Authored by Daniel Lacalle,

In recent months, many libertarians have criticised Donald Trump’s economic policies, arguing that he is not implementing drastic public spending cuts like Javier Milei has done in Argentina.

However, this comparison ignores key structural and contextual differences between the two countries and their governments. Below is a detailed explanation of why the situation in the United States under Trump is different from that of Argentina under Milei and why criticisms of Trump’s strategy are unfounded.

1. The Committed Budget: Biden’s Legacy

It is hard to understand why European libertarians fail to grasp such a basic concept as the “fiscal year”. The U.S. fiscal year begins on October 1, and the Biden administration took advantage of this to ramp up spending.

When Trump took office in January 2025, 97% of the federal budget for that year was already committed or spent. This was due to the Biden administration’s approval of several “Full Year Continuing Resolutions”, which left most funds and expenditures locked in for fiscal year 2025. Thus, Trump had no room to make immediate and drastic cuts, as most of the budget was untouchable until the next fiscal cycle.

Despite this, in 2025, discretionary spending reductions equivalent to $541 billion were carried out, and the accumulated deficit between April and May 2025 was 97% lower than in the same period of 2024.

2. Mandatory and Discretionary Spending

Mandatory spending (which includes programs like Social Security and Medicare) had already been increased by the Biden administration, and this increase took effect between February and December 2025. The U.S. fiscal year starts in October, and Biden implemented most of these increases through Continuing Resolutions (CRs) and the extension of existing programs, consolidating and, in many cases, increasing federal spending in key areas.

These resolutions included over $100 billion in funds for federal disaster assistance programmes, $29 billion for FEMA’s Disaster Relief Fund, and $10 billion in economic assistance for agricultural producers.

At the end of 2024, Biden approved a $54 billion (8%) increase in major mandatory spending programmes such as Social Security, Medicare, and Medicaid, as well as the extension of Obamacare, all applicable to 2025.

The Environmental Protection Agency (EPA) budget grew by $21 billion (700%), and the Trump administration was only able to act on $14 billion that was discretionary.

It is essential to remember that Biden did all this without a new budget law, simply by maintaining and extending existing allocations.

Biden’s proposed 2025 budget included additional increases, but these were blocked because they did not receive congressional approval.

Trump needs congressional approval to reverse these increases and reduce spending. That is what the “Big Beautiful Bill” includes. On the other hand, discretionary spending, especially in defence, was also committed, further limiting the new government’s immediate room for action.

The Big Beautiful Bill includes the first reduction in mandatory spending in the last sixty years—$1.6 trillion—and $2.4 trillion in discretionary spending.

3. Initial Fiscal Results

Despite these restrictions, the Trump administration achieved certain advances: in April, the second-largest fiscal surplus in history was recorded, and although a deficit reappeared in May, the deficit between March and May has been slashed compared to 2024. This indicates that measures were already being taken to improve the fiscal situation, mainly through higher revenues from trade agreements and private sector growth.

4. The “Big Beautiful Bill” and Deficit Reduction

It is astonishing that some libertarians and Austrians criticise the Big Beautiful Bill by buying into the Keynesian narrative that there will be no improvement in revenues, growth, employment, or investment from deregulation, trade agreements, and tax cuts.

That some libertarians deny the Laffer curve and the boost from deregulation surprises me. The Big Beautiful Bill incorporates $7 trillion in committed investments from trade negotiations, which also attract $4 trillion in tax revenues over the legislative period and a stimulus effect on the economy that results in an increase in tax revenues in the baseline scenario of $1.2 trillion.

Contrary to what some critics claim, the “Big Beautiful Bill” will not increase the deficit but will significantly reduce it.

A reduction of $1.6 trillion in mandatory spending and $2.4 trillion in discretionary spending is expected between 2026 and 2027. Additionally, an increase in tax revenues is anticipated thanks to deregulation, tax cuts, and new trade agreements, which will strengthen economic growth and employment.

We liberals, libertarians, and Austrians should be less critical of the greatest effort in reducing the State, liberalisation, deregulation, spending cuts, and tax reduction since 1990, but above all, some should not buy into the narrative that denies the positive effect on revenues and growth from deregulation, tax cuts, and trade negotiations.

5. Comparison with Milei: Similarities and Differences

Milei was able to implement immediate cuts because he inherited an open budget and extremely high inflation, which allowed him to reduce public spending in real terms by not adjusting it for inflation. Argentina’s budget does not include the provisions that the Biden administration incorporated, so President Milei was able to carry out a 30% reduction in public spending immediately and with unquestionable success, especially by eliminating subsidies, public works, and non-automatic transfers.

In contrast, Trump inherited a budget that was already committed and much lower inflation (less than 2.5%), limiting the impact of not adjusting spending for inflation.

If we compare both administrations, a very similar effort has been made. Trump has reduced public spending by 5% in the first quarter, and savings exceed $540 billion. By the end of his term, President Trump will have carried out a reduction in public spending equivalent to Milei’s.

Both leaders have promoted policies of tax reduction, deregulation, and the promotion of investment and employment. However, Trump’s tools and room for manoeuvre have been conditioned by the U.S. institutional structure and the decisions of the previous administration.

6. Conclusion

The policies of Trump and Milei share the goal of reducing public spending, fostering growth, and improving employment, but the starting circumstances are radically different. Criticising Trump for not applying an immediate “chainsaw” ignores the budgetary and legal constraints he faces in the United States. What matters is recognising that, within his constraints, Trump is implementing historic cuts and pro-growth policies that will positively impact the U.S. economy in the medium term.

My messages to those who attack the Trump administration for not being liberal enough are as follows:

• Name a single U.S. administration that has successfully implemented a comparable approach to deregulation, tax cuts, and spending reduction while also passing a significant reduction in mandatory spending through both Congress and the Senate.

• Buying into the Keynesian estimates of fiscal impact is curious. Denying the positive impact of reducing imports, increasing exports, and collecting more from trade agreements is surprising. Denying the economic and fiscal boost from deregulation and tax cuts is unforgivable.

On Saturday evening, air raid sirens sounded across the Dead Sea region and parts of the West Bank following the launch of a ballistic missile from Yemen toward Israel. The launch, attributed to Iran-backed Houthi forces, marks an alarming expansion of their missile capabilities beyond the Red Sea maritime chokepoint. 

Hours later, on Sunday morning, the UK Maritime Trade Operations (UKMTO) received a report that a merchant vessel transiting 51 nautical miles southwest of Al Hudaydah, Yemen, came under attack by multiple boats armed with small arms and rocket-propelled grenades. The vessel’s onboard security team returned fire. The incident remains ongoing.

UKTMO wrote:

UKMTO has received a report of an incident 51NM southwest of Al Hudaydah, Yemen. The vessel has been engaged by multiple small vessels who have opened fire with small arms and self-propelled grenades. Armed Security Team have returned fire and situation is ongoing. Authorities are investigating. Vessels are advised to transit with caution and report any suspicious activity to UKMTO.

The missile launch and maritime attack appear to be coordinated escalatory actions by the Iranian proxy group across multiple domains—air and maritime.

An update on Iran-Israel-U.S. tensions: The situation has calmed since the U.S. stealth bomber airstrikes on three Iranian nuclear facilities. However, President Trump stated on Friday that Tehran has yet to agree to nuclear inspections or cease uranium enrichment. 

Trump told reporters on board Air Force One that he believed Tehran’s nuclear program had been “set back permanently,” although he warned Iran could restart at a different location. 

Looking ahead, Israeli Prime Minister Benjamin Netanyahu is scheduled to visit the White House on Monday, where a potential ceasefire deal could materialize to end the 21-month war in Gaza. Trump has previously announced a “final proposal” for a 60-day ceasefire. 

Via Middle East Eye

Three opposition mayors have been arrested in Turkey in what the Republican People’s Party (CHP) have a branded a “political operation”. Adana Mayor Zeydan Karalar, Antalya Mayor Muhittin Bocek and Adiyaman Mayor Abdurrahman Tutdere were all arrested on Saturday as part of an investigation into corruption allegations that have already seen the imprisonment of Istanbul Mayor Ekrem Imamoglu.

It follows the arrest of more than 120 people earlier this week as part of an investigation into alleged corruption in the opposition stronghold of Izmir, the country’s third-largest city.

The CHP, the largest opposition party in Turkey, has accused the ruling Justice and Development Party (AKP) and President Recep Tayyip Erdogan of targeting them after widespread success in the 2024 local elections and polling suggesting Imamoglu could unseat the president in a future election.

Mansur Yavas, CHP mayor of the capital Ankara, criticised the arrests on X, saying his party would not bow to “unlawfulness”.

“In a system where the law is bent and twisted according to politics, where justice is applied for one segment and ignored for another, no one should expect us to trust the rule of law or believe in justice,” he wrote. 

According to the state-run Anadolu Agency, the mayors of Adana and Adiyaman were linked to a case involving alleged tender-rigging and corruption.

Police also arrested Ahmet Sahin, deputy mayor of Istanbul’s Buyukcekmece district. The mayor of Antalya was detained in a separate investigation into corruption allegations, while police also arrested his son.

The left-wing Peoples’ Equality and Democracy Party (DEM Party) also condemned the arrests on social media.

“This persecution of elected officials must stop,” wrote Tulay Hatimogullari, co-chair of the party, on X.

“Failure to recognise the will of the people is causing deep divisions within society –  these operations are not a solution, but rather block the path to a democratic Turkiye.”

Typically the interior ministry only has the power to replace elected mayors if they are suspected of terrorism offences.

Under the municipal law, if a mayor is suspended over corruption investigations a deputy mayor is selected by the city council and since the CHP holds a majority in the councils of all three cities they will not lose control.

Turkey detains three more mayors in latest opposition arrests
➡️ https://t.co/AgZ8fi8FYW pic.twitter.com/SFStxj98AC

— FRANCE 24 (@FRANCE24) July 5, 2025

On Monday, an Ankara court began examining a case involving allegations of vote-buying in the party’s 2023 primaries.

The move could lead to the annulment of the election of its leader Ozgur Ozel, who has become well-known for organising protests against the imprisonment of Imamoglu.

The White House rhetoric on Ukraine could be slowly shifting, after President Trump said he was “very unhappy” with a Thursday phone call with Russian President Vladimir Putin.

After a single night’s record drone attack of some 500 UAVs sent on Ukraine, Trump said “It just seems like he wants to go all the way and just keep killing people. It’s not good. I wasn’t happy with it” – in reference to Putin.

But it should be remembered that the White House just days prior halted some shipments of defense aid, which speaks louder than words. European allies are predictably upset and Kiev is now dealing very carefully with Washington, and handling Trump with kid gloves, given it is in a precarious situation on the battlefield.

Ukrainian President Volodymyr Zelensky, announced Saturday that his latest conversation with Trump this week was the best and “most productive” he has ever had.

“Regarding the conversation with the president of the United States, which took place a day earlier, it was probably the best conversation we have had during this whole time, the most productive,” Zelenskiy said in his nightly video address.

“We discussed air defense issues and I’m grateful for the willingness to help. The Patriot system is precisely the key to protection against ballistic threats,” he added.

Zelensky has also been asking Washington to slap more sanctions on Moscow, something Trump has so far resisted in order to give better space for peace negotiations to take off.

Asked by reporters over whether Zelensky’s request for more Patriot missiles would be honored, Trump replied, “They’re going to need them for defense… They’re going to need something because they’re being hit pretty hard.”

Trump had further said of the Zelensky call, which happened Friday, “We talked about different things… I think it was a very, very strategic call.”

This suggests that some new decision-making could be afoot regarding supplying Ukraine. There have been recent reports, however, that Trump is prioritizing defense of Israel, even diverting arms and ammo away from eastern Europe for that purpose. Trump has been expressing deep frustration at lack of momentum in US-backed peace efforts, for which he’s criticized both warring sides.

With deadly Texas flooding dominating headlines this weekend, we now shift focus to Tropical Storm Chantal, which made landfall near Myrtle Beach, South Carolina, early Sunday. This marks the first tropical storm to make landfall in the 2025 Atlantic hurricane season—and the earliest to do so since 2022.

Chantal is the third tropical storm of this year’s hurricane season, following Andrea and Barry, both of which formed in June. The new storm appeared on our radar Friday, with spaghetti models showing a potential path up the U.S. East Coast, through parts of the Mid-Atlantic, and possibly over southern New Jersey and New York City.

Updated spaghetti models posted by meteorologist Ben Noll on X show a strong level of confidence in Chantal’s track into the Mid-Atlantic and Northeast, where severe weather could be seen next from D.C. to New York and Boston.

Tropical Storm Chantal made landfall in South Carolina early Sunday, the earliest U.S. landfall since 2022.

Chantal will drag deep tropical moisture across North Carolina on Sunday and the Mid-Atlantic and Northeast on Monday and Tuesday, bringing a risk for flash-flooding. pic.twitter.com/q5ASjIJR2r

— Ben Noll (@BenNollWeather) July 6, 2025

“In addition to being the first of this season, Chantal’s landfall was the earliest in the season since 2022 in the United States,” Knoll noted in a weather post featured in the Washignton Post.

Copious amounts of tropical moisture from Chantal will stream into the Mid-Atlantic and Northeast on Monday — with precipitable water values of 2 to 3 inches — bringing drenching downpours.

There could be some sneaky flash flooding. pic.twitter.com/qsyAWP6k3F

— Ben Noll (@BenNollWeather) July 6, 2025

Additional forecast models show a high level of confidence that Chantal will track up the East Coast before spinning out into the Atlantic. Models are subject to change. 

The months of August and September tend to be the most active for hurricane activity. 

If you have travel plans along the East Coast this week, keep a close eye on Chantal.

Via The Cradle

Britain reestablished full diplomatic relations with Syria on Sunday as part of the visit of UK Foreign Secretary David Lammy to Damascus to meet the country’s new de facto leader, Ahmad al-Sharaa (Jolani).

In a video message on X, Lammy claimed the UK had an interest in Syria’s recovery after 14 years of war. “It matters that it’s stable, because if it’s not, the terrorism that can happen here washes up on our own streets back at home,” he said.

He also stressed the importance of addressing illegal immigration, noting that “it’s hugely important we continue to support progress here.”

“This is a country that is ancient, made up of many different people. The future has to be an inclusive one. It has to be a peaceful one. And I hope for prosperity for all of the Syrian people,” he said.

Britain played a key role in sparking the war in Syria in 2011, which killed hundreds of thousands, and in bringing the current government, led by Sharaa, to power in December 2024.

Sharaa previously fought for the Islamic State of Iraq (the precursor to ISIS) after the 2003 US invasion. He was detained in Iraq in 2006 and released by US officials in 2008.

After his release, Sharaa was appointed head of Islamic State operations in Mosul Province, dispatching suicide car bombers to kill Shia Muslims and Christians. In August 2011, he was dispatched to Syria by Abu Bakr al-Baghdadi to establish the Nusra Front.

That same year, UK intelligence facilitated the travel of British extremists of Libyan and West and South Asian backgrounds to Syria to fight against the government of Bashar al-Assad. Many joined the Al-Qaeda-affiliated Nusra Front and ISIS.

The same year, former UK Prime Minister Tony Blair’s chief of staff, Jonathan Powell, founded the NGO Inter Mediate, a Foreign Office-funded project aimed at establishing secret channels with insurgent groups. 

He boasted that his group worked closely with the UK foreign office and UK intelligence. Powell personally met multiple times with Sharaa in Idlib Governorate in an effort to rebrand his terrorist image and groom him as Syria’s next leader.

The Nusra Front was later rebranded as Hayat Tahrir al-Sham (HTS). Sharaa and HTS captured Damascus in December, ousting Assad.

Syrian analyst Malek Hafez told the Syrian Observer that Powell, who became UK National Security Advisor in November, has a team running a media office inside the presidential palace, “reportedly run by two women – one British, the other of Lebanese-British heritage.”

As Hafez concludes, “The rise of Ahmad al-Sharaa was not spontaneous – it was carefully engineered through a long-term, western-backed strategy, in which Britain played a disproportionately influential role among western powers.”

Here is the British Foreign Secretary David Lammy meeting with the head and founder of the (still) proscribed organisation Hayʾat Tahrīr al‑Shām (HTS) in Damascus today.

I trust Lammy will be arrested at Heathrow on his return to London, right @TerrorismPolice @metpoliceuk? pic.twitter.com/5nspEUY6JO

— Naila (@BrownNaila) July 5, 2025

Since Assad’s fall, Syria has moved toward becoming an extremist Islamic state based on the violent ideology of the medieval Islamic scholar Ibn Taymiyyah.

In March, extremist Islamist gunmen affiliated with Syria’s Ministry of Defense and General Security massacred at least 1,500 Alawite civilians, often referring to them as pigs and dogs before killing them.

Authored by James Rickards via DailyReckoning.com,

Readers know at least two things about artificial intelligence (AI).

The first is that an AI frenzy has been driving the stock market higher for the past three years even with occasional drawdowns along the way.

The second is that AI is a revolutionary technology that will change the world and potentially eliminate numerous jobs, including jobs requiring training and technical skills.

Both points are correct with numerous caveats. AI has been driving the stock market to record highs, but the market has the look and feel of a super-bubble. The crash could come anytime and bring the market down by 50% or more.

That’s not a reason to short the major stock indices today. The bubble can last longer than anyone expects. If you short the indices, you can lose a lot of money being wrong. But it is advisable to lighten up on equity allocations and increase your allocation to cash in order to avoid the worst damage when the crash does come.

On the second point, AI will make some jobs obsolete or easily replaceable. Of course, as with any new technology, it will create new jobs requiring different skills. Teachers will not become obsolete. They’ll shift from teaching the basics of math and reading, which AI does quite well, to teaching critical thinking and reasoning, which computers do poorly or not at all. Changes will be pervasive, but they will still be changes and not chaos.

The Limitations

Artificial Intelligence is a powerful force, but there’s much less there than meets the eye. AI may be confronting material constraints in terms of processing power, training sets and electricity generation. Semiconductor chips keep getting faster and new ones are on the way. But these chips consume enormous amounts of energy, especially when installed in huge arrays in new AI data centers. Advocates are turning to nuclear power plants, including small modular reactors to supply the energy needs of AI. This demand is non-linear, which means that exponentially larger energy sources are needed to make small advances in processing output. AI is fast approaching practical limits on its ability to achieve greater performance.

This near insatiable demand for energy means that the AI race is really an energy race. This could make the U.S. and Russia the two dominant players (sound familiar?) as China depends on Russia for energy and Europe depends on the U.S. and Russia. Sanctions on Russian energy exports can actually help Russia in the AI race because natural gas can be stored and used in Russia to support AI and cryptocurrency mining. It’s the law of unintended consequences applied to the short-sighted Europeans and the resource-poor Chinese.

AI Lacks Common Sense

Another limitation on AI, which is not well known, is the Law of Conservation of Information in Search. This law is backed up by rigorous mathematical proofs. What it says is that AI cannot find any new information. It can find things faster and it can make connections that humans might find almost impossible to make. That’s valuable. But AI cannot find anything new. It can only seek out and find information that is already there for the taking. New knowledge comes from humans in the form of creativity, art, writing and original work. Computers cannot perform genuinely creative tasks. That should give humans some comfort that they will never be obsolete.

A further problem in AI is dilution and degradation of training sets as more training set content consists of AI output from prior processing. AI is prone to errors, hallucinations (better called confabulations) and inferences that have no basis in fact. That’s bad enough. But when that output enters the training set (basically every page in the internet), the quality of the training set degrades, and future output degrades in sync. There’s no good solution to this except careful curation. If you have to be a subject matter expert to curate training sets and then evaluate output, this greatly diminishes the value-added role of AI.

Computers also lack empathy, sympathy and common sense. They process but they do not really think like humans. In fact, AI does not think at all; it’s just math. In one recent experiment, an AI computer was entered into a competition with a group of 3- to-7-year-olds. The challenge was to draw a circle with the tools at hand. Those tools were a ruler, a teapot and a third irrelevant object such as a stove. The computer reasoned that a ruler was a drafting instrument like a compass and tried to draw a circle with a ruler. It failed. The children saw that the bottom of a teapot was a circle and simply traced the teapot to draw perfect circles. The AI system used associative logic. The children used common sense. The children won. That result will not vary in future contests because common sense (technically abductive logic) cannot be programmed.

High-flying AI companies are quickly finding that their systems can be outperformed by newer systems that simply use big ticket AI output as a baseline training set. This is a shortcut to high performance at a small fraction of the cost. The establishment AI companies like Microsoft and Google call this theft of IP, but it’s no worse than those giants using existing IP (including my books, by the way) without paying royalties. It may be a form of piracy, but it’s easy to do and almost impossible to stop. This does not mean the end of AI. It means the end of sky-high profit projections for AI. The return on the hundreds of billions of dollars being spent by the AI giants may be meager.

Sam Altman: Innovator or Salesman?

The best-known figure in the world of AI is Sam Altman. He’s the head of OpenAI, which launched the ChatGPT app a few years ago. AI began in the 1950s, seemed to hit a wall from a development perspective in the 1980s (a period known as the AI Winter), was largely dormant in the 1990s and early 2000s, then suddenly came alive again in the past ten years. ChatGPT was the most downloaded app in history over its first few months and has hundreds of millions of users today.

Altman was pushed out by the board of OpenAI last year because the company was intended as a non-profit entity that was developing AI for the good of mankind. Altman wanted to turn it into a for-profit entity as a prelude to a multi-hundred-billion-dollar IPO. When the top engineers threatened to quit and follow Altman to a new venture, the board quickly reversed course and brought Altman back into the company, although the exact legal structure remains under discussion.

Meanwhile, Altman has charged full speed ahead with his claims about superintelligence (also known as advanced general intelligence (AGI) with the key word being “general,” which means the system can think like humans, only better). One way to understand superintelligence is the metaphor that humans will be to the computer as apes are to humans. We’ll be considered smart, but not smarter than our machine masters. Altman said that “in some ways ChatGPT is already more powerful than any human who ever lived.” He also said he expects AI machines “to do real cognitive work” by 2025 and will create “novel insights” by 2026.

This is all nonsense for several reasons. The first as noted above is that training sets (the materials studied by large language models) are becoming polluted with the output from prior AI models so that the machines are getting dumber not smarter. The second is the Law of Conservation of Information in Search I also described above. This law (supported by applied mathematics) says that computers may be able to find information faster than humans, but they cannot find any information that does not already exist. In other words, the machines are not really thinking and are not really creative. They just connect dots faster than we do.

A new paper from Apple concludes, “Through extensive experimentation across diverse puzzles, we show that frontier LRMs [Large Reasoning Models] face a complete accuracy collapse beyond certain complexities. Moreover, they exhibit a counter-intuitive scaling limit: their reasoning effort increases with problem complexity up to a point, then declines despite having an adequate token budget.” This and other evidence point to AI reaching limits of logic that brute force computing power cannot overcome.

Finally, no developer has ever been able to code abductive logic; really common sense or gut instinct. That’s one of the most powerful reasoning tools humans possess. In short, superintelligence will never arrive. More and more, Altman looks like just another Silicon Valley salesman pitching the next big thing with not much behind it.

Update (Sunday):

A new filing with the Federal Election Commission (FEC) confirms that Elon Musk’s America Party (AMEP) is now official, as the billionaire sets out to challenge the entrenched “uniparty” duopoly in Washington.

Musk has voiced deep frustration with GOP lawmakers over their failure to codify DOGE cuts and President Trump’s “Big Beautiful Bill,” which was signed into law on Independence Day.

FEC Filing:

Filing #1898441 states that AMEP will be headquartered at 1 Rocket Road, Hawthorne, CA 78725—the same address as Musk’s rocket company, SpaceX, according to public records.

Leadership:

AMEP’s Custodian of Records and Treasurer is listed as Vaibhav Taneja, who also currently serves as CFO of Tesla, per publicly available filings.

BREAKING – FEC paperwork has been filed to create the “America Party,” but the listed treasurer is an Indian-born man named Vaibhav Taneja. pic.twitter.com/re9bmLdnxv

— Right Angle News Network (@Rightanglenews) July 6, 2025

The Filing:

.    .     . 

One day after his latest poll asking his followers on X whether the USA needs a new political party, Elon Musk announced on Saturday that the “America party has formed.”

“By a factor of 2 to 1, you want a new political party and you shall have it!” Musk wrote. 

“Today, the America Party is formed to give you back your freedom.”

By a factor of 2 to 1, you want a new political party and you shall have it!

When it comes to bankrupting our country with waste & graft, we live in a one-party system, not a democracy.

Today, the America Party is formed to give you back your freedom. https://t.co/9K8AD04QQN

— Elon Musk (@elonmusk) July 5, 2025

The announcement comes after 1,248,856 people voted ‘yes’ to whether he should “create the America Party.”

Independence Day is the perfect time to ask if you want independence from the two-party (some would say uniparty) system!

Should we create the America Party?

— Elon Musk (@elonmusk) July 4, 2025

The announcement comes one day after President Donald Trump signed his signature tax and spending bill, which Musk has vehemently opposed for weeks, and which resulted in a very public falling out with Trump – whose campaign Musk spent hundreds of millions of dollars promoting. 

Musk also led the Department of Government Efficiency (DOGE), which found billions of dollars in waste, fraud and abuse – virtually none of which was included in Trump’s so-called “Big Beautiful Bill.”

While the Trump-Musk spat has simmered in recent weeks, Trump earlier this week threatened to cut off billions of dollars in subsidies to Musk’s companies. 

Meanwhile, Musk foe Steve Bannon tore into the plan for a third political party – saying on his “War Room” podcast on Friday: “The foul, the buffoon. Elmo the Mook, formerly known as Elon Musk, Elmo the Mook. He’s today, in another smear, and this — only a foreigner could do this — think about it, he’s got up on, he’s got up on Twitter right now, a poll about starting an America Party, a non-American starting an America Party.” 

“No, brother, you’re not an American. You’re a South African and if we take enough time and prove the facts of that, you should be deported because it’s a crime of what you did — among many,” Bannon added. 

BANNON: Elmo the Mook (formerly Elon Musk) is at it again today.

The gall for him, as a foreigner, to run a Twitter poll about starting an American political party.

Newsflash: You’re not American. You’re a South African billionaire meddling in our politics. pic.twitter.com/eD6FT9AFuG

— Bannon’s WarRoom (@Bannons_WarRoom) July 4, 2025

Musk, meanwhile, wrote on Friday that “The fat, drunken slob called Bannon will go back to prison and this time for a long time. He has a lifetime of crime to pay for.”

The fat, drunken slob called Bannon will go back to prison and this time for a long time. He has a lifetime of crime to pay for.

— Elon Musk (@elonmusk) July 4, 2025

Tesla’s sales in Germany dropped 60% in June to 1,860 vehicles, according to the KBA. For the first half of 2025, sales fell 58.2% year-over-year to 8,890 units, despite overall growth in battery EV sales., according to Reuters.

Tesla has also now seen six straight months of declining sales in France, Sweden, Denmark, and Italy. Chinese EV maker BYD saw its German sales nearly quadruple in June to 1,675 and surged over fivefold to 6,323 year-to-date.Recall, Tesla’s company-wide Q2 delivery numbers came in at 384,122 vehicles last week, just below the estimate of 389,407. 

While estimates had been lowered multiple times, the number was still better than whisper numbers as low as 350k or 360k that were starting to make their way around the street.

Production beat expectations. Tesla built 410,244 vehicles, compared to the forecast of 400,083. Model 3 and Model Y deliveries totaled 373,728, slightly under the estimate of 377,295. The “Other Models” category — including the Model S, X, and Cybertruck — showed Tesla delivered 10,394 vehicles, below the expected 14,644.

Production of these models also came in slightly under, at 13,409 compared to the estimate of 13,616.

Model 3 and Y production reached 396,835 units, higher than the expected 383,567, suggesting Tesla had ramped up output of its most popular models.

Deutsche Bank analysts noted late last week that the surprise upside came mainly from the U.S. (likely due to tax credit pull-forward) and stronger sales in parts of Asia, though China was weaker than expected.

Model 3/Y deliveries outperformed forecasts, while S/X/Cybertruck lagged. Energy storage deployment missed estimates. Deutsche Bank sees potential margin upside from the delivery beat but notes that full-year volume growth remains challenging due to policy headwinds and Model Q delays. Elon Musk’s renewed focus on U.S. and European sales could help in H2, the bank said.

As we noted last week, ahead of Tesla’s Q2 2025 delivery report, expectations were subdued amid signs of continued demand weakness and investor concerns over the company’s growth trajectory. Analysts widely anticipated another disappointing quarter, despite hopes pinned on the rollout of a refreshed Model Y and the company’s long-term robotaxi ambitions.

The Bloomberg consensus projected Tesla would report global deliveries of 395,328, representing an 11% year-over-year decline, though still higher than the 336,700 vehicles delivered in Q1. Production was expected to hit 443,321 units, up from 410,800 in the same period last year.

Authored by Charles Hugh Smith via OfTwoMinds blog,

Our status quo is so thoroughly corrupt that it’s no longer even seen as corruption, it’s just BAU–business as usual.

It’s a big ask, but let’s depoliticize the phrase “make America great again” and consider what this would actually entail, not as a lobbyists’ grab-bag of tax breaks for the wealthy and arcane giveaways in 500-page Congressional bills, but as a restoration of the fundamental foundations of greatness.

In the conventional contexts of the current era, this boils down to ideology and finance. If we dial back culture-war over-reach and free up “market forces,” for example, this will restore America’s greatness.

The problem with all this kind of thinking is it’s superficial and banal, for it ignores the real source of America’s decline: the moral rot that has eroded every institution and every nook and cranny of our society. Whenever I mention this moral rot, I get immediate push-back of this sort: corruption has always been around, so today is no different from previous eras.

While it’s self-evident that self-interest and greed manifest as corruption, it’s not true that the systemic corruption of the present is no different from previous eras–it’s worse, much worse because it’s now normalized, and so we accept the most outrageous forms of corruption as “normal.”

So private equity buys a company, loads it with debt, transfers all the borrowed cash to the private equity “owners,” and then leaves the company a sinking hulk that soon declares bankruptcy. Or when private equity snaps up hospitals and healthcare clinics and prices rise not for better service but to “reward the owners,” this plundering of “healthcare” is just good solid MBA-school maximization of shareholder value.

What few seem to notice is the barriers that limited the pillage and plundering of the private and public-sectors have all eroded or been hollowed out. The legal framework is now a mirror-image of the financial sector, a series of facades that mask the pillage and plundering: of course it’s profitable, but it’s also legal.

The social barriers have also been dismantled. There are no taboos left, as “anything goes” is the modern zeitgeist. The notion that corporations have a social responsibility to the community they’re embedded in is now a quaint whiff of nostalgia, along with the notion that corporations have an implicit responsibility to serve the larger national interests as well as “shareholder value.”

Every institution has been hollowed out by self-service. Is it any wonder than younger generations have near-zero trust in institutions, given that their PR veneer of “public service” is just a cover for milking the system for private gain?

If you read histories of capitalism–for example, Fernand Braudel’s three-volume Civilization and Capitalism, 15th-18th Century ( Volume 1, Volume 2, Volume 3) you discover that “capitalism” only functions as advertised if it is embedded in a moral order, something Adam Smith understood.

In early European capitalism, Christianity (Catholic and Protestant) provided this moral order. In China, Confucianism provided the moral foundation of the society and the economic – political structures.

Consider Xi Jinping’s campaign to unify Confucianism and Marxism. This is not an anachronism, it reflects Xi’s understanding that Marxism does not provide the moral foundation needed to limit the corruption undermining China. Only restoring a Confucian moral order can do that.

I explored this in some depth in this essay Pieces of the China Puzzle (April 27, 2024).

Here is an excerpt:

As the author noted, “his attempted synthesis of Marx and Confucius has prompted bafflement, even mockery, among observers outside and inside China.”

To me, there is nothing baffling in this synthesis; it not only makes perfect sense, it can be understood as essential in the broader context of China’s history and culture.

If we truly want to make America great again, as opposed to using the slogan as cover for more grift and graft, then we have to start by recognizing the moral sinkhole we’re in. Institutions, the government and corporations have all lost our trust because they’re all cesspools of self-serving corruption.

No, this is not “normal” or “the way it’s always been.” Those are the excuses we deploy to avoid facing the truth: our status quo is so thoroughly corrupt that it’s no longer even seen as corruption, it’s just BAU–business as usual.

There will be consequences, for a society that lacks a moral foundation is a society shorn of value, a society of fakery, PR and narrative control designed to mask maximizing my gain regardless of consequences pillage and plunder.

When a hard rain finally falls, it will surprise us, for in our grandiosity and hubris, we imagined we were gods, immune to the fatal consequences of our corruption.

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