“They feel it will become a war zone. But many simply don’t have the means to leave Khartoum,” Al Jazeera’s Khartoum-based war correspondent Mohamed el-Tayeb observed Tuesday of ongoing efforts to evacuate foreigners, but which has still left no escape options for local Sudanese.

The United Nations High Commissioner for Refugees (UNHCR) is meanwhile preparing for hundreds of thousands of people to spill over borders into neighboring countries in the coming days and weeks, with a UNHCR briefing indicating that 270,000 people will likely go into South Sudan and Chad. 

More refugees are also expected to flood into Eritrea, Ethiopia, Egypt, Libya, and Central African Republic, after fighting has raged between the nation’s two top generals since April 15.

A new US-brokered ceasefire has been agreed upon as of late Monday, but it’s unclear whether it will collapse just like prior truce efforts, including one last Friday which didn’t hold, despite it being the Muslim holiday of Eid al-Fitr.

The Associated Press reports of the latest, “Sudanese and foreigners streamed out of the capital of Khartoum and other battle zones as fighting Tuesday shook a new three-day truce brokered by the United States and Saudi Arabia, the latest attempt to pull Africa’s third-largest nation back from the abyss.”

US Secretary of State Antony Blinken announced late Monday he had helped broker the deal, and is assisting American citizens remotely in escaping the war-torn capital, after evacuation flights secured the exit of some 70 US Embassy staffers and their families.

“In Khartoum, bus stations were packed Tuesday morning with people who had spent the night there in hopes of getting on a departing bus. Drivers increased prices, sometimes tenfold, for routes to the border crossing with Egypt or the eastern Red Sea city of Port Sudan,” the AP describes. “Fuel prices have skyrocketed, to $67 a gallon from from $4.2, and prices for food and water have doubled in many cases, the Norwegian Refugee Council said.”

The death toll is approaching 500 or more, with thousands wounded, and huge swathes of the capital destroyed…

فيديو مفزع لما آلت إليه الأوضاع في منطقة ” شمبات” بالخرطوم بحري، عقب المعارك العنيفة والقصف الجوي من قبل الجيش خلال اشتباكه مع قوات الدعم السريع المتمردة.#السودان pic.twitter.com/8JD0cxhrbu

— Sudan News (@Sudan_tweet) April 24, 2023

The International Committee of the Red Cross said it welcomes the ceasefire as a “potential lifesaver for civilians” who have remained largely trapped in their homes for days, often without electricity or water.

“It’s clear that this ceasefire must be implemented up and down the chain of command and that it must hold for it to give a real respite to civilians suffering from the fighting,” ICRC’s regional director for Africa, Patrick Youssef, said in a statement. He urged a “durable political solution to end the bloodshed” with the mediation of international countries.

Authored by Mike Shedlock via MishTalk.com,

Let’s tune into a mass exodus of deposits at banks for money market mutual funds and what it means…

Spread between bank deposit rates and money market funds from Tweet below.

Jim Bianco has a 21-Tweet Thread on what’s going on with bank deposits. I chimed in on a couple of the Tweets. Here are some of the most important ideas.

7/21

Why are big banks losing more deposits than small banks?

This graphic showing “too-big-too-fail” banks offering no yield has lost its appeal in a world of 120 million active mobile banking apps that can easily access money market funds averaging 4.70% and 5% T-Bills. pic.twitter.com/7q3RulM6YV

— Jim Bianco biancoresearch.eth (@biancoresearch) April 23, 2023

The “bank walk” becomes a “bank powerwalk” to 5%.

10/21

And not only is the gap above not closing anytime soon, but the Fed is also set to widen it even more when they hike rates again on May 3.

90% probability (chart)

Soon after, the avg money market fund will be above 5%.

The “bank walk” becomes a “bank powerwalk” to 5%. pic.twitter.com/zMDKaZ2Bvy

— Jim Bianco biancoresearch.eth (@biancoresearch) April 23, 2023

More Bank Failures?

17/21

I define it as a “bank walk,” which is intensifying.

To be clear, a bank walk will NOT lead to another bank failure, wrong metric.

But it will kill their profitability, especially the smaller banks.

This is the market’s message. Smaller banks are doing worse. pic.twitter.com/yEXmk36HhZ

— Jim Bianco biancoresearch.eth (@biancoresearch) April 23, 2023

“To be clear, a bank walk will NOT lead to another bank failure, wrong metric. But it will kill their profitability, especially the smaller banks.“

Giant Bank Sucking Sound

“Bank Powerwalk” fitting term coined @biancoresearch to describe bigger liquidity sucking sound leaving banks after @federalreserve hikes May 3 (90% probability) pressing MMF rates north of 5%, which will (ahem) amplify awareness as to what banks are NOT paying+stock market risk. https://t.co/Poj2BSnYjH

— Danielle DiMartino Booth (@DiMartinoBooth) April 23, 2023

Question On Stopping the Run 

3-Month: 5.1%
6-Month: 5.1%
1-yr: 4.77%

I suspect the answer is they need NEW Deposits because they already locked up existing deposits in 10-YR notes at 2.0% or so.

Offering 3% will not attract much new money with others offering 5%.

Meanwhile:https://t.co/xQfHZTul9U

— Mike “Mish” Shedlock (@MishGEA) April 23, 2023

Mish: “Banks need NEW Deposits because they already locked up existing deposits in 10-YR notes at 2.0% or so. Offering 3% will not attract much new money with others offering 5%.“

Agreement From Bianco

Exactly correct. They locked up securities and loans that generate much lower interest rates. Somewhere around 3%. Over time they mature and get rolled into higher rates. But nort now.

So, they lose money by trying to compete with market rates. This explains why the bank stocks…

— Jim Bianco biancoresearch.eth (@biancoresearch) April 23, 2023

Bianco: “Exactly correct: They [banks] locked up securities and loans that generate much lower interest rates. Somewhere around 3%. Over time they mature and get rolled into higher rates. But not now. So, they lose money by trying to compete with market rates. This explains why the bank stocks cannot rally.“

Second Question

Raising money at 5% would lose additional money if the Fed pivoted.

We can debate how likely that is, but the last thing banks need is more risk.

And at best it’s little more than break even. So it’s not an option that solves much. Takes time.

— Mike “Mish” Shedlock (@MishGEA) April 24, 2023

Bianco Conclusion

21/21

Conclusion

The current economy, inflation, and Fed thinking are irrelevant. What is coming next matters, as is always the case.

The answer will be the “bank walk’s” cumulative impact on markets, the economy, and lending.

It will be a significant drag later this year.

— Jim Bianco biancoresearch.eth (@biancoresearch) April 23, 2023

The “bank walk’s” cumulative impact on markets, the economy, and lending. It will be a significant drag later this year.

Moody’s Downgrades 11 Regional Banks

Please note Moody’s Downgrades 11 Regional Banks, Including Zions, U.S. Bank, Western Alliance.

Regional banks, Moody’s said, are more exposed to hard-hit commercial real estate. U.S. banks hold about half of total CRE debt outstanding, and some are concentrated in construction, office, or land development.

U.S. Bank has a “relatively low capitalization” as well as unrealized losses on its securities, Moody’s said.  Zions has “significant” unrealized losses on its securities portfolio and its capital has deteriorated, Moody’s said.

Downgraded Banks

• U.S. Bancorp USB, with $682 billion in assets

• Zions Bancorp ZION with $89 billion in assets.

• Bank of Hawaii Corp., BOH with $24 billion in assets.

• Western Alliance Bancorp WAL, received a two-notch downgrade.

• First Republic Bank, which faced a run last month, had its preferred-stock rating cut.

• Six More: Associated Banc-Corp., Comerica Inc., First Hawaiian Inc., Intrust Financial Corp, Washington Federal Inc., UMB Financial Corp.

Banks will not be taking any extra risks. Nor will larger banks that also face the “powerwalk”. This will pressure bank lending across the board.

Like it or not, the Fed is purposely angling for recession to cure inflation. 

And the Fed does not have an inflation ally in the White House. Biden is doing everything possible to fuel inflation with inept Green policies. 

Biden’s Trillion Dollar Clean Energy Grab Bag in Pictures and Quotes

For discussion of the drastically misnamed Inflation Reduction Act, please see Biden’s Trillion Dollar Clean Energy Grab Bag in Pictures and Quotes

Strangest Yield Curve in History

For discussion of how the debt ceiling has impacted the yield curve, please see The Strangest US Treasury Yield Curve in History, What’s Going On?

Finally, please recall Fed Minutes Now Predict a Recession This Year Along With Higher Unemployment

*  *  *

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By Jeran Wittenstein and Ryan Vlastelica, Bloomberg Markets live reporters and analysts

The stock market faces a major test this week when the big technology companies that have powered the S&P 500 Index’s rally this year are expected to report dismal quarterly earnings.

Profits for information technology companies in the benchmark are projected to fall 15% in the first quarter, which would be the biggest contraction year-over-year since 2009, according to data compiled by Bloomberg Intelligence. The largest tech-related companies have been the biggest contributors to the the S&P 500’s 7% advance this year, by virtue of their size and outperformance. Apple Inc., Microsoft Corp. and Nvidia Corp. alone account for nearly half of the index’s gains, according to data compiled by Bloomberg.

“The valuation premium for US megacap stocks could remain problematic for S&P 500 performance, as these long-duration equities appear glaringly mispriced with interest rates at current levels,” Bloomberg Intelligence strategists Gina Martin Adams and Michael Casper wrote in a research note on April 18.

Much of the gauge’s advance has been fueled by speculation that the Federal Reserve is nearing the end of its interest rate-hiking campaign and a flight to perceived safety — companies’ with strong balance sheets — amid turmoil in the banking sector. The rise has occurred as analysts continue cutting profit estimates for 2023, pushing valuations back into pricey territory.

Apple and Microsoft, for example, are priced around 27 times projected earnings over the next year. That’s near the companies’ highest price-to-earnings ratio in eight months and well above the stocks’ averages over the past decade.

Microsoft and Alphabet will kick off the megacap earnings season on Tuesday after market close. Meta Platforms and Amazon.com will follow on Wednesday and Thursday, respectively. Apple is due to report on May 4.

Any further deterioration in the outlook could spell trouble for the likes of Apple — the world’s most valuable company with a market capitalization of $2.6 trillion — and remove a major force supporting the broader stock market.

“Everyone had the same idea of going with the best-capitalized companies, with the strongest franchises,” Tim Pagliara, chairman and chief investment officer at Capwealth Advisors, said. “Given the environment we’re in, and the valuations, and the unique problems some of these companies have to address, there’s reason to be cautious.”

Early results in the sector may signal cause for concern. CDW Corp., a technology hardware and services company with a market value of $22 billion, dragged larger peers like Cisco Systems Inc. lower last week when it gave disappointing preliminary results. The company blamed a revenue shortfall on “intensifying economic uncertainty” that caused customers to pull back on spending.

International Business Machines Corp. CEO Arvind Krishna echoed that sentiment, noting the company is seeing “some softening” in customer spending.

“There’s concern about the Fed making a policy mistake, about earnings misses, tighter credit conditions, the situation with banks, and the big unknown about the debt ceiling,” said Keith Apton, managing director at UBS Wealth Management.

San Diego-based One America News CEO and founder Robert Herring Sr. has an offer for Tucker Carlson: $25 million to join the network.

“Maybe Fox News’ loss could be @OANN’s gain,  Founder and CEO @RobHerring would like to extend an invitation to Carlson to meet for negotiation,” the network tweeted on Monday, hours after we learned that Lachlan Murcoch had fired the #1 cable news host from Fox News.

It is still unknown what his next move will be. Many speculate that Carlson will join another right-wing network or he will create his own show.

One America News founder and CEO Robert Herring would like to extend an invitation to Carlson to meet for negotiation to become a part of the OAN team. -OAN

Tucker Carlson Leaves Fox Nation
Maybe Fox News’ loss could be @OANN‘s gain, Founder and CEO @RobHerring would like to extend an invitation to Carlson to meet for negotiation.https://t.co/O5KmsPyhyx#OAN #TuckerCarlson #FauxNews #FoxNews @TuckerCarlson pic.twitter.com/MEU3f5CG77

— One America News (@OANN) April 24, 2023

When reached for comment, Herring told Times of San Diego via email: “It would be great if we could get Tucker! I might give him around $25 million. And he would be well worth that!“

Carlson was making between $15 and $20 million a year hosting “Tucker Carlson Tonight,” according to Forbes.

He’s also received an offer from Russia’s state-sponsored RT network.

Hey @TuckerCarlson, you can always question more with @RT_com

— RT (@RT_com) April 24, 2023

According to the NYT, “Howard Polskin, who compiles a daily newsletter, TheRighting, that tracks conservative news outlets, said that Mr. Carlson could join niche networks like NewsNation or Newsmax. He could start his own media brand, like Dan Bongino, the conservative pundit who also parted ways with Fox last week, Mr. Polskin said.”

Former OAN employee, broadcast  veteran Eddie McCoven, doubts Carlson would make the move “because with such a small reach now, what budget do they have for such a big name?”

“It remains to be seen if OANN will survive the lawsuit it is facing from Dominion,” he continued, referencing an ongoing lawsuit between Dominion Voting Systems and several networks, including Newsmax and OAN. Fox News and Dominion notably settled out of court for $787.5 million just days before Carlson’s ouster, leading many to wonder if the two are related.

One day after we predicted that a short squeeze was coming for bonds as a record number of shorts had emerged in 10Y TSY futures…

And squeeze pic.twitter.com/E64lkrnU3X

— zerohedge (@zerohedge) April 24, 2023

… yields indeed have slumped, with 10Ys dropping to session lows below 3.40%, down more than 10bps on the day. So with substantial demand for safe havens, and with the short-end of the curve also benefiting, it’s hardly a surprise that today’s 2Y auction was solid

Pricing at a high yield of 3.969%, the auction stopped 4.2bps higher than last month, and tailed the When Issued 3.966% by 0.3bps. This was expected in light of the sharp decline in yield ahead of the auction.

Other metrics were far more solid: the bid to cover came in at 2.68, well above last month’s 2.44, and above the six-auction average of 2.66.

The internals were also solid, with Indirects taking down 61.2%, well above last month’s 52.8%. And with Directs awarded 19.9%, slightly below the recent average of 22.0%, Dealers were left holding 18.9%.

Overall, this was a strong auction despite the modest tail, and as yields slide lower today, we just may see another substantial squeeze send the TSY complex spiking much higher by EOD.

Via SchiffGold.com,

Americans continue to deal with rising prices even as the economy deteriorates. But the US isn’t the only country with an inflation problem. As Peter Schiff explained in a recent podcast, every country has let the inflation horses out of the barn. When you couple that with the de-dollarization trend, it’s bullish for gold.

More and more economic indicators signal a looming recession. The Leading Economic Index is now lower than in the early stages of the 2008 recession. In a recent interview, Peter said we’d be lucky to escape with just a recession.

Now, we don’t just have a weak economy, we have strong inflation. We have stagflation. This is a problem that is global, and it’s not because it’s just a coincidence that all of these countries are experiencing inflation and therefore we can’t blame anybody for it because everybody is suffering from it. No. Everybody made the same mistake. All these central banks printed too much money. They all kept their interest rates too low.”

Peter singled out England. Consumer prices in that country were up over 10% on an annual basis in March, despite aggressive rate hikes in recent months.

They have a long way to go in the UK. Rates have to go a lot higher. Government spending needs to be substantially cut. None of that is happening.”

In the past, Bank of England officials worried that inflation was “too low.” Peter said nobody over there will be talking about that again anytime soon — probably for the rest of our lives.

It’s never going to be too low. It never was too low. That was just made up. That was a pretense. But now, it’s clearly much too high, and there is no way they’re going to get that inflation rate back down below 2%. They’re probably not going to get even close to 2%. And the same thing is true with all these other countries in Europe. Everybody has let the inflation horses out of the barn.”

Peter also pointed out Japan. That country has some of the lowest price inflation in the world, but it is still higher than 2% (3.2% year-over-year).

It’s not the 10% that they’ve got in the UK, but remember, not too long ago, the Japanese had stable prices. They even had a few years where prices dropped slightly. But now they’re rising. They’re rising a lot more than 2%. And these numbers are going to go up. Why? Because interest rates are still negative.”

Even with rising prices, the Bank of Japan is targeting the yield on the 10-year Japanese Government Bond at 50 basis points. Price inflation is over 300 basis points.

This requires a lot of inflation. A lot of yen has to be printed to buy up all these bonds, because who in their right mind would want to lend money to the Japanese government at half a percent if inflation is 3%? And of course, it’s not going to stay at 3%. It’s going to go up.”

The bottom line is that we didn’t have this global inflation problem that we have now during the Great Recession – the last time economic numbers were this bad.

When you couple global inflation with the continued trend toward de-dollarization, it’s bullish for gold.

If the dollar isn’t the reserve currency, if [other countries] don’t need dollars to buy oil anymore, or other commodities because nations are now de-dollarizing and setting up mechanisms for bilateral trade in other currencies, then what is everybody going to do with these dollars? Get rid of them! And what are you going to do with the proceeds of the sale? I think most sellers of dollars would rather own gold than just pick another random fiat currency. … Just look at a chart of the price of gold. Gold is in a bull market in every single currency on the planet. So, whatever currency you’re looking at, if you compare it to gold, gold is still better. And interest rates everywhere around the world, despite the fact that they’ve gone up, pretty much every country has interest rates lower than the inflation rate. So, every country is offering negative [real] interest rates. Well, how does that compete with gold?”

In effect, central banks globally are incentivizing everybody to buy gold.

Even if you factor in the cost of storing your gold and figure, OK, it’s 15 basis points per year, so I’ve got a negative yield of .15; that’s still a higher yield than any of these currencies. … Central banks around the world are divesting [dollars] and they are building up their gold reserves. That’s why you don’t have a lot of downside risk in the price of gold. There are too many buyers beneath the market looking to buy and they will take advantage of any opportunities.”

Yesterday, when discussing the First Republic Bank Q1 earnings, we said that while the collapse in deposits (which plunged from $170BN to $70BN excluding the $30BN emergency deposit injection by a bank consortium) was scary, the potential saving grace is that FRC still had $170BN in loans, i.e., assets… loans which as Bloomberg previously reported were collateralized largely by largely money-good Hamptons real estate.

In fact, one can argue that after the next recession and the next QE, it will be Hamptons real estate that will once again be the outperformer as a new batch of nouveau-riche billionaires scramble to bid up the supply-limited housing.

The problem, however, is that many of these loans are IO (or Interest-Only), which locks the bank in for a long period of time without any substantial cash inflows (these kick in only after several years). And, of course, First Republic needs cash now in order to not only pay down its existing untenable capital structure, but to survive.

That’s why yesterday we said that one way the company can survive, is if it can sell many/most of its loans at anything close to par, it could actually survive as it could then pay down the Fed, FHLB, JPM and others, and restart operations as an ordinary bank.

*FRC SAYS IT AIMS TO REDUCE RELIANCE ON SHORT TERM BORROWINGS

FRC has $173BN in loans and $70BN in deposits (net of $30BN JPM et al deposit injection). If it can sell loans (many of which are IO loans secured by Hamptons mansions) close to par it may be able to restructure

— zerohedge (@zerohedge) April 24, 2023

Well, it appears we were on to something because moments ago Bloomberg reported that FRC is doing just this, and is “exploring divesting $50 billion to $100 billion of long-dated securities and mortgages as part of a broader rescue plan.”

The report echoes what we said, namely that any sales would help reduce the bank’s asset-liability mismatch, and furthermore, also notes that “potential buyers, including large US banks, could potentially receive warrants or preferred equity as an incentive to buy assets above their market value.”

Ah yes, the market value of said loans – the one disconnect for all those claiming that this is an idiosyncratic FRC crisis, not a systemic one (because heaven forbid other banks are mismarking trillions in loans well above market).

“but… but… FRC is idiosyncratic”

Oh is it? Then sell the $173BN in loans at par today, repay the Fed, and have full deposit coverage.

— zerohedge (@zerohedge) April 24, 2023

The reality is that a potential buyer with a healthy balance sheet wouldn’t even need a sweetener: all they need is the ability to weather the current downturn, and then sell the RE-backed loans during the next housing upturn (courtesy of the Fed’s ZIRP), at which point all purchased loans will be well in the money.

The rest of the story is well-known:

The lender is trying to shore up its balance sheet to avoid being seized by the Federal Deposit Insurance Corp. and clear the path for a possible capital raise, the person said. It may need the US government to facilitate negotiations with some of the country’s largest banks to stabilize the lender as it executes its turnaround, the person added. That would be a much cheaper alternative than a failure of the company.

Following yesterday’s earnings, where the investing public focused on the bank’s collapsing deposits while ignoring the potential capital that the $170BN in loans could generated, First Republic fell as much as 30%. Meanwhile, the shorts are piling on and according to S3 Partners, some 33% of the float is now short.

Authored by Simon White, Bloomberg macro strategist,

The prospect of Federal Reserve rate cuts in the near term will be back on the agenda as the debt-ceiling impasse causes a further tightening in financial and credit conditions.

Hot on the heels of the banking crisis is the market’s next preoccupation: the debt ceiling. Until the political gridlock is broken, the US is ineluctably moving toward “X-Day”: the day when the ceiling is reached, all “extraordinary measures” have been exhausted, and the Treasury is no longer able to pay its obligations.

There is never a good time for the US to be at risk of running out of money, but now is especially unwelcome. Credit conditions and velocity were already tightening in the wake of SVB’s bankruptcy. The prospect of a heated political drama that’s set to go to the wire will only accelerate these trends and raise the probability of an early Fed cut, i.e. before the market’s current expectation of December.

Tracking the evolution of reserves, taxes and bank deposits will be crucial to understanding the risks from the looming debt ceiling.

The two main scenarios are:

• More taxes are received than anticipated, which will push back X-Day. However, this will put extra strain on reserves through a drop in bank deposits, where growth has fallen to a 40-year low

• Less taxes are paid than expected and this brings forward X-Day, leaving less time to reach a political solution to raise the ceiling

So far it looks like the latter of these is transpiring, with April non-withholding tax receipts a quarter lower than their five-year average.

The disappointing inflow to the Treasury’s coffers has prompted Goldman Sachs to estimate that X-Day could occur as soon as early June.

June may even prove conservative, given that very weak leading indicators point to tax-revenue growth continuing to fall and potentially soon contracting.

This should mean less pressure on bank deposits and thus reserves – but it may not be enough. Reserves are already very stressed, with their “impulse”, i.e. the change in their change, having just dropped precipitously. This points to weaker equities and tighter financial conditions even without higher-than-expected tax payments.

Worsening liquidity conditions and significant event risk coming ever closer is a decidedly negative set of circumstances.

Yet despite this, there seems to be a general consensus that

a) the debt ceiling will be avoided; and

b) the uncertainty in the run up to X-Day is unlikely to have a notable market impact.

Both views are complacent.

On the first, nobody knows for sure if the US will avoid the debt ceiling becoming binding, but the political parties are further apart than they were in prior debt-ceiling episodes, so it is perhaps wishful thinking there will be an early resolution. And there is a greater – even if it is still small – chance that no agreement at all is reached.

On the second outlook, the economic and financial backdrop is very different today than it was in 2011 and 2013, the last two times the debt ceiling was a live issue:

• Reserves were rising as QE, not QT, was the prevailing Fed policy;

• The RRP facility did not exist in its present form; and

• The Treasury’s account at the Fed (TGA) was on average much lower than it is today.

In 2011 and 2013 we did not get a significant rise in longer-term yields. However, in both cases the Fed was not contracting its balance sheet. Fed reserves were rising in the run-up to the resolution date as the Fed bought Treasuries, unlike today where its portfolio of USTs is contracting.

There is no guarantee longer-term yields will not flare up this time. This would further tighten credit conditions, which are already suffering as primarily smaller banks pull back on lending in the aftermath of SVB’s failure.

Some shorter-term bill yields have already risen to reflect higher default risk. (Although the Treasury would not have to default on bonds, it would have to so on bills given they are issued below par, but paid back at par, leaving a capital mismatch. Bonds are issued and redeemed at par).

This will be a further incentive for money-market funds to use the RRP, which is a drain on reserves and thus velocity.

The RRP currently sits a smidgen below its all-time high at $2.67 trillion and shows no signs of falling. Reserves are also being drained by the TGA, which is rising as taxes are received.

The debt ceiling – coming in the wake of banking stress and a slowing economy – may just be the proverbial straw that breaks the camel’s back. Even if this does not lead to an actual earlier-than-expected rate cut from the Fed, market pricing is likely to soon reflect this likelihood as the political drama heats up. In other words, two-year yields look like they have little upside above 4.20%-4.30%, but plenty of downside.

Update (1305ET):

Ispace has switched to pre-recorded videos on its YouTube live stream due to a communication issue with the spacecraft as it attempted to land on the moon’s surface. The spacecraft’s current status is unknown.

*    *    * 

If all goes to plan, a Japanese lunar lander, which is transporting a rover developed by the United Arab Emirates, is set to touch down on the moon.

Ispace’s Hakuto-R Mission 1 lander was launched atop a SpaceX rocket from Cape Canaveral, Florida, on Dec. 11. Since then, it has been on a three-month journey and just recently entered the moon’s orbit, which lies about 239,000 miles away. 

Earlier statements from ispace outline Hakuto-R is expected to land at “the Atlas Crater, located at 47.5°N, 44.4°E, on the southeastern outer edge of Mare Frigoris (“Sea of Cold”).” 

“Should conditions change, there are three alternative landing sites and depending on the site, the landing date may change. Alternative landing dates, depending on the operational status, are Apr. 26, May 1 and May 3, 2023,” ispace officials said earlier this month. 

On Monday, ispace shared a photo of the lander about 62 miles above the lunar surface. 

We are excited to share a new photo of the Moon taken by the lander’s on-board camera from an altitude of about 100 km above the lunar surface. The photo was taken at 4:32 am on April 15 (JST). (1/2) pic.twitter.com/PWux4GJLIx

— ispace (@ispace_inc) April 24, 2023

Here’s another photo of the lunar surface and the Earth in the distance. 

We’ve received another incredible photo from the camera onboard our Mission 1 lander!

Seen here is the lunar Earthrise during solar eclipse, captured by the lander-mounted camera at an altitude of about 100 km from the lunar surface. (1/2) pic.twitter.com/pNSI4lPnux

— ispace (@ispace_inc) April 24, 2023

According to Space.com, the Hakuto-R lander is expected to land on the lunar surface around 1240 EST (1640 GMT). 

Ispace mapped out the entire mission. 

Live coverage starts around 1100 EST. 

This will be the first attempt at a private moon landing. 

All it took was the collapse of the woke, green Silicon Valley Bank for regulators to begin to ponder how ESG labels may not have exactly been the best way for retail investors to be allocating their capital over the last few years. 

As it turns out, companies can label themselves ESG at will, but some are stunned to find out the label doesn’t actually carry with it the guarantee of acumen on how to run a business or generate any actual cash. Go figure.

This is probably way regulators are finally starting to warn about “greenwashing”, or what the FT referred to this weekend as “using misleading environmental claims to entice well-meaning customers.”

As most already know, the number of ETFs sporting an ESG tag has “more than doubled in the past two years” in London. While some funds are militant and are “designed to be compatible with the Paris Agreement goal of limiting global warming to 1.5C”, others maintain exposure to fossil fuel companies while honing in on other ESG “thematics”, the report says.

This gray area has led to some companies taking advantage of the label. Deborah Fuhr, the founder of ETFGI, a London-based consultancy, told FT: “The speed of product proliferation means that investors have to do their homework with real care to ensure that they choose an ESG ETF that matches their needs and expectations.”

ESG ETF inflows dropped disproportionately compared to the overall drop in the ETF industry’s inflows. The former fell 54.5%, while the latter fell just 33.7%. FT says that political pressure on ESG funds, along with an “increasingly fractious debate over ESG standards”, has started to slow investor demand.

Regulatory standards have shown that “greenwashing was occurring but it remains difficult to say if this was deliberate or unintentional,” according to Amin Rajan, chief executive of the investment consultancy Create Research.

New guidance on what constitutes ESG would be “welcomed by the [fund] industry, although some will likely think this has come too late,” added Raza Naeem, a partner at the law firm Linklaters.

“Some asset managers will be relieved that the Commission has decided against imposing minimum standards, as the onus remains on product providers to determine the level of sustainable investments in each of their funds based on their own methodologies,” Hortense Bioy, global director of sustainability research at the data provider Morningstar, told FT. 

She added: “Some other managers would prefer to have seen minimum requirements, as that would have levelled the playing field and been easier for end-investors. Investors will now have to do more due diligence to understand the methodologies used. Investors may also be confused by the flip-flopping that we are likely to see over fund classification.” 

Rajan concluded: “We are witnessing the birth pangs of a new form of investing which involves big value judgments. The definition of a ‘good company’ varies greatly between different countries and cultures. ESG data disclosures and reporting will improve due to pressure from investors, regulators and company directors who have a fiduciary duty to shareholders.”