branch of government.

This fourth branch came into being without any electoral mandate or constitutional referendum, and yet it possesses superpowers, above and beyond those of any other government agency save the military.

It is all-knowing, all-seeing and all-powerful.

It operates beyond the reach of the president, Congress and the courts, and it marches in lockstep with the corporate elite who really call the shots in Washington, DC.

The government’s “technotyranny” surveillance apparatus has become so entrenched and entangled with its police state apparatus that it’s hard to know anymore where law enforcement ends and surveillance begins. They have become one and the same entity.

The police state has passed the baton to the surveillance state.

On any given day, the average American is now monitored, surveilled, spied on and tracked in more than 20 different ways by both government and corporate eyes and ears.

Every second of every day, the American people are being spied on by the U.S. government’s vast network of digital Peeping Toms, electronic eavesdroppers and robotic snoops.

Beware of what you say, what you read, what you write, where you go, and with whom you communicate, because it will all be recorded, stored and used against you eventually, at a time and place of the government’s choosing.

Privacy, as we have known it, is dead.

Whether you’re walking through a store, driving your car, checking email, or talking to friends and family on the phone, you can be sure that some government agency is listening in and tracking you. This doesn’t even begin to touch on the complicity of the corporate sector, which buys and sells us from cradle to grave, until we have no more data left to mine. These corporate trackers monitor your purchases, web browsing, Facebook posts and other activities taking place in the cyber sphere and share the data with the government.

Just about every branch of the government—from the Postal Service to the Treasury Department and every agency in between—now has its own surveillance sector, authorized to collect data and spy on the American people. Then there are the fusion and counterterrorism centers that gather all of the data from the smaller government spies—the police, public health officials, transportation, etc.—and make it accessible for all those in power.

These government snoops are constantly combing through and harvesting vast quantities of our communications, then storing it in massive databases for years. Once this information—collected illegally and without any probable cause—is ingested into NSA servers, other government agencies can often search through the databases to make criminal cases against Americans that have nothing to do with terrorism or anything national security-related.

Empowered by advances in surveillance technology and emboldened by rapidly expanding public-private partnerships between law enforcement, the Intelligence Community, and the private sector, police have become particularly adept at sidestepping the Fourth Amendment.

Talk about a system rife for abuse.

Now, the government wants us to believe that we have nothing to fear from its mass spying program because they’re only looking to get the “bad” guys who are overseas.

Don’t believe it.

The government’s definition of a “bad” guy is extraordinarily broad, and it results in the warrantless surveillance of innocent, law-abiding Americans on a staggering scale.

Indeed, the government has become the biggest lawbreaker of all.

It’s telling that even after it was revealed that the FBI, one of the most power-hungry and corrupt agencies within the police state’s vast complex of power-hungry and corrupt agencies, misused a massive government surveillance database more than 300,000 times in order to target American citizens, we’re still debating whether they should be allowed to continue to sidestep the Fourth Amendment.

This is how the government operates, after all: our objections are routinely overruled and our rights trampled underfoot.

It works the same every time.

First, the government seeks out extraordinary powers acquired in the wake of some national crisis—in this case, warrantless surveillance powers intended to help the government spy on foreign targets suspected of engaging in terrorism—and then they use those powers against the American people.

According to the Foreign Intelligence Surveillance Court, the FBI repeatedly misused Section 702 in order to spy on the communications of two vastly disparate groups of Americans: those involved in the George Floyd protests and those who may have taken part in the Jan. 6, 2021, protests at the Capitol.

This abuse of its so-called national security powers is par for the course for the government.

According to the Brennan Center for Justice, intelligence agencies conduct roughly 200,000 of these warrantless “backdoor” searches for Americans’ private communications each year.

No one is spared.

Many of the targets of these searches have done nothing wrong.

Government agents have spied on the communications of protesters, members of Congress, crime victims, journalists, and political donors, among many others.

The government has claimed that its spying on Americans is simply “incidental,” as though it were an accident, but it fully intends to collect this information.

As journalist Jake Johnson warns, under an expanded Section 702, U.S. intelligence agencies “could, without a warrant, compel gyms, grocery stores, barber shops, and other businesses to hand over communications data.”

According to the Wall Street Journal, “The Securities and Exchange Commission is deploying a massive government database—the Consolidated Audit Trail, or CAT—that monitors in real time the identity, transactions and investment portfolio of everyone who invests in the stock market.”

Journalist Leo Hohmann reports that the government is also handing out $20 million in grants to police, mental health networks, universities, churches and school districts to enlist their help in identifying Americans who might be political dissidents or potential “extremists.”

Ask the government why it’s carrying out this far-reaching surveillance on American citizens, and you’ll get the same Orwellian answer the government has been trotting in response to every so-called crisis to justify its assaults on our civil liberties: to keep America safe.

What this is really all about, however, is control.

What we are dealing with is a government so power-hungry, paranoid and afraid of losing its stranglehold on power that it is conspiring to wage war on anyone who dares to challenge its authority.

When the FBI is asking banks and other financial institutions to carry out dragnet searches of customer transactions—warrantlessly and without probable cause—for “extremism” indicators broadly based on where you shop, what you read, and how you travel, we’re all in trouble.

You don’t have to do anything illegal.

For that matter, you don’t even have to challenge the government’s authority.

Frankly, you don’t even have to care about politics or know anything about your rights.

All you really need to do in order to be tagged as a suspicious character, flagged for surveillance, and eventually placed on a government watch list is live in the United States.

As long as the government is allowed to weaponize its 360 degree surveillance technologies to flag you as a threat to national security, whether or not you’ve done anything wrong, it’s just a matter of time before you find yourself wrongly accused, investigated and confronted by police based on a data-driven algorithm or risk assessment culled together by a computer program run by artificial intelligence.

As I make clear in my book Battlefield America: The War on the American People and in its fictional counterpart The Erik Blair Diaries, it won’t be long before Big Brother’s Thought Police are locking us up to “protect us” from ourselves.

At that point, we will disappear.

Tyler Durden
Fri, 04/19/2024 – 16:20

via ZeroHedge News https://ift.tt/8COZcwL Tyler Durden

Tech Wrecks As FedSpeak F**ks FOMO-Followers; Gold Hits New Record High

Tech Wrecks As FedSpeak F**ks FOMO-Followers; Gold Hits New Record High

Well, that escalated quickly…

In a week characterized by data supporting ‘no landing’ from a growth perspective and disappointment from a disinflation perspective

Source: Bloomberg

This was reinforced by FedSpeak that was without exception – hawkish!

As they suddenly realized that all that ‘pivot’ optimism did nothing but dramatically ease financial conditions and fuck their ‘best laid plans’ for a rate-cut and soft landing…

Source: Bloomberg

Even the dove-est of the doves – Austan Goolsbee – bent the knee today:

“So far in 2024, that progress on inflation has stalled,” Goolsbee said Friday in remarks prepared for an event in Chicago.

“You never want to make too much of any one month’s data, especially inflation, which is a noisy series, but after three months of this, it can’t be dismissed.”

“Right now, it makes sense to wait and get more clarity before moving,” Goolsbee said.

And sure enough, rate-cut expectations for 2024 and 2025 have both plunged this week…

Source: Bloomberg

…and that has finally started to weigh on investors’ risk appetites (that’s a long way to catch down to reality)…

Source: Bloomberg

Most traders thought the worst was over last night as the panic-puke in futures was BTFD’d back to unchanged ahead of the cash open, but then the selling started (on Nasdaq) and never really stopped. On the day, Nasdaq was down over 2% while The Dow managed to gain 0.5%. Small Caps were almost unchanged by the end of the day with the S&P lagging…

But, all the majors ended the week red (with The Dow desperately trying to get back to even). Nasdaq was down over 5.5% on the week! S&P and Small Caps down around 3%…

Nasdaq is down for six straight days for its biggest weekly drop since Nov 2022, breaking below its 100DMA as CTA ‘sell threshold’s were crosed. Goldman’s trading desk noted:

The NDX now pacing for its worst week in over a year (down 6 of 7 weeks) as a complicated technical backdrop (CTAs, lower retail participation, NDX now testing 100-dma, seasonality), sideways earnings revisions thus far (ASML, TSM and even Sheridan’s NFLX EPS revisions were only 1-2% last night), a tense geopolitical backdrop (overnight headlines) and elevated positioning are testing conviction into a busy week of earnings … some debate if this all ‘helps’ the set-up into FAAMG prints or if the market is just read to ‘take a breather’ and sell any good news…”

The MAG7 basket broke below its 50DMA this week – the first time since October, when The Fed ‘pivoted’ and save the world. The market cap of the MAG7 is now down over $1 Trillion from its highs a week ago…

Source: Bloomberg

AI Leaders crashed relative to firms ‘at risk from AI’, plunging to their lowest in two months…

Source: Bloomberg

Of note is that the AI Leaders are perfectly back to their prior peak in 2021 (which was driven by chip demand for crypto mining and COVID disruptions), breaking down to the 100DMA and through the medium-term uptrend…

Source: Bloomberg

Semis were slaughtered this week…

Source: Bloomberg

NVDA plunged 10% today back to two month lows, closing below its 50DMA for the first time since Nov 2023…

… now in bear market (down over 22% from its highs) and the CSCO analog doesn’t look so crazy anymore…

Source: Bloomberg

Interestingly, amid all this carnage, banks had a decent week with WFC and MS outperforming (JPM still lagging from its drop on last Friday’s earnings)…

Source: Bloomberg

The Russell 2000, Nasdaq, and Dow are all back below their 100DMA, and the S&P 500 is pushing down towards its 100DMA (having blow thru the CTA ‘sell’ thresholds)…

Goldman’s trading desk warns, it could get worse: CTA supply is building – our team’s work shows this group sold $25B globally this week ($9B in SPX) with next week expected to bring another $27B globally (and $10B SPX) in a flat tape scenario.  Reminder the medium term threshold (aka most important) level is 4886 – less than 100 handles away from spot.”

Next week brings 43% of SPX set to report earnings highlighted by META/MSFT/GOOGL (aka $6.1T of mkt cap) reporting on Thurs night…on the macro front, key reports include 1Q GDP on Thurs & March PCE on Fri.

VIX soared this week to six-month highs, and credit markets also – finally – started to crack…

Source: Bloomberg

Treasury yields ended the week higher, but not before plunging overnight on  a flight-to-quality bid as Israeli missiles hit Iran, taking yields lower on the week. By the close of the week, the belly slightly underperformed but yields were all up by around 8-10bps….

Source: Bloomberg

The dollar rallied for the second straight week, hitting its highest since early Nov 2023 last night on the mid-east attacks before sliding back…

Source: Bloomberg

Heading into today’s ‘halving’ – likely to occur within the next few hours – Bitcoin was down, puking once again overnight on geopolitical chaos like it did last weekend, only to see buying come right back (after testing below $60,000 for the first time since early March)…

Source: Bloomberg

5.00% remains a key level for the 2Y Yield…

Source: Bloomberg

Despite two major attacks in the Middle East, oil prices ended lower for the second week in a row (well WW3 hasn’t started yet). Some knock-on effects from an evaporation of hope for demand-sponsoring rate-cuts also weighed on sentiment as WTI

Source: Bloomberg

Spot Gold prices spiked overnight on the Israel attack, pulled back, then rallied up to $2400 once again to close at the highs…

Source: Bloomberg

Gold closed the week at a new record high…

Source: Bloomberg

Silver soared 3% on the week to new cycle highs (its highest since Feb 2021)…

Source: Bloomberg

Silver has been broadly speaking outperforming gold in recent weeks after peaking at a gold-to-silver ratio of around 92x in January, it is ow down to 83 (still well above the 65x average since 1980… implying silver remains ‘cheap’ to gold)…

Source: Bloomberg

…and then there’s Cocoa…

Source: Bloomberg

And finally, are bank reserves at The Fed still the driving force for reality?

Source: Bloomberg

We saw the reality check from Aug-Oct last year; are we about to get another?

Tyler Durden
Fri, 04/19/2024 – 16:00

via ZeroHedge News https://ift.tt/1d2Wl4E Tyler Durden

Climate Worries Are Non-Credible, Luxury Beliefs That Harm Civilization Itself

Climate Worries Are Non-Credible, Luxury Beliefs That Harm Civilization Itself

Authored by Joakim Book via The Mises Institute,

I live in a small village at the edge of lands surrounded by very harsh nature. Those who occupied these valleys in ages past lived ruthlessly dangerous lives, where starvation was a constant worry, the sea just as often nurtured as it took away, and the winters were long and perilous. Nowadays, while I’m walking the desolate mountains or admiring the fierce storms from inside my nice, sheltered existence, echoing in my head is Thomas Hobbes’s descriptions of man’s precivilizational life: “Solitary, poor, nasty, brutish, and short.”

In the 2020s, we live fairly comfortable lives here, my fellow villagers and I. Our hearths are warm, our command over economic goods excellent. We live long, safe lives, where nobody starves and where almost nobody perishes in outbursts of nature’s wrath. We use machines—constructed far, far away using materials we don’t have, that run on fossil fuels that these lands don’t contain—to move away the snow that frequently and predictably lands on our doorsteps and otherwise would have made our roads impassable and our houses prisons. We use different machines—constructed far, far away using materials we don’t have, that run on fossil fuels that these lands don’t contain—to get ourselves out of our valley and transport goods and services back, including exotic fruits and vegetables that never grow here (certainly not in winter!).

It truly is fascinating to behold the astonishing things that globalized trade and capitalism can accomplish. Stepping back and thinking about the miracles of modern trade, innovation, and division of labor is so humbling.

Yet we well-off moderns worry about our collective existence to the point that kids have nightmares, and survey respondents overwhelmingly say climate change will end the human race.

Something like one-third of young people say they don’t want kids for fear of worsening the climate condition or how they’d fare in that brave, new world. “Climate anxiety is widespread among youth,” reports National Geographic. “How can we help kids cope with ‘eco-anxiety’?” asks the British Broadcasting Corporation. The vast majority of respondents in a global ten thousand–person study published in the Lancet in 2021 admitted to be very or extremely worried. Vox writers worry about the ethics of raising children. A new study, reported on by Phys.org, pointed to how many young people won’t have kids because of climate change: it’d be unfair to “bring a child into the world,” who’d have to live with the constant “feeling of impending doom, every day, for their whole life,” says one interviewed would-be parent.

Many of my fellow villagers entertain all these global ideas—melting glaciers and parts per million–numbers, floods and ethical dilemmas about us vulgar humans making earth inhospitable or uninhabitable.

It’s a strange thing to worry about obsessively, while the vicious storm raging outside the double-glazed windows affect nothing about our food supply, electricity use, heating, or ability to participate in the global division of labor—whether in our offices or remotely via high-speed internet. It somehow seems contradictory to passionately rally against capitalism from the comforts of very capitalistically built and maintained houses, hotels, and pubs; to inveigh against the burning of fossil fuels that literally keeps one alive.

It has me thinking about the action axiom, the starting point of Ludwig von Mises’s praxeology and the pillar-stone upon which Austrian economics rests. The colloquial version of this foundational Austrian maxim is “put your money where your mouth is” or “actions speak louder than words.” We demonstrate by our actions where our preferences and values lie; we reveal them to the world (act them into existence, really) when we do one thing instead of another, when we purchase one good instead of another, when we work instead of relax. All of this is wrapped in uncertainty and hopes and subjective human desires trading off against other such desires; in hindsight we can regret the choices we made. Still, says Murray Rothbard, a man’s “preferences are deducible from what he has chosen in action.”

Perhaps all this climate complaining is simply virtue signaling, in a world where feelings matter more than facts. The detachment from the physical processes of basic living—energy, materials, transportation, and in complicated monetary economies, money—has made many people ignorant, taking for granted the lifestyles we live and the standards of living we have. It has allowed us to start thinking foundational and civilization-carrying systems like money, fossil fuels, or commercial institutions are optional—a mere matter of ideological choice between good and evil people. They’re not.

I’m reminded too of luxury beliefs, a somewhat hyped concept coined by Rob Henderson, a psychologist at the University of Cambridge and author of the recent book Troubled. Henderson transfers Thorstein Veblen’s “conspicuous consumption”—the purchasing of expensive, often seemingly useless goods with the purpose of flaunting one’s wealth—to the moral and political domain. luxury belief, like a conspicuous good, is acquired in order to impress others, and is designed to “confer status on the upper class at very little cost, while inflicting costs upon the lower classes.”

Luxury beliefs don’t make much sense and don’t have staying power in the real world of atoms and temperature, of nature and starvation. But we’re so far detached from the world that physically supports us—so rich, so deluded, so well off—that we’re willing to believe (and by extension willing to experiment with) the very systems that uphold our existence.

Cue environmental concerns and anticapitalism.

Taken literally, enacting policies based on such follies into place, we’re on a path to horror and poverty, with brutish and short lives to follow.

The good news is that those systems are remarkably resilient and these voices might still be all “tawk,” as Nassim Taleb would say.

The popular energy-finance Substack Doomberg made a similar observation in February, listing two paragraphs’ worth of major events that happened from 1971: oil crisis, Iran-Iraq, Kuwait wars, Middle Eastern conflicts, the Asian and peso and ruble financial collapses, the terrorist attacks, Libya-Syria-Ukraine, the global financial crisis, and covid.

Through all of them, as tumultuous as they seemed at the time and as relevant as they remain in the political consciousness, the world’s total energy consumption is a straight line through all of it.

Here’s their graph:

BP Statistical Review global total energy consumption

Source: Doomberg

Socioeconomic events as radical as women’s rights or racial equality; left-wing or right-wing leaders; crises and recessions, inflations and boom years; generations of scholars and scientists and political movements . . . and there’s no impact on the basic thing that powers our civilization.

Eighty-five percent of the globe’s primary energy consumption comes directly from fossil fuels—the same it was over thirty years ago when I was born. You can speak beliefs about climate change, about noncredible, net-zero policy goals (always with years suspiciously ending in zero or five), about reducing reliance on fossil fuels, or about how “clean” renewable energy is. You can throw government money at it, pass laws, or pontificate in the high courts, legislative auditoriums, or the public square, but you’re just not changing that. You can’t change that.

Cypherpunks write code. Clever people ignore politicsYou should get out of the house, stop worrying too much about the lunatics running the asylum, and instead admire nature.

That’s what I’m doing.

Tyler Durden
Fri, 04/19/2024 – 15:43

via ZeroHedge News https://ift.tt/ZtFMWlO Tyler Durden

Nike “Permanently” Laying Off 740 Employees At World Headquarters

Nike “Permanently” Laying Off 740 Employees At World Headquarters

US athletic footwear and apparel company Nike announced late in the cash session on Friday that it is undergoing a restructuring effort to trim costs at its World Headquarters (WHQ) located in Beaverton, Oregon. 

Michele Adams, VP of People Solutions at Nike, might be the most hated person at the company this afternoon. In a letter to staff, she wrote that “approximately 740 employees at WHQ” will be “permanently” laid off by late June. 

“As a result of a second phase of impacts, which will take effect by June 28, 2024, approximately 740 employees at WHQ will have been impacted by this and the recent prior permanent reduction of the workforce,” Adams said. 

In December, Chief Executive Officer John Donahoe said the company would reduce its global headcount by 2% as management moves forward with a cost-savings program of as much as $2 billion over the next three years. 

Data from Bloomberg shows that Nike’s total headcount stood at around 83,700 as of the end of 2023. The company has been dramatically hiring over the last decade and a half – those efforts appear to have just stalled. 

Nike shares have stumbled into a correction as of late March. 

Yet another sign consumers are pulling back on clothing apparel and other sporting goods merchandise?

Tyler Durden
Fri, 04/19/2024 – 15:20

via ZeroHedge News https://ift.tt/H7WXQeS Tyler Durden

How Big Tech Is Consuming America’s Electricity And Water

How Big Tech Is Consuming America’s Electricity And Water

Authored by Kevin Stocklin via The Epoch Times (emphasis ours),

As federal net-zero policies attempt to shift transportation, heating, and other essentials onto the electric grid, one of the hottest growth sectors of America’s economy is poised to increase electricity demand exponentially, further straining an energy infrastructure that is being pushed into the red.

(Illustration by The Epoch Times, Getty Images, Shutterstock)

Data centers, the so-called “brains of the internet,” are industrial warehouses packed with rows upon rows of servers. They process, communicate, and store the data behind everything from bank records, online retailers, and social media platforms to Netflix shows and your personal iPhone videos.

Data centers are essential to cloud computing and its ability to give users remote access to data,” a 2023 Federal Reserve report states, quoting a Science article that calls them the “information backbone of an increasingly digitalized world.”

Many analysts laud data centers as one of the fastest-growing sectors of the real estate market, but the industry may soon find itself hitting a wall as local communities put up increasing resistance to the industry’s seemingly insatiable appetite for power and water.

“While other commercial real estate sectors are experiencing a decline in construction pipelines, data center development has reached an all-time high,” according to a January report by Newmark, a commercial real estate advisory.

“However, growth is increasingly constrained by land and power availability, supply chain challenges and construction delays, not to mention increasing resistance from some local jurisdictions.”

The report said the rapid growth of artificial intelligence (AI) and other technologies is fueling the demand.

The industry is led by cloud computing behemoths like Amazon Web Services (AWS), Microsoft Azure, Google Cloud, and Meta. It also includes digital landlords, called co-location companies, which rent storage space out to third parties. These include Equinix, Digital Realty, and CyrusOne.

Electricity Demand From Data to Double by 2030

Data warehouses consumed 17 gigawatts of electricity in 2022, or about 4 percent of total U.S. consumption. This is projected to double to 35 gigawatts by 2030.

Eric Woodell, who holds a doctorate of science in information systems and communications and is the founder of Amerruss, a tech infrastructure management company, referred to data centers as “energy hogs.”

But now your data center for AI applications is no longer a hog, it’s an elephant and it’s living in your backyard,” he told The Epoch Times.

Mr. Woodell has been managing data centers for 25 years, formerly for Vanguard, the world’s second-largest asset manager.

A mere 10-foot-square space within the average data center consumes about 10 times as much electricity as the average home, he said.

The NSA’s Utah data collection center has Salt Lake City in the background, in Bluffdale, Utah, on March 17, 2017. The $1.5 billion data center is thought to be the worlds largest

“While conventional data centers are already pulling an enormous amount of power, AI computing doesn’t use CPUs [central processing units], but GPU-based systems instead, as the GPUs [graphics processing units] are tailored to better handle complex mathematical functions,” he said. “But there’s a catch: they draw between five and 10 times more power than similarly equipped CPU systems.”

This hefty increase in electricity demand strains a grid that is already predicted to feature power shortages and routine rolling blackouts in the coming years. This is due to more demands being placed on the grid at a time when utilities are aggressively shutting down coal and gas plants in their transition to wind and solar energy.

According to a February case study of one large regional electric utility, PJM, by Quanta Technologies, the next several years will feature “equipment overloads that trigger as much as 6,826 MW of load shedding during average winter peak demand.”

Load shedding means cutting power to consumers, also known as blackouts, to prevent a system collapse.

PJM serves a dozen eastern Mid-Atlantic states as a wholesale provider.

“The analysis reveals the expected overload of 30 bulk transmission facilities (230 kV and higher) in the 2028 summer due primarily to high load growth associated mostly with new data centers,” the report states.

A man sits in the shade of his umbrella while dogs play in the park under high tension power lines in Redondo Beach, Calif., on Aug. 16, 2020. California has ordered rolling power outages as a heat wave strains its electrical system. (Apu Gomes/AFP via Getty Images)

Curiously, given that the transition to renewable energy is ostensibly to fight rising temperatures, the Quanta report finds that “electric demand is peaking less in summer and more in winter.” This is particularly worrisome as states on the West Coast and in the northeast, representing nearly one-third of natural gas consumers across the United States, are banning gas heating in new homes, forcing those households to rely on electricity for essential heating.

PJM forecasts new data center load growth of 7,500 MW by 2028, while deactivating 11,100 MW of fossil fuel production, leaving an 18.6 Gigawatt gap between new demand and remaining supply in this sector, according to Mr. Woodell.

“18.6 Gigawatts would power roughly 3 million homes or New York City three times over,” he stated. “The ramifications are massive.”

Data Center Alley

Globally, data centers consume about 3 percent of the world’s electricity, according to Ryan Yonk, an economist at the American Institute for Economic Research. This consumption tends to be steady and predictable, and utilities can expand to accommodate it, he said.

However, problems arise when centers become concentrated in a single area, especially if that area is transitioning away from fossil fuels.

“For individual communities, there are some real questions about data centers going in, particularly if they’re going to be clustered, and they often are,” Mr. Yonk told The Epoch Times.

Data centers end up having consistent power requirements, which means that the grid can be pretty well expanded so long as production capacity is high enough,” he said. “But as we transition more to renewables … the greater the baseline demand, the more problematic it can be.”

The region covered by PJM and the Quanta study is significant because it includes the world’s largest data hub, where about half of all U.S. data centers are located and through which an estimated 70 percent of the world’s internet traffic passes.

For anyone who conducts a Google search or makes an Amazon purchase, that transaction will likely be processed in what is known as Data Center Alley, home to about 150 data warehouses in Loudoun County, northern Virginia.

Data Center Alley had its beginnings in the 1980s when America Online (AOL) located its headquarters there. It quickly drew in others due to its proximity to Washington, its construction of the “world’s densest” fiber optic network, a supply of relatively cheap electricity, and local tax incentives.

This is the area where you want to locate to connect up to everything else,” Julie Bolthouse, director of land use at the Piedmont Environmental Council (PEC), told The Epoch Times.

“Everybody is building off of each other in these data centers; you have to think about it as one giant network that is all communicating with each other,” she said.

“What’s happened from the ‘90s to now is that we’ve supersized them. We’ve gone from a small building that was part of a larger business campus and was only five megawatts, to these hyper-scale warehouse-type buildings that are now 200,000 square feet, and they’re using up to 90 megawatts per building.”

For scale, 90 megawatts is about the electricity consumption of 22,000 homes, according to a PEC report.

Read more here…

Tyler Durden
Fri, 04/19/2024 – 15:00

via ZeroHedge News https://ift.tt/aFr1zwo Tyler Durden

Cocoa Hyperinflation Accelerates As Grindings Show No Demand Destruction 

Cocoa Hyperinflation Accelerates As Grindings Show No Demand Destruction 

Cocoa hyperinflation is insane. The latest data from the futures market shows that cocoa prices in New York surged above the $12,000 per ton level today as the pace of processing in factories remains robust. This indicates that demand destruction has yet to emerge despite the massive multi-month parabolic price surge. 

Cocoa futures surged 18% in the last two days to a record high of $12,125. Prices are up more than 190% year-to-date and are in breakout territory. 

Bloomberg says the news today about grindings—where cocoa transforms into butter and powder used in candy—only dropped 2% in Europe and marginally lower in Asia for the first quarter compared with the same quarter one year ago. 

Source: Bloomberg

John Goodwin, a senior commodity analyst at ArrowStream, said the grindings numbers are “nowhere near the deterioration we needed to end this rally,” adding, “It’s crazy how resilient those numbers were.”

In other words, despite cocoa prices skyrocketing to the moon, there has yet to be noticeable demand destruction among consumers that would derail this rally. 

“The market is watching processing data to get an idea of whether the rally is starting to hurt demand and how hard it’s becoming for chocolatiers to obtain beans, though the data risks becoming a less reliable gauge of demand as shortfalls make it more difficult to source cocoa,” Bloomberg pointed out. 

Paul Joules, an analyst at Rabobank, wrote in a note that grindings figures are “an indication that for now demand is holding up despite current pricing,” adding that “demand destruction will come, but clearly it’s taking longer to filter into grind data than the market was anticipating.”

Earlier this month, Bloomberg reported that famed commodity trader Pierre Andurand opened a “small, long position” in cocoa futures in early March. Since then, prices have erupted. In an email, he told the media outlet that his price target is “$20,000 later this year” amid worsening continued drought and disease across West Africa, denting production at cocoa farms. 

If cocoa prices rise, chocolate makers like the US Hershey Company will see demand destruction. However, this has yet to happen, and consumers are not complaining about higher prices (yet). 

On Google Search, we looked at various key phrases a consumer would ask online about why prices were rising. Still, there is no search trend explosion. 

However, as cocoa prices soar, the number of headlines about “chocolate prices” has hit a record high. 

Perhaps Andurand’s $20,000 price target is correct. Still, we have no idea where the price must go before demand destruction strikes. 

Tyler Durden
Fri, 04/19/2024 – 14:40

via ZeroHedge News https://ift.tt/lwC5qiF Tyler Durden

A Chart To Think About

A Chart To Think About

Authored by Peter Tchir via Academy Securities,

For all the “big tech”, momentum, hype; for all the “all-time highs”; this has not been a great year for tech…

Based on closing prices, the only day since January 19th, that you could have bought the Nasdaq 100 index and be profitable, is January 31st (and unless I type quickly, that might not even be true).

Had you came into the year long the Nasdaq 100, you would be up just over 2%.

Think about how many people got “FOMO’d” into buying markets at levels they weren’t comfortable with?

Now with yields rising, the Fed potentially on hold until after the election, valuation concerns mounting, and the “reaction function” to earnings, seems to be looking for negatives rather than positives, will people stay in this market?

Not great for 60/40 accounts and not sure when risk parity has to reduce exposures (they’ve been helped by commodities), but should be soon, if not already (changing correlations is as important for their models as individual asset class volatility – none going the “right” direction at the moment).

Finally, and for those who have been reading T-Reports for a long time, know that I like to say “flash crashes” and “massive overnight moves” are like criminals, they tend to return to the scene of the crime, which does not bode well for equity risk (and therefore credit risk – credit is moving due to that far more than anything wrong in credit fundamentals).

Tyler Durden
Fri, 04/19/2024 – 14:20

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Shocking Video Shows Man Engulfed In Flames Outside Trump Trial In NYC

Shocking Video Shows Man Engulfed In Flames Outside Trump Trial In NYC

Update (1440ET):

“Latest: A man lit himself on fire outside courthouse where Trump trial underway, NYPD officials brief within hour. CNN team on the ground observed one of the flyers – it said “NYU is a mob front” and had various allegations of wrongdoings against the school,” reports CNN’s Jim Sciutto. 

*   *   * 

A disturbing video has surfaced on X showing a man setting himself on fire outside the courthouse in Midtown Manhattan where former President Trump’s trial is taking place. 

CNN is reporting:  

The man walked into the park across the street from the courthouse, throwing flyers into the air, a senior law enforcement official told CNN. He then pulled something out of a backpack — it was not immediately clear what the item was — and lit himself on fire, the official said. 

The media outlet continued: 

Investigators are now fanning out to collect the flyers the unknown man threw into the air, another senior law enforcement official. A CNN team on the ground observed one of the flyers. It said “NYU is a mob front” and had various allegations of wrongdoings against the school.

The video is shocking. 

Why did a CNN reporter oddly declare that there was an active shooter? 

On X, Elon Musk asked: “Was he protesting against the trial or for it?” 

“It seems like Trump Derangement Syndrome is getting out of control,” X account Planet Of Memes said. 

There is the possibility the man could be protesting the Israel-Hamas war as protests have flared up nationwide—still no official report on why the man decided to light himself on fire.  

*Developing… 

Tyler Durden
Fri, 04/19/2024 – 14:07

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Freedom Caucus Posts Rotating Guard To Block Sneaky Leadership Moves

Freedom Caucus Posts Rotating Guard To Block Sneaky Leadership Moves

In a sign of growing discord among House Republicans, members of the Freedom Caucus are taking turns monitoring the House floor to prevent the GOP leadership from using sneaky procedural tactics to sap the power of increasingly rebellious conservatives.  

Specifically, they’re wary that party leaders and their allies will, without prior announcement, bring measures to the floor and seek their passage via “unanimous consent.” With that approach, the presiding officer simply states, “If there is no objection, the motion will be adopted.” After a pause to allow for objections, the officer declares, “Since there is no objection, the motion is adopted.”  

That’s where the Freedom Caucus’s Floor Action Response Team (yes, “FART”) comes in. With their round-the-legislative-clock presence, they always have a member positioned to object to unanimous consent motions, forcing proposals to go through a more arduous procedure. 

House conservatives both inside and outside the Freedom Caucus are increasingly irate over Speaker Mike Johnson’s actions, from pushing foreign aid for Ukraine, allowing omnibus spending bills that kick the fiscal can down the road, and personally casting the tie-breaking vote against adding a warrant requirement to the extension Foreign Intelligence Surveillance Act. All the while, he’s pushed border security to the back burner. 

The Freedom Caucus and its allies are on particular alert for moves that would reverse concessions made by Johnson’s predecessor, Kevin McCarthy, as part of his negotiations with conservatives pursuant to ascending to the speakership. For example, establishment Republicans could try to

  • Remove three conservatives from the powerful Rules Committee, which exerts a variety of controls over the flow of legislation through the House, and is therefore in position to expedite or thwart the progress of a bill. The targeted conservatives are Thomas Massie (KY), Chip Roy (TX) and Ralph Norman (SC), Politico reports.   
  • Raise the required number of members who must back a motion to oust the speaker before it can be put to a vote. Today, it only requires one. Last month, Georgia Rep. Marjorie Taylor Greene filed such a “motion to vacate the chair.”  On Tuesday, Massie announced he would co-sponsor the motion, telling Johnson to his face, “You’re not going to be speaker much longer.”  

After a tense meeting with Johnson, Florida Rep. Matt Gaetz, who introduced the successful motion to oust McCarthy, issued a public warning against changing the rules. “Talking about changing the threshold to the motion to vacate is likely to induce the motion to vacate,” he told reporters. 

Greene issued her own admonition: “Mike Johnson owes our entire conference a meeting. And if he wants to change the motion to vacate he needs to come before the Republican Conference that elected him and tell us of his intentions and tell us what this rule change … is going to be.”

Johnson has been deflecting questions about whether he was contemplating such a move, both with media and with Gaetz and others. When Gaetz was asked on Thursday if he would back a motion to vacate, he hinted that he was moving in that direction, coyly saying, “You know I woke up today and I didn’t.” At the same time, he said Johnson’s ouster would be “sub-optimal,” and that he’d prefer to see Johnson come around and “govern in accordance with the commitments we made.”  

Gaetz marveled at Johnson’s rapid conversion to establishment puppet once the gavel was in his hand:

“When we voted for Mike Johnson for speaker, he was fresh off of a vote against Ukraine aid, he was publicly advocating for a warrant requirement on FISA, and the central thesis of his campaign for speaker was single-subject spending bills…[Now] look where we are.”  

Tyler Durden
Fri, 04/19/2024 – 13:45

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