Senate Votes Unanimously To Declassify COVID-19 Wuhan Lab Leak Intelligence

Senate Votes Unanimously To Declassify COVID-19 Wuhan Lab Leak Intelligence

Authored by Caden Pearson via The Epoch Times,

A pair of Republican senators on Wednesday night declared the U.S. Senate had unanimously passed their bill requiring the Biden administration to declassify intelligence related to the origins of COVID-19.

The bill, known as the COVID-19 Origin Act of 2023, specifically aims to investigate the possibility that the SARS-CoV-2 virus, which causes COVID-19, leaked from a lab in Wuhan, China.

Republican Sens. Mike Braun and Josh Hawley reintroduced the bill on Monday after the Department of Energy (DOE) provided a classified intelligence report to the White House and certain members of Congress, which concluded that the COVID-19 pandemic most likely arose from a lab leak. The FBI had previously come to a similar conclusion.

Sen. Sherrod Brown (D-Ohio) made a request for unanimous consent of the bill, which was granted “without objection.” Unanimous consent enables a bill to pass without a recorded vote.

“Tonight the Senate UNANIMOUSLY passed my bill to declassify all the intelligence the government has on #covid origins. Let the people see the truth!” Hawley wrote on Twitter.

In further comments during an appearance on Fox News’ “Jesse Watters Primetime,” Hawley cited the importance of transparency and accountability in allowing the public to understand the origins of the pandemic.

Hawley told Watters that the bill needs to pass in the House of Representatives, “and then we can get this thing done.” They previously introduced a similar bill which passed unanimously in 2021.

The bill would require Director of National Intelligence Avril Haines to declassify the information in the U.S. government’s possession on the most likely origins of COVID-19.

“Listen, the American people—it’s past time—let’s show them what the government has. Let everybody see for themselves. Let everybody read it,” he told Fox News after the vote.

Braun also declared the unanimous passage of the motion, likewise calling on the House to pass the bill.

“The House needs to pass this bill to let the American people see the facts! President Biden can’t ignore this: time to let Americans decide for ourselves,” he wrote on Twitter. 

This aerial view shows the P4 laboratory (L) on the campus of the Wuhan Institute of Virology in Wuhan in China’s central Hubei province on May 13, 2020. (Hector RETAMAL /AFP via Getty Images)

‘Skeptics Stand Vindicated’

On Monday, Hawley expressed concerns about the lack of transparency surrounding the pandemic’s origins, saying that for “nearly three years,” those questioning the Wuhan lab leak theory were “silenced and branded as a conspiracy theorist.”

However, the DOE’s report supports oft-maligned hypotheses that the virus emerged from the Wuhan Institute of Virology, which is located nearby to a wet market broadly cited as the pandemic’s ground zero.

“Now, these prudent skeptics stand vindicated,” Hawley said in a statement.

“The Biden administration must immediately declassify all intelligence reports pertaining to the origins of COVID-19 and the Wuhan Institute of Virology. The American people deserve to know the truth.”

Braun also criticized the Biden administration for its posturing on the lab leak theory.

“The Biden administration has called the lab leak theory a conspiracy theory from the beginning, and has only started to publicly admit they were wrong as the evidence becomes overwhelming,” Braun said in a statement.

Braun said that the Biden administration had kept information about the origins of COVID-19 a secret despite an earlier version of this bill passing the Senate unanimously in 2021.

“The American people deserve transparency, free from government censors or media spin. It’s time to declassify everything we know about COVID’s origins and the Wuhan Institute of Virology, now,” he said.

The Chinese regime has long dismissed the possibility of a lab leak, saying the virus’s origins “should not be politicized.” Its efforts to suppress the theory recently included warning Elon Musk, the billionaire owner of Twitter, Tesla, and SpaceX, not to share the lab leak report.

Read more here…

Tyler Durden
Thu, 03/02/2023 – 09:50

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Tesla Slumps 7% After Investor Day Falls Short On Details

Tesla Slumps 7% After Investor Day Falls Short On Details

Shares of Tesla are down more than 7% in pre-market trading after the company’s Investor Day, held yesterday afternoon, failed to impress the street. News outlets on Thursday morning are calling the presentation “underwhelming” and light on short-term specifics. 

Of note was the lack of specifics relating to how the company would be expanding its product lineup, which has begun to stagnate over the last several years. And, unlike past presentations and prognostications by Elon Musk publicly, this one had a “lengthy disclaimer” appended to the beginning of it, ARS Technica noted.

Over the course of 3 hours, Elon Musk laid out the third stint of the company’s “Master Plan”, wherein he offered little specific guidance about the company’s future, but for a couple of examples.

The company “reiterated Tesla’s goal to grow in production, from 1.3 million EVs in 2022 to 20 million EVs in 2030,” ARS Technica noted, and discussed some of the manufacturing streamlining that would be necessary to implement the future growth, including vertical integration. 

The company also said it would be refining its own lithium in Texas, a site they expect to be “producing the mineral for use in batteries within 12 months”, SVP of powertrain and energy engineering Drew Baglino said. 

The company also announced a new drive use using a rare earth-less permanent magnet motor, though a timeline on full scale production and implementation was unclear. Tesla VP for Powertrain Engineering Colin Campbell’s presentation about the rare earth-less drive train said that it would use “zero grams of rare earths”. 

Tesla also teased the idea of a “wireless” home charger for vehicles, Teslarati noted. 

During Tesla Head of Global Charging Infrastructure Rebecca Tinucci’s presentation, a slide appeared that appeared to show a wireless home Supercharger for vehicles. “A wireless charging system for Teslas would be nothing short of a game-changer,” Teslarati noted, but the presentation offered little in the way of details about the potential for such technology to roll out. 

Conspicuously absent from the presentation were updates to the Model Y or the now-eight-years old Model 3.

However not everybody was pessimistic about the presentation, with Goldman writing in a note on Friday morning: “The bottom line is that we believe the event should increase investor confidence in Tesla’s ability to reduce costs by ~50% with its next generation platform, given the breadth and depth of Tesla’s team and how its vertically integrated model allows it to optimize on both cost and performance criteria.”

Analyst Mark Delaney continued: “Tesla provided significant insights into how various teams are working to reduce cost, scale, and improve capabilities. We believe the company was able to show good progress in areas such as casting, 4680 cells (such as with the dry coating of the electrodes), semiconductors/power electronics and software. However, we believe many investors were hoping for more specifics on when a third generation vehicle could be shipping, and therefore the lack of clarity beyond the comment that they’re working as fast as they can and it could be in the next couple of years is likely to be viewed as a disappointment to some.”

Morgan Stanley’s Adam Jonas wrote in a note Friday morning that “Tesla’s audacious efforts on vertical integration are about to pay off. EVs are far too expensive today. Tesla gave a number of drivers for a 50% cost reduction for its next-gen platform. In a race to the bottom, we seriously question how the competition can keep up.”

You can watch the full presentation here:

Tyler Durden
Thu, 03/02/2023 – 09:35

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Be Skeptical of the New Artificial Sweetener Scare


ice cream

Does the artificial sweetener erythritol cause heart attacks and strokes? That’s the tenor of a spate of reporting on a new study published this week in the journal Nature Medicine. But there are numerous reasons to be cautious about drawing conclusions from the study’s purported findings.

The researchers report that “in patients undergoing cardiac risk assessment…circulating levels of multiple polyol sweeteners, especially erythritol, were associated with incident (3 year) risk for major adverse cardiovascular events,” including heart attack, stroke, and death. Erythritol—”one of the most widely used artificial sweeteners with rapidly increasing prevalence in processed and ‘keto’-related foods”—was “among the very top” molecules associated with these tragic outcomes.

“Subsequent analyses of stable patients undergoing elective cardiac evaluation confirmed this association,” with patients with the highest levels of circulating erythritol in their blood more likely to have cardiovascular disease and more likely to experience major adverse cardiovascular events. “Compared to participants in the lowest quartile of erythritol levels, those in the highest quartile had a substantially increased incident event risk in both” U.S. and European cohorts, the study states.

“The degree of risk was not modest,” lead study author Stanley Hazen, director of the Center for Cardiovascular Diagnostics and Prevention at the Cleveland Clinic Lerner Research Institute, told CNN—one of many major media outlets to report (uncritically) on the study’s findings. CNN summed it up like this: “People with existing risk factors for heart disease, such as diabetes, were twice as likely to experience a heart attack or stroke if they had the highest levels of erythritol in their blood.”

That sounds bad, right? But let’s dig a little deeper.

The first issue to jump out here is that all of the people studied already had metabolic issues of some sort. So it’s at least unclear that these results would generalize to populations without these issues.

Another red flag (raised by a neurobiology Ph.D. student on Twitter) is that the people in the highest quartile of erythritol levels look quite different than the people in the lowest quartile. In the first part of the study, for instance, those in the lowest quartile had an average age of 59.8, while those in the highest quartile had an average age of 70.2. The highest quartile had about a point heavier BMI, was less likely to be male, and was significantly more likely to have diabetes (36.7 percent versus 14.8 percent in the lowest quartile). They were more likely to have a history of heart attack and heart failure, and had significantly higher blood triglyceride levels, among other things. And similar differences can be seen in the U.S. and European study cohorts.

The researchers say they adjusted for these factors. But it’s difficult to adjust for such a wide range of differences and all the complex metabolic processes that they entail.

Perhaps the biggest issue in the study—noted by University of Oxford researcher Nicola Guess—is that human bodies produce some erythritol naturally, and yet the researchers didn’t control for endogenous versus exogenous erythritol.

Like cholesterol, the amount of erythritol in the body doesn’t directly correspond to erythritol consumed. Exogenous erythritol—which comes from our diet—is what all the reports on this study are concerned with. (For instance: “Study Suggests Possible Link Between Sugar Substitute and Heart Issues,” reported The New York Times in a typical headline about the study.) Endogenous erythritol is a molecule produced internally.

But the researchers in this study did not tease out how much circulating blood erythritol came from each source, leaving open the possibility that a) it’s not only or even mostly consumption of erythritol as a sugar substitute that led to high erythritol levels in the cohort with the worst outcomes and b) it’s not only or even mostly consumption of erythritol as a sugar substitute that is linked to higher instances of heart attack, stroke, and death.

It still could be—but we certainly can’t tell that from this study. And there’s good reason to suspect that naturally produced erythritol here is the more likely suspect.

“Erythritol is produced in the body via the pentose phosphate pathway (PPP), a process which might be upregulated by oxidative stress,” explained Guess. That is, oxidative stress—itself a major cause of health issues including cardiovascular problems—can lead to increased production of endogenous erythritol.

“In fact, [as far as I know], serum erythritol is somewhat recognised as an early, general marker of cardiometabolic dysfunction,” Guess continued.

This recognition that blood erythritol levels can cause problems predates the new study. “Serum erythritol is a predictive biomarker of chronic disease development and complications,” according to a 2021 paper published in the journal Current Developments in Nutrition.

A 2020 study published in Clinical Nutrition and Metabolic Care states that “elevated serum erythritol predicts future central adiposity gain and type 2 diabetes mellitus in healthy adults.” It points out that “erythritol is a newly recognized human metabolic product of glucose, synthesized through the pentose phosphate pathway.”

This pathway is stimulated by a range of things that can also lead to major adverse cardiac events, making the idea that dietary erythritol is the main cause of elevated serum erythritol and adverse outcomes suspect.

This isn’t to say that dietary erythritol definitely doesn’t or couldn’t contribute to problems. And the researchers in the Nature Medicine study perform a few more experiments that they say demonstrate this (though Guess also points out potential flaws in these). But much more (and better) research is needed before we sound any major alarms about erythritol consumption.


FREE MINDS

Is teen mental health tied to politics? Matthew Yglesias explored research suggesting that liberal teens are more depressed than their conservative counterparts:

But I want to talk about…a 2021 paper by Catherine Gimbrone, Lisa Bates, Seth Prins, and Katherine Keyes titled “The politics of depression: Diverging trends in internalizing symptoms among US adolescents by political beliefs.” The CDC survey doesn’t ask teens about their political beliefs, but Gimbrone et. al. find not only divergence by gender, but divergence by political ideology. Breaking things down by gender and ideology, they find that liberal girls have the highest increase in depressive affect and conservative boys have the least. But liberal boys are more depressed than conservative girls, suggesting an important independent role for political ideology.

I think the discussion around gender and the role of social media is an important one. But I also don’t believe that liberal boys are experiencing more depression than conservative girls because they are disproportionately hung up on Instagram-induced body image issues — I think there’s also something specific to politics going on.

Some of it might be selection effect, with progressive politics becoming a more congenial home for people who are miserable. But I think some of it is poor behavior by adult progressives, many of whom now valorize depressive affect as a sign of political commitment. The thing about depression, though, is that it’s bad. Separate from the Smith/Levitz project of arguing about recent political trends, I think we need some kind of society-level cognitive behavioral therapy to convince people that whatever it is they are worried about, depression is not the answer. Because it never is.

More here. (See also: Don’t be a doomer.)


FREE MARKETS

The outsize role of immigrants in U.S. innovation. A new paper from the National Bureau of Economic Research (NBER) finds “immigrant inventors are key contributors to innovation in the United States, both through their direct productivity and through the spillover effects of their work with native-born collaborators,” as an NBER summary puts it:

While accounting for just 16 percent of all US-based inventors, immigrant inventors produce nearly a quarter of total innovation output as gauged by the number of patents and patent citations and the economic value of the patents.

Looking at data on immigrant inventors between 1990 and 2016 (with immigrants defined as people who got a Social Security number at age 20 or later), they found that “immigrants produced 23 percent of all patents over the study period.” In addition, immigrants “collaborated with native-born inventors on 13 percent of all patent filings, so they were either directly or indirectly responsible for 36 percent of US patent output during the study period.”

You can find the full paper (“The Contribution of High-Skilled Immi­grants to Innovation in the United States”) here.


QUICK HITS

• The American Civil Liberties Union is launching a new initiative dedicated “to help[ing] those facing prosecution for providing, supporting, or seeking abortion care.”

• A new report looks at “how the war on sex work is stripping your privacy rights.”

• “Last month, Boulder County spent the first of what it hopes will be millions of dollars for the treatment and prevention of drug addiction, courtesy of lawsuits against the drug manufacturers, distributors and pharmacies that helped fuel America’s opioid epidemic,” notes Boulder Beat. “Among the spending was money for controversial yet widely used technology to gain access to locked cell phones and computers.”

• The encrypted messaging app Signal says it will stop providing U.K. services if the country’s proposed Online Safety Bill passes.

The post Be Skeptical of the New Artificial Sweetener Scare appeared first on Reason.com.

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“Tape Is Nearing Max Frustration”: JPM Trading Desk Warns Break Below 3900 Could Spark Global Selloff

“Tape Is Nearing Max Frustration”: JPM Trading Desk Warns Break Below 3900 Could Spark Global Selloff

With futures sinking for a third day and set to take out the 200dma (S&P cash at 3938), traders are bracing for a potential air pocket lower in today’s session, one which could drag stocks sharply lower if 3900 is also taken out. And while we will have more to say about the technicals in a follow up post, here is a quick snapshot from the trading desk of the largest US bank, JPMorgan.

We start with the overnight market snapshot from JPM index trader Jason Hunter who writes that the move lower can accelerate rapidly if key support around 3,900 is taken out:

The S&P 500 Index slide from anticipated resistance in the 4100s threatens key chart levels surrounding 3900. A move through that support has the strong potential to accelerate bearish price pressures, in our view. Other markets that have been sensitive to the China rebound story are testing key chart levels as well. A break there has the potential to feedback into western markets as global macro sentiment may sour.

Even after the recent setback, the S&P 500 Index still looks overvalued relative to the shape of the money market curve. We have used versions of regression models based on that relationship to not only show the limited upside for the index (4100-4200 resistance), but also show asymmetric downside risk that is still present on the residual chart.

An 18-month relationship that uses the expected terminal rate and overall amount of easing priced after terminal rate is achieved currently shows the index fair value just below 3800. A retest of the 3491 4Q22 low would roughly equate to 2 standard deviations oversold, all else equal. That study has a 0.75 r-squared and 160pt standard error.

And here is some additional color from JPM TMT trader Ron Adler who notes that “This tape is nearing max frustration” to wit:

This tape is nearing max frustration. The desk and TMT are again very balanced from a flow perspective. We continue to see LO demand in the MegaCap, some idiosyncratic positioning in software ahead of tonight. A TON of paper hit the market (I believe ~$2.9B), and this doesn’t account for the heightened VC distributions seen as windows open post earnings. Yields are the issue today (though the dollar is not reacting in tow, though EUR/USD is stronger); still, all things considered, the market is hanging in ok (famous last words)

The red headline guy has almost hit the “send” button on the “10-year yields hit 4% for the first time since November 2022” headline 17 times today. Growth investors anxiously await that catalyst to sell the stocks they sold in November again (you know, the same ones they subsequently bought in January). That trigger finger is very, very itchy.

APP BASED DELIVERY | Received a few questions on the NYC Minimum wage issue. Remember that time when NYC said it would decide about a minimum wage for delivery workers by February 15, then on February 15 changed the language on the website to say it “now expects to issue a final rule by February 2023.” Today is March 1. I haven’t seen anything yet (language on the website still says end of February .

Finally, as a bonus, here are the key factors that Goldman’s equity desk is focusing on:

  • DESK ACTIVITY… B/S skew on the floor finished roughly flat. LOs finished 320bps better to buy driven by mega-cap tech and ETFs (ETF volumes tracked ~36% of the tape). HFs finished 415bps better to buy, with notable buy skews in HC and tech. Continue to see corporates and sponsors monetize in block form – desk saw blocks in OPCH & HAYW post close
  • CHINA…China will make a push at the G20 foreign ministers meeting on Thurs for peace talks to commence in the Ukraine war, but Washington is very skeptical Russia has any intention to negotiate in good faith and end its aggression – NYT.
  • PB ONE LINERS…Looking back on Feb: Overall Prime book saw the largest notional net selling in 8 months (-1.2 SDs one-year), driven by elevated short sales outpacing long buys ~4 to 1. Single Stocks were net bought for a 3rd straight month and saw the largest notional net buying in 5 months (+0.9 SDs one-year), driven by risk-on flows with long buys outpacing short sales ~6.5 to 1 (in contrast to January during which short covering dominated the flows).
  • GEOPOLITICAL TENSIONS…Tensions continue to simmer, reportedly the US is sounding out close allies about the possibility of imposing new sanctions on China if Beijing provides military support to Russia for its war in Ukraine. However, on the bright side the WSJ reports that a senior Treasury Department official recently traveled to Beijing and met with Chinese counterparts for technical, staff-level discussions on macroeconomic and financial issues. Meanwhile, China’s Vice Minister of Commerce said his country is willing to conduct candid talks with the US to reduce trade and investment restrictions, in order to implement consensus reached by leaders of the two countries in Bali. (TY Fred Yin).
  • CTAs…Updated numbers: In a flat tape ($27B for SALE – $20B in SPX).
  • 10 YEAR YLDS…3.4% to start Feb…4.08% currently…

Tyler Durden
Thu, 03/02/2023 – 09:22

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Cross-Border ‘Terror Attack’ On Russia Involved Dozens Of Armed Saboteurs Attacking Villages

Cross-Border ‘Terror Attack’ On Russia Involved Dozens Of Armed Saboteurs Attacking Villages

The Kremlin has condemned what it called a new terrorist attack on its soil Thursday carried out by Ukrainian saboteurs who allegedly breached a border region. 

Russian presidency spokesman Spokesman Dmitry Peskov said militants entered the Bryansk Oblast in Western Russia and attacked villages there, resulting in the death of one civilian and another wounded. “This is an attack by terrorists,” Peskov said.

Conflicting initial reports indicated Russia’s Federal Security Service engaged in a gun battle with  the infiltrators, with the Kremlin saying “Measures are currently underway to eliminate these terrorists.”

The Associated Press describes based on national media that “Tass, citing Russian law enforcement, reported earlier that the saboteurs were holding up to six people hostage.”

“The local governor said the group had fired on a vehicle there, killing one man and wounding a 10-year-old,” AP continues. The report details further:

Thursday’s apparent incursion was also embarrassing for Russian President Vladimir Putin, coming days after he ordered the Federal Security Service to tighten controls on Russia’s border with Ukraine.

Tass reported, citing an unnamed security official, that two villages in the Bryansk region — Sushany and Lyubechane — were under attack by “several dozen armed fighters.”

Alexander Bogomaz, the governor of the Bryansk region, which borders Ukraine, said the group fired on a vehicle in Lyubechane, killing one man and wounding a child. He also said that a Ukrainian drone struck a house in the Sushany, setting it ablaze.

Multiple war monitoring accounts have picked up on the below video which is widely being flagged as showing one of the alleged attackers:

Peskov said in response to a question over what action Moscow could take in the international arena, “On the international arena, [we] have drawn and continue drawing the attention of the world public to those terror attacks that these people [Ukrainian terrorists] carry out.”

Putin also directly addressed the cross-border terror attack in a video address after convening his national security council to be briefed on the matter…

“They opened fire on civilians,… they saw that there were children in the car,” Putin said.

The incident comes after Monday into Tuesday a series of drone attacks on Russian facilities, believed launched by the Ukrainians, triggered air alert sirens in various locations across the country. One or more even reached to within 100km of Moscow. 

Concerning the drone attacks, Russia’s Deputy Minister of Foreign Affairs has charged that the Ukrainians had covert help from the United States in carrying out the sophisticated drone operations, one of which damaged an oil facility some 500km inside Russian territory. “Attack of drones on aviation facilities in Saratov and Ryazan could not have been carried out without the active assistance of the United States,” Ryabkov said in a press statement.

Tyler Durden
Thu, 03/02/2023 – 09:05

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The Forces Upending The Global Economy Cannot Be Reversed

The Forces Upending The Global Economy Cannot Be Reversed

Authored by Charles Hugh Smith via OfTwoMinds blog,

So sorry, but the lifestyle of low-cost credit and all the goodies it could buy is permanently out of stock.

In focusing on geopolitics, we lose sight of the dependence of every economy on a functioning global economy of low-cost goods, services, materials, shipping, transport, capital, labor and financial instruments, all flowing freely across borders and around the world.

Russia, China, the U.S., and indeed every economy are equally dependent on access to a functioning global economy to obtain essential goods, services and capital and sell surplus production.

The irony here is the “poor” subsistence villagers with very limited access to global markets will manage the breakdown of the global economy far better than the “wealthy” urban dwellers who are totally dependent on free-flowing global trade. (The villagers will be frustrated by spotty cell service; the urban dwellers will be hard-pressed to obtain enough food and fuel to survive.)

What few seem to realize (or acknowledge) is the forces already in motion will upend the global economy, and there is no reverse gear. These forces are:

1. De-globalization

2. De-financialization

3. Real-world scarcities that cannot be overcome with financial trickery.

4. Diminishing returns on what worked in the past: financial stimulus and other trickery.

5. Asymmetries that can no longer be papered over.

Each of these forces is multi-faceted and complex. Each has the unstoppable momentum of cause and effect. The financial trickery of the past 30 years has created a delusional faith that there are no real-world scarcities or difficulties that can’t be resolved with some new financial stimulus or gimmick. This is a compelling delusion, for we all want magic that makes the real world do what suits us.

The central delusion is that “money” (credit/currency) from somewhere can magically extract as many materials and goodies as we want from somewhere else. This is hyper-globalization and hyper-financialization in a nutshell: hyper-financialization is the global commoditization of credit, leverage and trickery, enabling the vast expansion of credit, leverage and trickery which has fueled the astounding expansion of speculative frenzy which is now the engine of the global economy.

Hyper-globalization is the fulfillment of the neoliberal fantasy that commoditizing self-regulating (ha-ha, you mean cartels and monopolies, correct?) markets would permanently lower costs and expand credit, consumption and prosperity. In this hyper-version of global trade (which has existed for thousands of years), the mass commoditization of credit and capital flowing freely around the world, plucking (and exploiting) the most profitable opportunities wherever they might be (luxury resort in Timbukthree, count us in, at least until we can find a sucker to buy our commoditized debt instruments) will all by itself lower costs and boost production and consumption forever.

Nice, but financial trickery eventually runs into real-world constraints and asymmetries it cannot resolve. Once the cheap-to-get resources have been depleted, it costs more to extract, process and transport them, even with technological advances.

Other constraints are economic, political and social in nature. Local populaces eventually realize their resources are being plundered by corporations from afar who arbitrage vast asymmetries in the cost of capital, labor costs, environmental standards and currency valuations (to name a few) to stripmine locals and leave them the “dividends” of hyper-globalization and hyper-financialization such as polluted wastelands and unpayable debts.

Nations eventually awaken to the risks of becoming dependent on others for essentials, and so onshoring, friend-shoring and reshoring all become national-defense policies, never mind the corrupting neoliberal fantasies of everyone singing Kumbaya around the hyper-globalization and hyper-financialization campfire.

Creating a billion units of currency doesn’t automatically conjure up a billion units of fresh water, wheat or oil. When there were unexploited reserves of these essentials, then massive infusions of capital from somewhere else could fund their extraction, but when the easy-to-get reserves have been depleted, then cheap capital doesn’t translate into cheap goodies.

The reversal of these forces has a funny consequence which we call inflation. Let’s start by setting aside economic fantasies such as “inflation is always a monetary phenomenon.” If a primary source of oil happens to be blown to bits and oil jumps $50 a barrel overnight, costs will rise in a manner that has nothing to do with the expansion or contraction of the money supply. “Inflation” is simply this: a unit of labor / currency buys fewer goods and services, or buys goods and services of lower quality.

However you wish to put it, labor and money lose purchasing power: each unit of labor/currency buys less than it did in the past.

Inflation has many sources, but let’s focus on the reversal of hyper-globalization and hyper-financialization. The reversal of financialization increases the cost of capital (interest rates, cost of mitigating rising risk) and the reversal of globalization increases the costs of goods and services.

The global realities of depletion and scarcity also push costs higher.

Simply put, each of these forces is highly inflationary as a matter of cause and effect. There is no way to conjure a hat-trick of financial gimmicks to reverse these forces of higher costs, i.e. inflation: every unit of labor and currency buys less than it did in the past.

Authorities have been trained by the golden decades of abundance and low costs to do more of what worked in the past, i.e. financial stimulus of one kind or another. Just flood the land with credit and currency, and the magic will fix whatever is broken or hobbling.

But the returns on these artifices have diminished to the point that the gimmicks are not just failing, they are actively making the problems worse. Thanks to the globalization of “The Fed Put,” moral hazard is now the context of every global financial decision. Financial stimulus inflates speculative bubbles, which inevitably pop, generating waves of distress which additional waves of financial stimulus only accelerate.

The notion that speculative bubbles can painlessly fuel abundance and prosperity is bankrupt, and the collapse of this appealing delusion will collapse the entire global structure of hyper-financialization.

In a delicious irony, stimulus in any form is now inflationary. Doing more of what worked in the past will now accelerate the “problem” central banks and governments are trying to solve: inflation. This reality drives a stake through the heart of all the hopes that doing more of what worked in the past will magically work, even as it adds fuel to the bonfire of higher costs.

Lastly, there is a broad spectrum of destabilizing asymmetries which can no longer be papered over with gimmicks. These include (but are not limited to) profound asymmetries in risk premiums, liquidity and valuations, resource reserves, political stability, dependencies on global markets for buyers of last resort and so on.

The bottom line is there are few if any nations that could survive intact should hyper-globalization and hyper-financialization collapse and scarcities increase. As I explained in Weaponizing Global Depression, real-world resources and financial, poltical and social systems that are transparent and adaptable are the necessary foundations for the shift from dependence to self-reliance.

So sorry, but the lifestyle of low-cost credit and all the goodies it could buy is permanently out of stock. The banquet of consequences is being served even if no one has the appetite for what is about to be forced down their throats by constraint, asymmetries and cause-and-effect.

New Podcast: Turmoil Ahead As We Enter The New Era Of ‘Scarcity’ (53 min)

*  *  *

My new book is now available at a 10% discount ($8.95 ebook, $18 print): Self-Reliance in the 21st Century.

Read the first chapter for free (PDF)

Become a $1/month patron of my work via patreon.com.

Tyler Durden
Thu, 03/02/2023 – 08:45

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Jobless Claims Improve (Again) As Labor Costs Soar More Than Expected

Jobless Claims Improve (Again) As Labor Costs Soar More Than Expected

Despite the ongoing headlines of layoffs across all industries, US jobless claims data continues to refuse to show anything but an extremely strong labor market, with initial claims at 190k last week (better than the 195k expected) and continuing claims at 1.655mm (below the 1.669mm expected)

Source: Bloomberg

Kentucky and California saw the biggest drop in claims while Massachusetts and Rhode Island saw the largest rise…

The total number of Americans on some form of unemployment benefits continues to hover around one-year highs…

Source: Bloomberg

More problematically for Powell and his pals, unit labor costs for Q4 (final) printed +3.2% QoQ (double the expected 1.6% rise), up for the 7th quarter in a row.

Source: Bloomberg

We’re gonna need a bigger rate-hike!

Tyler Durden
Thu, 03/02/2023 – 08:36

via ZeroHedge News https://ift.tt/6WvraUf Tyler Durden

Apple Demands ChatGPT-Based Email App Moderate Content Or Raise Age Restriction

Apple Demands ChatGPT-Based Email App Moderate Content Or Raise Age Restriction

AI-related stocks have dipped in the pre-market after a report by The Wall Street Journal, with a scary-sounding headline, prompted more concerns about the future of AI use.

MSFT (which invested in OpenAI) and NVDA (which makes the chips that AI needs) are among the day’s early losers on this headline but the story is not quite as terrifying for the future of ChatGPT as one might imagine.

The App in question is called BlueMail which has a new AI feature uses OpenAI’s latest ChatGPT chatbot to help automate the writing of emails using the contents of prior emails and calendar events.

WSJ reports that Apple has delayed the approval of an email-app update with AI-powered language tools over concerns that it could generate inappropriate content for children, according to communications Apple sent to the app maker.

“Your app includes AI-generated content but does not appear to include content filtering at this time,” Apple’s app-review team said last week in a message to the developer reviewed by the Journal.

The app’s restriction is currently set for users 4 years old and older. Apple’s age restriction for 17 and older is for categories of apps that may include everything from offensive language to sexual content and references to drugs.

Ben Volach, co-founder of BlueMail developer Blix Inc., said many other apps that advertise a ChatGPT-like feature listed on Apple’s App Store don’t have age restrictions.

“We want fairness,” said Mr. Volach.

“If we’re required to be 17-plus, then others should also have to.”

The rejection is notable though as Apple’s attempt to set an age restriction to help moderate content from a language-model-based AI is an indication the tech giant is closely watching the new technology and the risks it poses.

Tyler Durden
Thu, 03/02/2023 – 08:23

via ZeroHedge News https://ift.tt/7uT0eqY Tyler Durden