Treasury Secretary Janet Yellen says the United States would be “responsible for Ukraine’s defeat” if Congress fails to approve the Biden administration’s $106 billion request to fund the wars in Ukraine and Israel, among other security issues.

Yellen made the remarks Tuesday to reporters while on a trip to Mexico City, calling the funding “utterly essential” and as a pre-condition for the International Monetary Fund to keep funds flowing uninterrupted into Ukraine, according to Reuters.

“I’ve talked to members of Congress, my colleagues have. I think they understand this, that this is a dire situation and we can hold ourselves responsible for Ukraine’s defeat if we don’t manage to get this funding to Ukraine that’s needed, and I’m including direct budget support here because that’s utterly essential,” Yellen said.

She issued the rebuke the same day that President Zelensky’s chief of staff said something very similar before a security conference in D.C.

Ukraine aid will stop flowing in a matter of three weeks. Zelensky’s chief of staff Andriy Yermak said the following words Tuesday: 

If the United States postpones military aid to Ukraine, there is a “big risk” the country could lose its war with Russia, Ukrainian President Volodymyr Zelenskyy’s chief of staff Andriy Yermak said Tuesday. 

Speaking at the U.S. Institute for Peace during a visit to Washington, Yermak said failure by Congress to approve more aid to Ukraine could make it “impossible” to liberate more territory captured by Russia and “give the big risk to lose this war.”

“If the help which (is) now debating in Congress will be just postponed. … It gives the big risk that we can be in same position (where) we’re located now,” said Yermak, speaking in English.

“That is why it is extremely critically important that this support will be voted and will be voted as soon as possible,” he said.

But the reality is that Ukrainian forces were already losing the war, given top US officials have long acknowledged the counteroffensive has stalled and failed, even with all the weapons the US has already poured in.

NOW – Biden: “Congress needs to pass supplemental funding for Ukraine before they break for the holiday.”pic.twitter.com/DfEOhb6Y9w

— Disclose.tv (@disclosetv) December 6, 2023

Thus Yermak’s statements seem more like an early blame-game: Ukraine seems to be saying it will be Washington’s fault when the war is lost and Kiev is forced to finally negotiate and cede territory. And Yellen says she agrees.

Authored by Steve Watson via Modernity.news,

Independent presidential candidate Robert F. Kennedy Jr. admitted Tuesday that he twice flew on the private jet of pedophile fixer to the global elite Jeffrey Epstein.

Kennedy also revealed that his ex-wife was friends with Epstein’s ‘madam’ Ghislaine Maxwell.

During the interview, RFK Jr. was asked by Jesse Watters if he’s ever flew on Epstein’s notorious ‘Lolita Express’, to which he responded “I was on Jeffrey Epstein’s jet two times,” adding “I was on it in 1993, and I was on it in– and I went to Florida with my wife and two children to visit my mom over Easter.”

RFK Jr. admits he flew on Jeffrey Epstein’s ‘Lolita Express’ jet and hung out with the pedo on a “fossil hunting” trip, while his then wife was friendly with Ghislaine Maxwell.😬 pic.twitter.com/Cc9AbV7ME6

— m o d e r n i t y (@ModernityNews) December 6, 2023

Kennedy also stated that at some point he hung out with Epstein and went “fossil hunting” in South Dakota.

“My wife had some kind of relationship with Ghislaine Maxwell and they offered us a ride to Palm Beach,” Kennedy continued, adding “I went then, and another occasion, I flew again with my family with, I think, four of my children.”

RFK Jr.’s ex-wife, Mary Richardson Kennedy, committed suicide in New York in 2012.

Kennedy urged that all of this “was before anybody knew about Jeffrey Epstein’s, you know nefarious issues. And I agree with you that all of this information should be released.”

“We should get real answers on what happened to Jeffrey Epstein and any of the high-level political people that he was involved with. All of that should be open to the public,” Kennedy asserted.

Flight manifests do not list RFK Jr. as ever visiting the infamous ‘Epstein island’, neither do they list Donald Trump as stopping there, who also flew on the jet in 1997.

As we’ve previously highlighted, flight logs show that Bill Clinton frequented the private jet with Epstein, flying a reported 26 times over the years.

Bill Gates was also by all accounts quite pally with with pedo.

*  *  *

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For those who are confused why the US has spent tens of billions to keep the Ukraine-Russia war going on and on (setting aside of course money-laundering by the Biden crime family) here is your answer: as  FreightWaves’ Greg Miller reports, the unstated mission of the US military-industrial complex in the lead up and following the Ukraine war, was to unseat and replace Russia as the largest source of European energy, both crude and nat gas, and in the process push US crude exports to record highs, driven by a surge in European exports.

Indeed, as diplomats convene at the United Nations’ COP 28 climate change summit, fossil fuel production and consumption are hitting new highs, and tanker owners are in prime position to profit from rising trade flows.

The Biden administration is a leading proponent of decarbonization, yet the U.S. is pumping out record volumes of hydrocarbons. America is on track to be the world’s largest producer and exporter of natural gas this year, as well as the leading exporter of refined products and liquefied petroleum gas.

There are also big wins — for energy producers and shipowners, not decarbonization advocates — on the crude oil front.

The U.S. produced 13.2 million barrels per day (b/d) of crude oil in September, according to data released Thursday by the Energy Information Administration. That is the country’s highest monthly production level ever.

And not only is America producing more crude, it is exporting a larger share of the crude it produces, further boosting volumes aboard tankers bound for Europe and Asia.

Seaborne crude exports up 19% vs. 2022

Exports of U.S. crude were banned between 1975 and 2015. For 40 years, U.S. production could only be sold overseas if it was refined first, then exported as petroleum products.

The end of the ban dramatically increased market opportunities for U.S. production, thereby stimulating higher output — creating more business for oil companies and tanker owners.

That upward momentum continues. Seaborne crude exports are tracked by commodity intelligence provider Kpler. In January-November, its data shows that U.S. seaborne crude exports averaged 4 million b/d, an all-time high and up 19% year on year.

Exports in November averaged 4.45 million b/d, the second-highest monthly average on record, just slightly below the peak of 4.46 million bpd in March.

Volumes rise sharply to both Europe and Asia

The Panama Canal is wreaking havoc on many cargo supply chains, but it has virtually no effect on U.S. crude exports.

U.S. crude exports to Asia are loaded on very large crude carriers (VLCCs; tankers that carry 2 million barrels) via ship-to-ship transfers in the U.S. Gulf. VLCCs are too large to transit either the Panama or Suez canals; they use the Cape of Good Hope.

U.S. exports to Europe are shipped aboard Aframaxes (750,000-barrel capacity), Suezmaxes (1 million-barrel capacity) and VLCCs.

Since the invasion of Ukraine, Europe has hiked its purchases of U.S. crude to help offset banned Russian supply. According to Kpler data, an average of 1.83 million b/d of U.S. crude flowed to Europe in January-November, up 26% from the 2022 full-year average.

Europe’s share of total U.S. crude exports has risen to 46% this year compared to 37% in 2021, the year prior to the invasion, while Asia’s share is 41%, down from 47% in 2021.

“In volumetric terms, the story has been all about Europe this year,” Reid I’Anson, senior commodity analyst at Kpler, told FreightWaves. “Europe continues to grow increasingly reliant on U.S. energy — not just LNG [liquefied natural gas] but across the board.”

Despite the pull of Europe, U.S. crude exports to Asia have also continued to escalate. According to Kpler data, exports to Asia are averaging a record-high 1.65 million b/d year to date, up 15% from last year and up 26% from 2021.

Rising volumes to Asia translate into profitable business for VLCC owners. Brokerage True North Chartering counted 40 spot VLCC cargoes loading in the U.S. Gulf in both October and November, matching the prior monthly high in April.

By Michael Every of Rabobank

Black Sea, Red Sea… spot the pattern?

Markets focused on the US JOLTS labour data yesterday… because it was weaker than expected. It’s a questionable series that few have ever taken seriously, but if it’s moving in the right direction for lower bond yields and (if not on the day, surely soon) higher asset prices, then let’s look! However, as the Financial Times ran beneath their main headline about job openings being the lowest in over two years: ‘the jobs market is still tight. And bitcoin is booming again.’ Indeed, as the FT’s Janan Ganesh op-eds that ‘Voters don’t want to hear the fiscal truth’, it’s markets who don’t want to hear the macroeconomic truth. The US economy is not going to need generous rate-cuts in the near future when the ISM services survey is 52.7 and new orders are 55.5; such cuts will only be via a deep downturn that smashes equities and credit.

Markets also don’t want to hear the geopolitical truth as ‘Houthi attacks on vessels in Red Sea sound alarm for global trade’. Indeed, missile and drone fire at shipping –and the US Navy(!)– if continued, will see trade divert away from the Suez Canal round the Cape of Good Hope. The market’s blasé attitude shows that trading floors have learnt nothing about the real world of supply chains over the past few years.

If 30% of global shipping has to go via Africa rather than Suez, delivery times are going to be extended by weeks, and ocean carrier pricing is going to rise substantially. In parallel, the Panama Canal is so clogged up that a shipping company paid $4 million to jump the line, when a year ago a slot cost $173,000. That means inflation is already rising upstream, though with winners and losers in terms of who can now export what most easily. Overall, it’s a supply shock. At the same time, Middle East energy supplies could also yet be hit. Markets clearly don’t see those risks now, with oil prices so low that Russia is stating it and OPEC+ could cut output more if needed – another round in the ‘Fed and US dollar vs. BRICS commodities’ looms, it seems. Watch this space.

In response, there is already talk of the US Navy task force chaperoning merchant ships through the Red Sea: the US cannot escort non-US flagged ships without a remit, just assist after an attack, which is hardly going to reassure insurance companies. Yet if the US Navy steps up to an expensive and open-ended patrol, it raises a problem flagged by me in 2021: why should the US protect Chinese shipping? Especially when the perception is of a China-Russia-Iran-North Korea axis emerging, within which Iran is backing the Red Sea attacks. Perhaps it’s only Western, or Israeli, shipping that is vulnerable: in which case global dividing lines are again clear – and that’s as a maritime expert suggests China might even use the crisis to try to offer cheap insurance for ocean carriers, increasing its role in this vital area of global commerce.

The usual way out of this mess is the US flexing its muscles to stop Houthi action – which also means stopping Iran arming the Houthis. However, there is an election in 11 months, and a regional war which the White House is determined not to see escalate: so it won’t act. Politico notes US officials are frustrated by the Biden administration’s response to the attacks in the Red Sea, and @Charles_Lister tweets: “Two DOD insider sources told me today that the #Biden White House has placed (in the words of one) “every possible handcuff” on the DOD’s ability to respond to #Iran proxy attacks. The scale & scope of these attacks are unprecedented — and we’re just taking the hits. Dangerous.”

It’s ok, Iran is illegally exporting record amounts of embargoed oil to China so nothing will happen. If it stopped, oil would hit $120 overnight https://t.co/905bjoFGfT
— zerohedge (@zerohedge) November 18, 2023

It is dangerous. If the US is not going to calm this situation by a show of strength, it will be taken as weakness, which will ensure a grinding escalation in attacks – and then possibly a tipping point hit. Global trade will have to deal with massive disruption once again: and as the maritime chokepoints of Panama, Hormuz, Bab-el-Mandeb, and Suez all come under threat, how long until the Cape of Good Hope (in BRICS), and Malacca (as tensions rise in the South China Sea) do too? At least the Danish and British are behaving themselves in Oresund, the English Channel, and Gibraltar.  

Meanwhile, as one can see online chatter among logistics experts discussing the pros and cons of the US reintroducing letters of marque, i.e., finders-keepers state-sanctioned piracy, one other way to square the West’s circle is being floated:

A US Senator wants illegal immigrants to be given the opportunity to join the military in return for citizenship. “Do you know what the recruiting numbers are at the Army, Navy, and the Air Force? They can’t reach their quotas each month. They can’t find enough people to join our military forces. And there are those who are undocumented who want the chance to serve and risk their lives for this country. Should we give them a chance? I think we should,” said Senator Durbin. How very late-stage Rome. Or Starship Troopers (“Service guarantees citizenship”). For those very reasons, among others, I strongly suspect that this kind of idea has real sea-legs – and not just in the US.

To bring this all back to the landlubbers who liked the JOLTS report, the last thing that Western economies need if a weaker US hegemon means logistics and goods prices rise again is lower rates that boost asset prices and consumer demand, especially when firms have shown they will pass on any upstream shocks.

But of course markets will focus on JOLTS, not real-world jolts. Or Aussie Q3 GDP undershooting at 0.2% q-o-q vs. 0.5% consensus –with 0.4ppts being contributed by inventories, so contraction without it– even as somehow GDP was still up 2.1% y-o-y vs. 1.9% expected.

Also worth noting is that Aussie GDP per capita fell 0.5% even as the local press is full of stories of how obscenely high property prices are (“Home buyers would need to earn up to $90,000 more than they did early last year to afford to buy a median-priced house as rising interest rates slash buyer budgets.”). Regardless, ‘let them eat The Block’ policy remains firmly in place, as does a net migration flow which comfortably exceeds net house building each year. Look up at Europe or the US to spot the potential political pattern building there: Black Sea, Red Sea, The Block, see?

After getting his ass handed to him in a historic ouster, former Rep. Kevin McCarthy (R-CA) – whose speakership was the shortest in more than 140 years – is quitting Congress.

In a Wednesday WSJ Op-Ed, McCarthy tooted his own horn over having “helped lead Republicans to a House majority—twice,” and having “passed legislation to secure the border, achieve energy independence, reduce crime, hold government accountable and establish a Parents’ Bill of Rights.” 

We kept our eyes on America’s long-term global challenges by restoring the Intelligence Committee to its original charter and establishing a bipartisan Select Committee on the Chinese Communist Party.

We reduced the deficit by more than $2 trillion, revamped work requirements for adults on the sidelines, cut red tape for critical domestic energy projects, and protected the full faith and credit of the U.S. We kept our government operating and our troops paid while wars broke out around the world. –WSJ

After congratulating himself, McCarthy then announced that he’s outta there…

“It is in this spirit that I have decided to depart the House at the end of this year to serve America in new ways,” adding (of course), I know my work is only getting started.“

McCarthy has vowed to “continue to recruit our country’s best and brightest to run for elected office,” and “helping entrepreneurs and risk-takers reach their full potential.”

So he’ll essentially be a lobbyist / life-business coach?

That’s it! Kevin McCarthy announcing he’s leaving Congress and headed back to Bakersfield. Most of the ex-Republican Speakers leave DC with their reputation ruined…some to jail, others into obscurity. Not a normal departure among them. The GOP majority dwindles even further. pic.twitter.com/S60P147PA6

— Russell Drew (@RussOnPolitics) December 6, 2023

In October, Politico reported that McCarthy would resign before the end of his term – which the former speaker denied. 

“No, I’m not resigning. I’m staying, so don’t worry,” McCarthy told reporters at the time. “We’re going to keep the majority, I’m going to help the people I got here and we’re going to expand it.”

McCarthy’s term was set to end in Jan. 2025.

Today in “more money than God” news, Exxon Mobil announced it was going to hike its share buybacks by 14% upon consummating its $60 billion acquisition of Pioneer Natural Resources Co.

Exxon plans to repurchase $20 billion of its shares next year, on a par with its main competitor, Chevron Corp., which also increased buybacks following its $53 billion acquisition of Hess Corp. in late October, Bloomberg reported on Wednesday.

Exxon said it intends to invest between $23 billion and $25 billion in capital projects in the upcoming year and that this investment aims to enhance its presence in North America’s most productive oilfields and explore new reserves in areas like Guyana. Additionally, Exxon is also boosting its investment in low-carbon initiatives, the report says. 

The company aims to reduce structural costs by $6 billion by 2027, adding to the $9 billion saved since 2019, the report says. It will also invest $20 billion in low-carbon initiatives, including lithium, carbon-capture, and hydrogen, by 2027. The acquisition of Pioneer significantly boosts Exxon’s Permian Basin output, as we have noted.

And the buybacks come at a time when ESG and “green” investing are seeing major pushback.

Recall, just 3 weeks ago we wrote about how CEO Darren Woods argued that attacking oil and gas would only slow the push to net zero. The head of the oil supermajor argued that turning big oil companies into “villains” would trap millions of people in the developing world in poverty, according to a Bloomberg report.

At the Asia Pacific Economic Cooperation CEO Summit in San Francisco in November, Woods said: “The solutions to climate change have been too focused on reducing supply. That’s a recipe, for human hardship and a poorer world.”

Instead he urged governments to “harness the industry’s capabilities for change”, Bloomberg reported. He suggested providing government funding for technologies that reduce emissions, such as carbon capture, until they become viable through market dynamics.

Meanwhile, in other “green investing” news, Jeff Ubben’s Inclusive Capital, which sought to make investments in sustainable companies, shut down. 

In a new Bloomberg report, Ubben spoke out about what he is calling the “echo chamber” of traditional climate summitry. After shuttering his sustainability fund, which he said was not “rewarded” by markets, Ubben has joined a chorus of voices speaking out about “green” energy advocates who, in the name of virtue, the climate and the environment, are creating more division than they solve. 

“It’s been this echo chamber of diplomats going to these conferences and putting out flowery language and goals, but it doesn’t have traction,” Ubben said, talking about climate conferences. 

And now we await the Biden administration and Liz Warren’s forthcoming freakout.

Authored by Nick Giambruno via InternationalMan.com,

Bitcoin confuses many people, including prominent investment professionals.

Recently, I debunked the top ten most pervasive misunderstandings.

Today, I’ll continue by debunking another five.

Misconception #11—Bitcoin Is Vulnerable to Nuclear War and Utility Outages

Even if the US and Russia engaged in an all-out nuclear war, destroying most of the Northern Hemisphere, Bitcoin wouldn’t miss a beat in the Southern Hemisphere.

To even have a chance to stop Bitcoin, every government in the world would have to successfully coordinate simultaneously to shut down the entire Internet everywhere and then keep it off.

Even in that improbable scenario, the Bitcoin network can be communicated over radio signals and mesh networks. At the same time, small portable solar panels can power the computers running the network if the regular grid is unavailable.

Further, a network of satellites is constantly beaming the Bitcoin network down to Earth.

In short, all aspects of Bitcoin are genuinely decentralized and robust.

Barring an inescapable, global return to the Stone Age, Bitcoin appears unstoppable.

Misconception #12—Bitcoin 2.0 or a “Better Bitcoin”

As a practical matter, anyone can try to make a “better Bitcoin” whenever they want.

All you have to do is take the open-source code—available to anyone—and make your desired changes.

But that doesn’t mean anyone will follow your lead or value your new cryptocurrency.

For example, I can easily make a new Bitcoin that adds some bells and whistles and tout it using the latest buzzword. Let’s call it Bitcoin 2.0.

But that doesn’t mean I can inherit the superior monetary properties of the original Bitcoin, which depends on its supply’s credibility, which depends on its extreme resistance to change, which I’ve just undermined by adding some bells and whistles and thus demonstrating that someone can change it.

That’s why the market is unlikely to assign any value to Bitcoin 2.0.

Here’s another way to think of it.

Imagine someone wanting to change the rules of chess so pawns could move backward. Let’s call it Chess 2.0.

Of course, anyone could do so anytime, but that doesn’t mean Chess 2.0 will gain traction.

Remember, anyone can make a cryptocurrency in minutes.

That’s the easy part.

Making one that nobody controls is the hard part.

Simply put, no other cryptocurrency comes even close to challenging Bitcoin’s immutability, decentralization, resistance to debasement, liquidity, economic incentives, network effects, and, most importantly, the credibility of its supply.

But suppose a new cryptocurrency came along that was a genuine competitor to Bitcoin.

To disrupt Bitcoin’s established dominance as a monetary network, it would have to be not just a little bit better, but orders of magnitude better.

According to renowned author Jeff Booth, a new competitor to an established network must be at least 10x better to convince enough people to leave the existing one and join the new network.

There have been dubious claims of a “better Bitcoin” for many years, usually from people who simply don’t understand Bitcoin or disreputable altcoin promoters.

I am not inclined to believe such claims until there is solid evidence that something could potentially have much better monetary properties than Bitcoin.

So far, nothing has come close.

Misconception #13—The SEC Will Go After Bitcoin

Given their statements, it’s clear that the Securities and Exchange Commission (SEC) views almost all cryptocurrencies as unregistered securities, making them vulnerable to enforcement actions.

That has led many to incorrectly believe that the SEC will go after Bitcoin.

The reality is that Bitcoin is the only cryptocurrency unambiguously NOT a security.

The US government has been clear that it views Bitcoin—and only Bitcoin—as a commodity under the purview of the Commodity Futures Trading Commission (CFTC) and the Commodity Exchange Act.

Bitcoin is a commodity because it is an asset without an issuer.

Similarly, gold, silver, copper, wheat, corn, and other commodities have producers, but they do not have issuers.

Every other cryptocurrency other than Bitcoin has an issuer. They also have identifiable founders, central foundations, marketing teams, and insiders who can exercise undue control.

On the other hand, Bitcoin has none of these things—just as copper or nickel has no marketing department or founder.

The SEC couldn’t go after Bitcoin even if it wanted to because there’s nobody to go after. There’s no Bitcoin headquarters. Bitcoin has no CEO, no marketing department, and no employees.

But presuming the SEC could go after Bitcoin, they won’t because even they admit Bitcoin is not a security and thus not under their purview.

Misconception #14—Breaking Bitcoin’s Cryptography

Bitcoin’s cryptography is not a risk today.

If Bitcoin’s cryptography were at risk of being broken, it would also be an existential problem for every bank, brokerage, central bank, email provider, and every aspect of modern digital life.

I would put this risk in the same category as an alien invasion—something theoretically possible but irrelevant to investment decisions today.

But let’s suppose a hypothetical problem of quantum computing—or some new technology—posing a threat to Bitcoin’s cryptography.

A hypothetical solution exists.

It would be possible to upgrade Bitcoin’s cryptography by gaining the consensus of the full nodes to make it resistant to quantum computing or whatever new technology is an existential threat to it.

Misconception #15—Bitcoin Is Too Volatile To Be Money

It’s essential first to clarify that while the Bitcoin price is volatile, the Bitcoin protocol is the most stable, predictable, and reliable thing I know of in finance.

Ever since Bitcoin’s inception in 2009, the 21 million total supply has not changed, the network has never stopped, miners have continued to create a new block every 10 minutes on average, and anyone has always been able to use Bitcoin to send value to anyone, anywhere, without needing a third party.

In short, despite everything that has happened since 2009, the Bitcoin network hasn’t missed a beat.

That said, monetization doesn’t happen overnight, and it’s inherently a volatile process for the Bitcoin price.

While gold is an established money, Bitcoin is an emerging one.

It took gold centuries to achieve monetization. Bitcoin has a good chance of undergoing monetization in a much shorter period—and it’s already well on its way.

Something doesn’t go from having no value to being significant global money without volatility in its price. For example, Bitcoin went from having no value in 2009 to over $67,000 in 2021 to around $41,600 as of writing.

It is not uncommon for Bitcoin to have significant corrections of 50% or more, which has happened eight times. Further, there have been three occasions where Bitcoin has declined 80% or more.

Here is a chart showing Bitcoin’s biggest corrections over the years to put its volatility into perspective.

If you zoom out and look at the Big Picture, the volatility of the Bitcoin price has mainly been to the upside over the long term.

It’s a series of higher highs and higher lows.

Stomaching Bitcoin’s volatility is the price we must pay to earn outsized gains as it undergoes the process of monetization.

It will be a wild ride—like a violent roller coaster—but I believe it will reward patient investors.

There are a couple of ways to help tame the volatility of Bitcoin’s price.

First, instead of buying your desired amount of Bitcoin in one large transaction, use dollar cost averaging (DCA) to spread it out over time.

For example, suppose you’d like to invest $10,000 into Bitcoin. Instead of buying $10,000 at once, make a purchase of around $192 each week for a year.

DCA significantly reduces the risk of buying too much at the top of a cycle and not buying at the bottom.

That’s how DCA can turn Bitcoin’s volatility in your favor.

Second, plan on holding for at least four years—through one halving cycle.

There has rarely been a period in which the Bitcoin price was lower than it was four years ago. But, of course, past performance does not indicate future results.

Third, whenever you see volatility in the Bitcoin price, ask yourself two things:

1) Does Bitcoin still have superior monetary properties (total resistance to debasement and extreme portability)?

2) Is Bitcoin still unstoppable?

If the answer to those two questions is “Yes,” I would not be worried.

As adoption grows and Bitcoin becomes more established as money, the volatility should smooth out—but probably at a much higher price.

That’s why you want to buy Bitcoin—and the best Bitcoin stocks—before the rest of the world figures out its superior monetary properties.

I’ve just released an urgent PDF report revealing three crucial Bitcoin techniques to ensure you avoid the most common—sometimes fatal—mistakes.

Check it out as soon as possible because it could soon be too late to take action. Click here to get it now.

Authored by Tom Ozimek via The Epoch Times (emphasis ours),

A federal judge has denied special counsel Jack Smith’s request to keep some documents hidden in former President Donald Trump’s classified documents case.

Judge Aileen Cannon, who’s overseeing the trial in former President Donald Trump’s classified documents case, has rejected a motion by special counsel Jack Smith to keep some documents hidden from President Trump’s defense.

In an order signed on Dec. 4, Judge Cannon directed a court clerk to unseal multiple documents that Mr. Smith’s team sought to keep sealed in the case that accuses the former president of retaining sensitive government materials, including some that were marked top secret, at his Mar-a-Lago home.

President Trump has said he used presidential powers to declassify the materials, insisting that he isn’t guilty and calling the case an attempt by his political foes to hamper his 2024 presidential run.

The former president’s longtime aide Walt Nauta and Mar-a-Lago property manager Carlos De Oliveira have been named as co-defendants in the case; both also have pleaded not guilty.

President Trump’s defense team and Mr. Smith’s prosecutors have been litigating over what portion of classified materials the defendants are allowed to view, with the judge’s latest decision delivering a win of sorts for the co-defendants.

“In light of the Special Counsel’s Response to Defendants Motion to Unseal 230, and mindful of the strong presumption in favor of public access to judicial documents, the Clerk is directed to unseal docket entries 223, 224, and 230,” Judge Cannon’s Dec. 4 order reads.

More Details

The newly unsealed docket entry 230, a response by prosecutors to a Dec. 1 court order, shows that Mr. Smith’s team agreed to unseal the documents, as requested by the defense, although prosecutors insisted on some redactions.

“The defendants did not oppose the Government’s request, but reserved the right to challenge the redactions later,” the document reads.

Mr. Smith’s team also revealed in the newly unsealed court filing that prosecutors initially opposed unsealing 223 and 224 because it “would have revealed to defense counsel information, albeit unclassified, about the contours of the Government’s planned CIPA Section 4 motion,” meaning that it risked giving President Trump’s legal team an opportunity to more effectively counter Mr. Smith’s moves.

President Trump has been charged with retaining national defense information, meaning that his case will be tried under the complex rules laid out in the Classified Information Procedures Act (CIPA), which governs how those documents can be used in court.

A CIPA Section 4 motion asks the judge to redact certain information from the classified documents that are turned over to the defense.

The seven-stage CIPA process is sequential, meaning that one stage has to be completed before going on to the next. A key issue is that a delay at one stage of the CIPA process can affect the entire trial schedule.

President Trump’s attorneys wanted the trial to take place after the 2024 election, while Mr. Smith’s team has pushed for a faster timetable.

Mr. Smith said in the 230 filing that the reason he no longer opposes keeping the documents hidden from the public is that the court earlier ordered full, unredacted versions of the 223 and 224 docket entries to be provided to President Trump’s lawyers.

“Because the Court rejected that position and ordered the Government to provide unredacted versions of the two docket entries to defense counsel, there is no justification for keeping them from the public,” the special counsel wrote.

In a recent ruling in the classified documents case, Judge Cannon granted in part and denied in part the defense’s request to postpone deadlines, including the trial.

Possible Change to Trial Date

While Judge Cannon denied the defense’s motion to change the trial date, she said a delay would “be considered at a scheduling conference on March 1, 2024,” which is just three days before President Trump’s trial is set to start in another case that Mr. Smith is prosecuting in Washington.

Citing the “high volume” of classified discovery, the judge wrote that it’s “most prudent, given the evolving complexities in this matter, to adjust the first batch of pre-trial deadlines.” She said that she couldn’t “ignore the realities” of President Trump’s several other trial schedules.

The order sets new deadlines for discovery, including a joint discovery status report on Jan. 9, 2024, and a pretrial motions deadline for Feb. 22, 2024, the last deadline before the rest of the trial schedule will be decided after a March 1, 2024, hearing.

In Washington, Mr. Smith is prosecuting President Trump in a case that accuses him of illegally interfering with the 2020 elections, and the trial is set for March 4, 2024.

Defense attorneys have said numerous times that they need time to go through 1.3 million pages of unclassified discovery, 5,500 pages of classified discovery, and 60 terabytes of security video footage.

Defense attorneys have said they will seek to compel additional material from the special counsel’s office and from the FBI.

The special counsel’s office, meanwhile, is seeking to prevent some of the already-produced classified discovery from the defendants.

Catherine Yang contributed to this report.

The Biden administration has offered a major prisoner swap for the release of detained Wall Street Journal reporter Evan Gershkovich and ex-Marine Paul Whelan, the latter who has been locked up for years at this point.

As for Gershkovich, he’s reached 250 days of pre-trial confinement, after his arrest on spy charges last March. “In recent weeks, we made a new and significant proposal to secure Paul and Evan’s release,” State Department spokesman Matthew Miller said in a briefing Tuesday. “That proposal was rejected by Russia.”

Dow Jones and the Wall Street Journal acknowledged of efforts to free Gershkovich, “The passage of time dictates that we work harder than ever to sustain our efforts until Evan is free.” It’s as yet unknown precisely what prisoner or prisoners may have been offered to Moscow, or whether the offer took another form, such as some level of sanctions relief (which remains unlikely).

Further, an unnamed US official was cited in the WSJ as confirming the State Department is “constantly discussing this issue with third countries who can assist.”

Apparently this has included the US administration getting creative in terms of seeking ideas for a swap significant enough that Moscow would find it attractive: 

Moscow has said it is acting in accordance with its own laws.

Earlier this year, U.S. Secretary of State Antony Blinken said the U.S. had made a significant proposal for Whelan, a 53-year-old former U.S. Marine who wasn’t included on two previous occasions when the U.S. was able to bring home the Americans Trevor Reed and Brittney Griner in prisoner exchanges that resulted in the release of Russians Konstantin Yaroshenko and Viktor Bout.

Since those deals were conducted, Russia hasn’t shown any signs of interest in the release of other Russian citizens in U.S. custody, prompting U.S. officials to eye Russian citizens held elsewhere in the world as possible elements in any exchange.

The White House has previously denounced the spy charges against Gershkovich as “ridiculous” and “totally illegal” – and moved quickly to designate him as unlawfully detained. This paved the way legally for hostage negotiations.

Gershkovich had reportedly been looking into a story related to a major state-backed defense technology firm, and his case marks the first American journalist to be held on spy charges since the Cold War.

As for Whelan, he’s been locked up in Russia for much longer, having been convicted of espionage back in 2020, for which he’s now serving a 16-year sentence. School teacher Marc Fogel, arrested for drug-related charges in circumstances very similar to WNBA star Brittney Griner’s case, has also not seen progress on his release. Their families expressed regret and outrage that US media had been so focused on Griner’s case, which ultimately led to her release.

Authored by Michael Lebowitz via RealInvestmentAdvice.com,

After hiking rates by 5.25% since March 2022, the Fed is in a wait-and-see period, commonly deemed a pause. Since the Fed started hiking rates, inflation has declined meaningfully but remains moderately above the Fed’s 2% target. The economy continues to thrive, fueled by a strong labor market.

Despite the good news, a dark cloud lingers on the horizon. The Fed’s primary fear is that the lag effect of prior rate hikes has yet to impact the economy fully. They desire a soft landing, implying little economic degradation. But a much stronger downturn can’t be ruled out in their minds or ours. Given the odd juxtaposition between strong economic growth and recession fears, a Fed pause is the most likely action.

The Fed Funds futures market agrees with our assessment. As we show below, it expects the Fed to pause through February. Starting in March 2024, the market implies increasing odds of the Fed cutting rates.

If the Fed is in the pausing stage of the cycle, the logical question is how long it might last. More importantly, how might stocks and bonds perform during the pause and eventually when the Fed cuts rates?

The equity market appears to be giddy at the prospect of rate cuts, but as we will discuss, equity investors should start contemplating risk reduction strategies. Bond investors are the ones that should be giddy!

Stock Investor Giddiness Explained

The November 3, 2023, BLS employment report underwhelmed expectations. However, the bad news was good news. The stock market roared as investors presumed a Fed pause was a done deal. Since then, it has continued rising nearly 6% in only a few weeks. Bonds followed. Over the same period, the U.S. Treasury ten-year note yield has fallen by .50%.

The weaker-than-expected CPI inflation report fueled the notion that the Fed was done.

WSJ reporter Nick Timiraos, the Fed’s media mouthpiece, leads credence to the Fed pause narrative. Shortly following the CPI report, Nick tweeted the following:

“The October payroll report and inflation report strongly suggest the Fed’s last rate rise was in July. The big debate at the next Fed meeting is shaping up to be over whether and how to modify the post-meeting statement to reflect the obvious: the central bank is on hold.“

Stock and bond investors are giddy at the prospect of slower growth and lower inflation. Such outcomes are not good for equity investments. Yet logic is trumped by the hope that the Fed’s next move may be to lower interest rates.

If this rate cycle is like almost all others in the last 100 years, a Fed pause will be followed by rate cuts.

How long of a pause should we expect before rate cuts?

How Long Will A Pause Last?

Nineteen weeks ago, on July 26, 2023, the Fed last hiked rates. The graph below, courtesy of ZeroHedge and Bloomberg reporter Simon White, shows five instances since 1970 when the Fed paused rate hikes for at least 18 weeks and resumed hiking. Only two of the cases were in the last 40 years.

In the accompanying article, Simon writes:

But when rates are already restrictive as they are today, it would be unprecedented. The longest the Fed has held rates after last hiking them, and then raising them again when rates are already restrictive – i.e., when the real Fed rate is greater than the neutral rate (using the Holston-Laubach-Williams estimate) – is 14 weeks, between August and November 1988.

No one can be 100% confident inflation will continue lower. As such, the Fed’s probability of raising rates again is not zero. However, the Fed seems more concerned that the lag effect of the prior 5.25% in rate hikes has yet to fully exert its weight on the economy. It is this dark cloud on the horizon that pressures them to pause.

The last three pause cycles since 2000 lasted 36 weeks on average. Thirty-six weeks from what may be the start of the recent pause puts us in March 2024. As we wrote in the opening, March 2024 is also the month when the Fed Funds futures market starts pricing in rate cuts.

Stocks And Bonds In Pause and Rate Cut Phases

How do stocks and bonds perform during the stages of monetary policy?

The graph below shows Fed Funds (black), the S&P 500 (orange), and 10-year U.S. Treasury bond yields from 1998 to the present. We highlight the rate hike, pause, and rate-cutting cycles with red, yellow, and green, respectively. For this article, we only consider the pause to be after the Fed increases rates.

Below, we isolate the three prior and the current partial cycles to appreciate what happens during the three cycles.

Marrying Historic Returns And Logic

Stocks often do well when the Fed is hiking rates and bond yields typically rise. This occurs because the economy is running above trend, and the Fed will raise rates for fear of inflation. Their aim during such periods is to slow growth back to trend.

The economy is fueled by debt. Accordingly, higher interest rates almost always result in below-trend growth and a recession.

The term “soft landing” is often used during rate hike cycles despite their frequent occurrences. The graph below shows that a rising Fed Funds rate preceded every recession since 1950. The circles show the only instances when Fed hikes did not result in an immediate recession.

Stock performance is mixed during the Fed’s pausing cycle after rate hikes. As shown above, stocks rose decently before the financial crisis and pandemic but fell before the dot-com bust. Bond yields fall during the pause as investors anticipate slower growth and less inflation. In all three prior periods, yields fell. Currently, yields have risen during the pause but are now trending lower.

Lastly, stocks tend to perform poorly during the rate cuts, and bond yields continue to fall. Such is unsurprising as the Fed typically raised rates too much, and a soft landing turned into a hard landing.

At the bottom of the graphic are the average returns for stocks and bonds for the four periods. As shown, stocks are the investment of choice during rate increases while bond yields rise. The pause period is tricky for stockholders. Bondholders should be comforted during both the pause and the rate-cutting period. Stock investors should consider risk reduction strategies as a rate cut will likely be the next Fed move. 

Summary

If history proves prescient and the Fed is genuinely pausing before a series of rate cuts, investors should consider how they might shift their exposures between stocks and bonds.

Within the equity markets, lower beta, more value-oriented stocks, and reduced equities allocations have tempered losses in past rate-cutting environments. On the other hand, bond yields may have already peaked around 5%. The current rate decline may be the tip of the iceberg if a recession is coming.

The risk to our forecast is that history doesn’t always repeat. Secondly, we have zero assurances the Fed has ended its rate hiking cycle. If the Fed raises rates again, the pause clock starts over, and stocks may do better than bonds.

Lastly, the Fed and government may panic as they did in 2020 and provide a bazooka to the equity markets via massive QE and zero interest rates. If so, any decline in equities may be short-lived. Conversely, longer-term bond yields could rise as investors now appreciate how such a massive fiscal and monetary reaction to weakness can generate inflation.