It was several years ago when Jeremy Grantham quietly turned from stock bull to vocal permabear, and while his market notes turned breathlessly alarmist (if only to those who were long his multi-billion fund GMO), such as this from June 2020 “Stock-market legend who called 3 financial bubbles says this one is the ‘Real McCoy,’ this is ‘crazy stuff’”, it wasn’t until early 2021 that Grantham’s warnings of an imminent crash became especially shrill… and wrong. Recall, back in January 2021, Grantham wrote that “Bursting Of This “Great, Epic Bubble” Will Be “Most Important Investing Event Of Your Lives“, while was followed by warnings of a “Spectacular” Crash In “The Next Few Months.”

Needless to say, no crash followed as the Fed and other central banks went all in on stabilizing the market, resulting in an epic year for risk assets which closed 2021 at all time highs, while GMO suffered not only steep losses but also substantial redemptions, a humiliating outcome for Grantham who had previously called the bursting of both the dot com and housing bubbles, but failed to account for just how determined the Fed is to avoid another bubble bursting.

Grantham then tried his market-timing luck once more, this time with somewhat better results, when in January 2022 he doubled down on the fire and brimstone. The GMO founder revisited a familiar theme, namely that we are currently living in a superbubble – only the fourth of the past century – and like the crash of 1929, the dot-com bust of 2000 and the financial crisis of 2008, Grantham was  “nearly certain” the bursting of this bubble has begun, sending indexes back to statistical norms and possibly further.

How much lower? The value manager saw the S&P tumbling by nearly 50% to 2,500 from its then recent all time highs of 4,800 weeks ago (he appears to enjoy forecasting 50% drops as will apparent in a second). He also predicted that the Nasdaq Composite will sustain an even bigger correction.

“I wasn’t quite as certain about this bubble a year ago as I had been about the tech bubble of 2000, or as I had been in Japan, or as I had been in the housing bubble of 2007,” Grantham told Bloomberg in a “Front Row” interview last January. “I felt highly likely, but perhaps not nearly certain. Today, I feel it is just about nearly certain.”

Well, maybe not that certain, because one year later stocks did drop, but nowhere nearly as much as Grantham predicted, with the S&P sliding 20% in 2022 and the Nasdaq losing a third. Hardly the catastrophic bursting of a superbubble which has inflated stock prices by order of magnitude.

But with Grantham, now 84 and eager to make at least one more historic call before his career is over, is not giving up and in a new paper published today titled “After a Timeout, Back to the Meat Grinder!”, the value investor is doubling down on his call from last January (and January 2021… and June 2020), and warns – again – that the popping of the bubble in US stocks is far from over and investors shouldn’t get too excited about the strong start to the year for the market.

According to Grantham, the value of the S&P 500 at the end of the year should be about 3,200, which in retrospect is well above his previous bubble-bursting forecast of 2,500.  That equals a 17% full-year drop and a 20% decline for the year from current levels. Not satisfied with his bearish forecast, Grantham hopes to outbear the likes of Mike Wilson, and believes the index is likely to spend some time below that level during 2023, including around 3,000.

“The range of problems is greater than it usually is — maybe as great as I’ve ever seen,” Grantham told Bloomberg in an interview from Boston.

“There are more things that can go wrong than there are that can go right,” he added. “There’s a definite chance that things could go wrong and that we could have basically the system start to go completely wrong on a global basis.”

Grantham, who is desperate to eventually “nail the crash” as the biggest bear, is also quietly doubling down on his apocalyptic call from a year ago and said he doesn’t discount the idea that the benchmark index could fall to around 2,000, a 50% drop from the current price, which he says would be a “brutal decline.” He is, of course, right… if the Fed were to ever allow that to happen. The problem is that Powell would step in long before the S&P dropped anywhere near there and would instruct Blackrock to buy any and all ETFs. Meanwhile, the only brutality has been the collapse in GMO’s assets which had been cut by half since 2015 through the end of 2020, as the fund kept doubling down incorrectly on ever more bearish scenarios.

The irony, of course, is that if Grantham is – finally – correct, it will only force Powell to exit from his “Fed put” hibernation and start bidding up risk assets, thus leading to even more pain for bears.

Beside Grantham’s bearishness, GMO – which is a value fund – has struggled with lackluster returns in the decade following the global financial crisis as growth stocks led the longest bull market in US stocks on record. But now, as the Federal Reserve tries to tame elevated inflation with aggressive interest-rate increases, value strategies are enjoying a revival. The GMO Equity Dislocation Strategy, which is long value equities and short those the company sees as being valued at “implausible growth expectations,” had gained nearly 15% last year through November; alas it has to more than double to regain its lost AUM.

Value has worked “quite a lot better” over the past year and has outperformed growth during that stretch. Before that, growth had a solid 10-year run, though value had been outperforming in the decades prior to that, Grantham said. “In the range of value versus growth, value is still much more attractively positioned than growth,” he explained. “It’s gone half the way back, but it’s still cheaper.” Value stocks could outperform growth ones by 20 percentage points over the next year or two, he added.

As to what might be currently attractive, Grantham says an investor could divide value stocks into four quartiles. The third group — made up of “the pretty cheap” — did well last year and is no longer super attractive. But the cheapest quartile, which didn’t have the best year, could be poised to hold up best. “It will have a very good time,” he said.

Grantham views the process of further stock market pain playing out now as similar to the popping of bubbles following other rare “explosions of investor confidence” such as in 1929, 1972 and 2000. While many are attributing last year’s slide in stocks to the war in Ukraine and the surge in inflation, or reduced growth from Covid-19 and ensuing supply chain problems, Grantham believes the market was due for a comeuppance regardless.

While the first and “easiest” leg of the bubble’s bursting is over, Grantham says that the next phase will be more complicated. Seasonal strength in the market in January and during the current period of the presidential cycle could keep the market buoyant in the early part of the year.

“Almost any pin can prick such supreme confidence and cause the first quick and severe decline,” he wrote echoing what he has said again, and again, and again. “They are just accidents waiting to happen, the very opposite of unexpected. But after a few spectacular bear-market rallies we are now approaching the far less reliable and more complicated final phase.”

For Grantham’s sake, we hope he is right because at 84, he is rapidly running out of time for the apocalypse to finally hit.

Grantham’s full note is below (pdf link).

Authored by Jonathan Turley,

Below is my column in the Hill on how the two criminal investigations over classified documents could create an unprecedented constitutional conflict in 2024. We are likely to have two candidates with their own respective special counsels. One or both could be indicted. Either way, the election could protect the winner practically from prosecution either due to a self-pardon or an internal Justice Department rule. A vote for Biden or Trump could therefore literally prove to be a “get out of jail free” card.

Here is the column:

President Biden has declared that the criminal investigation into his possession of classified material ultimately will fizzle out because “there is no ‘there’ there.” To the contrary, there obviously is a great deal “there,” enough that a special counsel was appointed to investigate a classified documents trail from a D.C. office closet to Biden’s Delaware garage.

Although the president wants Americans to look down the road past images of classified documents next to his vintage Corvette, we may be heading into one of the most bizarre, unsettling moments in our constitutional history.

There is now a distinct possibility we will have not just two leading candidates campaigning for the presidency with their own respective special counsels in tow, but two candidates who could be indicted or close to indictment at the time of the election. That would present some novel political and constitutional questions.

A great deal already has been written about comparisons of the two cases and the obvious differences. The Justice Department’s Trump investigation includes not only accusations of mishandling classified material but also of false statements and obstruction; far more documents are involved, too. Yet enough similarities exist that Justice could weigh charges in both cases, even if only misdemeanors.

Moreover, the Biden allegations are serious in their own way. The documents in Donald Trump’s possession at Mar-a-Lago were largely housed in a locked storage room with security added at the FBI’s request; there was ’round-the-clock Secret Service protection and camera surveillance. That is not ideal — but it is better than a dozen documents scattered around a closet, garage and library in different states.

There is no question of gross mishandling in Biden’s case. There is only the question of who was responsible.

If the evidence shows that Joe Biden used any of these clearly marked documents to write his book or other projects, his insistence on “inadvertent” possession will take on a more sinister meaning as an effort to deceive the public and the FBI.

Both of these investigations could easily take a year or more.

The average time of a special counsel investigation of a president is over 900 days. These two investigations should take less than the average — but they are starting in 2023, with a presidential election in 2024. Trump has already announced, and Biden is expected to do so soon.

• The one indictment scenario – One possible scenario that many Democrats are hoping for is that Biden is spared and Trump indicted. This option could be the most explosive with many in the country seeing a double standard.

• The no indictment scenario – If the investigations of both Trump and Biden extend to August 2024, the department could follow its policy of not taking actions that might affect an election. Indicting a candidate clearly falls into that category.

• The double indictment scenario – The Justice Department could also make fast work of both cases and indict both men. This option however could require a change in Justice Department policy.

This is where it gets wicked.

There has long been a debate over whether a sitting president can be indicted. While some of us believe there is no constitutional barrier to indicting a sitting president, the Justice Department has maintained that such an indictment is improper. Unless the Justice Department changed its view, it could indict Trump but might decline or delay indicting Biden. Moreover, given its policy, Justice could indicate it was holding final action on an indictment of Biden until after the election. A vote for Biden might then be seen as a way to effectively block any indictment.

Under any scenario (absent a decision to forego any charges), both candidates would face indictments or the possibility of indictment after the election. The vote literally could come down to who you want to see pardoned and who you would like to see jailed.

Even if the Justice Department elects not to indict Biden due to a lack of evidence, as opposed to a constitutional bar, it still would mean that Trump’s election could be used to negate any indictment over Mar-a-Lago. Many voters likely would view that as unequal treatment, and a self-pardon prospect could become a rallying point for many voters.

The right of a president to self-pardon is another subject of long-standing debate. Just as I believe a sitting president can be indicted, I also believe a president can pardon himself. Article II, Section 2, of the Constitution states the pardon power allows a president to “grant reprieves and pardons for offenses against the United States, except in cases of impeachment.” There is no language limiting who can be pardoned other than that it can only extend to federal crimes. Others disagree. However, it could prove the ultimate factor for the single-issue voter: Who do you want pardoned or prosecuted?

A couple of other potential wrinkles exist.

Trump’s election could result in a pardon, even a prospective pardon for federal crimes. However, he cannot pardon himself for state crimes. For example, Georgia’s Fulton County district attorney, Fani Willis, is investigating Trump over the 2020 election; the case has some major evidentiary and legal issues to overcome in any trial — but Trump could well be indicted.

If elected, Trump could clear the boards of any and all federal crimes, but he would face a trial in Georgia during his second term.

Biden could have his own pardon surprise. If his son, Hunter, is eventually indicted, Biden could follow the lead of President Clinton, who pardoned his own half-brother. It would be another abuse of the pardon power for personal benefit. Clinton, however, waited until the final days of his second term to act; if Biden was looking for a reason not to run, he might pardon his son and then withdraw from a reelection bid.

This may all sound like a constitutional version of the popular movie, “Everything Everywhere All at Once,” in which one finds oneself in some bizarre parallel universe.

In the movie, protagonist Alpha Waymond explains that “every rejection, every disappointment has led you here to this moment” — and that may be the case with the American electorate. Our duopoly of power has led us to a series of compromises that have brought us to this moment, and we may have to decide which of two candidates we most want to pardoned or prosecuted.

Back in November, when the 2Y auction hit a cycle high of 4.513%, markets knowingly nodded muttering that the bond market was agreeing with the hawkish Fed. Since then however, things haven’t gone according to plan with each auction printing at an lower and lower yield, culminating with today’s sale of 2Y paper which priced at just 4.139%, down from 4.390% in December, and the lowest since August. It also stopped through the When Issued 4.152% by 1.3bps, the third consecutive stop through which prior to December had tailed 3 of the past 5 times.

The Bid to Cover confirmed the stellar demand, jumping from 2.713 to 2.944, the highest going back all the way to the flight to safety bond market chaos of April 2020.

Finally, the internals were also phenomenal, with Indirects – or foreign buyers – awarded a whopping 65.0%, the third highest on record, and well above the recent average of 57.4%. And with Directs taking down 18.7%, it meant that Dealers were left holding on to just 16.3% which was also one of the lowest on record.

Bottom line: this was an absolutely blowout auction, and one which is clearly mocking the Fed’s “higher for longer” intention as demand for 2Y paper at well below the Fed’s market implied terminal rate of 2Y suggests that even the smartest guys in the room are convinced the Fed will be cutting quickly and aggressively as soon as the second half.

Not surprisingly, both the 10Y and the 2Y yields hit session lows after news of the stellar demand for 2Y paper hit the wires.

A ‘small number’ of documents with classified markings were discovered at former Vice President Mike Pence’s home in Indiana last week, officials confirmed Tuesday.

On January 18, Pence’s team notified the National Archives that the documents were “inadvertently boxed and transported” to the former VP’s house at the end of the Trump administration, and that Pence was “unaware of the existence of sensitive or classified documents at his personal residence,” according to his lawyer.

The findings at Pence’s residence comes as President Biden is facing mounting criticism, which had also come from Pence, over the discovery of classified materials at Biden’s old office at a Washington, D.C., think tank and at his Delaware home.

Greg Jacob, the attorney representing Pence, wrote to the Archives that Pence used outside counsel with experience handling classified documents to review records stored at his personal home after several classified documents were found at Biden’s Delaware home earlier this month. -The Hill

“Vice President Pence has directed his representatives to work with the National Archives to ensure their prompt and secure return,” wrote Jacob. “Vice President Pence appreciates the good work of the staff at the National Archives and trusts they will provide proper counsel in response to this letter.”

So – we imagine the new narrative will be that everybody does it, so it’s no big deal – and nevermind all that ‘treason’ and ‘walls are closing in’ talk when it was just Trump. We’re sure many committees will be launched to get to the bottom of the ‘classified document problem.’

Update 2 (11:15am ET): The NYSE says it is continuing to investigate the “technical issue” that caused wild stock swings at the market open Tuesday as dozens of large-cap stocks suddenly plunged or spiked during the broken opening auction.

According to the New Jersey-based New York Stock Exchange, “impacted members may consider filing for Clearly Erroneous or Rule 18 claims”  adding that “In a subset of symbols, opening auctions did not occur. The exchange is working to clarify the list of symbols.”

* * *

Update (9:52am ET). According to the NYSE, as of 9:48am, all systems are back to normal, although that is an understatement in a market where nobody knows what the correct opening price is! We are still waiting for the NYSE to give a detailed explanation of what caused this latest “broken markets” episode.

While it is still unclear what was the “technical glitch” that sent the world’s biggest companies into a multi-trillion market cap rollercoaster, Bloomberg reports that “a wave of sell orders targeting financial services stocks swept across American equity exchanges at the open of trading Tuesday, sending companies including Wells Fargo & Co. and Morgan Stanley to brief but sharp plunges from which they mostly quickly recovered.”

After closing Monday at $45.03, Wells Fargo fell as low as $38.10 before bouncing back, while Morgan Stanley plunged to $84.93 after ending at $97.13 on Monday.

That may be accurate, it’s not comprehensive as virtually every NYSE-listed stock was slammed at the open, only to rebound powerfully before tumbling once more. Indeed, as noted below, other impacted stocks included the likes of Walmart, McDonald’s and Exxon. These stocks saw drops of at least 12% before they were halted. Their moves have now rebounded to less than 1% in either direction.

Separately, at least 40 S&P 500 Index stocks were hit with trading halts. Other impacted shares included the likes of Walmart Inc. and McDonald’s Corp. These stocks saw drops of at least 12% before they were halted. Their moves have now rebounded to less than 1% in either direction.

“It’s a little concerning,” Oanda senior market analyst Ed Moya told BBG. “These are not your typical meme stock, easily manipulated companies, these are Morgan Stanley, Verizon, AT&T, these are some of the giants.”

Tuesday’s transactions occurred in New York Stock Exchange-listed securities and took place on virtually every trading platform, including ones overseen by CBOE Global Markets and private venues reporting to the Finra trade reporting facility.

The start of trading in most American stocks involves a complicated but usually routine process called the opening auction, designed to limit volatility resulting from orders for shares that pile up before the start of the regular session. In it, a computer balances out supply and demand for a particular stock by establishing an opening price that can be viewed as the level that satisfies the largest possible number of traders.

“We don’t have all the details yet, but what it looks like is that some stocks opened and were automatically or were erroneously triggered for limit up/limit down, which threw them into a halt status,” said Jonathan Corpina, senior managing partner at Meridian Equity Partners who typically works on the floor of the New York Stock Exchange.

“All of our phones are lighting up,” he said. “We’re trying to field calls from our customers and try to explain to them what happened, what’s going on and relay as much accurate information so they understand what’s happening. But as of now, things are still unfolding.”

* * *

It has been a while since we had a market-wide break.

Something snapped at exactly 9:30:00 am ET this morning when stocks opened for trading, only… they didn’t, as instead hundreds of NYSE-listed stocks were immediately halted for trading after breaching circuit breaker limits…

… which among others saw giga-caps such as Exxon, Morgan Stanley, Verizon, AT&T, Nike, and Wells Fargo tumbling as much as 11%…

… while McDonalds traded down to $236.42 before rebounding to $268.32 – a $55 billion swing in market cap in seconds – before being almost immediately halted.

While it is unclear what the “technical glitch”, as CNBC called it, in question was many stocks had abnormally large moves when stocks opened for trading, which triggered the resulting volatility halts.

It took several minutes for the circuit breakers to be lifted and for trading to return to something resembling normalcy although nobody knows if these prices are accurate or still affected by whatever glitch halted trading.

Authored by Lance Roberts via RealInvestmentAdvice.com,

From a contrarian investing view, everyone remains bearish despite a market that corrected all of last year. I polled my Twitter followers recently to take their pulse on the market.

Of the 1280 votes cast in the poll, roughly 73% of respondents anticipate the market to be lower throughout 2023. That view also corresponds with our sentiment gauge of professional and retail investor sentiment, which, while improved from the October lows, remains depressed.

More importantly, investor allocations, particularly among professional investors, remain extremely light, suggesting a much higher level of caution. The following is the 4-week moving average of the National Association of Investment Managers bullish index. While the reading of 25.04 in October coincided with the market low, the current reading of 48.16 remains bearish.

As Bob Farrell’s Rule Number 9 states:

“When all the experts and forecasts agree – something else is going to happen.

As a contrarian investor, excesses are built by everyone betting on the same side of the trade. When the market peaked in January 2022, everyone was exceedingly bullish, and no one was looking for a 20% decline. Sam Stovall, the investment strategist for Standard & Poor’s, once stated:

“If everybody’s optimistic, who is left to buy? If everybody’s pessimistic, who’s left to sell?”

Today, everyone remains bearish, suggesting the possibility of the market doing something no one expects.

The Art Of Contrarianism

As we have often discussed, one of the investors’ most significant challenges is going “against” the prevailing market “herd bias.” However, historically speaking, contrarian investing often proves to provide an advantage. One of the most famous contrarian investors is Howard Marks, who once stated:

“Resisting – and thereby achieving success as a contrarian – isn’t easy. Things combine to make it difficult; including natural herd tendencies and the pain imposed by being out of step, particularly when momentum invariably makes pro-cyclical actions look correct for a while.

Given the uncertain nature of the future, and thus the difficulty of being confident your position is the right one – especially as price moves against you – it’s challenging to be a lonely contrarian.”

As noted, a majority of investors remain bearish. There are certainly ample reasons to BE bearish:

1. The Fed is remaining aggressive on monetary policy.

2. Central banks are reducing liquidity to markets.

3. Inflation remains problematic.

4. Earnings remain elevated.

5. The economy is slowing.

6. Consumers are running out of savings.

We certainly agree with the more dismal outlook and continue to suggest that investors should be more cautious in their portfolio allocations. However, this is also the point where investors make the most mistakes. Emotions make them want to avoid the risk of loss.

Given that many investors have never witnessed a “bear market,” the current bearing sentiment is unsurprising. The increased price volatility, and subsequent decline in prices, created a substantially higher level of instability. That instability creates “fear” and drives investors to the behavioral bias of “loss aversion.”

That increased volatility weighs on investor sentiment leading to poor investment decision-making and, ultimately, poor outcomes.

However, if the most fundamental premise of investing is to “buy when everyone is fearful,” investors may again be missing the contrarian opportunity.

With the market negatively positioned, the contrarian trade is an expectation of the unexpected.

• What if the markets have discounted an economic slowdown?

• What if earnings remain stronger than currently expected?

• Could the Fed reverse monetary policy?

• Have valuations declined enough?

The fundamentally bearish arguments of valuations, earnings, a Fed policy mistake, and a recession are certainly viable outcomes.

However, given that “everyone” is already expecting those outcomes, what happens if something else occurs?

Navigating A Contrarian Trade

Everyone is so bearish the markets could respond in a manner no one expects.

There are plenty of reasons to be very concerned about the market over the next few months. Given the market leads the economy, we must respect the market’s action today for potentially what it is telling us about tomorrow. Therefore, there are some actions we can take to navigate for whatever path the market chooses.

1. Move slowly. There is no rush to make dramatic changes. Doing anything in a moment of “panic” tends to be the wrong thing.

2. If you are overweight equities, DO NOT try and fully adjust your portfolio to your target allocation in one move. Again, after significant declines, individuals feel like they “must” do something. Think logically about where you want to be and use the rally to adjust to that level.

3. Begin by selling laggards and losers. These positions were dragging on performance as the market rose, and they led on the way down.

4. Add to sectors, or positions, that are performing with or outperforming the broader market if you need risk exposure.

5. Move “stop-loss” levels up to recent lows for each position. Managing a portfolio without “stop-loss” levels is like driving with your eyes closed.

6. Be prepared to sell into the rally and reduce overall portfolio risk. You will sell many positions at a loss simply because you overpaid for them to begin with. Selling at a loss DOES NOT make you a loser. It just means you made a mistake.

7. If none of this makes sense to you, please consider hiring someone to manage your portfolio. It will be worth the additional expense over the long term.

Just remember:

“In good times, skepticism means recognizing the things that are too good to be true; that’s something everyone knows. But in bad times, it requires sensing when things are too bad to be true. People have a hard time doing that.

The things that terrify other people will probably terrify you too, but to be successful, an investor has to be a stalwart. After all, most of the time the world doesn’t end, and if you invest when everyone else thinks it will, you’re apt to get some bargains.“

Follow your process.

The Ukrainian government on Tuesday confirmed the resignation of multiple high ranking officials amid large-scale corruption allegations, in what’s being called the biggest mass resignation and graft scandal since the Russian invasion began.

Some dozen officials have quit their posts after a huge political shake-up over allegations and probes into cases ranging from bribery, to mismanagement of aid funds for purchasing food, to embezzlement, to driving expensive cars while common people suffer under wartime conditions.

A top presidential adviser and four deputy ministers – among these two defense officials, along with five regional governors were forced out of their posts. And among the regional governors to step down included officials overseeing regions which have seen intense fighting, including the Zaporizhzhia and Kherson regions, where Russian forces have lately reported gains.

In reference to the announcement by a senior government official, Oleg Nemchinov, international reports detail the following list: 

• Deputy Prosecutor General Oleskiy Symonenko

• Deputy Minister for Development of Communities and Territories Ivan Lukeryu

• Deputy Minister for Development of Communities and Territories Vyacheslav Negoda

• Deputy Minister for Social Policy Vitaliy Muzychenk

• And the regional governors of Dnipropetrovsk, Zaporizhzhia, Kyiv, Sumy and Kherson

And separately, “the defense ministry had earlier announced the resignation of deputy minister Vyacheslav Shapovalov, who was in charge of the army’s logistical support, on the heels of accusations it was signing food contracts at inflated prices.” 

In this case regarding the food contracts, Shapovalov is accused of signing a deal with an unknown, shady firm. In his role as deputy defense minister, his is the most notable and visible resignation. Crucially he would have had no small part in overseeing the billions of dollars flowing from the pockets of US and European taxpayers as authorized defense aid.

He purchased military rations at inflated prices in what appears a scheme to line the pockets of contractors, and potentially involving kickbacks to himself.

Deputy Minister of Defense Vyacheslav Shapovalov has resigned over to the food procurement scandal. https://t.co/kP3U8CjHd2

— Christopher Miller (@ChristopherJM) January 24, 2023

While the defense ministry is still trying to downplay it as a “technical error” – Politico reviews of the details to the scandal: 

An exposé from the Ukrainian news website ZN.UA revealed last week that the defense ministry purchased overpriced food supplies for its troops. For instance, the ministry bought eggs at 17 hryvnias per piece, while the average price of an egg in Kyiv is around 7 hryvnias. According to ZN.UA, a contract for food procurement for soldiers in 2023 amounted to 13.16 billion hryvnias (€328 million).

This is two to three times higher than current rates for such food items, reports say. Shapovalov’s resignation letter indicated he’s stepping down so as “not to pose a threat to the stable supply of the Armed Forces of Ukraine as a result of a campaign of accusations related to the purchase of food services.”

There’s also deputy head of the Zelensky administration Kyrylo Tymoshenko, who stands accused of living a lavish wartime lifestyle. Many current mainstream media reports on Tuesday are burying some of the key verified details. For example, BBC writes simply that “Tymoshenko was implicated in several scandals during his tenure, including in October last year when he was accused of using a car donated to Ukraine for humanitarian purposes.”

But starting in early December local Ukrainian outlets, angered at the posh lifestyle of Ukrainian leaders at a moment tens of millions are without power amid Russian aerial bombardment of the nation’s power grid, began confirming that Tymoshenko drove high-end sports cars in and out of the capital, to and from mansions which typically range in cost from $10,000 to $25,000 per month. 

Below are photos published by The New Voice of Ukraine, republished in Yahoo News, in early December of last year, showing Tymoshenko frequently behind the wheel of a shiny new Porsche Taycan…

One outlet published a photo series entitled Not the “martial law” of Kyrylo Tymoshenko, deputy head of Ukraine’s Office of the President

US taxpayer dollars at work in Ukraine…

As another example of Western MSM seeking to downplay or soften this latest wave of graft-related forced resignations, the AFP writes, “Ukraine has long suffered endemic corruption, including among the political elite, but efforts to stamp out graft have been overshadowed by Moscow’s full-scale war that began in February.” And yet officials like Tymoshenko were spotted around Kiev and oligarchs’ neighborhoods driving luxury sports cars for months throughout the war.

Additionally, there’s this laughable and embarrassing line out of the AFP report: “Kyiv’s Western allies, who have allocated billions of dollars in financial and military support, have been pushing for anti-corruption reforms for years, sometimes as a precondition for aid.”

From a government supposedly “pushing anti-corruption reforms for years” to over $100 billion in US defense and foreign aid being pledged to Kiev’s coffers over the past year… to now this from within the heart of the Zelensky administration:

Kyrylo Tymoshenko, deputy head of the office of the president of Ukraine, confirms he submitted his resignation to Zelensky. In his IG post he thanks Ze for “the opportunity to do good deeds every minute of every day,” and many others including his family and Ukrainian officials. pic.twitter.com/AwAiH8txMb

— Christopher Miller (@ChristopherJM) January 24, 2023

It doesn’t stop at posh and expensive cars, but the controversy has even extended to luxury vacations abroad as Ukrainians suffer the deprivations of war at home. “The departure of Symonenko, a deputy prosecutor general, comes after media reports that he spent a holiday in Spain this winter, reportedly using a car belonging to a Ukrainian businessman.” The government has as a result now reportedly barred top officials from vacationing abroad as a result of the scandal.

Just prior to the wave of resignations, another official named Vasyl Lozynskiy was accused of receiving bribes to “facilitate” the purchase of generators at greatly hiked-up prices. Crucially, Lozynskiy as Deputy Minister of Infrastructure and Communities Development would have also been directly involved in overseeing how billions of dollars in Western humanitarian and infrastructure assistance gets doled out.

Commenting on this, mainstream media is now belatedly acknowledging a fact that’s long been well-known, but which would get a person ‘canceled’ in public discourse if they dared pointed it out:

“Transparency International ranked Ukraine 122 out of 180 in its corruption ranking for 2021,” the AFP now writes (the second most corrupt in Europe, with Russia the most at 136.)

And now Ukraine’s Defense Minister Oleksii Reznikov is under scrutiny related to the growing probe and scandal. Meanwhile, as news of the widening scandal hits world headlines…

Addressing a Chambers of Commerce meeting in Boca Raton today, Zelensky thanks BlackRock, JP Morgan, Goldman Sachs, and others for their support of Ukraine. Adds that sending Ukraine heavier weapons, like Abrams tanks, represents a “big business” opportunity for US corporations pic.twitter.com/N1h8OVECLt

— Michael Tracey (@mtracey) January 24, 2023

By John Kemp, senior market analyst

Portfolio investors have piled back into petroleum futures and options at the fastest rate for more than two years as concerns about a global business cycle downturn have eased.

Hedge funds and other money managers purchased the equivalent of 89 million barrels in the six most important petroleum contracts over the seven days ending on Jan. 17.

Purchasing was the fastest since November 2020 (shortly before the first successful coronavirus vaccine trials were announced) and before that April 2020 (when the first lockdowns started to be eased). The wave of buying was led by crude (+78 million barrels), especially Brent (+55 million), with smaller buying in NYMEX and ICE WTI (+23 million).

Total Brent positions climbed to 212 million barrels (44th percentile for all weeks since 2013) up from 157 million (22nd percentile) on Jan. 10 and a recent low of just 89 million (4th percentile) on Dec. 13.

Bullish long positions outnumbered bearish short ones in Brent by a ratio of 5.30:1 (63rd percentile) up from 3.07 (28th percentile) on Jan. 10 and 1.95 (6th percentile) on Dec. 13.

The increase in investors’ Brent positions was the largest since August 2018 and the sixth-largest out of 514 weeks since the time series began in 2013.

The sudden turn around seems to have been driven by a combination of low initial positioning and a sudden increase in confidence about the outlook for the global economy and oil consumption. Recent inflation data have shown the rate of price increases is moderating, which has raised hopes for an early peak in the interest rate cycle.

With gas and electricity prices declining in recent weeks, some major forecasters now expect the euro zone as well as the United States to avoid a formal recession in 2023. China also appears to be pressing ahead with re-opening the economy after three years of intermittent and disruptive lockdowns.

Given the speed of transmission, the current infection wave is likely to be completed by the end of February or early March. By April, there is likely to be a very large increase in domestic and international passenger travel by air, rail and road, driving a large increase in fuel consumption.

China’s re-opening industrial economy is also likely to stimulate domestic diesel consumption and spill-over stimulus to other economies in Asia.

Ironically, the biggest risk to the economy and oil consumption is that the economic revival rekindles inflationary pressures and forces the major central banks to persist in raising interest rates longer and higher.

The battle over Twitter is often made to appear complex and chaotic, but it can all be boiled down to a simple dichotomy – It’s about the people who demand censorship in favor of the establishment narrative vs. the people who want free speech and fair rules applied to everyone equally. 

Everything else is noise and distraction.

The complications arise when we try to define free speech when it comes to social media.  Private companies are not subject to many legal boundaries related to free speech rights.  This is an argument that the political left and government representatives made constantly during the massive purge of conservative and liberty oriented accounts by Big Tech companies since 2016.  And, as we saw with Twitter previous to Elon Musk’s takeover, governments took full advantage of this legal loophole in order to silence people using social media websites as middlemen.  

The ongoing release of the Twitter Files proves beyond a shadow of a doubt that collusion between Big Tech and governments for the sake of censorship is a reality.  In America, at least, this is a constitutional no-no.  The fact that politicians and agencies like the FBI were actively seeking out and targeting ideological opponents and having them silenced on Twitter is a direct violation of the 1st Amendment and these people should be subject to prosecution (the FBI even shelled out at least $3 million to Twitter for services rendered). 

Prosecution might never happen, but at least the evidence is undeniable today after years of the public being lied to.

The reality that Twitter was acting as an enforcement agent for government censorship around the world tells us exactly why so many establishment officials have been up in arms over Musk’s purchase of the platform.  Until now, every single major Big Tech company has been operating in lock-step with the establishment narrative.  People couldn’t even talk about Hunter Biden’s laptop, let alone talk about the inconvenient facts surrounding “climate change” or the covid mandates and vaccines.

This is a dynamic that elitists would still like to keep in place, and they are looking to use international trade rules as a means to pressure Musk into conforming. 

EU Commissioner for Values and Transparency Věra Jourová makes a statement from the frozen doorstep of Davos arguing that Twitter is subject to EU rules for preventing “harm to society”.

“The time of the Wild West is over,” Jourova told EuroNews.

“We will have the Digital Services Act [DSA]. We will have the Code of Practice as a part of this legislation.”

“So, after Mr Musk took over Twitter with his ‘freedom of speech absolutism,’ we are the protectors of freedom of speech as well,” she added.

“But at the same time, we cannot accept, for instance, illegal content online and so on. So, our message was clear: we have rules which have to be complied with, otherwise there will be sanctions.”

Who is Věra Jourová to determine what type of speech is harmful to society? She’s a bureaucrat who has long insisted that “hate speech” laws utilized in the EU should be instituted in the US.  In other words, she’s nobody.  

But two very important conclusions can be derived from her statements here. 

• First, she is essentially admitting that the EU Commission was working directly with the previous Twitter leadership to censor the public in a bid to control their behavior. 

• Second, establishment bureaucrats overseas assume that they should have the power to dictate the policies of private media companies in the US when it comes to communication. 

It should be noted that these same bureaucrats were defending Twitter operations as a private company only a year ago (as long as company policies fell in line with government messaging).  As soon as Twitter started to allow more free speech, suddenly its operations as a private company became an international problem. 

Again, the conflict is about one question – Should people be allowed say what they want and share the information that they want within the confines of constitutional law?  For those that believe the answer is no, we have to then ask “Why?”  What about free speech is so threatening to them?  Can mere speech really do damage to society? Is this really about public safety?  Or, is it about power, and the means to lie to the public while removing their ability to contradict?       

The United States is once again putting pressure on China over its alleged behind the scenes assistance to Russia as it executes the war in Ukraine.

“The Biden administration has confronted China’s government with evidence that suggests some Chinese state-owned companies” may be providing assistance, Bloomberg reports, while seeking to “ascertain if Beijing is aware of those activities, according to people familiar with the matter.”

The sources cited in the report said the support involved non-lethal military aid and economic assistance that “stops short of wholesale evasion of the sanctions regime” put in place by the US and its allies on Russia. 

It’s believed that non-lethal equipment such as helmets and flak jackets are being transferred, which US officials say is still “concerning” – and Secretary of State Tony Blinken is expected to inquire about the issue when he travels to China within coming weeks.

Washington has since the start of the Russian invasion worried that Moscow and Beijing’s mutual declaration of having a “friendship without limits” at the Putin-Xi summit on Feb. 4, 2022 will turn into supplying the Russian war machine militarily. 

There have even been suggestions coming out of US officials that President Xi knew about the invasion beforehand, something Beijing as firmly denied. The timing of Putin’s cozy visit with this Chinese counterpart, having come just weeks before he ordered the Ukraine invasion, has long raised eyebrows.

The issue of potential sanctions-violating items sent to Russia by state-owned companies has been raised directly with top Chinese government officials in the foreign ministry. “The trend is worrying enough that US officials have raised the matter with their Chinese counterparts and warned about the implications of supplying material support for the war,” Bloomberg details.

But then even if the Chinese government is shown to have had direct knowledge of its state-owned firms sanctions-busting activities, the question remains of how far the Biden administration is will to go in terms of punishment. 

If Russia loses, China is next on the US list https://t.co/hYbLbAaYnI

— Elijah J. Magnier 🇪🇺 (@ejmalrai) January 18, 2023

The Bloomberg report highlights the dilemma in the following: “And if Biden and his advisers determined China’s government was involved in or tacitly accepted the actions of those state-owned enterprises, they would be forced to decide how much to push back.”

And further: “That could risk opening a whole new area of dispute at a time when the US has sought to balance its desire for stabilized ties with Beijing against moves to limit Chinese access to high-end mircochips and confront China over what it sees as a more aggressive posture toward Taiwan.”

The Kremlin potentially being able to tap China as a reliable military supplier would have huge repercussions for its war effort especially given the widespread assumption that Russia is fast depleting its artillery reserves. A large, powerful secret backer which could keep up fresh supply would be a game-changer, also at a moment the Ukrainian side is desperate for more from its Western backers. US intelligence has lately eyed North Korea too as a culprit in aiding the Russian invasion via equipment and ammo. The US has recently alleged Pyongyang is arming the Wagner private military firm in particular.