A slowdown in economic activity, combined with growing tariff uncertainty, appears to be curbing consumer appetite for highly processed junk food. The latest trends show a declining demand for sweet snacks in North America as more shoppers shift their spending toward real food, such as meat, vegetables, and eggs. 

Mondelez International — the maker of Sour Patch Kids, Oreos, Ritz, Toblerone, Cadbury, and other highly processed food brands — reported slower-than-expected sales for the first quarter.

Organic revenue, which excludes currency fluctuations and one-time items, increased 3.1%, falling short of the Bloomberg consensus estimate of 3.5%. Notably, sales in North America declined during the quarter. 

On an earnings call, Mondelez CEO Dirk Van de Put told analysts: “I really do not expect to see a significant improvement in consumer confidence in the near term in the US.” 

“Two, three years ago consumers would easily pay above $4 for a pack of biscuits,” Van de Put said adding, “We’re now seeing that we need to be below $4 and ideally below $3.”

Mondelez noted that shoppers are beginning to prioritize real food — if that’s meat, vegetables, and eggs — over snacks, chips, and candy. Also, lower-income consumers are pivoting towards smaller packages, while higher-income consumers are searching for larger value bundles. 

Mondelez reiterated its full-year guidance and warned profit will slide 10% this year “due to unprecedented cocoa cost inflation.”

Weighing in on the North American junk food slowdown, Goldman analysts Leah Jordan and Eli Thompson offered clients their first take on Mondelez’s first-quarter results and its unchanged full-year outlook:

1. North America came in softer-than-expected on the back of retailer destocking and softer cracker demand as the consumer remains value-focused;

2. chocolate elasticity tracked in-line with expectations, although more pricing is still to come; and

3. MDLZ reiterated its FY25 guide in constant currency while potential upside is likely to be reinvested throughout the year to support potential growth in FY26

The key takeaway for the North American market:

• North America softer-than-expected: Organic net sales in North America came in softer-than-expected at -3.6% (vs GS/consensus of flat/+0.1%), largely due to retailer destocking (-250 bps), while segment profitability also missed. The destocking impact should be one time in nature, but we do not expect it to reverse as we have heard from retailers that this effort has been driven by efficiency gains. Additionally, MDLZ noted softer demand for crackers (vs cookies), although both categories are holding up relatively better than other parts of snacking, plus the company is holding share due to investments in price pack architecture and key activations. Additionally, management spoke to increasing promotional activity by peers in crackers, and we see greater private label competition in the category as well. Regarding consumer behavior, the company noted a shift to smaller pack sizes by the lower end and toward multi-packs for upper income cohorts, along with a shift in channels toward dollar stores, clubs, and value retailers.

Details about the cocoa market:

• Chocolate elasticity tracking in-line, although more pricing still to come: MDLZ indicated elasticity within chocolate tracked in-line with expectations at -0.5%, while it gained share in the category. However, more pricing will be implemented in the spring with management taking a wait and see approach while expressing confidence in its chocolate strategy with a range of price points. The company expects a top line acceleration throughout the year, supported by both pricing and volumes, with Easter strength noted for 2Q and pricing negotiations are now complete in Europe (vs a disruption last year). By region, management highlighted solid Easter chocolate demand for Europe/UK, Brazil, and Australia, with stable YTD elasticities noted for Europe and Emerging Markets. Notably, MDLZ indicated greater elasticity for chocolate in the U.S. vs ROW with volumes tracking down -5%, which is a negative read-through for HSY.

Notes on guidance:

• Reiterated FY25 guide with potential upside expected to be reinvested: MDLZ reiterated its FY25 guidance with an adj EPS decline of -10% (constant currency), noting potential upside would likely be reinvested (e.g., 1Q beat planned to be reinvested in marketing this year), while the tariff impact remains small. FY25 organic sales guidance was also reiterated at +5%, with sequential improvements supported by both volume and pricing. We also expect a gross margin improvement throughout the year tied to its pricing action. Regarding FY26, MDLZ expects EPS growth y/y, but management stopped short on the magnitude of potential ranges given cocoa uncertainty. For cocoa, the company still sees a supply/demand surplus with further demand destruction likely (as some will likely reformulate). Furthermore, the company sounded constructive on its position given lower cocoa butter prices y/y, its bigger input exposure.

Despite key downside risks, such as an economic slowdown, Goldman analysts remained “Buy” rated on Mondelez, with a 12-month price target of $71. 

Mondelez did not indicate that the slowdown in junk food demand was influenced by the “Make America Healthy Again” movement in any way (well at least not yet). 

Authored by Jeremy Portnoy via RealClearInvestigations,

Topline: The Houston Independent School District is facing a budget deficit that at one point reached $250 million, but that did not stop Superintendent Mike Miles from accepting a $126,730 bonus in April to supplement his $380,000 salary.

Key facts: Miles’ bonus was calculated after he received a 66.7 out of 100 on his first annual evaluation from the school board that measured student performance, “executive leadership” and “vision,” according to the Houston Chronicle. A perfect score would have netted Miles a $190,000 bonus.

The school district has struggled with funding for years, as have other large school districts in Texas. The state government has not increased public school funding since 2019 to keep pace with inflation, and yet some of Houston’s struggles come simply from overspending. Cumulative inflation from 2019 to 2024 in the U.S. was 22%, but Houston ISD increased its payroll by 29% in that timespan, according to OpenTheBooks’ database. 

Last year the school released an audit detailing “overtime abuse” that forced the district to pay $26 million in one year. Auditors also found an “overreliance on purchased services” and “overuse of consultants with several other costs to overall effectiveness.”

The district began the current school year with a $125 million deficit, but Miles asked the school board to approve an amendment that increased spending and ballooned the deficit to $250 million, forcing the district to dig into its reserves and one-time savings.

Next year the district projects a $33 million deficit after laying off 1,500 employees. Miles is also considering closing some school buildings to cut costs.

Search all federal, state and local government salaries and vendor spending with the AI search bot, Benjamin, at OpenTheBooks.com. 

Supporting quote: Miles told the school’s community advisory committee, “I assure you, that bonus and incentive was well deserved, and I know my value, and achievement results show that.”

Critical quote: The Houston Chronicle’s editorial board equated Miles’ 66.7 evaluation score to a “D,” claiming that “It’s a lousy grade. The kind you bury at the bottom of your backpack in hopes it disappears before somebody sees. That’s essentially what the district tried to do. Chronicle reporters had to file a public information request to get a copy of the evaluation.”

Summary: Houston is far from the only school district giving its superintendent a generous bonus, but a fiscal crisis — and a “D” grade — is not the time to do it. 

The #WasteOfTheDay is brought to you by the forensic auditors at OpenTheBooks.com

*  *  *

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It had already been a miserable month for oil, which has suffered its worst monthly performance since 2021 and also is on pace for its month of April on record… and then it got even worse when shortly before noon ET, when Reuters reported, citing multiple sources, that Saudi Arabian officials are briefing allies and industry experts to say the kingdom is unwilling to prop up the oil market with further supply cuts and can handle a prolonged period of low prices.

This shift in Saudi policy could suggest a move toward producing more and expanding its market share, a major change after five years spent balancing the market through deep output as a leader of the OPEC+ group of oil producers. Those cuts had supported prices, in turn bolstering the oil export revenue that many oil producers rely on, but many OPEC+ members – most notably Kazakhstan – took advantage of the production restraint and blew away through their export quotas, infuriating other cartel members.

Sure enough, Reuters notes that Riyadh has been angered by Kazakhstan and Iraq producing above their OPEC+ targets. And after pushing members to adhere to those targets and to compensate for oversupply in recent months, a frustrated Riyadh is changing tack, OPEC+ sources said.

Saudi Arabia pushed for a larger-than-planned OPEC+ output hike in May, a decision that helped send oil prices below $60 a barrel to a 4-year low.

And now that Kazahkstan blew it for all cartel members, everyone will share the pain equally, as lower prices are bad news for producers that rely on oil exports to fund their economies. Although producers like Saudi have a very low cost of production, they need higher oil prices to pay for government spending. When oil prices fall, many large oil-producing countries come under pressure to cut their budgets.

And just to confirm that they are not bluffing, the Saudis appear to be briefing allies and experts that they are ready to do just that. The last time they did just that was in March 2020, just before covid shut down the global economy and briefly sent oil prices negative, sparking budget crises across all OPEC members.

Saudi officials in recent weeks have told allies and market participants the kingdom can live with the fall in prices by raising borrowing and cutting costs, the five sources said.

“The Saudis are ready for lower prices and may need to pull back on some major projects,” one of the sources said. All sources declined to be named due to sensitivity of the issue.

The problem is that Saudi Arabia needs oil prices above $90 to balance its budget, higher than other large OPEC producers such as the United Arab Emirates, according to the International Monetary Fund (IMF). As a result, Riyadh may need to delay or cut back some projects due to the price drop, analysts have said.

OPEC+, which besides the Organization of the Petroleum Exporting Countries also includes allies such as Russia, may decide to speed up output hikes again in June, OPEC+ sources have said. OPEC+ is cutting output by over 5 million barrels or 5% of global supply, to which Saudi Arabia is contributing two-fifths.

Russia, the second largest exporter in OPEC+ behind Saudi Arabia, is aware of Riyadh’s plans for faster output increases, said two of the five sources who are familiar with the Russian thinking and conversations with Riyadh. Even so, Russia would prefer the group stick to slower output increases.

Saudi Arabia and Russia, the de facto leaders of OPEC+, make the biggest contributions to OPEC+ cuts. Russia’s budget balances at about $70 a barrel and the Kremlin’s spending is on the rise due to the Russian war in Ukraine.
Russia may see a further fall in revenue as prices for its discounted, sanctioned oil could fall below $50 a barrel as a result of OPEC+ output rises, one of the two sources said.

Theories on the apparent change in Saudi strategy range from punishing OPEC+ members exceeding their quotas to a move to fight for market share after ceding ground to non-OPEC+ producers such as the United States and Guyana. Higher output may also be a fillip to U.S. President Donald Trump, who has called for OPEC to boost output to help keep U.S. gasoline prices down.

Trump is due to visit Saudi Arabia in May and could offer Riyadh an arms package and a nuclear agreement. OPEC+ decided to triple its planned output increase to 411,000 bpd.

That still leaves OPEC+ holding back more than 5 million bpd, curbs the group aims to unwind by the end of 2026. 

“We would still call this a ‘managed’ unwind of cuts and not a fight for market share,” UBS analyst Giovanni Staunovo said.

“This confirms the market’s fears that Saudi Arabia’s accelerated unwinds were not temporary, but a long-term strategy shift,” said Rebecca Babin, a senior energy trader at CIBC Private Wealth Group. It raises the question of whether “Saudi is going to repeat the 2020 playbook to dramatically increase production.”

For now the market is voting “yes”, and the news sent WTI tumbling as much as 4%,or more than $2 to just under $58, the lowest price since early 2021 (and a level which was only briefly breached after Trump’s Liberation Day sent oil to $55 before rebounding rapidly).

OPEC+ rocked the crude market in early April, with a surprise decision to increase supply in May by 411,000 barrels a day, the equivalent of three monthly tranches from a previous plan. Morgan Stanley has said it expects a “meaningful surplus” to develop over time, while JPMorgan Chase & Co. warned the cartel may accelerate planned production increases at a meeting next week.

Beyond OPEC+, non-cartel nations are also expected to add supplies, including drillers in Canada and Guyana, feeding concerns about a global glut.

At the same time, hopes are fading that there will be quick breakthroughs in US-led trade negotiations, weighing on the outlook for energy demand. The US economy contracted for the first time since 2022 in the first quarter as a result of a surge in pre-tariff imports and softer consumer spending. In China, factory activity slipped into the worst contraction since December 2023, revealing early damage from the trade war.

Authored by Zachary Stieber via The Epoch Times (emphasis ours),

A federal appeals court on April 29 turned down the Trump administration’s bid to block restrictions on deporting Venezuelans from Colorado.

The government did not show that it is likely to be irreparably harmed if a lower court order remains in place, a unanimous three-judge panel of the U.S. Court of Appeals for the 10th Circuit ruled.

Under court precedent, a party seeking a stay pending appeal must show it will likely be irreparably harmed absent a stay.

U.S. District Judge Charlotte N. Sweeney recently issued a temporary restraining order requiring the Trump administration to give Venezuelans arrested for alleged links to the Tren de Aragua gang three weeks’ notice before deportation.

The order applies to all noncitizens in Colorado who were, are, or will be subject to President Donald Trump’s March invocation of the Alien Enemies Act. The president at the time said that Tren de Aragua had invaded the United States, and he directed officials to arrest and deport its members.

“All members of the class are in federal custody. And given the important unresolved issues under the Alien Enemies Act (AEA) and the ruling of the United States Supreme Court that no one in that proceeding be removed under the AEA until further order of that Court … there is no realistic possibility that the government could remove any member of the class from this country before final expiration of the TRO on May 6, 2025,” the 10th Circuit panel stated.

Lawyers for the government and the plaintiffs in the case did not respond to early morning requests for comment.

Four factors must be met to secure a stay pending appeal. The appeals court did not address the other three factors, which include presenting a strong showing that a party is likely to succeed in the case since the irreparable harm standard was not met, the judges said.

The panel consisted of U.S. Circuit Judges Harris L. Hartz, Gregory A. Phillips, and Joel M. Carson.

Government lawyers had said in filings that Sweeney lacked jurisdiction to halt deportations because the plaintiffs were not in custody at the time of the ruling. Immigration and Customs Enforcement had released the plaintiffs because it determined they were not subject to the Alien Enemies Act.

The lawyers also argued that the restraining order “irreparably harms the United States’ conduct of foreign policy” because it “usurps the President’s statutory and constitutional authority to address what he has identified as an invasion or predatory incursion.”

Attorneys representing the Venezuelans had said in response that the restraining order was proper because the government had been giving people arrested under the invocation just 24 hours’ notice of removal, which they said did not achieve due process.

Nvidia CEO Jensen Huang warned Wednesday at the Hill and Valley Forum in Washington, D.C., that the U.S. and China are in a fierce, long-term AI supremacy race, while touting AI’s potential to transform industries and drive a trade jobs boom.

“China is right behind us,” Huang told CNBC’s Squawk on the Street after his forum appearance. “We’re very, very close.” The billionaire tech founder, whose company dominates the AI chip market, framed the competition as enduring. “This is a long-term, an infinite race,” he said. “In the world of life, there’s no two-minute drill or end of the quarter.” Huang’s comments underscore the high stakes of AI development as both nations channel vast resources into the transformative technology. “We’re going to compete for a long time,” he added.

Nvidia CEO Jensen Huang says China is right behind the U.S. in the AI race while at the Hill and Valley Forum. pic.twitter.com/XbVL5iQgFf

— Turpentine (@TurpentineMedia) April 30, 2025

At the forum, Huang, in conversation with Jacob Helberg, Under Secretary of State for Economic Growth, Energy, and the Environment nominee and forum co-founder, weighed in on AI’s impacted on manufacturing. “Every company that makes things today—whether lawnmowers or construction machinery—will shift from manual to autonomous or semi-autonomous systems,” he said. “When it becomes autonomous, it’ll be software-defined, and you’ll need factories to produce the AI that powers it.” Huang envisioned a dual industrial model: one factory building physical products, another generating the AI “tokens” that drive them.

NVIDIA CEO Jensen Huang explains to @jacobhelberg how every company with a physical factory will also operate an AI factory: pic.twitter.com/R8MyrPMEEP

— Turpentine (@TurpentineMedia) April 30, 2025

Huang also addressed AI’s impact on the labor market, predicting that the changes, though severe, will be a net-positive for society. “New jobs will be created, some jobs will be lost, every job will be changed,” he said, advocating a first-principles approach to avoid hyperbolic forecasts. He pointed to San Francisco’s revival as evidence of AI’s economic potency. “Just about everybody evacuated San Francisco. Now it’s thriving again—all because of AI,” he said. The technology is reshaping software development, moving from human-coded programs on CPUs to machine-learning-generated code on GPUs, spawning new roles in data curation and AI safety. “All of that technology is being invented right now, and it creates tons of jobs,” Huang noted.

The most lucrative opportunity, Huang argued, lies in “AI factories”—massive facilities converting electricity into computational intelligence. These complexes, he said, represent a new industrial frontier. “A one-gigawatt factory is $60 billion,” he said, roughly equivalent to Boeing Co.’s annual revenue. With plans for factories scaling to 7-10 gigawatts, their construction and operation promise an economic windfall, particularly for skilled trades.

Nvidia CEO Jensen Huang on how AI will transform the labor market and be a boon for tradecraft workers like electricians and plumbers: pic.twitter.com/9cYDbB1GU4

— Turpentine (@TurpentineMedia) April 30, 2025

“You need carpenters, steelworkers, masons, mechanical and electrical engineers, plumbers, and IT specialists,” Huang said, estimating a three-year construction cycle per factory. “A whole bunch of new trade jobs have to be created.”

China’s manufacturing activity in April saw its worst contraction since December 2023, exposing sharp signs of weakness in Asia’s biggest economy from the trade war with the US, and boosting calls for fresh Chinese stimulus, which is always “just around the corner” but never arrives.

In the aftermath of significantly higher US tariffs, China’s official NBS manufacturing PMI fell to 49.0 in April from 50.5 in March, much lower than consensus expectations, the lowest reading since May 2023. The non-manufacturing PMI, which includes services and construction, fell to 50.4 from 50.8 also missed expectations driven by weakness in both construction and services sectors, but remained above the 50-mark separating growth from contraction.

Separately, the unofficial Caixin manufacturing PMI also fell to 50.4 in April from 51.2 in March.

The reading contrasts with Chinese officials’ conviction that the world’s second-largest economy is well placed to absorb the U.S. trade shock and confirms that domestic demand remains weak as factory owners struggle to find alternative buyers overseas.

Here are the details:

1. The NBS manufacturing PMI headline index fell to 49.0 in April from 50.5 in March, the lowest reading since May 2023. Among major sub-indexes of NBS manufacturing PMI, the output sub-index fell to 49.8 from 52.6, the new orders sub-index declined to 49.2 from 51.8, and the employment sub-index fell to 47.9 from 48.2. The suppliers’ delivery times sub-index inched down to 50.2 in April from 50.3 in March. NBS commented that the output and new orders sub-indexes of textile and metal products were below 50 in April.
    
2. On the trade-related sub-indexes, the manufacturing new export order sub-index decreased notably to 44.7 in April (vs. 49.0 in March), the lowest reading since December 2022. The import sub-index fell to 43.4 in April (vs. 47.5 in March). Inventory and price sub-indexes showed inventory drawdowns and deflationary pressures. The raw material inventories sub-index edged down to 47.0 from 47.2, and the finished goods inventories sub-index decreased to 47.3 from 48.0. The input cost sub-index decreased sharply to 47.0 (vs. 49.8 in March). The output prices sub-index also fell to 44.8 (vs. 47.9 in March). Larger manufacturers appeared to show a bigger activity deceleration. By enterprise size, the PMI of large/medium/small enterprises fell to 49.2/48.8/48.7 from 51.2/49.9/49.6 in April, respectively.

   
    

3. The Caixin manufacturing PMI, which was released shortly after the NBS print, fell to 50.4 in April from 51.2 in March, amid a sharp fall in new export orders and overall factory activity slowing. Sub-indexes in the Caixin manufacturing PMI suggest a modest decline in the output sub-index in April (51.6 vs. 51.8 in March), a significant slowdown in new orders (50.5 vs. 52.1 in March), weaker employment (49.0 vs. 50.1 in March), and deflationary pressures in price indicators (input prices increased to 49.7 from 48.4 and output prices increased to 49.2 from 49.1). The new export orders sub-index fell sharply to 47.5 in April from 52.0, the lowest reading since July 2023, suggesting weaker external demand amid higher US tariffs. Surveyed companies noted that greater competition among vendors amid subdued demand for inputs led to a drop in input costs in April. Firms often shared cost savings with their customers, and lowered their selling prices accordingly.
4. The official non-manufacturing PMI (comprised of the services and construction sectors) fell to 50.4 in April (vs. 50.8 in March). The services PMI decreased to 50.1 (vs. 50.3 in March). According to the survey, the PMIs of air transportation, telecommunications, radio, insurance, television and satellite transmission services sectors were above 55 while the PMIs of water transportation and capital market services were below 50 in April. The construction PMI fell in April to 51.9 (vs. 53.4 in March). NBS noted that the growth of the infrastructure-related construction PMI rose to 60.9 in April from 54.5 in March.

Manufacturers had been front-loading outbound shipments in anticipation of the duties, but the arrival of the levies has called time on that strategy, putting pressure on policymakers – who had for the past year merely promised to do something instead of actually doing something – to finally address rebalancing the economy.

“The sharp drop in the PMIs likely overstates the impact of tariffs due to negative sentiment effects, but it still suggests that China’s economy is coming under pressure as external demand cools,” Zichun Huang, China Economist at Capital Economics, said. 

“Although the government is stepping up fiscal support, this is unlikely to fully offset the drag, and we expect the economy to expand just 3.5% this year.”

Huang added that negativity among the survey’s respondents “probably exaggerates the impact of the tariffs,” noting that “the new export orders index dropped back to its lowest level, COVID-19 disruptions aside, since April 2012.”

Trump’s decision to single Beijing out for import duties of 145% comes at a particularly difficult time for China, which is struggling with deflation due to sluggish income growth and a prolonged property crisis.

Beijing has largely relied on exports to shore up the fragile economic recovery since the end of the pandemic and only began to take steps to boost domestic demand more earnestly late last year. 

Zhao Qinghe, an NBS statistician, said the drop was largely down to “sharp changes in (China’s) external environment,” in a note accompanying the release. China’s yuan inched lower against the dollar following the data’s release, as the first data since Trump’s tariff announcement pointed to early signs of damage to the economy.

While China has repeatedly denied it is seeking to negotiate with the U.S. a way out of the tariffs, and appears to instead be betting that Washington makes the first move, continued economic deterioration will force Beijing’s hand. 

“We expect the manufacturing PMI to be in contraction in May, but it is expected to rise to about 49.5, driven by an increase in stable growth policies,” said Wang Qing, chief macro analyst at Oriental Jincheng.

He said further cuts to interest rates and the amount commercial banks must hold in reserve may be needed as conditions worsen. On Monday, the vice head of China’s state planner said the National Development and Reform Commission (NDRC) would roll out new policies over the second quarter in line with the prevailing economic conditions of the time.

That followed pledges by the Communist Party’s elite decision-making body, the Politburo, on Friday to support firms and workers most affected by the duties. The general consensus among China observers is a second trade war with the U.S. will significantly weigh on growth, but the NDRC’s Zhao Chenxin said he was confident the country would achieve its 2025 economic growth target of around 5%.

The International Monetary Fund, Goldman Sachs and UBS all recently revised down their economic growth forecasts for China over 2025 and into 2026, citing the impact of U.S. tariffs – none of them expect the economy to hit Beijing’s official growth target.

Authored by Jonathan Turley,

The first 100 days of the Trump administration have been described in the same way on sites ranging from the ACLU to Vanity Fair: Chaos.

It seems like the Justice Department is battling everywhere on everything at the same time.

It is indeed chaos, but it is not necessarily as random or as reckless as it may seem to the naked eye.

I have been critical of a number of legal moves by the Trump administration, including policies that undermine free speech values. Yet there is a type of legal chaos theory behind all of these actions. In science, chaos theory suggests that, even in a system of seemingly random actions, there can be patterns and interconnections.

The hyperkinetic litigation around the country reflects two realities.

• First, Democratic state governments and groups have a massive war chest to challenge any and every new policy of President Trump. In California, the Democrats actually pre-approved a litigation fund before the inauguration to do precisely that.

• Second, and more importantly, Trump promised sweeping changes from immigration to transgender policies to education reforms.

If you know that you are going to be challenged, it is better to get into court as soon as possible to move critical cases through the legal system. What you need is finality. Even if you lose cases, you need to know what authority you have.

Immigration wins

This is an administration in a hurry. Trump learned in his first term that you need to move as fast and as far as possible in the first two years of a presidential term.

With the midterm elections looming, Trump knows that reforms may end and investigations and impeachments will begin if the Democrats retake the House in 2026.

Despite some losses, the Justice Department has succeeded generally in reaffirming its authority to seek the reduction of government and to root out waste. It has also made real progress in other areas.

Take the area of greatest success for the Trump administration: Immigration.

One thing that was clearly established in the first 100 days is that the entry of millions of unlawful immigrants was a choice made by the Biden administration and the Democrats. They could have stopped most of these entries at any time, but elected to leave the southern border effectively open for four years as millions poured over.

In a matter of weeks, Trump effectively closed the border. In February, there were just 8,326 southern border encounters, down from 189,913 in February 2024. Daily encounters this week declined 97% from Biden.

As many of us stated during the Biden administration, Democrats could have shut down the border, but clearly did not want to. Now with millions in the country, Democrats are calling for “pathways to citizenship” by arguing that there is no way to process so many illegals allowed in under Biden.

In the meantime, the public overwhelmingly favors deportations and elected Trump on his pledge to carry out such removals. Polling shows that 83% of Americans support deportations of immigrants with violent criminal records and roughly half support mass deportation of all undocumented persons.

A new CBS polls shows that, after the first 100 days, 56 percent approve of President Donald Trump’s “program to find and deport immigrants who are in the U.S. illegally.”

National injunctions

To carry out that policy, Trump is seeking to use new expedited systems. For the worst individuals, he has turned to the centuries-old Alien Enemies Act, a little-used act that presents a series of novel, unresolved questions.

Even with this smaller subset of detainees, individual hearings and appeals could make Biden’s decision to allow millions into the country a permanent reality. Many immigrants have been given initial court dates that extend beyond the Trump term.

Trump also pledged to reduce trade barriers for American exports and he is pushing existing laws to the breaking point on tariffs. He is right on the merits.

Even our closest allies impose unfair barriers to our goods and Trump sought to change the status quo with sweeping tariffs issued under his own authority.

Democrats have challenged that authority in various courts and, again, there are good-faith arguments that must be hashed out in court.

It is too early to tell how successful these cases will prove. However, a district court injunction (or even a dozen injunctions) a crisis does not make.

The Supreme Court is about to hear arguments on limiting the use of national injunctions and some of these district court decisions are highly challengeable on appeal.

There is no question that Trump is moving at a lightning speed and the Justice Department has to move at the same pace as the president.

There is also no question that it would better to slow down to avoid some of the unforced errors in the first 100 days.

However, Trump knows that time is of the essence. If he is going to realign the markets and make progress on issues like deportations, he has to put points on the board before the midterm elections. Ronald Reagan lost 26 seats in the House in his first midterm, Bill Clinton lost 54, and Barack Obama lost a breathtaking 63 seats.

The greatest problem for the Justice Department is that the White House and the political team appear to be largely dictating these moves. Political aides see these hills as worth dying on. Even if they lose in court, fighting to remove criminal aliens or to reduce certain foreign aid remains popular with voters.

Don’t alienate judges

The frenzy, however, can come at a cost. That includes alienating justices on the Supreme Court. The resistance to court orders and hyperbolic rhetoric seems to be wearing thin with members like Chief Justice John Roberts.

Trump will need these votes when they really count on big-ticket items like his inherent authority to act in areas ranging from markets to migrants.

Fights over Kilmar Armando Abrego Garcia are burning time and effort. If he was simply returned as ordered by a court, Abrego Garcia could be promptly and correctly deported right back to El Salvador. He has no cognizable basis for remaining in the United States.

Richard Carlson, a Bay Area psychotherapist, famously wrote a book titled “Don’t Sweat the Small Stuff … and it’s all Small Stuff.” Fights like Garcia are small stuff.

Of course, much of what presidents do is “big stuff” and you have two years to make those things happen. In a curious way, the Trump administration is fortunate to have many of these issues in court early to gain greater finality on the lines of authority. However, it needs to focus on the big stuff . . . and a short calendar.

*  *  *

Jonathan Turley is a law professor at George Washington University and the author of best-selling book “The Indispensable Right: Free Speech in an Age of Rage.”

There were good and bad news in today’s GDP report.

Starting with the bad news, Q1 GDP printed -0.3%, worse than the -0.2% expected and the first negative print since Q1 2022 when the economy was in a recession but was subsequently revised out of it

The good news is that the drop was actually supposed to be much worse (recall the Atlanta Fed’s latest GDP estimate was -2.7%, or -1.5% excluding record gold imports). Indeed, if one looks at the components of today’s GDP print one finds that the number was actually unexpectedly strong, if one strips out the two negative components, net trade and government.

As shown in the chart below, Q1 GDP comprised of the following components:

• Personal Consumption 1.21%, down from 2.70%, but translating into an annualized Personal Consumption print of 1.8%, much higher than the 1.2% expected
• Fixed investment jumped to 1.34%, up from -0.2% and the highest since Q2 2023 as the BEA finally starts tracking data center investment correctly
• Change in private inventories surged 2.25%, as expected, on the pre-tariff restocking; this number was up from a -0.84% drop last quarter and is expected to reverse in coming quarters as inventories are sold off.
• Government spending was a negative -0.25%, the first negative print for Joe Biden’s favorite “plug” to push GDP higher since 2022.
• Finally, and most importantly, net trade (exports less imports) was a whopping 4.830% hit to the final GDP number, a 5% swing from the +0.26% contribution in Q4. This was entirely the result of soaring imports (of which gold was about half) in Q1 which hit GDP by a near record 5.03%. Just like inventories, this number will now reverse in coming quarters as tariff frontrunning ends and is reversed.

And visually:

Taking a closer look at the import contribution to GDP, which was the biggest swing factor, one can see that at 5.03%, this was the 2nd highest on record with just the outlier covid shock bigger. In other words, absent economic shock, this was a record quarterly print.

In its commentary, the BEA confirmed as much, writing that “the decrease in real GDP in the first quarter primarily reflected an increase in imports, which are a subtraction in the calculation of GDP, and a decrease in government spending. These movements were partly offset by increases in investment, consumer spending, and exports.”

Compared to the fourth quarter, the downturn in real GDP in the first quarter reflected an upturn in imports, a deceleration in consumer spending, and a downturn in government spending that were partly offset by upturns in investment and exports.

Turning to inflation, the BEA reported that the price index for gross domestic purchases increased 3.4 percent in the first quarter, compared with an increase of 2.2 percent in the fourth quarter. The personal consumption expenditures (PCE) price index increased 3.6 percent, compared with an increase of 2.4 percent. Excluding food and energy prices, the PCE price index increased 3.5 percent, compared with an increase of 2.6 percent.

Putting these in context, GDP Price index of 3.7% came in hotter than the 3.1% expected, while the core PCE of 3.5% was also hotter than the 3.1%.

Bottom line, the GDP number was much stronger than expected, in fact it was a whopping 2.4% higher than the now laughable AtlantaFed GDP forecast, and if anything this positions the Trump admin for a surprise bounce in Q2 and/or Q3 when all the outlier prints from Q1 are reversed.

After several false starts and timeline projections which didn’t pan out, Ukraine is imminently ready to sign the mineral resources deal with the US, Bloomberg has quoted a source close to negotiations as saying.

“The draft agreement, which envisages creating a joint fund to manage Ukraine’s investment projects, has been finalized and may be signed as soon as Wednesday, the person said, speaking on condition of anonymity because the talks are private,” the report says, noting that Ukrainian Economy Minister Yulia Svyrydenko is en route Washington for the signing.

A source in Ukrainian President Zelensky’s office has separately told the Kyiv Independent that it will be signed by Wednesday evening. A draft document says the deal seeks to create conditions to “increase investment in mining, energy, and related technology in Ukraine.”

Crucially,  the agreement excludes any conditions which say it is related to Ukraine’s debt for prior US military or financial assistance. Kiev and many of its European allies had balked at that prior controversial proposal, which had centered on Trump’s insistence that Ukraine pay back the hundreds of billions provided by the American taxpayer after over three years of war.

Bloomberg details, “In another breakthrough, the US has agreed that only future military assistance it may provide to Ukraine following the signing of the deal would count toward its contribution to the fund, according to the document.”

Ukrainian Prime Minister Denys Shmyhal first unveiled Sunday that the Trump administration had dropped this requirement of paying back past debt.

The document “strengthens the strategic partnership between the Parties for the long-term reconstruction and modernization of Ukraine, in response to the large-scale destruction caused by Russia’s full-scale invasion” – but many specifics regarding rare earth mineral access remain unclear as of yet.

Washington and Kiev have until now spent months dancing around a deal that would allow the US access to Ukraine’s mineral deposits, which was originally proposed by Zelensky as part of his five-point “Victory Plan” unveiled last October to secure US support. 

Many of Kiev’s supporters called it insultingly lopsided, and tantamount to a resource grab by the US, with Ukrainian lawmakers at one point calling an earlier revision to the mineral agreement a “horror” that offered no security guarantees from Washington.

Trump was really ramping up the pressure personally on Zelensky just last week…

An initial version of the deal sought to grant the Untied States access to all existing and future mineral deposits across Ukraine, along with oil and gas throughout the country. It would still have to be ratified by Ukrainian parliament after it is signed, theoretically at least and according to Ukrainian law.

While jobless claims refuse to show even a glimmer of hope to the doomsaying ‘recession is imminent and it’s all because of Trump’ narrative, this morning’s ADP gives us a potential glimpse at what Friday’s ‘most important payrolls print ever’ will offer.

…and the picture is not pretty at all…

According to ADP, the US economy added just 62k jobs in April – the lowest since July 2024’s dip

Source: Bloomberg

Education and health services, information, and professional and business services lost jobs, while hiring in other sectors was moderate.

“Unease is the word of the day,” says Nela Richardson Chief Economist.

“ADP Employers are trying to reconcile policy and consumer uncertainty with a run of mostly positive economic data. It can be difficult to make hiring decisions in such an environment.”

Goods-Producing jobs outperformed Service-Providing jobs…

There is more bad news –

Pay for job-stayers rose 4.5 percent in April from a year earlier, a slight deceleration from March. 

Year-over-year pay gains for job-changers accelerated, rising from 6.7 percent in March to 6.9 percent in April – the highest since Dec 2024.

The question is – will this dreadful jobs print prompt The Fed to come back to the table (or is the wage re-acceleration enough to keep them away)?

The market is moving that way – pricing in four cuts for 2025 now.