Month: March 2024

Exxon Mobil Corp. is revising its compensation structure for traders, incorporating salary reductions in line with industry standards, complemented by potential cash bonuses and long-term incentives, according to a Thursday write-up by Bloomberg. 

It marks yet another savvy move for the ‘more cash than god’ oil firm that continues to find additional efficiency for shareholders.

This adjustment, which has been communicated to traders both in the US and Europe, aims to enhance competitiveness by aligning closer with practices at peer companies, which favor substantial bonuses linked to performance over higher base salaries.

Overall, the move marks part of a broader strategy to revamp Exxon’s trading operations, with the company seeking to emulate the success of competitors and specialized trading firms through a focus on asset-backed trading to mitigate risk.

The company has signaled that trading profits will now influence bonus eligibility, marking a shift towards rewarding performance that contributes directly to Exxon’s financial outcomes.

“The company plans to offer competitive salaries informed by benchmarking,” Exxon told Bloomberg. The company added that bonuses and incentives would be based on “company results, global trading results and individual performance.”

This isn’t the only place Exxon could be looking to eek out additional cash. Recall earlier this week we posted that the oil supermajor could be looking for a ‘pound of flesh’ from the forthcoming proposed takeover of Hess by Chevron. 

Exxon is challenging Chevron’s acquisition of Hess by challenging the terms of a stake in a major Guyana oil field. Exxon said it could exercise pre-emptive rights that could block Chevron from acquiring a 30% stake in the field, which sits at the center of the potential Hess acquisition. 

MKP Advisors said in a note reviewed by Reuters that Exxon is “very possibly looking to extract a pound of flesh from Chevron to support the deal proceeding.” They speculated that “It is very possible they want greater commitments from Chevron than Hess has previously signed up to.”

Exxon could be targeting Chevron to make concessions elsewhere, or to raise commitments already in place for the Guyana project. And it may be easier for Chevron to make concessions than to fight proceedings in court. 

Stewart Glickman, energy equity analyst at CFRA Research, told Reuters: “It’s impossible to say if Chevron’s lawyers or Exxon’s lawyers are correct.”

We noted earlier this week that ExxonMobil and China National Offshore Oil Corporation are “asserting their right to pre-empt its purchase of a stake in a Guyana oil project that is central to the deal.”

Authored by Matthew Piepenburg via VonGreyerz.gold,

It’s almost comical to watch policy makers of all stripes and country codes caught in a corner yet pretending we don’t notice.

Children In Charge

I’m reminded of the kid with his hand in the cookie jar while pretending his parents can’t see him—denying his guilt despite the crumbs falling from his face.

Again: It’s almost comical.

But there’s really nothing funny at all about major economies crawling into recession (Germany, Japan, UK, China) or denying recession (USA) while our mental midgets from DC to the EU play with bonds, inflation currency and war like kindergarteners with gas and matches.

Can’t Hide the Debt Cookie Crumbs

Speaking of kids caught with crumbs on their face while denying responsibility, it seems that even our central bankers can’t keep hiding the facts of now “unsustainable debt” (Powell) with clever lies, such as they had tried to do in the past:

In short, the days of hiding bad math behind empty words are now coming to an end, as most recently evidenced by another comical treasury market auction (below).

Keep It Simple: Debt & Bonds

As we’ve repeated ad nauseum, “the bond market is the thing,” and its survival, like a diesel V8 engine, lives and dies on liquidity/grease—i.e. dollars.

After trillions in outright grotesque QE grease following the bond crisis of 2020 and a hidden TBTF bank bailout (disguised as pandemic relief), the combined efforts of the Fed and Treasury Dept (i.e., the yin and yang of Powell and Yellen) to provide backdoor liquidity to this thirsty market are both tragic and remarkable.

Despite Powell’s headline tightening since 2022, the level of direct Fed liquidity is still tens of billions per month, and the hundreds of billions provisionally drawn from the reverse repo markets, the Treasury General Account (TGA), the Bank Term Funding Program (BTFP) are just QE by another pathway.

In addition to these tricks, tack on Yellen’s desperate attempt to issue trillions from the short end of the yield curve to take supply (and price) pressure off the sacred U.S. 10-Year, we can trace more examples of open desperation and backdoor liquidity by another name.

But at some point, all these liquidity tricks (as well as liquidity) run dry.

And when this “grease” runs out, that is when the bond engine stalls and the global financial system, led by a broke(n) U.S.A, starts its slow stall to the side of the proverbial road as the engine hisses, coughs and then dies.

Stated otherwise, the kids in DC are running out of cookies and jars (i.e., liquidity), and their lies and excuses are getting harder to hide.

Don’t believe it? Just look at the unloved US bond market.

A Very Telling & Embarrassing Treasury Auction

Having issued too many IOU’s (T-Bills) from the short end of the yield curve, Yellen’s Treasury Dept recently tried to auction off some IOUs from the longer end, namely the US 20Y UST.

Folks: It was embarrassing.

Foreign bidders for Uncle Sam’s 20-Year bond dropped to under 60% (they were 74% of the bidders in November).

This means that primary dealers (i.e., big banks) were forced to fill the gap by purchasing almost 22% of Uncle Sam’s increasingly unloved bar-tab of 20Y IOUs…

In simple speak, this is an open sign that the bond market is cracking. In fact, however, it has been cracking for a while…

Memories are short, as many have already forgotten the extreme dysfunction on the short end of the curve in Q1 of 2023 (not to mention the bank failures that followed, and with more to come, as warned…).

A similar disfunction is now openly obvious on the long-end of the bond curve, at least for those paying attention.

When bonds are unloved, their prices begin to fall, and their yields, which move inversely to price, start to rise, which means their interest rates rise too—adding more pressure (and cost) on Uncle Sam’s ability to repay the same.

Fiscal Dominance—More Than Just a Term of Art

This moment of interest expense “uh-oh” for DC is what the St. Louis Fed described in June of last year as “Fiscal Dominance,” namely that point where rising rates (and debt costs) get so high (i.e., dysfunctional), that the only option (and source) for more “greasy liquidity” (i.e., USDs) to support those ugly bonds is with money “clicked” out of thin air.

In short: More QE to the moon is inevitable, not debatable.

This QE inevitability is inherently inflationary, and this by the way, is the end-game for the Dis-United States, even if we experience a dis-inflationary recession somewhere in the middle of this tragic playing field.

Dollar Debasement—Right Before Our Eyes

Needless to say, such fake liquidity in the from an increasingly weaponized (and hence unloved) USD, places even more negative pressure on a DXY, which at the time of the aforementioned (and embarrassing) auction, was at 104, down from its 110+ levels of Q3 2022…

In the last four years of increasing bond dysfunction in the wake of drying liquidity, DC has shown five times in a row that it will come quickly and aggressively to the rescue to provide more fake grease (again, from the TGA, the BTFP, the repo markets etc.) to “save” the bond market at the expense of the currency.

Soon, we’ll just see plain ol’ QE, which will debase the USD even more, regardless of its “relative strength” to other equally, if not more, debased global currencies.

Such currency debasement, again, fits the pattern of all nations slowly dying from their own debt sins.

For now, of course, the markets are expecting Powell’s promised rate cuts to become actual rate cuts.

As a result, these markets are just giddy in anticipation and have recently hit all-time-highs on Powell words rather than Fed actions.

These already dangerously bloated markets will rise even further whenever the Fed has no choice but to hit the QE red button at the Eccles Building.

Tread Carefully You Top-Chasers

For those few, very few, who know how to trade nose-bleed tops without getting burned when net-incomes/margins trend south, the speculation and momentum trade juices are flowing.

But as I recently warned with evidence rather than hyperbole, today’s S&P, which is little more than a glorified tech ETF lead by 5 names, is the most dangerous bubble I’ve ever seen, traded or studied.

That Clever Pet Rock

Gold, meanwhile, will clearly get, and is already getting, the last laugh as stock bubbles inflate and bond markets scream for more debased USD grease.

The recent 20Y bond auction, above, with its foretelling of rising yields, should have been a massive headwind for that “yield-less pet rock.”

But as I argued from Vancouver in January, gold is breaking away from the standard correlations to rate, currency and inflation/deflation indicators.

Why?

For the simple reason that the overall system is now so openly broken, cracked, and dis-trusted that gold’s historically trusted (as well as speculator-ignored) role as a provider of real value (and 52-week highs) in world of diluted yet inflated currencies and bubble assets is becoming more obvious.

Again, this easily explains why central banks are stacking (and TRUSTING) this pet rock and dumping Uncle Sam’s IOUs at record levels.

That is, the world’s central banks (and leaders) see a US Humpty Dumpty about to fall off a wall, and when it does, gold will do far more to protect investors and sovereigns than bad IOUs and bubble assets measured in paper “money.”

Not surprisingly, the 0.5% of global financial assets allocated to gold are and will be rewarded not because they are just “contrarian for contrarian’s sake,” but because this remarkably small/informed minority are wise enough to think ahead rather just follow the sell-side sirens (and the crowd).

Which Needle Will Pop the Red Debt Ballon?

For now, and in the surreal backdrop of spiking markets and a Main Street on its knees and waiting for the “wealth effect” of a feudalistic rather that capitalistic financial system, all we can do is stare at the greatest debt bubble in history and guestimate which needle will “pop” it…

Will it be spiking rates colliding with the white swan of unprecedented global debt? A derivative market implosion? A geopolitical black swan? Another war? A collapsing Japan? China? America? A fractured/fragile EU? An immigration-lead fracturing of social order?

Who knows.

With so many needles pointed at a now historically unfathomable (and mathematically unpayable) red debt balloon, the actual needle that pricks us is rarely the one we see coming…

A Bank Needle?

As in 2008, the next crisis may come from where most crises are born, namely behind the glass doors of our stupid (and system-protected) banks…

The commercial real estate (CRE) crisis, of which I warned as far back as 2020, is anything but a minor matter.

The CRE losses on non-performing loans (NPLs) now exceeds the loss reserves at many of the largest US banks (Citi, Goldman, Wells, Morgan Stanley, JP Morgan etc.)

The Fed’s Real Mandate

Ironically, however, I don’t worry about these silly banks, because their Rich Uncle Fed’s real mandate is not inflation and employment, but making sure the foregoing banks, from which the Fed was un-naturally spawned, do not fail.

Bank regulators, who are just former bank executives, will meet FOMC and Treasury “experts” in DC and paste-together more back-room extend and pretend programs (which is how all failed banks deal with their failing loans and leadership) to provide the bigger boys with needed “grease” (i.e., liquidity) to stay alive (via forced yet subsidized UST, MBS and syndicated CRE/ABS purchases) as the Fed, once again, decides between saving the banking system or the currency.

Needless to stay, the suspense is hardly killing any of us who know how DC and Wall Street work.

In other words, expect more mouse-clicked trillions to save Uncle Fed’s spoiled banking nephews in a NYC which has slowly become not only a den of thieves, but a half-way house for millions of illegals which we like to call “asylum seekers” …

Ah, the American Dream, ah, the city that never sleeps…and the nightmare that never ends for every inflation-braced Main Street from Sea to Shining Sea.

Big Trouble in Little China

Of course, the US is not alone with yet another real estate cancer. China’s CRE crisis is arguably and mathematically worse.

But is that any real consolation to those facing an increasingly debased Greenback and unloved UST?

Are we supposed to be happy that our currency and bonds, though awful, are still better (for now, at least) than China’s?

Well, if our Dollar and IOU are so relatively special, why are the yields on our 10Y UST spiking 200 basis points above the CGB (Chinese Government Bond) yields?

Well, unlike the US, China is not pretending to be above total control over its markets and people, a trend which will come to the West once its childish leaders are forced into a debt corner.

History’s Sad Pattern

As I’ve warned for years, the syllogism from debt-crisis to market-crisis to currency and inflation crisis, followed by social unrest and then increased centralization from the extreme left or right is a pattern as old as history itself.

China has no shame about overt capital controls or state-owned banking.

But are our Fed-supported TBTF banks any less “centralized” just because their CEO’s get paid like capitalists despite being bailed out like state-sponsored entities?

We have had Wall Street socialism for years, but have put a nice “free market” lipstick on what is in essence just an “insider” pig.

Based on the trends above, and the pattern just described, the slow-drip toward more currency debasement, inflation and centralized (and capital) controls (think CBDC) in the wake of social unrest (from truckers and tractors fighting their “lords” from NYC to Berlin) is not only here and now, but the tragic road ahead.

This pattern of centralization, sadly, is just history and math. The cycles will play out. And gold, though no cure-all for all the overt and covert sins of our failed leadership, will at least be a cure for our failed currency.

Saturday morning’s headlines are dominated by the news that “Rubymar,” a bulk carrier, that was hit by missiles from Yemen’s Houthi rebels last month, has finally sunk. This marks the first vessel to be fully destroyed in the multi-month Red Sea crisis. 

However, there’s more Red Sea crisis news hitting the wires.

The British military’s United Kingdom Maritime Trade Operations Center, which monitors Middle East waterways, posted on X around 0700 ET that it had received a report of a commercial vessel attack about 15 nautical miles west of Al-Mukha, also known as Mokha, a port city in southwestern Yemen on the Red Sea coast. 

“The crew took the vessel to anchor and were evacuated by military authorities. The vessel has dragged anchor and now in position 13-21.19N 042-57.64E, and is down by the stern, bows remain above waterline,” UKMTO said. 

Details about the attack and the vessel remain limited at this time. This story is developing.

By Michael Msika, Bloomberg Markets Live reporter and strategist

The US has the Magnificent 7 tech giants charming investors and driving up valuations. Europe — depending on which strategist you ask — has the Seven Wonders, the Super 7 or the GRANOLAS.

The Mag 7 imitators highlight Europe’s unfulfilled ambitions for its own supergroup of stocks. The continent’s companies are hobbled by relatively lower earnings, sluggish economic growth and this cycle’s heavy preference for US big tech — all curbing the Stoxx Europe 600’s returns to about half of those on the S&P 500 in 2024. Nevertheless, Europe has some strong arguments.

“These monikers are a great way to remind investors that there’s attractive stocks in Europe too, and at cheaper valuations than in the US,” says Citigroup strategist Beata Manthey. As a consequence of the zero-rates era when US growth stocks were “the natural place to flock to,” Europe now has solid, yet “underestimated” companies, she says.

The strategist adds that in contrast to the US, it’s unusual for Europe to showcase a narrowing market — where growth is concentrated in a select number of stocks. This could be good news, however, as historically stocks tend to rise in the 12 months following narrowing episodes, albeit with higher volatility.

The US has the Magnificent 7 tech giants charming investors and driving up valuations. Europe — depending on which strategist you ask — has the Seven Wonders, the Super 7 or the GRANOLAS. The Mag 7 imitators highlight Europe’s unfulfilled ambitions for its own supergroup of stocks. Beata Manthey, Citigroup Global Markets Global Equity strategist discusses with Francine Laqua on Bloomberg Pulse.

As the market rally could stay narrow, Manthey has identified European megacaps who could be the continent’s own Magnificent 7. Her “Super 7” includes Novo Nordisk, ASML, LVMH, SAP, Schneider, Richemont, and Ferrari. These stocks are cheaper than the Mag 7, offer similarly attractive margins and have underperformed the Mag 7 by 70% since the start of 2023, “leaving room for catch-up,” she says.

As shown in the chart above, seven stocks have accounted for nearly 70% of the Stoxx 600’s 3.3% rally this year. Across the pond, the Magnificent 7 account for 23% of the S&P 500’s market cap and 50% of returns year to date. The US group is up 14% YTD, more than twice the return of the benchmark.

In Europe, the list of would-be super-stocks varies from one strategist to another, with some core large caps always present. Societe Generale strategists, led by Roland Kaloyan, have coined the “Seven Wonders of Europe,” including Novo Nordisk, ASML, LVMH, SAP, Siemens, Schneider and Hermes. It touts the “earnings champions” as global players with limited domestic exposure, which are more diversified than the Mag 7.

SocGen strategists say the rising weight of megacaps is becoming an issue at the country level, as big stocks approach funds’ limits. “Few investors are comfortable with dedicating more than 10% of their funds to a single stock, if they are even allowed to, a threshold recently reached by ASML in the Euro Stoxx 50,” they say.

Europe’s 10 largest caps now account for over 20% of the Stoxx 600, getting close to the peak of 22% reached during the tech bubble in 2000. While large caps have carried the benchmark’s performance, European equities continued to suffer outflows, shedding $8 billions this year, while US peers gained $13 billion in inflows, EPFR Global data show.

But let’s give to Caesar what belongs to Caesar: Goldman Sachs strategists created a megacap acronym for Europe back in 2020, during the first lockdown. GSK, Roche, ASML, Nestle, Novartis, Novo Nordisk, L’Oreal, LVMH, Astrazeneca, SAP and Sanofi have since been the “GRANOLAS.” The group has performed like the Mag 7 since the start of 2022, with half their volatility, and are 30% cheaper.

“The GRANOLAS exhibit qualities that we expect to predominate in this cycle: strong earnings growth, low volatility, high and stable margins, and strong balance sheets,” say strategists including Guillaume Jaisson, who remain overweight the group. “They also stand to benefit from the structural shift toward passive investment and the lack of liquidity in the European equity market.”

A US official confirmed to CBS News on Friday night that fishermen off the coast of Alaska have found what appears to be a “pretty big balloon.” Speaking with government sources, other corporate media outlets said the debris could be a Chinese spy balloon.

The crew of the commercial fishing vessel managed to lift the debris out of the water and is hauling it back to a port in Alaska sometime this weekend. 

🚨#BREAKING: A Commercial Fishermen has spotted suspected spy balloon off the coast of Alaska

📌#Alaska | #USA

A Commercial fishermen off the coast of Alaska has discovered what officials fear might be another spy balloon, and they’re bringing it to shore. Three sources… pic.twitter.com/1MkjdqyEL3

— R A W S A L E R T S (@rawsalerts) March 1, 2024

Sources tell CNN that FBI agents will meet the vessel when it arrives at port. Agents will then load the debris into a plane, where it will be analyzed at the FBI lab in Quantico, Virginia. This is the same lab that has analyzed other Chinese surveillance balloons. 

“The fishermen shared photographs of the object with law enforcement upon encountering it,” the sources said.

CNN pointed out: 

All three sources emphasized that it wasn’t clear exactly what the object was and that it may not be a balloon at all — but that the FBI determined that it was similar enough in appearance to a foreign-government-owned surveillance balloon that it warranted further investigation.

The FBI acknowledged the debris in a statement last night:

“We are aware of debris found off the coast of Alaska by a commercial fishing vessel. We will work with our partners to assist with the logistics of the debris recovery.”

This comes one week after a mysterious high-altitude balloon was intercepted by NORAD fighter jets over Utah – and one year after a Chinese surveillance balloon was shot down off the coast of South Carolina.  

Authored by Steve Watson via Modernity.news,

A theatre in the West End of London has received fierce criticism for planning to host two nights of a play where white people will not be welcome, in a so called “Black Out”.

The production of Slave Play, which will star the Game of Thrones actor Kit Harington, will run at the Noël Coward theatre, with dates on 17 July and 17 September, only being open to an ‘all-Black identifying audience’.

The theatre describes the events, claiming “Black Out nights are the purposeful creation of an environment in which all-Black identifying audience can experience and discuss an event in the performing arts, film, athletic and cultural spaces – free from the white gaze.”

White theatre goers BANNED from attending ‘Black-Only’ theatre night in London.

Upcoming West End theatre show for ‘Slave Play’ will have “black out nights” for “black identifying audience’ and will ban any white people from attending two special performances so that theatre… pic.twitter.com/XvBy9rBS6L

— Oli London (@OliLondonTV) February 29, 2024

Jeremy O Harris, the playwright of Slave Play, which tells the story of three interracial couples role-playing while on a plantation, told the BBC “I think that one of the things we have to remember is that people have to be radically invited to a space to know that they belong there. In most places in the West, poor people and black people have been told they do not belong inside in a theatre.”

“People have to be radically invited into a space to know that they belong there.”

Playwright @JeremyOHarris explains ‘Black Out’ nights of the West End run of ‘Slave Play’ – inviting only people who identify as Black or Brown to buy tickets for select performances.#BBCWato pic.twitter.com/dDainPWDwj

— The World at One (@BBCWorldatOne) February 27, 2024

Exactly who is telling black people that now in 2024 in London isn’t explained.

He continues, “There are a litany of places in all of our countries that are generally inhabited by only white people. No one is saying by inviting black audiences here you are uninvited. The idea of a Black Out night is to say this is a night where we are specifically inviting black people to fill up this space and feel safe.”

It really does sound a lot like the production has decided to make a point of ‘uninviting’ white people from attending the two shows, or banning them more accurately.

Commenting on the move, co-founder of the Conservatives Against Racism for Equality Albie Amankona urged “Disgraceful, a British theatre banning native Brits. We should not import American style race relations to the UK. ‘Black people & poor people’ have never been told ‘you do not belong in Theatres’ Americans should keep their reverse Jim Crow crap to themselves.”

People in Britain uncomfortable with the “white gaze” should emigrate.

What is keeping you here? I am tired of this sh*t.

You think an African or Caribbean country would do something so self-hating as to ban the native population from a play?

🤡 posing as anti-racists. pic.twitter.com/fFyGhsHh2w

— Albie (@albieamankona) February 29, 2024

Amy Gallagher, the Mayoral candidate for London’s Social Democratic Party, told The Telegraph that the move is “definitely racist,” adding “excluding anyone on the basis of skin colour in this way is racist.”

“They seem to be reverting to a critical race theory definition of racism whereby, according to Ibram X. Kendi, we need present discrimination, against white people, to make up for past discrimination,” Gallagher further noted.

“They say they want to be free from the “white gaze” which, of course, means white people, but they will not go as far to say white people as it would be illegal,” Gallagher urged.

Nickie Aiken, Conservative MP for the Cities of London and Westminster, has written to Culture Secretary Lucy Frazer about the theatre performances, noting “At a time when we see domestic racial tensions running high, why a west end theatre thinks it is acceptable to encourage racial segregation is beyond me.”

A spokesperson for the British Prime Minister told The London Evening Standard that the actions of the production are “concerning,” adding “clearly restricting audiences on the basis of race would be wrong and divisive.”

Harris issued a bizarre response stating “Hey 10 Downing Street and Rishi Sunak… there’s literally a war going on…maybe the death of thousands of Palestinian children should be more “concerning” than a playwright attempting to make the West End more inclusive to those who aren’t historically invited there.” 

Empire Street, the production company behind the London stretch of the play, also issued a statement, refuting the suggestion that white people will be banned, stating “As the producers of Slave Play in the West End, our intent is to celebrate the play with the widest possible audience. We want to increase accessibility to theatre for everyone.”

“The Broadway production conceived of black out nights and we are carefully considering how to incorporate this endeavour as part of two performances in our 13-week run. We will release further details soon. To be absolutely clear, no-one will be prevented or precluded from attending any performance of Slave Play,”  the statement also claimed.

It is illegal in the UK to turn anyone away from an event such as a play in a theatre based on the colour of their skin.

Hence that statement, but everyone knows what the real intention behind such ‘black out’ nights, which have previously been implemented before in London and New York, and have even spread to places like Canada.

My wife is brown, I am white, and all of our kids are mixed. My family and I will enter any theatre we wish to. You will not be able to stop us. Any attempt to do so, on the basis of race, is illegal. pic.twitter.com/w8z907J1Bx

— Mike Fairclough (@1MikeFairclough) February 29, 2024

Why are the BBC supporting a racist and his desire for racial segregation?

— soulstorm_design (David Whyte) (@slstrm_dsgn) February 29, 2024

Anyone else up for buying tickets and turning up at the “black out nights” for the ‘Slave Play’, and then suing the theatre for racial discrimination when denied entry?

— Turning Point UK 🇬🇧 (@TPointUK) February 29, 2024

This guy is absolutely giddy about being an out and proud racist. He can’t believe his luck that he’s allowed to say this stuff.

— Alexandra Marshall (@ellymelly) February 29, 2024

“They weren’t allowed to sit in the theatre with white people”. So he now wants black/ brown people to turn up and not sit with white people 😂😂
So if you are a mixed race couple. Make sure to go different days OK

— leilani dowding 🌸🚜 ☮️ (@LeilaniDowding) February 29, 2024

The man is a racist and wishes to reintroduce segregation and apartheid into the UK in 2024 🙄🤡🤦🏼‍♂️

— NeilTerry2004 (@NeilTerry2004) February 29, 2024

Some racism is OK, evidently.

— NoCsiouS (Ho/Hum) (@nebilcs) February 29, 2024

A number of of states in America enforced Jim Crow laws in the early to mid 19th century. Therefore, white people shouldn’t be allowed to visit the theatre. Makes perfect sense, no?

— Jake Welch (@JakeKieranWelch) February 29, 2024

This is shameful incitement to racial resentment and racial gaslighting. The extent of perverse justification for this boggles the mind. And shame on the feeble @kitharingtoncom for having no spine.

— JacovZ (@Jaco_v_Z) February 29, 2024

Get rid of the Equality Act if it only works in one direction

— Craig Travis (@CraigTravissimo) February 29, 2024

This is racism.

— steve kippax (@stevekippax) February 29, 2024

Can we have a white-only” night so white people can feel safe with our own kind…?

Surely this Jeremy racist wont have a problem with it…

— Jam3sMiddl3ton 🇬🇧 (@Jam3sMidd1eton) February 29, 2024

Pure racial discrimination. Segregation should have no place in our society. This is apartheid.

— Craig Bayliss (@CustardCream007) February 28, 2024

We know who the real bigots are 😉

— Jack Fielding (@JackFielding22) February 28, 2024

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In the latest client note, “The Flow Show: $1 Trillion Every 100 Days,” Bank of America Analyst Michael Hartnett points out how headquarters locations of mega-corporations have shifted around the country over the last three decades.

Hartnett first shows a map of the US resized by the market cap of the largest 100 companies in 1994. Notice how most of the companies were based out of New York, Texas, and California. 

Three decades later, the wealth concentration of mega-corporations has ballooned on the West Coast (not surprising), with California number one and Washington number two. Meanwhile, New York dropped to number three. 

The current distribution of wealth concentration of mega corporations on the West Coast is a bubble. This is because companies are fleeing progressive states, plagued with high taxes and violent crime, for ones like Texas, Arizona, Georgia, and Florida. 

“You have a number of companies recently that have relocated to Texas because it’s supposed to be a friendlier climate for business. And it’s suddenly not as friendly as it was,” Anthony Johndrow, cofounder and CEO of consultancy Reputation Economy Advisors, told Fortune in a separate report. 

The latest Fortune 500 companies that have moved their headquarters to Texas include:

• NRG Energy – moved from Princeton, New Jersey, to Houston
• Tesla – moved from Palo Alto, California, to Austin
• Hewlett Packard Enterprise – moved from San Jose, California, to Spring
• Oracle – moved from Redwood City, California, to Austin
• Charles Schwab – moved from San Francisco, California, to Westlake
• Caterpillar – moved from Deerfield, Illinois, to Irving
• AECOM – moved from Los Angeles, California, to Dallas
• CBRE – moved from Los Angeles, California, to Dallas

We anticipate that the West Coast bubble will continue to deflate in the coming years, with Red states such as Texas and Florida attracting more companies and people due to their safer cities and friendlier business environments.

Authored by Andrew Korybko via Substack,

The Ukrainian Intelligence Committee warned in a Telegram post about the worst-case scenario that could happen by June whereby a Russian breakthrough across the Line of Contact (LOC) merges with protests over conscription and Zelensky’s illegitimacy to deal a deathblow to the state. They predictably claimed that those protests, along with claims of growing fatigue inside Western and Ukrainian societies plus civil-military tensions in Kiev, are just “Russian disinformation” even though they all veritably exist.

“Zelensky Is Desperate To Preemptively Discredit Potentially Forthcoming Protests Against Him” and that’s why he claimed in late November that Russia is conspiring to orchestrate a so-called “Maidan 3” against him, which is what the Intelligence Committee explicitly referred to in their post. Their warning also came as Ukrainian media reported that Zelensky plans to ask the Constitutional Court to rule on holding elections during martial law in order to retain legitimacy after his term expires on May 20.

The preceding hyperlinked report from Turkish media also mentions how “opposition party leaders Petro Poroshenko and Yulia Tymoshenko proposed forming a coalition government to avoid a crisis of legitimacy” but were rebuked by National Security Council chief Danilov. What’s so interesting about this proposal is that it was first tabled by an expert from the powerful Atlantic Council think tank in an article that they published in Politico in mid-December in order to serve that exact same purpose.

This reminder and the subsequent proposal by those two opposition party leaders debunks the notion that questions about Zelensky’s legitimacy are solely the result of “Russian disinformation” just like a top European think tank’s latest poll from January debunks the same about fatigue over this conflict. The European Council on Foreign Relations, which can’t credibly be described as “pro-Russian”, found that only 10% of Europeans think that Ukraine will defeat Russia.

On the other side of the Atlantic, the Congressional deadlock over more Ukraine aid proves that such sentiments are shared in the halls of power, and those who hold these views understandably don’t want to continue throwing hard-earn taxpayer funds into a doomed-to-fail proxy war. Western leaders as a whole, however, are clearly panicking over the latest military-strategic dynamics that followed the failure of Kiev’s counteroffensive last summer and Russia’s recent victory in Avdeevka.

That’s why many of them debated whether to conventionally intervene in Ukraine during Monday’s meeting in Paris that was attended by over 20 European leaders. French President Macron said that this can’t be ruled out despite there being no consensus on the issue, which his Polish counterpart confirmed was the most heated part of their discussions that day. This prompted strong denials from all other Western leaders who claimed that they’ll never authorize this, but their words can’t be taken seriously.

After all, the worst-case scenario that the Ukrainian Intelligence Committee warned about and is actively trying to discredit as supposedly being driven solely by “Russian disinformation” could push them to conventionally intervene in order to avert the state’s collapse and an Afghan-like disaster in Europe. NATO is unlikely to sit idly on the sidelines if Russia steamrolls through the ruins after breaking through the LOC by sometime this summer, hence why a conventional intervention truly can’t be ruled out.

It would be very unpopular in the West as proven by the previously mentioned think tank’s latest poll and the ongoing Congressional deadlock over Ukraine aid, but that doesn’t mean that the elite won’t do it since they don’t take public opinion into consideration when formulating foreign and military policy. Even so, the large-scale protests that could follow in Europe are something that the elite want to avoid, but they might still risk them in order for their geopolitical project in Ukraine not to be totally for naught.

Average folks outside of Ukraine can’t shape the course of events, but those in that country could play an historical role if they revolted with the support of friendly elements in the military-intelligence services like those that surround former Commander-in-Chief Zaluzhny. They’d be putting their lives on the line since the SBU abuses, jails, and kills dissidents, but enough of them are evidently ready to do so as suggested by the Ukrainian Intelligence Committee’s frantic efforts to discredit them.

Bloomberg reports that Ukraine’s “internal battlefield assessments” say Russia could gain the momentum needed for a summer 2024 breakthrough if the West doesn’t cough up more ammo supplies in time. https://t.co/l8ZlqLOS5b

— Kevin Rothrock (@KevinRothrock) February 29, 2024

It’s too early to predict whether they’ll revolt, let alone at the scale and for the duration that’s required to depose Zelensky with a view towards immediately resuming peace talks since the CIA-backed SBU could scuttle their plans by arresting their leaders (especially those in the military-intelligence services). If they do and this coincides with Russia breakthrough through the LOC, however, then it could swiftly bring an end to this proxy war provided that there are friendly elites willing to risk their lives as well.

Considering the global significance of this conflict, what’s regarded as the worst-case scenario from the perspective of the ruling Ukrainian elite and their Western masters is therefore the best-case scenario for the rest of the world. In the event that Zelensky is deposed and peace talks immediately resume right as Russia breaks through the LOC, then NATO might not feel as pressured by its security dilemma with Russia to conventionally intervene in Ukraine, thus reducing the risk of World War III by miscalculation.

Authored by Pepe Escobar,

Very few people in Russia and across the Global South are as qualified as Sergei Glazyev, the Minister for Integration and Macroeconomics of the Eurasia Economic Commission (EEC), the policy arm of the Eurasia Economic Union (EAEU), to speak about the drive, the challenges and the pitfalls in the road towards de-dollarization.

As the Global South issues widespread calls for real financial stability; India inside the BRICS 10 makes it clear that everyone needs to think seriously about the toxic effects of unilateral sanctions; and Professor Michael Hudson keeps reiterating current policies are not sustainable anymore, Glazyev graciously received me at his office at the EEC for an exclusive, extensive conversation, including fascinating off the record odds and ends.

These are the highlights – as Glazyev’s ideas are being re-examined, and there’s huge expectation for the green light from the Russian government for a new trade settlement model – which for the moment is in the final stages of fine-tuning.

Glazyev explained how his main idea was “elaborated a long time ago. The basic idea is that a new currency should be first of all introduced on the basis of international law, signed by the countries which are interested in the production of this new currency. Not via some kind of conference, like Bretton Woods, with no legitimacy. At the first stage, not all countries would be included. BRICS nations will be enough – plus the SCO. In Russia, we already have our own SWIFT – the SPFS. We have our currency exchange, we have correspondent relations between banks, consultation between Central Banks, here we are absolutely self-sufficient.”

All that leads to adopting a new international currency: “We don’t really need to go large scale. BRICS is enough. The idea of the currency is that there are two baskets: one basket is national currencies of all countries involved in the process, like the SDR, but with more clear, understandable criteria. The second basket are commodities. If you have two baskets, and we create the new currency as an index of commodities and national currencies, and we have a mechanism for reserves, according to the mathematical model that will be very stable. Stable and convenient.”

Then it’s up to feasibility: “To introduce this currency as an instrument for transactions would not be too difficult. With good infrastructure, and all Central Banks approving it, then it’s up to businesses to use this currency. It should be in digital form – which means it can be used without the banking system, so it will be at least ten times cheaper than present transactions through banks and currency exchanges.”

That Thorny Central Bank Question

“Have you presented this idea to the Chinese?”

“We presented it to Chinese experts, our partners at Renmin University. We had good feedback – but I did not have the opportunity to present it on a political level. Here in Russia we promote the discussion via papers, conferences, seminars, but there’s still no political decision on introducing this mechanism even on the BRICS agenda. The proposal by our team of experts is to include it in the agenda of the BRICS summit next October in Kazan. The problem is the Russian Central Bank is not enthusiastic. The BRICS have only decided on an operating plan to use national currencies – which is also a quite clear idea, as national currencies are already used in our trade. Russian ruble is the main currency in the EAEU, trade with China is conducted in rubles and renminbi, trade with India and Iran and Turkiye also switched to national currencies. Each country has the infrastructure for it. If Central Banks introduce digital national currencies and allow them to be used in international trade, it’s also a good model. In this case crypto exchanges can easily balance payments – and it’s a very cheap mechanism. What is needed is an agreement from Central Banks to allow a certain amount of national currencies in digital form to participate in international transactions.”

“Would that be feasible already in 2024, if there is political will?”

“There are some start-ups already. By the way, they are in the West, and the digitalization is conducted by private companies, not Central Banks. So the demand is there. Our Central Bank needs to elaborate a proposal for the summit in Kazan. But this is only one part of the story. The second part is price. For the moment price is determined by Western speculation. We produce these commodities, we consume them, but we do not have our own price mechanism, which will balance supply and demand. During the Covid panic, the price for oil fell to nearly zero. It’s impossible to make any strategic planning for economic development if you do not control prices of basic commodities. Price formation with this new currency should get rid of Western exchanges of commodities. My idea is based on a mechanism that existed in the Soviet Union, in the Comecon. In that period we had long-term agreements not only with socialist countries, but also with Austria, and other Western countries, to supply gas for 10 years, 20 years, the basis of this price formula was the price for oil, and the price for gas.”

So what stands out is the effectiveness of a long-term, long view policy: “We did create a long-term pattern. Here in the EEC we are looking at the idea of a common exchange market. We already prepared a draft, with some experiments. The first step is the creation of an information network, exchanges in different countries. It was rather successful. The second step will be to set up online communication between exchanges, and finally we move to a common mechanism of price formation, and open this mechanism for all other countries. The main problem is that the major producers of commodities, first of all the oil companies, they don’t like to trade through exchanges. They like to trade personally, so you need a political decision to make sure that at least half of production of commodities should go through exchanges. A mechanism where supply and demand balance each other. For the moment the price of oil in foreign markets is ‘secret’. It’s some type of colonial times thinking. ‘How to cheat’. We must create legislation to open all this information to the public.”

The NDB in Need of a Shake-up

Glazyev offered an extensive analysis of the BRICS universe, based on how the BRICS Business Council had its first meeting on financial services in early February. They agreed on a working plan; there was a first session of fintech experts; and during this week a breakthrough meeting may lead to a new formulation – for the moment not made public – to be put into the BRICS agenda for the October summit.

“What are the main challenges within the BRICS structure in this next stage of trying to bypass the US dollar?”

“BRICS in fact is a club which doesn’t have a secretariat. I can tell it, from a person that has some experience in integration. We discussed the idea of a customs union here, on the post-Soviet territory, immediately after the collapse. We had a lot of declarations, even some agreements signed by heads of state, over a common economic space. But only after the establishment of a commission the real work stated, in the year 2008. After 20 years of papers, conferences, nothing was done. You need someone who’s responsible. In BRICS there is such an organization – the NDB [New Development Bank]. If the heads of state decide to appoint the NDB as an institution which will elaborate the new model, the new currency, organize an international conference with the draft of an international treaty, this can work. The problem is that the NDB works according to the dollar charter. They have to reorganize this institution in order to make it workable. Now it works like an ordinary international development bank under the American framework. The second option would be to do it without this bank, but that would be much more difficult. This bank has enough expertise.”

“Could an internal shake-up of the NDB be proposed by the Russian presidency of BRICS this year?”

“We are doing our best. I’m not sure the Ministry of Finance understands how serious this is. The President understands. I personally promoted this idea to him. But the chairman of the Central Bank, and ministers are still thinking in the old IMF paradigm.”

‘Religious Sects Don’t Create Innovation’

Glazyev had a serious discussion on sanctions with the NDB:

“I discussed this issue with Mrs. Rousseff [the former Brazilian President, currently presiding the NDB) at the St. Petersburg Forum. I gave her a paper about it. She was rather enthusiastic and invited us to come to the NDB. But afterwards there was no follow-up. Last year everything was very difficult.”

On BRICS, “the financial services working group is discussing reinsurance, credit rating, new currencies in fintech. That’s what should be in the agenda of the NDB. The best possibility would be a meeting in Moscow in March or April, to discuss in depth the whole range of issues of BRICS settlement mechanism, from most sophisticated to least sophisticated. It would be great if the NDB sign up for it, but as it stands there is a de facto gulf between the BRICS and the NDB.”

The key point, insists Glazyev, is that “Dilma should find time to organize these discussions at a high level. A political decision is needed.”

“But wouldn’t that decision have to come from Putin himself?”

“It’s not so easy. We heard statements by at least three heads of the state: Russia, South Africa and Brazil. They publicly said ‘this is a good idea’. The problem, once again, is there is no task force yet. My idea, which we proposed before the BRICS summit in Johannesburg, is to create an international working group – to prepare in the next sessions the model, or the draft, of the treaty. How to switch to national currencies. That’s the official agenda now. And they have to report about that in Kazan [for the BRICS annual summit]. There are some consultations between the Central Banks and Ministers of Finance.”

Glazyev cut to the chase when it comes to the inertia of the system: “The main problem for bureaucrats and experts is ‘why they don’t have ideas?’ Because they assume the current status quo is the best one. If there are no sanctions, everything will be good. The international financial architecture that was created by the United States and Europe is convenient. Everyone knows how to work in the system. So it’s impossible to move from this system to another system. For businesses it will be very difficult. For banks it will be difficult. People have been educated in the paradigm of financial equilibrium, totally libertarian. They don’t care that prices are manipulated by speculators, they don’t care about volatility of national currencies, They think it’s natural (…) It’s a kind of religious sect. Religious sects don’t create innovation.”

Now Get on That Hypersonic Bicycle

We’re back to the crucial issue of national currencies: “Even five years ago, when I spoke about national currencies in trade, everybody said it was completely impossible. We have long-term contracts in dollars and euro. We have an established culture of transactions. When I was Minister of Foreign Trade, 30 years ago, at the time I tried to push all our trade in commodities into rubles. I argued with Yeltsin and others, ‘we have to trade in rubles, not in dollars’. That would automatically make the ruble a reserve currency. When Europe moved to the euro, I had a meeting with Mr. Prodi, and we agreed, ‘we will use euro as your currency, and you will use rubles’. Then Prodi came to me after consultations and said, ‘I talked to Mr. Kudrin [former Russian Finance Minister, 2000-2011], he didn’t ask me to make the ruble a reserve currency’. That was sabotage. It was stupidity.”

The problems actually run deep – and keep running: “The problem was our regulators, educated by the IMF, and the second problem was corruption. If you trade oil and gas in dollars, a large part of profits is stolen, there are a lot of intermediate companies which manipulate prices. Prices are only the first step. The price for natural gas in the first deal is about 10 times less than the final demand. There are institutional barriers. A majority of countries do not allow our companies to sell oil and gas to the final customer. Like you cannot sell gas to households. Nevertheless, even in the open market, quite competitive, we have intermediates between producer and consumer – at least half of the revenues are stolen from government control. They don’t pay taxes.”

Yet fast solutions do exist: “When we were sanctioned two years ago, transfer from US dollar and euro to national currencies took only a few months. It was very quick.”

On investments, Glazyev stressed success in localized trade, but capital flows are still not there: “The Central Banks are not doing their job. The ruble-renminbi exchange is working well. But the ruble-rupee exchange doesn’t work. The banks that keep these rupees, they have a lot of money, accrue interest rates on these rupees, and they can play with them. I don’t know who’s responsible for this, our Central Bank or the Indian Central Bank.”

The succinct, key takeaway of Glazyev’s serious warnings is that it would be up to the NDB – prodded by the leadership of BRICS – to organize a conference of global experts and open it for public discussion. Glazyev evoked the metaphor of a bicycle that keeps rolling along – so why invent a new bicycle? Well, the – multipolar – time has come for a new hypersonic bicycle.

South Korea broke its own record when it announced this week that as of 2023, its fertility rate had fallen to just 0.72 births per woman.

The rate at which a population replaces itself between generations without migration stands at around 2.1.

As Statista’s Katharina Buchholz reports, the following map with comparable data between countries from 2021, shows that even then South Korea was one of only a few places in the world with a fertility rate below 1.

You will find more infographics at Statista

In Japan, which on Tuesday announced a 5 percent decline in births to a record low of 758,631, the birth rate remained at 1.26. This places the country among the approximately 90 in the world where populations are not growing independent of immigration. Also in this group are many nations from Europe, the Americas and Southeast Asia. Most of the countries losing fertility are better developed and reasons for the trend include greater access to contraception and more women being educated and heading to work.

The story is different in the developing world where higher rates of fertility are fueling continued global population growth. The West African country of Niger had a fertility rate of 6.8 in 2021, the highest in the world listed by the World Bank, followed by Somalia, Chad and the Democratic Republic of the Congo. Out of the 33 countries in the world where women had 4 or more children on average, 31 were in Africa that year.

On average, women in 1963 were having 5.3 children in their lifetime and by 2021, that had more than halved to 2.3. During the same period, the global population rose by around 150 percent from 3.2 billion to 7.9 billion. The fact that populations kept (and keep) growing despite falling global fertility is tied to longer life expectancy and lower childhood mortality.

The UN expects global fertility to reach the minumum replacement level of 2.1 by the middle of the century while global population is expected to start falling towards the end of it.