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Despite Big Bounce, Banks & Crude End Week Down Hard; Gold At Record Highs

Despite Big Bounce, Banks & Crude End Week Down Hard; Gold At Record Highs

An odd week of data that ‘surprised’ in its convenience: Housing data – awesome? Labor data – awesome? Personal/Household data – sucks balls!

Source: Bloomberg

Talking of convenient – after a mass media narrative focus that the banking crisis is not real but is all due to short-sellers, today saw (guess what) a gigantic short-squeeze in several regional banks (PACW up almost 100% at one point)…

BUT… regional banks were still down hard on the week…

Source: Bloomberg

Oh, and who are you gonna blame for the collapse in bonds (and feel free to argue with the biggest flow desk on the street which saw longs liquidating… not shorts piling on)…

Oh, and don’t forget the debt ceiling is looming ever closer…

Source: Bloomberg

The market’s expectations for The Fed tumbled dovishly this week as Powell hinted it’s over…

Source: Bloomberg

Markets are now pricing in rates being 75bps lower than current levels by year-end…

Source: Bloomberg

But it was Friday so we squeezed hard today, totally ignoring Bullard’s comments late on…

Bullard’s message was clear – this is not a pivot!

“The aggressive policy we pursued in the last 15 months has stemmed the rise in inflation, but it is not so clear we are on” a path to 2%, Bullard told reporters following an event in Minneapolis Friday.

He said he is willing to assess the economic data as it comes in, but would need to see “meaningful declines in inflation” to be convinced higher rates aren’t necessary.

However, despite the bounce, only Nasdaq made it back into the green for the week (but the last few minutes saw selling push it back red) while The Dow was the ugliest horse in the glue factory…

Big short squeeze today took ‘most shorted’ stocks back to unchanged on the week…

Source: Bloomberg

But notably, 0DTE was aggressively fading the early gains in stocks before reversing…

Source: SpotGamma

Most notably, the early action was all put buying and the late surge was not covering but call-buying…

Source: SpotGamma

Despite a big tumble today, equity risk higher (VIX) on the week for the first time in two months

Source: Bloomberg

Credit risk was higher on the risk…

Source: Bloomberg

Bonds were mixed on the week with the short-end bid, long-end offered…

Source: Bloomberg

Yield curve steepened significantly on the week…

Source: Bloomberg

Dollar down notably again (7th of last 9 weeks)

Source: Bloomberg

Bitcoin was flat on the week while Ethereum notably outperformed (topping $1950)…

Source: Bloomberg

Gold & Silver were up on the week with the latter outperforming (amid a lot of chop)…

Oil & NatGas were down hard on the week, despite the bounce today.

Oil’s midweek flashcrash seemed to flush some hands out…

NatGas was just a sell every rip market all week…

Gold ended just shy of a record weekly closing record high…

Source: Bloomberg

Finally, bear in mind that the market is still massively more dovish than The Fed’s expectations… (market sees a 38% chance of a cut in July)

Source: Bloomberg

Chicken or egg – for The Fed to fold, the market will have to crash but the market won’t crash because everyone knows The Fed will fold and juice stocks back to un-reality… tick-tock!!

Tyler Durden
Fri, 05/05/2023 – 16:00

David Stockman On Tucker Carlson’s Firing And Corporate-Suicide Run Amok

David Stockman On Tucker Carlson’s Firing And Corporate-Suicide Run Amok

Authored by David Stockman via InternationalMan.com,

We are not sure what the Murdochs were smoking last Monday morning when they shot the immensely profitable Fox News Channel in the kneecaps, but we do know that Tucker Carlson was one of a kind among commentators in the vast journalistic wasteland otherwise known as television news.

Indeed, on issue after issue in recent years Tucker treaded forthrightly where his MSM competitors in both print and broadcast media feared to go. Perhaps that was because he was deeply informed, historically read and literate and possessed of an incisive, open, inquisitive mind that was not about to play passive stenographer to either the Deep State or the lobbies and corporate interests that suffuse the Washington beltway.

Accordingly, Tucker has been nearly alone in smoking out the big issues of our time with a unique breadth, edge and consistency that neither Republican shills like Sean Hannity nor DNC conduits like Anderson Cooper and Rachel Maddow could hope to approach.

Thus, unlike the GOP’s neocon war-lovers and their echo chamber at Fox News, Tucker Carlson exposed the futility, stupidity and danger of the Ukraine proxy war against Russia. And he did so thoroughly and aggressively, exposing serial Deep State war-promoters like Victoria Nuland, while giving learned and incisive refugees from the national security apparatus like Colonel Douglas Macgregor a forum to refute the official lies and delusions.

By the same token, he had gone after the Dem/left earlier on when he relentlessly debunked the RussiaGate hoax. His facts and truths about this latter-day outbreak of McCarthyism are now unassailable, but at the time their mere mention was strictly verboten on the Dem venues at CNN, MSNBC, the broadcast networks and the New York Times/Washington Post axis.

Similarly, he was on to the Covid Lockdown scam early on and did not hesitate to follow the facts and the truth as the Vaxx fiasco unfolded. So doing he gave a platform to the likes of Alex Berenson and Robert Kennedy Jr. at Fox News where they otherwise had no prayer of being heard. And he did so because they were right and worthy of the airtime he seconded to them.

Then there is the whole assault on free speech, civil liberties and an independent 4th estate by the Silicon Valley giants. Tucker didn’t hesitate to expose how the latter had been drafted into the cause of Washington ordered censorship, cancellation, deplatformings and propagation of official propaganda.

Of course, this terrain was the historical bailiwick of the liberal media ala the Pentagon Papers (NYT) and the Watergate expose (Washington Post). But they were nowhere to be seen when (the old) Twitter, Facebook and YouTube/Google signed-up for censorship duty on Covid, Ukraine, the Climate Change Hysteria, the Black Lives Matter scam, the LGBTQIA+ insanity, the January 6th insurrection baloney and sundry other tenets of politically correct opinion. So Tucker filled the news void with aplomb and sagacity.

He was especially on the mark about the January 6th insurrection narrative as peddled by the MSM and the Washington uniparty leadership. For crying out loud, it wasn’t an insurrection or anything that even smelled like a coup or a remote threat to American democracy.

Instead, it was a spontaneous riot and hurly-burly assemblage in the nation’s Capitol Building enabled by abysmally poor police work. The rioters were unarmed, unorganized and unprepared for anything except to eventually be shooed out of the building after they had unexpectedly been given entry by sympathetic Capitol Hill police officers. Tucker Carlson’s vivid video segments of Jacob Chansley (aka the QAnon Shaman) being escorted around the building by these officers put the lie to the whole January 6th narrative in one delicious fell swoop.

Even on a very specific matter like the shocking sabotage of the Nord Stream 2 pipeline it was Tucker Carlson who put America’s most capable and renown journalistic investigator, Seymour Hersh, back on the news platform. My god, the Russians didn’t blow up their own pipelines and neither did the other part owner in Germany.

So who had the means and the remit to do it without Washington’s blessing or participation? Tucker rightly pointed the finger where it belongs—straight at Joe Biden— when the rest of the media remained deaf and dumb about one of the most egregious act of war during recent times.

There was also the matter of Fox Corporation’s 15% shareholder. We are referring to Blackrock and its kindred asset-manager bullies, who have forced the wholesale politicization of financial decision-making upon the markets, led by the hideous scam called ESG and the implicit decarbonization-based industrial suicide on which it is predicated. Tucker Carlson took them on with elan, even as the natural venue for this issue—CNBC and Fox Business—remained largely mute.

Still, amidst the daily Gong Show that passes for politics, finance and media news in America and the radio silence on all these crucial matters among the MSM, there was one reassuring fact: Tucker’s average nightly viewership at about 3.25 million during the first quarter of 2023 was more than 1.6X the combined 2.03 million of lobotomized lefties and/or liberal sheeples that tuned into Anderson Cooper (CNN) and The All In With Chris Hayes Show (MSNBC) during the 8PM slot.

Needless to say, Tucker’s audience isn’t going to vanish. And he will undoubtedly find a way to reconnect with it via one of the lesser conservative networks or thru some new streaming/podcast style gig worked-out with the likes of free speech patrons such as Elon Musk.

That is to say, the big spark of revolt against the mainstream establishment ignited by Tucker Carlson is gonna have legs, even as his shocking cancellation reminds that today’s rulers will stop at nothing when it comes to preserving their power and pelf.

And that includes economic asphyxiation by means of politics-based, not market-based, corporate actions. That is, Tucker Carlson should be an advertisers gold mine, but apparently the kind of woke deputy assistant marketing directors that savaged their own employers at Budweiser, Nike and Disney, among others, had been hard at work promoting boycotts of the Carlson brand long before the ballyhooed settlement with Dominion Voting Systems.

A commentator at American Thinker, for example, has suggested that Tucker’s massive viewership was not translating fully into ad dollars due to a de facto boycott by woke Corporate America.

According to the author, Seth Grossman, a particular heated Carlson diatribe on immigration which aired in December 2018 was actually the beginning of the end.

Within days, at least 26 mainstream corporate sponsors publicly announced that they would no longer sponsor the Tucker Carlson program.

Those sponsors included CareerBuilder, Takeda Pharmaceuticals (makers of Entyvio), TD Ameritrade, IHOP, the United Explorer credit card, Just For Men, Jaguar Land Rover, Ancestry.com, SCOTTeVEST, Zenni Optical, Voya Financial, Nautilus, Inc. for Bowflex, SmileDirectClub, NerdWallet, Minted, Pacific Life insurance, Indeed.com, Norwegian Cruise Lines, Red Lobster, Farmers Insurance, Lexus/Toyota, Mint Mobile, Graze snacks, Samsung, SodaStream, Pfizer’s Robitussin and SanDisk.

When these sponsors left, Tucker Carlson had only “second tier” sponsors paying much lower rates. They included My Pillow, Relief Factor, and Granite Stone pots and pans. The Tucker Carlson program may have had a superstar, prime-time audience. But it had the income of something like a 1970s late-night TV show sponsored by Veg-O-Matic and Ginsu Knives.

Money from “second tier” advertisers alone cannot sustain a prime-time TV program on a major network very long. Although Tucker Carlson was on the air until last week, it was doomed since December of 2018.

It is true that even we were getting pretty tired of the Pillow Man. But when you peruse the commentary of the corporate brands which apparently joined the boycott, it’s pretty evident that the woke capture of the top echelons of Corporate America has now reached alarming proportions.

A spokesperson for TD Ameritrade said: “Once news broke about this issue, we instructed our media buying team to avoid the show in the future. This is a decision that we believe is in-line with the strong values of our organization — one of which is People Matter.”

“At our core, we stand for welcoming folks from all backgrounds and beliefs into our restaurants and continually evaluate ad placements to ensure they align with our values,” a spokesperson for IHOP told THR on Tuesday afternoon. “In this case, we will no longer be advertising on this show.”

“Our purpose at CareerBuilder is to help people build a life that works. Not some people. All people……Which is why, last Friday, we permanently suspended advertising on some Fox programming, including Tucker Carlson Tonight. We will continue to advertise on programs that align with who we are and what we value.”

Nautilus Inc. has pulled advertising from the show. “We can confirm that Nautilus, Inc., parent company for Bowflex, has pulled its ads from the Tucker Carlson Tonight show,” the company said. “We buy media broadly across many news networks, and do not target ads based on specific programs or hosts. However, we have requested that Fox News remove our ads from airing in conjunction with Tucker Carlson Tonight in the future.

Voya Financial, which advertised most recently on Carlson’s Dec. 7 show, said on Twitter that it has no scheduled advertising placements on the show: “We’re committed to diversity, inclusion and equality – and respect for all individuals.”

Pacific Life Insurance Company was the first to suspend advertising on Carlson’s show in response to his comment. “As a company, we strongly disagree with Mr. Carlson’s statements,” it said Friday. “Our customer base and our workforce reflect the diversity of our great nation, something we take great pride in.

Just For Men has no further plans to advertise on Tucker Carlson’s show,” a company spokesperson said earlier on Tuesday afternoon. “The brand is always considering ways to remain responsible, and this includes aligning with partners who share our brand value.”

There is not an iota of business rationale for these advertiser cancellations. After all, Tucker Carlson’s viewers were self-selected at the prime 8 PM hour because they overwhelmingly agree with him and some even get off on his brilliant polemics. So how in the world would an ad for IHOP tarnish its brand among Tucker’s loyal millions?

Yes, CNN spends an ungodly amount of air time replaying Tucker’s monologues and interviews to ridicule them. But even they are not about to waste air time exposing his advertisers to their woke viewers!

The irony here, of course, is that the Carlson diatribe against immigrants, which triggered this advertiser boycott, was way off the mark, as we see it. On this issue he has been just plain wrong, and has erroneously conflated a whole series of separate issues that have different answers. That is to say, get rid of the drug war and prohibitions, put a stern legal wall around non-citizen access to welfare, and enact a large-scale guest worker program to serve the shortage-afflicted domestic labor market that desperately needs more workers.

That would clear the mess at the borders and solve Tucker’s misguided immigrant preoccupation in a heartbeat, but would also underscore the larger point. To wit, how to handle immigrants and so-called border security is a classic two-sided debate subject to a broad range of facts, interpretations and values. It is intended for the halls of Congress, therefore, not the decision calculus of deputy assistant marketing directors in corporate America.

At the end of the day, it is no mystery as to how the likes of Dylan Mulvaney knocked what is now 21% off Bud Light’s sales with such alacrity when Coors and Miller have failed for years to nibble away even a fraction of that plunge; or why national advertisers have been taking a pass on the best rated news show on cable prime time.

To wit, decision-makers in corporate America are so deep in Fed-enabled stock option riches that they are not resolutely attending to business and are allowing the ideological and political infatuations of their younger, wokish staffs to stand in the way of profit maximization. In a word, a corporation desperate for higher profits in order to earn a higher share price the old fashioned way through earnings expansion rather than PE inflation would have never put the hideous face of Dylan Mulvaney on a can of their beer. Nor would it be confronted with this kind of news story:

During the week ended April 22 — the most recent industry data available — Bud Light sales plunged 21% vs. a year ago, accelerating from a 17% slide a week earlier and an initial weekly drop of 6% when the controversy kicked off during the first week of April, according to Nielsen IQ and Bump Williams Consulting.

So what we need is a good old-fashioned stock market crash. In one fell swoop that would wake-up the corporate C-suites and trigger a massive purge of the woke staffs, operations and costs which are now eating away at profits and undermining corporate brands and assets.

Regardless of how long that reckoning takes to materialize, and it will happen, it is certain that Tucker Carlson will soon have a new and better platform. And when the stock options of the Fortune 500 C-suites go to zero, they will stampede their ad dollars to Tucker’s new venue.

After all, capitalists not bamboozled by vastly inflated stock prices historically put their advertising dollars where the audiences were. And they soon will again.

That’s the real meaning of the current Cable Guy Gone episode. The monetary floozies in the Eccles Building have temporarily enabled the woke occupation of the corporate C-suites.

Fortunately, however, they have swaddled themselves in a viscous stagflation, meaning the Fed floozies have performed their last “easy” money trick for a long time to come.

*  *  *

The wave of political correctness and liberal group-think has taken the US by storm. The effort to silence opposing viewpoints and free speech will continue to accelerate. That’s why Doug Casey has prepared a timely video on surviving this modern American trend. In it Doug exposes the lies and mainstream bias that’s poisoning America… Click here to watch it now.

Tyler Durden
Fri, 05/05/2023 – 15:40

Consumer Credit Shocker: Credit Card Debt Explodes At 2nd Fastest Pace On Record Just As Rates Hit All-Time High

Consumer Credit Shocker: Credit Card Debt Explodes At 2nd Fastest Pace On Record Just As Rates Hit All-Time High

So much for credit being tight.

One month ago, not long after we warned that consumer credit was about to get much tighter in the aftermath of one of the most depressing Senior Loan Officer Opinion Surveys, which saw near record tightening in lending standards coupled with a historic plunge in credit demand, we observed that – as one would generally expect – growth in US credit card debt had ground to a crawl, as revolving credit rose by just $5 billion, down sharply from the $12.8 billion in January, down from the $13.7 billion LTM average, and the lowest single increase since April 2021.

Looking at the data, we concluded that “while it is unclear if credit card usage rose at the slowest pace in two years due to weak demand or a sudden squeeze in supply – obviously we will have more information in one month when the next SLOOS hits – the implication is clear: one of the most powerful economic lifelines is grinding to a halt.”

Well, maybe not. Ever hear the saying never bet against (the stupidity of) the  US consumer? Well, fast forward one month when moments ago the latest consumer credit data from the Fed was released and it was a doozy: instead of printing at a “credit-crunchy” subdued level, with the Street expecting only a modest increase from February’s $15 billion to $17 billion in March, the Fed reported that the actual amount of new credit card debt was a whopping $26.514 billion, smashing expectations by almost $10 billion.

But while the total number, while high, was generally in line with historical prints, it was the components that were remarkable.

For once, we will start with the non-revolving credit, where the number was a big shock, or maybe not so big, because while historically the average number had been in the mid-teens, in March non-revolving credit, or student and auto loans, increased by just $8.9 billion, the 4th consecutive month in a row below $10 billion, the weakest such stretch since the covid crash.

The reason for the slump in nonrevolving credit: as shown in the next chart below which shows the quarterly increase in non-revolving debt components, while student loans increased a mighty $20BN in Q1, auto loans rose by just $10.1 billion, the weakest increase since 2020. And yes, with auto loans at record high interest rates, this is not a shock.

What was shocking, was the monthly change in the other big category, revolving credit. As shown in the next chart, after rising at the lowest pace since August 2021, the March change in credit card debt absolutely exploded, soaring by $17.6 billion, more than triple the February total, and the second biggest monthly increase on record!

It’s as if, either consumers – realizing this is their last hurrah to spend – went out and maxed out their cards at a pace (almost) never seen before, or perhaps the banks, desperate to load up peasants with some more debt, were handing out credit cards like hot cakes and the result is shown below.

And while such a move could at least be explained, if not justified, when rates were at zero – after all the cost of money back then was negligible – this time it’s a little more difficult to explain what is going on, especially when one sees the next chart from the Fed, showing that average credit card interest had just hit a record high 20.9%.

And so the scene for both the next crisis and credit crunch are set, because just like Americans couldn’t afford their mortgages in 2008, hoping instead that some greater fool would take it off their hands at the right moment, so too now they are maxing out credit cards (just as rates hit all time high) knowing they will never repay the debt, but instead hope that the coming bank crisis will allow them to quietly sneak away without repaying their debt. Come to think of it, the bank crisis is already here…

 

Tyler Durden
Fri, 05/05/2023 – 15:29

$50 Trillion For What? Kennedy Dumbfounds Biden Climate Peddler In Fiery Exchange Over ‘Carbon Neutrality’

$50 Trillion For What? Kennedy Dumbfounds Biden Climate Peddler In Fiery Exchange Over ‘Carbon Neutrality’

Biden Deputy Secretary of Energy David Turk highlighted the absurdity of the climate grift this week during a Senate Appropriations Subcommittee hearing, when Sen. John Kennedy (R-LA) couldn’t get a straight answer out of him over the cost of going ‘carbon neutral.’

In a tense exchange, Kennedy repeatedly attempted to get Turk to give a straightforward answer to just how much American taxpayers will have to pay to achieve the Biden administration’s goal of reaching US carbon neutrality by 2050.

When Kennedy asked whether some of the “experts” Turk referred to earlier were correct in a $50 trillion estimate, Turk nodded his head, and said “It’s gonna cost trillions of dollars, there’s no doubt about it.”

“f we spend $50 trillion to become carbon neutral by 2050 in the United States of America, how much is that going to reduce world temperatures?” Kennedy replied. The conversation continued (transcription via the Daily Caller)

Turk: “So, every country around the world needs to get its act together. Our emissions are about 13% of global emissions right now…”

Kennedy: “Yeah, but if you could answer my question. If we spend $50 trillion to become carbon neutral in the U.S. by 2050, you’re the Deputy Secretary of Energy, give me your estimate of how much that is going to reduce world temperatures.”

Turk: “So, first of all, it’s a net cost. It’s what, um, benefits we’re having from getting our act together and reducing all of those costs and climate benefits…”

Kennedy: “Let me ask you. Maybe I’m not being clear. If we spend $50 trillion to become carbon neutral by 2050 in the United States of America, how much is that going to reduce world temperatures?

Turk: “This is a global problem, so we need to reduce our emissions and we need to do everything to, uh…”

Kennedy: “How much of we do our part is it going to reduce global temperatures?”

Turk: “So, we’re 13% of global emissions…”

Kennedy: “You don’t know, do you? You don’t know, do you?”

A fully flabbergasted Turk then says “In my heart of hearts, there is no way the world gets its act together on climate change unless the U.S. leads.”

Watch (with full exchange here):

As energy expert David Blackmon writes in the Daily Caller;

And there we have it. Americans are being asked to accept the force-feeding of an incredibly radical set of policies with a price tag that is unprecedented in global history to achieve a “carbon neutrality” goal, whose benefits are so nebulous, negligible and wholly reliant on the cooperative actions of other countries beyond U.S. control that they cannot be measured in any reliable way.

Instead, we are being told by senior political appointees forcing those policies into being that we should simply trust them because they think it is the right thing to do in their “heart of hearts.”

This is madness. For some context, $50 trillion is an amount that exceeds the gross domestic product of the U.S., China, India, Germany and Japan, combined. It is a number that drastically exceeds total U.S. national debt. It is more than 135 times the $369 billion in green energy subsidies contained in last year’s Orwellian-named Inflation Reduction Act (IRA).

That is five new IRAs each year for the next 27 years. Madness.

Madness indeed.

Tyler Durden
Fri, 05/05/2023 – 15:00

Goldman: Has Ethereum Become A Deflationary Asset?

Goldman: Has Ethereum Become A Deflationary Asset?

After the flash crash drop last week on ‘fake news’ about Mt.Gox holdings moving, Ethereum has outperformed and erased all those losses (and above $1950) as banking sector chaos is enabling decentralized financial systems to showcase their transparency and resilience versus traditional markets….

Source: Bloomberg

Ethereum’s relative performance to bitcoin has been volatile in recent weeks around the major Shapella upgrade, but once again ETH is outperforming BTC in recent days…

Source: Bloomberg

One potential driver of ETH’s regained popularity is its appeal as a deflationary asset, a topic Goldman’s Crypto desk recently explained:

Ether, as an asset, is the fuel powering and securing the Ethereum protocol.

To use the Ethereum network, users pay fees in ETH to execute transactions and use applications built on Ethereum.

In return, this fee and staking rewards (denominated in ETH) incentivize validators to secure the network. ETH’s value is a function of multiple factors, depending on one’s view of ETH as an asset – a store of value, means of exchange or a financial asset.

At its genesis in 2014, ~72m ETH supply was pre-mined, with current supply at ~118m ETH (Etherscan).

Since then, ETH’s economics have undergone changes on the back of Ethereum protocol’s two recent protocol upgrades – the London hard fork and the Merge.

  • The London hard fork introduced changes to the fee mechanism, whereby the gas paid for transaction is quoted in form of a base fee plus and op on to tip the validator (priority fee). The base fee is burnt and the validator receives the tip and block reward. The base fee burn decreases the net ETH issuance (the later in form of staking rewards). However, it heavily depends on Ethereum network activity. More on-chain activity = more ETH burnt.

  • Following the Merge, Ethereum’s transition to Proof of Stake (background on PoS – here) reduced ETH issuance by ~90% (Daily ETH issuance declined from ~13k to ~1.7k ETH). (More on ETH supply – here).

On the back of these upgrades, the net ETH issuance is lowered by (i) the base fee burn and (ii) the decline in block rewards.

This is what led ETH to be referred to as ‘ultra sound money’ (best explained by Justin Drake at Devcon Bogota).

Has ETH become a deflationary asset?

Since the Merge (Sep’22), ETH has become an increasingly deflationary asset over the past months (Figure 1).

In 2023 alone, ~374k ETH has been burnt (Figure 1).

In April, daily ETH issuance has been deflationary every day.

This trend is on the back of increased on-chain activity, led primarily by DEXes, NFT platforms and stablecoins.

Tyler Durden
Fri, 05/05/2023 – 12:45

Soros-Backed St. Louis Attorney Kim Gardner Resigns

Soros-Backed St. Louis Attorney Kim Gardner Resigns

Authored by Eric Lundrum via American Greatness,

On Thursday, a progressive prosecutor who was notoriously funded by far-left billionaire George Soros announced her resignation, after months of bipartisan pressure to do so.

Fox News reports that Kim Gardner, the Circuit Attorney for St. Louis, announced that her resignation will be effective June 1st. Gardner was one of the first prosecutors in the country to be bankrolled by Soros, who has since expanded his efforts to other major cities across the country. She was first elected in 2016 and re-elected in 2020, largely due to Soros’ financial backing. Prior to her resignation announcement, she had declared her intention to run for a third term in 2024.

After years of criticism for being soft on crime and siding with criminals over victims, Gardner faced a whole new wave of criticism from both parties over an incident in February: Teenage volleyball player Janae Edmonson, who was visiting St. Louis from Tennessee for a tournament, was hit by an out-of-control car while crossing the road; although Edmonson survived, she had to have both of her legs amputated.

The driver of the car was Daniel Riley, a man who was out on bond while awaiting trial for an armed robbery case. It was later revealed that Riley had violated the terms of bond dozens of times, but was never arrested. When the blame turned to Gardner for failing to keep him off the streets, she falsely claimed that her office had attempted to have Riley jailed once again, only to be denied by a judge; there are no records of her office filing any such motion or otherwise seeking the revocation of Riley’s bond.

Following the Edmonson incident, Missouri Attorney General Andrew Bailey (R-Mo.) filed a petition quo warranto, the process by which the state attorney general can fire a prosecutor who has been determined to be neglectful of her duties. Bailey claimed that as many as 12,000 criminal cases have been dismissed due to Gardner’s failures, with another 9,000 having been thrown out right before they were set to go to trial, due to Garnder’s office refusing to provide evidence and speedy trials for defendants.

After Gardner’s announcement, Bailey released a statement demanding that she vacate her office immediately, rather than wait for another month.

“There is absolutely no reason for the circuit attorney to remain in office until June 1,” said Bailey.

“We remain undeterred with our legal quest to forcibly remove her from office. Every day she remains puts the city of St. Louis in more danger. How many victims will there be between now and June 1? How many defendants will have their constitutional rights violated? How many cases will continue to go unprosecuted?”

Gardner had already faced numerous other disciplinary measures during her time as prosecutor. She was once publicly reprimanded by the Missouri Supreme Court and ordered to pay a fine, and her office is currently facing two contempt of court hearings due to prosecutors refusing to appear for multiple court dates. In one of the contempt cases, a judge described Gardner’s office as a “rudderless ship of chaos,” and said that Gardner herself showed “complete indifference and a conscious disregard for the judicial process.”

Tyler Durden
Fri, 05/05/2023 – 12:25

Ignore The Noise: Job Market Is Cracking As Birth-Death Model “Adds” Near Record 378,000 Jobs

Ignore The Noise: Job Market Is Cracking As Birth-Death Model “Adds” Near Record 378,000 Jobs

Despite today’s laughable, 13th consecutive beat of expectations in a row, a number which is only as credible as Biden’s 81 million voters…

… the weakening in the US jobs market is gathering pace, and as Bloomberg’s Simon White writes, a faster-than-expected deterioration in employment would lead the market to in price more cuts, sooner.

As White notes, month-to-month data points and revisions can often obscure the bigger picture. In the case of the labor market, it is that payrolls’ growth is weakening, especially after revisions (what will April be revised to next month).

And it’s very likely to keep doing so, and at a faster rate, and this can be directly linked to the banking turmoil. There is a very clear and intuitive leading relationship between banks’ lending standards and payrolls. The magnitude of the recent tightening in credit from banks points to payrolls’ annual growth contracting in the next few months.

Indeed, there are several other concerns that jobs data should not be taken at face value. Weaker current data and the revision lower of historical data — as happens at turning points, which typically see the largest revisions — would lead to a rapid re-appraisal of the health of the labor market.

Consider this: the birth-death model added a huge 378k jobs to April’s payrolls, the second biggest monthly increase on record (only last October was higher)!

And get this: the birth-death model has added 1.84 million jobs since last March, or a whopping 43% of all payrolls added during this period. This means that almost half of all “job gains” in the past year are from an excel spreadsheet which assumes 1.84 million new jobs were created from new businesses.

This has come during a period where the employer survey-response rate to the BLS, which compiles the payrolls data, has collapsed.

There may be correlation with no causation here, but it is not imprudent to wonder whether, in the absence of as many survey responses, the model has had to more work than usual, and that reported numbers have significantly diverged from the underlying picture.

It’s also noteworthy that there continues to be a significant divergence between household employment (which counts employees) and the payrolls survey (which counts jobs). Over 1.2 million more jobs have been created than new employees since March last year. It’s not a vote of confidence in the jobs market if a rising number of people feel they need more than one position to pay their way.

Tyler Durden
Fri, 05/05/2023 – 12:06

Wagner Chief Warns His Forces To Exit Bakhmut On May 10 While Military Leaders “Sit Like Fat Cats”

Wagner Chief Warns His Forces To Exit Bakhmut On May 10 While Military Leaders “Sit Like Fat Cats”

The infighting between Wagner Group mercenary firm and Russia’s defense ministry has come to a head, as on Friday Wagner chiefYevgeny Prigozhin declared he’s withdrawing his forces from Bakhmut on May 10 for lack of ammunition. He’s issued fierce complaints for weeks that ammunition is being withheld from the military chain of command as internal tensions have exploded into public view.

“I declare on behalf of the Wagner fighters, on behalf of the Wagner command, that on May 10, 2023, we are obliged to transfer positions in the settlement of Bakhmut to units of the Defense Ministry and withdraw the remains of Wagner to logistics camps to lick our wounds,” Prigozhin said.

“I’m withdrawing Wagner PMC units because without ammunition, they are doomed to a senseless death,” Prigozhin continued, asserting that his firm had fallen “out of favor with envious near-military bureaucrats.”

The day prior to this he issued a separate dramatic battlefield video on Telegram declaring “We are lacking 70% of the needed ammunition!” The clip is dramatic and disturbing as it shows Prigozhin standing over dozens of his fighters killed on the Ukrainian battlefield, while blaming their deaths on lack of adequate support. 

In the video, he expressly calls out the defense minister and chief of the armed forces: “Shoigu, Gerasimov, where … is the ammunition?” says Prigozhin. “The blood is still fresh,” he says of bodies around him. “They came here as volunteers and are dying so you can sit like fat cats in your luxury offices.”

It is by far the most scathing attack on the regular chain of command as well as unsupportive politicians at home launched by the Wagner chief, following weeks of public verbal denunciations and even warnings to take the matter directly to Putin, who is no doubt fully aware of the spat. The Thursday social media message included the following moment

“These are someone’s f**king fathers and someone’s sons. And you f**kers who aren’t giving [us] ammunition, you b*tches, will have your guts eaten out in hell!” yelled Prigozhin in Thursday’s video.

Prigozhin has already threatened to quit Bakhmut before – but it would be a huge blow to the Russian advance there, given they already control some 90% of the strategic city in Donetsk oblast. There’s growing speculation that this rift has sparked elite infighting within the halls of the Kremlin.

He’s repeatedly charged the regular military command with “betraying” his fighters by withholding ammunition in the ongoing spat which became public with the Russian seizure of Soledar. A Wagner statement at the time declared victory over the city for itself, but controversially didn’t acknowledge the role of the regular military. The infighting has increasingly been out in the open since then, and is no doubt somewhat of an embarrassment while facing down NATO and the Western allies.

Tyler Durden
Fri, 05/05/2023 – 10:40

National Police Association And Other Groups Sue To Obtain Audrey Hale Manifesto

National Police Association And Other Groups Sue To Obtain Audrey Hale Manifesto

Authored by Jonathan Turley,

In March, Audrey Hale shocked the nation by opening fire at The Covenant School in Nashville, Tennessee. The police soon acknowledged that they had a manifesto from Hale on why she took this inexplicable and horrific action. We all then waited for the release of the manifesto. We are still waiting.

It is not uncommon for there to be a delay in the release of information in a major crime pending investigation. What was weird is that the police quickly confirmed that Hale acted alone and Hale was dead. There is no prosecution that will occur in the case. Yet, it is May and the authorities are still refusing to release the manifesto . . . and they will not fully explain why. Now, the National Police Association and other groups are suing to make the writings and other materials of mass shooter Audrey Hale public.

There were twenty journals, five laptops, a suicide note, yearbooks, cellphones and various notes written by Hale, 28, that were seized from the house she shared with her parents.

There have been press reports that the authorities consider the manifesto to be “astronomically dangerous.”

They may be unsettling and even dangerous, but the question is the right of the authorities to keep such evidence from the public and the press. The government can always declare information to be too “dangerous” to release for a variety of reasons. However, we have a system that defaults on disclosures and public access.

The Tennessee Public Records Act governs records created by any governmental entity of Tennessee, including the police department. Under that law, a public record covers all records “regardless of physical form or characteristic, made or received pursuant to law or ordinance or in connection with the transaction of official business by any governmental entity.” Note the verb “received.” That would include this evidence. Furthermore, “made” would include emails addressing why authorities decided to withhold the documents.

If these are public records they must be “be open for personal inspection by any citizen of this state,” and custodians cannot refuse access “unless otherwise provided by state law.”

There is an exception under Rule 16(a)(2) of the Tennessee Rules of Criminal Procedure for ongoing investigations or prosecutions, but this case is clearly not active in the sense of any additional charges. Hale is dead. The law does not contemplate that the government can simply declare that a case is forever pending as a way to avoid disclosures.

I do not know what is in the manifesto or why it is so unnerving for authorities. However, what is clearly “dangerous” is for officials to flaunt the law and withhold information from the press and the public.

Tyler Durden
Fri, 05/05/2023 – 10:20

ADP Jobs Data Are Now Much More Accurate Than Nonfarm Payrolls

ADP Jobs Data Are Now Much More Accurate Than Nonfarm Payrolls

By Peter Tchir of Academy Securities

Total jobs at 253k are very good, but that number came with downward revisions of 149k, which will help keep the Fed at bay. It also makes me wonder why the market doesn’t pay more attention to ADP? Last month ADP was 142k versus an original print of 236k on NFP, which just got revised down to 165k. Two months ago, ADP was 261k while NFP was over 311k, that got revised down to 248k. With low NFP survey response rates and a revised ADP methodology, maybe ADP day should be more important?

As a reminder, this is what the dramatic NFP revisions looks like.

Unemployment rate dropped from 3.5% to 3.4%, though it seems more like a function of rounding than a meaningful drop). The household survey only increased by 139k with civilian labor force declining a touch, hence the move from 3.5% to 3.4% isn’t as strong as it might appear, but it will catch the Fed’s attention.

Earnings could be problematic for the Fed. Last month’s annual rate of 4.2% was nudged up to 4.3% but more importantly, this month showed a 0.5% increase, the largest monthly increase since 0.6% in March 2022! (July 2022 tied at 0.5%). There might be some “devil in the detail” issues with this number, but for anyone not looking at the nuances of the data, this will bring up concerns about inflation and the Fed.

A report, that overall will give the inflation hawks at the Fed some pause, and keeps us in the one and “donish” camp than the definite pause camp.

Banks

Bank stocks bouncing this morning, thankfully, though it might be linked to headlines suggesting that a short sale ban is coming. Maybe it is, and maybe it will help, but my recollection from the GFC and European Debt Crisis, is all that short selling bans do is cause a brief pop as some shorts cover, only to create a bigger problem (a lack of short covering bids) if the problems that started the selling originally, attract attention.

Do Stock Buybacks Trump QT?

I do believe that QT acts as a headwind to asset prices, but as we continue through earnings season more and more companies are announcing their buyback plans. With their blackout periods over, they can initiate discretionary purchases. That is a positive for the market and should, at the very least, neutralize the impacts of QT.

Where Do Bond Losses Come From?

I’m not sure that I have a cohesive theory or trade on the back of yesterday’s Bond Loss piece, but something tells me it is worth a read as it will gel into a stronger view on tail risk all markets are facing.

Tyler Durden
Fri, 05/05/2023 – 10:04