Authored by Simon White, Bloomberg macro strategist,

China’s money growth data for February released overnight modestly disappointed to the downside.

Real M1 growth, which is one of the best cyclical leading indicators in China, has dipped lower again, driven by the rise in CPI from -0.7% to 0.8% in February.

Markets are still waiting for a decisive turn in the data, although on a three-month smoothed basis the trend is gingerly picking up.

Crude oil prices were set for a weekly gain of about 4% after the International Energy Agency became the latest forecaster to suggest oil demand might turn out to be stronger than previously expected this year.

The IEA said Thursday that it now expects oil demand this year to grow by 1.3 million bpd, up from 1.2 million bpd last month. The agency cited maritime transport disruptions due to the Houthi attacks in the Red Sea that are adding demand for fuels.

The IEA also revised its supply forecast, but downwards, according to Irina Slav of OilPrice. It now expects additional supply this year at 800,000 bpd. As a result, the forecast, which last month said the oil market would.

The agency noted, however, that lukewarm economic growth would continue to act as a headwind for prices even as other agencies such as the IMF revised their global GDP growth outlook upwards.

A series of fresh drone attacks by Ukraine on Russian refineries also contributed to the price rally this week, especially after the energy ministry said these attacks had led to a 1.5% decline in fuel exports in February. There were drone attacks on refineries in Russia last month as well.

The latest weekly inventory figures from the United States were also bullish for prices, featuring sizeable drawdowns in fuel inventories that suggested stronger demand.

“Demand is staying high, while supplies are getting tighter, particularly on the fuel side. The refining margins are also very strong and a positive for crude demand,” Reuters quoted BOK Financial senior VP of trading Dennis Kissler as saying.

As a result of the rally, which brought Brent crude to over $85 per barrel on Thursday, traders started taking profits, eventually bringing prices lower. Even so, the international benchmark was trading above $85 per barrel in midmorning trade in Asia today. West Texas Intermediate crossed the $80 threshold earlier in the week and was trading at over $81 per barrel in mid-morning trade in Asia.

Meanwhile, gasoline is now trading at $3.44, the highest price since Octover and effectively unchanged on the year, and in the a ominous development for the Biden admin, wholesale gasoline prices suggest a big jump in retail gasoline is imminent.

Authored by Jonathan Turley,

We have previously discussed the unrelenting attacks by Canadian Prime Minister Justin Trudeau and his allies on free speech. There has been a steady criminalization of speech, including even jokes and religious speech, in Canada. Now, the Canadian parliament is moving toward a new change that would allow the imposition of life imprisonment on those who post views deemed supportive of genocide. With a growing movement calling Israel’s war in Gaza “genocide,” the potential scope of such a law is readily apparent. That appears to be its very draw for anti-free speech advocates in the country.

The Online Harms Act, or Bill C-63 increases the potential penalties from five years to life imprisonment. It also increases the penalty for the willful promotion of hatred (a dangerously ill-defined crime) from two years to five years. The proposed changes constitute a doubling down on Canada’s commitment to reducing free speech for citizens despite criticism from many in the civil liberties community.

There is also a chilling option for house arrest if a judge believes a defendant “will commit” an offense. In other words, if a judge thinks that a citizen will be undeterred and try to speak freely again.

Justice Minister Arif Virani employed the same hysteria to convince citizens to surrender their freedoms to the government. He expressed how terrified he was with the potential of free speech, stating that he is “terrified of the dangers that lurk on the internet for our children.”

It is not likely to end there.

Today the rationale is genocide. However, once the new penalties are in place, a host of other groups will demand similar treatment for those with opposing views on their own causes. 

This law already increased the penalties for anything deemed hateful speech.

The law comes after Canada blocked a Russian dissident from becoming a citizen because of her violation of Russian anti-free speech laws.

In a telling act, the government said that the same conduct (i.e., free speech) could be a crime in Canada. 

Indeed, it may now be punished even more harshly.

By Bas van Geffen of Rabobank

In the original song, Rammstein sings about the passing of time, ‘Tick tack’, and fighting ageing with plastic surgery, ‘Zick zack’. However, with some new lyrics the key theme of the song perfectly encapsulates recent news. TikTok, time’s ticking. Snip, snip, the US government forces ByteDance to cut the social network up and divest the US part. If they don’t, the company faces a nationwide ban.

The House of Representatives passed the bill earlier this week; when the Senate will take a vote is yet unknown. Nonetheless, several tech companies are already said to be lining up for the US part of TikTok, and former Treasury Secretary Mnuchin has now also expressed his interest.

This seems to make for a great business model. Here’s the general idea:

1. Take any (successful) foreign company that could remotely pose a national security risk.
2. Force the company to divest the part of the firm that operates in the US, or threaten to ban it.
3. Set up a SPAC that can acquire said divestment.
4. Repeat.

This may sound like a bad joke. But if you think about it, China has been doing something similar for decades. Foreign companies that want access to the vast Chinese market are often forced to set up joint ventures with local firms, transferring technological know-how in the process. So why wouldn’t the US, or indeed the West more broadly, do something similar?

So far, the West has focused more on incentives, such as the CHIPS act in the US and the Chips Act in the European Union, to bring more critical production processes back home. But, as the TikTok bill illustrates, the clearer the (perceived) security risk, the bigger the urgency to use other means. Algorithms and social media tick two important boxes. That, however, can easily become a sliding scale.

Time’s also ticking down for negative interest rates policy in Japan. And probably a bit faster after today. Rengo, a federation of labour market unions, announced that it’s members have secured annual pay increases of 5.28% so far. That’s a significant increase from 3.8% last year, and the highest rate in more than three decades.

Japan’s central bankers have tied the timing of a policy change to wage developments, with markets split between a move this month or in April. Today’s wage data will probably be the final push that policymakers needed to vote in favor of a rate hike at next week’s meeting already. Such move couldn’t be more symbolic – the world is now really leaving behind the “low rates forever” era.

That said, we expect the Bank of Japan to remain cautious when it starts removing some of its policy accommodation. Subsequent tightening will probably only come gradually. Jane Foley, our Head of FX Strategy, notes that such cautious rhetoric could still expose JPY to ‘sell the news’ risk, even if the bank announces a rate hike on Tuesday. Over the months ahead we expect downside in USD/JPY to be moderate. We have 140 as a our 12 month target.

While inflation expectations have normalized, based on UMich’s survey…

Source: Bloomberg

…consumer confidence overall disappointed in preliminary March data…

Source: Bloomberg

And while both Republicans and Democrats saw confidence improve, Independents were notably less confident…

Source: Bloomberg

Still, overall, a sizable minority of consumers continue to express concerns over the impact of high prices.

About 24% of consumers spontaneously mentioned food prices during interviews, up from 17% last month and the highest since July 2022. Sentiment for these consumers was a considerable 20 index points below the sentiment of those who did not mention food prices. Furthermore, approximately 36% of consumers blamed high prices for eroding their living standards,

Concerns have been particularly prevalent among lower- and middle-income consumers, who are also much less likely to expect real income gains in the year ahead than their higher-income counterparts.

Shares of Polish retailer LPP, trading in Warsaw, are down more than 30% in mid-day trading after activist short seller Hindenburg Research claimed the company “masked a fake Russia ‘sell-off’ using front entities and encrypted barcodes”. 

LPP is a fashion retailer based in Poland that lays claim to being the largest fashion company in Central and Eastern Europe, the report says. Until Russia invaded Ukraine in February 2022, Russia was LPP’s biggest international market, generating ~19.2% of revenue from 553 stores, it added. 

But then Hindenburg alleged a sell off of the company’s Russia division – prompted by sanctions related to the Russia/Ukraine conflict – was a “sham”. 

“On April 28 2022, LPP announced plans to distance itself from Russia by divesting its Russia division. A deal progressed rapidly: Weeks later, on May 19, 2022, it announced it had concluded negotiations with an unnamed buyer, finalizing a sale on June 30, 2022,” the short seller wrote. “Despite saying it lost ~20% of revenues from divesting its Russian operations, LPPs total revenue still remarkably grew 13% overall in FY 2022/23. Reported revenue across markets excluding Russia was up 40.5% year-on-year.”

“We believe LPP was able to post these remarkable results because its divestment of its Russia business has been a complete sham,” the report says, detailing a trail of shell companies and suspect transactions. 

Hindenburg wrote that a former manager described LPP CEO’s approach as he “didn’t give a f*ck about some war between Russia and Ukraine. This [war] is just temporary.”

Among other things, Hindenburg used secret shoppers in Russia, interviews and decoded barcodes as ways to investigate the company. 

“Russian in-house product codes were an exact match for the product codes in LPP´s Polish catalogue,” the short seller wrote. “Overall, we believe LPP devised an elaborate sham ‘divestment’ to continue making money in Russia despite the devastating war, while trying to deceive investors and consumers in Poland, Ukraine, and its other key markets.”

Shares were briefly suspended in Poland down almost 30% before re-opening and plunging further, falling close to 35% at one point. 

LPP responded by denying the accusations. “The group has full control over the situation,” it said in its response. It told Reuters: “The report prepared by Hindenburg Research is part of an organised disinformation attack that has been prepared for five months and is aimed at reducing the share price of the LPP Group.”

By Autumn Spredemann of The Epoch Times

Tens of thousands of illegal immigrants are flooding into U.S. hospitals for treatment and leaving billions in uncompensated health care costs in their wake.

The House Committee on Homeland Security recently released a report illustrating that from the estimated $451 billion in annual costs stemming from the U.S. border crisis, a significant portion is going to health care for illegal immigrants.

With the majority of the illegal immigrant population lacking any kind of medical insurance, hospitals and government welfare programs such as Medicaid are feeling the weight of these unanticipated costs.

Apprehensions of illegal immigrants at the U.S. border have jumped 48 percent since the record in fiscal year 2021 and nearly tripled since fiscal year 2019, according to Customs and Border Protection data.

Last year broke a new record high for illegal border crossings, surpassing more than 3.2 million apprehensions.

And with that sea of humanity comes the need for health care and, in most cases, the inability to pay for it.

In January, CEO of Denver Health Donna Lynne told reporters that 8,000 illegal immigrants made roughly 20,000 visits to the city’s health system in 2023.

The total bill for uncompensated care costs last year to the system totaled $140 million, said Dane Roper, public information officer for Denver Health. More than $10 million of it was attributed to “care for new immigrants,” he told The Epoch Times.

Though the amount of debt assigned to illegal immigrants is a fraction of the total, uncompensated care costs in the Denver Health system have risen dramatically over the past few years.

The total uncompensated costs in 2020 came to $60 million, Mr. Roper said. In 2022, the number doubled, hitting $120 million.

He also said their city hospitals are treating issues such as “respiratory illnesses, GI [gastro-intenstinal] illnesses, dental disease, and some common chronic illnesses such as asthma and diabetes.”

“The perspective we’ve been trying to emphasize all along is that providing healthcare services for an influx of new immigrants who are unable to pay for their care is adding additional strain to an already significant uncompensated care burden,” Mr. Roper said.

He added this is why a local, state, and federal response to the needs of the new illegal immigrant population is “so important.”

Colorado is far from the only state struggling with a trail of unpaid hospital bills.

Dr. Robert Trenschel, CEO of the Yuma Regional Medical Center situated on the Arizona–Mexico border, said on average, illegal immigrants cost up to three times more in human resources to resolve their cases and provide a safe discharge.

“Some [illegal] migrants come with minor ailments, but many of them come in with significant disease,” Dr. Trenschel said during a congressional hearing last year.

“We’ve had migrant patients on dialysis, cardiac catheterization, and in need of heart surgery. Many are very sick.”

He said many illegal immigrants who enter the country and need medical assistance end up staying in the ICU ward for 60 days or more.

A large portion of the patients are pregnant women who’ve had little to no prenatal treatment. This has resulted in an increase in babies being born that require neonatal care for 30 days or longer.

Dr. Trenschel told The Epoch Times last year that illegal immigrants were overrunning healthcare services in his town, leaving the hospital with $26 million in unpaid medical bills in just 12 months.

ER Duty to Care

The Emergency Medical Treatment and Labor Act of 1986 requires that public hospitals participating in Medicare “must medically screen all persons seeking emergency care … regardless of payment method or insurance status.”

The numbers are difficult to gauge as the policy position of the Centers for Medicare & Medicaid Services (CMS) is that it “will not require hospital staff to ask patients directly about their citizenship or immigration status.”

In southern California, again close to the border with Mexico, some hospitals are struggling with an influx of illegal immigrants.

American patients are enduring longer wait times for doctor appointments due to a nursing shortage in the state, two health care professionals told The Epoch Times in January.

A health care worker at a hospital in Southern California, who asked not to be named for fear of losing her job, told The Epoch Times that “the entire health care system is just being bombarded” by a steady stream of illegal immigrants.

“Our healthcare system is so overwhelmed, and then add on top of that tuberculosis, COVID-19, and other diseases from all over the world,” she said.

A newly-enacted law in California provides free healthcare for all illegal immigrants residing in the state. The law could cost taxpayers between $3 billion and $6 billion per year, according to recent estimates by state and federal lawmakers.

In New York, where the illegal immigration crisis has manifested most notably beyond the southern border, city and state officials have long been accommodating of illegal immigrants’ healthcare costs.

Since June 2014, when then-mayor Bill de Blasio set up The Task Force on Immigrant Health Care Access, New York City has worked to expand avenues for illegal immigrants to get free health care.

“New York City has a moral duty to ensure that all its residents have meaningful access to needed health care, regardless of their immigration status or ability to pay,” Mr. de Blasio stated in a 2015 report.

The report notes that in 2013, nearly 64 percent of illegal immigrants were uninsured. Since then, tens of thousands of illegal immigrants have settled in the city.

“The uninsured rate for undocumented immigrants is more than three times that of other noncitizens in New York City (20 percent) and more than six times greater than the uninsured rate for the rest of the city (10 percent),” the report states.

The report states that because healthcare providers don’t ask patients about documentation status, the task force lacks “data specific to undocumented patients.”

Some health care providers say a big part of the issue is that without a clear path to insurance or payment for non-emergency services, illegal immigrants are going to the hospital due to a lack of options.

“It’s insane, and it has been for years at this point,” Dana, a Texas emergency room nurse who asked to have her full name omitted, told The Epoch Times.

Working for a major hospital system in the greater Houston area, Dana has seen “a zillion” migrants pass through under her watch with “no end in sight.” She said many who are illegal immigrants arrive with treatable illnesses that require simple antibiotics. “Not a lot of GPs [general practitioners] will see you if you can’t pay and don’t have insurance.”

She said the “undocumented crowd” tends to arrive with a lot of the same conditions. Many find their way to Houston not long after crossing the southern border. Some of the common health issues Dana encounters include dehydration, unhealed fractures, respiratory illnesses, stomach ailments, and pregnancy-related concerns.

“This isn’t a new problem, it’s just worse now,” Dana said.

Medicaid Factor

One of the main government healthcare resources illegal immigrants use is Medicaid.

All those who don’t qualify for regular Medicaid are eligible for Emergency Medicaid, regardless of immigration status. By doing this, the program helps pay for the cost of uncompensated care bills at qualifying hospitals.

However, some loopholes allow access to the regular Medicaid benefits. “Qualified noncitizens” who haven’t been granted legal status within five years still qualify if they’re listed as a refugee, an asylum seeker, or a Cuban or Haitian national.

Yet the lion’s share of Medicaid usage by illegal immigrants still comes through state-level benefits and emergency medical treatment.

A Congressional report highlighted data from the CMS, which showed total Medicaid costs for “emergency services for undocumented aliens” in fiscal year 2021 surpassed $7 billion, and totaled more than $5 billion in fiscal 2022.

Both years represent a significant spike from the $3 billion in fiscal 2020.

An employee working with Medicaid who asked to be referred to only as Jennifer out of concern for her job, told The Epoch Times that at a state level, it’s easy for an illegal immigrant to access the program benefits.

Jennifer said that when exceptions are sent from states to CMS for approval, “denial is actually super rare. It’s usually always approved.”

She also said it comes as no surprise that many of the states with the highest amount of Medicaid spending are sanctuary states, which tend to have policies and laws that shield illegal immigrants from federal immigration authorities.

Moreover, Jennifer said there are ways for states to get around CMS guidelines. “It’s not easy, but it can and has been done.”

The first generation of illegal immigrants who arrive to the United States tend to be healthy enough to pass any pre-screenings, but Jennifer has observed that the subsequent generations tend to be sicker and require more access to care. If a family is illegally present, they tend to use Emergency Medicaid or nothing at all.

The Epoch Times asked Medicaid Services to provide the most recent data for the total uncompensated care that hospitals have reported. The agency didn’t respond.

Continue reading over at The Epoch Times

Another day, another downward-ly revised dataset…

In today’s episode of ‘shit you believed in the past is not real at all’, US Industrial Production in January was revised from a 0.1% decline to  0.5% decline. That is the 10th monthly revision lower in the last 11 months (and 14th of the last 17)…

Source: Bloomberg

Industrial Production rose 0.1% MoM in February (from that revised lower print), leaving the YoY change in IP at -0.23%…

Source: Bloomberg

Capacity Utilization was flat at 78.25% in February…

Source: Bloomberg

On the pure manufacturing side, production rose 0.8% MoM, but that – again – was from a big downardly revised January (from -0.5% MoM to -1.1% MoM)…

Source: Bloomberg

Just another endless stream of downward revisions…

Source: Bloomberg

How long before the ‘soft’ survey data catches up to the hard reality of the downwardly revised production data…

Source: Bloomberg

All the downward revisions must be weighing on GDP forecasts.

Via City A.M.,

• Most investors with supposedly sustainable ISAs unknowingly support banks funding fossil fuels.

• Many believe sustainable funds cannot include fossil fuel companies, highlighting a lack of understanding.

• Young investors are more skeptical of greenwashing practices by financial institutions.

A majority of investors that picked their ISA based on sustainability credentials actually have their cash in providers classified as ‘worst’ for their environmental impact, new research has revealed.

Analysis from Triodos Bank UK found that investors were failing to understand the sustainability implications of where they put their money.

The research found that a majority of people (55 percent) who have a stocks and shares ISA with a provider classified as the worst on sustainability, according to Ethical Consumer rankings, actually think that their money is in a ‘green‘ ISA.

Investors are also not fully informed about the extent of what labels can be applied to ISAs, especially if they seem counter-intuitive.

For example, half of consumers don’t believe a fund or savings account can be classed as ‘sustainable’ if it includes fossil fuel companies – even those that also invest in renewable energy.

However, a sustainable label can still be slapped on a fund that invests in fossil fuels, especially if the fund claims it is working on engaging with the polluter to pressure it to cut its emissions.

Meanwhile, 55 percent of investors said they didn’t even know if their ISA was using their money in an environmentally friendly way.

Investors are clearly pushing for more sustainable investment, as 47 percent of people said that banks should not be investing in fossil fuel expansion, rising to 57 percent of 18–34 year olds.

Young investors are also more sceptical of the claims made by financial institutions, with 36 percent thinking their ISA providers are likely to be engaging in greenwashing, compared to just 10 percent of over 55s.

Roger Hattam, director of retail banking at Triodos Bank UK, said that the findings demonstrated “the worrying truth about how well-intentioned consumers are being misled about how their money is being invested”.

The Financial Conduct Authority is set to bring in new anti-greenwashing rules later this year, but the research found only 10 percent of investors were aware of the new rules.

However, Hattam described the new rules as “desperately needed”, and more than half (59 percent) of investors said they were concerned about greenwashing in the financial services industry,

“There are millions of consumers wanting their money to align with their values, but this is not yet matched with real industry commitment to clearly signpost what causes their money is actually supporting,” added Hattam.

“As well as actively screening out negatives – such as never investing in fossil fuel companies – to truly invest in people and the planet, banks need to actively fund areas that are changing the world for the better.”

We wrote back in January that BYD had surpassed Tesla in fully electric vehicle deliveries for the first time in history. But who knows how long that will last, because now the auto manufacturer is running into “challenges” in expanding overseas, according to the Wall Street Journal. 

Despite its domestic success, BYD is grappling with issues such as low market demand, high prices, quality control challenges, and internal debates on market share acquisition strategies, the report highlights. 

Specific problems have included mold in vehicles and excess stock in European warehouses, WSJ notes. As a result, the company is likely to miss its internal sales target of 400,000 international car sales this year, with only around 16,000 vehicles sold in Europe in 2023.

The company told the outlet, however, that it remains optimistic about its international prospects under Chairman Wang Chuanfu’s leadership. Supported by Warren Buffett, BYD aims to emulate the global success of Japanese and South Korean auto brands.

BYD’s profits doubled to about $4 billion in 2023, and it maintains a market capitalization over $70 billion. However, BYD’s international journey has not been without its learning curves, similar to Asian predecessors like Hyundai, which faced recalls and quality issues in its early international expansion.

Despite avoiding widespread quality problems, BYD has seen incidents such as a bus fire in London and concerns over vehicle condition upon arrival in international markets, indicating challenges in handling long-distance logistics and maintaining quality standards.

“BYD is very satisfied with the achievements made by our overseas teams, including the one in Europe,” a company rep told the WSJ. 

Recall, Tesla announced back in January it had “produced approximately 495,000 vehicles and delivered over 484,000 vehicles” for Q4 2023. The company noted that its full year vehicle delivery number was up 38% to 1.81 million, slightly less than recently revised expectations for the year. Nonetheless, total deliveries marked a record quarter for the EV manufacturer. The company manufactured approximately 1.85 million vehicles for the period. 

But BYD beat Tesla’s quarterly number with its battery only electric vehicle, reporting sales of 526,000 for Q4, we pointed out. 

The company said it produced more than 3 million new energy vehicles for the year and it marks the second year that BYD has beat out Tesla in total production. BYD produced 1.6 million battery only vehicles, just slightly behind Tesla, and 1.4 million hybrids. 

We wrote back in September 2023 that BYD and Tesla were the two companies neck and neck leading the EV industry. We noted then that for the first half of 2023, BYD alone sold almost 1.2 million plug-in electric vehicles (incl. plug-in hybrids), roughly double the combined total of BMW, Volkswagen and Mercedes.