Stocks Sink As ‘Appulus’ Fails To Impress; Gold Up, Crypto Down, Oil Flat

Stocks Sink As ‘Appulus’ Fails To Impress; Gold Up, Crypto Down, Oil Flat

Eurozone PPI plunged overnight, but ugly US Services PMI data and slumping factory orders sent yields dramatically lower. For context, this was the worst day for the US macro surprise index since the first week of January…

Source: Bloomberg

The overnight extension of Friday’s yield surge (pushing yields up by 6-8bps before the data hit) was cut short by the weakness in US macro data, plunging yields 10-14bps lower, leaving yield lower on the day by 1-2bps…

Source: Bloomberg

But the big story going into today was Apple’s WWDC event. Apple Surged up to an all-time high in the morning session but as they released the VR/AR headset, the price plunged into the red for the day. ‘Appulus’ starts at $3499 and won’t be released until 2024..

And that weighed on the broader market. Small Caps had been lagging all day, not helped by chatter of much higher capital requirements for ‘mid’-sized banks. Nasdaq was leading the day until AAPL shit the bed. The S&P and Dow ended red…

S&P pushed into a ‘bull market’, up 20% off the October lows intraday, finding resistance at a key level though…

Source: Bloomberg

It is worth noting that the Nasdaq/Russell2000 ratio rebounded today but was unable to recover its record highs from March 2000…

Source: Bloomberg

Bank stocks tumbled on the Basel III Endgame headlines…

Additionally, early in the day, the SEC sued Binance – the world’s largest crypto exchange – and that sent all cryptocurrencies lower with Bitcoin back down to $25,500…

Source: Bloomberg

The dollar ended basically flat on the day, erasing overnight gains as the weak US data hit…

Source: Bloomberg

2Y yields broke back below 4.50%…

Source: Bloomberg

Oil prices surged higher on Sunday night after Saudi’s production cuts, with WTI topping $75. But as the day wore on WTI slipped lower to end basically unchanged…

Get back to work MbS!

Gold rallied on the bad econ news, ripping all the way up to pre-payrolls levels…

Finally, tick tock on the latest bubble-fest?

Source: Bloomberg

Did ‘Appulus’ just distract the world from AI long enough for some rational thought to return?

Tyler Durden
Mon, 06/05/2023 – 16:00

via ZeroHedge News https://ift.tt/4lmCfzo Tyler Durden

Junk Firms Face Steepest Debt Costs In Decade As Economic Reckoning Arrives

Junk Firms Face Steepest Debt Costs In Decade As Economic Reckoning Arrives

For corporations with junk credit ratings, the cost of debt servicing has skyrocketed, reaching levels not seen in over a decade. This surge can be attributed to the Federal Reserve’s rate-raising campaign. And it might force some companies to reevaluate capital structures. 

Bloomberg cited an S&P Global Ratings report that outlined junk-rated firms are paying an effective rate of 6.1% on debt, up from 5.1% last year. The 6.1% rate is the highest interest on debt since 2010.

Surging interest rate costs will likely force companies with heavy debt loads to rethink their capital structures:

“If funding costs remain higher for the long term, this may force a rethink of capital structures and bring more focus on protecting cashflows.”

 “We could see greater efforts to reduce net debt, more use of equity in M&A, and more caution over capital expenditure,” said Gareth Williams, head of corporate credit research at S&P.

Junk-rated firms will have to reconsider their business plans developed during a low-rate environment while the era of cheap money has been over for 14 months and will likely be over for some time as the Fed wrestles with inflation. Bloomberg pointed out a perfect storm forming:

“High-yield firms in particular are having to deal with the dual impact of costly payments from floating-rate debt and lower earnings.”

Some of the highest rises in interest paid versus total debt are in developers and housebuilders, healthcare, aerospace, and technology firms. 

The decade of a debt-fueled expansion has come to an abrupt end. And this means pain for zombie companies:

“The transition may be the hardest part. More vulnerable credits with capital structures built for a world of near-zero rates are more likely to default,” Williams said.

These junk-rated firms will need to eliminate debt and scale back growth as the cost of servicing debt and interest rates on the line of credit are sky-high. 

S&P warned late last year a corporate default wave would erupt in even a mild recession. 

Tyler Durden
Mon, 06/05/2023 – 15:40

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If You Stand In The Way Of Their Agenda, You Will Pay A Price

If You Stand In The Way Of Their Agenda, You Will Pay A Price

Authored by Michael Snyder via The End of The American Dream blog,

The cultural environment that we live in has become insanely oppressive, and I am about to share an example with you that perfectly demonstrates this.

A few days ago, a high school student in a rural area of Idaho told his fellow students that “guys are guys and girls are girls”, and the fallout from that statement proceeded to create a firestorm of controversy that is making headlines all over the nation.  Sadly, the truth is that we now live in a society where anyone that tries to resist the new culture that is being imposed on all of us must be severely punished. 

Dissent is simply not allowed, and Kellogg High School senior Travis Lohr found that out the hard way

On Thursday, Kellogg High School senior Travis Lohr took part in an activity where seniors share advice for lowerclassmen. In a departure from his preapproved remarks, Lohr spoke from his heart, saying, “Guys are guys and girls are girls. There is no in-between.”

Despite the fact that this simple statement has been a truism for all of human history, the leadership of Kellogg High School seemed to think it was unacceptable. Principal Dan Davidian informed Lohr that he would not be allowed to walk in his graduation ceremony on Saturday.

This didn’t take place in California.

Kellogg High School is located in one of the most conservative areas of one of the most conservative states in the entire nation.

If this can happen in Idaho, it can happen anywhere.

When the community learned what had happened, a peaceful protest was quickly organized, and that is when things started getting really crazy.

The following is how a member of the Idaho legislature named Heather Scott summarized what we have witnessed so far

UNACCEPTABLE! The Shoshone County Kellogg High school graduation is canceled for all students! So how I am understanding this is:

1. A student speaks scientific truth at a school assembly (“Guys are guys and girls are girls. There is no in-between.”)
2. Science denier “adult” teachers were offended.
3. The student was punished and is now forbidden to participate in graduation.
4. Parents, students, and community members voiced their concerns in a peaceful protest.
5. The school then fired an off-duty bus driver for joining the peaceful protest!
6. The Shoshone County Sheriff’s Office informed the school of concerns about “safety”
7. The school will now punish the entire student body and community by postponing graduation for all students.

Why in the world would a bus driver be fired on the spot for simply joining a peaceful protest?

Unfortunately, all of those that showed public support for Travis Lohr are being framed as the bad guys.

And it turns out that the sheriff that raised “safety concerns” about the graduation ceremony also happens to be married to an art teacher at the high school

Shoshone County Sheriff Holly Lindsey cited “Safety Concerns.”

Sheriff Lindsey is “married” to Kellogg HS Art Teacher Rachel Krusemark, one of the 3 teachers offended by Travis Lohr’s statements.

If those teachers had not made such a fuss, this controversy never would have erupted.

Why can’t they just let people say things that they disagree with?

People say things that deeply offend me all the time, but I am not trying to shut down their right to say those things.

Sadly, it isn’t just the school that has taken action.  According to Travis Lohr, he has also just had a job offer rescinded

A student barred from his high school graduation ceremony after stating there are only two genders said in a Sunday interview on “Fox & Friends” that a firefighting job offer has now been rescinded.

He was supposed to work on Sunday, but when he showed up to complete his paperwork he was given the bad news

Lohr told Campos-Duffy he was slated to start work Sunday, but when he went in to complete the final paperwork, his boss informed him he was rescinding the offer. He described the job as “fighting wildland forest fires.”

“That’s part of life, as I am learning, and I am going to continue to grow from here. I’m not going to dwell on it.”

Yes, this has actually happened in the deep-red state of Idaho.

This just shows how far our society has fallen.

In other areas of the country, radical activists have been making bomb threats against Target just because the retailer removed “some of its Pride Month merchandise after significant backlash”

LGBTQ radicals reportedly deluged Target with bomb threats in retaliation to the retail giant pulling back on some of its Pride Month merchandise after significant backlash.

The bomb threats were allegedly made against several Target stores in at least three states: Utah, Pennsylvania, and Ohio.

Our nation is being ripped in two, and there are no quick fixes on the horizon.

Of course a similar revolution is currently underway in Europe.  This week, we learned that a “topless pregnant transgender man” is on the cover of Glamour U.K.’s June issue…

A topless pregnant transgender man featured on the cover of Glamour U.K.’s June issue ignited a fierce reaction from online critics Thursday.

Author Logan Brown, a 27-year-old who was born female but now identifies as a transgender man, posed as the cover star of British Glamour Magazine’s digital issue celebrating Pride Month in a painted-on suit, showcasing a large baby bump. Brown unexpectedly became pregnant with partner Bailey J Mills, a non-binary drag performer in the U.K., while taking a break from testosterone treatments due to health reasons, the fashion magazine said.

Everywhere around us, we are being bombarded by propaganda that has been carefully designed to promote the new culture that is relentlessly being imposed upon us.

If you dare to stand in the way of this agenda, you will be punished.

If things are this bad now, just imagine what our culture would look like if we were given another 40 or 50 years…

*  *  *

Michael’s new book entitled “End Times” is now available in paperback and for the Kindle on Amazon.com, and you can check out his new Substack newsletter right here.

Tyler Durden
Mon, 06/05/2023 – 15:20

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“Bad For America” – Mid- & Big-Banks May Face 20% Jump In Capital Requirements

“Bad For America” – Mid- & Big-Banks May Face 20% Jump In Capital Requirements

U.S. regulators are preparing to force large banks to shore up their financial footing, moves they say will help boost the resilience of the system after a spate of midsize bank failures this year.

The Wall Street Journal reports, citing people familiar with the plans, the changes, which regulators are on track to propose as early as this month, could raise overall capital requirements by roughly 20% at larger banks on average.

Banks with at least $100 billion in assets may have to adhere to new requirements, lower than the existing $250 billion threshold, for which regulators have reserved their most stringent rules, according to the Journal.

Banks that are heavily dependent on fee income – such as that from investment banking or wealth management – could also face large capital increases.

Fed Vice Chair for Supervision Michael Barr signaled to House lawmakers in May that he believes capital requirements should be higher.

The banking system might need additional capital to be more resilient precisely because we don’t know the nature of the kinds of ways we might experience shocks to the system, as has happened with these recent bank failures.”

Barr has previously said that US officials are reviewing bank capital requirements and committed to putting in place strictures that align with Basel III.

Bloomberg reports that the biggest banks have argued that their steadiness in the recent turmoil showed their strength and that they already have more than enough capital. The six biggest US firms have added more than $200 billion to their capital reserves in the last decade, and JPMorgan said last month that its total loss-absorbing capacity now exceeds the loan losses that all US banks had during the financial crisis.

“Higher capital requirements are unwarranted,” said Kevin Fromer, the chief executive of the Financial Services Forum, which represents the largest U.S. banks.

“Additional requirements would mainly serve to burden businesses and borrowers, hampering the economy at the wrong time.”

JPMorgan CEO Jamie Dimon has been among critics blasting more cumbersome capital requirements, calling the upcoming increase “bad for America” last year ahead of a pair of congressional hearings.

The coming proposal is the last piece of capital rules that global policy makers agreed to implement after the 2007-09 financial crisis. The overhaul forced banks around the world to boost their capital cushions in hopes of making them better prepared to weather downturns without taxpayer bailouts.

Nathan Dean, Bloomberg’s senior government analyst noted that:

“The last remaining piece of Basel III, known informally as the Basel III endgame, would alter capital levels for US banks as regulators recalibrate risk-weighting of assets and restrict internal models used to calculate both credit and operational risk.”

All three agencies (The Fed, OCC, and FDIC) are expected to seek comment on the proposed capital rules.

They would have to vote again to complete the changes, likely implementing them over the coming years.

However, JPMorgan said at its investor day that while the final pieces of Basel III capital rules – which some investors have referred to as Basel IV because they could be so extensive – may be proposed soon, they’re unlikely to be implemented before early 2025.

Tyler Durden
Mon, 06/05/2023 – 15:00

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Ron Paul Ravages Republicans’ Fiscally Irresponsible Act

Ron Paul Ravages Republicans’ Fiscally Irresponsible Act

Authored by Ron Paul via The Ron Paul Institute for Peace & Prosperity,

The political and financial class breathed a sigh of relief when Congress passed the Fiscal Responsibility Act of 2023. The bill suspends the debt ceiling for two years, thus avoiding the establishment’s nightmare of a government default on its debt. Rather, it allows the government to continue adding trillions of dollars of debt that will be monetized by the Federal Reserve.

Of course, this default will be felt by the people in the form of an inflation tax. This inflation tax may be the worst of all taxes, because it is both hidden and regressive. Politicians love to point the finger at greedy corporations, labor unions, and even consumers for increasing prices instead of taking responsibility for the legislation they pass that incentivizes the Federal Reserve to create more inflation.

Republican supporters of the bill claim it begins to roll back the excessive spending of the Biden years. While the bill does rescind $28 billion of unspent COVID funds, it  just recycles that money into the Fiscal Year 2024 budget. Thus it does not save taxpayers a dime. The bill does cap domestic discretionary spending for Fiscal Year 2024 at $704  billion and spending for Fiscal Year 2025 at $711 billion. However, these caps come from a budget whose baseline includes the increased COVID spending. The bill only cuts spending by 0.1 to 0.2 percent of gross domestic product over the next two years  – assuming Congress does not reverse the cuts. Of course, it makes no attempt to actually cut spending, much less eradicate any illegitimate and unconstitutional government agencies, cabinet departments, or programs.

Even though “defense” is the third largest item in the budget (behind social security, Medicare, and interest in the national debt), our annual military budget alone is more than the combined  budgets of the next ten biggest spending countries. The Fiscal Responsibility Act doesn’t take a penny away from the military budget; instead it matches President Biden’s request for a 3.2 percent increase.  This increase comes despite the fact that the Pentagon has never complied with the law requiring it to pass an audit. 

Biden’s military budget is the largest in United States history and probably world history. Deep  State Republicans like South Carolina Senator Lindsay Graham never met a war he didn’t love.  Graham and his allies threatened to block passage of the bill unless the military spending was increased and more taxpayer money—and Ukraine and Russian lives — wasted in the Ukraine Russian conflict.

Hawks alienate current and potential allies with their hyper-interventionist policies. This along with the increasing national debt is leading to increased challenges to the US dollar’s status as the world’s reserve currency. The dollar’s status is the only reason Congress has been able to run up such a huge deficit without causing a major economic crisis.

The Fiscal Responsibility Act will result in increased government spending, debt, and deficits. It will also further erode the value of the United States Dollar, thus making it more likely that the US dollar will lose its world reserve currency status sooner rather than later. The Fiscal Responsibility Act is to fiscal responsibility as the Affordable Care Act is to affordable health care and as the Patriot Act is to true Patriotism. Perhaps a future Congress will introduce legislation that actually begins to cut back on the size and scope of government called the Fiscal Irresponsibility Act!

Tyler Durden
Mon, 06/05/2023 – 14:40

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History Suggests VIX Is Poised For Sharp Reversal

History Suggests VIX Is Poised For Sharp Reversal

As discussed yesterday, the VIX may be getting close to a bottom after hitting the lowest level in more than three years.


 
As Bloomberg’s Akshay Chinchalkar writes, the VIX collapsed by ~19% last week, the largest drop this year, as the debt-ceiling standoff was resolved and the mixed payrolls data for May diluted the odds of a rate hike this month.

The retreat means the VIX is more than 34% below its widely-followed 200-DMA. Such a significant divergence has typically marked a trough.

The VIX averaged a jump of 17% over the following 20 trading days when it hit or exceeded a difference of more than 30%, a decade of data show. More significantly, the index was higher after 20 days in 42 out of 44 instances where the difference was at least 30 percentage points.

VIX hopefuls also have seasonality on their side this month, with the volatility index pushing higher 80% of the time in June over the past 10 years.

Tyler Durden
Mon, 06/05/2023 – 14:20

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Kunstler: What’s Next

Kunstler: What’s Next

Authored by James Howard Kunstler via Kunstler.com,

“In this singular quest to win the Heartland the West has bankrupted itself – economically, morally, and most importantly, spiritually. This has led to a political crisis gnawing at the center of western society.”

– Tom Luongo, the Gold, Goats, and Guns blog

What’s next? You must be wondering because the psychopathic regime running our national affairs seems to be fresh out of trips to lay on us. One thing for sure, as the sweet zephyrs of springtime merge into the punishing infernos of summer, is that the collapse of the USA continues apace. You can debate whether it is a good thing or a bad thing, but above all it is the thing.

Have you forgotten our Ukraine project (Let’s you and him fight)? The idea was to bleed Russia dry because, you know… Russia! (They meddle in our elections… they collude with Trump… they tamper with our hopes and dreams….) It was years in the making, impeccably gamed-out in the State Department’s sub-basement. Secret Agent Man Hunter Biden, the then vice-president’s son, was even installed in the dark heart of Ukraine’s power center to… to do what, exactly? Never mind, because what secret agent men do is… secret!

The Ukraine bear trap was supposed to put Russia out-of-business for the foreseeable future. Didn’t work out. The crowning act of boobery was our demolition of the Nord Stream natgas pipelines, which had the predictable effect of putting our NATO allies out-of-business, while Russia turned around and found other customers for its gas. The sound of teeth gnashing down in Foggy Bottom might have kept “Joe Biden” up at night — except he was a hundred miles away on the beach in Delaware, medicated unto dreamland where it’s always 1964 and you’re tooling among the saguaros in your beloved Corvette, getting your kicks on Route 66.

So, let’s face it: Ukraine flopped. The main result of the Ukraine project is that it destroyed the tiny shred of what was left of America’s reputation for acting the global hegemon. In fact, Ukraine revealed that Russia has better weapons than we have (China, too) and that, given the emergence of hypersonic missiles, our gazillion-dollar aircraft carrier fleets are as obsolete as Roman triremes and liburnae. So, what’s our Plan B for defending Taiwan? (Hint: there is none.)

What’s next?

Western Europe, facing its own collapse, will turn on America and refuse to continue pretending it can help out in Ukraine. NATO falls apart. (What to do with those vacant office buildings and idle employees?) Europe will have enough problems with its cratering industries and banking system. It may even be obvious to a few heads-of-state that the best outcome is to simply allow Russia to pacify and demilitarize the age-old borderland. After all, for the rolling decades since World War Two, Ukraine was not a problem for anyone until America made it one.

There will be no face-saving for the “Joe Biden” regime, either, which is reaching its own collapse phase. Last week’s face-plant at the Air Force Academy was the harbinger of things-to-come. Today (Monday), FBI officials must walk over to the House oversight Committee an internal FD-1023 document revealed by a whistleblower to contain allegations of a Biden family $5-million bribery scheme with foreign actors. Of course, the substance of this criminal mischief is not news. What’s news is that the allegations contained in the doc come from a “trusted” confidential human source, meaning that, according to the FBI’s own rules, the allegation should have been dealt with expeditiously. Instead, the Bureau sat on it for three years. The FD-1023 doc is dated 2020, months before that year’s presidential election. The source is also alleged to be from Ukraine.

Will committee members be allowed to photo-copy the doc, or transcribe what’s in it? Wouldn’t it be amusing if Committee Chairman James Comer personally walks it over to the Xerox machine? What would the FBI officials do? Body check him? What if it turns out that the doc is full of redactions — blacked out. Like a big, fat practical joke from FBI Director Christopher Wray. (They’ve done it before.) Remember, Mr. Wray is already under threat of a contempt citation for stalling on this matter. But he’s obviously caught between that old rock and a hard place, since the doc appears to prove that, at least, the FBI has obstructed justice, and of the worst sort, a potential case of presidential treason. Mr. Wray may even be colored as an accomplice in it.

Or maybe it will all amount to nothing because all bad deeds go unpunished in the degenerate era that precedes collapse.  Even so, it seems the regime is running out of insults to launch against the people who consent to be governed by it. The national transexual struggle-session draws to a close with SecDef Lloyd Austin canceling the upcoming drag shows on our military bases. What else have they got?  Slavery reparations? Rep Cori Bush (D-MO) has introduced a bill to pay $14-Trillion to the descendants of slaves. I’m sure that’ll work, both as a unifying action to bring together the quarrelsome diverse peoples of our land, and as a purely fiscal measure.

The fate of the financial system will probably shove all of that aside, anyway. Everybody with more than half a brain is waiting for it to crack up, meaning a generalized vanishing of American wealth as expressed in cratering markets, failing banks, and a broken currency, in some vicious combo. Nothing else, it seems, can quite get the people’s attention.

*  *  *

Support this blog by visiting Jim’s Patreon Page

Tyler Durden
Mon, 06/05/2023 – 14:00

via ZeroHedge News https://ift.tt/gQwrP3e Tyler Durden

Listen Live: Elon Musk And RFK Jr. Discuss 2024

Listen Live: Elon Musk And RFK Jr. Discuss 2024

Robert Kennedy Jr., the pro-crypto, pro-border, pro-gun, anti-vax, Ukraine-skeptic Democrat 2024 challenger to President Joe Biden, is, for some reason, being heavily censored by mainstream press.

Enter Elon Musk, who will be hosting a “Twitter Spaces” event with RFK Jr. moderated by tech entrepreneur and investor David Sacks. Click image below to be directed to Twitter Spaces (no embed available). Let’s hope this goes better than the DeSantis discussion’s beginning.

According to Twitter co-founder Jack Dorsey, RFK Jr. is the best Democratic candidate. Dorsey endorsed Kennedy in a Sunday tweet, appearing to agree with the assertion that he can score a Democratic victory over GOP rivals Donald Trump and Ron DeSantis.

Kennedy who founded the anti-vaccine charity, Children’s Health Defense, was a strong early opponent of Covid-19 vaccine mandates, and was heavily censored on social media for speaking out against it. Prior to announcing his candidacy for 2024, Kennedy said that his “top priority” were he to become president would be to seek an end to “the corrupt merger between state and corporate power.”

He also told “Stay Free” podcast host Russell Brand that President Biden is ‘using Ukrainians for neocon political machinations.’

“And Ukraine today is a victim of U.S. aggression… because our government has admitted, President Biden has admitted that this, the old neocon asperation, this war is about getting rid of Putin, and [Biden’s] Secretary of Defense Lloyd Austin acknowledged in April 2022 that… the U.S. purpose of engaging this war is to exhaust and degrade the Russian army so they’re incapable of fighting anywhere else in the world. So that is our objective in this war. And it is a proxy war that is using the bodies of the flower of Ukrainian youth, putting them into an abattoir where they are being mercilessly killed.” 

They aren’t even admitting this, the Pentagon isn’t admitting this. The Ukrainian government doesn’t admit it. They have lost over 300,000 Ukrainian soldiers. Ukrainians are trying to leave Ukraine, and it is now illegal to leave Ukraine if you[‘re below 55 years of age and male.

And they’ve killed 14,000 civilians, there’s 60% unemployment, the infrastructure of the county has been destroyed for U.S. geopolitical machinations. And it is just not right. –RealClear Politics

Meanwhile, Kennedy is a big fan of crypto – calling Bitcoin an “innovation engine,” while criticizing Central Bank Digital Currencies (CBDCs) as tools that can “vastly magnify the government’s power to suffocate dissent by cutting off access to funds with a keystroke.”

On May 3, Kennedy also condemned the Biden administration’s proposed tax on crypto mining. He called the proposed 30% tax on energy used by crypto miners “a bad idea,” and claimed that while mining’s energy use was “a concern” it’s “somewhat overstated.” –Coin Telegraph

And Kennedy says he wouldn’t consider immigration amnesty until he’s sure the border is secure.

“I don’t think anybody can talk credibly about giving amnesty or any other of those allusions until we can assure Americans that the borders are closed,” he told the Epoch Times;

He called the question of amnesty a “secondary issue” to the broader matter of border security.

He added that it’s an issue that’s “a lot easier to solve, with a lot less poison and vituperation, if Americans know that the borders are now sealed.

I don’t think there’s anything we can do until we do that.”

Asked what his first actions in office would be if elected, Kennedy said he’d seek bipartisan consensus on important issues. The border was the first such issue that the nephew of President John F. Kennedy referenced.

“We all agree a nation can’t exist if it has a porous border,” Kennedy said.

The issue of an amnesty, Kennedy said, is one “that needs to be discussed after the border is closed. I don’t think any American is going to be happy with any solution until we make sure that you know, the border’s closed.”

Under President Joe Biden, illegal border crossings have reached never-before-seen levels, with as many as half a million illegal aliens coming in through the southern border with Mexico annually.

*  *  *

You can listen to the RFK-Musk conversation at the link in the first tweet.

Tyler Durden
Mon, 06/05/2023 – 13:50

via ZeroHedge News https://ift.tt/DXaYPp3 Tyler Durden

US Officials Belatedly Confirm NATO Weapons Used In Attacks On Russia

US Officials Belatedly Confirm NATO Weapons Used In Attacks On Russia

US officials have very belatedly confirmed that the dozens of gunmen who mounted a cross-border attack on Russia’s Belgorod from Ukraine on May 22 were using US and other NATO equipment, despite Washington’s long-running warnings for Kiev not to allow this to happen.

At least four US-produced MRAPs (Mine-Resistant Ambush Protected vehicles) were used in the attack, as well as anti-tank weaponry supplied from NATO countries, US officials have told The Washington Post. Three of the MRAPs had been provided directly by the US to Ukrainian national forces while one was given by Poland.

Two militia groups of anti-Kremlin Russians with links to neo-Nazis had claimed credit for the attack, and weren’t shy about showing off their US and NATO military hardware

Video released by the Russian Defense Ministry shows armored fighting vehicles in the Belgorod region following attack. Russian MoD/EPA via Shutterstock

The US sourcing of the equipment was obvious at the time given the abundance of videos circulating online and even being put out by the very fighters conducting the raids. Russian military video of destroyed equipment also added to the evidence.

At this point, the groups have apparently conducted multiple cross-border raids (most coming in the last two weeks), and their Nazi ties are so well-known and established that Western mainstream press reports can’t hide it even as the same media outlets seem to be positively celebrating the Belgorod attack itself

The Russian Volunteer Corps, or RVC, says it’s made up of Russians fighting on Ukraine’s side and against Putin’s government. The group made headlines in March when it claimed to be behind a smaller raid in the Bryansk region.

Its commander, Denis Kapustin, who also goes by the last name of Nikitin, is a white nationalist and ex-soccer hooligan who shares neo-Nazi views

But in the initial aftermath to the raid, the Biden administration sought to downplay and obfuscate the presence of NATO vehicles and weaponry. 

On the very day after the May 22nd attack, when asked about the American military hardware used by the attackers during a daily briefing, State Department Spokesperson Matthew Miller didn’t flat-out deny the allegations, but merely said the US administration is “skeptical, at this time, of the veracity” of the reports of US-provided weapons used to strike Russia in Belgorod. 

“We don’t have perfect clarity of the information, we’re looking at the same fuzzy images [on social media] … at this time we’re skeptical of their veracity,” Milller said

But RVC leader Nikitin himself told Financial Times his fighters were armed with MRAPs and US-made Humvees, though he’s since tried to backtrack, likely as a result of immense pressure from Kiev and Washington. 

Still, the Pentagon Discord leaks show that the Ukrainian government had been secretly planning covert attacks inside Russian territory using irregular militia fighters armed with “various qualitative types of NATO weapons”. Anyway it’s spun, Uncle Sam was caught red-handed in this instance. 

Tyler Durden
Mon, 06/05/2023 – 13:30

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The New York Times Thinks Preempting Local Control Is Bad—When Republicans Do It


Texas state house

The New York Times editorial board is furious that Republicans in state capitols are undermining democracy. This time they’re doing it by passing laws that preempt policies approved by Democratic-controlled city halls.

The Texas Legislature, it notes, approved a bill this session that would preempt localities from adopting regulations in areas already governed by the state codes for agriculture, natural resources, labor, finance, insurance, and occupations. If Gov. Greg Abbot signs the bill into law, localities could only regulate in those areas if they’re explicitly authorized to do so by state statute.

The Times editorial board claims this will preempt city regulations on subjects as mundane as overgrown lots and as serious as civil rights protections.

The cited source on the overgrown lots claim is the Texas Municipal League, a taxpayer-funded lobbying group controlled by local governments and dedicated to preserving local control. Business groups that support the bill argue that numerous parts of state law make clear that localities will retain their authority to regulate overgrown lawns, employment discrimination, and more.

No matter. The Times contends that Texas Republicans’ regulatory preemption, like so many other conservative efforts to centralize decision making in state legislatures, is “silencing the will of millions of voters.”

One might note that state legislators are likewise elected. In that context, the “will of millions of voters” in Democratic-controlled Texas cities isn’t necessarily silenced so much as it is being overridden by the will of millions of more voters who elected a Republican-controlled Legislature.

Obviously, there are winners and losers in the fight between state lawmakers and city council members, but the will of the voters as such is generally unaffected.

Centralization isn’t Republicans’ only sin, says the Times. They’re also hypocrites.

“Conservatives used to champion ideas like local autonomy,” the board writes. “What’s now become clear is that Republicans dislike local control if they are not in charge of it.”

That’s surely true. But if opportunistic support for the sanctity of local control is the issue, perhaps the editorial board should engage in a little self-reflection.

Just last year, the editorial board argued that the U.S. Congress, let alone state legislatures, should pass a law raising the minimum legal age to buy a semi-automatic weapon. Doing so would “silence the will” of not just millions of voters, but tens of millions of voters, who want to live in states and communities without that infringement on their gun rights.

For whatever reason, concerns about local control didn’t dominate the Times‘ thinking there.

Texas’ preemption bill, it notes, would allow citizens to sue local governments for trying to enforce local laws that are preempted by the state. To put it another way, the Texas bill cuts qualified immunity protections for local officials—something the Times editorial board has editorialized in favor of in other instances.

Indeed, the Times editorial board doesn’t even seem to be working with a consistent definition of state preemption.

For instance, it claims that only five states, including New York, allow local governments to adopt firearms regulations. This is only true in the sense that localities in those five states can pass laws that are more restrictive than what the state has established.  The will of voters in communities that would want looser gun laws is still being silenced.

New York’s assault weapons ban presumably “silences the will” of conservative upstate voters who’d be more inclined to allow more types of weapons to be possessed and sold in their communities. According to the Times, so long as localities retain their authority to pass even stricter regulations on guns in keeping with prevailing liberal opinion, local democracy is as safe and efficacious as it needs to be.

In a few brief paragraphs at the end of its editorial, the Times does agree that some local rules should give way to state preemption and mandates.

“There are cases where pre-emption laws are in the public interest: for example, when it becomes necessary for states to prevent their cities from creating or perpetuating injustices, to prevent discrimination and help citizens achieve fundamental rights like equal access to housing, employment and the ballot,” the board writes.

One could easily rework the above sentence to say something like, “There are cases where preemption laws are in the public interest: For example, when it becomes necessary for states to prevent violation of Second Amendment rights, to prevent overly burdensome taxation, and to protect fundamental rights like the right to earn a living.”

Are those rights really so much less important that they can’t be protected by state legislatures? The Times‘ answer is yes, because protecting those rights would interfere with liberal policy preferences.

When we talk about the division of powers between state and local governments, policy preferences really are the whole kettle of fish.

Liberals and conservatives are both eager to centralize power in state legislatures and governor’s mansions (to say nothing of Congress and the White House) when they run those institutions. They’re both quick to stick up for local control when they’re out of power.

Arguments predicated on the inherent competence of local governments over a particular issue area or their right to represent the will of local people are almost always pre-textual. The only real defenders of local control as a principle seem to be state leagues of cities (who are themselves funded by local governments and controlled by local elected officials).

Whether something should be a matter of local policy or state policy almost always boils down to a question of what you think good policy should be.

The Times article specifically defends the effort by New York Gov. Kathy Hochul to override local zoning restrictions in favor of more housing production as an example of preemption that is in the public interest.

Editorial board member Mara Gay has written a number of articles about how anti-growth residents (and the local governments they control) are making housing more expensive and less accessible for everyone, and, therefore, land use powers should be evolved to the state government.

These are arguments in favor of zoning reform first, and centralization as a means of achieving it second. I doubt either Gay or the editorial board would defend Gov. Ron DeSantis’ intervention to stop local zoning reforms in Gainesville, Florida, aimed at allowing more dense housing in single-family-only zones.

To be clear, this isn’t to defend every state preemption measure criticized by the Times editorial. Indeed, libertarians shouldn’t be too attached to one level of government. We’re interested in individual control (i.e. liberty), not local control, state preemption, or anything else.

(This is separate from the division of powers between the states and the federal government, which is defined in the Constitution. If you think having constitutionally limited government is good, you should want that balance protected, even if it doesn’t always give you the policies you want.)

Sometimes liberty is best protected by empowering local governments to act as a bulwark against the interfering tentacles of state officials. Sometimes state officials are the ones defending liberty from local despots passing income taxes, plastic bag bans, and rent control laws.

Sometimes preemption policies are a mixed bag: overriding some unjust local rules but imposing others at the state level. Figuring out when it makes sense to centralize power or devolve it can require careful thought.

But doing that careful thinking doesn’t imply that local governments have some inherent right to set policy because they’re “closest to the people” or whatever else.

Arguments about local democracy vs. state preemption are always about policy preferences and political expediency. Let’s not pretend otherwise.

The post <em>The New York Times</em> Thinks Preempting Local Control Is Bad—When Republicans Do It appeared first on Reason.com.

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