GM Shifting From EVs To Plug-In Hybrids, Following Industry Trends

GM Shifting From EVs To Plug-In Hybrids, Following Industry Trends

Don’t tell the Biden administration, but it’s almost as if the free market is capable of arriving at the most efficient solutions by itself…

The latest example of this is General Motors, who posted better than expected earnings earlier this week and also said that it plans on changing its product lineup to include more hybrid vehicles, drifting away from pure electric vehicles. 

CEO Mary Barra said on this week’s earnings call: “Let me be clear, GM remains committed to eliminating tailpipe emissions from our light-duty vehicles by 2035, but, in the interim, deploying plug-in technology in strategic segments will deliver some of the environment or environmental benefits of EVs as the nation continues to build this charging infrastructure.”

Barra announced plans to introduce plug-in hybrid electric vehicles (PHEVs) in North America on select models, aiming to comply with stricter federal fuel economy regulations. This shift mirrors industry trends, as automakers increasingly adopt hybrid technology to meet consumer demands and federal standards, following GM’s main rivals who already offer hybrids and PHEVs, according to CNBC

Barra hinted at GM’s potential use of plug-in hybrid technology, similar to what it has implemented in China, the CNBC report said. Currently, GM’s only hybrid in the U.S. is a traditional version of the Chevrolet Corvette. The company was a pioneer in plug-in electric vehicles with the Chevrolet Volt in the 2010s but discontinued it in 2019 due to demand and cost issues.

Originally, GM planned to transition from internal combustion engines to solely all-electric models. However, this change in strategy seems at odds with the industry’s recent focus on EVs and the significant investments being made in this area, aligned with the Biden administration’s efforts to increase EV usage in the U.S.

In other words, the automotive industry – which has now seen investment pulled from EV development by both major automakers that just struck massive extortion labor deals with the UAW – is screaming that pure electric vehicles don’t make financial sense. 

Tyler Durden
Thu, 02/01/2024 – 21:20

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What Is Nikki Haley Doing?

What Is Nikki Haley Doing?

Authored by Sean Trende via RealClear Wire,

Before we start evaluating what Nikki Haley’s plans are for the Republican primaries, let’s get one thing out of the way: Barring catastrophe, Donald Trump is going to be the Republican presidential nominee. We will go into the reasons why below, but it is an important enough fact that we should lay it out up front.

So given this, why is Nikki Haley continuing her bid? I see five possibilities:

She thinks she might pull ahead in the delegate count. Pure intentions are always a good place to start, so we should mention (and eliminate) this possibility upfront. Haley finished third in Iowa, while Donald Trump received a majority of the vote. She placed second in New Hampshire (and almost certainly still would have, even if Ron DeSantis had not dropped out), while Trump received a majority of the vote.

So in a state dominated by evangelicals, and in a state where white evangelicals were just 19% of the electorate, Trump won handily. Almost every state to follow will fall somewhere between these two. Next up is South Carolina which looks like a catastrophe for Haley (although it hasn’t been polled in a while). The remaining states look more like South Carolina than they do New Hampshire.

In short, former Gov. Haley likely just had one of her best shots at Trump. She missed. It’s not clear where she connects. Surely she knows this. Surely her team knows this. It would be malpractice if they didn’t.

She wants to give establishment Republicans a chance to be heard. Maybe she is staying in so that anti-Trump voters can vent their frustration with the quasi-incumbent president. That would be an unusually benevolent move on the part of a politician (see also 4 and 5 below). Yet, if you’re insisting upon a charitable explanation, this is probably where you end up.

She thinks she might win at the convention and/or a catastrophe might befall Trump. The former president is 77 years old. He turns 78 in June. He is infamous for enjoying fast food and eschewing exercise. Health concerns aside, there are the criminal indictments that are following him around (although it seems increasingly unlikely that any trials will occur prior to the Republican National Convention).

I wouldn’t put the odds of any of these occurring and mattering at higher than 10%. But on the off chance that something does happen between now and July, it wouldn’t hurt Haley to have some actual delegates in her pocket at the convention.

She wants to be vice president. This is the conventional explanation for why candidates stay in. Maybe Haley wants to prove her toughness to Trump, and that she could take on the traditional “attack dog” role that veeps are often slotted to fill.

But there are ways to do this and then there are ways not to do this. Questioning the likely presidential contender’s mental fitness, for example, falls squarely within the “ways not to do this” basket. This is especially true with Trump, who is hardly known for having thick skin. Moreover, Trump has said that Haley – and her donors – are permanently “barred from MAGA.” It’s far more likely that this campaign ends Haley’s career in Republican politics than it is that it catapults her into the presidency.

That leaves us with:

She wants to hurt Donald Trump. Imagine that you previously served in President Trump’s cabinet and were so horrified by what you saw that you concluded he should never sit in the Oval Office again. Or, imagine that you simply despise the guy and think he’s categorically unfit to be president. What would you do?

YMMV (your mileage may vary, for readers below a certain age), but you could certainly do a whole lot worse than what Haley is doing. By staying in and needling the former president, she delays him from claiming the mantle of GOP nominee and from transitioning to the general election. She knocks him off message, as he feels compelled to punch down, hard (as opposed to giving, say, his gracious Iowa speech). Her criticisms echo those coming from President Biden’s camp, so they probably soften Biden up some for the general election.

***

What’s in it for her? If she fits the bill of someone in the first paragraph, it speaks for itself. If not? A job from wealthy donors? A network television show? The speaking circuit? Plenty of opportunities are available for failed presidential candidates, especially those who attack a candidate the establishment genuinely despises.

Sean Trende is senior elections analyst for RealClearPolitics. He is a co-author of the 2014 Almanac of American Politics and author of The Lost Majority. He can be reached at strende@realclearpolitics.com. Follow him on Twitter @SeanTrende.

Tyler Durden
Thu, 02/01/2024 – 21:00

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‘IRGC Is Getting Out Of Dodge’: Biden Has Telegraphed Syria-Iraq Response Too Much

‘IRGC Is Getting Out Of Dodge’: Biden Has Telegraphed Syria-Iraq Response Too Much

US Secretary of Defense Lloyd Austin in a Thursday press briefing claimed that “Our soldiers were killed by Iranian agents,” in reference to the weekend drone attack on a Jordanian base which killed three American troops. It is now being widely reported that the Pentagon will launch multiple days of airstrikes on ‘Iranian targets’ and assets in Syria and Iraq.

Biden admin officials in the last two days have been leaking to the press information about the scope of operations. But Iran hawks aren’t happy, saying this level of telegraphing has given Iranian and IRGC officers ample time and opportunity to vacate their bases.

Even as of Monday there were widespread reports that Iran-linked groups were temporarily abandoning their bases in the region, fearing immediate major attacks.

One think tank Iran hawk, Jason Brodsky, complained on Thursday as US strikes are imminent, “The U.S. government is really helping IRGC terrorists get out of Dodge—the long lead time coupled with visibility into the U.S. response. It raises all kinds of questions and none of them are good.”

And Republican Congressman from Florida Mike Walz said the extent of foreknowledge and wait time makes the whole operation “deliberately unserious”

Another commentator pointed out that the Biden admin has been “vocal about targeting the IRGC in Iraq & Syria, yet reports say the IRGC has moved its top officers back to Iran… This move raises questions: Is the admin soft on the IRGC or looking to protect them?”

According to Reuters:

Iran’s Revolutionary Guards have scaled back deployment of their senior officers in Syria due to a spate of deadly Israeli strikes and will rely more on allied Shi’ite militia to preserve their sway there, five sources familiar with the matter said.

The Guards have suffered one of their most bruising spells in Syria since arriving a decade ago to aid President Bashar al-Assad in the Syrian war. Since December, Israeli strikes have killed more than half a dozen of their members, among them one of the Guards’ top intelligence generals.

Earlier in the day Defense Secretary Austin was asked whether the US has telegraphed its response too much to the point of essentially allowing leaders to return to Iran. He essentially dodged the question, saying, “We will have a multi-tiered response.”

We should point that to some degree the basic Western assumptions that there are “Iran-backed” groups running around all over Syria, and that they take orders directly from Tehran is an exaggeration and misleading. While certainly any group fighting on behalf of the pro-Damascus/Baghdad/Tehran axis is ‘Iran-linked’, there’s still multiple and varied interests driving them. For example, militias close to the Syrian government are seeking to push out the years-long US troop occupation of the country’s vital oil and gas resources. Syrian nationalism is something very different from Iran’s Islamic revolutionary ideology. 

Getty Images

The New York Times too has conceded that despite it being well-known that Tehran arms and funds the main Shia militias in Iraq, there remains no evidence that Tehran is “calling the shots” when it comes to events like attacks on US personnel out of Syria or Iraq.

As for the major counter-Iran strikes, it seems Biden wants to show he’s “doing something” ahead of the election, but an operation which poses less risk for rapid direct escalation with the Islamic Republic. He’s going for the “easy” lay up of attacking Syria again, which has already been done several times over the years.

Tyler Durden
Thu, 02/01/2024 – 20:40

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Trump Says He’s Interviewing Lawyers For E. Jean Carroll Appeal

Trump Says He’s Interviewing Lawyers For E. Jean Carroll Appeal

Authored by Jack Phillips via The Epoch Times (emphasis ours),

Former President Donald Trump said he is interviewing attorneys to appeal a jury’s ruling stipulating that he must pay writer E. Jean Carroll $83 million.

Former President Donald Trump sits in the courtroom with attorneys Christopher Kise (L) and Alina Habba during his civil fraud trial at New York State Supreme Court in New York on Nov. 6, 2023. (Brendan McDermid-Pool/Getty Images)

In a post on Truth Social, the former president wrote that he is in the process of “interviewing various law firms to represent me in an appeal” of the Carroll ruling, which he described as “one of the most ridiculous and unfair Witch Hunts our Country has ever seen.”

“Any lawyer who takes a TRUMP CASE is either ‘CRAZY,’ or a TRUE AMERICAN PATRIOT,” President Trump wrote on Jan. 30. “I will make my decision soon.”

He was represented during the trial by attorney Alina Habba, who represents him in the separate civil fraud trial in New York and other cases. After the verdict was issued in the Carroll case, Ms. Habba filed a letter to the court alleging that Judge Lewis Kaplan was biased.

She cited a New York Post report that he previously worked at the same firm as Carroll attorney Roberta Kaplan.

The underlying defamation case tried last year, and the damages trial completed last week, were both litigations in which there were many clashes between Your Honor and defense counsel,” Ms. Habba wrote.

“We believe, and will argue on appeal, that the Court was overtly hostile towards defense counsel and President Trump, and displayed preferential treatment towards Plaintiff’s counsel.”

In a court filing of her own on Jan. 30, Roberta Kaplan denied allegations that she was mentored by the judge, as Ms. Habba had alleged. She said they never interacted and suggested that she could sanction Ms. Habba.

In response, the Trump lawyer responded by saying she was asking a question about whether there was any truth to the report.

The length of our overlap at Paul, Weiss was less than two years,” Ms. Kaplan wrote in a response on Jan. 30, adding that “during that relatively brief period more than thirty years ago, I do remember the Paul, Weiss partners with whom I worked and none of them are Your Honor.

Ms. Habba responded in a letter, saying: “The purpose of the letter was simply to inquire as to whether there is any merit to a recently published New York Post story which reported on the alleged existence of such a relationship.”

This past week, a New York jury found that President Trump had damaged Ms. Carroll’s reputation in 2019 after she went public with her accusations. Jurors awarded her $18 million to compensate for the personal harm she experienced, then added $65 million more to punish President Trump.

A different jury concluded last May that President Trump assaulted Ms. Carroll in a Manhattan department store dressing room in 1996. Those jurors awarded Ms. Carroll $5 million.

The former president said he did not know Ms. Carroll and vehemently denied her allegations.

What’s Next

Days after the ruling, Ms. Carroll appeared in an MSNBC interview this past week with host Rachel Maddow and suggested they go shopping.

“I have such great ideas for all the good I’m going to do with this money,” Ms. Carroll said on the show, referring to the money.

“First thing, Rachel, you and I are going to go shopping. We’re going to get completely new wardrobes, new shoes, a motorcycle for [attorney Shawn] Crowley, a new fishing rod for [attorney Roberta Kaplan].”

Rachel, what do you want? A penthouse? It’s yours, Rachel,” she stated. “You want France? You want to go fishing in France?

Her lawyer then interjected and said her comments were “a joke.”

Lawyers for the former president have said they will appeal both verdicts. “It will not deter us. We will keep fighting. And I assure you, we didn’t win today, but we will win,” Ms. Habba said in a recent statement.

E. Jean Carroll arrives for her defamation trial against Former President Donald Trump at the federal courthouse in New York on January 16, 2024. (Stephanie Keith/Getty Images)

Among other things, his team wants higher courts to rule that President Trump was within his rights to deny Ms. Carroll’s allegations forcefully and suggest that she had ulterior motives.

“Everyone has a right to defend themselves,” his lawyer said.

President Trump’s lawyers also are contesting Judge Kaplan’s ruling that the jury in the second trial did not need to revisit whether the former president was liable for sexual assault, and that the judge unfairly limited what the Trump legal team could say in front of the jury.

Appeals will go to a panel of judges in New York. The appeals eventually could reach the U.S. Supreme Court for the justices to consider.

The Associated Press contributed to this report.

Tyler Durden
Thu, 02/01/2024 – 20:20

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

75% Of House Democrats Voted Against Deporting Criminal Migrants Who Commit Social Security Fraud

75% Of House Democrats Voted Against Deporting Criminal Migrants Who Commit Social Security Fraud

Democrats talk a big game about ‘Republican attacks on Social Security,’ but 75% of House Dems just voted against deporting migrants who commit Social Security fraud.

Introduced by Rep. Tom McClintock (R-CA) in December, H.R. 6678 passed with 172 “yea” votes, and 155 “nay” votes – all Democrats, with 55 of them voting with the Republicans.

As former Trump adviser and head of the America First Legal Foundation Stephen Miller posted on X, “155 HOUSE DEMOCRATS — 75% OF THEIR CONFERENCE — JUST VOTED AGAINST DEPORTING CRIMINAL MIGRANTS WHO COMMIT SOCIAL SECURITY FRAUD AND ROB OUR SENIORS.”

“They’d rather protect illegal aliens than our seniors,” said the House Judiciary Committee in a Thursday post on X.

Meanwhile, 150 Democrats also voted against legislation that would quickly deport illegal aliens who drive drunk.

“I am appalled to see a majority of Democrats in the House of Representatives voting to prevent illegal aliens who endanger the lives of American citizens by drunk driving from being deported. Americans deserve leaders who put their safety and prosperity first,” said Rep. August Pfluger (R-TX).

According to OA Online, “H.R. 6976, the Protect Our Communities from DUIs Act, introduced by Rep. Barry Moore (R-AL), closes a gaping loophole in U.S. immigration law related to drunk driving. Because there is neither a ground of inadmissibility nor a ground of removability explicitly related to driving under the influence (DUI) of alcohol or drugs, criminal aliens currently can escape accountability for their reckless actions and be free to re-offend and endanger communities. By creating a ground of inadmissibility and a ground of removability for aliens who have committed DUI offenses, this legislation provides long-awaited and much-needed reforms to safeguard American communities.

According to Rep. Rashida Tlaib (D-MI), the bill would create a “separate but unequal” system of justice for immigrants.

Tyler Durden
Thu, 02/01/2024 – 20:00

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Today’s Censorship Is Personal

Today’s Censorship Is Personal

Authored by Jeffrey Tucker via The Brownstone Institute,

The United States has the distinction the world over for being a home to the First Amendment, which guarantees free expression. And yet a mere seven years after its ratification in 1791, Congress violated it in the most severe way with the “Alien and Sedition Acts” of 1798, which made it a crime to engage in “false, scandalous, and malicious writing” against government officials. 

The Sedition Act mentioned Congress, the President (John Adams), government generally as protected, but was silent about the Vice President, who was Thomas Jefferson. Upon the election of Jefferson in 1800, it was repealed immediately. Indeed, the censorship was so controversial that Jefferson’s opposition contributed to his victory. 

The experience taught an important lesson. Governments have a tendency to want to control speech, meaning writing in those days, even if it means trampling on the rules that bind them. This is because they have an insatiable desire to manage the public mind, which is the story people carry around that can make the difference between stable rule and popular discontent. It has always been thus. 

We like to think that free speech is settled doctrine but that’s not true. Thirty-five years after Jefferson’s victory, in 1835, the U.S. Post Office banned the circulation of abolitionist materials in the South.

This went on for 14 years until the ban was lifted in 1849. 

Then 12 years later, President Abraham Lincoln revived censorship after 1860, imposing criminal penalties on newspaper editors that supported the Confederacy and opposed the draft. Once again, people who disagreed with regime priorities were considered seditious. 

Woodrow Wilson did the same during the Great War, targeting anti-war newspapers and pamphleteers again. 

A new book by David Beito is the first to document FDR’s censorship in the 1930s, muzzling opponents of his administration. Then in World War Two, the Office of Censorship got busy monitoring all mail and communications. The practice continued on after the war in the early years of the Cold War with the blacklists against alleged communists. 

There is a long history of government using every means to channel speech, especially when technology finds a way around the national orthodoxy. Government has usually adapted to the new problem with the same old solution. 

When radio came along in the early 1920s, radio stations exploded around the country. The federal government quickly responded with the Congress-created Radio Act of 1927, which made the Federal Radio Commission. When television seemed inevitable, that agency converted itself to become the Federal Communications Commission, which long kept a tight rein on what Americans heard and saw in their homes. 

In each of the above cases, the focus of government pressure and coercion was the distribution portals of information. It was always the editors of newspapers. Then it became the broadcasters. 

Sure, the people had free speech but what does it matter if no one hears the message? The point of controlling the broadcast source was to impose top-down messaging for purposes of managing what people generally think. 

When I was a kid, “news” consisted of a 20-minute broadcast on one of three channels that said the same thing. We believed that’s all there was. With such strict controls on information, one can never know what one is missing. 

In 1995, the web browser was invented and an entire world grew up around it that included news from many sources, and then eventually social media too. The ambition was summarized in the name “YouTube:” this was a television from which anyone could broadcast. Facebook, Twitter, and others came along to give every single person the power of an editor or broadcaster. 

Keeping with the long tradition of control, what was government to do? There had to be a way but getting hold of this giant machinery called the Internet was not going to be an easy task. 

There were several steps.

  • The first was to impose high-cost regulations on admission so that only the most well-heeled companies could make it big and consolidate.

  • The second was to rope these companies into the federal apparatus with various rewards and threats.

  • The third was for government to winnow its way into the companies and subtly push them to curate information flows based on government priorities. 

This takes us to 2020, when this vast apparatus was deployed fully to manage messaging on the response to the pandemic. It was highly effective. For all the world, it seemed as if everyone responsible was fully in support of policies that have never before been attempted, such as stay-at-home orders and church cancellations and travel restrictions. Businesses nationwide were shut, with hardly a peep of protest that we could hear at the time. 

It seemed spooky but, over time, investigators came to discover a vast censorship industrial complex that was in heavy operation, to the point that Elon Musk declared that the Twitter he bought might as well have been a megaphone for military intelligence. Thousands of pages have been amassed in court filings that confirm all of this.

The case against the government here is that it cannot do through third parties such as social media platforms what it is forbidden from doing directly by virtue of the First Amendment. The case in question is popularly known as Missouri v. Biden, and there is much at stake with its results. 

If the Supreme Court decides that the government violated free speech with these measures, it will help secure the new technology as a tool of freedom. If it goes the other direction, censorship will be codified in law and it will give license to agencies to lord it over what we see and hear forever. 

You can see the technological challenge here for government. It’s one thing to threaten editors of paper newspapers or throttle communications on radio and television. But it is another matter to gain full control over the vast web of global communication architecture in the 21st century. China has had some measure of success and so has Europe generally. But in America, we have special institutions and special laws. That should not be possible here. 

The challenge of censoring the Internet is vast but consider what they have achieved so far in the US. Everyone knows (we hope) that Facebook, Google, LinkedIn, Pinterest, Instagram, and YouTube are thoroughly compromised venues. Amazon’s servers have stepped up in service of federal priorities such as when the company shut down Parler on January 10, 2021. Even auspicious services like EventBrite serve their masters: Brownstone even had an event canceled by this company. At whose behest? 

Indeed, when you look at the lay of the land today, the reed on which free speech still stands is pretty thin. What if Peter Thiel had not invested in Rumble? What if Elon Musk had not bought Twitter? What if we didn’t have ProtonMail and other foreign providers? What if there were no truly private server companies? For that matter, what if we had only to rely on PayPal and conventional banks for sending money? Our freedoms that we know now would gradually come to an end.

These days, and thanks to technological advancements, speech has become deeply personal. As communication has become democratized, so have the censorship efforts. If everyone has a microphone, everyone has to be controlled. The efforts to do so affect the  tools and services everyone uses every day.. 

The outcome of Missouri v. Biden – the Biden administration has fought the case at every step – could make the difference as to whether the US will recapture its former distinction as the land of the free and home of the brave. It’s hard to imagine that the Supreme Court will decide any other way than to smack down the federal censors, but we cannot know for sure these days. 

Anything could happen. There is much at stake. The Supreme Court will hear arguments on the pre-trial injunction against agency intervention in social media on March 13, 2024. This year will be the year of decision about our fundamental rights.

Tyler Durden
Thu, 02/01/2024 – 19:40

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Double Standard: Pro-Life Activists Could Get 11 Years In Prison For Protesting Abortion Clinic

Double Standard: Pro-Life Activists Could Get 11 Years In Prison For Protesting Abortion Clinic

One of the surest signs that a society is falling into authoritarianism is the development of double standards in law enforcement and criminal prosecution in the name of political division.  When laws are created or used to target one political group above another, and those people are consistently punished by officials more harshly than other groups who commit similar offenses, then your nation is on a fast-track to Orwell’s Animal Farm.

In other words, “All animals are equal, but some are more equal than others…”

We have seen numerous instances of these double standards in US courts in the past few years.  For example, the entirety of the January 6th response was an attempt to falsely portray an unarmed protest (which capitol police attacked with rubber bullets and tear gas grenades until people reacted violently) as an “insurrection.”

More recently we have seen Michael Cassidy, the man who knocked down a satanic statue in the Iowa capitol building, charged with a “hate crime” even though satanists are not a victim status group and they often deny they are a religion.  Keep in mind that leftist activists have spent the better part of the past several years destroying statues of historic figures as well as destroying biblical symbols.  To this day very few leftists have been charged with a crime for these actions, let alone a hate crime. 

This week, six pro-life activists were prosecuted and convicted under a little known federal law called the “FACE Act” for blocking entrances to an abortion clinic in Tennessee in 2021.  Protesters performed a “sit-in” and sang hymns until they were removed by police.  Using the FACE Act, prosecutors turned the case into a federal matter carrying felony charges.  The activists could be sentenced to nearly 11 years in prison for protesting.  Here is what they are guilty of doing…

Truly terrifying.  Compare this to the multiple mob events and more violent measures used by leftist activists at government buildings and private businesses in just the past couple years.  This behavior has included attacking people entering and leaving establishments as well as vandalizing property.

Supreme Court Justices dealt with a host of threats from pro-abortion activists in 2022 and 2023.  This included protests outside their homes and even the attempted assassination of Brett Kavanaugh after rumors leaked that the SC was considering overturning Roe v. Wade.  Leftists groups and the media widely defended this behavior as justified.

And let’s not forget the unchecked aggression of Pro-Palestinians protesters using intimidation tactics outside of private businesses.  Where are the harsh sentences for these people?  A majority are released if they are arrested, most are never charged.

    

Punishment for this behavior is rarely applied despite the fact that it happens so frequently.  It is becoming obvious that a two-tier legal system is being constructed in the US right under the nose of the American public:  One for leftist activists and another for the conservatives and moderates that oppose them.  

This kind of disparity in prosecution and sentencing leads to a number of significant problems.  

First, it encourages more crime and violence on the part of the politically protected group (leftists) because they know they can get away with it.  Second, it inspires anger and animosity among the unprotected population, leading to retribution and civil unrest.  Third, it creates ambiguity in law enforcement to the point that government officials start to make standards up as they go.  Leftists might want to consider this final point, because it means that one day they could be hit with the same dubious treatment.

The fabric of western civilization relies on a number of tenets in order to remain intact.  Yes, people should be treated as innocent until proven guilty, but the punishment must also fit the crime, and punishment must be applied fairly to all groups.  When this principle is abandoned, the breakdown of the flailing society is not far behind.

People singing in front of a door does not deserve an 11 year prison sentence (or a 1 year prison sentence, for that matter).  And if the purpose for this kind of aggressive prosecution is to make an example of the protesters and send a message, why hasn’t a similar message been sent to leftist protesters?     

Tyler Durden
Thu, 02/01/2024 – 19:20

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A Soft Landing Is A Fairytale

A Soft Landing Is A Fairytale

Authored by Michael Wilkerson via The Epoch Times,

The last time the phrase “soft landing” was this popular on the internet was on the eve of the largest financial crisis the world has ever seen.

The idea behind an economic soft landing is that the central bank (for the United States, the Federal Reserve) is able to bring inflation from an overheated economy under control by increasing interest rates without producing a recession or a collapse of the financial markets. This is what markets desperately long for in early 2024 and are trying to manifest by simply repeating it as a mantra and believing in it hard enough.

The premise behind such a hope is the belief that the Federal Reserve will lower the Fed Funds target interest rate from its current upper limit of 5.5 percent. The futures markets are signaling multiple reductions of a total of 75 to 100 basis points over the next several months, bringing the target interest rate to 4.5 percent by mid-year.

The market believes this because it believes that the fight against inflation has been won. This is also a fantasy. Inflation remains stubbornly high, and will persist so as long as the United States continues to deficit spend billions of dollars and tack on trillions of new debt each year to pay debt service costs and fund massive defense spending. In short, the Fed will not be able to reduce rates without restoking substantially higher inflation.

Finally, the U.S. economy isn’t performing nearly as well as the statistics coming out of the federal government would like us to believe. Indeed, the disappointing Jan. 31 Chicago Purchasing Managers Index results indicate that the economy is contracting.

The market is in a speculative bubble. The S&P 500, after rising nearly 21 percent in 2023, has broken through to an all-time high, surpassing the previously attained highs of two years ago (January 2022), and is now trading at 26 times estimated 2023 earnings. The market-weighted S&P 500’s success is based on the performance of its seven largest constituents, while effectively ignoring the disappointing performance and struggles of the vast majority.

This “Magnificent Seven,” which includes tech platform names like Microsoft, Google’s parent Alphabet, Facebook’s parent META, Amazon, and Apple, outperformed earnings expectations by 4 percent in the fourth quarter, while the other 493 stocks are now estimated to underperform previous estimates by 15 percent. Despite this broad-based decline in performance, the index has continued to rise through January on the back of this narrow but highly visible group of companies.

At the same time, the VIX, the so-called “fear gauge” of equity investor sentiment, is near an all-time low, suggesting widespread complacency.

When bubbles inflate this rapidly and spectacularly, the end comes as quickly and as dramatically. Imagine the shape of a parabola whose downward slope is as steep as the ascent. Given the heights to which the markets have climbed since 2020, the bursting of the bubble may be as consequential as the global financial crisis of 2008-09. Or worse. Either way, there will be blood.

An equity market collapse will bleed over into other asset categories as liquidity dries up. This will then lead to a wider credit crisis as investors struggle to cover losses. As I wrote at the end of the year, the banks, especially the regional and community banks, are not OK. In December, these banks were borrowing more than $131 billion from the Bank Term Funding Program, the Fed’s emergency funding line established after the collapse of Silicon Valley Bank in March 2023. The program is set to expire in March 2024. What will the banks do then? Market liquidity isn’t robust enough to absorb this at a cost the banks can afford.

There are other signs that the banks will wobble again this year. On Jan. 31, shares of NYCB, the New York bank that acquired the deposits of the failed Signature Bank, fell 40 percent after the bank announced a surprise fourth-quarter loss of $252 million and that it would cut its dividend by 70 percent.

In the years leading up to the global financial crisis, the phrase “Goldilocks economy” was often used to describe the apparent health of the U.S. economy, conveying the idea that it was neither too hot nor too cold. Market investors and regulators blithely ignored—until it was too late—the massive speculative bubble that was growing in residential housing markets as a result of gross monetary policy mismanagement by the Federal Reserve.

As evidence of a looming catastrophe mounted to the point it could no longer be ignored, the term Goldilocks economy was replaced in internet searches by “soft landing.” Indeed, searches for soft landing hit an all-time high in the weeks following the collapse of Bear Stearns, while searches for Goldilocks economy fell to approximately zero. Today, with the collective hive mind of the internet invoking a soft landing, we’re again trying to will into existence something that cannot and will not happen.

A soft landing is a fairy tale told by liars and believed by fools.

Tyler Durden
Thu, 02/01/2024 – 19:00

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Ukraine Celebrates EU Approval Of $54BN Aid Package After Hungary’s Orban Caved

Ukraine Celebrates EU Approval Of $54BN Aid Package After Hungary’s Orban Caved

“We have a deal,” European Council President Charles Michel announced on X Thursday, declaring that all 27 European Union countries have finally agreed to the additional 50-billion-euro ($54bn) aid package for Ukraine, which was under threat of Hungarian veto.

The unanimous approval “locks in steadfast, long-term, predictable funding for Ukraine” and further demonstrates the “EU is taking leadership and responsibility in support for Ukraine; we know what is at stake,” Michel said.

Ukrainian President Zelensky too hailed the ‘victory’ – stressing that “It is very important that the decision was made by all 27 leaders, which once again proves strong EU unity.”

Via Reuters

Zelensky added, “Continued EU financial support for Ukraine will strengthen long-term economic and financial stability, which is no less important than military assistance and sanctions pressure on Russia.”

The approval for the funding was reportedly achieved merely within an hour into the special summit of EU leaders which gathered in Brussels on Thursday.

Estonia’s leader Prime Minister Kaja Kallas also hailed the “important signal to Ukraine that the EU stands behind you long-term, until victory.”

There’s also been a lot of backslapping and self-congratulations in Brussels over EU diplomats getting lone holdout Viktor Orban to fold

The European leaders managed to win over Orbán with three additions, diplomats said. There will be an annual report by the European Commission on the implementation of the aid package, there will be a debate at leaders’ level on the implementation of the package and, if it is needed, in two years the European Council will ask the Commission propose a review of the new budget, according to the latest version of the draft European Council conclusions.

EU leaders added a line referring to earlier conclusions from December 2020 to guarantee that the way the rule of law in Hungary is evaluated by the European Commission is done in a fair and objective manner.

This is music to Orbán’s ears, as the 2020 text has implications for the €6.3 billion of EU cohesion funds that were frozen for Hungary over rule-of-law shortcomings.

Ron Paul Institute director Daniel McAdams, who worked as a journalist in Budapest throughout the 1990s said that the Orban government “caved” plane and simple…

But McAdams clarified that “I still have great admiration for Orban but this should have been handled differently. I know the exact kinds of internal discussions on this. But you can’t be both a bold maverick and a ‘team player.’ That scumbag Tusk likely tipped the balance.”

He added: “Hungary has no real allies in the EU at present, save for perhaps Fico. But even that for historic reasons is not the smoothest of sailing, particularly when suddenly karpatalja is being whispered about. So Orban probably figured this is not the time to go for broke.”

And a Rabobank note pointed out the following broader ironies

In Europe, we have disinflation; and deindustrialisation; and Macron, Scholz, and Rutte saying Europe must rearm to help Ukraine beat Russia’s war economy – this from a Chancellor who didn’t arm Ukrainians, and a PM who didn’t arm the Dutch.

At the start of the week, amid Hungary’s perceived intransigeance on the Ukraine funding issued, some EU diplomats have begun to complain Europe is “starting to look weak”. But Orban beginning on Tuesday began giving off signals that he was ready to soften his stance.

Tyler Durden
Thu, 02/01/2024 – 18:40

via ZeroHedge News https://ift.tt/7q9tHVC Tyler Durden

California Legislature Introduces Slavery Reparations Bills

California Legislature Introduces Slavery Reparations Bills

Authored by Eric Lundrum via American Greatness,

On Wednesday, lawmakers in the state of California introduced a series of bills aimed at providing reparations for historical slavery, which would include giving out property and financial compensation for alleged descendants of slaves.

As Politico reports, the bills represent the first of their kind in the country, after a rising left-wing movement in favor of reparations first emerged shortly after the 2020 race riots. The California bills had been in the works for the last several years after Governor Gavin Newsom (D-Calif.) set up a reparations “task force” to make suggestions, which led to a 111-page report issued last year.

The 14 different bills introduced by the state’s Legislative Black Caucus focus on a wide variety of areas that are allegedly impacted by the legacy of slavery, including education, civil rights, and criminal justice.

While none of the bills include a measure to provide direct payments to those who would qualify based on slave ancestry, there is a provision to provide financial relief to certain groups based on allegedly race-based “property takings.” Authored by State Senator Steven Bradford (D-Calif.), the bill would “restore property taken during raced-based uses of eminent domain to its original owners or provide another effective remedy where appropriate, such as restitution or compensation.”

Speaking on the lack of direct payouts, which many on the far-left have considered the ultimate end goal of reparations, Assemblywoman Lori Wilson (D-Calif.), chairwoman of the Black Caucus, gave a statement saying that “while many only associate direct cash payments with reparations, the true meaning of the word, to repair, involves much more.”

“We need a comprehensive approach to dismantling the legacy of slavery and systemic racism,” Wilson added.

While the bills are all expected to easily pass due to the Democratic supermajority in both chambers, the laws will most likely face legal challenges after Newsom signs them into law.

As a result, some lawmakers are demanding that the California State Constitution be changed to allow for such provisions to be legal. Assemblyman Corey Jackson (D-Calif.), proposed a ballot referendum that would see the state’s voters approve such changes, so that the state could implement these programs with the intention of “increasing the life expectancy of, improving educational outcomes for, or lifting out of poverty specific groups based on race, color, ethnicity, national origin, or marginalized genders, sexes, or sexual orientations.”

Such race-based initiatives are facing more widespread backlash from the American public in recent years, particularly with regards to corporate diversity enforcements in the form of Diversity, Equity, and Inclusion (DEI). Last year, the Supreme Court issued a historic ruling overturning affirmative action – the practice of race-based preferences in the admission of college students, which overwhelmingly favors minorities over White applicants – ruling that such a practice was unconstitutional.

Tyler Durden
Thu, 02/01/2024 – 18:20

via ZeroHedge News https://ift.tt/6xXy2Mn Tyler Durden