Month: January 2024

The risk off tone that has dominated the 2024 mood so far extended into a second session, and this time in addition to selling in both stocks and bonds, we are seeing crypto join the fray (the reason being attributed to this tweet). US equity futures and global market are experiencing some selling and profit-taking after the recent torrid Santa Rally, as we enter the first of several important macro data days: today the focus will be on ISM Mfg report and the December Fed Minutes. Interestingly, despite the weakness, yesterday’s US session saw a $7.8bn MOC to buy, and in its market intel note this morning (available to pro subscribers), JPM writes that for all the weakness “it does feel like there are buyers below current levels as the SPX struggles to breach 4,800.” That said, as of 7:45am, S&P futures were down 0.4% to 4,765, near yesterday’s session lows; Nasdaq futures dropped 0.7%. Bond yields are higher as we see bonds come for sale alongside stocks globally. 10Y Treasury yields rose to 3.98%, the highest since mid-December and a move above 4% will likely add more volatility to equity markets; the USD extended its gains; Brent jumped to session high around $77, rising form a sub-$75 low after Libya’s Sharara oil field unexpectedly shutdown amid mass protests, removing some 265K bpd in daily output although commodities overall remain mixed on concerns about China’s economy.

In premarket trading, all the megacap tech names are again lower in follow-on selling after yesterday’s AAPL’s downgrade which sent the stock tumbling almost 4%. Here are some other notable premarket movers:

• Ambarella Inc. shares are down 3.5%, after Wells Fargo Securities downgraded the chipmaker to equal-weight from overweight.
• Dyne Therapeutics rose 84% after it announced initial clinical data from Achieve trial in DM1 patients and Deliver trial in Duchenne muscular dystrophy patients.
• Mercury Systems slips 2.3% after Jefferies downgraded the defense company to underperform from hold saying its guidance “is in need of a reset.”
• Wendy’s falls 1.5% after Barclays cuts the fast-food restaurant operator to equal weight from overweight, seeing near-term challenges to accelerating unit and comparable sales growth.

US markets are poised to extend Tuesday’s slump, which saw the S&P 500 close lower by 0.6% and Nasdaq drop 1.7, registering as the biggest global rout since 1999 for the first full day of trading in a year. Wednesday’s data includes the ISM manufacturing report for December and the JOLTS report of job openings for November, followed by minutes from the Federal Reserve’s last meeting. The minutes will be of particular interest for investors because the December meeting was a key catalyst for the sharp rally in Treasuries, after Fed Chair Jerome Powell said that policymakers had discussed interest-rate cuts.

“It’s a very heavy data week — we have minutes, we have payroll, we have ISM,” said Adarsh Sinha, Bank of America Corp’s co-head of Asia FX & rates strategy on Bloomberg Television. “It’s natural investors are reducing some risks in some of the heavily crowded trades toward year-end.”

“We do not expect such sharp cuts to be supported by the discussion in the minutes, but we will be on the lookout for any mention of rate cuts, what would trigger them and how soon they might come,” said Karl Steiner, head of analysis at Skandinaviska Enskilda Banken AB.

European stocks have followed their Asian counterparts lower while bonds also add to Tuesday’s selloff. The Stoxx 600 falls 0.6%, led by declines in mining and consumer product shares. Defensive sectors advanced with consumer staples and healthcare outperforming the benchmark Stoxx 600 Index while tech shares lag behind. Here are the biggest European movers:

• Maersk extends gains, rising as much as 6.2% and lifting peers, after it decided to stop its ships from sailing through the Red Sea; Goldman Sachs upgrades the stock to neutral
• Novartis shares rise as much as 4.1% after agreeing a licensing deal with US biotech Voyager Therapeutics, with Vontobel seeing it boosting the Swiss firm’s gene therapy strength
• Atos surges as much as 12% after the French tech firm said it received an offer from Airbus for its cybersecurity and data unit, a deal that could potentially avoid heavy share dilution
• GSK gains as much as 2.8% after being upgraded to buy at Jefferies on near-term risk-reward ahead of potential Zantac class action settlements and misplaced concerns on 2024 growth
• Entain rises as much as 2.7% after appointing Ricky Sandler as a non-executive director with immediate effect. Analysts see the appointment as a positive for the share price
• Ryanair drops as much as 3.7% after the budget airline said the removal of its flights from several online travel agencies would reduce its load factor in the near term
• Wizz Air declines as much as 2.3% after revealing its load factor declined in December from the previous year, with Liberum noting this marks Wizz’s first decline in years
• Ashmore drops almost 5% after Numis downgrades to sell “with no obvious reason to own,” also seeing continued challenges within the wealth/asset management sector

“It’s not entirely surprising to see some of the tech stocks that very much propelled the market higher last year take a bit of a breather,” says Richard Saldanha, global equity fund manager at Aviva Investors. There’s value in sectors such as health care and consumer staples, “where earnings remain resilient and relative valuations are looking increasingly attractive,” Saldanha says. Saldanha notes the backdrop of lower inflation and potential for interest rates to come down from recent peaks should support markets, but there’s still a lot of uncertainty given the geopolitical backdrop and the US elections later this year.

Earlier in the session, in Asia, the MSCI regional benchmark sank 1.2% in the steepest retreat since November, driven by a selloff in technology stocks and as sentiment remains muted amid weakness in China; TSMC, Samsung and Alibaba were the biggest drags. Technology stocks tracked declines among Wall Street peers following a surge in Treasury yields. A gauge of tech stocks in Hong Kong dropped more than 2%. Stocks in Japan remained closed for a holiday. Asian equities have started the year on the back foot after a strong rally in the final quarter of 2023 as investors reconsider the potential scale of rate cuts by major central banks and China’s economic woes continue to weigh.

“Overall sentiment in the region has largely tracked the downbeat handover in Wall Street,” said Jun Rong Yeap, a market analyst at IG Asia Pte. “Focus will remain on economic data out of the US, alongside the Fed minutes, to provide cues on the Fed’s policy outlook.”

In FX, the greenback edged higher for a second day, with the Bloomberg Dollar Spot Index rising 0.2%. The Japanese yen is the weakest of the G-10 currencies, falling 0.5% versus the dollar with the USDJPY flirting with 143. The euro pared gains as Germany’s unemployment rate rose, while the Japanese yen sank for the second session.

“It’s a very heavy data week — we have minutes, we have payroll, we have ISM — so I think it’s natural investors are reducing some risks in some of the heavily crowded trades toward year-end like short dollar,” said Adarsh Sinha, BofA’s head of Asia FX & rates strategy on Bloomberg Television

In rates, we are selling continued weakness across the board. Treasuries extended Tuesday’s selloff with yields cheaper by 3bp to 5bp across the curve in a bear steepening move. 10-year TSY yields sit around 3.98%, cheaper by 5bps on the day and lagging bunds and gilts by around 4.5bp and 3bp in the sector as Treasuries lead global bonds lower; long-end led weakness steepens 2s10s, 5s30s spreads by 2bp and 1bp on the day

Another busy corporate issuance slate is expected for Wednesday’s session, follows almost $30b pricing Tuesday, while USD/JPY re-testing 143.00 adds to cheapening pressure on cash yields. Session ahead includes ISM manufacturing and JOLTS data. In the two-day pullback this year, long-end UK bonds have been among the hardest hit. Yields on 30-year UK government notes have risen 14 basis points, more than their US and German equivalents. Investors are ditching long-end gilts to free up cash before the UK sells new debt that may have a higher coupon.

Looking at today’s calendar, US economic data includes December ISM manufacturing and November JOLTS job openings (10am). Fed members scheduled to speak include Barkin at 8:30am; FOMC minutes release is scheduled for 2pm. The Federal Reserve will release minutes of its December meeting — when policymakers had surprised markets by signaling a pivot from rate hikes — later Wednesday while US jobless claims, nonfarm payrolls and factory orders are among the data points due by the end of the week.

Market Snapshot

• S&P 500 futures down 0.2% to 4,778.75
• MXAP down 1.0% to 166.42
• MXAPJ down 1.3% to 517.93
• Nikkei down 0.2% to 33,464.17
• Topix up 0.2% to 2,366.39
• Hang Seng Index down 0.8% to 16,646.41
• Shanghai Composite up 0.2% to 2,967.25
• Sensex down 0.7% to 71,399.28
• Australia S&P/ASX 200 down 1.4% to 7,523.20
• Kospi down 2.3% to 2,607.31
• STOXX Europe 600 down 0.3% to 477.24
• German 10Y yield little changed at 2.07%
• Euro little changed at $1.0941
• Brent Futures down 0.8% to $75.32/bbl
• Gold spot down 0.0% to $2,058.56
• U.S. Dollar Index little changed at 102.28

Top Overnight News

• Two of China’s biggest state-owned banks and a leading joint-stock bank have stepped up reviews of smaller lenders over the past couple of months to identify those with poor asset quality and have a high risk of default. The two state-owned banks have decided to reduce interbank lending limits and set shorter maturity periods for smaller peers deemed high risk, said two of the sources. RTRS
• A Chinese Communist Party newspaper has urged the country’s regulators to end their erratic moves against the platform economy, in a sign of growing concern over policy damage to the health of the country’s ailing internet titans. A front page opinion piece published by the Study Times, the mouthpiece of the Central Party School, on Wednesday argued that regulators must stop the practice of swinging between extremes of lax oversight and “overly strict” regulation so that China’s Big Tech firms can have room to grow. SCMP  
• EU regulators will dig deeper into the links between banks and other financial firms such as hedge funds, said the chair of the European Banking Authority, as concerns mount about the potential for contagion from stresses in the wider system. FT
• The EU has added Russia’s state-owned Alrosa, the world’s largest diamond miner, to its sanctions list along with the company’s chief executive Pavel Marinychev. FT
• Oil’s facing a glut this year as production from non-OPEC+ countries like the US runs ahead of demand and traders are skeptical the cartel will be able to implement cuts. BBG
• US national debt tops $34T for the first time, with $1T added in just the last three months. WaPo
• Republican House majority will shrink to 2 following Ohio lawmaker’s early resignation (the resignation will leave the House with 219 Republicans and 213 Dems, which means the GOP can only lose two people on party-line votes). The Hill
• Issuance of convertible debt climbed by 77% last year to $48bn, according to data from LSEG, making it one of the only areas of capital markets to return to pre-pandemic averages after 2022’s market downturn. Experts say the boom in convertibles, a type of bond that can be swapped for shares if a company’s stock price hits a pre-agreed level, is likely to continue this year as companies refinance a wave of maturing debt. FT
• The killing on Tuesday night of a senior Hamas leader marked the biggest hit to the group’s top leadership in years, taking out a key player who was responsible for aligning the Palestinian militant group with Iran and Iran’s proxy Hezbollah. Saleh al-Arouri was killed in Beirut in a suspected Israeli strike, although Israel hasn’t officially claimed responsibility. WSJ
• Manhattan home prices rose for the first time in more than a year, as surging high-end sales propelled the market and lower mortgage rates set the stage for a broader recovery in 2024. Purchases closed at a median of $1.16 million in the fourth quarter, up 5.1% from a year earlier, according to appraiser Miller Samuel Inc. and brokerage Douglas Elliman Real Estate. It was the first annual increase since the third quarter of 2022, the firms’ data show. BBG

A more detailed look at global markets courtesy of Newsquawk

Asia-Pac stocks were mostly lower as sentiment reverberated from Wall Street’s downbeat performance despite the lack of a clear driver, while Japanese markets were away on a market holiday. ASX 200 saw the deepest losses in gold names following the recent surge in the Dollar, while Tech also lagged, mimicking the sectoral performance on Wall Street. KOSPI extended its downside with semiconductor names among the biggest losers – Samsung Electronics tumbled 3% at one point. Hang Seng and Shanghai Comp were mixed with the former’s losses led by large-cap Hong Kong stocks also listed in the US (JD.com -4.2%, Baidu -3.0%, Alibaba -2.7%), while Mainland China fluctuated between modest gains and losses, but was ultimately cushioned by stimulus speculation in Chinese press.

Top Asian News

• China is expected to persist in reducing interest rates and the reserve requirement ratio (RRR) throughout 2024, according to the China Securities Journal. Economic Daily reported that additional policies aimed at stabilizing the economy are anticipated to be implemented in China.
• PBoC injected CNY 14bln through 7-day reverse repos at a maintained rate of 1.80% for a net drain of CNY 558bln, according to Reuters.
• Japan reported an earthquake with prelim. magnitude of 5.5, no tsunami warning has been issued after the earthquake, according to NHK.
• Australia PM Albanese said his government would consider new cost-of-living relief measures ahead of the May budget without stoking inflation, according to Reuters.
• Some of China’s large banks tighten interbank lending standard for smaller peers to mitigate credit risk, via Reuters citing sources

European equites, Eurostoxx50 (-0.8%), extend losses in-fitting with the negative risk tone and subdued APAC trade overnight. Pressure which has increased throughout the session despite limited newsflow, though US Futures remain around the APAC low pre-data/minutes. European sectors hold a negative bias; Optimised Personal Care Drug and Grocery is generally lifted by UK supermarkets following a positive Kantar update. Basic Resources suffers from weaker commodity prices. US Equity Futures are lower across the board, though with losses comparably more contained ahead of key US data; RTY (-0.6%) continues yesterday’s underperformance; NQ & ES -0.2%.

Top European News

• Kantar UK Supermarket Update (Dec): Supermarkets saw their highest level of transactions in December since 2019. Grocery price inflation fell to 6.7% in December, its lowest level since April 2022.
• Atos in Early Talks to Sell Cybersecurity Business to Airbus
• Citi’s Manthey Says European Stocks Face Risks After Bullish Run
• German Unemployment Up Less Than Expected After Worker Shortages
• Maersk, Shipping Peers Jump on Red Sea Halt, Goldman Upgrade
• Wizz Air Drops as Load Factor Brings Capacity Concerns: Liberum
• Italy Weighs $1 Billion Package to Boost Electric-Car Sales
• European Council Adds Alrosa, CEO Marinychev to Sanctions List

FX

• DXY is firmer and trades towards the upper end of a 102.07-40 range; traders will await key US data. Thus far, the index has eclipsed the 21-DMA and approaches 21st Dec high (102.45), 102.50, 20th Dec high (102.54), and the 19th, 18th and 15th Dec highs (at 102.63, 102.63 and 102.64 respectively).
• EUR holds around the unchanged mark and trades on either side of 1.0950 after finding support near its 21 DMA at 1.0937.
• The Yen is the G10 underperformer continuing yesterday’s losses as USD/JPY advances to a high of 142.79.
• The Antipodeans are once again divergent, with the Kiwi holding around flat, whilst the Aussie slips; in a reversal of yesterday’s price action, AUD/NZD falls back below 1.08.
• PBoC set USD/CNY mid-point at 7.1002 vs exp. 7.1512 (prev. 7.0770)

Fixed Income

• USTs are pressured, in-fitting with the broader risk tone with yields bid across the curve as attention turns to FOMC Minutes and speak from Fed’s 2024 voter Barkin.
• Bunds continues yesterday’s losses and overall unreactive to the German unemployment data; though, as the risk tone sours more broadly EGBs have bounced from lows, but Bunds remain shy of 137.00 and Tuesday’s best above that.
• Gilts follow EGB and UST price action with the docket sparse on the UK front; session trough at 101.23 remains comfortably above the prior day’s worst at 101.08.
• Germany sells EUR 3.56bln vs exp. EUR 4.5bln 3.1% 2025 Schatz: b/c 1.82 (prev. 2.48x), average yield 2.44% (prev. 2.64%), retention 20.9% (prev. 18.67%)
• Mexico has placed USD 7.5bln in 5-year, 12-year, and 30-year bonds, according to the Finance Ministry cited by Reuters. Demand for the bond offering reached USD 21.3bln.
• Indonesia has launched 5-year, 10-year, and 30-year Dollar bonds at 4.9%, 5.05%, and 5.45%, respectively, according to the term sheet cited by Reuters

Commodities

• WTI and Brent continue to pullback with the complex taking cues for recent Dollar strength and the overall sour risk tone.
• Spot Gold price action is contained though has tilted slightly lower amid firmer Dollar; Base Metals are lower amid negative sentiment in APAC trade overnight.
• UBS forecasts higher spot crude prices this year. Forecasts Brent recovering to USD 80-90bbl and WTI in the USD 75-85bbl range.
• Indian Oil Minister says domestic firms will invest USD 67bln to bolster nat gas infrastructure by the next 5-6yrs; Says they are purchasing 1.5mln BPD of Russian oil.
• Iraq’s oil exports averaged 3.5mln BPD in December, average price of USD 76.96/bbl, via the Oil Ministry.

Geopolitics

• The US has reportedly reached an agreement with Qatar that extends the American military presence at the biggest base in the Middle East – al Udeid – for another 10 years, sources told CNN’s Marqu.
• US CENTCOM said on January 2, Iranian-backed Houthis fired two anti-ship ballistic missiles from Houthi-controlled areas in Yemen into the southern Red Sea, according to Reuters. Multiple commercial ships in the area reported the impact of the anti-ship ballistic missiles (ASBMs) into the surrounding water, although none have reported any damage.
• A senior Chinese official has stated that the upcoming elections in Taiwan (13th Jan) are an important choice between peace and war, prosperity and recession, according to state media.
• Iranian president is set to visit Turkey on Thursday, according to journalist Aslani.

US Event Calendar

• 07:00: Dec. MBA Mortgage Applications -10.7%
• 10:00: Nov. JOLTs Job Openings, est. 8.82m, prior 8.73m
• 10:00: Dec. ISM New Orders, est. 49.1, prior 48.3
• 14:00: Dec. FOMC Meeting Minutes

DB’s Jim Reid concludes the overnight wrap

Welcome back and hope you all had a great Christmas and a happy New Year. Since we’ve been away, markets have continued to advance for the most part, with the S&P 500 having now posted 9 consecutive weekly gains for the first time since 2004. However, when it came to the first trading day of 2024 yesterday, markets have fallen back again, with the S&P 500 down -0.57%, whilst the NASDAQ saw a larger -1.63% decline. That decline has continued overnight as well, with the major equity indices in Asia all trading lower.

There have been several factors behind the moves, but an important one was growing scepticism about the chance of near-term rate cuts. For instance, at the end of 2023, futures were fully pricing in a Fed rate cut by March, but after yesterday’s session that had been dialled back to a 87% probability and overnight it has further moved lower to 85%. Likewise at the ECB, the chance of a cut by March has fallen from 71% last Thursday, to 61% yesterday and 59% overnight. Clearly, investors are still pricing in a Q1 rate cut as more likely than not, but there’s been a bit more doubt over the last 48 hours as to whether the aggressive rate cuts priced for 2024 will actually end up happening.

That shift prompted a decent sell-off for sovereign bonds on both sides of the Atlantic, with yields on 10yr Treasuries up +5.0bps to 3.93%. That was particularly evident at the front-end, where the 2yr yield was up +7.0bps to 4.32%. And the effects were clear among other asset classes, sine the dollar index (+0.86%) saw its strongest daily performance since July. Meanwhile in Europe there was a similar pattern, with yields on 10yr bunds (+4.5bps), OATs (+3.9bps) and BTPs (+2.4bps) all rising .

Another factor which dampened sentiment were growing signs of geopolitical risk and the potential impact on supply chains. For instance, yesterday saw the container shipping company Maersk announce that they would be pausing all transit through the Red Sea and the Gulf of Aden “until further notice”. They had already announced a pause until January 2, but the latest statement didn’t put a date on how long it would last. That follows incidents where commercial vessels have come under attack in the Red Sea, which has already led to significant shipping diversions. Brent crude oil prices had been up by more than 2% earlier in the session, but with the broader decline in risk appetite later in the session, they ended the day down -1.49% at $75.89/bbl .

Elsewhere, the data releases from yesterday didn’t really help matters either. Among others, we had the final manufacturing PMI from the US, which was revised down three-tenths from the flash reading to 47.9. To be fair, the picture looked slightly better in the Euro Area, where the manufacturing PMI was revised up two-tenths, but that still left it at a contractionary 44.4, having now remained beneath the 50 mark since June 2022.

All that meant markets got 2024 off to a rough start, with the S&P 500 (-0.57%) down for a second consecutive session, whilst Europe’s STOXX 600 also fell -0.10%. Big tech stocks led the declines, which meant the NASDAQ (-1.63%) and the FANG+ Index (-2.36%) posted significant losses. And there was a decent widening in credit spreads too, with US HY spreads widening by +10bps to 333bps .

Overnight in Asia, that negative trend has continued this morning, with losses for the KOSPI (-2.10%), the Hang Seng (-1.09%), the CSI 300 (-0.66%) and the Shanghai Comp (-0.26%). I n Australia, the S&P/ASX 200 is also down -1.37%, whilst markets in Japan remain closed for a holiday. US equity futures are pointing lower as well, with those on the S&P 500 down -0.07%.

Looking forward, today should offer some more clues on the rate cut speculation, since we’ve got the FOMC minutes from the December meeting out later. That meeting helped turbocharge the year-end rally, since the median dot from officials pencilled in 75bps of cuts this year, and Chair Powell didn’t push back on the rate cut discussion either. In fact, he said that “we’re very focused on not making that mistake” of keeping policy tight for too long. So all eyes will be on any mentions of rate cuts or easing policy.

As well as the Fed minutes, today will also bring the latest ISM manufacturing report for December, along with the JOLTS report of job openings for November. So far at least, the JOLTS has broadly pointed to an easing in labour demand, but to levels that are still consistent with a soft landing. So it will clearly be a good sign for the economy if that momentum can be maintained. Later in the week, we’ll get the US jobs report for December on Friday. Our US economists are looking for a +150k gain in nonfarm payrolls, with the unemployment rate ticking up slightly to 3.8% .

More broadly as we look to the year ahead, it’s clear that several themes are set to feature on the agenda. A big one will be politics, as there are lots of elections scheduled around the world in 2024. One of the most important will be the US Presidential election on November 5, and the current polling averages from FiveThirtyEight still suggest that Joe Biden and Donald Trump are the clear frontrunners for their party’s nominations. That would set up the first direct re-match in a presidential election since 1956. Moreover, attention is likely to shift onto US politics well ahead of November, as the first primaries are taking place later this month. On the Republican side, the Iowa Caucus is happening on January 15, which is then followed by the New Hampshire primary for both parties on January 23.

Meanwhile on the macro side, a big question we’re watching in 2024 is whether a soft landing can be achieved. Clearly the inflation readings have surprised on the downside of late, but we also know that monetary policy operates with a lag and there are still plenty of vulnerabilities. And even as growth surprised on the upside in 2023, several leading indicators of a recession are still pointing in a more negative direction, such as inverted yield curves, or the fact that Temporary Help Services payrolls in the US (a leading indicator in previous cycles) have kept declining. This is why we called our 2024 World Outlook “The Race Against Time…” (link here), as the question is whether rates can fall and lending standards ease quickly enough for there not to be a funding accident.

And lastly, although there are plenty of things we know are going to happen like elections, most years normally see plenty of events materialise that are unexpected surprises at the start. That’s certainly been the pattern in recent years, not least with 2020, when we had the pandemic and an incredibly sharp economic contraction. Then in 2021, inflation returned in a big way for the first time in decades. In 2022, that was then followed by the fastest rate hikes since the early 1980s, whilst Russia’s invasion of Ukraine meant that geopolitics became a significant factor for markets again. Even in 2023, although there wasn’t a single event that dominated in markets, there were still plenty of surprises that occurred along the way, including the regional banking turmoil in March, major excitement about AI from the spring, central banks staying hawkish, and then a phenomenal year-end rally as hopes mounted about a soft landing and potential rate cuts this year. Let’s see what 2024 has in store for us, but recent years have certainly taught us to expect the unexpected.

Looking at the day ahead now, US data releases include the ISM manufacturing reading for December, along with the JOLTS job openings for November. In Germany, there’s also the unemployment report for December. Meanwhile from the Federal Reserve, we’ll get the minutes from the December FOMC meeting, whilst Richmond Fed President Barkin is speaking.

Authored by Frank Miele via RealClear Wire,

Ladies and gentlemen, start your election engines.

Ready or not 2024 is here, and that means you are in for the ride of your life! The all-important Iowa caucuses are here in just two weeks, and by the end of the month New Hampshire voters may have slammed shut the door for any candidate other than Donald Trump to grab the Republican Party presidential nomination.

But that’s all right, we don’t need plain politics to make this election year interesting. For that we have the Democrats’ rigged indictments and novel legal theories. There are four criminal trials scheduled throughout the year, any one of which could force Trump off the campaign trail long enough to significantly alter the election. Then there is the absurd effort to remove Trump from the ballot in multiple states due to an inventive reading of the 14^th Amendment’s ban on Confederate rebels holding office in the U.S. government.

And if that weren’t enough, House Republicans have ordered up an impeachment inquiry against President Joe Biden that will compete with Trump’s legal woes for your attention. Does the GOP with its slim majority in the House have enough votes to actually impeach Biden? Possibly not, but it may not matter as long as the mainstream media covers the inquiry with a degree of fairness. There is nothing appetizing about the Bidens’ dealings with foreign entities over the last two decades, and voters may choose to spew out their already lukewarm affection for the Democratic candidate.

So where to begin?

It has to be declared upfront that the election cycle takes precedence over the legal cycle and even the impeachment cycle. Remember, there is nothing to prevent Trump from running for president even if he is a convicted felon. There is nothing to prevent him from taking office if he is a convicted felon. So the only way such a conviction might impact the election is if voters reject the former president as a result of something they learn from the legal proceedings that turns them against Trump.

But as I showed in my last column, voters are already well informed about Trump’s eccentricities, and they prefer him over more “normal” candidates. Instead, they became even more enthusiastic about Trump’s candidacy as soon as the Deep State brought its first indictment against him in March of 2023. The verdict that matters is already in: A plurality of U.S. voters apparently agrees with Trump that the legal persecution being waged against him is election interference, and they aren’t happy about it.

So let’s focus on the likely outcome of the Iowa GOP caucuses on Jan. 15 and ponder how the election race might proceed from there. A Fox Business poll on Dec. 20 was typical. Trump led with 52%, Ron DeSantis had 18%, and Nicki Haley had 16%. Everyone else trailed badly. To put it plainly, the poll shows Trump leading by 34 percentage points, a lead which is virtually unheard of in a contested primary. It is highly unlikely that Trump will lose, and if his lead remains anywhere near 34 points on Caucus Day – and he runs the table in New Hampshire eight days later – then the race is effectively over.

What the Never Trump forces seem to be counting on is a late “surge” by Nikki Haley. The trend as seen on RealClearPolitics is that Haley has either tied or leads DeSantis in Iowa. If she manages to secure second place in the caucus state, she would try to turn that into a momentum boost in New Hampshire, where she is already generally acknowledged to be in second place, although down by 21 points to Donald Trump, according to the RealClearPolitics Average.

But let’s be realistic. Haley is a media darling, but she hasn’t caught on among conservatives, and her path is winding and unlikely. It’s DeSantis who has won the endorsement of Iowa Gov. Kim Reynolds and Iowa’s leading social conservatives. That wouldn’t be enough to help him surpass Trump, but the power of an on-the-ground political machine could easily help him hold off Haley for second place. Should that happen, Haley would be deprived of her boost going into New Hampshire and would likely be a distant second-place finisher to Trump.

Even if Haley somehow finishes in a strong second place, it would have the opposite effect of what she hopes. A DeSantis collapse in Iowa, where the Florida governor has pinned all his hopes, would be devastating for his candidacy. With his donors abandoning him, DeSantis would very likely withdraw before New Hampshire, sending a large number of voters back into Trump’s arms and hurting Haley at a crucial moment.

The other scenario that could play out in New Hampshire is that Chris Christie, who has positioned himself as a one-man Trump wrecking crew, gets out of the race and endorses Haley. That could certainly help her, but it might be countered by an endorsement of Trump by Vivek Ramaswamy, the outsider candidate who touts himself as Trump without the baggage. Besides, Christie’s ego probably won’t let him step aside until he’s bankrupted his super PAC and exhausted his options. And after Haley’s odd flub on the causes of the Civil War, Christie noted caustically, “She’s unwilling to offend anyone by telling the truth.” Not exactly endorsement language.

Which brings us to South Carolina. Did I mention that Haley is the former governor of South Carolina, and is counting on its Feb. 24 primary one month after New Hampshire to cement her as the legitimate challenger to Trump? But that could only happen if she wins in her home state. If she loses there, she is toast. And if she has any hopes of running for president successfully in the future, that is a fate she cannot endure.

Therefore, if she comes out of New Hampshire with no momentum, she may withdraw from the race before her home state votes to avoid an embarrassing loss. And since Trump has a 30-point lead over Haley in the RealClearPolitics Average for South Carolina, embarrassment is the most likely outcome. Gov. DeSantis, if he is still in the race after New Hampshire, is no more likely to see a path to the nomination after South Carolina, where he trails by 38 points.

And remember, this all takes place before Trump is required to set foot in any courtroom. Moreover, Trump’s appeals and his legal motions have made it almost impossible that there will be any trial on election interference before the election. That leaves only the case brought in New York by District Attorney Alvin Bragg as a threat to Trump, but is it a real threat? Bragg has pieced together a case against Trump based on a vague legal theory that he hid payments to porn star Stormy Daniels that were paid through his attorney Michael Cohen. I won’t bore you with the details, but suffice it to say, if CNN is willing to publish an op-ed calling the case weak, then there is a good chance it will be dismissed outright or end with a mistrial or acquittal.

It was Bragg’s case that kicked off all the legal shenanigans against Trump, and which boosted Trump in the polls because it appeared to be a political attack rather than a legitimate criminal case. Therefore, even if Bragg should gain a conviction (which would likely be overturned by the Supreme Court after the election) it will just strengthen the argument that Democrats will do anything to stop a candidate they cannot beat at the polls.

Realistically, there is only one thing that could prevent Donald Trump from winning the GOP nomination and very possibly from reclaiming the White House – and that is Donald Trump. His willingness to say anything for attention (such as “dictator on Day One only”) has the potential to backfire when Democrats seize on it. Of course, Day One is when a new president issues multiple executive orders to counteract existing policies. Obama did it. Biden did it, and yes Trump will do it, too, if he gets a chance. That is not being a dictator, but the mainstream media will twist it into the latest evidence that Trump is Hitler. We know the Democrat playbook, and it’s dirty politics through and through.

If Trump gives them an opening, they will be entirely happy to shut him down. Otherwise, the year 2024 belongs to Donald Trump.

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

After prices jumped in 2023, gold is entering 2024 with many experts suggesting the safe haven asset could hit record highs this year.

In 2023, gold prices jumped from around $1,823 per oz. to $2,062 per oz.—an increase of over 13 percent—making it the best year for the yellow metal since 2020. On Dec. 4, gold hit a record-high price of $2,135.40 per oz. For 2024, experts predict gold prices to move higher.

“Following on from a surprisingly robust performance in 2023, we see further price gains in 2024, driven by a trifecta of momentum chasing hedge funds, central banks continuing to buy physical gold at a firm pace, and not least renewed demand from ETF investors,” said Saxo Bank’s Ole Hansen, according to Reuters.

JP Morgan predicts gold to see a “breakout rally” starting in the middle of this year due to Federal Reserve’s interest rate cuts. The bank expects gold to hit a peak of $2,300. Meanwhile, UBS projects gold prices to hit $2,150 by the end of this year if the rate cuts were to take place.

Gold saw major ups and downs in 2023, as one event after another affected investor perception. In May, the U.S. banking crisis pushed gold down to a low of $1,810 per oz. by early October. However, the Hamas attack on Israel that month triggered tensions and gold prices have been rising since then.

In November, the SPDR Gold Shares ETF, a popular exchange-traded fund tracking gold, saw net inflows of more than $1 billion, breaking five consecutive months of outflows. This was also the strongest month of net inflow since March 2022,

An Oct. 31 update by the World Gold Council (WGC) revealed that global central banks collectively bought “an astonishing” 800 tons of gold in the first three quarters of 2023. This is a 14 percent increase in gold buying compared with the same period last year.

A May 30 survey published by the organization found that a majority of central banks expect the proportion of their total reserves denominated in gold to increase over the next five years, thus contributing to upside pressure on gold prices.

Gold and Economic Scenarios

The WGC has three different predictions for gold rates this year depending on how the economic scenario plays out, according to its Gold Outlook 2024 report.

If there is a “soft landing” of the U.S. economy, which WGC attributes a 45 to 65 percent probability, the organization expects gold prices to remain “flat with upside potential.”

In the less probable “hard landing” scenario—25 to 55 percent probability—WGC expects gold prices to move “notably higher” and hit a new record high.

If the U.S. economy sees a “no landing” scenario where inflation and economic growth reaccelerates, WGC foresees gold prices to remain flat and face downside pressure. The “no landing” scenario has the lowest probability at just 5 to 10 percent.

“If the no-landing scenario does occur, it could prove initially challenging for gold. While positive economic growth would support consumer demand and higher inflation would increase the need for hedges, it is likely that the combination of higher rates and a stronger US dollar would create a drag, as they did in September 2023,” WGC said in the report.

“But if inflation surged again, it could elicit an even stronger monetary response—leading us back to the spectre of a hard(er) landing further down the line and a strong case for strategic gold allocations.”

In 2024, WGC expects major global elections in the United States, India, European Union, and Taiwan to be a geopolitical risk. As such, “investors’ need for portfolio hedges will likely be higher than normal.”

“The probability of a recession is not insignificant. From a risk-management perspective, this would provide strong support to the case of maintaining a strategic allocation to gold in the portfolio.”

Downside Risks

While many experts are bullish on gold, some advise exercising caution. In an interview with Yahoo Finance last month, Rob Haworth, senior investment strategy director at U.S. Bank Asset Management Group, pointed out that lower interest rates and investor hopes for Fed rate cuts have contributed to surging gold prices.

“A key question for bullish gold investors is whether these trends can be sustained. A still-growing U.S. economy and few signs the Fed is close to considering interest rate cuts are likely to temper near-term enthusiasm for gold.”

Opimus CEO Octavio Marenzi also warned investors against blindly betting money on gold after seeing the recent spike.

“The biggest mistake is sort of chasing the market and [being] a day late into getting the hot investment classes after they’ve had a big rally and a big pop,” he said.

A key factor for gold prices would be the strength of the U.S. dollar. The dollar is typically inversely related to gold prices. As such, a strong dollar could restrict the upside movement of gold prices or even contribute to a decline.

JP Morgan is expecting the U.S. dollar to remain at “elevated levels” in 2024, suggesting that it could even hit “new highs.”

Real America’s Voice host Ben Bergquam published a video on social media platform X that exposes what is described as a ‘guerrilla camp’ on the southern border, operated by radical leftist groups, which are aiding in the illegal migrant invasion by cartels.  

“OK, here is the whole video. You have to watch it all – it just gets worse and worse! Leftists caught directly aiding and abetting the invasion of our country the wall in Sasabe, Arizona,” Bergquam wrote on X. 

He continued: ” These are some of the same people that we previously exposed harboring illegals at their camp in Arivaca. How do we save our country when we allow enemies within to do this? When we take power back, these organizations must be defunded and prosecuted.” 

OK, here is the whole video. You have to watch it all – it just gets worse and worse! Leftists caught directly aiding and abetting the invasion of our country the wall in Sasabe, Arizona. These are some of the same people that we previously exposed harboring illegals at their… pic.twitter.com/Z0RmDOwQup

— Ben Bergquam – Real America’s Voice (RAV-TV) News (@BenBergquam) January 1, 2024

Last week, a separate report from the new website Muckraker revealed a network of NGOs, or non-governmental organizations, were playing a powerful role in coordinating the large-scale invasion of illegals at the southern border.

Illegal Alien Invasion Maps Exposed – CRITICAL THREAD EXPOSING NUMEROUS MASS MIGRATION BLUEPRINTS

Muckraker has obtained multiple maps, handed out by non-government organizations across South and Central America, that detail the routes to take to the U.S. and where to cross the… pic.twitter.com/wt0DDslM4w

— Muckraker.com (@realmuckraker) December 23, 2023

“A lot of NGOs are helping Biden open the border to unlimited illegal crossing. But none of this could happen without the president’s approval,” Byron York, the chief political correspondent at the Washington Examiner, recently said. 

A lot of NGOs are helping Biden open the border to unlimited illegal crossing. But none of this could happen without the president’s approval. https://t.co/cDTRQGgtUp

— Byron York (@ByronYork) December 21, 2023

The Biden administration, meanwhile, has been deliberately downplaying the border crisis – which they created with a virtual invitation for migrants to pour into the country after striking down several Trump-era border protections on day one.

Karine Jean-Pierre claims the border crisis is “not unusual.”

FACT CHECK: This is the worst U.S. border crisis on record, by far. pic.twitter.com/LheysOgg1O

— GOP (@GOP) December 23, 2023

New data from Fox News shows a record 302,000 encounters with illegal migrants occurred in December, which marks 785,000 encounters since Oct. 1.

It appears Democrats might be funneling taxpayer funds into radical leftist groups, which are reportedly assisting cartels in America’s invasion. 

Authored by Christopher Roach via American Greatness,

The United States used to be the undisputed international shot caller. Twenty years ago, we were number one economically and militarily. There were no real “peer competitors.” But lately, our power is in doubt.

The United States has deployed warships to stop Yemen’s harassment of commercial shipping destined for Israel, as well as to prevent direct missile attacks on Israel itself. Yemen is a poor and war-torn nation hobbled by severe sanctions and a years-long bombing campaign by Saudi Arabia. The United States has provided the Saudis with weapons and logistical support since 2015. Remote, impoverished Yemen’s civil war concerns the United States because one of the belligerents, the Houthis, acts as a proxy for Iran.

In spite of sanctions and years of war, Yemen’s Houthis have established firm control over the country’s south and managed to accrue an asymmetric drone warfare capability. One may recall Yemeni drone attacks on Saudi oil infrastructure just a few years ago. These same weapons have now been deployed against Israel and in defense of Yemen itself.

Naval Power is Important to Maintaining American Sovereignty

The United States tried and failed to build a naval coalition to stop the Houthi’s interdiction of shipping en route to Israel. At first, the Pentagon announced Operation Prosperity Guardian with great fanfare. But soon it scaled back the operation, admitted a lack of sufficient ships, and sustained a prestige hit when France, Spain, and Australia all dropped out of the planned operation.

While taking sides in the Israeli-Palestinian conflict seems ill advised—the Middle East is consistently a tar baby that the U.S. obtains no advantage from engaging with—American control of the seas, the preservation of open shipping lanes, and our ability to influence the actions of other nations are important elements of American power. The security of the oceans will always be a legitimate foreign policy priority for a commercial and maritime republic like the United States.

A lot has changed in the last 20 years. In 2003, even though the Iraq War was very controversial abroad, the United States lined up over 30 countries to help, including stalwart allies like the United Kingdom and Australia, as well as smaller countries seeking favor, including Georgia, Poland, Ukraine, Romania, and even Honduras and the Dominican Republic. Of course, when necessary, the United States went completely alone, as with the Libyan bombing of 1986 or the Panama Invasion of 1989.

But this recent history is instructive. Just a mere 20 years ago, the U.S. projected significant power, commanding the rest of the world’s respect and often its cooperation. This often led to the imposition of favorable terms in any international dispute. Even when the Ukraine war began, the U.S. was able to strongarm Europe into an aggressive sanctions regime against Russia. Germany even remained silent when Ukrainian (or American) saboteurs blew up the Nord Stream natural gas pipeline, on which German industrial output depended.

Signs of Decline

But cracks in U.S. dominance are beginning to show. 

For starters, the ignominious withdrawal from Afghanistan in 2021 was a stark display of American weakness and fecklessness. Many years of happy talk and billions of dollars deployed for nation-building went up in smoke within a fortnight.

The departure could not have possibly been more chaotic and humiliating, and it was a direct result of the uniformed military’s attempts to stay in Afghanistan indefinitely, even after the Taliban and the United States signed a treaty requiring our troops’ departure. When our people should have been packing up their trash and destroying sensitive equipment, nothing was happening. Describing this withdrawal and the introduction of thousands of illiterate Afghanis into our country as some great success was the icing on the cake. This reminded us that the military and its leadership are lately far more concerned with image than with winning wars.

A second crack in America’s reputation arises from the Ukraine War. This war began with a lot of bravado about the strength of the NATO alliance, and the Biden administration stated its goal of fomenting regime change in Russia and otherwise reducing its power and influence. Instead, the war has not gone as planned.

Western wonder weapons have not significantly changed Ukraine’s fortunes, and equipment like M2 Bradleys and Leopard tanks has been destroyed faster than it can be replaced. Deficiencies in western military production, along with the desire to maintain small, professional militaries have revealed weaknesses among the United States and its NATO allies that would impair our efforts in any land war with a peer competitor. Finally, massive defects of imagination were apparent in the American-planned Ukrainian “counteroffensive,” a debacle that barely dented the Russian lines.

While the early stages of the Russian campaign exposed deficiencies in Russia’s own planning and logistics, those problems have mostly been rectified. This is evident from Russia’s sustained and significant production of weapons and ammunition, the expansion of the Russian military itself, as well as recent advances along the entire front from Zaporozhye to Artemovsk.

Finally, the American contribution to the war in Gaza may also provide a lesson to hostile observers. While America is not a direct participant, we have deployed substantial naval assets to the region in order to prevent the expansion of the war by nation-state supporters of Hamas, such as Iran and Yemen. But in this endeavor, asymmetries arising from drone and missile weapons have shown that America’s large weapon systems, like aircraft carriers, while powerful, are also very vulnerable.

There’s a reason that our aircraft carriers are on the leeward side of Cyprus. If they get closer, they may be vulnerable to known and unknown missile threats from Syria, Yemen, Russian and Chinese vessels, and even Gaza itself.

Accelerating Decline Through Hubris

In its attempts to maintain unipolarity, the Biden administration has instead accelerated the rise of multipolarity. Not merely multipolar, we have driven the other poles together. A hostile coalition of Russia, China, and Iran has formed because they are all similarly aggrieved by the lopsided “rules-based international order,” or whatever euphemism is being employed for American dominance these days. Driving China and Russia together could have been avoided through a less ideological and more restrained policy on Ukraine. Now we’re stuck.

Not only have these hostile nations refused to assist the United States in deflecting Yemeni attempts to interdict cargo vessels, but formal allies like Spain have demurred, and others have only contributed a few staff officers. Operation Prosperity Guardian is a week old, and it is already failing. Yemeni missiles and drones are still being fired at Israel, and the United States appears to have no appetite and likely a limited capability to easily influence events on the ground in Yemen itself.

A proper national security strategy prioritizes objectives and then designs a military capability around those ends. The current American military force structure, size, and logistical pipeline do not easily support the maximalist goal of maintaining American hegemony as the “sole superpower.”

The investment in bespoke, high-tech weapon systems rests on questionable assumptions about the coming “revolution in military affairs” that have not been demonstrated in recent conflicts. Instead, there is now a significant mismatch between means and ends.

American strategy must navigate a multipolar world by setting priorities, abandoning vanity projects, reducing the scope of its ambitions, and tailoring the force structure to achieve objectives commensurate with our existing military power, industrial capability, and the probability of sustained public support.

The recent spate of ideologically driven wars to liberalize the Middle East and topple Russia is actually hurting our reputation and national power. Getting involved in similar wars of choice will further hasten our national decline.

For the first time ever, BYD has passed Tesla as the world’s most popular electric vehicle.

As we noted moments ago, Tesla announced this morning it had “produced approximately 495,000 vehicles and delivered over 484,000 vehicles” for Q4. The company noted that its full year vehicle delivery number was up 38% to 1.81 million, slightly less than recently revised expectations for the year. Nonetheless, total deliveries mark a record quarter for the EV manufacturer. The company manufactured approximately 1.85 million vehicles for the period. 

But on Monday BYD beat Tesla’s quarterly number with its battery only electric, reporting sales of 526,000 for Q4, according to Financial Times.

The company said it produced more than 3 million new energy vehicles for the year and it marks the second year that BYD has beat out Tesla in total production. BYD produced 1.6 million battery only vehicles, just slightly behind Tesla, and 1.4 million hybrids. 

We wrote back in September that BYD and Tesla were the two companies neck and neck leading the EV industry. We noted then that for the first half of 2023, BYD alone sold almost 1.2 million plug-in electric vehicles (incl. plug-in hybrids), roughly double the combined total of BMW, Volkswagen and Mercedes.

As Statista’s Felix Richter showed, based on estimates from CleanTechnica, BYD and Tesla had opened up a sizeable lead in the global EV market in the first half of 2023. Other Chinese brands such as GAC Aion, SGMW and Li Auto are also among the largest players thanks to their huge home market.

We also noted earlier this month that all of the “Tesla wannabe” EV names have, for the most part, run out of cash, setting BYD and Tesla far ahead of the pack. 

At least 18 EV and battery startups, including high-profile names like Nikola and Fisker, face the risk of depleting their cash reserves by the end of 2024, we wrote. These companies, once known for their ambitious goals to revolutionize the industry with electric trucks and SUVs, have struggled with increasing costs and manufacturing challenges.

Names like Lordstown Motors, Proterra, and Electric Last Mile Solutions have already declared bankruptcy, the report notes. Romeo Power, a battery manufacturer, and Volta, a charging company, were sold for much less than their initial public valuations. The remaining firms are reportedly focusing on cost reduction and have secured additional funding.

Gavin Baker, chief investment officer at Atreides Management, told WSJ last month: “It was by far the most insane bubble I have ever seen.”

Authored by Denes Albert via ReMix News,

The eastern German state of Saxony is presenting new problems for the country’s political establishment, with new polling showing the Alternative for Germany (AfD) reaching a new record high, while the Social Democrats (SPD) would be entirely kicked out of state parliament.

The new poll from the research institute Civey showed the AfD at 37 percent of the vote, rising four points since the last poll four weeks ago. Meanwhile, the SPD would obtain an abysmal 3 percent of the vote. Five years ago, the party still achieved 7.7 percent.

If the left-wing SPD were to achieve such a result, it would mark the first time since the Second World War that the SPD failed to achieve the 5 percent threshold in a federal state, which means it would be entirely removed from parliament. Such a result would place new pressure on Chancellor Olaf Scholz.

Neueste Civey-Umfrage für #Sachsen. Hat die CDU schon ihren sächsischen Wählern mitgeteilt, dass sie die nächste Regierung in einer Koalition mit “Die Linke” und den Grünen bilden will? 🤔 @cdusachsen pic.twitter.com/JSWbV7kEGc

— Peter Borbe (@PeterBorbe) January 2, 2024

The Christian Democrats (CDU) scored 32 percent, putting them in second place. The CDU, which currently governs the state with the SPD and Greens, would no longer be able to maintain its coalition. If the elections were held today, and the CDU party maintained its self-declared “firewall” against the AfD, it could then only govern with a coalition of the Left party and Greens.

Such a result would place extreme pressure on the CDU, as the party has also traditionally rejected any alliance with the Left Party.

Saxony will hold its elections in approximately eight months, on Sept. 1, 2024, and there are fears from the German political establishment that some eastern states will be ungovernable without including AfD in coalition governments.

In response to the popularity of the AfD, there are now ongoing attempts to ban the party outright, including efforts from CDU MP Marco Wanderwitz, who was defeated by an AfD candidate in his home district.

“We are dealing with a party that seriously endangers our free democratic basic order and the state as a whole,” which is why “it is high time to ban them,” said Wanderwitz during an appearance on ARD’s public television program last year.

…

Read more here…

In part of a continuing trend of major Western publications belatedly admitting that all is not well with Ukraine policy and the state the war, The Times of London reported Sunday that the UK has “nothing” left it its own military stockpiles after being among Ukraine’s biggest weapons suppliers for nearly two years of conflict.

British defense officials and European leaders are now busy “cranking through the gears” to ramp up weapons production, the report says, citing an unnamed staffer from Prime Minister Rishi Sunak’s office.

The report also relied on an unnamed Ukrainian source. The dwindled UK stockpile is being reported on at a time that “Britain’s military intelligence chiefs believe Ukraine cannot win the war against Russia in 2024 because it does not have the manpower or the weapons for a big battlefield breakthrough,” The Times wrote.

An internal UK government debate and divide has emerged over the future course of London’s policy, with some arguing that the Western allies simply need more “time” to ramp up arms production.

But one big uncertainty at a moment the West is generally feeling “war fatigue” – according to most public polling among various countries’ citizenry – is the question of who will be in the White House in 2025. European officials are nervous that a Trump victory would spell the end of efforts to fuel the proxy war against President Vladimir Putin.

At the same time, President Volodymyr Zelensky is clearly becoming more and more unpopular, even on an international stage. A former Ukrainian official told the Times that he’s losing support because of the immense death toll, but with no end-game or plans for negotiations in sight. The source described there’s growing anger and pushback at the spectacle of men and women being “sent to the front line to die.”

A British source additionally explained to the Times that if the US is forced to take a backseat due to its domestic politics (and with Republicans still holding up Biden’s billions more in defense aid for Kiev), then Europe will have to step up and keep aid flowing.

“Can continental Europe afford to fold just because Trump says no more US dollars? I think most realize that Putin can’t be allowed to win as consequences for European security are grave,” the source said.

⚡️UK announces new air defense aid package for Ukraine after Russia’s mass attack.

The U.K. will send Ukraine “hundreds of air defense missiles” to restock air defense systems provided by London earlier, U.K. Defense Minister Grant Shapps announced on Dec. 29 after Russia… pic.twitter.com/4kHaG7GKNt

— The Kyiv Independent (@KyivIndependent) December 29, 2023

Below is an example of the kind of wishful thinking that still exists in Europe, as quoted in the Times report:

Although he did not provide comment on a future US presidency, Grant Shapps, the defence secretary, said he was speaking to his counterparts in Europe constantly about the need to back Ukraine in its “darkest hour”.

In comments to The Times after two days of major aerial assaults by both sides, he said: “We need to pull together to help them in a war that will define Europe for decades — both with hardware and also the support and moral leadership.”

But many analysts would view this as a pipe dream given that Washington’s contribution far outweighs Europe’s aid to Ukraine by a massive margin. Likely Europe simply won’t be able to close so large a gap even if European countries have the collective will.