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The commercial real estate sector continues to experience elevated stress (see the state of the industry in charts). The latest crack to emerge is the increasing number of delinquencies on multifamily mortgages. 

In April, about 8.6% of commercial real estate loans bundled into collateralized loan obligations were distressed, reaching the record high set in January, according to Bloomberg, citing new data from analytics firm CRED iQ. 

The loans bundled into CRE CLOs were merged with funds from individual investors to acquire multifamily housing during the Covid era. After that, borrowing rates surged, catching many off guard. A significant portion of the deteriorating loans had floating-rate interest rates, putting massive pressure on landlords’ cash flows, diminishing the market worth of the properties, and obliterating equity in a large number of investments. 

According to data provider Trepp, $78.5 billion of CRE CLO loans are outstanding. This means many CRE CLO issuers are racing to find ways to prevent a tsunami of bad loans from defaulting or risk losing the fees they collect on the securities. 

Recent estimates from JPMorgan show lenders purchased $520 million of delinquent loans in the first quarter of this year. Lenders have been ramping up the number of buyouts over the last four quarters because of mounting bad loans in a period of elevated rates. 

JPMorgan strategist Chong Sin said he’s surprised by lenders’ ability to obtain warehouse lines to purchase bad debt, given tightening credit conditions. 

“The reason these managers are engaged in buyouts is to limit delinquencies,” Sin said, adding, “The wild card here is, how long will financing costs remain low enough for them to do that?”

Anuj Jain, an analyst at Barclays Plc, expects buyouts to continue as distress increases across the CRE CLO space.  

“If the outlook for the Fed shifts materially to hikes or no rate cuts for a while, that might lead to a sharp increase in delinquencies, which can stifle issuers’ ability to buy out loans,” Jain said. 

Bloomberg explains much of the CLO space derives from multifamily bridge loans originated around 2021-2022: 

CRE CLO issuance surged to $45 billion in 2021, a 137% increase from two years earlier, when buyers of apartment blocks sought to profit from the wave of workers moving to the Sun Belt from big cities. Three-year loans would give them time to complete upgrades and refinance, the thinking went.

Fast forward to today and the debt underpinning many of the bonds is coming due for repayment at a time when there’s less appetite for real estate lending, insurance costs have skyrocketed and monetary policy remains tight. Hedges against borrowing cost increases are also expiring and cost significantly more to purchase now.

Those blows helped increase multifamily assets classed as distressed to almost $10 billion at the end of March, a 33% rise since the end of September, according to data compiled by MSCI Real Assets.

Last Wednesday, the Fed left interest rates unchanged at around 550bps as inflation data reaccelerates and economic growth tilts to the downside, stoking stagflation fears. 

Fed swaps are pricing in just under two cuts – this is down from nearly seven earlier this year and about 1.14 before last week’s FOMC. 

Meanwhile, bears are piling in on CRE CLO issuer Arbor Realty Trust Inc., with 40.3% of the float short, equivalent to 73 million shares short. 

“The multifamily CRE CLO market was not prepared for rate volatility,” said Fraser Perring, the founder of Viceroy Research, which has placed bear bets against Arbor, adding, “The result is significant distress.” 

The longer the Fed delays rate cuts, the worse the CRE mess will get. 

By James Crombie, Bloomberg Markets Live writer and strategist

Wafer-thin spreads on corporate debt don’t matter — until they do. There are several potential triggers for risk premia to flare, denting credit portfolios.

Spreads have collapsed across the board, from investment-grade and junk bonds to collateralized loan obligations. The extra yield investors get for owning US high-grade corporate debt instead of government bonds is the lowest in two-and-a-half years.

At less than 90 bps, that’s far below the five-year average of about 120 bps. As a percentage of all-in yield, it’s the least since 2007.

Such narrow risk premia reflect booming demand for limited net new supply of corporate bonds, plus a general lack of concern about the macroeconomic outlook. And since the Federal Reserve bailed out corporate bonds during Covid, there’s a perceived central bank backstop underpinning the debt.

Buyers have been lulled into thinking this is the new normal, but such a paltry yield pickup doesn’t adequately reflect rising corporate credit risk. So when volatility returns to jolt investors from their slumber, expect credit risk premia to flare, slamming portfolios.

Credit typically tracks broad measures of volatility, with spreads widening when markets get choppy. But since December, when corporate bond buyers were bulled up on the idea of six 2024 rate cuts and a soft landing in the US, they’ve diverged.

There are eerie similarities with the period just before the global financial crisis — not least high-grade spreads and bond yields at around the same levels. After that particular bubble popped, investment-grade risk premia spiked above 600 bps.

Other credit blow-ups occurred during the 2011 European sovereign debt crisis, a 2016 rout in the banking sector and oil prices, as well as during the global economic shutdown when the coronavirus spread in 2020.

War, geopolitics and elections are reasons to believe the VIX Index will rise closer to its five-year average above 20, from less than 14 currently. That should rattle credit investors, who are increasingly exposed by accepting less cushion for rising risk.

In addition, credit’s vulnerable to a sustained exodus of funds fleeing negative returns — high-duration corporate bonds lose money when yields rise — in search of better options at more generous yield spreads. Plus there’s the threat of policy error — or even a hike — from the Fed, and a US recession can’t be ruled out. Both would throw debt portfolios for a loop.

Credit’s set up for a fall after rallying hard at the end of 2023. Investment-grade US bonds booked the best returns since 2008 in November and December, when investors raced to price in a whopping six rate cuts for this year. Barely any of that’s been given back — even as those dovish hopes have crumbled.

Ironically, the only place credit investors appear to have exercised some caution is in the very junkiest debt, which is most likely to inflict pain as rates stay high for longer. Risk premia on bonds rated CCC have tightened 60 bps this year, or 8%. That compares with a 13% contraction in high grade.

Of course, a steady US economy is good fundamental news for borrowers and a strong bid for yield provides support. But earnings are eroding — particularly at financials, which are 30% of the market — and interest-coverage ratios are creeping up as high-for-longer rates take their toll, even on better-quality borrowers.

Spreads may well grind even tighter as fat yields juice demand for limited net supply of new bonds. But that’ll only magnify the scale and pace of the inevitable flare up when volatility spikes and credit reverts to something more closely resembling long-term averages.

US natural gas prices broke their longest monthly losing streak since 2020. This comes after an El Niño winter swept across the Lower 48, causing demand to dwindle and storage levels to surge, sending prices spiraling lower in recent months. However, now there are signs a bottom is forming in NatGas markets.

April printed the first monthly gain since October, up nearly 13%, breaking the longest losing streak in more than four years. 

Between mid-February and late April, prices were floored around $1.50/MMBtu with resistance around the $2 mark. Since last week, prices have surged above $2.

One reason for the bullish price action is that the market expects warmer weather across the Lower 48. Peak summer is mid-July, and this is the point when households and businesses crank up air conditioning, which ignites power demand from NatGas-fired power plants. 

FXStreet noted the prices are also rising today due to a higher war risk premium as “Israel is starting offensive in Rafah.” 

Warmer weather will help draw down on the record NatGas storage in the US. The end of the withdrawal season was:

• 2019: 1.107 trillion cubic feet (tcf)
• 2020: 1.986 tcf
• 2021: 1.750 tcf
• 2022: 1.386 tcf
• 2023: 1.830 tcf
• 2024: 2.259 tcf

The 2.259 tcf figure is the highest inventories in years for the US, specifically due to mild winter weather.  

On Monday, Goldman’s Samantha Dart gave clients a snapshot of NatGas fundamentals in the US. The big takeaway is elevated storage but declining production due to ongoing maintenance. 

Dart notes that the power demand for NatGas remains elevated. 

In a separate note last week, Dart said increasing power demand for data centers “might not change much for US gas prices.” 

The good news for US NatGas prices is that LNG exporting capacity is expected to ramp up next year. 

NatGas prices have likely bottomed. 

Authored by J. Peder Zane via RealClearPolitics,

Journalism may indeed be the first draft of history but that old chestnut can be misleading. Where it suggests a set-in-stone version of events, that first draft is really an unfolding detective story, revised and rewritten as we dig out better answers to the eternal questions of who, what, when, where, and how.

Two of my colleagues at RealClearInvestigations – Aaron Maté and Paul Sperry – recently recast one of the biggest stories of our time: America’s long, strange, and destructive entanglement with Ukraine.

As with all great investigative journalism, Maté and Sperry draw on a wide range of documents and insider accounts to reveal facts the powers-that-be have tried to conceal. While President Biden and many other leaders from both parties cast Ukraine as a bastion of democracy and a beacon of freedom, Maté and Sperry reveal how a decade of anti-democratic interference by Biden and other U.S. officials has led that country to the brink of destruction while corrupting America’s domestic politics.

Their reporting shows that Ukraine is not an independent democracy but a client state of America which has pushed Ukraine into ever-deepening conflict with Russia. It does not excuse Vladimir Putin’s illegal and murderous invasion of Ukraine in 2022, but it shows the massive escalation in a decade-long proxy war the two powers have been conducting on another nation’s soil.

Although this conflict stretches back decades and even centuries, Maté’s April 30 article starts in 2013. That’s when an uprising known as the Maidan movement was percolating in opposition to Ukraine’s notoriously corrupt president, Viktor Yanukovych, who had delayed signing a trade pact with the European Union because he did not want to alienate Russia.

The Maidan movement was soon co-opted by ultra-nationalist groups, some of whose members “openly sported Nazi insignia.” But many American officials, including then-Vice President Biden, saw it as an opportunity to pull Ukraine from the influence of Russia and to undermine Putin.

High-ranking U.S. officials – including senior State Department official Victoria Nuland and U.S. Ambassador Geoffrey Pyatt – actively advised the movement, which staged a coup in 2014 by storming the Ukrainian parliament. Those same American officials were also involved in naming the new government.

Putin immediately moved to counter growing American influence on his border. Just days after the coup, Russia invaded and soon annexed Crimea. Russophile Ukrainians in the eastern Donbas region followed suit. While Putin publicly told the Donbas forces to seek a diplomatic solution to their claims, American officials, including then-CIA Director John Brennan pushed Ukraine’s new government to armed conflict. As Maté wrote, Ukraine then “descended into a full-scale civil war. Thousands were killed and millions displaced in the ensuing conflict.”

As Putin issued threats that eventually turned into war, the U.S. tightened its grip on Ukraine. U.S. officials, including Biden, vetted appointments and dismissals in Kyiv, shaping, Maté reports, “the personnel and policies of subsequent Ukrainian governments, all while expanding its military and intelligence presence in Ukraine via the CIA and NATO.”

Sperry’s April 17 article changes our understanding of one of the most famous and consequential examples of U.S. meddling – Biden’s December 2015 threat to withhold $1 billion in aid if Ukraine did not fire its top prosecutor, Viktor Shokin. It has long been known that Shokin had launched multiple investigations into Burisma Holdings, the corruption-riddled energy giant that was paying Biden’s son Hunter millions of dollars. After Shokin was fired, those probes went away.

After this quid pro quo came to light, the Obama administration said that Biden was just carrying out the policy wishes of our government and its European allies. Sperry’s reporting, however, indicates that the U.S. had no such concerns about Shokin in the months before Biden’s threat: “An Oct. 1, 2015, memo summarizing the recommendation of the Interagency Policy Committee on Ukraine stated, ‘Ukraine has made sufficient progress on its [anti-corruption] reform agenda to justify a third [loan] guarantee.’”

Sperry also reports that one Biden advisor at the time was especially surprised by his boss’s action – Eric Ciaramella. On Jan. 21, 2016, Ambassador Pyatt emailed Ciaramella and other White House aides an article from the Ukrainian press – “U.S. loan guarantee conditional on Shokin’s dismissal.”

“Yikes,” Ciaramella responded. “I don’t recall this [the firing] coming up in our meeting with them,” he said, referring to an earlier White House meeting he hosted with top Ukrainian prosecutors.

The backstory Sperry brought to light would take on new significance three years later, when Ciaramella sparked Donald Trump’s first impeachment by complaining that the president had allegedly tried to condition Ukraine aid on an announcement that it was looking into Biden family corruption in that country – as well as Ukraine’s well documented efforts to interfere in the 2016 election in support of Hillary Clinton.

Sperry’s reporting suggests that the Trump impeachment was part of an effort to cover up Biden’s attempt to shield his family from the law. The strategy might have worked but for a strange stroke of fate, with the surfacing of a laptop Hunter Biden abandoned at a Delaware repair shop that detailed his family’s high-level influence peddling.

As Ukraine – a mid-sized country halfway around the world – played a key role in our 2016 and 2020 elections, so it promises to do the same in 2024. At first glance, its prominence seems amazing. Maté and Sperry, in far greater detail than I have summarized here, help us understand why.

Their dispatches are far from the last word. Future reporting will find still undiscovered facts, providing, one hopes, a clear sense of the past as it becomes history. Their work is also achingly relevant to the president as we witness the carnage in Ukraine. As Maté writes, “In claiming to defend Ukraine from Russian influence, Ukraine was subsumed by American influence” at incalculable cost.

Their reporting also reveals the tangled complexity of human affairs requires a healthy amount of cognitive dissonance. America’s support for Ukraine may be a necessary defense against Putin’s aggression. But it is also a recurrence of our long and now largely disavowed history of promoting regime change for seemingly noble reasons in far-flung corners of the world such as Guatemala, Iran, South Vietnam, Chile, and other places. It is not the role of journalists to resolve this tension, but, as Maté and Sperry have, to detail it without fear or favor, so that others might.

In 2023, solar energy accounted for three-quarters of renewable capacity additions worldwide. Most of this growth occurred in Asia, the EU, and the U.S., continuing a trend observed over the past decade.

In this graphic, Visual Capitalist’s Bruno Venditti illustrates the rise in installed solar photovoltaic (PV) capacity in China, the EU, and the U.S. between 2010 and 2022, measured in gigawatts (GW). Bruegel compiled the data..

Chinese Dominance

As of 2022, China’s total installed capacity stands at 393 GW, nearly double that of the EU’s 205 GW and surpassing the USA’s total of 113 GW by more than threefold in absolute terms.

Since 2017, China has shown a compound annual growth rate (CAGR) of approximately 25% in installed PV capacity, while the USA has seen a CAGR of 21%, and the EU of 16%.

Additionally, China dominates the production of solar power components, currently controlling around 80% of the world’s solar panel supply chain.

In 2022, China’s solar industry employed 2.76 million individuals, with manufacturing roles representing approximately 1.8 million and the remaining 918,000 jobs in construction, installation, and operations and maintenance.

The EU industry employed 648,000 individuals, while the U.S. reached 264,000 jobs.

According to the IEA, China accounts for almost 60% of new renewable capacity expected to become operational globally by 2028.

Despite the phasing out of national subsidies in 2020 and 2021, deployment of solar PV in China is accelerating. The country is expected to reach its national 2030 target for wind and solar PV installations in 2024, six years ahead of schedule.

Authored by Naveen Athrappully via The Epoch Times (emphasis ours),

Individuals who took COVID-19 vaccines were found to have later suffered from psychosis, with Pfizer and AstraZeneca shots linked to most of the cases.

The peer-reviewed systemic review, published in the Frontiers in Psychiatry journal on April 12, examined cases of new-onset psychosis among people who took the vaccines. Psychosis refers to symptoms that occur when an individual has difficulty differentiating between reality and fantasy, with hallucinations and delusions being two key types. The review looked at 21 articles describing 24 cases of psychosis symptoms following vaccination. The researchers concluded that “data suggest a potential link between young age, mRNA, and viral vector vaccines with new-onset psychosis within 7 days post-vaccination.”

“Collecting data on vaccine-related psychiatric effects is crucial for prevention, and an algorithm for monitoring and treating mental health reactions post-vaccination is necessary for comprehensive management.”

Out of the 24 cases, 13 were female. The median age of participants was 36 years. Twenty-two patients (91.2 percent) had no specific history of somatic illness and comorbidities.

In 33.3 percent of the cases, administration of the Pfizer mRNA vaccine “potentially induced adverse psychiatric events,” the study said. The viral vector AstraZeneca vaccine was linked to psychotic symptoms in 25 percent of cases.

In 45.8 percent of incidences, psychotic symptoms were reported after the first shot and in fifty percent after the second dose.

“Almost all reviewed cases (95.8 percent) presented with psychotic symptoms, such as hallucinations (visual, auditory, olfactory, and tactile) and delusions (mostly persecutory and delusions of reference).”

The most common form of hallucination was auditory, experienced in 54.2 percent of the cases, while visual hallucinations were experienced by 12.5 percent of patients.

“Motor disturbances, such as increased or decreased motor activity and bizarre behavior, were mentioned in 83.3 percent of cases. In 3 (12.5 percent) cases, a suicidal attempt was described.”

The psychotic symptoms mostly lasted for a period of one and two months.

The patients were treated using various methods including antipsychotics and steroids, but only 12 out of the 24 made a full recovery. The remaining suffered from “residual symptoms such as decreased emotional expressions, low affect, or residual psychotic symptoms.”

In one case, the patient reported a positive COVID-19 test result. “Previous studies have shown that individuals with documented comorbidities and a history of COVID-19 infection exhibit a statistically significant increase in adverse events following vaccination,” the study noted.

Researchers speculated that inflammatory conditions following vaccination may be a reason behind the psychosis. The study found elevated C-reactive protein levels and mild to moderate leukocytosis—high white blood cell count—as the most common blood abnormalities. Both conditions have links with inflammation.

Another hypothesis suggested in the study was that post-vaccination psychosis could suggest a manifestation of autoimmune anti-NMDA encephalitis, a condition in which the immune system targets the brain neurons by mistake and causes inflammation.

Researchers noted that instances of anti-NMDA encephalitis have been repeatedly reported after vaccinations against infections like influenza, pertussis, yellow fever, and typhus.

“Considering the potential link between post-vaccination psychosis and autoimmune anti-NMDA encephalitis, it is advisable to consider immunological screening in individuals presenting psychiatric symptoms post-COVID-19 vaccination.”

A third possible reason suggested in the study is that the various speculations and uncertainties regarding the safety of COVID-19 vaccines could lead to people experiencing “significant stress,” which could end up triggering the development of psychiatric reactions.

The authors received financial support for the review, with the article-processing charge funded by Riga Stradins University, Latvia. Researchers declared no conflicts of interest in the study.

Post-Vax Psychosis Cases

Episodes of psychosis after taking COVID-19 shots have been detailed in several case studies. In one instance, a 15-year-old boy from Taiwan was sent to hospital two days after taking the second Pfizer shot. He was screaming and exhibiting agitation and uncontrollable limb stretching.

Other bizarre behaviors included sitting up and lying down frequently. The child was prescribed antipsychotics yet his behaviors continued to persist after being discharged for more than a month.

The doctors then put the boy under a steroid regimen, which is anti-inflammatory and helps calm down an overactive immune system. His symptoms then improved.

In another case from Brazil, a woman in her 30s, who was previously healthy, developed refractory psychosis within 24 hours of taking an mRNA COVID-19 shot. The woman had disorganized thoughts, was aggressive, and believed she was being persecuted at the hospital.

Even though she was treated with mood stabilizers and antipsychotics, her behavior showed improvements only after four months of hospitalization. However, her psychosis continued.

A May 2022 review described the case of an 18-year-old woman who developed psychotic symptoms on the same day she took the first dose of AstraZeneca vaccine.

“Symptoms started few hours after the vaccination with irrelevant talk. Over the next three days, it progressed to irritability, delusions of persecution and reference, and visual hallucinations.”

Another case study detailed the situation of a 45-year-old woman with no family history or personal history of mental disorders who ended up developing psychosis a month after she received a COVID vaccine. She quit her 18-year-old job abruptly and displayed erratic behaviors.

50 media professionals were killed due to their journalistic activities in 2023, according to the Reporters Without Borders (RSF) database.

As Statista’s Anna Fleck reports, by far the deadliest place for journalists last year was in the Palestinian territories, where 16 deaths were counted in just the last three months of the year.

You will find more infographics at Statista

Following some way behind were Mexico with four deaths reported there in 2023, three in Afghanistan, three in Bangladesh, three in Lebanon, and two deaths in Cameroon, Ukraine and the Philippines, respectively.

A single journalist was also killed in each of the following countries: Albania, China, Colombia, Honduras, India, Lesotho, Mali, Mozambique, Paraguay, Rwanda, Somalia, Sudan, Syria and the United States. Meanwhile, 109 people were listed as having “disappeared” last year, with the highest numbers recorded in Mexico (34), Syria (9), Russia (6), Pakistan (6), the Democratic Republic of Congo (5) and Kosovo (5).

It is important to note here that media professionals’ deaths are only listed here if confirmed by the RSF as being linked to their journalistic work. This explains why these figures seem low and that they are subject to change as fact-checking is carried out.

Authored by John Cody via ReMix News,

Rejection of immigrants from Islamic countries has increased in Germany, according to the latest Insa poll commissioned by the Nius media group.

The most recent survey shows an absolute majority of 52 percent rather agree with the statement that “Germany should generally no longer accept refugees from Islamic countries”. Only 34 percent say “disagree” or “tend to disagree” with this statement.

There is even greater agreement with the statement that “in certain areas of my town or village, I have the feeling that I am no longer in Germany.” According to the poll, 57 percent agree with the statement, while 36 percent do not share this feeling.

The poll further shows that 54 percent of respondents said they were “afraid that Germans will become a minority in Germany.” On the other hand, 37 percent said they were not concerned.

A relative majority supports the theory behind the Great Replacement, which the domestic intelligence agency the Office for the Protection of the Constitution (BfV) classifies as a “right-wing extremist” viewpoint.

According to the poll, 45 percent of respondents agree with the statement: “I believe that Europeans are gradually being replaced by immigrants from Africa and the Middle East.”

A smaller number of people, 41 percent, reject this statement.

WATCH: “I don’t have to become a minority in my own country.” @EvaVlaar says Whites are being replaced in their native countries. Here is the actual data behind her claims, which shows rapid demographic change in the West’s biggest cities. pic.twitter.com/rot877Xe8Z

— Remix News & Views (@RMXnews) April 29, 2024

Racism against Whites

Two-thirds of Germans (65 percent) agree with the statement that there is “racism against Whites” in Germany, while only a small minority of 22 percent think this is not true.

A strong majority also believe integration has not worked, with 58 percent saying “no” to the question of whether “migrants have largely integrated well in Germany.” Only 29 percent of respondents say migrants have integrated well.

Immigrants burden the German school system

An overwhelming majority of Germans agree with the statement that “the current migration is overburdening the German school system.” The results show that 75 percent, or three-quarters, agree with this statement, while 22 percent say they do not see a problem.

Remix News has previously reported on the problems facing the country’s school system, which is increasingly made up of an immigrant population, and in some cities, even constitutes the majority of students. Teachers and principals face assault, classroom overcrowding, language difficulties, and aggressive clashes between minority groups.

The survey follows a series of polls that show Germans are rapidly souring on mass immigration. Currently, the most popular party among German youth is the anti-immigration Alternative for Germany (AfD) party while the AfD is now the second most popular party in the country, even if the party’s overall support has seen a slight drop of between 3 to 4 points over the last three to four months.

Just this week, approximately 1,000 Muslims belonging to a radical pro-Sharia group marched in Hamburg to call for a caliphate in Germany, sparking national headlines and a sharp debate about the country’s growing Muslim population. Last month, it was reported that the share of foreigners committing crimes in the country had hit a record high of 41 percent.

Read more here…

Authored by Ryan Morgan via The Epoch Times,

The San Diego County government is suing the manufacturer of a computer numerical control (CNC) machine, alleging that it is being used to manufacture unserialized firearms parts.

The lawsuit, filed on behalf of the county by the gun-control legal advocacy group Giffords Law Center, alleges the “Coast Runner” CNC machine, marketed by Coast Runner Industries, Inc., is simply a rebrand of the “Ghost Gunner” CNC machine previously developed and marketed by Defense Distributed and Ghost Gunner Inc.

Gun rights activist and technologist Cody Wilson has been working for years against gun control efforts by expanding access to the tools necessary to produce firearms at home. He has used his non-profit, Defense Distributed, as a platform to pioneer technological advancements in the manufacture of firearms using both 3D-printing and CNC technology.

Individuals are not prohibited under federal rules and regulations from producing firearms for their personal use, but gun control proponents in several states have sought to prevent the proliferation of unserialized privately-made firearms, which they’ve referred to as “ghost guns.”

While gun control advocates have attempted to stop the spread of “ghost guns,” Mr. Wilson and Defense Distributed have worked to ensure home manufacturing of firearms remains accessible with the development of its “Ghost Gunner” line of CNC machines.

California Law and CNC Machines

In 2022, the Democrat-supermajority California legislature passed legislation that makes it unlawful to sell or transfer any “CNC milling machine that has the sole or primary function of manufacturing firearms to any person in this state, other than a federally licensed firearms manufacturer or importer.”

Following the passage of the 2022 law, the Ghost Gunner sales website states, “Ghost Gunner CNC machines are not currently available to non-FFL California customers.” But after Defense Distributed and Ghost Gunner restricted sales of its machines in California, a new company called Coast Runner emerged, marketing a similar CNC machine.

The new lawsuit names Coast Runner Industries Inc., Ghost Runner Inc., and Defense Distributed as defendants.

“The ‘Coast Runner’ and the ‘Ghost Gunner’ share more than just similar rhyming names. The ‘Coast Runner’ is in fact the Ghost Gunner with a new coat of paint,” the San Diego County lawsuit states.

“It has the same internal designs, the same features, and is being marketed for the same purpose: the illegal production of untraceable ghost guns. Moreover, it is being sold and marketed by the same company, as public records show that Coast Runner Industries, Inc. is merely an alter ego of Ghost Gunner Inc. and Defense Distributed.”

A marketing video for the latest iteration of the “Ghost Gunner” CNC machine shows it being used for what appear to be firearm frames and receivers, and the sales website for the machine makes clear that it is “optimized for machining AR-15 and AK-47 receivers.” By contrast, marketing videos and materials for the “Coast Runner” emphasize its cutting power and precision.

San Diego County’s legal complaint notes that the “Coast Runner” made an appearance earlier this year at the Shooting, Hunting, and Outdoor Trade (SHOT) show, a trade show hosted by the National Shooting Sports Foundation (NSSF).

The lawsuit also notes that individuals who previously worked with Ghost Gunner and Defense Distributed have gone on to work with Coast Runner Inc.

“Defendants flout California law with too-cute-by-half sales and marketing tactics. The Coast Runner is not a joke-it is an illegal device designed, marketed, and sold to enable its users to make firearms and to violate California’s gun violence prevention laws,” the complaint states.

“Plaintiff brings this suit to put an end to Defendants’ flagrant violations of California law and to seek remedy for the harm Defendants have caused and are continuing to cause in California.”

California ‘Doesn’t Have the Nerve to Ban CNC’: Wilson

The legal complaint seeks a judgment finding all defendants to be in violation of California law and seeks a civil penalty of as much as $25,000 per alleged violation of the California law prohibiting sales of CNC machines for firearms manufacturing, along with an award of “reasonable damages” to the state.

Mr. Wilson insisted Defense Distributed remains in compliance with California law.

“Defense Distributed follows California law with great effort,” he told NTD News in an emailed statement.

“The state doesn’t have the nerve to ban CNC, so they ban speech about the technology.”

Mr. Wilson declined to offer further comment on the lawsuit as he and his legal team prepare to respond.

NTD News also contacted Coast Runner for comment, but did not receive a response by press time.

In this graphic, Visual Capitalist’s Marcus Lu ranked the top 20 countries by their amount of debt to China. These figures are as of 2022, and come from the World Bank (accessed via Yahoo Finance).

This dataset highlights Pakistan and Angola as having the largest debts to China by a wide margin. Both countries have taken billions in loans from China for various infrastructure and energy projects.

Critically, both countries have also struggled to manage their debt burdens. In February 2024, China extended the maturity of a $2 billion loan to Pakistan.

Soon after in March 2024, Angola negotiated a lower monthly debt payment with its biggest Chinese creditor, China Development Bank (CDB).

Could China be in Trouble?

China has provided developing countries with over $1 trillion in committed funding through its Belt and Road Initiative (BRI), a massive economic development project aimed at enhancing trade between China and countries across Asia, Africa, and Europe.

Many believe that this lending spree could be an issue in the near future.

According to a 2023 report by AidData, 80% of these loans involve countries in financial distress, raising concerns about whether participating nations will ever be able to repay their debts.

While China claims the BRI is a driver of global development, critics in the West have long warned that the BRI employs debt-trap diplomacy, a tactic where one country uses loans to gain influence over another.

Editor’s note: The debt shown in this visualization focuses only on direct external debt, and does not include publicly-traded, liquid, debt securities like bonds. Furthermore, it’s worth noting the World Bank data excludes some countries with data accuracy or reporting issues, such as Venezuela.

If you enjoyed this post, check out our breakdown of $97 trillion in global government debt.