Authored by Frank Miele via The Epoch Times (emphasis ours),

The inventors of artificial intelligence went before Congress last week and warned that without government supervision, the emerging technology could be employed by the unscrupulous to mislead people and spread falsehoods.

It’s frightening, but not without precedent.

If you want to know what it would look like if an AI were programmed to be relentless, ruthless, and amoral in service to a political agenda, you don’t have to look far.

Just consider the mainstream media. They have tailored their so-called news coverage to focus entirely on attacking conservatives and covering up for Democrats. Anyone who challenges their narrative is accused of lying or peddling “conspiracy theories.” Any facts that disprove their assumptions are either ignored entirely or summarily dismissed as Republican “talking points.”

And then remember this: Thanks to the First Amendment, the dangerous lies of the media cannot be subject to government supervision or control. It’s entirely up to us to sniff out and reject the falsehoods, but if you are a trusting soul who can’t imagine a world where you are intentionally kept in the dark about fundamental truths, then you will always be living an illusion.

A perfect metaphor for this state of blissful ignorance was unveiled recently on the Apple TV+ show “Silo,” which tells the story of a few thousand people who have been living underground in a massive silo for generations. Their only contact with the outside world is a video link to a camera placed on the surface, which shows a forlorn landscape littered with the bodies of those few daring people who had exited the silo after growing sick of being virtual prisoners. The video of the bleak and deadly surface plays nonstop in public places to remind the residents of the silo that there is nothing for them on the outside.

In our metaphoric analysis, that video represents the relentlessly negative and destructive narrative of the mainstream media, played over and over for an unwitting population. There is little reason for the average person to doubt what he or she has been told so convincingly by so many seemingly sincere talking heads. But what happens if the public gets a glimpse of reality?

Just such an occurrence happened in a recent episode of “Silo” when the main generator for the silo was turned off in order to accomplish needed repairs. In the brief moment between the power going down and the backup generator kicking in, the Hiroshima-like deathscape on the video screen was replaced by a halcyon sunlit pasture of green grass and trees. Blink and you missed it. And if you are one of the characters who lives in the silo, you keep your mouth shut. No one so far has admitted what they saw or asked questions about it. That’s what happens when you are fed an endless diet of lies. The truth looks like an unappetizing worm.

But sooner or later, as the Bard tells us, the truth will out, or in this case the worm will turn.

That transformation for the mainstream media began on May 10, when Donald Trump climbed out of the silo and showed millions of CNN viewers that the lies they’ve been told for years were absurd and dangerous, starting with the notion that the 45th president himself is absurd and dangerous. Town hall moderator Kaitlan Collins did her best to lock down Trump with questions intended to humiliate or mock him. But what she did not count on was that having an audience full of real people from the free state of New Hampshire would make her questions look as fake as that dead planet on “Silo.”

From the moment the crowd of 300 or so Republican and independent voters gave Trump a standing ovation as he was introduced, it was obvious that Collins was in for a long night. So was the television audience of 3.3 million presumably mostly liberal CNN viewers who have been fed a steady drumbeat of anti-Trump propaganda for more than six years. Collins did her best to unsettle Trump by bringing up topics such as the legitimacy of the 2020 election, the Jan. 6 riots, and the many legal cases brought against him by Democratic district attorneys or funded by Democratic donors. But in every single instance, Trump was prepared to answer by rejecting and refuting the left-leaning assumptions implicit in the questions. And the audience kept applauding. They even cheered when Trump called Collins a “nasty person” because she didn’t listen to his answers, or dismissed them because they didn’t agree with her own preconceptions.

It was no doubt maddening to the usual suspects at CNN, as was made obvious by the fact that they cut short the scheduled 90-minute town hall by nearly 20 minutes and then proceeded to devote nearly two hours to re-establishing the official CNN narrative: Trump is absurd and dangerous, and can’t be trusted no matter how much those crazy people from New Hampshire seemed to like and respect him!

Jake Tapper started the commentary by saying “Mr. Trump’s first lie was told just seconds into the night with his false familiar claim that the 2020 election was ‘a rigged election,’ and the falsehoods kept coming fast and furious about the Jan. 6 insurrection, about the threats to Vice President Pence, about Pence’s ability to overturn the election, about Covid, about the economy and more.”

In other words, the picture you just saw where Trump was witty, charming, in full command of the facts and unwilling to be pushed around by a junior reporter was not what you saw at all. To paraphrase Obi-Wan Kenobi, “Nothing to see here. Move along.”

Suddenly, we were back safe and sound in the universe where Trump is a troublesome oaf, and where all the so-called smart people agree that the walls are once again closing in on the mega-villain known as the MAGA Prince. It didn’t require evidence to say so, just a concert of voices in agreement that nothing we had seen with our own eyes was real. I call it the Deep Fake of mainstream media – mouths moving but the words coming out of them are untethered from reality. Just an anti-Trump, anti-MAGA, anti-conservative agenda that can be twisted around any and every news story.

Perhaps the best (or worst) example of this can be found on MSNBC’s “Morning Joe,” which provides the most-one sided panel of talking heads this side of Rachel Maddow. The episode on the morning after Trump’s invasion of CNN was more proof that the former president had terrified the mainstream media mob. Which means they could only do one thing in response – lie.

In that regard it was similar to almost any day on “Morning Joe,” but host Joe Scarborough reserved his greatest vitriol for this episode. Right out of the gate, he and his producers tried to imply that Trump was delusional about Jan. 6 by matching his words about the massive rally he held that day with pictures of the riot a few hours later at the U.S. Capitol. So when Trump said that his supporters were at the rally “with love in their heart,” Scarborough and his team conflated that with pictures of rioters at the Capitol, even though they had nothing to do with each other. It was a bit of propaganda worthy of Leni Riefenstahl, the Nazi filmmaker. Four hours of that kind of distortion was too much to watch, but I made it through 90 minutes and came to the conclusion that Scarborough and his guests were tools of a self-serving narrative to the same degree as a ChatGPT deep fake, and both were equally soulless.

Coincidentally, CNN superstar Anderson Cooper unwittingly took up the silo metaphor himself the day after the town hall when he responded to outraged CNN viewers who could not believe that their beloved left-wing network had veered from their usual Deep Fake script and allowed Trump an opportunity to demonstrate that his brand of conservatism has a strong following that cannot be easily dismissed.

“You have every right to be outraged today and angry and never watch this network again,” Cooper said on his show. “But do you think staying in your silo and only listening to people you agree with is going to make that person go away?”

Based on the heated reaction to Cooper’s remarks, yes, most CNN viewers want to stick their heads in the sand and pretend that front-running candidate Trump doesn’t exist. So much easier to listen to the fake narrative that paints the former president as the most hated man on the planet than to consider, as Cooper reminded his viewers, that “the man you were so disturbed to see and hear from last night, that man is the front-runner for the Republican nomination for president. And that audience that upset you, that’s a sampling of about half the country. They are your family members, your neighbors, and they are voting. And many said they’re voting for him.”

Of course, it’s not just television media that promotes a fake narrative about Trump and his supporters. Consider this tweet by the New York Times on Tuesday after the release of the Durham Report, which confirmed that the FBI had no legitimate evidence against Donald Trump when it launched its Russia collusion probe:

“John Durham’s report on the FBI’s investigation into the Trump campaign’s work with Russia, which produced no startling revelations, is being viewed by some conservatives as lending credence to their conspiracy theories about the U.S. agency.”

Say what? “No startling revelations” implies that the New York Times already knew that there was no legitimacy to the allegations against Trump. But if that’s the case, then why hasn’t the Times returned the Pulitzer Prize for National Reporting it shared with the Washington Post in 2018? Both of those esteemed newspapers promoted the Democrat-originated lie that Trump was a Russian asset and they did absolutely nothing to uncover the truth about how the FBI was co-opted by the Biden administration as a campaign asset for Hillary Clinton.

And even more outrageously, the New York Times (the nation’s putative paper of record) twisted the damning facts of the Durham Report into a Republican fever dream that could apparently be dismissed as one more “conspiracy theory.” Hey, Mainstream Media! It’s not a conspiracy theory any more if it’s proven to be true – then, it’s a conspiracy fact. Durham concluded that the FBI persecuted the 45th president of the United States without any credible evidence, and no amount of willful denial will change that devastating charge.

Not sure if reality will win out against the phony mainstream narrative in the long run, but my hope rests with 300 New Hampshire voters who thumbed their collective nose at CNN on national TV and said in no uncertain terms that they don’t want to live in the Fake News silo any more. What educated person does?

Hedge funds may be finally piling into stocks just as the S&P breaks out above the 4,200 resistance level (because Wall Street “pros” always sell low and buy high), but unable to shake the conviction that the economy is headed for the crapper, they are ramping up their shorts in other assets to brace for what is coming, and nowhere more so than in oil where bearish hedge fund bets just hit the highest in 12 years.

As Bloomberg shows, the trading positions of hedge funds and other non-commercial traders are at the most bearish levels since at least 2011 across a combination of all major oil contracts…

… and in bets that are perhaps most indicative of recession expectations, speculators’ combined views on diesel and gasoil – fuels that power the economy – are near the most bearish levels since early in the Covid-19 pandemic.

That said, positioning in gasoil and US diesel ticked slightly higher in the latest week, while commercial traders who work for the producers as well as other merchants of crude, aren’t so bearish, with some even reducing hedges against a potential price drop.

Still, “it’s pretty remarkable to see this type of positioning,” Greg Sharenow, who manages a portfolio focused on energy and commodities at PIMCO, told Bloomberg in an interview.

The gloom over the oil market this year – a sharp contrast to last year’s Ukraine war-driven meltup – has come from multiple directions, including expectations that the Fed’s rate hikes will provoke a contraction (oddly enough, this has not impacted stocks or bonds) and China’s disappointing rebound from its Covid-19 restrictions. Add in the threat of a US default if politicians fail to raise the debt ceiling and the possibility that OPEC+ may not deliver all the output cuts they’ve pledged, and traders have no shortage of bear scenarios to choose from.

While investors are positioned for a significant business cycle downturn hitting petroleum consumption and prices in the remainder of 2023, prices for fuels such as gasoline and diesel are expected to hold up better than crude because fuel stocks are well below long-term seasonal averages and refineries are already processing more crude than usual according to Reuters analyst John Kemp.

The extreme extent of the financial traders’ bearishness raises the risk of volatility if the OPEC and its allies decide to cut production further. That scenario will surely set off another brutal squeeze that forces bears to rush to exits, sends the price of oil soaring and worsens inflation.

Meanwhile, Goldman projects any large gains in oil prices could unleash as much as $40 billion worth of buying in US crude and Brent alone from trend-following commodity trading advisers; however for now the only direction CTAs are pushing oil is lower.

What is odd is that while hedge funds are positioned for a significant business cycle downturn hitting petroleum consumption and prices in the remainder of 2023 and have picked oil and only oil to express their bearish bets having been burned one too many times on their stock shorts, the underlying physical markets aren’t reflecting the dire state that traders are preparing for. On the contrary: refineries are processing the most crude for this time of year since the pandemic began, China crude demand is record high, air travel is rising just about everywhere, and gasoline demand in the US is now at the highest level since December 2021. At the same time, fuel inventories are below seasonal norms for gasoline and diesel in the US, and OPEC+ cuts and Canadian wildfires have limited crude supply.

The International Energy Agency recently hiked its expectations for global oil demand growth this year on China’s post-pandemic rebound, which, despite a strong gain in consumer usage, has failed to live up to optimistic forecasts. That’s because industrial demand has been the central focus for traders, and weakness in manufacturing and trucking has kept them from going long on diesel.

“Traders are focused on China recovery, specifically if the increase in consumer-led consumption can meaningfully outstrip weakness in industrial demand,” said Rebecca Babin, a senior energy trader at CIBC Private Wealth.

While a reversal of the bearish sentiment doesn’t appear imminent, a continued decline in inventories may help oil beat other asset classes.

“If you do genuinely believe that we’re in a capital-disciplined and under-investing environment, then when the economy does stabilize, commodities, and oil within that, are likely to outperform over an extended period of time,” Pimco’s Sharenow said.

In a note from Wells Fargo equity reearch, the bank writes that while its model implies a Q2 2023 build, the bank has not seen that in the US or other weekly data. In fact, its tracking of US/ARA and floating inventories (crude + products) indicates a modest draw since 3/31, with The most recent reports from China indicate draws from their oil storage to support local refining demand. And while visibility into China’s refined product stocks is murky, stronger crack spread trends imply no unusual refined product builds have occurred.

As such, the bank’s base case assumption remains a modest recession by YE’23. If the economy avoids that outcome, “then an undersupplied oil market becomes a more likely event… This implies risk/reward for oil prices (and by extension, energy equities) is tilting more favorably as the calendar reaches mid-year.”

Goldman agrees and writes that “inventory draws appear to have started” among global visible stocks, signaling a turning point for the market; the bank adds that oil price weakness has been driven by stronger-than-expected supply from Russia and record releases from US strategic reserves. And of course relentless shorting by hedge funds who are poised for another bruising short squeeze in the weeks ahead.

Finally, while hedge funds are betting that OPEC is quietly overproducing and exporting much more than their recent quota permits, a recent update by Goldman Sachs shows that bears may be in for a very reude awakening, as seaborne net exports by OPEC countries which announced a cut in April have finally tumbled by over 1mmb/d over the past 2 weeks.

By Laura Dyrda of Becker Hospital Review

There are 646 rural hospitals at risk of closure due to financial issues, comprising around 30 percent of all rural hospitals in the U.S., according to the Center for Healthcare Quality & Payment Reform.

The hospitals face losses on patient services as health plans aren’t paying enough to cover the cost of care delivery. The losses will likely increase as inflation and workforce shortages persist, according to the report, which was released in April. While rural hospitals are receiving some support through grants, local tax revenues or other profits, they still have low financial reserves and remain at risk.

More than half the states in the U.S. report 25 percent or more of their rural hospitals are at risk of closure, and more than 200 hospitals nationwide are at immediate risk of closing.

Here are the number and percentage of rural hospitals at risk of closing by state from the analysis:

Former Deputy National Security Adviser K.T. McFarland, who served for the first four months of the Trump administration under Michael Flynn, says that the deep state is going to rig the 2024 US election following their success in 2020.

“We now have black-and-white evidence that the FBI interfered in the 2016 election. When they failed to elect Hillary Clinton, they set out to destroy the Trump administration,” she told Fox Business‘ Maria Bartiromo.

“Go back to 2020. This time, the CIA got involved in the election with those 51 former intel agents who said the Hunter Biden laptop was Russian disinformation. So they’ve gotten away with it for two elections. They will surely try and get away with it in 2024, right?

Because there are no consequences…

“There is now hard evidence that there was election interference by the U.S. intelligence agencies and the Department of Justice. Those individuals must be terrified that a Republican president comes in with a Republican Attorney General, investigates them, and charges them with all of the crimes they have committed over the last eight years. Take it to the bank.

They will absolutely interfere in 2024…

These people are selling us out. Not only to foreign leaders, but they are interfering in our elections.

They are tearing up the Constitution… This is just a gut punch to the American people.“

Watch:

h/t @KanekoaTheGreat

Authored by Steve Watson via Summit News,

Republican lawmakers in the House and Senate have demanded answers from the National Institutes of Health over a two year study involving prescribing gender changing hormones to hundreds of children, as it emerged that two of the ‘youths’ ended up killing themselves.

As Fox News reports, the study titled “Psychosocial Functioning in Transgender Youth after 2 Years of Hormones,” examined 315 individuals  “between the ages of 12 and 20 who identify as transgender and were given cross-sex hormones.”

The study, involving 240 children, was funded by NIH which admits that “two young people tragically died by suicide.” 

Despite the deaths, the NIH carried on the study to its conclusion.

Over a dozen lawmakers, including Lauren Boebert, Marco Rubio and Rand Paul have penned a letter to the NIH director Dr. Lawrence Tabak.

It’s almost like it was more important to get a certain result than to find the best result.

— Mark Mazurik (@MarkMazurik) May 22, 2023

The letter notes that “During this study, two young people died by suicide and eleven reported suicidal ideation,” adding that “Rather than shutting the study down after such serious adverse events, the researchers published their paper, concluding that the study was a success because cross-sex hormones had altered subjects’ physical appearance and improved psychosocial functioning.” 

Researchers assert that “During the study period, appearance congruence, positive affect, and life satisfaction increased, and depression and anxiety symptoms decreased.”

They also claim that despite 11 kids expressing a desire to kill themselves and two actually committing suicide, “Increases in appearance congruence were associated with concurrent increases in positive affect and life satisfaction and decreases in depression and anxiety symptoms.”

North Carolina Senator Ted Budd, another co-signer of the GOP letter described the study as “absolutely tragic,” charging that those involved are “in search of an agenda and justifying an agenda, they’re not really about children’s safety as we’ve seen from the suicides.”

The Republicans further note in their letter that “the four clinics and some of the researchers who conducted this experiment are outspoken advocates for conducting gender transition interventions on children.”

“Were the individuals who tragically died by suicide while participating in this study minors?” the lawmakers ask, adding “Were participants and their parents given the opportunity to reconsider their consent and withdraw from this research in light of the suicides?”

Watch:

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Authored by Peter Chawaga via BitcoinMagazine.com,

Zoltan Pozsar, who until recently worked as the managing director of investment bank Credit Suisse, offered his insight into financial markets and the issues that are weakening the dollar’s dominance around the world.

In his role at Credit Suisse, Pozsar’s insight into the ins and outs of the legacy financial system and market dynamics was highly sought after. His recent departure from the bank came shortly after it was purchased by UBS in March as an attempt to keep it from collapsing amid existential turmoil for banks around the world. On stage at Bitcoin 2023, Pozsar addressed how U.S. banks have been impacted.

“This is basically an episode where the large banks are largely insulated from the problems,” Pozsar said.

“It’s basically lessons in not being able to run interest rate risk, not knowing how to make a loan that will be weathering a rising interest rate storm.”

He described the Federal Reserve’s responses to these banking failures as only addressing “half the problem.”

“I think it’s more like foaming the runway for any of the large banks that might be having problems down the road,” he added.

Pozsar was interviewed on stage by BitMEX co-founder Arthur Hayes, who pressed him on whether he owns any bitcoin.

“I don’t own any,” Pozsar responded. “I’m observing it. I don’t like to dabble in things that I don’t understand well.”

Pozsar outlined his pessimism that bitcoin could ever really serve as money, as his historical research has shown him that money has to have a direct link to a government to endure. As a fundamentally decentralized, peer-to-peer network, Bitcoin could not support money that fits his definition.

“The one thing I will say about bitcoin is that money, if you will, is something that is purely public or a public-private partnership,” Pozsar explained.

“When I look at Bitcoin, it’s a purely-private initiative. It’s clearly lacking a state link. But then again, things are evolving, there are a number of countries that have adopted bitcoin as a legal tender, so things are definitely in flux there.”

In his writing, Pozsar has underscored the evolving role that Bitcoin is playing around the world as institution-backed money like the U.S. dollar becomes weaker. At Bitcoin 2023, he listed several global market trends, including the rising economic power of China, that are threatening its role as the global reserve currency.

“There’s a number of changes happening that I think we need to keep an eye on because it’s all going to be at the expense of the dollar’s share of commodity finance, trade finance, share of reserve assets and so on,” Pozsar said.

Watch the full interview below:

Hours after China banned Micron Technology’s semiconductor products from critical infrastructure projects over a ‘major national-security risk,’ Seoul has stepped up and said South Korean companies Samsung and SK Hynix would fill the void as tensions between the US and China continue to escalate, reported Financial Times. 

Even though the White House has urged South Korea to stop its chipmakers from supplying China if Beijing banned Micron from selling chips, policymakers in Seoul said Monday they would allow companies to make their own decision, independent of Washington’s request:

“Regarding what the US tells us to do or not to do, it is actually up to our companies. Both Samsung and SK Hynix, with global operations, will make a judgment on this,” South Korea’s vice-minister of trade Jang Young-jin told reporters.

We detailed Beijing’s ban on Micron Sunday night, as it’s a retaliation strike over a sweeping US ban on Western companies from selling advanced chip-making technology to China. In other words, it’s a tit-for-tat tech war.

However, Financial Times pointed out Washington might have leverage over Samsung and SK Hynix, which both are trying to expand business operations in the US and need “one-year waivers from the country to be extended so they can ship new equipment into their chip fabrication facilities in China …. these waivers must be renewed later this year, giving Washington potential leverage to use against the companies.”

An industry exec told FT:

“There are not many Chinese companies that get chips only from Micron. Even if we increase our supply to Chinese customers, how can they examine all these deals individually and judge that the increased volume comes from us, replacing Micron’s?”

FT noted:

“While South Korea is not a member of the G7, the group said it would work on creating a mechanism with a broad set of partners to deter and respond to Beijing’s use of economic sanctions to further its geopolitical goals.”

“Memory is a commodity, and supply chains will adjust in a couple [of] quarters,” said SemiAnalysis’ chief analyst Dylan Patel. He stated China could easily swap Micron’s memory chips for Samsung or SK Hynix ones. 

Patel believes long-term damage to Micron will be ‘manageable.’ 

Meanwhile, shares of Micron slid nearly 5% early in the US cash session. 

As previously mentioned, Gavekal Dragonomics estimates that 10% of Micron’s revenue is derived from China. The tech war between the US and China is ongoing, with no signs of de-escalation.

Authored by Mimi Nguyen Ly via The Epoch Times (emphasis ours),

Daniel Penny, the U.S. Marine veteran who is facing criminal charges after he put a homeless man, Jordan Neely, in a fatal chokehold in New York City at the start of the month, has decided to speak publicly about the incident.

In an interview with the New York Post, the 24-year-old Penny said the fatal altercation that took place on a subway train in NYC “had nothing to do with race.”

Neely, a 30-year-old black man, had a long history of mental illness and more than 40 prior arrests ranging from disorderly conduct to assault, and an active warrant out for his arrest from a felony assault.

“I judge a person based on their character,” Penny told the newspaper. “I’m not a white supremacist.

“Everybody who’s ever met me can tell you, I love all people, I love all cultures.”

When asked by the paper what he would say to the family of Neely, whose funeral was on May 19, Penny said, “I’m deeply saddened by the loss of life.

“It’s tragic what happened to him. Hopefully, we can change the system that’s so desperately failed us.”

Second-Degree Manslaughter Charge

Penny was arraigned in Manhattan Criminal Court on May 12, on a charge of second-degree manslaughter. The city medical examiner ruled the death of Neely a homicide due to “compression of neck (chokehold).”

Penny had pulled Neely to the floor and pinned him with a hold he learned during combat training, according to a video of the incident.

Juan Alberto Vázquez, a freelance journalist who recorded the clip, previously told the New York Post that Neely had been threatening and screaming at other passengers “in an aggressive manner,” while also complaining of hunger and thirst.

At one point, Neely started to scream that he was “fed up” and doesn’t care anymore whether he would go to jail for life.

Penny then approached Neely to restrain him. In the video, two other riders are also seen restraining Neely’s arms as Penny holds him in a headlock. After they let go of him, Neely is seen lying motionless on the floor.

According to the Post, Penny said he couldn’t elaborate about the details of the confrontation because of the pending court case, but said that it wasn’t like “anything [he’d] experienced before.”

Read more here…

The Turkish Lira briefly tumbled as much as 4.1% to breach past the 20 per US dollar mark for the first time ever amid thin liquidity early Monday. At that point the central bank intervened, and the currency quickly pared losses and was last trading at 19.8339 per dollar, which excluding the brief flash-crash, is the lowest level on record for the distressed currency.

The ongoing plunge in the Lira comes days ahead of the presidential runoff round on Sunday, after President Recep Tayyip Erdogan failed to secure more than 50% of the ballots in the first round of voting on May 14, although the final outcome appears to be assured after earlier today Turkey’s Sinan Ogan endorsed Erodgan in the runoff round, effectively guaranteeing him a victory. That said, one- week implied volatility on USD/TRY pair jumps to 30% versus 17.2% on Friday.

And if it’s not the election outcome, what caused the sudden collapse in the lira? The reason, as we pointed out on Friday, was a dire note by Goldman FX strategist, Clemens Grafe, in which among other things, he found that the central bank’s “net foreign assets fell by US$3.2bn to negative US$14.8bn”, warned that “given the slowdown in the rise of TRY deposits and this week’s decline, we think TRY liquidity in the system is becoming more limited” and, most ominously, predicted that “pressure on the reserves has shifted from the current to the capital account despite the measures in place to limit capital outflows. “

Below we excerpt from the Goldman note which, if accurate, could lead to a rapid and dramatic reprising of the lira far lower from its current, manipulated, and artificially-lofty level:

As of 17 May, the TCMB’s foreign assets declined sharply by US$6.7bn to US$104.4bn compared with a week ago, against a US$3.5bn fall in foreign liabilities to US$119.2bn (US$2.0bn fall in liabilities to nonresidents and US$1.5bn to banks). Hence, net foreign assets fell by US$3.2bn to negative US$14.8bn.

TCMB’s swaps with banks declined only slightly, by US$0.5bn compared with a week ago, to US$36.6bn as of 17 May, whereas FX deposits in the overall banking system fell much more, by US$4.0bn (as of 15 May) to US$213.9bn (TRY deposits also declined by TRY9.3bn to TRY6,197.0bn).

The decline in both TRY and FX deposits signals that funds are leaving the system amid heightened uncertainty before a presidential election runoff on Sunday, 28 May. Given this, we think stopping leakage from the system and keeping the Lira stable are the TCMB’s primary concern at the moment, also reflected in the currently high premiums placed on both FX and TRY cash in Turkey.

Using traditional measure for the TCMB’s usable reserves (subtracting gold, bilateral swaps with other central banks and SDR allocation from total reserves) points to only US$29.4bn FX liquidity at the TCMB. This number is, however, from last week given that the TCMB publishes its reserve composition with a week lag. And the decline in foreign assets this week means that it is currently even lower. However, we think that this way of measuring the TCMB’s FX assets has become somewhat outdated for two main reasons.

• First, the central bank’s recent interventions in the market to support the Lira via selling a significant portion of its gold reserves amid high household demand means that gold is becoming more of a liquid asset and arguably shouldn’t be fully subtracted.
• Second, swaps with other central banks have been used in bilateral trade between Turkey and the source countries. This means that their contribution to reserves has already declined since the swap lines were created and hence they should not be taken out in full (however, we do not know what percentage of them have been used for trade).

While these factors make the calculation of the TCMB’s FX liquidity much more complex, they also mean that the Bank’s liquid assets are likely higher than the implied US$29.4bn by our traditional measure.

This week brings the total decline in the TCMB’s foreign assets in May to US$10bn, more than half of which was driven by a fall in the TCMB’s liabilities (US$5.8bn), to nonresidents (US$1.3bn) and to banks (US$4.4bn). We think some of the decline in the TCMB’s liabilities to banks is explained by a US$2.7bn fall in overall FX deposits in the system over the same period leading to a lower level of required FX reserves to be held at the central bank. The rest of the fall in banks’ deposits at the TCMB could reflect a shift into swaps, which rose by US$1.8bn despite the fall in FX deposits over the same period. However, the TCMB’s liabilities to the banking sector have been on a downward trend since mid-April falling by US$7.8bn, and this is only partially explained by developments in overall FX deposits in the system.

This, in our view, could be signalling that banks are under FX liquidity pressures after bringing in most of their FX assets from abroad and funding half of the current account deficit last year, and are now in need of withdrawing FX from the central bank. Turkish banks’ liquidity position has been declining since September last year and their net FX deposit position has turned negative since November. We think this is a signal that pressure on the reserves has shifted from the current to the capital account despite the measures in place to limit capital outflows.

Compared with a week ago, the TCMB increased its net traditional funding by TRY32.5bn to TRY487.2bn, as of 18 May. However, given the slowdown in the rise of TRY deposits and this week’s decline, we think TRY liquidity in the system is becoming more limited.

This is reflected in increasingly restricted access to credit for both households and most corporates. Despite limited liquidity in the system, however, the TRY 13-week loan growth rate continues to increase, this week by 2.5pp to 109.3% (annualized.) as of 15 May.

In our view, the discrepancy between limited liquidity and a rising loan growth rate is explained by higher funding to some select sectors at cheap rates by the TCMB itself and that access to credit is still difficult for most in Turkey.

Goldman’s report effectively recaps what happened last week, when Turkey’s gross foreign exchange reserves posted a record fall in the week before Sunday’s inconclusive elections, as the central bank expanded efforts to support the lira.

The reserves dropped by $7.6 billion in the week to May 12 to $60.8 billion, central bank data showed — the biggest weekly fall in the figures going back to 2000. Net reserves as defined by the IMF, including swaps, also fell to $2.3 billion, the lowest in over two decades.

The data mark an acceleration in attempts to defend the currency (which in turn is driven by an accelerating rush by the population to converted increasingly worthless lira into hard currency), seen by citizens as a key barometer of the economy’s health and a major point of contention in the election.

It’s not just FX: Turkey’s five-year credit default swaps climbed 16bps on Thursday, extending this week’s advance to 185bps, climbing to the highest level since Oct. 28, and following last week’s biggest 3-day jump in 2 years. The move in CDS suggests a “challenging picture” for the lira, Istanbul-based Unlu&Co. wrote in its daily report. The rising trend in USD-TRY is “likely to continue in the short-term,” it said.

More in the full note available to pro subs.

Authored by Steve Watson via Summit News,

Journalist Glenn Greenwald has highlighted how a new Harris-Harvard poll, which has been covered practically nowhere in the mainstream media, displays how Americans hold almost wholly opposite opinions to liberal corporate media narratives.

A newly released Harris-Harvard poll conclusively demonstrates how radically out of touch is liberal corporate media with the views of Americans.

It’s not just that corporate media rejects Americans’ views. They don’t permit those views to be heard.https://t.co/Lor6QSUnl6

— Glenn Greenwald (@ggreenwald) May 21, 2023

Greenwald noted that majorities of Americans consider ‘Russian collusion’ as a false story, and believe the Hunter Biden laptop story was never ‘misinformation’, despite relentless media propaganda stating the opposite:

Americans also believe that the materials on the Hunter Biden laptop are real, and are not and never were “Russian disinformation.”

So again, Americans view the claim that the US corporate media and CIA spread for weeks before the 2020 election – to help Biden win – as a fraud. pic.twitter.com/aPYmU4jqyz

— Glenn Greenwald (@ggreenwald) May 21, 2023

Greenwald also noted how majorities believe the Bidens have engaged in criminal activity and the at the FBI is refusing to investigate.

The journalist also noted how the poll found large majorities want sweeping reform of the FBI and are not surprised it has abused its power to help Biden.

*Large majorities* of Americans say they are not surprised to learn the FBI abused it power in the 2016 Trum/Russia probe to help Biden.

*Large majorities* also say they are deeply worried about the US Security State’s manipulation of US politics, and sweeping reform is needed. pic.twitter.com/io4ifiq4aV

— Glenn Greenwald (@ggreenwald) May 21, 2023

The poll found that the vast majority of Americans don’t believe Biden is mentally capable of being President, and the most popular political figures are Trump and DeSantis:

The 3 political figures who are viewed most favorably by Americans are Elon Musk, Donald Trump and Ron DeSantis (Berne is next).

Musk has by far the highest favorability gap (+14). AOC’s is -13, Mitch McConnell -24.

Tim Scott and Vivek are +7. pic.twitter.com/NpKB6l4ZKB

— Glenn Greenwald (@ggreenwald) May 21, 2023

The poll also found that just 40 percent of Democrat voters intend to vote for Biden.

What’s so striking here isn’t that the corporate media relentlessly advocates views and ideologies that majorities of Americans – often large majorities – reject.

It’s that the views held by majorities are all but banned on NBC, CNN, NYT and WPost. Thus, this is not a mystery: pic.twitter.com/Xm3lh0HUzv

— Glenn Greenwald (@ggreenwald) May 21, 2023

If this doesn’t demonstrate how despised the leftist media has become then nothing will.

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