Authored by Caleb Howe via RealClear Wire,

Wealthy liberal foundations have been seeking to have influence on media coverage of energy and environmental matters by funding workshops, courses and seminars for journalists focused on climate change – and some of the world’s most elite universities are happy to oblige.

An analysis of funding initiatives led by some of America’s biggest private foundations shows several major left-of-center entities funding this training for climate journalists at Columbia University, Harvard University, and the University of Southern California. In addition, Britain’s prestigious Oxford University is involved in a similar endeavor across the Atlantic.

The news comes two years after the announcement by the Associated Press of its hiring of twenty climate journalists using $8 million in grants received from the same type of foundations to propel more climate journalism. After the infusion of funding, AP journalists appeared to forgo seeking comment from the fossil fuels industry on stories that affected them.

The organization Covering Climate Now is a major driver of climate-related news, reportedly encompassing “More than 500 news and media outlets [that] partner with the organization, which represents an audience of 2 billion people in 57 countries. Its partners include big names like ABC News, CBS News, Reuters, The Boston Globe, The Miami Herald, and The San Francisco Chronicle.”

NBC News and Bloomberg are also partners, and just recently, Portland’s KGW News was added as a partner.

Covering Climate Now was founded by the Columbia Journalism Review – an initiative of Ivy League Columbia University’s journalism school – in partnership with the far-left publication The Nation. Who funds it? Actions@EBMF, The David and Lucile Packard Foundation, Michaux Family Foundation, One Earth Fund, Park Foundation, Rockefeller Family & Associates, Rockefeller Family Fund, Schumann Media Center, Taylor Family Charitable Fund, and Wayne Crookes. Notably, Rockefeller money was also behind the AP climate journalism initiative.

Since Covering Climate Now and Columbia’s initiative was put in place, ABC, CBS, and Reuters have run a flurry of climate change-focused stories that seem designed to draw in non-climate hawks and amplify their concern about the issue by focusing on subjects of interest to extremely “average” news consumers, such as food, children’s mental health … even Christmas trees.

ABC has leaned into the trend especially hard, in the last few months running these headlines:

Youth at risk for mental health issues due to climate change, study shows

Climate change raises concerns for future of marathons and runner safety: Analysis

Teen survivor of Tubbs Fire sounds alarm on mental health effects of climate change

Climate change could soon make these staple Thanksgiving dishes more scarce

Climate change could soon affect the taste of beer, new study says

The “Tubbs Fire” story was co-authored by Stephanie Epps, whose climate coverage is favorably cited by the group here on their “tips” page.

The Thanksgiving food story was doubly appealing for leftist media, both blaming climate change for an immediate concern while letting Bidenflation off the hook. Efficiency is, after all, a watchword of the genre.

But the beer story was a real hit, and at least one other mass media “partner” news organization ran with it as other non-partners picked it up.

Here was CBS’s headline: Warming planet’s cold beer supply threatened by climate strain on hops, barley, water. You’ve got to give the Greta Thunberg fans of the world credit on this one; there may be no better way to make your average middle-aged American care about climate change more than raising the alert level for beer. Was that a Simpsons episode once? Or does it just seem like it could be?

Also since news first broke of Covering Climate Now and Columbia’s initiative, CBS has run with this headline:

World’s richest 1% emitting enough carbon to cause heat-related deaths for 1.3 million people, report finds.

While partner Reuters ran with this:

London underprepared for deadly climate change risks, report warns.

A Brit with whom I spoke for this piece who lived in London during the infamous 2022 heat wave quipped that the biggest reason climate change could prove deadly there is that precious little housing across the city is equipped with air conditioning – so a failure to adapt to a changing climate appears to be the major problem.

But Reuters has also really pinned the tail on the “cover climate change impacting things that even climate change deniers love” donkey. In December, they ran this piece: Climate change threatens Hungary’s Christmas trees.

Covering Climate Now has also touted partner pieces arguing that “massive programmes of green public investment would be the most cost-effective way both to revive virus-hit economies and strike a decisive blow against climate change,” talking up fracking’s alleged endangering of seniors sheltering in place during COVID, and Americans’ purported responsibility for Amazon rainforest deforestation – featuring Leonardo DiCaprio (because why not).

And this story about opposition to renewable energy in America’s heartland was done by ABC in full collaboration with Covering Climate Now. The story effectively blames Donald Trump for the rancorous debate:

The opposition often begins with a gut-level fear that solar or wind power is going to harm the look and feel of home, and then gets supercharged as people read and repeat talking points popularized by Donald Trump and others about how renewable energy is unreliable and dangerous. This is not to say that all the opponents are Republicans and that all the talking points are incorrect, only that there is a partisan sheen and a dearth of fact-checking. And the tone of the debate often reflects the way Trump has changed what’s acceptable public discourse, with attacks that are more personal.

Perhaps this is all being spawned through the Covering Climate Now and Columbia initiative, but since Harvard has been in the news plenty lately, it is worth noting that as far back as 2019, through the Neiman Foundation for Journalism, Harvard hosted a workshop telling journalists how they should cover climate change – a workshop funded by the John D. and Catherine T. MacArthur Foundation.

Meanwhile, University of Southern California’s Annenberg Center for Climate Journalism and Communication operates with funding from Bloomberg Philanthropies, the Beedie Foundation, the Manaaki Foundation, and Vere Initiatives.

And in the U.K., the Oxford Climate Journalism Network was founded in 2021 with a grant from the European Climate Foundation and then later funded by a grant from the Laudes Foundation. OCJN provides online courses for journalists, a leadership program for editors and newsroom managers, a fellowship program for study at Oxford, and academic research. OCJN states that “Every story is a climate story. Our network supports reporters and editors who want to make the climate crisis a central element of their journalism.”

For what it’s worth, it’s not just the most elite institutions in on the action. In the Upper Midwest, the Spartans are too, with Michigan State University’s Knight Center for Environmental Journalism having been founded with a grant from the Knight Foundation. The Knight Center recently received $150,000 from the Mott Foundation to work on DEI issues within environmental journalism.

As you read climate news, all of this is worth bearing in mind.

Facts are facts. Science is science. But journalism should be journalism, too, not activism. When you have politically invested and motivated entities and activists driving an entire major policy area’s news coverage – or if not driving it, certainly attempting to have a hand on the wheel – you have to ask about the objectivity and mission. Journalism, reporting – our world increasingly treats them as commodities and platforms, and the public is growing more accustomed to it. Climate reporting is an area where it’s easy to see. But what about areas where it’s not so easy? That’s why the principle is so important. So you can trust it no matter how hot – or warm – the topic.

Caleb Howe is an editor and writer focusing on politics and media. Former managing editor at RedState, he has been published at USA Today, Blaze, National Review, Daily Wire, American Spectator, AOL News, Asylum, fortune cookies, manifestos, napkins, and fridge drawings.

While Democrats and RINOs fight to send $75 billion to Ukraine and Israel, US Immigration and Customs Enforcement (ICE) is planning to release thousands of immigrants, and significantly curtail its ability to hold detainees, after the failure of a Senate border bill that would have erased a $700 million budget shortfall, according to the Washington Post, citing four officials at ICE and the Department of Homeland Security.

In short: because Ukraine didn’t get their money, Biden(‘s operatives who are actually running the government) – a good friend of Ukraine, is going to hurt America, as opposed to simply closing the border via Executive Order and diverting Pentagon funding like Trump did (until the liberal 9th Circuit in California ruled it unlawful). And recall, the Biden administration is fighting with Texas to remove razor wire.

After the Ukraine bill failed, which contained $6 billion in supplemental funding for ICE enforcement operations, agency officials began circulating an internal proposal to slash costs by releasing thousands of detainees, and reducing the number of beds in detention centers from 38,000 to 22,000.

Let’s not forget that the failed Ukraine bill would also allow 5,000 migrants into the country daily.

Not only does this bill codify 1.5 million illegal border crossings into law, but the “border emergency” that automatically gets implemented at 5,000 crossings per day in a week can be overturned by Joe Biden.

And in case 1.5 million illegals isn’t enough, it also locks in green… pic.twitter.com/pZRV4iymph

— Greg Price (@greg_price11) February 5, 2024

All of this comes ahead of an expected annual spike in migration this coming spring.

According to the report, DHS could try and plug the gap at ICE by diverting funds from the Coast Guard, the Transportation Security Administration (TSA), or other agencies within the department. ICE officials tell the Post that the $700 million deficit is the largest projected shortfall the agency has had in recent memory.

Some of the proposed cost savings in ICE detention would occur through attrition — deportations — but much of it would have to happen through the mass release of detainees, said the officials, who spoke on the condition of anonymity because they were not authorized to discuss internal deliberations.

Erin Heeter, a DHS spokesperson, said Congress has “chronically underfunded” the department’s “vital missions on the southwest border.” … “A reduction in ICE operations would significantly harm border security, national security, and public safety.” -WaPo

Compounding matters, record crossings in late 2023 left DHS agencies burning through their budgets for the 2024 fiscal year which began Oct. 1.

Propaganda everywhere!

As an aside, while we wouldn’t recommend voluntarily reading the Washington Post, their article is completely disingenuous – framing the failure to pass the $60 billion Ukraine (and a little for the border) bill as the GOP refusing to pass legislation that would help President Biden.

U.S. Immigration and Customs Enforcement has drafted plans to release thousands of immigrants and slash its capacity to hold detainees after the failure of a Senate border bill that would have erased a $700 million budget shortfall…

…

The bill’s failure produced a reversal of traditional partisan politics on immigration, with most Democrats embracing new border restrictions and funding for enforcement, while Republicans opposed the bill in part because it could benefit the incumbent president.

…

“Most recently, Congress rejected the bipartisan national security bill out of hand, which will put at risk DHS’s current removal operations,” Heeter said in a statement. “A reduction in ICE operations would significantly harm border security, national security, and public safety.” -WaPo

No. It was a terrible deal which – in addition to allowing 1.5 million illegals to flow into the country each year, would have also allocated $2.3 billion towards NGOs and other organizations which traffic them, on top of the aforementioned foreign aid. The agreement was reached by Sens. James Lankford (R-OK), whose own state legislature censured him for striking such a crappy border deal.

What’s more, under the failed legislation President Biden could close the border with the stroke of a pen, right now, but refuses to do so until Ukraine and Israel money materializes.

A lot more shady language in there. Allows “reprioritizing” funds originally earmarked for other uses. Way too much discretion and “reports” needed which allow 180 days or more stalling on things like border wall. Don’t need to be an attorney to catch all the loopholes!

— JustTheFactsMa’am (@BalistrariaFund) February 5, 2024

Wonder who they’ll eventually vote for?

Authored by Michael Lebowitz via RealInvestmentAdvice.com,

Over the last four quarters, Tesla generated total revenue and earnings of $96 billion and $15 billion, respectively. Toyota’s revenue and earnings are roughly three times larger at $299 billion and $44 billion. Yet Tesla’s market cap is more than double that of Toyota.   

Tesla shares have soared since going public, while Toyota and other major auto manufacturers’ shares have meandered along. Since going public in 2010 at $1.59 (split adjusted), Tesla shares are up nearly 12,000%. That figure is more stunning, considering it’s down 50% since late 2021. The graph below, charting the two stocks since 2018, highlights Tesla’s outperformance versus Toyota and the extreme volatility of its returns. As shown in the second graph, 40-50+% drawdowns are not uncommon for Tesla.

Tesla shares have outperformed Toyota’s and the market because of the significant growth of EVs, a robust outlook for EV market penetration, and forecasts that Tesla will maintain its lead role in manufacturing EVs. Tesla’s market cap relies on all three coming to fruition.

What if one or more of those do not occur? Might hybrids be the preferred technology until a more efficient battery evolves? Will EV competition from established and new auto manufacturers upend Tesla’s market share? Maybe most critical, could Toyota, not Tesla, be at the forefront of a significant technological advance for automobiles?

With a price-to-earnings ratio of 9 for Toyota and 72 for Tesla, the answers to our questions have critical implications for shareholders of both stocks.  

EVs VS ICE

Sales of EVs are multiplying. The latest data shows that EVs will account for 9% of all domestic new car sales in 2024. That leaves plenty of upside for EV manufacturers if the U.S. follows the path of other countries like Germany and China, in which EVs represent approximately a third of all new car sales.

While the transition from internal combustion engines (ICE) to electric is sure to continue, its pace appears to be moderating. There are a few drawbacks affecting the uptake of EVs.

EV Drawbacks

Consider the following:

• Fewer EV cars are eligible for Federal tax credits.

• Kelley Blue Book claims the five-year cost to own EVs versus ICE vehicles is 15% higher. 

• The time to “fill up” an EV is much longer than an ICE car, and the EV recharging infrastructure is inadequate in many places. Consequently, “range anxiety,” or the fear of running out of power at the wrong time or location, is a concern.

• Per the National Automobile Dealers Association (NADA)- The final cost of the vehicle is its depreciation at resell, the difference between what the consumer paid for it and its worth after five years of ownership. EVs lose an average of $43,515 in value; ICE vehicles depreciate by $27,883.

• EV batteries are less efficient in severe temperatures.

• EVs have higher insurance and financing costs.

• Lithium-ion batteries can catch fire in an accident and on rare occasions when they are not in use.

The obvious benefit for EV owners is fuel costs. NADA estimates an EV owner will save approximately $5,000 in gas and a few hundred dollars in maintenance costs over five years versus an ICE owner.

The market for EVs among early adapters and wealthier, environmentally concerned consumers is starting to get saturated. More car buyers will likely shift from ICE to EV, but that transition will be slower than it has been for the more eager first adapters.

Tesla Doesn’t Have a Monopoly Anymore

At one point, Tesla’s market cap was almost equal to that of the entire auto industry. Not only were Tesla investors projecting that Tesla would be the largest automaker, but also that some of their other ventures, like energy generation and robo-taxis would do fabulously well. A lot has changed since then.

Tesla no longer has a monopoly on EVs. Almost every auto manufacturer, and a few new ones like Rivian and Fisker, now manufactures EV cars, as shown in the graph below, courtesy of Cox Automotive.

Further, consider the following paragraph from Cox Automotive:

EV transaction prices in Q3 were down significantly from 2022. In an attempt to increase sales volume, Tesla slashed prices, which are now down roughly 25% year over year. The price cuts have helped, as Tesla’s Q3 sales grew by 19.5% year over year, surpassing the industry’s overall growth rate of 16.3%. However, Tesla’s share of the EV segment continues to plunge, hitting 50% in Q3, the lowest level on record and down from 62% in Q1.

Bottom line: Tesla is losing its competitive advantage. They are relinquishing EV market share and cutting prices, ergo profits, to stay competitive.

Hybrid- The Bridge Technology

This discussion of hybrid automobiles does not refer to models with gas engines and battery packs that can be plugged into a power source.

As shown in the graph above, Toyota lags every other automaker, with only 0.5% of sales coming from EVs. However, Toyota has a different strategy regarding producing environmentally friendly vehicles. They are the largest seller of hybrid cars. The hybrid Prius was introduced to the U.S. market in 2000. Toyota’s first mover experience gives them a unique advantage in profitably manufacturing hybrid vehicles.

Hybrid automobiles can get 35 to 50+ miles per gallon. The technology enables a battery to capture a charge through its braking mechanism. This electricity then supplements its internal combustion engine. Consumer Reports estimates hybrids provide a 40% improvement in gas mileage versus non-hybrids.

The graphic below, courtesy of CNBC, shows that U.S. sales of hybrids have easily kept up with EV sales since 2015.

Car owners prefer better gas mileage, and we presume many want to do their part to help the environment. That said, most auto consumers are not ready to fully commit to EVs. We listed some reasons for the hesitation, but likely the most important is the price. The CNBC graphic below shows hybrids and ICE vehicles are similar in price, while EVs are costlier.

We think hybrid vehicles can be the transitional technology of choice until a better EV battery evolves. Many consumers seem to agree!

More On Hybrids

The following is from a recent Wall Street Journal article entitled, Toyota Motor reports rise in quarterly net profit as sales grew.

Executives at Japanese automakers that are strong in hybrids, including Toyota and Honda, say they are skeptical of competitors’ ability to catch up quickly. They observe that it took some two decades for Japanese carmakers to bring their hybrids to profit-margin parity with purely gasoline-powered vehicles. 

Hybrid sales grew last year at a faster clip than sales for pure electric vehicles in the U.S. and some other markets. Signs have emerged that the EV push might have gotten ahead of U.S. consumers who are worried about charging problems and higher prices. That has steered them toward less expensive hybrids, which can be filled up with gasoline. 

Automakers that had been rushing to pivot toward full EVs are now reconsidering.

General Motors said last week it would introduce some plug-in hybrid models in North America after facing pressure from dealers.

Ford Motor said last year it would seek to quadruple its hybrid sales in the next five years.

Solid-State Batteries

We now consider the next potential game changer for the auto industry: solid-state batteries. Solid-state batteries promise to eliminate many problems associated with current EV lithium-ion batteries.  

Lithium-ion batteries are heavy, expensive to manufacture, slow to charge, and have a mileage range considered too short by many. Solid-state batteries vastly improve on those problems. However, whether the technology can be mass-produced at reasonable costs is unclear.

Many experts believe Toyota is the leader in solid-state battery development. Per Forbes:

Toyota’s stated goal is for their solid-state batteries to ultimately have a range of >1,200km, and to go from 10 – 80% charge in 10 minutes or less. This compares to the Tesla Model Y, which currently has a range of 542 km, and fast-charges in 27 minutes.

Other automakers are investing in solid-state battery development. Toyota believes they will be the first to produce cars with solid-state batteries. Production could come as early as 2027. The investment and production costs are enormous, and there are no promises these batteries will make economic sense for consumers or manufacturers.

Tesla does not believe in the viability of solid-state technology, and, as far as the market knows, it is not developing solid-state batteries.

Tesla 4680 Battery Cells

Elon Musk is an innovator. He knows that his current battery technology will fall behind his competitors if it is not improved. Tesla is betting on 4680 batteries instead of solid-state. The 4680 battery hopes to improve cost, weight, and energy density.

Per evlithium.com, the potential benefits are battery weight, which may be about 10% lighter. Additionally, the cost of the batteries could be 15% cheaper, and the driving distance on a charge could improve by 10-15%.

Such would be a decent improvement, but it pales compared to the promise of solid-state batteries.

Fundamentals and Valuations

So, with an appreciation for the role of hybrids, EVs, and solid-state batteries, let’s compare Toyota to Tesla and better appreciate their comparative valuations and fundamentals.

Valuations

Before looking at the valuation comparisons below, consider that Tesla is a high-growth company while Toyota is mature. Toyota is the world’s largest auto manufacturer, while Tesla is ranked 15th. Given its smaller size, it is much easier for Tesla to gain global market share. The potential for outsized growth is reflected in the valuations. Tesla trades at valuations 6-8 times that of Toyota, implying 6-8x excess growth for Tesla over the long run.

The PEG ratio, however, tells a different story. The PEG ratio divides each company’s P/E ratio by its 3-5-year expected earnings growth. The ratio helps normalize the P/E ratio for companies with varying growth rates.

Based on the P/E and the PEG ratio, the market implies earnings growth of 19.05% for Toyota and 12.44% for Tesla.

Fundamentals

In addition to growing more rapidly than Toyota, Tesla is more operationally and financially efficient. EV cars have fewer parts, making assembly quicker and cheaper. Additionally, Tesla’s revenue and earnings benefit from EV credits. Lastly, Tesla generates revenue from other sources. While not currently sizable, they skew the data and forecasts.

Toyota’s revenue has been relatively stagnant over the last five years, while Tesla has grown by 33% a year on average. Tesla’s cash flow growth is challenging to gauge as they are heavily reinvesting into production and R&D, as shown by the tremendous growth in its capital expenditures. Another indication that the companies are in different lifecycle stages is Tesla’s lack of dividends compared to Toyota’s healthy 3.55% yield.

Tesla has much less long-term debt than Toyota. However, if they are to continue growing rapidly, debt will likely grow accordingly.

Betting On The Future

Investing in Tesla or Toyota is a bet on the future of automobiles.

Tesla shareholders hope the company will continue improving EV technology, expanding its charging network, and gain valuable market share. Importantly, it’s a wager that some version of the current lithium-ion battery technology is the future of EVs. Tesla has other non-manufacturing ventures that may also be very profitable.

Toyota investors will do well if the company maintains its leadership in ICE vehicles and its hybrid models continue to gain market share. Further, if solid-state batteries are the preferred EV battery, then Toyota may have a huge leg up on Tesla and the industry.

Toyota has a price-to-earnings (P/E) ratio of 9, less than half of the S&P 500 and well below Tesla’s 72. It appears that Toyota offers a conservative investment in the state of the current auto industry with a potentially valuable option for the future via its considerable investment in solid-state batteries.

If solid-state batteries prove to be the next step in EVs, Toyota may be the next Tesla. In such a case, Tesla may struggle if they don’t adapt to comparable technology. However, if solid-state technology is too costly, Tesla may continue to gain market share and meet the lofty goals of its shareholders.

It’s worth disclaiming that other potential technologies, such as hydrogen, exist. While we don’t discount them, we limit this discussion to what is probable over the coming five years.

Summary

Toyota appreciates hybrid vehicles’ role in transitioning to more energy-efficient transportation. While losing the EV battle, they make up for it in hybrid sales. More importantly, they may have a better EV battery within a few years. If Toyota can continue to dominate the hybrid space and make significant inroads into EVs later this decade via a solid-state battery, its stock is cheap.

Tesla is a bet on Elon Musk and his proven ability to innovate. Not only did he start the EV revolution, but he is at the forefront of other exciting technologies. How those fold into Tesla is unknown.

While Musk has proven to be a great horse to bet on, Tesla’s price is very high. At a P/E of 72 and a PEG ratio more than 10x its competitors, Tesla investors are hoping for continued tremendous growth. Importantly, they are betting that Tesla will take significant market share from well-established automakers.

Given all he has accomplished, it’s hard to bet against Elon Musk. However, we think Toyota may be the safer investment and the stock with more upside.

After the Senate passed a $95 billion foreign aid package Tuesday morning, Speaker Mike Johnson (R-LA) refused to hold a vote on it before Congress secures the southern US border first.

“We really do owe it to the American people to get control of that border,” said Johnson.

In response, House Democrats are laying the groundwork to force a vote on it anyway using a rare procedural move known as a discharge petition, which would require at least 218 signatures – and the support of some Republicans, to bring the legislation up for a vote.

The package allocates $60 billion to Ukraine support, $14 billion in military assistance to Israel, $9 billion in humanitarian aid to Gaza and elsewhere, and around $5 billion to defend Taiwan.

In a letter to his colleagues, House Democratic Leader Hakeem Jeffries (D-NY) said that the caucus would use “use every available legislative tool” to advance the bill, and called on “traditional Republicans” to support it.

“It’s not too much to ask in America’s national security that we get an up or down vote and let the House of Representatives actually work it’s will,” said Jeffries, without explaining how it’s a matter of America’s national security to defend Ukraine’s borders.

Johnson told reporters Tuesday that he would “certainly oppose” a discharge petition.

If it’s brought up, it will pass…

“If it were to get to the floor, it would pass — let’s just be frank about that,” said Rep. Andy Biggs (R-AZ), who said he would personally be a “hard no” on the bill.

And Sen. Mitch McConnell (R-INO), a staunch Ukraine supporter (but not so much America’s borders), said “We’ve heard all kinds of rumors about whether the House supports Ukraine or doesn’t. It seems to me that the easy way to solve that would be to vote.”

According to Jeffries, there are “more than 300 bipartisan votes” in the House for the foreign aid package.

As Axios notes further;

Between the lines: GOP hardliners repeatedly have defied Johnson over the last several months, but the appetite for rebellion among the moderate Republicans likely to support Ukraine aid remains untested.

• As the Government Affairs Institute’s Matt Glassman points out in a useful thread: “The gap between ‘what will you vote for if forced to vote’ and ‘what will you demand gets voted on’ is huge.”
• “This is what makes discharge so hard. … The problem is [the] cost of undermining the leadership agenda is so high that little rises to that level for most members,” Glassman said — especially on an issue like Ukraine aid, which Trump and the GOP base vocally oppose.

Ukraine is getting their (US Taxpayer) money either way?

“We have to get this done,” House Intel Chair Mike Turner (R-OH) told Politico. “This is no longer an issue of, ‘When do we support Ukraine?’ If we do not move, this will be abandoning Ukraine.“

Like Democrats have abandoned the southern border?

Authored by Austin Alonzo via The Epoch Times (emphasis ours),

The rich and famous are ready to bankroll the Biden campaign, according to federal disclosures. Accounting for all of its financial mechanisms, the Biden campaign entered 2024 with more than $100 million on hand.

President Joe Biden’s reelection campaign will rely on two main fundraising political action committees: Biden For President, his principal campaign committee, and Future Forward (FF) PAC, a hybrid PAC, along with a joint fundraising committee, the Biden Victory Fund.

As a hybrid PAC, FF PAC can solicit and accept unlimited contributions from individuals, corporations, labor unions, and other political committees, according to the Federal Election Commission (FEC). It must maintain two bank accounts: one for independent expenditures on advertisements or voter drives, and another for making direct contributions to federal candidates.

Biden Victory Fund is a nonqualified joint fundraising committee. According to the agency, that means it is a political committee working together with “one or more other political committees or unregistered organizations.”

A nonqualified fund, according to the FEC, can “receive limited financial and administrative support from a sponsoring organization that is not a corporation or a labor organization, such as a partnership or an unincorporated association.”

The three funds collectively took in about $262.6 million in 2023, according to their year-end reports filed with the FEC on Jan. 31. They spent about $157.8 million and had about $107.5 million on hand at the end of the year.

In terms of spending, Biden For President focused its expenditures on media buying and production. Two firms, Media Buying & Analytics LLC and Gambit Strategies LLC, were collectively paid more than $17 million.

Biden Victory Fund, for its part, sent huge sums to Biden For President, the Democratic National Committee (DNC), and state parties. Nearly $50 million was sent to Biden For President, while the DNC got more than $17 million.

The biggest donors chipped into FF PAC possibly due to limitations on how much can be given to the other funds. However, several notable donors sent nearly $1 million to the Biden Victory Fund.

Future Forward Action USA

The biggest individual donor to the Biden campaign is the nonprofit group Future Forward Action USA, which shares leadership and a name with FF PAC.

Future Forward Action USA sent FF PAC about $8.3 million, or about a third of its total fundraising, in 2023.

As a 501(c)(4) group, Future Forward USA Action is not subject to the same disclosure requirements of other funds associated with political campaigns.

FF PAC, Joe Biden for President, and Biden Victory Fund must release their financial information to the public regularly under FEC rules. In 2024, they will report monthly.

A 501(c)(4) group is not limited in whom it can accept money from, nor how much it can spend, and doesn’t have to say who is donating to it. It also doesn’t report its activities as often as FEC-regulated funds do.

In 2020, Future Forward USA Action provided about 40 percent of FF PAC’s funding.

James Simons

James Simons, one of the wealthiest men in the world, gave $2.5 million to FF PAC in December 2023. A mathematician, Mr. Simons, the founder of Renaissance Technologies LLC, is considered one of the most successful investors of all time.

The FEC listed his current business as Euclidean Capital LLC. According to Forbes, Mr. Simons is worth $30.7 billion.

Mr. Simons is a significant Democratic Party donor. According to OpenSecrets’ donor records, he regularly makes contributions of more than $1 million to Democratic-aligned groups like House Majority PAC, Senate Majority PAC, and Priorities USA Action.

Representatives of Mr. Simons didn’t respond to a request for comment.

Fred Eychaner

Chicago-area media mogul Fred Eychaner gave $2 million to FF PAC in November 2023.

Mr. Eyechaner is the president of Newsweb Corp., a publisher of alternative newspapers and owner of broadcasters in greater Chicago. He is also a significant Democratic Party donor and regularly sends multimillion-dollar gifts to Democratic causes, according to OpenSecrets’ donor records.

Representatives of Mr. Eychaner didn’t respond to a request for comment.

Jeffrey Katzenberg

Entertainment impresario Jeffrey Katzenberg gave $1 million to FF PAC in September 2023. Mr. Katzenberg is a national co-chair of the Biden campaign.

Mr. Katzenberg, now the president of the venture capital firm WndrCo Holdings LLC, was a co-founder of DreamWorks and worked at leading studios such as Disney and Paramount. He also founded the ill-fated video platform Quibi.

Along with his media and investment roles, Mr. Katzenberg is a longtime Democratic Party donor. While the Biden donation was his first contribution north of $1 million since 2022, he often sends gifts to Democratic Party candidates and causes. In June 2023, he shipped $250,000 to the Senate Majority PAC.

Mr. Katzenberg and his wife, Marilyn Katzenberg, collectively gave about $1.78 million to the Biden Victory Fund in April 2023.

Jeff Worthe

Jeff Worthe, president of Santa Monica, California-based Worthe Real Estate Group, gave $1 million to FF PAC in September. According to its website, the group owns more than 7 million square feet of property in the greater Los Angeles area.

According to OpenSecrets’ donor records, Mr. Worthe was a key funder of Democratic Party causes in 2020, making nearly 100 contributions to various state parties and candidates, as well as significant gifts to the DNC.

Laborers International Union of North America

The Laborers International Union of North America, or LIUNA, gave $1 million to FF PAC in December 2023.

According to its website, LIUNA represents over 70,000 public employees and is affiliated with the National Postal Mail Handlers Union, which has 47,000 members representing employees of the United States Postal Service.

Various LIUNA entities consistently support the Democratic Party, according to federal records and OpenSecrets accounting. For instance, in 2020, its Laborers’ International Union of North America PAC spent more than $500,000 in support of President Biden.

Representatives of LIUNA didn’t respond to a request for comment.

Deborah Simon

Deborah Simon, a daughter of Simon Property Group Inc. founder Melvin Simon, gave $1 million to FF PAC in August 2023.

According to OpenSecrets’ donor records, Ms. Simon is an important donor to Democratic and progressive causes. She has given at least 20 gifts of $1 million or more to party committees and organizations since 2017.

Notable Contributors To Biden Victory Fund

The Biden campaign is raking in money from its joint fundraising committee, which it can then distribute elsewhere. Some notable figures gave almost $1 million to that account in 2023.

Stewart Bainum and Sandra Bainum: The chairman of Choice Hotels International Inc. and his wife donated approximately $1.86 million as a couple. Other family members, Barbara Bainum, Bruce Bainum, and Charlene Bainum, each contributed $250,000.

Robert Hale and Karen Hale: Telecom billionaire Robert Hale, co-founder of Granite Telecommunications LLC, and his wife, Karen Hale, donated $1.75 million as a couple.

George Soros: The progressive megadonor and founder of the Open Society Foundation contributed more than $900,000.

Steven Spielberg: The filmmaker behind classic movies such as “Jaws,” “Raiders of the Lost Ark,” and “Jurassic Park” donated more than $929,000.

Laurene Powell Jobs: The billionaire widow of Apple Inc. co-founder Steve Jobs invested more than $929,000 into the fund.

Representatives of The Bainums, The Hales, Mr. Soros, Mr. Spielberg, and Ms. Powell Jobs did not respond to a request for comment.

Authored by Paul Joseph Watson via Modernity.news,

The inventor of the ‘gold standard’ in cognitive tests suggested Joe Biden should take one as the controversy surrounding the president’s mental ability continues to swirl.

Questions over Biden’s mental decline soared above the fold of partisan fodder last week and can no longer be pinned on him just being a forgetful public speaker.

Special counsel Robert Hur concluded in his report that Biden did not remember when he was vice-president or within “several years” when his son Beau died.

Biden responded to the report by getting angry and shouting at reporters, claiming his memory was fine before then mixing up the leaders of Mexico and Egypt.

Canadian neurologist Dr. Ziad Nasreddine, who invented the ‘gold standard’ of cognitive tests, told the New York Post that all ageing politicians should take it.

“It’s a good thing that we assess cognition the minute there’s any suspicion about cognitive function,” said Nasreddine.

“If the test shows normal results, the likelihood of impairment is very low. Then everybody is reassured that this is maybe just normal aging — that we can all be forgetful and make mistakes. But it doesn’t mean that there’s a significant cognitive disorder happening,” he added.

Nasreddine suggested it was hard to tell cognitive impairment from conversation alone, therefore taking his test was key.

The test “features 30 questions administered in 10 minutes and instructs patients to identify animals and copy an image of a cube, among other challenges,” reports the NY Post.

Donald Trump famously took Nasreddine’s test in 2018 and bragged about his stellar result afterwards.

Trump recently responded to Biden’s obvious early-onset dementia by demanding cognitive tests for all presidential candidates.

Democrats are panicking to replace Biden after he twice claimed to have recently spoken to political leaders who have been dead for decades.

The White House tried to dismiss the mistake as “normal,” but one ally told the Telegraph that his recent press conference performance was “the worst day” of Biden’s entire presidency.

Meanwhile, despite a poll finding a whopping 86% of US adults believe Biden is too old to complete another term, the media is still desperately running damage control.

“The party told you to reject the evidence of your eyes and ears. It was their final, most essential command.” pic.twitter.com/rO2n58zpDp

— Paul Joseph Watson (@PrisonPlanet) February 14, 2024

*  *  *

Your support is crucial in helping us defeat mass censorship. Please consider donating via Locals or check out our unique merch. Follow us on X @ModernityNews.

There have been mounting concerns recently that the unfolding commercial real estate crash is accelerating and has rippled across the global financial system. From New York Community Bancorp to Japan’s Aozora Bank Ltd. and Germany’s Deutsche Pfandbriefbank AG, sizable credit losses and/or write-downs of US CRE debt have plunged some lenders into turmoil. 

Lenders heavily invested in US CRE debt are facing significant challenges that will persist for a long time. Vishwanath Tirupattur, global head of Quantitative Research at Morgan Stanley, warned about this in a note last week. 

Now Bloomberg reports brokers have begun to sell debt secured by office buildings in Manhattan, owned by Blackstone Inc., at a staggering 50% discount. A prime-time tower in Los Angeles was auctioned off in December, fetching 45% lower than its purchase price a decade ago. Additionally, the Federal Deposit Insurance Corp. has recorded a 40% loss on $15 billion worth of loans it disposed of, secured by apartment buildings in New York City. 

The fallout will worsen because the bubble unwinding in the CRE market is a byproduct of a decade of rock-bottom rates that forced investors out of safe assets like bonds into risky CRE debt. 

Last week, Treasury Secretary Janet Yellen said CRE losses are concerning but comforted investors with the understanding the situation is “manageable.” Meanwhile, real estate investor Barry Sternlicht, chairman and CEO of Starwood Capital, has a more dire outlook, warning about trillion-dollar office losses. 

“The office market has an existential crisis right now… it’s a $3 trillion dollar asset class that’s probably worth $1.8 trillion [now].” 

Scott Rechler, chief executive officer of New York landlord RXR, recently told Bloomberg: 

“In 2024, we’re at that fifth stage of grief” for the CRE space, adding, “People are now in acceptance.” 

CRE turmoil has rocked domestic and overseas banks:  

• New York Community Bancorp Collapse Nears 27-Year-Lows After ‘Talks With Regulator’ Revealed
• CRE Crisis Goes Global: Shares Of Japan’s Aozora Bank Implode On Massive US CRE Exposure
• More Dominoes: US CRE Downturn Sends German Lenders Into Turmoil

As of December, offices accounted for 41% of the US’s nearly $86 billion worth of distressed properties, as per MSCI data. The term “potential distress,” indicating a decline in the financial health of assets, is approaching $235 billion across various types of properties. 

Office and apartments account for the bulk of distressed US property.

Doom and gloom continued with a new CRE note from Morgan Stanley, warning that “years of supply” of office tower space will be the “greatest headwind” that will continue to exert downward pressure on prices.  

Analysts led by Ronald Kamdem and Adam Kramer show years of supply for Class A and Class B offices are currently well above pre-Covid averages. 

Our analysis suggests there is significant supply risk for the office sector in 4Q23 at the national level with current years of supply for both Class A and Class B/C (18 and 23 years, respectively) well above the pre-pandemic averages (13 and 19 years , respectively) — see Exhibit 5 . While the supply risk picture at the national level remains concerning and implies vacancy rates will likely remain under pressure, we acknowledge that REIT-specific takeaways remain more nuanced given substantive regional and market-specific differences

Considering the warnings from analysts regarding supply, the chaos in the CRE sector will persist. Recent information from Trepp indicates that over a trillion dollars in CRE loans are due for maturity by the end of next year.

Exactly a week after a failed attempt, the House has impeached Homeland Security Secretary Alejandro Mayorkas, under whose tenure more than 10 million illegal immigrants have entered the US – doubling the existing population of migrants.

With a vote of 214-213, Mayorkas is the first cabinet official to be impeached since the 1870s.

🚨 BREAKING: Disgraced Biden DHS Sec. Alejandro Mayorkas has officially been impeached by the U.S. House of Representatives over his “willful and systemic refusal to comply with the law” and “breach of public trust.” pic.twitter.com/63mUmdXwPj

— RNC Research (@RNCResearch) February 14, 2024

Last week’s effort to impeach Mayorkas failed by one vote because three Republicans voted with all the Democrats against the move. The vote was made possible only by the return of House Majority Leader Steve Scalise (R-La.), who missed last week’s vote while undergoing treatment for blood cancer, according to The Hill.

Mayorkas was accused of demonstrating a “willful and systemic refusal to comply with the law,” and “breaching the public trust,” which Democrats suggested was nothing more than disagreements over policy or performance failings, but not impeachable crimes.

“Secretary Mayorkas is a danger to every American,” said Rep. Dan Bishop (R-NC) on X. “I’m voting to impeach him.”

Secretary Mayorkas is a danger to every American.

I’m voting to impeach him. pic.twitter.com/8T3VR5wK8Q

— Rep. Dan Bishop (@RepDanBishop) February 13, 2024

The GOP leaders moved to hold the vote before their majority potentially shrinks even further, with a closely watched special election Tuesday in New York to replace expelled Republican Rep. George Santos. The race is considered a tossup.

Republicans continued the impeachment effort after rejecting an effort in the Senate to craft a bipartisan border deal to address many of the same issues House conservatives are raising. House Speaker Mike Johnson (R., La.) called the Senate’s deal—which paired aid for Ukraine with changes to border policy—dead on arrival, eventually leading most Republicans in the House and Senate to criticize the bill as insufficient. On Tuesday morning, the Senate passed a $95.3 billion package for Ukraine, Israel and Taiwan that excluded border-policy changes. –WSJ

Meanwhile, what’s this?

HUGE: @JudicialWatch just found the documents showing Mayorkas PERSONALLY rejected Secret Service protection for @RobertKennedyJr. This is simply despicable. That it took a federal FOIA lawsuit to force out this information speaks volumes. https://t.co/c2BbLGhz7Q https://t.co/qcDJ34G6hW

— Tom Fitton (@TomFitton) February 13, 2024

Authored by James D. Agresti via The Epoch Times (emphasis ours),

In a recent trio of posts to X, Elon Musk wrote that (1) illegal immigrants “are not prevented from voting in federal elections,” (2) “you don’t need government issued ID to vote,” and (3) Democrats “are importing voters.”

To rebut those statements, The New York Times (NYT) published an article by Jim Rutenberg and Kate Conger claiming that Mr. Musk is “spreading election misinformation” about “illegal voting by noncitizens” and echoing a “conspiracy theory” spread by former President Donald Trump.

Although Mr. Musk’s words are imprecise, the gist of what he wrote is correct, and The NYT is categorically wrong.

Illegal Voter Registration

In response to Mr. Musk’s first two points, The NYT argues that “federal law requires identification verification from voters when they register.” The hyperlink in that sentence leads to a document by the liberal Brennan Center for Justice claiming that “new identification requirements” in a 2002 federal voting law “may severely threaten voters’ rights.”

What The NYT fails to reveal is that the Brennan Center document describes the identification requirements in the law, which don’t require government-issued ID or proof of citizenship—just as Mr. Musk wrote. The document notes that even a “utility bill” or “bank statement” is enough to comply with the law. The text of the 2002 legislation and the current U.S. election code law confirm this.

Furthermore, a 2013 Supreme Court ruling supports Mr. Musk and contradicts The NYT by explaining that the National Voter Registration Form “does not require documentary evidence of citizenship; rather, it requires only that an applicant aver, under penalty of perjury, that he is a citizen.”

In fact, the court’s 2013 ruling blocked the state of Arizona from requiring “documentary proof of citizenship” to register to vote. Likewise, a 2020 appeals court ruling prohibited other states from doing the same, and the Obama administration filed a brief arguing for that outcome.

To be clear, federal law and the laws of all 50 states require people to be U.S. citizens in order to register to vote in federal elections, and federal law forbids people from falsely claiming citizenship to register to vote. Penalties for lying about this include up to five years in prison. However, enforcement mechanisms for such laws are limited, and opportunities to get around them are ample.

The situation was summarized by President Barack Obama shortly before the 2016 U.S. presidential election when actress Gina Rodriguez asked him whether “Dreamers” and “undocumented citizens” would be deported if they voted. President Obama replied:

“Not true. And the reason is, first of all, when you vote, you are a citizen yourself. And there is not a situation where the voting rolls somehow are transferred over, and people start investigating, et cetera.”

After dodging the fact that “Dreamers” and “undocumented immigrants” are not citizens, President Obama’s clear message was that there is no effective way to enforce the law that prohibits them from voting.

And when President Trump’s Advisory Commission on Election Integrity asked the states for “detailed, publicly available voter-roll data” that could be cross-checked against other databases with information on citizenship status, states refused to turn over the data and filed a flurry of lawsuits to stop the commission. In the words of California’s secretary of state:

“While the commission is allowed to request the personal data of California voters, they cannot compel me to provide it. Let me reassure California voters: I will not provide the Commission with any personal voter data. …

“Yesterday’s ruling is merely the first in a string of lawsuits challenging the Commission. Those lawsuits send a strong message—the Commission will face opposition at every step of the way from those who are fighting to protect our voting rights, our privacy, and our democratic principles.”

Note that California alleged the commission asked for “personal data,” but in reality, the commission explicitly requested “publicly available voter-roll data.”

California’s deceptive refusal of the request and the ample openings for non-citizens to vote take on added significance in light of the following testimony by California Senate leader and Democrat Kevin De Leon in 2017:

“I can tell you half of my family would be eligible for deportation under [President Trump’s] executive order, because if they got a false Social Security card, if they got a false identification, if they got a false driver’s license … if they got a false green card. And anyone who has family members who are undocumented knows that almost entirely everybody has secured some sort of false identification.”

Illegal Voting

The NYT also alleges that “instances of illegal voting by noncitizens are rare” and supports that claim with a link to PolitiFact—an outfit with a record of publishing flagrant falsehoods on illegal voting and many other issues.

Although data on violations of laws with weak enforcement mechanisms are rare, scientific surveys of non-citizens have found that roughly:

• 13 percent of Hispanic non-citizens admitted they were registered to vote in 2013.

• 14 percent of all non-citizens admitted they were registered to vote in 2012, and 9 percent stated “I definitely voted” in the 2012 U.S. presidential election.

• 15 percent of all non-citizens admitted they were registered to vote in 2008, and 8 percent stated “I definitely voted” in the 2008 U.S. presidential election.

Those rates are only for self-admitted actions, and database matches with voting and registration records show the actual rates are about twice as high. In 2008, the one year for which Just Facts has full data, 27 percent of non-citizens were registered to vote, and 16 percent of them actually voted.

The studies that yielded the data above have significant margins of error due to relatively small sample sizes, and there are other sources of uncertainty—some of which may produce overcounts and some undercounts. But given that the Census Bureau estimates there are about 20 million non-citizen adults living in the United States, a million illegal votes will be cast in every federal election if only 5 percent of them vote.

As summarized by a 2014 paper in the scholarly journal Electoral Studies, “some non-citizens participate in U.S. elections,” and “this participation has been large enough to change meaningful election outcomes including Electoral College votes, and Congressional elections.”

Some media outlets and “fact checkers” have tried to contest those realities, but a multitude of facts from academic books and journals have shown that their arguments consist of mathematically illiterate notions, half-truths, and outright falsehoods. On top of this, one “fact checker” leveled slanderous accusations against Ph.D. scholars who conducted and vetted seminal studies on this matter.

‘The Great Replacement’

The NYT also asserts, “Musk implied that Mr. Biden and the Democrats were being lax on immigration because ‘they are importing voters,’ an echo of the ‘great replacement’ conspiracy theory that Mr. Trump was sharing around the same time.”

The hyperlink in that sentence leads to another NYT article that blames Republicans for spreading a “Great Replacement” narrative “used to justify an act of racist violence” in a mass murder of 10 people in a Buffalo supermarket in 2022.

The NYT and other media outlets tar Republicans with such guilt-by-association tactics. However, the press gives itself a pass when similar atrocities are committed by people who parrot their false narratives.

The NYT article doesn’t even attempt to rebut Mr. Musk’s point but simply calls it a “conspiracy.” However, multiple facts prove that what Mr. Musk wrote is true.

For example, 82 percent of non-citizens who said they voted in 2008 stated that they voted for Democrat Barack Obama, while only 18 percent said they voted for Republican John McCain.

Citing figures that would dwarf the number of non-citizens who vote illegally, Eliseo Medina, a former executive vice president of the Service Employees International Union, stated in a 2009 speech that:

• the “progressive community” can “expand and solidify the progressive coalition for the future” by putting “12 million” unauthorized immigrants “on the path to citizenship and eventually voting.”

• turning illegal immigrants into citizens will create a progressive “governing coalition for the long term, not just for an election cycle.”

Illegal immigrants and other non-citizens generally have low incomes and exceptionally high rates of not having a high school diploma. A majority of people with these attributes vote for Democrats.

The lopsided votes of non-citizens for Democrats are consistent with the promises and actions of Democrat politicians to give free health care, amnesty, and citizenship to people who immigrate to the United States, illegally or legally. The electoral implications of this are further highlighted by facts such as these:

• A nationally representative bilingual poll of 784 immigrant Latinos conducted by Pew Research in 2011 found that 81 percent said they would prefer “a bigger government providing more services,” and 12 percent said they would prefer “a smaller government with fewer services.” In stark contrast, 41 percent of the general U.S. population said they would prefer a bigger government, and 48 percent said they want a smaller one.

• A 2012 poll of 2,900 immigrants who were U.S. citizens found that 62 percent identified as Democrats, 25 percent as Republicans, and 13 percent as independents.

• A nationally representative bilingual poll of 800 Hispanic adults conducted by McLaughlin & Associates in 2013 found that 59 percent were born outside the United States, 53 percent considered themselves to be Democrats, 12 percent considered themselves to be Republicans, and 29 percent considered themselves to be independents or belonging to another party.

The fact that illegal immigration, amnesty, and legal immigration help the political prospects of Democrats is incontestable, not a conspiracy.

Conclusion

Beyond attacking Mr. Musk for posting genuine facts about illegal voting by non-citizens, the NYT article complains that “X’s fact checkers are long gone” and that the previous “complaint line between the [Biden] campaign and the platform is dead.”

The NYT bemoans those developments while failing to report that pre-Musk Twitter censored genuine facts and promoted demonstrable falsehoods about Russiagate, Hunter Biden’s laptop, COVID-19, and more.

In short, The New York Times is falsely accusing Elon Musk of the very thing that The NYT and the previous owners of Twitter are guilty of—spreading misinformation.

From Just Facts Daily

Views expressed in this article are opinions of the author and do not necessarily reflect the views of The Epoch Times or ZeroHedge.

After the worst rout for US stocks since March 2023, which followed hotter than expected CPI prints across the board andsparked fears the Federal Reserve may not cut interest rates as soon as expected, US equity futures and Treasuries rebounded with S&P 500 futures adding 0.6% and rising to 5,000 after the worst inflation-day drop for the index since September 2022, while Nasdaq futures rose 0.6% as JPM writes that “markets will see if yesterday was a blip and today’s relief rally is sustainable or if it is a deadcat bounce.”  10Y Treasury yields retraced some of the previous day’s surge, but held above 4.3% as traders trimmed bets for an early Fed rate cut. In a mirror image response, UK’s FTSE 100 jumped by almost 1% after the latest UK CPI print came in lower than expected; European bourses began the session on a mixed footing and trade was generally tentative, before eventually the Stoxx moved into the green. Oil prices are little changed, with WTI trading near $78. Spot gold falls 0.1%. Bitcoin gains over 3% and is back above $50,000. There are not notable data releases today; Thursday’s Retail Sales and Friday’s PPI have implications for the inflation outlook and yield curve. Today kicks off another day of Fedspeak with both Barr and Goolsbee.

In a hilarious screwup overnight, Lyft first exploded over 60% after the company “mistakenly” guided 500bps of EBITDA margin growth, adding more than $3BN in market cap, before the company admitted there was a typo and the real number was 50bps. Still, the stock jumped 22% this morning after the ride-sharing company’s results did beat expectations modestly on key metrics.

Here are some of the other most notable premarket movers:

• Airbnb falls 4% after suggesting that demand in the current quarter wouldn’t be as robust as the last.
• Cryptocurrency-linked stocks rally as Bitcoin shows resilience to the higher-than-expected US inflation print and advances beyond the $50,000 mark: Cleanspark (CLSK) +14%, Marathon Digital (MARA) +12%, Riot Platforms (RIOT) +9%
• GoDaddy slips 2% after revenue guidance missed estimates.
• Instacart drops 5% after the online grocery delivery firm reported fourth-quarter revenue that missed expectations.
• MGM Resorts falls 3% as a drop in revenue from regional business dragged on overall quarterly results.
• QuidelOrtho plummets 38% after the diagnostics company issued a full-year adjusted earnings per share forecast that missed expectations.
• Robinhood jumps 14% after the online brokerage firm reported fourth-quarter net revenue that beat estimates.
• Uber gains 6% after unveiling a buyback plan totaling as much as $7 billion in shares.
• Upstart drops 14% after its guidance for the first quarter disappointed.

 Meanwhile, the surge in crypto continues with Bitcoin rising above $51,000, the highest since Dec 2021 as the relentless net inflows in bitcoin ETF hit a record high.

The CPI data came as a disappointment for investors pushing US stocks to a record, and European peers to just short of one, on mounting hopes for imminent rate cuts. Fed swaps shifted full pricing of a rate cut to July from June after the data and global bonds erased the last remnants of a rally that started in December.

Despite the setback, investors riding bets on an eventual Fed pivot to easier policy aren’t hitting the sell button. BlackRock Inc. portfolio manager Russ Koesterich sees the setback as temporary, with potential for further upside to US stocks of 6-8% this year and possibly four rate cuts still in the offing.

“Despite yesterday’s action in the stock market it’s probably going to to be a decent year for US equities,” Koesterich said in an interview with Bloomberg TV. “There’s reason to stay long equities. I don’t think the narrative changes. We still think that the Fed will begin cutting late this spring or in the summer. We still think three, maybe four, cuts are likely.”

There was better news Wednesday for UK traders looking forward to policy easing by the Bank of England. Inflation in Britain came in lower than forecast in January, with underlying price pressures not rising as much as markets and the BOE feared. The pound reversed earlier gains after the data, while UK bonds rallied and UK stocks rallied as traders priced in deeper and earlier interest-rate cuts by the Bank of England after consumer prices rose less than expected in January. The jump in gilts saw UK 10-year yields fall 8bps to 4.07%. The FTSE 100 rose 0.8% and outperformed its European counterparts.

Europe’s Stoxx 600 began the session on a mixed footing and trade was generally tentative, before eventually moving into the green, rising 0.3% as the drug and grocery sector outperformed while miners lagged. ASML Holding NV said the semiconductor market has reached its nadir and there are now are signs of a rebound. Heineken NV shares slumped after the world’s second-biggest brewer warned that persistent inflation and economic worries will weigh on beer demand in 2024. ABN Amro Bank NV rallied after it unveiled a fresh share buyback with the Dutch state participating, as part of its planned sell down in the lender. Here are some of the most notable European movers:

• Capgemini shares gain as much as 4.2% after the French IT firm said its sales growth is expected to reach a trough in the first quarter as demand for tech projects recovers.
• Coca-Cola HBC shares rise as much as 6.5% after a yearly trading update, with analysts praising past investments and lower-than-expected cost guidance.
• ABN Amro shares jump as much as 6.3% after beating 4Q earnings estimates and announcing a €500 million share buyback. Analysts expect the bank’s targets to trigger consensus upgrades.
• Delivery Hero shares rise as much as 4.7% after issuing a trading update for the full year which soothed investor concerns, and achieved free-cash-flow breakeven in the 2H.
• Fresenius Medical Care shares rise as much as 5.2% after dialysis provider peer DaVita reported upbeat results for the fourth quarter.
• Bilfinger shares gain as much as 9.1% after the German industrial services firm forecast 2024 Ebita margin in the range of 4.9% to 5.2%, up from this year’s 4.3% level.
• ProSieben shares rise as much as 12% after the broadcaster reported preliminary Ebitda ahead of estimates and offered a more optimistic profit outlook compared with two months ago.
• Heineken shares fall as much as 6.5% in Amsterdam after the brewer reported full-year organic revenue that missed estimates.
• Norsk Hydro shares fall as much as 3.8% after the aluminum firm reported adjusted 4Q Ebit that missed estimates due to metal market costs.
• Castellum shares slide as much as 4.7% after the real estate investment company delivered mixed results. Morgan Stanley also highlighted the company’s elevated leverage.
• Thyssenkrupp shares fall as much as 10% after the steel company burnt through cash in the first quarter, casting doubt on its ability to deliver its full-year target.
• Entain shares fall as much as 5.2% after US joint-venture partner MGM Resorts reported falling revenue from its regional operations.

Earlier in the session, Asian stocks fell the most in four weeks, tracking an overnight selloff on Wall Street on tempered expectations for Federal Reserve interest-rate cuts after hot US inflation data: traders slased expectations for a Fed cut before July after the latest CPI print. Hong Kong stocks erased early losses as the market reopened after holidays. The MSCI Asia Pacific Index declined as much as 1.1%, with Toyota, Samsung and Commonwealth Bank among the biggest drags. Key measures fell more than 1% in Japan and South Korea, with losses also notable in Australia and India. Markets remained shut for holidays in mainland China and Taiwan, while Indonesia was closed for its presidential election.

• Hang Seng conformed to the risk-off mood on return from the holiday and with mainland Chinese markets shut.
• Nikkei 225 retreated with the biggest stock movers influenced by earnings results, although further losses in the index were somewhat cushioned by the recent currency weakness.
• ASX 200 declined with underperformance in the top-weighted financial sector after Australia’s largest lender CBA reported a drop in H1 profit and warned of financial strain from higher rates in 2024.
• Indian stocks ended the day higher, erasing intraday losses, with state-owned enterprises leading the charge even as technology stocks dragged. The S&P BSE Sensex rose 0.4% to 71,822.81 in Mumbai, after falling as much as 1% earlier, while the NSE Nifty 50  Index advanced by a similar measure. The MSCI AC Asia Pacific index ended 0.4% lower.  

“While a single data point does not make a trend, the relentless risk rally over the past months has left little room for error when it comes to the inflation fight,” said Jun Rong Yeap, a market strategist at IG Asia. “A surge in the US dollar and the negative handover from Wall Street offer reasons for some de-risking.”

In FX, the Bloomberg dollar index was slightly lower as the yen advanced after Japan’s currency officials warned authorities stood ready to take steps in the market if needed to curb rapid moves.

• USD/JPY slipped as much as 0.3% to 150.35, paring some of Tuesday’s 1% gain after Masato Kanda, vice finance minister for international affairs, said authorities are on call 24 hours a day, 365 days a year and are always ready to take appropriate steps as needed.
  • Finance Minister Shunichi Suzuki reinforced the view, with the comments coming after hotter-than-expected US consumer inflation data boosted the dollar to the highest level against the yen since November
  • “I would expect the weakness of the Japanese yen to probably last longer than we expected and most investors had hoped for,” Hebe Chen, analyst at IG Markets said on Bloomberg Television. The message from the Bank of Japan is that “they are still patient about their monetary policy”
• The Norwegian krone led currency gains, following data showing Norway’s economy expanded for a second quarter in a row at the end of last year
• The pound fell 0.4% versus the greenback and was the worst performing G-10 crrency after and traders priced in deeper and earlier interest-rate cuts by the Bank of England after inflation came in lower than expected

In rates, treasuries held a bull-steepening bias heading into early US session with front-end yields richer by around 5bp on the day. US 10-year yields around 4.29%, richer by ~3bp on the day. Front-end-led rally in Treasuries steepens 2s10s spread by 2.5bp, back toward middle of Tuesday range’s, while 5s30s widens 3bp, paring Tuesday’s aggressive flattening move. UK curve sees sharp steepening rally after a miss in UK CPI data prompted traders to price in deeper and earlier interest-rate cuts by the Bank of England. In 10-year sector gilts outperform by 5bp vs Treasuries; 2-year UK yields drop almost 10bp on the day. Move follows a front-end-led rally in gilts after UK consumer prices rose less than expected in January.  US session includes two scheduled Fed speakers and no major economic data.

In commodities, oil steadied after a mixed US inventory report, while OPEC and the IEA offered contrasting outlooks for the global crude market. WTI traded near $78 while gold was locked in a narrow range after plunging below $2,000 an ounce for the first time in two months while Bitcoin traded near the $50,000 mark.

Looking to the day ahead, in terms of data releases, we have UK January CPI, RPI, PPI and December house price, Eurozone Q4 GDP, employment, December industrial production, and Canada January existing home sales. We will also be hearing from the Fed’s Goolsbee and Barr, and the ECB’s Vujcic, Nagel, and Guindos, and earnings from Cisco, Sony, Occidental Petroleum, Kraft Heinz, Barrick Gold, Albemarle, and Twilio.

Market Snapshot

• S&P 500 futures up 0.3% to 4,988.50
• STOXX Europe 600 up 0.3% to 484.26
• MXAP down 0.4% to 167.42
• MXAPJ little changed at 510.82
• Nikkei down 0.7% to 37,703.32
• Topix down 1.1% to 2,584.59
• Hang Seng Index up 0.8% to 15,879.38
• Shanghai Composite up 1.3% to 2,865.90
• Sensex up 0.5% to 71,910.87
• Australia S&P/ASX 200 down 0.7% to 7,547.74
• Kospi down 1.1% to 2,620.42
• German 10Y yield little changed at 2.36%
• Euro little changed at $1.0705
• Brent Futures little changed at $82.73/bbl
• Brent Futures little changed at $82.72/bbl
• Gold spot down 0.1% to $1,990.46
• U.S. Dollar Index little changed at 104.89

Top overnight news

• Mike Gallagher, head of the US House China committee, will visit Taipei next week with a group of lawmakers in a show of support for Lai Ching-te ahead of his May inauguration as president of Taiwan. The hawkish Wisconsin Republican will arrive in Taiwan on February 21, according to three people familiar with his plan, including two Taiwanese officials who expect him to lead a delegation of seven US lawmakers. FT
• The yen weakened past 150 per dollar for the first time since November, prompting pushback from Japanese officials. The country’s top foreign exchange official Masato Kanda said speculative moves “aren’t desirable.” BBG
• Russian President Vladimir Putin’s suggestion of a ceasefire in Ukraine to freeze the war was rejected by the United States after contacts between intermediaries, three Russian sources with knowledge of the discussions told Reuters. RTRS
• UK CPI for Jan modestly undershoots the Street in Jan (core +5.1% vs. the Street +5.2% and headline +4% vs. the Street +4.1%), a relief for markets after the US reading on Tues. RTRS
• The ECB requires additional evidence that inflation is returning to its goal before it can safely begin loosening monetary policy, according to Vice President Luis de Guindos. BBG
• US crude inventories gained by 8.5 million barrels last week, API data is said to show. That would be the biggest increase since mid-November if confirmed by the EIA. Distillate supplies fell for a fourth week and gasoline stockpiles also dropped. BBG
• Tom Suozzi, a former Democratic congressman, won a closely watched special House election in New York on Tuesday, narrowing the Republican majority in Washington and offering his party a potential playbook to run in key suburban swing areas in November. NYT
• CIA Director William Burns concluded negotiations with top Middle Eastern officials on Tuesday without making major strides toward a deal between Israel and Hamas that would free hostages and pause fighting in the Gaza Strip, according to officials familiar with the talks. WSJ
• Jeff Bezos offloaded more than $4 billion in Amazon stock over four trading days, less than two weeks after disclosing a plan to dispose up to 50 million shares. Bezos hasn’t explained why he’s selling now, but he may be hoping to save on taxes. BBG

A more detailed look at global markets courtesy of Newsquawk

APAC stocks declined amid headwinds from the US where hot inflation unwound Fed rate cut expectations. ASX 200 declined with underperformance in the top-weighted financial sector after Australia’s largest lender CBA reported a drop in H1 profit and warned of financial strain from higher rates in 2024. Nikkei 225 retreated with the biggest stock movers influenced by earnings results, although further losses in the index were somewhat cushioned by the recent currency weakness. Hang Seng conformed to the risk-off mood on return from the holiday and with mainland Chinese markets shut.

Top Asian News

• Japan’s top currency diplomat Kanda said recent yen moves are rapid and is watching FX moves with a high sense of urgency, while he said they will take appropriate actions if needed on forex and are ready to take action on FX anytime 24 hours all year round. Furthermore, Kanda said rapid FX moves could have an adverse impact on the economy and he suggested appropriate responses to the weak yen could include intervention.
• Japanese Finance Minister Suzuki said he is watching the FX market with even stronger urgency and that rapid FX moves are undesirable, while he won’t comment on the FX level and intervention.
• Japanese Chief Cabinet Secretary Hayashi says will not comment on FX levels; important for currencies to move in stable manner reflecting fundamentals

European bourses, Stoxx600 (+0.3%) began the session on a mixed footing and trade was generally tentative, before eventually moving into the green. And love is in the air for the FTSE 100 (+0.8%), as weakness in the Pound (post-CPI) lifts the index off its feet. European sectors hold a mostly positive bias, with Media taking the spotlight, helped by significant post-earning strength in ProsibenSat (+9.2%). Basic Resources is hampered by broader losses in underlying base metal prices. US equity futures (ES +0.4%, NQ +0.6%, RTY +0.9%) are firmer across the board and attempting to pare back some of the prior day’s hefty losses, sparked by the hotter-than-expected CPI. The RTY outperforms after significant losses yesterday and as Bitcoin continues to advance past USD 50k.

Top European News

• ECB’s de Guindos says incoming data continues to signal weakness in the near term; some forward-looking survey indicators point to a pick-up in growth further ahead; deflationary process is continuing.
• ECB’s Vujcic says ECB seems to be getting the inflation fight right.
• German Economy Minister says German economic recovery may be delayed further by strikes, geopolitics, and weak foreign demand; inflation-dampening factors in Germany likely to persist over the rest of the year.
• German Direct Investments in China rose 4.3% Y/Y to a record high of EUR 11.9bln in 2023; investments in China as a share of overall German investments abroad rose to 10.3% – the highest level since 2014, according to IW Institute.
• UK ONS says UK House Prices -1.4% Y/Y in Dec (vs -2.1% in Nov)

Earnings

• Airbnb Inc (ABNB) – Q4 2023 (USD): Revenue 2.22bln (exp. 2.16bln), Gross booking value 15.5bln (exp. 15.2bln), Adj. EBITDA 738mln (exp. 643.5mln), Adj. EBITDA margin 33% (exp. 29.9%); to buy back up to 6bln of Class A common stock. Q1 revenue view 2.03-2.07bln (exp. 2.02bln). Shares -5.5% in the pre-market
• Thyssenkrupp (TKA GY) – Q1 (EUR): Revenue 8.18bln (exp. 8.8bln); cuts FY net profit guidance and now expects to break even (exp. +472mln; prev. “slight increase” ); Co. says the steel industry is currently facing a very challenging environment. COMMENTARY: Lower volumes of materials and raw materials had a negative impact. With lower volumes and prices overall, Materials Services posted a figure of EUR 2.9bln for both order intake and sales (prev. EUR 3.3bln and EUR 3.2bln, respectively) in a weak economic environment. Shipment volumes were stable compared with the prior year, order volumes decreased, mainly driven by lower demand from automotive customers. OUTLOOK: In a difficult market environment characterized by geopolitical and trade conflicts, ThyssenKrupp anticipates that macroeconomic development in the current fiscal year will be challenging overall. Shares -8.7% in European trade
• Capgemini (CAP FP) – FY23 (EUR): Net 1.66bln (exp. 2.15bln, prev. 1.55bln Y/Y), Revenue 22.5bln (exp. 22.6bln). To propose a renewal of Aiman Ezzat as CEO. Guides initial FY24 Revenue flat to +3%, Op margin 13.3-13.6%, Organic FCF 1.9bln. BoD has decided to recommend the payment of a dividend of EUR 3.4/shr. Shares +4.3% in European trade
• ProsiebenSat.1 (PSM GY) – Q4 (EUR): Adj. EBITDA 335mln (exp. 311.8mln), Revenue 1.28bln (exp. 1.3bln). Prelim FY23 Adj. EBITDA 578mln (exp. 554.2mln), Guides initial FY24 Adj. EBITDA 575mln (exp. 558.6mln). Shares +7.5% in European trade

FX

• DXY is overall steady but the USD is showing varying performance vs. peers. DXY has eclipsed yesterday’s peak of 104.96 but is yet to print on a 105.00 handle. Above which, there is clean air until 105.73 which was the November 14th peak.
• EUR printed a fresh YTD trough as the post-US CPI pressure on the pair continued. 1.0696 is the low print thus far with downside targets including the 14th November low at 1.0692.
• GBP is bottom of the pile across the major following softer-than-expected UK inflation metrics which have put an August cut back on the table. Cable fell to a trough of 1.2544 after taking out yesterday’s low of 1.2573 and the 200DMA at 1.2563.
• JPY is attempting to claw back some lost ground vs. the USD after printing a 2024 high at 150.88 yesterday; remarks from MOF & others in focus, but USD/JPY remains well above 150.00.

Commodities

• Crude is incrementally firmer and little changed following the US CPI, but still underpinned by geopolitics. On that note, reports this morning suggested escalating tensions between Israel and Lebanon, with one report stating “This morning’s attack on Safed by Hezbollah marked the most significant attack since the war’s onset.”
• Spot gold trade sideways and continues to hold beneath USD 2,000/oz, with the yellow metal awaiting impetus from geopolitics or Fed speak.
• Base metals are mixed but copper prices remain softer following the downbeat APAC mood, although newsflow remains quiet thus far and price volatility minimal.
• US Energy Inventory Data (bbls): Crude +8.5mln (exp. +2.6mln), Gasoline -7.2mln (exp. -1.2mln), Distillate -4.0mln (exp. -1.6mln), Cushing +0.5mln.
• EU Commission’s Sefcovic said after meeting White House officials that he understands the US pause in LNG export approvals will not affect US LNG shipments to Europe in the next two to three years.
• Citi says gold market seems biased to tactically correct to USD 1,925-50/oz at some point in the next 1-3 months
• Global LNG trade reached 404mln metric tons in 2023, according to Shell’s LNG outlook; China is likely to dominate LNG demand growth this decade; gas market remains structurally tight

Geopolitics: Middle East

• “Israeli media: Sirens sound for the third time in Safed”, according to Al Arabiya.
• Al Jazeera reporter notes “This morning’s attack on Safed by Hezbollah marked the most significant attack since the war’s onset.”
• “Israeli media: War Council discusses how to respond to heavy Hezbollah bombardment of Israel”, according to Al Jazeera.
• Israeli Minister of National Security Gvir calls on PM Netanyahu to hold an urgent meeting, says that “the shelling from Lebanon is not sporadic strikes but an actual war”, according to Al Jazeera

Geopolitics: Other

• North Korea fired multiple cruise missiles off its east coast, according to Yonhap.

US event calendar

• Nothing scheduled

Central Banks speakers

• 09:30: Fed’s Goolsbee Speaks in Q&A
• 16:00: Fed’s Barr Speaks at NABE Conference

DB’s Jim Reid concludes the overnight wrap

Happy Valentines’ Day to all our readers. The uneasy brokered agreement at home where we both agree not to give each other cards/gifts will be tested today as I have to work out whether I was actually expected to ignore that or not. I can guarantee that my wife will keep her side of the bargain!

US CPI certainly didn’t keep its side of the bargain yesterday as Cupid dropped his dovish arrows and instead delivered a red-hot inflation print. We’ll review it in more detail below but the print sent 10yr Treasury yields soaring up +13.5bps, the S&P 500 down -1.37%, the Russell 2000 (-3.96%) to its worst day since June 2022, and took out nearly a whole 25bps Fed cut by December.

Linked into this it’s fair to say my macro view has had to evolve over the last few months as a US recession around the end of 2023 looked less likely. First a reminder of the sequencing of my view in recent years to recap how I currently think about the macro world. In 2020/early 2021 when the money supply exploded at its strongest pace since WWII, it was pretty obvious that you would get high inflation that was far more than just supply side driven. As such we made an early, way out of consensus call that the Fed would have to raise rates to over 5% as we reached the start of their hiking cycle. From that point on it was pretty difficult to see how you could avoid a hard landing, given how far behind the curve the Fed was, albeit with an appropriate lag. I thought you would get a US recession by the end of 2023. However the GDP revisions last September did suggest that excess savings would now not run out until the end of 2024 rather than the end of 2023 and this was a little bit of a wakeup call for my view.

I started this year being most convinced that the combination of the perfect soft landing of the economy, with growth and inflation moving to trend and 6-7 cuts was unlikely. Although soft landing prospects had risen, the tails on either side of that remained elevated simply because the forces have been so big in either direction, especially alongside knowing that monetary policy lags are long and variable. We had the biggest increase in the US money supply since WWII and then the largest contraction since the 1930s, and the first since just after WWII. So to pad out the metaphor, to perfectly land the plane required you to program the steering wheel for landing, hours in advance, without knowing the exact nature of the very strong crosswind speeds at the airport. Once you got into your descent near the airstrip, your controls only helped you on your next take-off.

Of course it’s possible that everything can be perfectly calibrated, and the probabilities have gone up of late, but it still requires a huge amount of good fortune. Indeed the US CPI print hinted that there could be monetary overhang left in the system. This excess savings has helped the economy successfully survive over a year or so of very tight credit and lending standards. However does it also mean that inflation will struggle to make that final journey back to 2%? In conclusion while the soft landing outcome is still in the ascendancy, I would say a no landing scenario is under priced. It might not happen but the forces in both directions have been so big that the degree of certainty must be reduced as to which landing we get and therefore some hedging of bets is prudent.

Our US economics team’s reaction to the data is here but in brief we saw the headline CPI result come in at 0.3% month-on-month (vs 0.2% expected), with the year-on-year value at 3.1% (vs 2.9% expected). Core CPI, which excludes food and energy prices, rose 0.4% month-on-month (vs 0.3% expected), its highest value since last May. This brought the core CPI up to 3.9% year-on-year (vs 3.7% expected), reducing the already slim chances that the Fed will be lowering rates in the near-term.

Shelter caught everyone by surprise and increased 0.6% in January, the largest factor in the monthly increase in the core index. If that was the only anomaly, the report might have been seen as a one-off. But we also saw ‘supercore inflation’, which covers core services ex housing, rise to 4.3% YoY, its highest level since last May and with the largest monthly increase (+0.85%) since April 2022. So a major blow to the disinflation narrative in US services. The measure had been stalling at just under 4% in the last few months. Together with the strong nonfarm payrolls for January, this CPI report will give the Fed less confidence of sustainably reaching 2% inflation. Attention will next shift to the PPI print on Friday and whether its signal for PCE inflation, which the Fed targets, is any more sanguine. Note that some of the strong services CPI drivers (healthcare, airfares) do not enter PCE, instead being taken from the PPI. So there is still some hope for the inflation doves later this week.

A March cut was largely taken out of play after the number, as the probability of a 25bps cut fell from 18% to 11%. A full 25bps cut is now only just priced in by the June meeting. Overall, the market took out -24.6bps of expected cuts in 2024, with 87bps priced in by the December meeting as of yesterday’s close. That is down from a peak of 168bps on January 12, and nearing the 75bps of cuts pencilled by the median FOMC member in the last SEP in December. The broad dollar index (+0.76%) benefitted from the rates repricing, rising to its highest level in three months.

10yr Treasury yields shot up by nearly 16bps from its intraday low just before the data and slightly extended this rise later on to close +13.5bps higher at 4.315%, its highest level since late November. 2yr yields climbed +18.3bps to 4.66%, their largest rise since last March. Europe was not spared, as investors took out -11.3bps of expected ECB cuts to the December meeting, sending 10yr bund yields +3.3bps higher on the day and more than 6bps above their levels before the US CPI print. 10yr Gilts (+9.3bps) underperformed after earlier seeing stronger-than-expected wage and unemployment numbers. Next stop is this morning’s UK inflation just as this appears in your inboxes.

Adding to overall inflationary worries, WTI crude prices rose +1.24% to $77.87/bbl, and Brent +0.94% to $82.77/bbl. This increase came even as a monthly report by OPEC showed that there has been uneven delivery of its new quarterly production cuts in the first month of its new agreement.

Equity markets inevitably suffered against the day’s inflationary backdrop. The S&P 500 fell -1.37% on the day, slipping back under the 5,000 level. Things had looked even bleaker, with the S&P rallying in the final half an hour, having been around -2% down on the day. The selloff was broad, hitting smaller US corporates hard. The Russell 2000 dropped -3.96%, its largest daily decline since June 2022, and moved back into the red in year-to-date terms (-3.10%). This volatility sent the VIX up +1.9 points on the day, its largest rise since October. Technology also struggled, with the NASDAQ down -1.80% and the Mag 7 down -1.54%, although with Nvidia (-0.17%) once again surpassing Amazon (-2.15%) in terms of market capitalisation. The STOXX 600 also retreated, falling -0.95%.

One tech sector that’s performed strongly this year is the semiconductor one which is up +7.01% in the US YTD even if it was -2.01% yesterday. Marion Laboure and Cassidy Ainsworth-Grace, alongside the DB company analysts, have just published a 2024 outlook for the sector where they analyse the top three trends of this year, AI demand, economic cycles, geopolitics, and our equity outlook. See more here.

In Asia, the sell-off is fairly measured and hasn’t accelerated overnight. The KOSPI (-1.04%) is leading losses followed by the S&P/ASX 200 (-0.96%) and the Nikkei (-0.90%). Meanwhile, the Hang Seng (+0.15%) is reversing opening losses of around -1.8% after returning to trade from the Lunar New Year holiday. Outside of Asia, US stock futures are flat but with 2yr yields -3.8bps after yesterday’s bond rout with 10yr yields -1.4bps.

In FX, the Japanese yen (+0.25%) is trading slightly higher again against the dollar after spiking weaker through 150 after the US CPI print yesterday. Masato Kanda, Japan’s top currency official, indicated that the authorities would take appropriate action if needed to stem the weakness in the currency while describing the recent currency movement as rapid and speculative. At the same time, the yield on 10-year JGBs (+3.1 bps) briefly touched 0.765%, the highest since mid-December, possibly highlighting that US CPI increased the chances of an early move by the BOJ to raise interest rates. Elsewhere we await the results of the Indonesian election.

Additional data releases from yesterday included US NFI small business optimism, which fell to 89.9 (vs 92.3 expected) from 91.9 in December. In Europe, the Germany ZEW investor expectations for February rose to 19.9 (vs 17.3 expected) but current assessment fell to a bleak -81.7 yesterday (vs -79.0 expected), its weakest since the early months of Covid. Our German economists see continued weakness for the near to medium term and published a report yesterday detailing the disappointing Q1 sentiment data and downside risk to their already below consensus GDP forecast. If the US data hadn’t improved of late, they may have cut their pessimistic -0.2% 2024 GDP forecast further. See their report here.

Finally, to the day ahead, in terms of data releases, we have UK January CPI, RPI, PPI and December house price, Eurozone Q4 GDP, employment, December industrial production, and Canada January existing home sales. We will also be hearing from the Fed’s Goolsbee and Barr, and the ECB’s Vujcic, Nagel, and Guindos, and earnings from Cisco, Sony, Occidental Petroleum, Kraft Heinz, Barrick Gold, Albemarle, and Twilio.