Authored by MN Gordon via EconomicPrism.com,

“It is significant that the nationalization of thought has proceeded everywhere pari passu with the nationalization of industry.” – EH Carr

Denying the Truth

Central planners face an impossible task.  They must compel people to behave in ways that go contrary to freedom of choice.  Only those full of conceit and having an outsized ego would make a career out of this line of work.  You know the types…

Thou shalt only take public transportation.  Thou shalt pay income taxes.  Thou shalt consume bugs.  Thou shalt use electric leaf blowers.  Thou shalt own nothing and be happy.  Thou shalt have a permit to sell lemonade.  Thou shalt do as I say not as I do.

Yet, even when the plebs go along, the plans of central planners never work out as intended.  They’re costly.  They create unnecessary work.  They can also be extraordinarily destructive.

Rather than accepting their limitations, however, central planners redouble their efforts.  They create complicated incentive programs.  They reward one industry at the expense of another.

And when their promises of the more abundant life don’t square with reality, what do they do?  They fabricate lies to deny the truth.

Take Treasury Secretary Janet Yellen, for instance.  She must have exceptional vision.  She sees what no one else can.  In particular, she sees a path for avoiding a U.S. recession.

Yellen’s path involves a decline in the rate of inflation and a strong U.S. labor market.  She was even kind enough to describe what it looks like on ABC’s Good Morning America:

“You don’t have a recession when you have 500,000 jobs and the lowest unemployment rate in more than 50 years.  What I see is a path in which inflation is declining significantly and the economy is remaining strong.”

Yellen pointed to last week’s U.S. Bureau of Labor Statistics employment report.  The propaganda machine’s January data was a real leg slapper.  It showed an increase in nonfarm payrolls of 517,000 jobs.  Consequently, the unemployment rate fell to 3.4 percent – a 53 year low.

Baseless Disinformation

What Yellen didn’t mention is that her path for avoiding a recession doesn’t exist.  For starters, the BLS data is baseless disinformation.  When the bogus “adjustments” the bureaucrats added are taken out it’s revealed that the U.S. economy actually lost 2.5 million jobs in January.

The roughly 3 million jobs that were added to show a positive increase of 517,000 jobs were completely fictitious.  In reality, the economy is hemorrhaging jobs.

Dell Technologies, for example, is RIFing 6,650 jobs.  They’re doing so because the demand for personal computers has abruptly evaporated.  These reductions in force (RIFs) will reduce Dell’s global payroll by about 5 percent, bringing it to a six year low.

This comes as Boeing and Zoom announced layoffs of 2,000 and 1,300 employees, respectively.  Similarly, Meta, Twitter, Google, Microsoft, Opendoor, and Amazon have all had recent layoffs.

These are high paying technology jobs that are disappearing.  Adding low paying healthcare jobs at nursing homes won’t drive economic prosperity.  Nor will adding government jobs, which are financed with debt.

According to tech job tracker layoffs.fyi, there have been nearly 260,000 technology jobs lost since the start of last year.  What’s more, in 2023 alone, as of early February, technology companies have laid off over 98,100 employees.

Clearly, the BLS report is utter nonsense.  As for Yellen’s inflation claim?

The consumer price index (CPI) report for January will be released next week.  We anticipate the number fabricators will show that the rate of consumer price inflation continues to slow.

Does this propaganda even remotely jive with the total price you pay when buying your weekly groceries?  What about your recent utility bills?

The prices Americans are paying for these essentials are off the charts.

Does anyone care that you can now buy shares of GOOG for 27 percent less than you could one year ago?  You can’t eat GOOG, and there’s no dividend.  And even if you could, it’s still a terrible deal.

Yellen, through BLS lies, is denying the truth.  Should we expect any different…

Arrested Development

Yellen, if you don’t remember, was Chair of the Federal Reserve from 2014 to 2018.  She’s only the second bureaucrat to be both Fed Chair and then Secretary of Treasury.  The first was G. William Miller way back when Jimmy Carter was President.

Miller was a poor steward of the dollar.  Inflation went Richter on his watch.

Yellen, like Miller, has had the unique opportunity to authorize money using credit she previously issued.  The consequences under Yellen have been equally destructive for the dollar.  In fact, they may even be worse.

Prior to her time as Fed Chair, Yellen held various positions with the Federal Reserve over a 20-year run.  We don’t really know much about what she did.  But, at a minimum, she participated in an era of unprecedented Fed activism.

Certainly, Yellen has spent hours squinting at graphs and charts while contemplating how central planners can compel them to appear more to their liking.  She also believes monetary policy is a moral issue.

In fact, back in 1995, at a Federal Open Market Committee meeting, Yellen argued in favor of allowing inflation to exceed inflation targets for moral reasons.  The late Robert Wenzel documented the discussion in his Economic Policy Journal:

“Ms. Yellen told the committee that ‘the moral’ of all this is ‘that the Fed should pursue multiple goals.’  She said that ‘when the goals conflict and it comes to calling for tough trade-offs, to me, a wise and humane policy is occasionally to let inflation rise even when inflation is running above target.’”

We’re now living with the result of the wise and humane policies of central planners…

Living the Lie

Inflation, in a practical sense, acts as a hidden tax on savers and wage earners.  It devalues the purchasing power of their savings and paychecks.  Moreover, inflation robs them of the time and sacrifices they made to earn it.

Ask any retiree living on a fixed income or a hardworking prudent individual skimping to squirrel away some nuts for retirement.  Policies of inflation are not wise and humane; they are deceptive and cruel.

Yellen, no doubt, wakes each morning, sips her coffee, and gazes out across the economic landscape.  What she sees, if she’s honest, is an absolute cluster.  But with the propaganda machine on her side, she can get to work elaborating ideas, rationalizations, and justifications for why everyone – including you – is living the dream.

The unemployment rate is low.  Jobs are being created in abundance.  Inflation is moderating.  There’s a clear path to avoiding a recession. So long as we walk down it together.  Yellen says so.  CNN says so too.

The problem with government propaganda, among many, is that it denies the truth.  It attempts to induce people, through repeated justifications, to accept an official narrative that anyone with a small modicum of curiosity knows to be a lie.

By denying the truth, these state actors are disrespecting the truth. 

And by disrespecting the truth, they open a Pandora’s box full of moral obscenities.  The means become blurred with the ends.  The world becomes something much different than what’s advertised.

And the remnants of a free society slip beneath the lies layered upon lies.

*  *  *

Don’t believe the lies of central planners.  The economy’s cracking up.  Financial markets are at an extremely dangerous place.  Discover how to use the Financial First Aid Kit to protect your wealth and profit as the global economy slips into a worldwide depression.

A new study published on the Social Science Research Network (SSRN) reveals that exchange-traded funds (ETFs) are a “new form” of insider trading for those in the ‘know’ about upcoming merger and acquisition deals. The reason is that the ETF conceals their trading and is harder to track because the fund owns a basket of other stocks. Insiders, who trade on non-public information, are pivoting from single stock bets ahead of announcements because securities agencies can easily flag trading activity. 

The paper is titled “Using ETFs to Conceal Insider Trading” and explains:

Our evidence suggests that some traders in possession of material non-public information about upcoming M&A announcements trade in ETFs that contain the target stock, rather than trading the underlying company shares, thereby concealing their insider trading. 

Researchers described several reasons insiders gravitate toward ETFs:  

• First, the stock that is the subject of the information may be a constituent of the ETF, so that one can get a direct exposure to the company’s share price via the ETF, but in a vehicle that is more subtle than trading the company shares directly, helping reduce scrutiny from law enforcement.

• Second, ETFs are cost-effective and often more liquid than the underlying company shares, potentially reducing the price impact of insider trades. Both theoretical and empirical evidence shows that insiders trade in highly liquid assets so that they can hide their information and maximize their trading profits.

• Third, shadow trading in ETFs prior to price-sensitive news allows insiders to benefit from increases in the price of both the source firm and related firms.

Using 13 years of data (2009-21) of all US-listed companies and ETFs, researchers found “significant levels” of transactions known as shadow trading or insider trading. Their results were derived from analyzing sizeable volume increases in the five days before M&A announcements in 3% to 6% of industry ETFs. 

“These ETFs, which are the most likely to be traded by insiders if shadow trading does occur, have significantly higher levels of abnormal trading than various randomized control samples of other ETFs and other trading days. We eliminate M&A events that are preceded by rumors to ensure that the analysis is not picking up general information leakage,” Elza Eglite, Dans Staermans, Vinay Patel, and Talis Putnins wrote in the study. The paper is from academics at the Stockholm School of Economics in Riga and the University of Technology, Sydney. 

The amount of insider trading they identified was about $2.75 billion during the researcher’s same period or about $212 million per year. 

“Our estimates of the amount of shadow trading in ETFs provide a lower bound given that we only examine shadow trading prior to M&As and not prior to other price-sensitive news announcements,” they said. 

This study shows that some insiders conceal their trades in ETFs instead of single stocks. 

Submitted by Paul H. Kupiec and Alex J. Pollock,

When it comes to the debt ceiling, both the Fed and the New York Times get It wrong…

At the February FOMC press conference, Federal Reserve Chairman Powell was asked, “…about the debt ceiling. Given that we’ve now hit up against it…will the Fed do what Treasury directs as it relates to making payments or will it do its own analysis of any legal constraints?”  Powell responded, “There’s only one way forward here, and that is for Congress to raise the debt ceiling.”

The New York Times took issue with this response, peddling the idea that the Treasury could mint an obviously phony trillion dollar coin to pay the government’s bills.

But those are not the only choices. 

There is a better way forward that is legally sound and has nothing to do with creating a fictitiously-valued platinum coin. 

Congress should simply direct the US Treasury to value its gold holdings, which are real, at real market prices. 

The Treasury would then have sufficient funds to pay its bills beyond fiscal 2023 without raising the debt limit.

The current market price of gold is a little over $1,875 per ounce. Treasury owns about 261.5 million ounces of gold, or more than eight tons. Because the Gold Reserve Act, as amended by Congress in 1973, requires the US Treasury to value its gold at $42.22 on ounce, the Treasury values its gold holdings at a little over $11 billion whereas the true market value of its gold is roughly $490 billion.

If Congress were to make a simple, financially sound amendment to the Gold Reserve Act, it would free up nearly $480 billion in new Treasury cash without raising the debt limit.

These funds would allow the Treasury to pay all its bills past the end of fiscal 2023, thereby giving Congress an entire session to debate, negotiate budgets, reduce deficits, and set the debt ceiling accordingly, all in bills passed under regular order—something that has not happened in years.

The US Treasury is already unquestionably authorized to monetize the value of its gold holdings by issuing gold certificates.

The Gold Reserve Act provides that: “The Secretary [of the Treasury] may issue gold certificates against other gold held in the Treasury. The Secretary may prescribe the form and denominations of the certificates.”

The US Treasury long ago used this power to create gold certificates using the now long out of date price of $42.22 per ounce to create a little more than $11 billion in gold certificates. There certificates have been on deposit at the Federal Reserve for decades. When they were originally deposited, the Fed credited the US Treasury’s account with an equivalent value of dollar balances that the Treasury could spend. 

The government can fund itself past the end of the fiscal year if Congress merely recognizes that the Treasury’s gold is a real massively undervalued monetary asset.  Unlike the phony idea of the Treasury issuing a trillion-dollar platinum coin, the Treasury already has the legal authority to monetize its gold holdings without creating new government debt. It is only because Congress has failed to amend a woefully outdated law that the Treasury values its gold at an absurdly low price.

To monetize the market value of the Treasury’s gold holding, the Congress need only replace five words in the Gold Reserve Act.  Replacing “42 and two-ninths dollars” with “the current market value (as determined by the Secretary at the time of issuance),” would allow the Treasury to use nearly $480 billion in spendable dollars without raising the current debt limit.

With the proposed change, the Treasury can issue new gold certificates against the market value of its gold and deposit these certificates into its account with the Federal Reserve.  The Fed will credit the Treasury’s account with an equivalent value in dollars, and the Treasury can spend the money as needed.  In other words, Congress can create another $480 billion in spendable dollars without adding a penny of additional Treasury debt. Should the Fed deem it necessary to offset any inflation concerns, the increase in reserve balances can be sterilized with open market operations.

By simply recognizing reality, this change would give the Congress time to negotiate, in regular order, a bipartisan 2024 fiscal year budget with spending cuts, and pass a new appropriately-sized debt ceiling for government funding in fiscal 2024 and beyond.

It would be ridiculous, wouldn’t it, for the Treasury to default on its debt when it owns almost half a trillion dollars worth of the most classic monetary asset there is.  By monetizing the Treasury’s gold using already existing legal processes, the government can pay its bills through the end of fiscal year 2023—with no increase in the debt limit needed and no phony platinum coin involved.

*  *  *

Paul H. Kupiec is a senior fellow at the American Enterprise Institute.  Alex J. Pollock is a senior fellow at the Mises Institute and the co-author of the new book, Surprised Again!—The Covid Crisis and the New Market Bubble. 

Authored by Samantha Flom via The Epoch Times,

The Department of Homeland Security (DHS) has hired outside legal counsel in anticipation of potential impeachment proceedings against DHS Secretary Alejandro Mayorkas.

“The Department of Homeland Security has retained outside counsel to help ensure the Department’s vital mission is not interrupted by the unprecedented, unjustified, and partisan impeachment efforts by some Members of Congress, who have already taken steps to initiate proceedings,” a DHS spokesperson told The Epoch Times in a Feb. 10 statement.

“DHS will continue prioritizing its work to protect our country from terrorism, respond to natural disasters, and secure our borders while responding appropriately to the over 70 Congressional committees and subcommittees that have oversight of DHS.”

Articles of Impeachment

Rep. Pat Fallon (R-Texas) filed three articles of impeachment against Mayorkas on Jan. 10, charging that the DHS secretary had committed “high crimes and misdemeanors” and violated his oath of office by failing to maintain operational control of the border as outlined by the Secure Fence Act of 2006; willfully providing “perjurious, false, and misleading testimony” to Congress; and “slandering” Border Patrol agents by supporting false claims that they had used whips on illegal immigrants.

Last week, Rep. Andy Biggs (R-Ariz.) introduced his own resolution to impeach Mayorkas, echoing Fallon’s assertion that the DHS chief had been derelict in his duties and adding that his actions had “subverted the will of Congress” and the Constitution.

“Every day Secretary Mayorkas remains in office America becomes less safe,” Biggs contended in a Feb. 1 statement.

“Secretary Mayorkas is the chief architect of the migration and drug invasion at our southern border,” he continued.

“His policies have incentivized more than 5 million illegal aliens to show up at our southern border—an all-time high figure. Instead of enforcing the laws on the books and deporting or detaining these illegal aliens, the vast majority of them are released into the interior and never heard from again.”

Further holding that Mayorkas has allowed deadly drugs like fentanyl to pour across the U.S.–Mexico border, Biggs added: “It’s clear Secretary Mayorkas has committed high crimes and misdemeanors. His conduct is willful and intentional. He is not enforcing the law and is violating his oath of office. For these reasons, Secretary Mayorkas should be impeached.”

Biggs was the first member of Congress to introduce articles of impeachment against Mayorkas in August 2021, though at that time, the Democrats controlled the House. Now that the Republicans hold a slim majority, however, the move may have enough support to proceed.

…

Read more here…

 A man driving a truck hit “went on a rampage” and hit several pedestrians in Bay Ridge, Brooklyn, on Monday morning, said a New York City councilman.

“A man driving a U-Haul went on a rampage in Bay Ridge,” City Councilman Justin Brannan wrote on Twitter Monday, adding that “several people were hit and badly injured.”

“We have no idea of motives at this time but this wasn’t an accident,” Brannan claimed.

“We think he hit at least 6 people with the truck and 2 are in very bad shape. PLEASE pray for these folks.”

Video footage posted online on Monday showed the incident in Brooklyn involving a U-Haul truck.

#UPDATE: Police in #Brooklyn, #NY, are treating this as an terror related incident aften an U-haul truck deliberately hit multiple pedestrians pic.twitter.com/05lid0J8x0

— Breaking News 24/7 (@Worldsource24) February 13, 2023

Police officials told local media reported that a man in his 30s was hit by the U-Haul on 4th Avenue, while three other men who were on mopeds were struck and sustained minor injuries.

A man driving a U-Haul went on a rampage in Bay Ridge. He was just apprehended in Sunset Park. Several people were hit and badly injured. We have no idea of motives at this time but this wasn’t an accident. Thank you to @NYPD72Pct @NYPD68Pct. I will share more info when I can.

— Justin Brannan (@JustinBrannan) February 13, 2023

The Epoch Times’ Jack Phillips reports that the incident happened on the same day a convicted terrorist, Sayfullo Saipov, is facing sentencing for killing eight people in a 2017 rampage while driving a U-Haul truck down a New York City bike path. A jury is considering a possible death sentence.

Saipov has previously expressed admiration for the ISIS terrorist group and has said he had an obligation to carry out those attacks, according to his attorney. “And as we sit here today, he still believes that, he still believes the ISIS messaging and he still believes it was God’s will that he do what he did,” Saipov’s attorney David Patton said last month.

Officials have not publicly said whether the two incidents were linked.

Meanwhile, the suspect attempted to evade capture before police arrested him following a chase.

Suspect was actually arrested near the BK Battery Tunnel. We think he hit at least 6 people with the truck and 2 are in very bad shape. PLEASE pray for these folks.

— Justin Brannan (@JustinBrannan) February 13, 2023

The driver of the U-Haul truck is currently being held at the 72nd Precinct in Sunset Park, a nearby area of Brooklyn.

Fox News reports that law enforcement sources reportedly told the New York Post the individual in custody is known to authorities stemming from a prior EDP [emotionally disturbed person] incident from 2019.

Roberts Boyce, the former New York City Police Department chief of detectives, told ABC7 that both incidents are comparable.

“Its the first thing I thought,” Boyce told the outlet. “I worked the Sayfull Saipov case I remember how dangerous it was and what he did and how deadly it was. That was the first thing that came to mind when I heard the rented truck. So let’s hope it’s not that and it’s a person in mental distress at this point and it’s nothing more than that. It’s difficult to link the two right now but how can you not think about that?”

On New Year’s Eve, three NYPD officers were attacked by a man wielding a macheted near Times Square, officials said. Trevor Bickford, a 19-year-old from Maine, was arrested and charged in that case last month as reports indicated that he may have been motivated by Islamic extremist viewpoints.

NYPD’s bomb squad is at the scene to check the truck for possible explosives.

With long-term inflation expectations (those 3-Years ahead or more) peaking more than a year ago, and even shorter inflation expectations – at least according to the NY Fed Survey of consumers – now sliding after hitting a record high 6.8% in June, we have seen a marked bounce in 2Y breakevens in recent weeks, which after recently hitting the lowest level in 2 years, have risen from 2% to 2.75% largely on the back of expectations for a bounce in commodity prices…

…which is why ahead of tomorrow’s CPI print – which many expect will come in hotter than expected – many were curious to see whether the latest, just released NY Fed survey, would show a continued drop in inflation expectations, or whether January would prove to be an inflection point. The answer: while median one-, and three-year-ahead inflation expectations both decreased – from 4.99% to 4.95%, and from 2.99% to 2.71% (the lowest since Oct 2020) respectively, it was 5-year inflation expectations, which the NY Fed tracks and updates only periodically, that posted a modest increase for the second month in a row, rising from 2.32% in November to 2.42% in December and then again to 2.45% in January.

As usual, the numbers were notable enough to get flagged by Fed whisperer Nick Timiraos.

New York Fed: Median inflation expectations in January remained unchanged at 5.0% at the one-year horizon, decreased by 0.2 percentage points to 2.7% at the three-year horizon, and rose 0.1 point to 2.5% at the five-year horizon https://t.co/eiB3NEA7j3 pic.twitter.com/dJIWPFYEC5

— Nick Timiraos (@NickTimiraos) February 13, 2023

Median inflation uncertainty—or the uncertainty expressed regarding future inflation outcomes—remained unchanged at the one-year horizon but increased slightly at the three- and five-year horizons.

The median home price growth expectations declined by 0.2% to 1.1% in January – the second lowest reading since May 2020 – after a modest bounce in December following a plunge since early 2022 amid surging interest rates. The decrease was more pronounced among respondents who are older than 60 and respondents who live in the Northeast. That said, expectations for any price increase appear laughable when 30Y mortgages are sticky about 6% and suggests most households expect Fed tightening to reverse in the near future (as the alternative is a housing market collapse).

At the same time, job finding expectations have remained very strong (apparently no tech workers were surveyed)…

… which was bizarre because after increasing each month since September of last year, the median expected growth in household income dropped by 1.3 percentage point to 3.3% which was the largest one-month drop in the nearly ten-year history of the series.

That said, the January reading, is only slightly below its 12-month trailing average of 3.5%, and the series remains well above its pre-pandemic levels. January’s decrease was more pronounced among respondents with no more than a high school education, respondents older than 60, and those with annual household incomes below $50k.

Adding to the gloomy household finance picture, along the drop in household income we also saw continued declines in the median household spending growth expectations, which decreased to 5.7% in January from 5.9% in December. This is the third consecutive decline in the series.

And just to make sure you are very confused, the latest survey also found that perceptions about households’ current financial situations improved in January compared to December, with more respondents reporting they are better off than a year ago; this despite a bear market in stocks, vastly higher prices and wages that have decline in real terms every single month. Yes, it’s that easy to fool Americans. In contrast, year-ahead expectations about households’ financial situations deteriorated slightly, with more respondents expecting to be worse off a year from now.

Going back to the labor market, consumer optimism rebounded with the mean perceived probability of losing one’s job in the next 12 months decreased by 0.6 percentage point to 12.0%. Similarly, the mean probability of leaving one’s job voluntarily in the next 12 months decreased by 0.2 percentage point to 19.1%.

Remarkably, despite the worst bear market in a generation, 35.7% of respondents, up from 34.9% last month, expect stocks to rise in the next 12 months. Then again, 38.5% expected higher stock prices one year ago: they were brutally wrong.

Looking at a broad universe of polled prices, over the next year consumers expect gasoline prices to rise 5.15% (from 4.1%); food prices to rise 9.02% (from 7.6%); medical costs to rise 9.73% (from 9.7%); the price of a college education to rise 9.29% (from 9.2%); and rent prices to rise 9.62% (from 9.6%).

So are US consumers finally coming to grips with the reality that no more stimmies are coming and that the continued price increases coupled with a decline in real wages, means less disposable income and, eventually, a recession? Alas, there is no definitive answer yet. Instead, here are the other key findings from the report:

Inflation

• Median home price growth expectations declined by 0.2 percentage point to 1.1% in January, the second lowest reading since May 2020. The decrease was more pronounced among respondents who are older than 60 and respondents who live in the Northeast.
• Median year-ahead expected price changes increased by 1.0 percentage point for gas (to 5.1%), 1.4 percentage point for food (to 9.0%), and 0.1 percentage point for the cost of college education (to 9.3%). The median expected change in the cost of rent and medical care remained unchanged at 9.6% and 9.7%, respectively.

Labor Market

• Median one-year-ahead expected earnings growth remained unchanged at 3.0% in January. The series has been moving between a narrow range of 2.8% to 3.0% since September 2021.
• Mean unemployment expectations—or the mean probability that the U.S. unemployment rate will be higher one year from now—increased by 0.4 percentage point to 41.2%. The increase was most pronounced for respondents with a college education and those with annual household incomes above $100k.
• The mean perceived probability of losing one’s job in the next 12 months decreased by 0.6 percentage point to 12.0%. Similarly, the mean probability of leaving one’s job voluntarily in the next 12 months decreased by 0.2 percentage point to 19.1%.
• The mean perceived probability of finding a job (if one’s current job was lost) increased by 0.1 percentage point to 57.6% in January.

Household Finance

• Median household spending growth expectations decreased to 5.7% in January from 5.9% in December. This is the third consecutive decline in the series.
• Perceptions of credit access compared to a year ago improved in January, with the share of households reporting it is easier to obtain credit than one year ago increasing. Similarly, respondents were more optimistic about future credit availability, with the share of households expecting it will be easier to obtain credit a year from now also increasing.
• The average perceived probability of missing a minimum debt payment over the next three months increased to 12.1% in January from 11.4% in December.
• The median expectation regarding a year-ahead change in taxes (at current income level) increased by 0.3 percentage point to 4.4%.
• Median year-ahead expected growth in government debt increased by 0.1 percentage point to 10.2%.
• The mean perceived probability that the average interest rate on saving accounts will be higher in 12 months increased by 0.2 percentage point to 32.1%.
• Perceptions about households’ current financial situations improved in January compared to December, with more respondents reporting they are better off than a year ago. In contrast, year-ahead expectations about households’ financial situations deteriorated slightly, with more respondents expecting to be worse off a year from now.
• The mean perceived probability that U.S. stock prices will be higher 12 months from now increased by 0.8 percentage point to 35.7%.

More in the full NY Fed survey which can be found here.

Authored by Thomas Brooke via Remix News,

U.S. billionaire Elon Musk has defended the decision taken by his SpaceX company to limit the use of its Starlink satellite internet system by the Ukrainian military, insisting the company will not be responsible for escalating the Russo-Ukrainian conflict that may lead to World War III.

Shortly into the war, Ukraine was handed thousands of SpaceX Starlink satellite dishes, which proved to be invaluable in keeping communication channels open across Ukraine and allowing people to remain connected to the internet. However, they have also been frequently used by the Ukrainian military to control its network of surveillance drones and target Russian positions, which SpaceX insists was not agreed upon.

Last Wednesday, SpaceX President and CEO Gwynne Shotwell announced measures to curb the Starlink system’s use by the Ukrainian military across the country, claiming it was “never meant to be weaponized” and accusing Ukrainian forces of using the system “in ways that were unintentional and not part of any agreement.”

“We know the military is using them for comms, and that’s OK,” she said.

“But our intent was never to have them use it for offensive purposes.”

The decision outraged Ukrainian government officials, with President Zelensky’s top adviser Mykhailo Podolyak accusing Musk’s company of failing to recognize Ukraine’s right to self-defense.

He said on Thursday that SpaceX could choose to be “on the side of the right to freedom,” or instead remain “on the Russian Federation’s side and its ‘right’ to kill and seize territories.”

Former NASA astronaut Scott Kelly tweeted at Musk on Saturday calling on him to “please restore the full functionality of your Starlink satellites.

“Defense from a genocidal invasion is not an offensive capability. It’s survival. Innocent lives will be lost. You can help. Thank you.”

However, Musk defended the decision taken by SpaceX, insisting he would not be responsible for World War III.

“You’re smart enough not to swallow media and other propaganda BS,” Musk told Kelly.

“Starlink is the communication backbone of Ukraine, especially at the front lines, where almost all other Internet connectivity has been destroyed. But we will not enable escalation of conflict that may lead to WW3,” he added.

Musk said in October last year that he could not continue to fund Starlink in Ukraine indefinitely, before reversing his decision and keeping the system in place for the foreseeable future.

Both Musk himself and SpaceX have frequently warned Starlink’s internet connection is not to be used by military engagements, and the satellite system’s terms of service state its services are “not designed or intended for use with or in offensive or defensive weaponry or other comparable end-uses.”

Authored by Simon White, Bloomberg macro strategist,

Credit spreads are looking increasingly detached to rising leverage, tight global liquidity and recession risk…

Since peaking out in October, spreads have been tightening, but this is increasingly at odds with many other indicators.

The global liquidity environment remains very tight, which pressures spreads wider. Similarly, personal savings have been rising, which at the margin is bad for companies as income is diverted away from them.

My model for credit spreads, which uses these and other inputs, shows they should move wider in the coming months.

Credit markets are also complacent on the risk of a recession. We can look at how various assets have behaved in previous ones and compare it to how they have performed in this cycle to infer an implied probability of a recession.

While the yield curve is “certain” a recession is on the way, and even rose-tinted equities see a slump occurring as better than evens, credit spreads are implying only a one-in-six chance of a downturn. But the likelihood of a recession from multiple angles suggests the risk is much higher.

Another warning is that bank-lending standards continue to tighten even as credit spreads come in. 

Often banks take their cues of credit conditions from spreads as they are a daily gauge of the credit situation. But the Fed’s Senior Loan Officer Survey, with the latest quarter’s data released yesterday, showed banks continued to tighten loan standards despite tighter spreads.

On the positive side of the ledger is a fall in firms’ debt-servicing costs as inflation has improved nominal incomes. Also, the corporate financing gap is negative, showing that companies’ internal funds are on aggregate sufficient to cover capital expenditures, reducing the need for financing. And companies were able to refinance amid robust demand for credit. But these are unlikely to be enough to counter poor liquidity and heightened recession risk.

One explanation for credit markets’ optimistic outlook comes from fevered speculation in equity option markets, with the explosive rise in 0DTE (zero days to expiry) trading a potential aggravating factor.

There has been a recent burst in activity in lending markets, with even the famed CLO behemoth, Japanese farmers’ bank Norinchukin, ready to return to the fray. But with credit looking one of the most mispriced assets, such renewed speculation is fated to end with crushing disappointment.

What started out as a Chinese spy balloon shot down February 4th over the coast of South Carolina has rapidly escalated to talk of aliens.

On Sunday, the head of NORAD (North American Aerospace Defense Command) said that the Pentagon can’t rule out that a spate of unidentified objects shot out of the sky over the past week might be extraterrestrial in nature. 

“I’ll let the intel community and the counterintelligence community figure that out. I haven’t ruled out anything,” said US Air Force General Glen VanHerck, who oversees NORAD , during a Sunday press briefing at the Pentagon. “At this point we continue to assess every threat or potential threat, unknown, that approaches North America with an attempt to identify it.”

What’s more, VanHerck says that the military has not been able to identify how the three latest objects have been able to stay aloft.

“We’re calling them objects, not balloons, for a reason,” he said.

VanHerck’s comments came after a US F-16 fighter jet shot down an ‘unidentified object’ hovering at 20,000 ft. over Lake Huron on Sunday – the third such downing in three days, and the most recent military strike in an unprecedented chain of events over North America. The object was described as an unmanned “octagonal structure” with “potential surveillance capabilities” and strings attached to it. 

On Sunday, Elon Musk tweeted that the UFO reports were nothing more than his alien “friends” stopping by, and not to worry.

Don’t worry, just some of my friends of mine stopping by …

— Elon Musk (@elonmusk) February 12, 2023

The spate of mystery objects began more than two weeks ago, after a Chinese balloon was shot down February 4th over the coast of South Carolina – meaning that the US Air Force has shot down four objects in just eight days.

VanHerck said that, unlike the Chinese spy balloon, all three UFOs gunned down over the weekend were of a similar size and speed.

He added that the since the Chinese balloon was found in late January, the US adjusted its radar so it could track slower objects. He explained that this radar adjustment, plus the heightened state of alert following the Chinese balloon, explains the frequency of UFO sightings. –Daily Mail

“With some adjustments, we’ve been able to get a better categorization of radar tracks now,” said VanHerck. “‘and that’s why I think you’re seeing these, plus there’s a heightened alert to look for this information.”

The Air Force general added that after the Chinese balloon incident, the US had to adjust its radar to be able to track slower objects – which explains the spate of new UFO sightings and takedowns. This prompted concerns that the US Air Force may have missed untold numbers of UFOs in the past.

“The last 72 hours revealed to the public what was happening for years, unidentified aircraft routinely operating over restricted US airspace,” tweeted Sen. Marco Rubio (R-FL). “This is why I pushed to take this seriously and created a permanent UAP task force two years ago.”

Of note, a June report to Congress in 2021 noted 144 sightings by US military aviators dating back to 2004 – one of which was attributed to a large, deflating balloon. The rest were beyond the government’s ability to explain without more analysis. Meanwhile, 366 additional sightings were noted in a January report from the Office of the Director of National Intelligence – though most of them were things like drones, birds, balloons or other airborne clutter.

171 objects remain officially unexplained.

“Some of these uncharacterized UAP appear to have demonstrated unusual flight characteristics or performance capabilities, and require further analysis,” reads the DNI report.

That said, undersecretary of defense for intelligence and security, Ronald Moultrie, told reporters in December that he hasn’t seen anything indicating an alien visit.

“I have not seen anything in those holdings to date that would suggest that there has been an alien visitation, an alien crash or anything like that.”

Authored by Jonathan Turley,

Below is my column in the New York Post on the growing attacks on those who are challenging the alleged abuses by the FBI and the censorship system on social media.

Here is the column:

“The Democratic Party [is] the bedfellow of international communism.”

Those words from Sen. Joe McCarthy captured the gist of the Red Scare and the use of blacklists and personal attacks to silence critics. The Democrats this week appear to have taken up the same cudgel in labeling opponents and critics Russian sympathizers and fellow travelers in opposing government involvement in a massive censorship system.

The Red Scare is back and it is going blue.

I testified this week in Congress on the Twitter Files and how they suggest what I have called “censorship by surrogate” or proxy.

The files show dozens of FBI and government employees actively seeking the censorship of citizens and others for their viewpoints. In my testimony, I warned that this was reminiscent of the McCarthy period where the FBI played a role in the establishment of blacklists for socialists, communists, and others. I encouraged Congress not to repeat its failures from the 1950s by turning a blind eye to such abuse.

This view was amplified by former Rep. Tulsi Gabbard, who became persona non grata for her anti-war sentiments in Congress. She was later labeled a “Russian asset” by Hillary Clinton, who has refused to support that scurrilous claim against a former member.

For years, the Democrats pushed a Russian collusion theory that collapsed. It was later disclosed that the Clinton campaign hid and then lied about funding the infamous Steele Dossier. Nevertheless, people like Carter Page were falsely accused of being Russian agents and critics of the investigation labeled as Russian apologists. Ironically, the FBI was warned that the dossier appeared to be the result of Russian disinformation and relied on a presumed Russian agent.

If anything, my warning of McCarthy-like attacks and measures seemed to be taken more as a suggestion than an admonition by some.

Soon after the end of the hearing, MSNBC contributor and former Sen. Claire McCaskill appeared on MSNBC to denounce the member witnesses (Sen. Chuck Grassley, Sen. Ron Johnson, and former Rep. Gabbard) as “Putin apologists” and Putin lovers.

She exclaimed, “I mean, look at this, I mean, all three of those politicians are Putin apologists. I mean, Tulsi Gabbard loves Putin.” (For the record, she also attacked me as not being “a real lawyer.”)

What was most striking is the level of attacks on those seeking an investigation into possible FBI abuses. The Democratic Party was once the greatest defender of free speech, the greatest critic of corporate power, and the greatest skeptic of the FBI. It is now opposing the investigation into the FBI’s involvement in a massive corporate-run censorship system.

In the 1950s, it was easy for politicians to avoid discussing underlying views by just labeling their opponents as fellow travelers. We are watching the same use of personal attacks today as a way to evade the troubling disclosures in the Twitter Files.

While some like McCaskill yell “Russians!” others use more modern labels, such as “conspiracy theorists.” That notably includes the FBI itself.

When criticized for the role FBI agents played in secretly targeting citizens for censorship, the FBI called critics “conspiracy theorists . . . feeding the American public misinformation.” It is something that you might expect from a pundit or politician. It is far more menacing when this attack comes from the country’s largest law enforcement agency.

Where the Hoover FBI would call dissenters “Communist sympathizers,” the Wray FBI labels them “conspiracy theorists.”

Alternatively, various Democrats portrayed anyone criticizing Twitter for censorship as supporting insurrections against the government. Member after member suggested that seeking to investigate the government’s role in censorship was to invite or even welcome another Jan. 6.

Thus, when Thomas Baker, a former FBI agent, testified on his extensive writings about changes in the FBI, he was attacked by freshman Congressman Dan Goldman (D-NY) who asked him if he had any experience investigating extremist groups. He didn’t get the answer he hoped for. When Baker responded, “Yes,” and tried to explain his prior experience, Goldman immediately cut him off and accused him of trying to sell a book.

For my part, I got off light. I was not accused of being a Russian mole or fellow traveler of insurrectionists. After responding to a question on the specific content of the files (released and confirmed by Twitter itself), Rep. Debbie Wasserman Schultz (D-Fla.), denounced me for offering “legal opinions” without actually working at Twitter. It is like saying that a witness should not discuss the content of Pentagon Papers unless one worked at the Pentagon. (By the way, the content of the Pentagon papers as well as the Twitter Files are facts. The implication of those facts are opinions. I was asked about both the factual content of the files and their constitutional implications).

It is all tragically familiar. The effort this week was to attack witnesses rather than address what appears to be the largest censorship system in the history of this country. It is, of course, ironic that those seeking to check such government-supported censorship are the ones being called Putin lovers. Putin loves censorship and likely stands in awe at the success of the left in using the FBI and corporations to regulate speech on social media.

Putin and other authoritarian countries have long feared the Internet and social media. They have struggled to gain the very level of censorship carried out by Twitter and other executives with the support of politicians and pundits.

We now know that members like Rep. Adam Schiff (D-Calif.) secretly sought censorship of critics, including a columnist. Their success would make Putin blush.

However, Democrats have insisted that freedom is tyranny.

Columnist and former Clinton Labor Secretary Robert Reich went full Orwellian when he previously dismissed calls for free speech in social media and warned that censorship is “necessary to protect American democracy.”

He then added bizarrely of uncensored social media: “That’s Musk’s dream. And Trump’s. And Putin’s. And the dream of every dictator, strongman, demagogue and modern-day robber baron on Earth. For the rest of us, it would be a brave new nightmare.”

Indeed, it is a nightmare, but a familiar one.