Month: April 2024

Authored by Matthew Vadum via The Epoch Times (emphasis ours),

A complex upcoming Supreme Court case could weaken a key tool the government uses in immigration law enforcement and throw the system into chaos, legal sources say.

The case at hand deals with the doctrine of “consular nonreviewability,” which is the legal principle that a consular official’s decision to refuse a visa to a foreigner is not subject to judicial review.

Cracking down on the doctrine would harm the immigration system and cripple its ability to conduct business, supporters of the nonreviewability principle say. Opponents, such as those who favor expanded immigration, say relaxing it respects constitutional rights and the institution of marriage.

The doctrine is a judge-made exception to the Administrative Procedure Act (APA), a federal statute enacted in 1946 that governs administrative law procedures for federal executive departments and independent agencies. The late U.S. Sen. Pat McCarran (D-Nev.) said the APA was “a bill of rights for the hundreds of thousands of Americans whose affairs are controlled or regulated in one way or another by agencies of the federal government.”

Decisions about who gets to enter the United States are vested in the legislative and the executive branches, not the judicial branch.

The U.S. Constitution gives Congress exclusive authority to create policies about the admissibility of individuals to the United States. At the same time, the legislative branch delegates the power to implement those policies to the executive branch.

On April 23, the Supreme Court will hear Department of State v. Munoz, which concerns spousal sponsorship.

Facts of the Case

Foreign citizens have minimal rights in the immigration process, so the Supreme Court is expected to focus on whether U.S. citizens have a constitutionally protected interest in visa petitions sponsoring their spouses.

The case is about Luis Asencio-Cordero, a Salvadoran citizen with no criminal record whose U.S. immigration visa was denied because a consular officer thought his tattoos indicated gang membership. His wife, U.S. citizen Sandra Munoz, challenged the consular decision in court, arguing that her rights as a citizen were violated.

The case goes back to 2005 when Mr. Asencio-Cordero first arrived in the United States. Ms. Munoz married him in 2010 and they had a child together who is a U.S. citizen. The husband was in the country illegally.

Ms. Munoz sponsored her husband for a U.S. immigration visa. In 2015 he returned to his native El Salvador to obtain the visa. At the initial interview at the U.S. consulate in San Salvador, he was subjected to a body search.

The officials photographed his tattoos and asked why he got them. They found a tattoo of comedy and tragedy theater masks, one of a pair of dice, and one of three ace cards. Other tattoos depicted the Virgin of Guadalupe, Sigmund Freud, and a tribal design featuring a paw print.

Officials asked Mr. Asencio-Cordero about his criminal record. He said he was arrested once when he got into a fight with a friend. They were held in jail for three days and released with no charges being laid.

After a significant delay, officials ruled that Mr. Asencio-Cordero could not be issued a visa because he was viewed as criminally inadmissible to the United States.

Officials didn’t elaborate other than to cite a passage in the Immigration and Nationality Act which states “[a]ny alien who a consular officer or the Attorney General knows, or has reasonable ground to believe, seeks to enter the United States to engage solely, principally, or incidentally in … any other unlawful activity” is inadmissible.

The government argues that under federal law the visa denial cannot be challenged in court.

Ms. Munoz sued. Three years after the denial, she learned during the discovery process in federal district court that the government deemed him inadmissible to the country because he was thought to be a member of the MS-13 criminal organization.

The consular official reached this conclusion based on “the in-person interview, a criminal review of Mr. Asencio-Cordero, and a review of [his] tattoo,” U.S. Solicitor General Elizabeth Prelogar wrote in the government’s petition to the Supreme Court.

She wrote in a footnote that the government also presented to the court “for in camera review, State Department documents containing sensitive information describing the basis for the consular officer’s belief that Asencio-Cordero was a member of MS-13.”

The district court ruled in favor of the government in March 2021 and noted the consular officer’s finding that Mr. Asencio-Cordero was a member of MS-13.

Because the denial was based on “a facially legitimate and bona fide reason, the court ruled that consular nonreviewability precludes respondents’ challenges to the Department decision,” Ms. Prelogar wrote.

Court of Appeals

A divided panel of the U.S. Court of Appeals for the 9th Circuit vacated the district court’s ruling and remanded the case to the lower court for reconsideration.

The 9th Circuit did not reject consular nonreviewability but held that, on the facts of the case, the application of the doctrine violated the Due Process Clause of the U.S. Constitution.

The circuit court affirmed the district court’s holding that Ms. Munoz’s due process rights had been violated because as a U.S. citizen, she had both “a fundamental liberty interest in their marriage” and “a liberty interest in residing in their country of citizenship.” The denial harmed her due process rights because its cumulative effect was “a direct restraint on [her] liberty interests.”

The court also held that because the government had waited three years after the denial of the visa to provide the married couple with the declaration about the tattoo “and did so only when prompted by judicial proceedings,” the explanation was deemed untimely.

The court concluded that the government had forfeited its claim of consular nonreviewability by failing to hand over a timely explanation to the couple. The visa decision cannot be “shield[ed] … from judicial review” and the district court “may ‘look behind’ the government’s decision[.]”

The full 9th Circuit denied a rehearing of the case in July 2023, upholding the panel’s ruling.

Judge Patrick Bumatay dissented from the denial of the rehearing, writing that the panel was wrong to find that Ms. Munoz had a “liberty interest” in the visa denial of her husband.

And this “novel ‘timeliness’ requirement has no basis in the law,” he wrote. Throughout the 100-year existence of consular nonreviewability “no court has invented the rule that the government must act within a certain timeframe[.]”

“Congress has explicitly said that the government has no duty to give timely notice to an alien excluded on security-related grounds,” the judge wrote.

Read more here…

Woke progressives have spent a considerable amount of time and energy over the past several years trying to hide and deny the existence of the Diversity, Equity and Inclusion agenda.  The reasons are obvious – The philosophy removes all merit from society and replaces it with a cult of perceived oppression.  Academic prowess, mental drive, personal success, inherent intelligence or toughness; none of these things matter anymore when it comes to college admissions, corporate employment, municipal job access or political promotion. 

All that has mattered for almost a decade is skin color, gender, sexual orientation and how much a person’s minority status raises the ESG score of a particular institution.   

DEI goes far beyond the notion of Affirmative Action.  While the value of AA alone is questionable in western societies today, it is simply a legal affirmation that companies should hire minorities that have the correct qualifications and not ignore them based merely on their ethnicity.  Does AA still lead to unqualified hires?  Yes.  But DEI takes the problem to a whole new level by incentivizing the erasure of merit as a “social construct.”  

That is to say, DEI demonizes the concept of merit as evil and racist.  Such an ideology can only lead to one thing:  The saturation of all important jobs and positions with people that represent the lowest common denominator, not to mention the inevitable downfall of civilization. 

The effects of hiring practices based on woke virtue signaling are becoming more apparent by the day.  Corporations that engage in DEI all see the quality of their labor, the quality of their management and the quality of their products and services decline.  It is a near guarantee that any company that goes woke will eventually go broke (unless they are getting artificial support from investment firms and government programs).  

The proliferation of the system has led to a growing public outcry, not only because DEI is specifically discriminatory against straight white men even when they are the best candidates for higher education or a particular job, but also because hiring the unqualified leads to a degradation of value everywhere we turn. 

Most people don’t care if a doctor or lawyer or firefighter or architect or their manager in charge is a minority, they just want the best person for the job.  DEI makes this impossible.  By creating quotas and percentages of minority representatives within any working environment, there is no way to fill those positions without hiring people that fail the basic standards.  There aren’t enough qualified minorities in existence to meet the fabricated demand.

Beyond that, DEI is detrimental to minority professionals with actual skills, because now whenever we see a minority in a vital job we’re going to wonder if they got that position because they’re capable or because of their skin color and sexual preferences.  

In other words, DEI = Didn’t Earn It.

The political left is outraged at the exposure of DEI and have taken to social media recently to declare the use of the term a “racial slur.”  As the Mayor of Baltimore, Brandon Scott, argued in his interview with Joy Reid on MSNBC, he thinks white people who say “DEI” are using it in place of the “N-word.”  

Baltimore Mayor Brandon Scott:

“White people use the term DEI hire because they don’t have the courage to say the N-word.”

A national tragedy where multiple people are dead and missing and Joy Reid and Mayor Scott want to make it about race? Despicable. pic.twitter.com/BwvEHZhYwo

— Charlie Kirk (@charliekirk11) March 28, 2024

It should be noted that Baltimore has had minority mayors in power since 1987 (with the exception of Martin O’Malley) and the city has been in steep decline for decades.  Of course, correlation is not necessarily causation – The fact that all of these mayors were Democrats might have more to do with the city’s problems than their skin color.  The point is, Brandon Scott has no room to blame white people for the failings of his city.  Black people have been in charge of Baltimore for a long time; maybe it’s time to take responsibility.

And this is the crux of DEI thinking, isn’t it?  Adherents to the ideal want more access to “power” and authority without without the talent needed to handle it or the responsibility required to wield it.  They want access to college education based on assumed disadvantage rather than real accomplishment.  They want accolades for simply existing as minorities in a world they claim is holding them back, all while being treated with kid gloves and extensive privilege.

Truly successful people don’t need to have their hands held through the process of life at every turn.  They accomplish their goals through hard work, intelligence and persistence.  Leftists say that DEI is necessary because there are “invisible barriers for minority groups” in the west.  This is a lie.

A perfect example is the Asian community, which is a tiny portion of the US population yet they find academic and business success at an extraordinary rate.  Promoters of DEI constantly ignore the data when it comes to Asians in America and are often hostile towards them exactly because they win on merit alone, proving the entire basis of DEI wrong.  Diversity quotas within many colleges have even discriminated against Asians in favor of other minorities (or female applicants) because they are considered “too advantaged.”  The problem was so pervasive it was taken to the Supreme Court in 2023. 

The bottom line is that merit is the only reasonable way to run a society.  Once decisions are made and leaders are chosen based on who claims they are the most historically oppressed there is no way to clarify value.  Who is truly more worthy – A person whose DNA barely connects them to trespasses from distant history?  Or, a person who is able to do the job right?  Diversity is not necessarily strength. Historic oppression is meaningless.  Merit is everything.

Authored by Daniel Lacalle,

In a recent CNN poll, 48% of respondents stated that they believe the economy remains in a downturn, and only 35% said that things in the country today are going well. The disparity between somber economic sentiment and a surprisingly strong headline unemployment rate and Gross Domestic Product (GDP) can be easily explained.

The divergence between headline GDP and Gross Domestic Income (GDI) is staggering. While GDP suggests a strong economy, GDI reveals a stagnant economy. Both measures used to follow a similar pattern, but this changed drastically in 2023. While GDP rose 2.5% in 2023, GDI only bounced 0.5%, effectively signaling economic stagnation.

According to the Bureau of Economic Analysis, real GDI increased only 0.5% in 2023, compared with an increase of 2.1% in 2022. If we use the average of real GDP and real GDI, it increased only 1.5% in 2023, compared with an increase of 2.0% in 2022. Not a recession, but certainly a weak economy.

The unemployment figures show weakness as well. Real wage growth in the past four years has been negligible, at 0.7% per year, four times weaker than the previous four years. Furthermore, the labor force participation rate remains below the pre-pandemic level at 62.5%, the same as the employment-population ratio at 60.1%. Poor real average hourly earnings combined with a decrease of 0.6% in the average workweek resulted in an uninspiring 0.5% increase in real average weekly earnings in the year to February 2024.

There is also a weak trend in profits. In 2023, profits from current production (corporate profits with inventory valuation and capital consumption adjustments) increased $49.3 billion, compared with an increase of $285.9 billion in 2022, according to the BEA. Profits of domestic nonfinancial corporations increased $66.6 billion, compared with an increase of $247.6 billion in 2022. This is a very weak trend.

All these figures indicate that the US economy is performing significantly better than the euro area, but it is still far below expectations.

Keynesianism is working against the potential of the United States economy. The accumulated $6.3 trillion deficit of the past four years had a negative impact on the economy. Rising taxes and persistent inflation are eroding the average American quality of life. More citizens need to hold more than one job to make ends meet, and the number of multiple jobholders has reached a multi-decade record.

Gross Domestic Income proves the economy is stagnant, and if we look at GDP and GDI excluding the accumulation of debt, they show the worst year since the 1930s.

How can an economy be stagnant with 2.5% GDP growth? Here is the failure of Keynesianism in all its glory. Headline aggregated figures are optically strong due to the accumulation of debt, and employment figures are bloated by government jobs, disguising a struggling private sector and a weakening purchasing power of the currency.

Cheap money is very expensive in the long run, and discontent rises as Keynesianism focuses on increasing the public sector while the productive economy suffers higher taxes and more challenges to pay the bills.

Inflation is a consequence of the misguided increase in government spending and debt monetization in the middle of a post-pandemic recovery, leading to an aggregate loss of purchasing power of the currency that is close to 24% in the past four years. The government is taking in inflation what it promises in entitlement spending. The result? You are poorer.

It is dangerous to blame Americans’ discontent on a lack of information.

Americans are suffering a prohibitive tax wedge as well as the hidden tax of inflation just because the government decided to play the oldest trick in the book: promise “free stuff” and print new currency through deficit spending, which makes the allegedly free programs more expensive than ever.

The failure of Keynesianism is evident. Sadly, politicians will promise more Keynesianism and present themselves as the solution to the problem they have created.

An Easter weekend storm that dumped heavy rain across Los Angeles and snow in the mountains is set to cause adverse weather conditions across the nation’s heartland as April begins. 

“What starts in the West must eventually come East,” FOX Weather Meteorologist Jane Minar said, adding, “All of that energy, as it shifts through the weekend over the Four Corners, gets a second life as it develops over the central US.” 

On Monday and Tuesday, the storm will traverse the Central and Eastern regions of the US, unleashing severe thunderstorms that could spawn tornadoes. Areas across the Midwest to the Mid-Atlantic could see flooding rain. 

FOX Weather shows that about 50 million Americans are at risk of severe weather on Monday, from Waco, Texas, to St. Louis to Cincinnati to even Ronakoe, Virginia. 

On Tuesday, the storm will traverse the Tennessee and Ohio Valleys and is expected to enter the Mid-Alantic area. 

National Weather Service forecasters warned on Facebook that “all forms of severe weather will be possible” in these areas. 

NWS models forecast an intense, heavy, elevation-dependent winter blast across New England on Wednesday or Thursday. 

The SEVERE and FLOOD side is Monday and Tuesday and the SNOW side for the northeast especially New England is Wednesday into Saturday and looks to be long duration and include coastal impacts as well.@weathermodels_ pic.twitter.com/AOLSiJpNMx

— Jim Cantore (@JimCantore) April 1, 2024

“Spring is known as one of the most chaotic times for seriously disruptive weather in North America,” said weather forecaster Matthew Cappucci of the Capital Weather Gang. 

Cappucci explained why, “Clashing air masses — stemming from crescendoing seasonal warmth and lingering winter cold — can brew powerful weather systems such as this incipient storm.” 

Via SchiffGold.com,

Welcome to the world of modern economics where the term “inflation” no longer signifies the increase in the quantity of money, but has evolved into a plethora of buzzwords. From “shrinkflation” to “greedflation,” these new terms and semantic shifts are by no means harmless but a manipulation of popular sentiment. Von Mises said they play “an important role in fomenting the popular tendencies toward inflationism.”

The following article was originally published by the Mises Institute. The opinions expressed do not necessarily reflect those of Peter Schiff or SchiffGold.

Followers of the Austrian school of economics know that the term inflation refers to increasing the quantity of money or money substitutes. The result being a rise in the price of goods and services or a fall in the value of money. But, in the modern era, this rise in prices is called inflation and as Ludwig von Mises wrote, “This semantic innovation is by no means harmless.”

The semantic change has people looking everywhere but where they should to blame for higher prices.

Bloomberg’s Enda Curran writes, “A prolonged period of elevated inflation has left consumers cranky and eager to cast blame.” With the term inflation evidently getting tiresome, Curren lists some new price increase buzzwords and phrases.

“Shrinkflation” This is the President’s favorite. He even mentioned it in his State of the Union speech. The White House posted on X, “President Biden is calling on companies to put a stop to shrinkflation.” In other words, put more cookies back in the bag or make Snickers bars the same size they used to be. Even Sesame Street’s Cookie Monster has complained his cookies were getting smaller.

“Drip Pricing” These are fees which are added for your luggage when you fly or resort fees added on to your hotel bill. Processing and service fees were called junk fees by President Biden in last year’s State of the Union speech and he vowed to fight “those hidden surcharges too many companies use to make you pay more.” As if the hotel clerk puts a gun to your head at checkout time.

“Greedflation” Ms. Curren says “It’s a modern take on profiteering — “‘making an unreasonable profit on the sale of essential goods especially during times of emergency.’” Of course, price is how goods are distributed during a shortage or any other time as opposed to, as the Economist magazine wrote,” something worse, such as rationing or queues.”

“Excuseflation” This one sounds a lot like the above-mentioned “greedflation.” Curren cites a paper by UBS AG chief global economist Paul Donovan, who claims developed economies are in a period “when some companies spin a story that convinces customers that price increases are ‘fair,’ when in fact they disguise profit margin expansion.” A baker in Chicago said on an Bloomberg Odd Lots podcast that global news events allow him to raise prices “without getting a whole bunch of complaining from the customers.”

“Sellers’ Inflation” This term is credited to Isabella Weber, an assistant professor of economics at the University of Massachusetts who claims large corporations have market power and “have used supply problems as an opportunity to increase prices and scoop windfall profits.” Her solution is price controls, which would lead to long lines and rationing.

“Disinflation” Prices are rising but at a lower rate of change.

Immaculate disinflation. Curren says this is the “optimistic notion” that Jerome Powell and the economists at the Eccles Building can bring prices under control without putting a bunch of people out of work. The Federal Reserve can either create money fast or create money slow. That’s all it has. Jerome Powell is not the economy’s Geppetto.

Murray Rothbard explained where inflation comes from everywhere and always:

The fault of inflation is not in business “monopoly,” or in union agitation, or in the hunches of speculators, or in the “greediness” of consumers; the fault is in the legalized counterfeiting operations of the government itself. For the government is the only institution in society with the power to counterfeit — to create new money. So long as it continues to use that power, we will continue to suffer from inflation, even unto a runaway inflation that will utterly destroy the currency.

Inflation, or whatever you want to call it, is nothing more than government taxation in stealth form. Only the government can conjure up new money from nothing, using it to bid away resources from private individuals.

US futures extend their record-breaking meltup following the long weekend (which was to be expected with hedge funds piling into shorts last week, hoping for a reversal), with most European markets still closed and Asian stocks closing lower. As of 7:30am, S&P futures were 0.3% higher, but trading near session lows; Nasdaq futures gained 0.4%. Bond yields are 1-3bp higher with the USD unchanged from its Friday close. Commodities are mixed: oil down and metals are mostly higher this morning as China PMIs beat expectations. While bitcoin suffered one of its trademark futures slamdowns overnight to push it back below $70K despite relentless ETF inflows, gold was on a tear and rose 1.6% to hit a new all time high of $2,265 before easing back. after upbeat China factory data added to Friday’s relatively benign US core PCE figures. This week, keep an eye on Payrolls, ISMs, and Fedspeak (8x this week), and today, we get the Mfg ISM at 10am ET where consensus expects a 48.3 print vs. 47.8 prior.

In premarket trading, megacap tech names were mostly higher with NVDA/MU/AMD up more than 1%. AT&T fell as much as 2% in premarket trading after the telecom giant said that personal data from about 7.6 million current account holders and 65.4 million former customers was leaked onto the dark web. Nikola rose as much as 16% in premarket trading, set to extend gains for a record-setting ninth consecutive session.

A slow down in the Fed’s preferred measure of inflation last month, coupled with a rebound in household spending, suggests that bullish narratives that propelled stocks to records this year remains intact. The core PCE price index, which strips out the volatile food and energy components, rose 0.3% from the prior month, slowing from January’s surprisingly strong reading, suggesting the Fed is still on pace for a June rate cut.

With markets in Europe, Australia and Hong Kong still shut for the Easter holiday, Asian stock benchmark which were open fell in the first trading day of the second quarter, as investors sold Japanese shares following a record-breaking rally and bought into Chinese equities. The MSCI Asia Pacific Index declined as much as 0.7%, with Toyota and Mitsubishi UFJ Financial among the biggest drags. Following the strongest quarter for the Nikkei 225 average in almost 15 years, investors booked profits as Japan’s new fiscal year kicked off and Japanese equities fell after a report showed confidence among the country’s large manufacturers weakened.

Meanwhile, China stocks led gains in Asia on Monday following a rebound in domestic manufacturing activity that reinforced hopes that economic growth is gaining traction. Chinese stocks rallied as a rebound in manufacturing activity reinforced hopes that the nation’s economic recovery may be starting to gain traction. The benchmark CSI 300 Index rose 1.6% to lead gains in Asia. “Emerging optimism about China is real,” said Vishnu Varathan, chief economist for Asia ex-Japan at Mizuho Bank in Singapore.  Benchmarks in Taiwan and Indonesia were lower, while those in India, South Korea and Singapore climbed. Markets in Hong Kong, Australia and New Zealand were shut for a holiday.

In FX,

In rates, the Treasury yield curve remained steeper vs Thursday’s close after gapping wider at the Asia open. Front-end yields are richer by around 2bp after opening gapping lower, with many European markets still closed.  Front-end outperformance steepens 2s10s spread by nearly 3bp, 5s30s by more than 3bp. 10-year yields around 4.21%, up ~1bp; 30-year yields are cheaper by almost 3bp on the day at around 4.37% The front-end outperformance stems from February PCE deflators released Friday and comments by Fed Chair Powell that left intact expectations for rate cuts this year. US session includes manufacturing PMIs; ahead this week are several Fed speakers and March jobs report. Fed-dated OIS contracts price in slightly more rate cuts for the year vs Thursday, with 74bp of easing expected by December vs 70bp prior.

In commodities, oil dipped after hitting a fresh 5 month high last week. Gold jumped to a record as indications the Federal Reserve is getting closer to cutting interest rates added impetus to a rally that’s also been driven by geopolitical tensions and robust Chinese demand. Bullion jumped to as much as $2,265.73 an ounce on Monday, up 1.6% from Thursday’s close, after setting a series of peaks in recent sessions. Silver meanwhile continue to underperform and remains about 50% below its 2011 highs.

A host of positive drivers have pushed up bullion by around 14% since the middle of February. The prospect of monetary easing by major central banks, and elevated tensions in the Middle East and Ukraine have underpinned the rally. There’s also been strong buying by central banks, particularly in China, while consumers there have been loading up on the metal amid ongoing problems in Asia’s largest economy.

US economic data slate includes the US manufacturing PMI (9:45am), February construction spending and March ISM manufacturing (10am); ahead this week are JOLTS job openings and factory orders (Tuesday), ADP employment change and services PMIs (Wednesday), and the March jobs report. Fed speaker slate includes Cook at 6:50pm; Bowman, Williams, Mester, Daly, Goolsbee, Powell, Barr, Kugler, Harker, Barkin, Musalem and Logan have appearances scheduled.

Market Snapshot

• S&P 500 futures up 0.4% to 5,328.75
• MXAP down 0.6% to 175.87
• MXAPJ little changed at 537.52
• Nikkei down 1.4% to 39,803.09
• Topix down 1.7% to 2,721.22
• Shanghai Composite up 1.2% to 3,077.38
• Sensex up 0.5% to 74,022.68
• Kospi little changed at 2,747.86
• Brent Futures up 0.2% to $87.18/bbl
• Gold spot up 1.3% to $2,258.11
• US Dollar Index little changed at 104.50

Top Overnight News

• China’s NBS PMIs for March came in solidly ahead of expectations, with manufacturing at 50.8 (up from 49.1 in Feb and above the Street’s 50.1 forecast) and non-manufacturing at 53 (up from 51.4 in Feb and above the Street’s 51.5 forecast). China’s Caixin manufacturing PMI came in at 51.1 for Mar, a small beat vs. the consensus forecast of 51 and up modestly from 50.9 in Feb. FT
•  Some of the biggest U.S. companies in artificial intelligence have asked their Taiwanese manufacturing partners to step up production of AI-related hardware in Mexico, seeking to diminish reliance on China. Taiwan-based Foxconn, the world’s largest contract electronics manufacturer, and other Taiwanese companies are heeding the call and investing more in Mexico, according to industry executives and analysts. WSJ
• Taiwan’s former president, Ma Ying-jeou, is set to visit mainland China, and could meet with Xi, a sign of Beijing being receptive to certain politicians that favor closer ties. NYT
• Turkey’s main opposition defeated Recep Tayyip Erdogan in the country’s local elections, claiming big wins in Istanbul and Ankara as voters pushed back amid rampant inflation. It won’t lead to any reversal in the country’s pivot to a restrictive monetary policy. BBG
• Tens of thousands of people demonstrated in Jerusalem on Sunday against Benjamin Netanyahu’s government and against exemptions granted to ultra-Orthodox Jewish men from military service, in scenes reminiscent of mass street protests last year. Protest groups, including some that led the mass demonstrations that rocked Israel in 2023, organized the rally outside parliament, the Knesset, calling for a new election to replace the government. RTRS
• Venezuela likely won’t see the US fully reimpose energy sanctions as Washington fears doing so could drive gas prices higher during an election year (one scenario under discussion would permit int’l buyers to continue purchasing Venezuelan oil, but not with US dollars). WaPo
• US PCE for Feb was largely inline with expectations. The headline number came in at +0.3% M/M (vs. the Street +0.4%) and +2.5% Y/Y (vs. the Street +2.5% and vs. +2.4% in Jan).  Powell spoke Friday afternoon (after the Feb PCE, personal spending, and personal income data hit), and his tone was largely consistent with the recent post-meeting press conference. NYT
• AT&T fell premarket after saying personal data from about 7.6 million current account holders and 65.4 million former customers was leaked onto the dark web. BBG
• MSFT & Open AI are apparently planning a massive ~$100B supercomputer project that would contain millions of specialized server chips to power OpenAI’s services and software. The Information
• Info Tech and Communication Services were the most net sold sectors on our US Prime book last week, driven almost entirely by short sales. The group collectively made up ~75% of last week’s notional net selling in all US Single Stocks. TMT stocks collectively now make up 29.1% of total US single stock Net exposure (vs. YTD high of 32.5% seen in mid-February), which is in the 2nd percentile vs. the past year and in the 13th percentile vs. the past 5 years.

US Event Calendar

• 09:45: March S&P Global US Manufacturing PM, est. 52.5, prior 52.5
• 10:00: March ISM Employment, prior 45.9
  • March ISM New Orders, est. 49.8, prior 49.2
  • March ISM Prices Paid, est. 52.9, prior 52.5
  • March ISM Manufacturing, est. 48.3, prior 47.8
• 10:00: Feb. Construction Spending MoM, est. 0.7%, prior -0.2%

Central Bank Speakers

• 18:50: Fed’s Cook Gives Acceptance Remarks for Award

US Transportation Secretary Pete Buttigieg told CBS’s Face the Nation on Sunday that there is no timeline on when salvage crews in Baltimore, Maryland, will clear the critical shipping channel blocked by the wreckage of the collapsed Francis Scott Key Bridge. He said it’s important “to our national supply chains to get that port back up and running as quickly as possible.”

In the meantime, Bloomberg shipping data shows 29 bulk cargo, container, and vehicle carriers were anchored outside ten major US ports up and down the East Coast on Saturday, compared with an average of 18. Given that there is yet to be a timeline for when the Port of Baltimore will reopen, companies are scrambling to divert cargo to other ports. 

On Monday morning, Port of Virginia, just south of Baltimore and at the mouth of the Chesapeake Bay near Norfolk, will open one hour early (0500 ET) to ramp up more trucking capacity as diverted cargo from Baltimore is offloaded. Bloomberg noted that a major railroad had expanded its services. 

Sanne Manders, president of international operations at digital freight platform Flexport, said other East Coast ports “can easily absorb the immediate aftermath on containerized trade.” 

Manders said that even though the port will reopen once salvage crews clear the shipping lane of debris, there will be “severe” consequences for the Port of Baltimore because the bridge once served as a critical “feeder into the port.” 

“The longer-term aftermath will probably be more severe, because even if you take away the debris from the port, that is an extremely important bridge as a feeder into the port, and traffic will have to reroute a long, long way.”

According to an analysis from the International Monetary Fund’s PortWatch platform, Norfolk, New York, and Charleston, South Carolina, are the ports most likely to absorb cargo. 

While East Coast ports will easily absorb diverted cargo from Baltimore, Governor Wes Moore warned the port closure will have severe ripple effects across the city, surrounding counties, the state, Mid-Atlantic, and even the eastern half of the US: 

“This port is one of the busiest inside the country, so this will impact the farmer in Kentucky, and the auto dealer in Ohio and the restaurant owner in Tennessee.” 

Last week, credit ratings agency Moody’s warned that the prolonged closure of the port would ripple through the local economy and could spark negative credit risk events for the city and state:  

The bridge collapse threatens to disrupt aspects of the State of Maryland (Aaa stable) and City of Baltimore (Aa2 stable) economies. The suspension of shipping traffic to the Port of Baltimore will likely divert cargo to other East Coast ports, which may affect jobs and tax revenue. The accident also has the potential to hurt the transportation and warehousing sector, though that accounts for a small share of state GDP.

More from Moody’s about the credit fallout that could soon hit Baltimore: 

In recent years, the state and Baltimore County (Aaa stable) have provided incentives and worked with developers to facilitate the redevelopment of Sparrows Point, a more than 3,000-acre contaminated industrial site once home to a Bethlehem Steel plant. Over the last nine years, Sparrows Point has seen almost $2 billion of private investment resulting in the development of 14 million square feet of warehousing and distribution facilities. With the Key Bridge providing the only direct access route between Sparrows Point and Baltimore/Washington International Thurgood Marshall Airport, further development at Sparrows Point could be delayed.

The one question that baffles us is why Baltimore didn’t install barriers or pilings around critical bridge supports to prevent ship strikes during major port expansions over a decade ago. Someone needs to be held accountable. Were woke officials focused on defunding the police, social justice, and DEI instead of critical infrastructure? 

Authored by Mike Shedlock via mishtalk.com,

The BEA reports real income is down, but personal spending jumped anyway. Inflation data is mostly as expected, but much higher than the Fed would like to see.

Personal Income and Outlays, February 2024

Nothing about the BEA’s Personal Income and Outlays report for February 2024 suggests the Fed should cut interest rates at its next meeting.

• Personal income increased $66.5 billion (0.3 percent at a monthly rate) in February.
• Disposable personal income (DPI), personal income less personal current taxes, increased $50.3 billion (0.2 percent)
• Personal consumption expenditures (PCE) increased $145.5 billion (0.8 percent).
• The PCE price index increased 0.3 percent. Excluding food and energy, the PCE price index increased 0.3 percent.
• Real DPI decreased 0.1 percent in February.
• Real PCE increased 0.4 percent; goods increased 0.1 percent and services increased 0.6 percent.

The Fed wants inflation at 2.0 percent. 0.3 percent per month times 12 months won’t come close to getting there.

You can twist the analysis however you want but you cannot twist the math.

Real Income and Spending Percent Change

Nominal spending was up 0.8 percent and real spending was up 0.4 percent. This suggests PCE inflation was on the high side of the range.

Rounded to a single decimal point, the reported 0.3 PCE price index month-over-month can be in the range of 0.25 to 0.34.

The PCE price index for January was 121.906. For February, it was 122.312. That’s a monthly increase of 0.333 percent, on the high end of the range. Multiply that by 12 and you are close to 4.0 percent price inflation annually.

This does not support Fed interest rate cuts.

Apartment List Reports Rent Prices Increase for the Second Month

Yesterday, I noted Apartment List Reports Rent Prices Increase for the Second Month

Also note Case-Shiller National Home Price Index Hits New Record High

Case-Shiller updated is home price data for January this week. Here are the key charts and a discussion of why it’s hard to tell if prices are rising or falling.

The Fed wants to cut in June, and that’s what the market expects (thanks to Fed jawboning), so most likely the Fed will cut unless the data is very hot.

Like Pavlov’s dogs, the market is salivating over rate cuts.

The virus pandemic, the rise of remote and hybrid work, and a surge in violent crime across progressive cities have significantly influenced the migration patterns of Americans over the past several years. 

A new report from real estate research firm ResiClub sheds more color on the migration trends, this time on a county-by-county basis. It reveals which counties in the US gained and or lost the most population between April 1, 2020, and July 1, 2023, citing data from the US Census Bureau. 

ResiClub founder Lance Lambert wrote on X that the “US Southeast, Mountain West, East/central Texas” had counties with some of the largest population gains over the period. Conversely, the counties based in California, the North and South Great Plains, parts of the Inland Midwest, and the inland Northeast had some of the most significant outflows. 

This map shows which counties have gained—and lost—population since 2020

🏡📊

ResiClub PRO | Access to the interactive map + searchable chart for +3,000 counties: https://t.co/BYLDGWN9KW pic.twitter.com/7UjxRdBfWp

— ResiClub (@ResidentialClub) March 30, 2024

Lambert posted a list of the top 40 counties with the largest population shifts over the period. 

Top Three Counties With Largest Population Increase: 

1. Collin, Texas
2. Wake County, North Carolina
3. Hillsborough, Florida

Top Three Counties With Largest Population Decrease: 

1. Bronx County, New York
2. Kings County, New York
3. Queens County, New York

We assume this data has not captured the illegal migration shifts as millions of illegal aliens invade the US via open southern borders and flood progressive cities.