Authored by James Rickards via DailyReckoning.com,

Are gold prices and interest rates joined at the hip? Based on recent market action, it would appear the answer is: yes.

A major rally in gold is now underway. Gold moved from $1,831 per ounce on Oct. 6 to $2,091 per ounce on Dec. 1, a 14.1% rally in just eight weeks and a new all-time high price for gold.

Gold has pulled back to $2,037 as of today, but that’s not surprising given its previous surge. Like every other asset, gold can sometimes get ahead of itself and experience a pullback. Importantly, it’s still holding firm above $2,000.

This rally correlated almost perfectly with the rally in 10-year Treasury notes that occurred at the same time. Treasury note rates plunged from 5.00% on Oct. 19 to 4.17% as of today. That 83-basis point drop may seem small but it’s not.

That’s like an earthquake in the world of Treasury notes. As explained below, market signs indicate that these dual rallies and close correlations will continue for months to come.

This dual rally gives investors a double-barreled opportunity to make huge gains.

DVO1: A Quirk of Bond Math

As interest rates drop, the market value of Treasury notes goes up. That’s bond math 101. Yet there’s a quirk in the bond math that many investors (and even financial advisers) don’t appreciate.

When interest rates drop, bond prices go up. But the rate at which they go up relative to each drop in rates (measured in basis points or 0.01%) isn’t constant.

The dollar value of the capital gain for each basis point drop in rates rises as interest rates hit lower levels. (The technical name for this is DVO1 for “dollar value of one basis point.” You don’t need to be expert on this; it’s just useful to understand the concept).

Put differently, if interest rates drop from 7.0% to 6.5%, notes have a capital gain. If rates drop from 4.0% to 3.5%, they also have a capital gain. In both cases, the rate drop is 0.50%. But the capital gain in the second case is materially larger than in the first case.

Right now, we’re in that zone where rates are low and going lower, which means the capital gains are getting larger. That’s a big win for investors on a security with almost no credit risk.

What Explains the Gold Rally?

What accounts for the rally in gold prices? There are numerous factors that affect the gold price, but certain factors dominate at certain times. Right now, the key factor is interest rates. Rates are going down at a rapid pace and gold is going up in a kind of synchronicity. Why?

The simplest explanation for the correlation is that Treasury notes and gold are both high-quality assets that compete for investor allocations. Gold does not have a yield (although it can produce significant capital gains).

When yields on Treasuries drop, the zero yield on gold is relatively more attractive compared with the note yield and gold prices start to rally.

The key questions for investors are: Will rates continue to drop? And will gold continue to rally in sync with falling rates?

To forecast rates, we have to look at economic fundamentals. (By the way, the Federal Reserve is almost irrelevant for this purpose. The Fed controls the short end of the yield curve only and has almost no impact on longer-term rates including the 10-year Treasury note rate we are considering here.)

One conundrum of recent U.S. economic performance is that GDP has remained robust while signs of a recession and possible a financial crisis keep accumulating.

The Trend Isn’t the Economy’s Friend

U.S. GDP was 2.2% in the first quarter of 2023, 2.1% in the second quarter and a strong 4.9% in the third quarter. The best estimate for fourth-quarter growth from the Atlanta Fed is currently 1.2%, a substantial drop from the third quarter.

If that Q4 figure holds, growth for the entire year of 2023 will come in around 2.5%. That’s not too shabby, and it’s slightly better than the 2.2% average annual growth from 2009–2019 in the 10-year period between the global financial crisis and the pandemic.

In any case, it’s a far cry from a recession.

Still, a focus on full-year growth of around 2.5% ignores the trend. When growth goes from 4.9% in the third quarter to 1.2% in the fourth quarter, something extreme happened. It’s almost certainly the case that consumers slammed on the brakes in October.

Recession signs are real and growing worse. These include credit contraction, rising bad debts, increasing jobless claims, collapsing commercial real estate markets, contracting world trade, inverted yield curves and many other reliable technical indicators.

How can the economy be headed into recession after such strong growth recently?

The Credit Crunch Reckoning Begins

The riddle is solved by the fact that the economy has been propped up by the consumer. That explains the growth. But the consumer has been on a non-sustainable path. That explains the warning signs.

The consumer came out of the pandemic with a head of steam provided by handouts from Trump ($1,800 per adult), and Biden (also about $1,400 per adult) between April 2020 and March 2021. That was supplemented by $900 billion of Paycheck Protection Program loans, which were forgiven one year later.

Student loan payments were suspended from 2020–2023. The Federal Reserve held interest rates at zero from 2020–2022. Then the misnamed Inflation Reduction Act of August 2022 handed $1 trillion of taxpayer money to Green New Scam businesses and other pet projects.

With that money, Americans were able to pay down credit card balances and build up savings. It was a powerful double-dose of fiscal and monetary stimulus. Much of this operates with a lag so the growth momentum carried over into 2023.

Now it’s all gone. Short-term interest rates are over 5%. Mortgage rates are over 7%. Student loan repayments have started again. There are no more pandemic handouts. Americans’ savings are depleted, and their credit cards are tapped out.

Now the reckoning begins. In fact, the recession may already be here.

Bad Omens

Interest rates do not typically peak at the start of a recession; they peak somewhat after the recession begins. Businesses see revenues decline and turn to lines of credit to help with cash flow.

Only later, when unemployment goes up and credit losses accumulate, do banks rein in credit and then interest rates start to decline. We may already be at that stage. The fact that interest rates are already in sharp decline suggests the recession has already begun.

The importance of this for investors is that interest rate declines have much further to go (probably down to the level of 2% or lower over the next six months), which means gold prices have further to rise (perhaps to the $2,300 per ounce level or higher).

With both trends in place and a positive feedback loop between them, this is a once-in-a-decade opportunity for investors.

It really doesn’t get much better than that!

The CEO of startup incubator Y Combinator, a registered Democrat, criticized his own party’s failed progressive policies by stating on X that police in San Francisco need to be ‘fully funded’ and judges need to ‘enforce law and order.’ 

Garry Tan stated three points that San Fran lawmakers need to U-Turn on to ensure the metro area stops plummeting into a hellhole of violent crime: 

• Fully fund the police
• Reform the police commission
• Vote out the judges who won’t uphold the law and justice

Tan said the chaos in San Fran is “fixable, but it is not fixed.” 

In San Francisco we must:

– Fully fund the police
– Reform the police commission
– Vote out the judges who won’t uphold the law and justice

It’s fixable but it is not fixed https://t.co/96Os9hrUmj

— Garry Tan 陈嘉兴 — e/acc (@garrytan) December 8, 2023

Well, crime and homeleness only disappear when Chinese President Xi Jinping visits. 

San Francisco finally fixed the homeless crisis. All it took was a visit from a world dictator.

Before Xi: After: pic.twitter.com/2WimoNHC49

— End Wokeness (@EndWokeness) November 12, 2023

REPORT: The San Francisco homeless population has “miraculously” gone missing as President Biden & Chinese President Xi Jinping are set to meet in the liberal city.

Remarkable!

The typical drug addicts & homeless who wander the city like zombies have disappeared as 20,000… pic.twitter.com/2iDpl4FHCG

— Collin Rugg (@CollinRugg) November 11, 2023

After Xi’s visit, San Fran is back to the usual… 

📍 Sun Valley Mall • Pleasant Hill, California pic.twitter.com/bIT6MfIkco

— Clown World ™ 🤡 (@ClownWorld_) December 7, 2023

The San Francisco Standard said he is a “registered Democrat” and has recently “fashioned himself into San Francisco’s preeminent political pitbull, an attack dog with a taste for progressives.” 

Democrats criticizing Democrats for San Fran’s demise has been a new phenomenon. A number of tech bros have come to terms with their own political party that has done nothing more than ruin cities with disastrous social justice reforms. 

Tan, along with PayPal co-founder David Sacks and William Oberndorf, owner of Shorenstein real estate, led the 2022 movement to recall former Soros-backed District Attorney of San Fran Chesa Boudin.  

The crime situation in San Fran is so bad that the radical progressive mayor, London Breed, had to save face over the summer and U-Turn on defunding the police. 

Democrats turning on their own party for ruining American cities is an epic sight to see ahead of the 2024 presidential election cycle. 

Authored by Paul Joseph Watson via Modernity.news,

Comedian Bill Burr told talk show host Jimmy Kimmel that liberals are “fucking stupid” to have turned Trump into a martyr and that “he’s coming back” for revenge.

Burr made the comments in the context of saying how he’d teach his kids about narcissists and sociopaths.

“If you wanna see a great case on narcissism, liberals are so fucking stupid the way they handled Trump – you should shut up!” said Burr, adding “he’s a narcissist – neutral energy – neutral.”

Kimmel, who had one of the most severe cases of Trump derangement syndrome for years, wondered if the Donald would “go away” if leftists ignored him.

BILL BURR: “Liberals are so f**king stupid the way that they handled Trump…You should shut up…! You idiot liberals…indicted him! And now he’s a martyr!”

pic.twitter.com/ORSMQo9Baq

— Benny Johnson (@bennyjohnson) December 7, 2023

Burr suggested that Trump was fading away until “you idiot liberals…indicted him and now he’s a martyr,” adding, “He’s coming back, Jimmy! He’s coming back! It’s gonna be great for comedy – he’s coming back!”

The comedian went on to assert that he wanted to vote for someone in their 40’s for president who would have to “live with their decisions.”

“With any luck, they’ll both die of natural causes before the election and maybe you could get somebody that still has something to live for,” said Burr, referring to Biden and Trump.

Kimmel then tried to move the show on quickly while Burr exclaimed, “Wait a minute!”

Maybe Burr should give the same advice to his own wife, who very much appears to be suffering from her own clinical case of Trump derangement syndrome too.

*  *  *

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Update (0925ET): The unwind of the unwind of the kneejerk reaction is now in play: USD up, gold down; stocks and bonds (prices) down…

*  *  *

Flat wage growth (hotter than expected MoM), lower unemployment rate (good news is bad news), more jobs added (good news is bad news)… but the narrative-delivers claim “goldilocks”.

This looks anything but goldilocks and the kneejerk reactions agreed with rates and the dollar higher (hawkish) and stocks lower.

Wall Street is also not buying the Goldilocks spin:

BMO Capital Markets’ Ian Lyngen:

“Overall, it was a strong report that has predictably reduced the odds of a March cut to <50% territory.”

FHN’s Chris Low:

“The employment report suggests emerging weakness apparent in October was primarily a reflection of strike activity rather than a sudden economic chill. Bear in mind, October’s exaggerated weakness is likely mirrored by an equal-and-opposite temporary strength reflecting the post-strike bounce. Nevertheless, three-month average payroll rise of 204,000 is respectable. That it was confirmed by a better-than-expected household survey is just icing on the cake.”

Dominic Konstam, head of macro strategy at Mizuho Securities, says:

“Clearly the early Fed easing cycle risk is put back and the labor market is slowing, is well off strength in early 2023, but not the extreme weakness seen in October.”

Deutsche Bank’s Alan Ruskin says:

“The data definitely works with rhetoric that the tightening cycle may not be over, even if this is regarded as unlikely, and that it is premature for officials to be talking about easing. In short, the data extends the likelihood of a longer than usual plateau in rates.”

Rubeela Farooqi, chief US economist at High Frequency Economics:

“In terms of Fed policy, we do not think these data change the outlook; rates are at a peak and the Fed’s next move will be a rate cut, likely by the middle of next year.”

Neil Dutta of Renaissance Macro Research says:

“The US labor markets are fine. November’s employment figures were firmer than expected and as a result, bond yields are rising. (People saying recession need to have their heads examined).

“However, in our view, the labor market is not the primary driver for monetary policy right now. Indeed, there is an asymmetry in the Fed’s policy reaction function: stronger employment will not push them away from a cut as much as weaker inflation will push them towards one. The solid economy puts a ceiling on how many cuts we’ll get, but it will not stop cuts altogether. That’s what a recalibration of policy is about.”

Mohamed El-Erian, Allianz’s chief economic adviser and a Bloomberg Opinion columnist, says on Bloomberg TV:

“That was good news for the economy, and further confirmation that the US has an exceptional labor market and an exceptional economy.

You saw significant job growth, higher wage growth and higher labor participation,” he says. “The market has to think very carefully about the amount of cuts next year.”

And sure enough, that initial kneejerk has basically all been unwound now.

Dollar is down…

Gold is reversing higher,..

Bond yields are falling back from the kneejerk higher…

The payrolls print was right in the middle of Goldman Sachs’ sweet-spot for stocks and they are still holding on to post-payrolls gains (though only Small Caps are in the green)…

The odds of a rate-cut in March dropped from around 60% to around 50%…

Still a long way to go for these narratives to be rewritten today.

Ahead of today’s jobs report (which we previewed as being focused mostly on the unemployment rate), we said that the whisper was for a stronger report due to the mandatory political talking points for the White House taking credit for all those strikers coming back to work…

Whisper is stronger number due to impact of strikers returning to work and required political talking points

— zerohedge (@zerohedge) December 8, 2023

… and lo and behold, that’s precisely what happened, with the total number of job gains in November coming in at 199K, above last month’s 150K and, more importantly, well above the consensus forecast of 183K.

This number included about 47K formerly striking auto and motion picture workers (see below for details).The BLS noted that “job gains occurred in health care and government. Employment also increased in manufacturing, reflecting the return of workers from a strike”, which as we noted above will be today’s White House main talking point. Still as Omair Sharif, founder of Inflation Insights LLC, notes, “if you strip out the strike impact, over the last two months, private payrolls averaged 118,000. That compares with a six-month average of 130,000. So the direction of travel is weaker. The pace is “relatively soft” and will probably be welcomed by the Fed.”

Of course, as has been the case every month this year, previous months’ data was revised lower, with September down by 35K from 297K to 262K and October remaining flat at 150K (the BLS is getting a little “shy” of all these downward revisions taking place the next month) and will instead be revised lower in January. So expect today’s “beat” to be revised to a miss next month… when it won’t matter.

Still, the number was solid especially when considering that the number of employed workers as counted by the Household survey surged by 747K to 161.969 million, following several months of disappointing prints, including last month’s 348K drop, and rising to the highest on record. This was the third biggest increase in the Household survey this year.

But more importantly, recall that as we explained in our preview, a 4.0% unemployment rate after last month’s 3.9% would have triggered the popular “Sahm’s rule” recession indicator (which is why there was more attention on the unemp rate than even the NFP number), and sure enough the BLS reported that the unemployment rate actually dipped 3.7%, well below the estimate of 3.9%.

The drop in the unemp rate was thanks to the abovementioned jump in employed workers, which surged by 747K to 162 million, as well as the increase in the participation rate, which rose to 62.8%…

… while the number of unemployed workers actually dropped by 215K, to 6.3 million.

Turning the wages, the monthly increase was slightly higher than expected as average hourly earnings for all employees rose by 12 cents, or 0.4% to $34.10, higher than the 0.3% expected with only 3 out of 62 forecasts in the Bloomberg survey calling for a 0.4% gain in average hourly earnings. Everybody else was slower than that. Over the past 12 months, average hourly earnings increased by 4.0%, in line with expectations and unchanged from the downward revised 4.0% in October. At the same time, average hourly earnings of private-sector production and nonsupervisory employees rose by 12 cents, or 0.4 percent, to $29.30.

Some more details from the jobs report:

• The number of persons employed part time for economic reasons decreased by 295,000 to 4.0 million in November. These individuals, who would have preferred full-time employment, were working part time because their hours had been reduced or they were unable to find full-time jobs.
• In November, the number of persons not in the labor force who currently want a job was 5.3 million, little different from the prior month. These individuals were not counted as unemployed because they were not actively looking for work during the 4 weeks preceding the survey or were unavailable to take a job.
• Among those not in the labor force who wanted a job, the number of persons marginally attached to the labor force changed little at 1.6 million in November. These individuals wanted and were available for work and had looked for a job sometime in the prior 12 months but had not looked for work in the 4 weeks preceding the survey. The number of discouraged workers, a subset of the marginally attached who believed that no jobs were available for them, was 421,000 in November, essentially unchanged from the previous month.

Looking at the composition of jobs, the big highlight is that manufacturing payrolls rose 28k after falling 35k in the prior month, reflecting the return of workers from a strike.

A closer look at other industries reveals the following:

1. In November, health care added 77,000 jobs, above the average monthly gain of 54,000 over the prior 12 months. Over the month, job gains continued in ambulatory health care services (+36,000), hospitals (+24,000), and nursing and residential care facilities (+17,000).
2. Government employment increased by 49,000 in November, in line with the average monthly gain of 55,000 over the prior 12 months. Employment continued to trend up in local government (+32,000) and state government (+17,000) over the month.
3. Employment in manufacturing rose by 28,000 in November, reflecting an increase of 30,000 in motor vehicles and parts as workers returned from a strike.
4. In November, employment in leisure and hospitality continued to trend up (+40,000), almost entirely in food services and drinking places. This is amusing considering ADP reported just the opposite.
5. Employment in social assistance continued to trend up in November (+16,000). The industry had added an average of 23,000 jobs per month over the prior 12 months. Over the month, employment continued to trend up in individual and family services (+9,000).
6. Retail trade employment declined by 38,000 in November and has shown little net change over the year. Employment decreased in department stores (-19,000) and in furniture, home furnishings, electronics, and appliance retailers (-6,000) over the month.
7. In November, employment in information changed little (+10,000). Motion picture and sound recording industries added 17,000 jobs, mostly reflecting the resolution of labor disputes in the industry. Overall, employment in the information industry has declined by 104,000 since reaching a peak in November 2022.
8. Employment in transportation and warehousing changed little in November (-5,000). A job loss in warehousing and storage (-8,000) was partially offset by a gain in air transportation (+4,000). Employment in transportation and warehousing has declined by 61,000 since a peak in October 2022.

Employment showed little change over the month in other major industries, including mining, quarrying, and oil and gas extraction; construction; wholesale trade; financial activities; professional and business services; and other services.

According to Bloomberg, payroll gains this month were broader than in October. The diffusion index — which measures how many industries are hiring — rose to 63.4% last month from 52.2% in October.

Commenting on the report, Wall Street was generally happy with the numbers:

• Dominic Konstam, head of macro strategy at Mizuho Securities: “Clearly the early Fed easing cycle risk is put back and the labor market is slowing, is well off strength in early 2023, but not the extreme weakness seen in October.”
• Priya Misra, portfolio manager at JP Morgan Investment Management:  “Strong number, solid wages and higher participation should keep the soft landing narrative alive. We knew that strikes would add to this number. Some of the near-term Fed rate cuts will get taken out but we think people will buy the dip. Not many had the opportunity to buy 10y Treasuries at 5% but even 4.25% is not a bad level heading into a slowing growth and inflation world. Good number for risk assets.”
• Ira Jersey, Bloomberg Intel rates strategist: “The better-than-expected employment report may cause the market to price out some early-2024 rate cuts and bear flatten the yield curve. Next week’s CPI will be needed for confirmation, but unless core CPI falls a lot, we think perhaps the bottom of a near-term yield range has been set about 4.1% on the 10-year Treasury.”
• Dennis DeBusschere, founder of 22V Research: “too strong on the day across the board. Not a disaster at all for markets though. Clearly rates are highly unlikely to move much lower from here given the payroll data. That being said, it is not a done deal that the Fed needs to push back aggressively against the recent FCI easing. If CPI still trends lower, one stronger-than-expected payroll report is not an issue. A bunch of strong payroll reports and wages staying at current levels would be a clear issue.”
• Omair Sharif, founder of Inflation Insights LLC: “if you strip out the strike impact, over the last two months, private payrolls averaged 118,000. That compares with a six-month average of 130,000. So the direction of travel is weaker. The pace is “relatively soft” and will probably be welcomed by the Fed.”
• Ali Jaffery, economist at CIBC Capital Markets: “Today’s report will certainly raise some eyebrows in the FOMC and is a reminder that the labor market remains tight. But with inflation persistence less of a challenge, the Fed will continue to remain patient.”
• Ana Galvao, Bloomberg economics: “The drop in the unemployment rate was unexpected, but once the dust settles Bloomberg Economics’ Macro-Finance SHOK tool, suggests the impact on yield forecasts will be muted. The model shows an upward move in 10-year Treasury yields of less than 1 basis point over the medium term.”
• Alan Ruskin, chief international strategist at Deutsche Bank: “3mo averages of private NFP are quite stable, consistent with growth down a notch but no major deceleration. Three-month annualized measures of aggregate hours worked are very steady, consistent with the idea that underlying growth is more stable rather than decelerating significantly…. The data definitely works with rhetoric that the tightening cycle may not be over, even if this is regarded as unlikely, and that it is premature for officials to be talking about easing. In short, the data extends the likelihood of a longer than usual plateau in rates.””
• BMO Capital Markets’ Ian Lyngen: “Overall, it was a strong report that has predictably reduced the odds of a March hike to <50% territory.”
• Rubeela Farooqi, chief US economist at High Frequency Economics: “In terms of Fed policy, we do not think these data change the outlook; rates are at a peak and the Fed’s next move will be a rate cut, likely by the middle of next year.” 
• Neil Dutta of Renaissance Macro Research: “The US labor markets are fine. November’s employment figures were firmer than expected and as a result, bond yields are rising. (People saying recession need to have their heads examined). However, in our view, the labor market is not the primary driver for monetary policy right now. Indeed, there is an asymmetry in the Fed’s policy reaction function: stronger employment will not push them away from a cut as much as weaker inflation will push them towards one. The solid economy puts a ceiling on how many cuts we’ll get, but it will not stop cuts altogether. That’s what a recalibration of policy is about.”
• UBS strategist Simon Penn: “Fed’s Powell Can’t Be Anything Other Than Hawkish. Fed Chair Powell’s message next week is going to have to reference: the continued strength of the labor market, the continued strength of wage growth, and the persistence of inflation (core CPI is likely to print 4.0% on the first day of the FOMC meeting).Meanwhile, the decline in yields since November’s meeting rather undermines the prior argument of yields being a form of financial tightening.It is hard to find the circumstances under which Powell says anything other than: It’s far too early to think about cuts; policy will need to remain restrictive; inflation remains well above target; the Fed will need to see a period of sub-trend growth.Relative to the pricing markets have talked themselves into, that’s all going to sound pretty hawkish.”

Finally, the number is largely in line with Goldman’s market reaction matrix sweet spot:

• >250k S&P sells off at least 50bps
• 200k – 250k S&P sells off 25 – 50bps
• 150k – 200 S&P + / – 25bps
• 50k – 150k S&P rallies 100+bps
• <50k S&P sells off at least 50bps

And with payrolls largely a non-event (especially after this week’s dismal labor market reports) attention now turns to next week’s CPI report.

Authored by Simon White, Bloomberg macro strategist,

The bonds of European countries are among the most overbought following the global rally in fixed income, and are therefore most susceptible to a correction.

Yields have fallen almost everywhere since October. Oversold conditions led to a reversal in the bond selloff, further galvanized by central bankers from the Federal Reserve to the ECB tempering their hawkishness based on their view that inflation is probably back under control.

The biggest drops in yields, after Brazil, have been in Italy, Ireland and Austria. Germany and France have also seen large declines, greater than in the US or the UK.

How overbought does that leave individual bond markets? To answer that we can take the Bloomberg aggregate indices for countries around the world. The aggregate indices are made up of corporate and government debt.

Using the RSI as a gauge of overboughtness (it is imperfect as a trading signal, but is a good first filter for markets that may be cheap or expensive), we can see that many European countries have potentially extended bond markets. For example, the bond markets of Switzerland, Belgium, Netherlands and France are all overbought on this measure (14-day RSI > 70), and are more so than the US.

As with the US, the drop in yields in Europe has been driven by rising expectations of fairly deep rate cuts next year, with over 140 bps worth currently discounted.

The ECB is increasingly comfortable with the inflation outlook, with noted hawk Isabel Schnabel recently softening her stance.

However, the growth outlook for Europe may not be so bleak next year (GDP for the last quarter was confirmed today as falling 0.1%), as real M1 growth, which leads economic growth by about six months, looks like it has stabilized and started to turn up. Further, leading indicators of inflation, such as PMI input prices, are also hinting that inflation may not be done and dusted as several in the ECB appear to believe.

Again, as with the US, far fewer — if any — cuts may actually be delivered, leaving overbought European bond markets subject to another reversal.

Authored by Tsvetana Paraskova via OilPrice.com,

• Last week, the European Commission proposed an action plan to make sure “electricity grids will operate more efficiently and will be rolled out further and faster.” 

• Range anxiety has been one of the hurdles to a faster adoption of electric vehicles.

• Toyota Europe’s chief operating officer Matt Harrison has recently said that Europe still needs work to do in charging infrastructure to reach the tipping point for significantly boosting the share of EVs. 

Burdensome permitting processes and the need for extra grid connections and power capacity are slowing down the installation of EV charging stations across Europe, threatening the EU’s ambition to rely on transport electrification as a pillar of its net-zero target.  

The EU adopted early this year legislation to make all new cars and vans registered in Europe zero-emission from 2035. The European Commission has also just proposed an action plan for grid investments across the bloc, aiming to upgrade grids, strengthen energy infrastructure, and allow faster access for renewables to the grids. 

Despite the EU ambitions and the EU-wide legislation, local-level regulations and requirements to have a charging point hooked up to the grid sometimes takes years, and the delays have become longer in recent years, energy companies and industry associations tell Reuters. 

“Although the work of installing a fast and ultra-fast charging point requires only two to three weeks of work, due to different administrative requirements in Spain, the complete process … can last from one to two years,” Spanish energy firm Repsol told Reuters.  

The red tape in Germany, Europe’s largest car market, is similarly burdensome, industry sources say. 

EU Plan to Upgrade Electricity Grids

Last week, the European Commission proposed an Action Plan to make sure “electricity grids will operate more efficiently and will be rolled out further and faster.” 

A total of 40% of EU distribution grids are more than 40 years old. Cross-border transmission capacity is set to double by 2030, and this will need $633 billion (584 billion euros) in investments, the Commission said.

“Networks will have to accommodate a more digitalised, decentralised and flexible system with millions of rooftop solar panels, heat pumps and local energy communities sharing their resources, more offshore renewables coming online, more electric vehicles to charge, and growing hydrogen production needs,” the EC added. 

Kadri Simson, the European Commissioner for Energy, said “Grids need to be an enabler, not a bottleneck in the clean energy transition. That way we can integrate the vast amounts of renewables, electric vehicles, heat pumps and electrolysers that are needed to decarbonise our economy.” 

In response to the plan, renewable industry associations called for urgent actions.  

“Serious action is needed asap to tackle the huge and growing queues of renewables that are waiting for a grid connection. The system operators in Europe need help here. Some of them have connection queues of hundreds of GW of wind and solar projects,” the WindEurope association said.

Rules for More Charging Stations 

This summer, the European Parliament successfully negotiated that electric charging pools for cars with a minimum 400 kW output will have to be deployed at least every 60 kilometers (37 miles) along core TEN-T network routes by 2026, with the network’s power output increasing to 600 kW by 2028. For trucks and buses, charging stations have to be provided every 120 km (75 miles). These stations should be installed on half of main EU roads by 2028 and with a 1400kW to 2800 kW power output depending on the road. EU countries will also have to ensure that hydrogen refueling stations along the core TEN-T network will be deployed at least every 200 km (124 miles) by 2031. 

Range anxiety has been one of the hurdles to a faster adoption of electric vehicles.  

The EU now has the plans, but it’s up to individual member states to accelerate permitting, including for construction and access of charging stations to the grid. 

“The time needed for connecting the EV recharging points to the grid can indeed be seen as a barrier to accelerate the uptake of EVs and needs to be tackled,” a spokesperson for the European Commission told Reuters in an email. 

Municipalities are slow with permitting, while grid operators and power distributors don’t have uniform requirements for charging stations, which could delay the rollout, industry managers say.

“There is a clear need for more standardization,” Stefan van Dobschuetz, vice president of BP Pulse Europe, told Reuters.

BP Pulse, the EV charging business of BP, has an ambition to have more than 100,000 chargers installed worldwide by 2030 focused on ultra-fast charging. 

ChargeUP, the industry association, has been calling for standardization and fast deployment of charging infrastructure across Europe. 

The largest bottleneck charge point operators (CPOs) face across Europe today “is the amount of time it takes to establish a grid connection point, the complexity of the process to get one, and access to sufficient grid capacity,” the association says.

More than 20 CPOs across Europe have signed an open letter to propose five criteria benchmarking permitting processes that would harmonize and standardize the process of getting a grid connection in Europe.  

Toyota Europe’s chief operating officer Matt Harrison has recently said that Europe still needs work to do in charging infrastructure to reach the tipping point for significantly boosting the share of EVs. 

“The enablers are not really fully there yet, so I’m not surprised we’re having a bit of a wobble,” Harrison told Bloomberg in an interview this week. 

“There are a lot of fundamentals that still need to be fixed before we start to move.” 

Authored by Albin Sadar via American Greatness,

The release of more video and cell phone tapes from January 6 by new House Speaker Mike Johnson shows further evidence of a setup by the Feds that their so-called insurrection was staged.

All sides will acknowledge the fact that then-Speaker Nancy Pelosi refused to have extra security on January 6.

However, there is a bigger question that no one, Left, Right or Center, seems to be asking:

Why?

Why wouldn’t Pelosi want to be sure that “Democracy was secure” so that Vice President Mike Pence could certify the Electoral College vote? Making sure that the Capitol was safe and sound would mean that Joe Biden’s presidency would be assured. After all, the election of 2020 was “the most secure in American history,” so why wouldn’t you want that obvious fact certified and rubber-stamped by Congress?

The only obvious answer to why Pelosi wanted to guarantee a riotous breach of the Capitol was what she knew would be the actual results of the Electoral College vote if the process were allowed to run its course. Senators Ted Cruz and Josh Hawley, among others, had previously made noise about challenging election results in several swing states. And despite what many have debated, there was tangible potential for Pence to delay the certification for a couple of weeks to look into the evidence of significant vote-tampering and fraud.

How do we know that the vice president had the authority to stop the certification? Well, because the ability for the position of vice president to do just that was changed by a vote of Congress relatively recently after the events of January 6. Why would you change something that did not need to be changed?

So, at the time, Pelosi knew that a halt in the proceedings would lead to an investigation. And an investigation would lead to those questions being covered, albeit reluctantly, by the entire mainstream media. What actually transpired over the three additional days of counting in the 2020 Election would be exposed. And the narrative of the most secure election in American history would crumble in front of the eyes of everybody in this country and across the globe.

To this day, then, as the new Speaker takes a serious look at the events of January 6 and as America and the world itself can see exposed in the recently-released video evidence, we must address what happened that particular day – specifically, the reason that the crowds of tens of thousands had gathered. The patriots in Washington, D.C. showed up to highlight one very important message: “Stop the Steal.”

Pelosi’s action – as well as inaction – diverted attention from that message; she refocused our sights on the word “insurrection” in order to keep President Donald Trump from returning to the White House as a result of the true, states’ election totals of 2020. And the Left continues nonstop that charade in order to keep Trump from the White House in 2024.

With each passing day, it is becoming increasingly apparent that the two biggest blemishes recently on America as a great and free nation are the stolen presidential election of 2020, and the subsequent incarceration of those patriots who exercised their guaranteed First Amendment right to free speech to contest it. The election tampering advanced the Left’s directive of “fundamental transformation” of the country, which included imprisonment without bail or trial of those with whom the tyrannical administration disagreed.

So, what next?

Unless the country itself can see that the narrative presented by the Left regarding January 6, 2021, was a smoke screen for the real insurrection of November 3, 2020, America will need to brace itself for a repeat performance of that nefarious action on November 5, 2024.

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Albin Sadar is author of Obvious: Seeing the Evil That’s in Plain Sight and Doing Something About It, as well as the children’s book collection, Hamster Holmes: Box of Mysteries.