As the FedSpeak blackout period begins (and corporate share buyback blackouts accelerate), the markets dealt with a huge options expiration today with notable event risks right ahead in the FOMC with stocks and bond yields surging to end a volatile (holiday-shortened) week.

On the week, rate-trajectory expectations ended marginally lower (dovish) but the last two days have seen Fed jawboning lift the terminal rate and lower rate-cut outlooks…

Source: Bloomberg

US Macro Surprise Index tumbled significantly this week, crushing the ‘soft landing’ narrative…

Source: Bloomberg

On the week, financial conditions ‘tightened’ but remain around as ‘loose’ as they were in June when Fed Funds were 275bps lower…

Source: Bloomberg

With the largest non-quarterly OpEx today, we had a feeling something big was going to happen and stocks screamed higher from the moment the cash markets opened. Nasdaq rallied over 2% today…

Despite today’s surge, stocks ended the week lower (with The Dow back in the red YTD) with Nasdaq the prettiest horse in the glue factory (managing to ramp all the way into the green for the week today) and The Dow dumped over 3% on the week despite today’s melt-up…

After 7 straight days of short-squeeze, ‘most shorted’ stocks reversed on Wednesday and Thursday this week (only to see Friday bring the squeeze back) which left them down modestly on the week…

Source: Bloomberg

Technical levels dominated price action this week with the S&P breaking below its 200DMA and then trading around its 50DMA. Today saw the S&P rally all the way up to its 200DMA perfectly tagging it before stalling…

And Nasdaq flip-flopped between its 50- and 100-DMAs…

The big banks are very mixed since their earnings were announced with Goldman the biggest loser and Morgan Stanley leading the pack…

Source: Bloomberg

Treasuries were dumped for the last two days, erasing the gains from the start of the week and dragging 30Y Yields higher on the week (as the short-end outperformed)

Source: Bloomberg

At the shortest-end of the curve, the T-Bill curve is starting to ‘kink’ around the June/July period in anticipation of the debt-ceiling debacle…

The Dollar ended the week very modestly higher after some noise midweek shifted the greenback out of its narrow range…

Source: Bloomberg

Cryptos rallied this week with Ethereum outperforming Bitcoin (and Solana leading them all)…

Source: Bloomberg

Bitcoin is up for the 16th day of the last 17 days, closing above $22,000, at its highest since September 2022 (above the November pre-FTX-plunge highs)…

Source: Bloomberg

Commodities were broadly higher on the week with Oil, Gold, and Copper all higher while NatGas ended lower after a very noisy week…

Source: Bloomberg

Gold closed the week at its highest since April 2022, finding support at $1900 numerous times…

Oil prices closed the week at their highest since November with WTI above $81…

Source: Bloomberg

Which means brace yourselves for gas prices at the pump to soar again soon

Source: Bloomberg

Finally, we note that global stocks and bonds are moving in sync like never before, thanks to expectations for a Federal Reserve pivot as well as a Chinese economic rebound.

Source: Bloomberg

As Bloomberg notes, the 120-day rolling correlation between the MSCI ACWI Index for world equities and the Bloomberg flagship gauge for bonds has reached the highest in data going back to 1998. The unusual level suggests the correlation could start to wind down, meaning the two asset classes are likely to start moving in opposite directions.

The market appears to be starting to worry about the debt-ceiling debacle as US sovereign credit risk is soaring…

Source: Bloomberg

…and there’s nothing The Fed can (or will) do about that.

Authored by Samantha Flom via The Epoch Times,

Rep. Eric Swalwell (D-Calif.) holds that he did nothing wrong in his associations with a suspected Chinese spy and that House Speaker Kevin McCarthy’s (R-Calif.) vow to remove him from his committee assignments was an act of “political vengeance.”

In December 2020, Axios broke the story that Swalwell had been targeted by a Chinese national and suspected spy named Christine Fang, or “Fang Fang,” between the years of 2011 and 2015, during his rise from an up-and-coming local politician to a U.S. representative.

Recalling his response to that revelation on Jan. 18 on ABC’s “The View,” Swalwell said, “When [the FBI] told me about this, I did everything I hope everyone would do, which was to cooperate and help the FBI, and she was removed.”

Noting that former Speaker John Boehner (R-Ohio) had been briefed on the situation when it occurred and chosen not to act, Swalwell added, “The Washington Post fact-checker gave Kevin McCarthy four Pinocchios for his claims about this … so, it looks to me like political vengeance.”

McCarthy has vowed since November to remove Swalwell from his seats on the Intelligence Committee, Judiciary Committee, and the Committee on Homeland Security, holding that the Democrat poses a security threat for his past relationship with Fang.

“Swalwell can’t get a security clearance in the private sector,” the speaker told the Associated Press on Jan. 9.

“I’m not going to give him a government security clearance.”

However, the specific comment that seems to have drawn Swalwell’s ire is one McCarthy made at a Jan. 12 press conference at the Capitol.

“If you got the briefing I got from the FBI,” the speaker told one reporter, “you wouldn’t have Eric Swalwell on any committee.”

That is the claim that received four “Pinocchios” from The Washington Post, which held that “there is no evidence [Swalwell] did anything wrong” despite McCarthy’s intimation otherwise.

What We Know

According to the Axios report, Fang enrolled as a student at California State University East Bay in 2011, where she began to establish a political platform as president of both the school’s Chinese Student Association and the campus chapter of Asian Pacific Islander American Public Affairs. Using those positions, she began to form off-campus political connections while maintaining “unusually close ties” to the Chinese consulate in San Francisco.

Swalwell reportedly met Fang when he was a Dublin City, California, councilman on the rise, prior to his election to the House of Representatives in 2012.

Christine Fang with then-Dublin City Councilmember Eric Swalwell at an October 2012 student event. (Screenshot/Social media)

By 2014, Fang had formed “close ties” with Swalwell’s office, the report said. She fundraised for his 2014 reelection campaign and helped to get at least one intern placed in his Washington office.

In January 2015, Swalwell was appointed to the House Intelligence Committee, gaining access to some of the most sensitive information available to members of Congress. It was around that time that intelligence officials, alarmed by Fang’s suspicious activity, decided it was necessary to brief Swalwell to avail him of their concerns.

In response, Swalwell cut all ties with Fang, who unexpectedly fled the country later that year amid the investigation.

Other political power players targeted by Fang reportedly include at least two Midwestern mayors with whom she had romantic or sexual relationships.

Experts have warned that such tactics, an espionage method known as “honey trapping,” are commonly employed by the Chinese Communist Party and pose a serious risk for the loss of sensitive information and its use for blackmail.

To date, Swalwell has neither confirmed nor denied the extent of his relationship with Fang.

Other Removals

In addition to Swalwell, McCarthy has also pledged to remove Reps. Adam Schiff (D-Calif.) and Ilhan Ohmar (D-Minn.) from their committee assignments.

In the last Congress, Schiff chaired the House Intelligence Committee and was a member of the controversial Jan. 6 Committee, while Omar sat on the Foreign Affairs Committee and the Education and Labor Committee.

“Schiff has lied to the American public,” McCarthy told the Associated Press last week “He should not be on Intel.”

McCarthy did not elaborate on which alleged lies he was referring to, though Schiff was criticized last year for presenting a doctored text message as evidence before the Jan. 6 Committee.

In 2017, Schiff also heavily promoted the authenticity of the Steele dossier, claiming to have seen “more than circumstantial evidence” that the Trump campaign colluded with Russia to steal the 2016 presidential election.

The contents of the dossier have since been debunked.

In a Nov. 19 tweet, McCarthy also explained his reasoning on Omar.

“Last year, I promised that when I became Speaker, I would remove Rep. Ilhan Omar from the House Foreign Affairs Committee, based on her repeated anti-semitic and anti-American remarks,” he wrote.

“I’m keeping that promise.”

Technically, McCarthy does not have the power to unilaterally strip members of their committee assignments. Instead, a majority of the full House must approve such a move. Therefore McCarthy would need the support of all but a handful of his caucus to remove the three Democratic representatives.

Both Omar and Schiff have pushed back on those decisions, with Omar attributing them to Republicans’ alleged “mission to use fear, xenophobia, Islamophobia and racism to target me on the House Floor and through millions of dollars of campaign ads.”

“McCarthy’s effort to repeatedly single me out for scorn and hatred—including threatening to strip me from my committee—does nothing to address the issues our constituents deal with,” she added.

“It does nothing to address inflation, healthcare, or solve the climate crisis.”

Schiff, on the other hand, called McCarthy a “very weak leader” of the Republican caucus, holding, “He will adhere to the wishes of the lowest common denominator, and if that lowest common denominator wants to remove people from committees, that’s what they’ll do.”

The Epoch Times has reached out to Speaker McCarthy’s office for comment.

A federal judge ruled Boeing must appear in a Texas courthouse next week to be arraigned on federal criminal charges in the deaths of the 346 people killed in two Max plane crashes in 2018 and 2019. 

“Initially, Boeing was granted immunity from the U.S. Department of Justice as part of a $2.5 billion deferred prosecution agreement entered into in January 2021 regarding fraud involving the flawed design of the MAX aircraft that was never revealed to the proper authorities and officials before it was allowed to fly in the skies,” the Clifford Law Office, representing some of the victims’ family members wrote in a statement. 

In Thursday’s ruling, U.S. District Judge Reed O’Connor of the Northern District of Texas, located in Fort Worth, stated Boeing must appear in court on Jan. 26 for an arraignment because the victims’ families were excluded from the initial process. He ruled under the Crime Victims’ Rights Act, which they should’ve been. 

“It is rare in U.S. aviation law history that a corporation is arraigned on criminal charges regarding the deaths of plane crash victims,” Clifford Law Office stated. 

Another lawyer and University of Utah law professor, Paul G. Cassell, also representing families of those killed in the two crashes, told The Washington Post that O’Connor’s ruling “is a real blow in favor of evenhanded justice.” 

The Justice Department said in 2021, “misleading statements, half-truths, and omissions communicated by Boeing employees to the (Federal Aviation Administration) impeded the government’s ability to ensure the safety of the flying public.”

“We are glad they will be actually brought to an open court” to face the charge, Michael Stumo, whose daughter was killed on the plane in Ethiopia, told WaPo. He said he wants to see Boeing executives prosecuted:

 “I am also happy that we and other victims’ family members will be able to finally address the court on what Boeing’s criminal conspiracy to defraud the FAA and cause the death of hundreds, including my daughter Samya Rose Stumo, cost us,” Stumo said.

Judgment day is coming for Boeing execs. 

Authored by Jack Phillips via The Epoch Times (emphasis ours),

A doctor who appeared prominently in the media during the pandemic acknowledged this week the United States is “overcounting” COVID-19 deaths and stressed the need for “transparent reporting” on the real numbers.

Leana Wen, a former Planned Parenthood director who now works for CNN and the Washington Post, told the channel that natural immunity and vaccinations have reduced severe COVID-19 cases since the start of the pandemic.

“Hospitals are still routinely testing everyone who’s getting admitted for COVID,” Wen, also a former director of the Baltimore City Health Department, said in response to a question about whether her statements could be “fodder for conspiracy theorists.”

“We’re seeing many people who are hospitalized with COVID, and I think it’s important to separate out who is being hospitalized because of it,” Wen added. “Because there are a lot of people who are still very concerned about their risk from COVID and we need to give them the most accurate data possible so that they can better gauge their risks. There are people still not resuming indoor dining or going to the gym or socializing. We have to give them the most accurate reporting as possible.”

In a Washington Post opinion piece, Wen noted that current Centers for Disease Control and Prevention (CDC) data show that about 400 people are dying from the virus every day. She then asked a question that many others have asked over the past three years: “But are these Americans dying from COVID or with COVID?”

“Two infectious-disease experts I spoke with believe that the number of deaths attributed to COVID is far greater than the actual number of people dying from COVID,” she wrote. “Robin Dretler, an attending physician at Emory Decatur Hospital and the former president of Georgia’s chapter of Infectious Diseases Society of America, estimates that at his hospital, 90 percent of patients diagnosed with COVID are actually in the hospital for some other illness.”

Some patients have several concurrent infections, not just COVID-19.

“People who have very low white blood cell counts from chemotherapy might be admitted because of bacterial pneumonia or foot gangrene,” Dretler was quoted as saying. “They may also have COVID, but COVID is not the main reason why they’re so sick.”

‘With COVID’?

But if those patients die, the doctor said that COVID-19 may get added to their death certificates—meaning, they’re counted as a COVID-19 death. That’s despite COVID-19 not being the primary factor that caused the deaths.

Notably, several Northern California counties in mid-2021 changed how they counted COVID-19 deaths. In one county, the death figure dropped by 22 percent, while in another, 400 fewer deaths were reported following the changes.

Months before that, an article published by the Association of American Medical Colleges noted that counting COVID-19 deaths is “complicated” and provided an example. An elderly man in Atlanta was stricken with advanced cancer in early 2021, later contracting COVID-19 before ultimately passing away.

“Given his already fragile state, his condition quickly took a turn for the worse” and he later died, a doctor said. Despite having advanced cancer, medical officials listed his death as caused by COVID-19.

Read more here…

The Washington Post revealed in a bombshell Thursday evening report that CIA Director William Burns made a secret trip to Ukraine’s capital last week to give a personal briefing to President Volodymyr Zelensky on what can be expected from Russian military strategy and Putin’s likely vision for the war in the weeks and months ahead.

“Director Burns traveled to Kyiv where he met with Ukrainian intelligence counterparts as well as President Zelensky and reinforced our continued support for Ukraine in its defense against Russian aggression,” one US official confirmed to the Post.

While in prior months, particularly the summer, it might have been expected that such a high level trip by the head of America’s top intelligence agency to Kiev might have had as top of the agenda discussion of ways forward for negotiated peace, increasingly Washington is talking a “win” – or at least enough clear battlefield leverage for Ukraine to come away with victory at a future negotiating table. Part of this is the current push to get heavier US and NATO weaponry to Ukraine as fast as possible.

Crucially, there’s no mention in WaPo’s coverage of the Burns trip that opening a pathway for ceasefire talks was at all a point of discussion with Zelensky. This as the bloody battle for Bakhmut reportedly is resulting in immense casualties for both sides.

Instead, “Top of mind for Zelensky and his senior intelligence officials during the meeting was how long Ukraine could expect U.S. and Western assistance to continue following Republicans’ takeover of the House and a drop-off in support of Ukraine aid among parts of the U.S. electorate, said people familiar with the meeting,” the Post writes. And importantly:

“Burns emphasized the urgency of the moment on the battlefield and acknowledged that at some point assistance would be harder to come by, the people said.”

Currently the Biden administration is finalizing another some $2.6 billion in military aid to Ukraine. Though it will include a reported 100 Stryker combat vehicles and at least 50 Bradley Fighting Vehicles, the US is expected to continue refusing to send M1 Abrams tanks.

On Wednesday the White House’s undersecretary of defense for policy Colin Kahl presented this as based on specific battlefield strategy. “What we’re trying to look at is the mix of armored and mechanized forces that make sense,” he said, explaining that “The Russians are really digging in. …They’re digging trenches, they’re putting in these dragon’s teeth, laying mines. They’re really trying to fortify that that FLOT, that forward line of troops.” Kahl continued.

“To enable the Ukrainians to break through given Russian defenses, the emphasis has been shifted to enabling them to combine fire and maneuver in a way that will prove to be more effective,” Kahl added.

One possible reason for the sudden rush of heavier weaponry to #Ukraine: “Burns emphasised the urgency of the moment on the battlefield and acknowledged that at some point assistance would be harder to come by” https://t.co/XquLjITu6t

— Anton La Guardia (@AntonLaGuardia) January 20, 2023

Likely, Burns’ briefing to the Ukrainians emphasized this. As for the reference to Burns reportedly informing Zelensky that at some point assistance would be harder to come by, this suggests the US still doesn’t see Ukraine’s path forward as one of an outright military “win” involving the regaining of all pre-Feb.24 territory, but instead would reflect something more like what the CIA director said in a PBS interview last month…

“Most conflicts end in negotiations, but that requires a seriousness on the part of the Russians in this instance that I don’t think we see,” Burns said at the time. “At least, it’s not our assessment that the Russians are serious at this point about a real negotiation.” Thus for the time being it’s all about battlefield leverage to gain the most spoils whenever that final negotiated settlement does come. But then again the ‘alternative’ is a major great power war, which the world may already be witnessing the beginnings of.

Authored by Jonathan Turley,

President Joe Biden has something that he wants the public to know.

After the discovery of highly classified material in Biden’s former office, his garage and library, the President wanted to make one thing (and only one thing) perfectly clear: “I have no regrets.”

It was a moment that rivaled his disastrous observation that, while classified material was found in his garage, it is a locked garage that also housed his beloved 1967 Chevrolet Corvette Stingray.

While Biden’s “corvette standard” for storing classified documents was baffling, his declaration of “no regrets” is downright infuriating.  It is also remarkably moronic with a special counsel in the field. Either the President believes that Special Counsel Robert K. Hur will paper over the entire affair or he is doing his best to force his hand with a criminal charge.

Biden was miffed to be even asked about the matter after stonewalling the press for days. He ventured out of his White House bunker to tour storm damage in California and used the victims as a virtual human shield: “You know what, quite frankly, bugs me is that we have a serious problem here we’re talking about. We’re talking about what’s going on. And the American people don’t quite understand why you don’t ask me questions about that.”

The problem is that recent polls show that, while the President has no regrets, the public overwhelmingly does. Most citizens view his conduct as negligent. Roughly two-thirds believe that Congress should investigate the President, including a majority of Democrats. Sixty percent believe that he acted inappropriately with classified material.

Nevertheless, after days of hunkering down with this aides and polls, Biden decided to stick with total and absolute denial of regret or responsibility. It was not a surprise for many of us who have following Biden and his family through the years.

I wrote at the start of this scandal that Biden’s “silence” is hardly surprising. Biden has always been better at expressing revulsion than responsibility. Time and again, he has literally rushed before cameras to denounce others, often without basis, for alleged crimes. He has not waited for investigations, let alone trials.” When it has come to his own alleged misconduct, Biden will deflect, deny, but rarely declare responsibility.

The comments on Thursday were classic Biden. He first deflected by using the California victims. He then denied any real responsibility. Despite the appointment of a special counsel to investigate his conduct, he shrugged off the entire matter as something akin to finding a neighbor’s borrowed hammer from 2017 in his garage:

“We found a handful of documents were filed in the wrong place. We immediately turned them over to the Archives and the Justice Department …I think you’re going to find there’s nothing there. I have no regrets. I’m following what the lawyers have told me they want me to do. It’s exactly what we’re doing. There’s no there there.” 

Of course, there is also a special counsel “there.”

Indeed, it is never a good idea to go public with expressions of no regret when you are being investigated on whether you took classification laws seriously. The statement was right out of the Alex Baldwin School of Criminal Defense in claiming that the gun did it. Fortunately, the President is not (yet) saying that the Corvette did it.

Since the standard is gross mishandling of classified evidence, the last thing you want to do is convey a grossly negligent attitude toward the discovery of highly classified material in your various private spaces. The President even added that he is “looking forward to getting this resolved quickly.” That quick resolution is less likely when you are telling the special counsel that this is no big deal. That is precisely the type of attitude that leads to classified material being stored with your corvette.

It is hard to imagine how Biden’s legal and political team would come up with this as the best approach when the President finally broke his silence. There is a difference between denying and dismissing an alleged crime. As a criminal defense attorney, I would be mortified by a client publicly dismissing the seriousness of a potential crime while he is under investigation. For most defendants, it would constitute “bearding the lion” and prosecutors would not take kindly to the approach.

Of course, the President could be counting on his prior declaration that “no one f**ks with a Biden.” However, he may be saying the quiet part out loud and putting Hur in an early and uncomfortable position. There is a “there there.” It is classified evidence in places like a garage. By stating that this is likely to wrap up quickly, Biden is not only showing little appreciation for the seriousness of the alleged crime but the seriousness of the investigation. He is not only making Hur look like a stooge or cipher. He is making Baldwin look like a comparative genius.

It’s been an ugly week for Goldman Sachs shareholders (big revenue, eps miss, loan loss provisions soared) and employees (biggest round of layoffs ever announced); but, if The Wall Street Journal is right, things just got a lot worse.

According to people familiar with the matter, The Fed is probing Goldman’s consumer business to determine whether the bank had appropriate safeguards in place as it ramped-up lending.

WSJ reports that the regulator has concerns that the bank didn’t have proper monitoring and control systems inside the consumer business, known as Marcus, especially as it grew larger

The probe reportedly grew out of a standard Fed review of Goldman’s consumer business, which started in 2021, people familiar with the matter said.

It intensified to an investigation last year, they said.

This should not be a surprise to ZeroHedge readers as we detailed in September that how Goldman Sachs had switched from betting against Subprime (Residential Mortgage Backed Securities and their various synthetic and “squared” derivatives) to betting with Subprime (hoping to profit off America’s sub-660 FICO population by lending to it).

Goldman’s credit card business, anchored by the Apple Card since 2019, has arguably been the company’s biggest success yet in terms of gaining retail lending scale, but rising losses threaten to mar that picture.

But now, post the COVID money-drop and various moratoria on payments/bankruptcies/delinquencies, the fecal matter appears to be starting to strike the rotating object as JPMorgan note points out that while competitors like Bank of America enjoy repayment rates at or near record levels, Goldman’s loss rate on credit card loans hit 2.93% in the second quarter.

That’s the worst among big U.S. card issuers and “well above subprime lenders,” according to JPM analyst Vivek Juneja.

Even more notably, Goldman’s losses are also higher than that of Capital One, the largest subprime player among big banks, which had a 2.26% charge-off rate.

“If there’s one thing Goldman is supposed to be good at, its risk management,” said Jason Mikula, a former Goldman employee who now consults for the industry.  

“So how do they have charge-off rates comparable to a subprime portfolio?”

None of that should come as a surprise though since, as the FT reported in 2018 citing analysts, Goldman has been targeting riskier borrowers, supplying about one-fifth of its loans to people with credit scores below 660 on the commonly used FICO scale; there is a familiar name for this group of borrowers: “subprime.”

And now, four years later, as CNBC reports, more than a quarter of Goldman’s card loans have gone to customers with FICO scores below 660, according to filings. That could expose the bank to higher losses if the economy experiences a downturn, as is expected by many forecasters.

“People are losing their jobs and you had inflation at 40-year highs; that will impact the subprime cohort more because they are living paycheck to paycheck,” Michael Taiano, a senior director at Fitch Ratings, said in an interview.

“With Goldman the question will be, were they growing too fast into a late-cycle period?”

Savings rates are collapsing, forcing Americans to use their credit cards to maintain living standards as prices for everything soar…

“Goldman’s credit card net change-off ratio has risen sharply in the past 3 quarters,” Juneja wrote.

The Fed investigation is occurring at the same time as a Consumer Financial Protection Bureau probe of Goldman’s credit-card business. Goldman disclosed last summer that the CFPB is investigating its credit-card account management practices, including how the bank resolves bill errors, refunds cardholders and advertises its cards.

The two agencies are sharing information, people familiar with the matter said.

In 2018, quoted by the FT, CEO at the time, Lloyd Blankfein said Goldman was “being very careful” in its development of Marcus, “growing very slowly and deliberately with a lot of controls”, so that people do not take out loans they cannot afford to pay back.

It appears that all went out the window as ‘stimmies’ sparked a panicked rush for customers… and remember we are still ‘not in a recession’ and Americans are enjoying what Biden proclaimed “the strongest economy ever.”

Or maybe this surge in charge-offs at Goldman is the canary in the ‘consumers are strong’ coalmine.

Goldman shares are tumbling on the report, now below the spike lows from earnings this week…

As we noted earlier in the week, Goldman is now scaling back the consumer operation as part of a broader reshuffling of its businesses.

The bank is discontinuing personal loans and has scrapped plans to offer a checking account broadly.

“We tried to do too much too quickly,” Chief Executive David Solomon said of the consumer business on a call with analysts earlier this week.

Submitted by QTR’s Fringe Finance

Among the many wretched, slimy and odious things that are increasingly giving me the creeps as the sands of my life’s hourglass continue to fall is the World Economic Forum: a collective of self-righteous global elites handing down virtues, values, lessons, lectures and political initiatives to us peons out here in the rest of the world.

The “Forum” is increasingly starting to resemble a globalist government, stocked with globally unelected turbo-douchebags, who have been assembling quietly in the background while no one has noticed.

One minute you’ve never heard of them – did you know the WEF has been around for about 5 decades? – the next, the “Forum” is harboring incredible influence, mostly with “useful” bureaucratic idiots on the left who are happy to take their cues on how to napalm individual rights for betterment of advancing their agendas from anyone who will help, regardless of their motivation.

WEF Founder Klaus Schwab, either giving or receiving some bullshit “Global Citizen Award”, which no normal person has ever heard of or cared about.

That’s right: gone are the days of joking about The Great Reset, owning nothing and liking it and shifting to a diet of mealworms and crickets.

I’ve arrived at a point past that – a point of being sickened by watching people that in no way, shape or form represent me or the people in my life, yammer on about what my future will or won’t look like and what things I stand for are “right” or “wrong”.

It’s right in the WEF’s mission statement:

The World Economic Forum is an independent international organization committed to improving the state of the world by engaging business, political, academic and other leaders of society to shape global, regional and industry agendas.

The truth is no matter how much each narcissistic and likely psychotic guest would love to speak on behalf of millions, or even billions of people, they simply don’t.

I don’t expect these people to understand the consequences of painting with a broad brush, nor do I think they care about them. Take the Covid vaccines as an example. Isn’t the idea of jabbing every single person on Earth, regardless of age, health status and lifestyle (lest we forget whether or not they consent to it) wildly reckless?

Of course it is. But it doesn’t matter – because someone wanted it to be done…and, with that, it was put into action.

Source: NY Times

Wild, right? This unilateral implementation of mandates during Covid, regardless of what the individual may want for themselves and their families, was authoritarian catnip to the dingleberries that assemble at the World Economic Forum every year. I’m certain it has enabled many participants to think: we did it with vaccines – we cut them off from travel, we put their jobs and their livelihoods on the line and we even arrested and jailed them – now we can do it with anything else.

I don’t need to be in Davos this week to understand how little I have in common with the people of the World Economic Forum. I know this because I was recently in Washington DC during the International Monetary Fund’s most recent circle jerk world conference.

Anybody that thinks that these are gatherings of people who live like them and represent them are sorely mistaken: I’ve never seen so many Rolexes, Bentleys, hundred thousand dollar outfits and, most importantly, armed security, as I saw within the 10 square block radius of the IMF that week.

It was a festival of global “ambassadors” that collectively looked like an amalgam of every corrupt Bond villain you’ve ever seen.

With that in mind, let’s have a look at what high quality ideas the Forum…has put forth this year to “shape global, regional and industry agendas”.

Everybody knows that fear is the best way to get people to listen up and do what you say (see: vaccinations, Covid, Fauci et. al pgs. 1-∞). With that being said, the Forum led off with some lighthearted banter, including the proclamation that “we are now facing…mass extinction” and “humanity’s future is at risk.”

NOW – World Economic Forum declares a “planetary” and “justice” crisis. pic.twitter.com/4utL3VmiIW

— Disclose.tv (@disclosetv) January 18, 2023

Well holy f*ck – why didn’t you say so? Man, I better listen up to the WEF’s prescription for exactly how to fix this, because “mass extinction” is nowhere on my 2023 day planner…plus I have a dentist appointment in several weeks that I need to make.

One man that definitely did get the “fear” memo – and judging by his temperament also had cattle prods stuck up his ass and turned onto their highest voltage setting – was Al Gore.

The man who incorrectly predicted the Artic would be completely ice-free by now took his time at the WEF to do his best Keith Olbermann impression by yelling at the top of his lungs and panting for breath about social causes, like climate change.

Al also politely reminded us that we are not obeying quick enough for his liking:

“We have to act! So in answer to your question I would say we have to have a sense of urgency much greater than we have yet had…and we need have had…and we need to make some changes!”

Here’s Al Gore talking at the WEF in Davos yesterday about the coming wave of “one billion climate refugees” that will cause Western nations to “lose our capacity for self-governance”. He says this as if it’s a bad thing and not exactly what globalists like himself want. 👇 pic.twitter.com/olCGeXDO6s

— RAW EGG NATIONALIST (@Babygravy9) January 19, 2023

“We’re still putting 162 million tons [of greenhouse gas] into it every single day and the accumulated amount is now trapping as much extra heat as would be released by 600,000 Hiroshima-class atomic bombs exploding every single day on the earth,” he continued. “That’s what’s boiling the oceans, creating these atmospheric rivers, and the rain bombs, and sucking the moisture out of the land, and creating the droughts, and melting the ice and raising the sea level, and causing these waves of climate refugees!”

Holy f*ck..rain bombs?! Why didn’t you say so? Man, I better listen up to the WEF’s prescription for exactly how to fix this, too.

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Meanwhile sitting next to Al and on the receiving end of his spittle while he was screaming was Colombian President Gustavo Francisco Petro Urrego.

Gusto dug deep into the complex web of his mind to contribute the 4D-chess-like suggestion that capitalism as it stands today is going to irrevocably doom humanity because it created climate change.

F*ck again. Can’t we do anything right?

Ergo, his nuanced solution is to take away capitalism completely and, poof, there goes the global warming problem with it. Here’s his rock solid logic:

“[We] talk about policy and politically correct discourses when we know that the statistics mean that we are reaching a point of no return?” he said. “The capitalism that we know nowadays has a driving force and logic, and that is to increase our profits in such a way, and that’s how we talk about history to regulate everything without political or social boundaries. That’s the one we have. This has resulted in some sort of global anarchy.”

“We have to put an end to this if we wish to live in our planet. Can our capitalism do this? Based on the current data, we won’t be able to do so. Therefore, perhaps we should do the following reflection: If capitalism is unable to do so either humanity will die with it, or humanity will overcome capitalism so that we can live in our planet.”

Colombian Pres. Urrego at #wef23: “Capitalism helped create” global warming and our state of “global anarchy”

“Humanity must overcome capitalism in order that we can live in our planet” pic.twitter.com/Btk0TWNpIc

— Tom Elliott (@tomselliott) January 18, 2023

And then of course, over on the Vans Dorked Tour side stage was a panel called “The Clear and Present Danger of Disinformation”, ironically run by a recently fired journalist whose show, also ironically called Reliable Sources was, also also ironically kicked off cable television for what I’m guessing was a lethal combination of getting almost everything wrong and sucking ass in general.

That journalist, Brian Stelter, interviewed European Commission VP Věra Jourová, who I guarantee you’ve never heard of before reading her name today. But that isn’t going to stop her from making the case for telling you that your free speech should not only be taken from you, but also turned into a criminal offense when used to state unpopular opinions.

She told disinformation-hall-monitor Stelter: “We need the people who understand the language and the case law in the country because what qualifies as hate speech — illegal hate speech, which you will have soon also in the U.S…I think that we have a strong reason why we have this in the criminal law.”

Pay special attention the burning look of genuine concern on Stelter’s face.

European Commission VP Věra Jourová at the WEF cackling as she announces, Brian Stelter nodding along:

“Illegal hate speech, which you will have soon also in the U.S. I think that we have a strong reason why we have this in the criminal law.”

Who decides “Hate speech”? pic.twitter.com/1lBwV4Rdzl

— SOS-UK-Report (@sosReports) January 19, 2023

And this isn’t new, but last year the theme was the same – “recalibrating” what you can and can’t say. Of course, “approved” speech guidelines will be handed down not by God and not from your country or state’s constitution – but from a dozen Marxists, eager to tow the globalist initiative’s line in any way they can. After all, they’re God now. They’re the constitution now.

You may remember Julie Grant, the Australian eSafety commissioner, from this viral World Economic Forum clip last year in which she proposed a ‘recalibration’ of free speech. pic.twitter.com/DrtirwoVeh

— Michael Knowles (@michaeljknowles) January 18, 2023

On a forthcoming podcast with Chris DeMuth, Jr., I raise the idea that, regardless of your ideology or politics, people in general are getting sick of being involuntarily deputized to participate in social causes, no matter what they may be.

Just because I work for a certain corporation, use certain products, or shop at certain stores does not mean that I align myself with the politics and ideologies of those people, places and things – end of story. This is why I find it offensive when I walk into a Whole Foods and see a sign that says some bullshit like “Hate Has No Home Here” hung up over the entrance where everyone walks in.

I’m socially liberal and I want people to live their lives however they would like without infringing on the rights of others. I don’t need a sign at a grocery store to tell me that. In fact, it’s demeaning and insulting.

Along the same lines, I’m a citizen of the world – but I don’t need a world forum to speak for me or involuntarily deputize me in whatever ideological or social justice cause they deem important. What’s best for one person isn’t necessarily what’s best for the next, and the arrogance of a “select group of human beings” thinking they can speak and act for everyone under the manufactured guise of “saving the planet” and doing what’s best for everyone tells you everything you need to know about these sociopaths.

But don’t tell John Kerry that – he’s almost anointed himself as an extraterrestrial deity. Here he is sounding like a card-carrying member of L. Ron Hubbard’s Sea Org.

John Kerry says, “we select group of human beings” are talking about “saving the planet” at the World Economic Forum.

“It’s so almost extraterrestrial,” Kerry added. pic.twitter.com/kE8IxtJDFj

— 𝚁𝙰𝙶𝙴 𝙰𝙶𝙰𝙸𝙽𝚂𝚃 𝚃𝙷𝙴 𝚅𝙰𝙲𝙲𝙸𝙽𝙴 (@72powpow) January 18, 2023

And finally, you all know this already, but the hypocrisy is blinding.

The same people railing about climate change flew there in private jets. When they get home, they drive EVs stocked with battery metals mined by children in Africa. They wear shoes, shirts and pants made in sweatshops. They use iPhones made by workers in China undergoing horrific working conditions. They use petroleum products every day. They rail about inequality but support removing individual rights, traceable digital currencies, social credit scores and a central banking system that systematically widens the inequality gap.

The private airport at Davos is packed.

Elites park their private jets, then fly their helicopters to the World Economic Forum to talk about climate policy. pic.twitter.com/gjMVgJtWQA

— Citizen Free Press (@CitizenFreePres) January 18, 2023

Yes, the same people that claim to work for the every day Earthling’s better existence live in social tiers that you, I and our friends will never be a part of and would never want to be a part of.

Because while we may use those same iPhones and that same petroleum, we don’t stand in the meadow and spray on about how virtuous we are. We try to do the things we know to be right in our hearts, and we know we’re doing the best we can with what we have. That’s enough fulfillment for many of us. We don’t need to anoint ourselves.

In the end, what does that mean? It means if the World Economic Forum is really looking for new, novel and fresh ideas that’ll help out the everyday citizen of Earth – maybe they should try simply leaving us the f*ck alone.

—

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By now everyone, of course, knows that the Fed has broken what was once called “the market” beyond repair. Add to that zero liquidity, a still healthy army of HFT bots and the explosion in 0DTE option trading…

… and what you have is a market that looks like this on a daily basis.

Nowhere is this brutal swing more visible than in the furious ebb and flow of shorting and squeezing activity. 

After the massive pile up of shorts in late December, when tax loss selling was accompanied by rapid and aggressive degrossing and shorting by hedge funds, it didn’t take long for the squeeze to steamroll the fast money just as fast.

As a reminder, last Monday, we showed the latest JPM prime brokerage data which revealed that “high SI stocks in the US have seen a ~6 week period of persistent short additions. The magnitude and duration of these short additions is on par with the largest we’ve seen in past years and the cumulative additions put shorts in these types of stocks back at multi-year highs.”

This striking observation of near-record shorting by hedge funds, prompted JPM to muse that “given the consensus bearish view of Equity markets, driven by expectations for the Fed to hike us into a recession, a sharp squeeze would catch a number of investors offsides” and conclude that “we are setting up for a tech-led squeeze higher as shorting gets extreme.”

Indeed, that’s precisely what happened next and as shown in the chart below, the Goldman most shorted basket erupted almost 20% higher in just the past week.

Of course, the squeeze didn’t last long – it rarely does unless the Fed is also lifting offers – and as we reported yesterday citing Goldman’s Prime Brokerage, “while US Single Stock shorts have been net covered for 6 straight sessions on the Prime book, Macro Products (Index and ETF combined) saw renewed shorting activity on Friday and Tuesday.”

Additionally Goldman estimates “suggest the performance of Systematic L/S and Multi-Manager Platforms, both of which were more challenged in the past two weeks and likely contributed to the recent risk unwinds, have stabilized in the past few sessions.”

Underscoring this dynamic, Goldman trader Michael Nocerino declared that the “short cover bid is now gone… Yesterday the cover bid that was present for the first 2+ weeks of 2023 got pulled out from underneath us. Our Most Short Basket {GSCBMSAL Index} traded 3% lower but is still up 12% on the year…watch for this basket (and the rest of lower quality) to move lower today w/ some negative developments post yesterday’s close.“

So if you are not getting squeezed, what do you do? Why you re-short of course until the next positive catalyst jerks the market higher and the next squeeze begins again. Sure enough, this is what happened: as Goldman’s John Flood describes yesterday’s action, there was “somber tone all session with negative CTA momentum, broken technical, hawkish ECB and dicey earnings (PG and AA focal points here). We saw L/O supply in consumer staples on heels of PG miss. HF cover bid vanished today and lowest quality pockets of the markets trended sharply lower.”

Translation: after a squeeze sent the most shorted names up the most in years, they are being reshorted again and are tumbling, to wit: 

Renewables (GSXURNEW) -389bps, Non Profitable Tech (GSXUNPTC) -362bps, Most Short (GSCBMSAL) -274bps and High Retail Sentiment (GSCBHRSB) -265bps.

And the punchline: “Overall executed flow across GS equities franchise had -847bp sell skew vs 30d avg of -175bps (79th percentile on 1 yr look back). Info Tech -24% sell skew fell in 92nd percentile on 1 yr look back. L/Os ended with a 9% sell skew vs 30d avg of a -2% sell skew.” And yes, even ‘comeback kid’ Netflix was aggressively sold “we saw HF long selling in NFLX post close (9 out of 10 in terms of crowded long here).“

What happens next? Depends on whether the pile up in shorts can accelerate momentum to the downside. They won’t get much help from CTAs which remain largely bearishly positioned, and only a sharp puke from here can get them to pile in. On the other hand, should the S&P rebound back over 3965, or the MT CTA trigger, trend-followers will resume buying at which point the shorts will once again scatter.

One can also argue that spoos don’t even have to rise that high: if they can defend the 50DMA at 3923, the downside momentum will be broken, and the next squeeze will start and slowdown as it hits the now infamous descending channel resistance which will be just below 4,000 on the next cycle. At that point it will be up to the bulls: will they fail to “rise above” for the 7th consecutive time…

… or will they finally breach resistance opening up the path to 4,200, if purely based on technicals.

Shares sales made by Tesla CEO Elon Musk prior to the company missing its delivery forecasts have come into focus thanks to a new Wall Street Journal article that pointed out some…anomalies…about the timing of Musk’s recent sales. 

Musk sold $3.6 billion in stock late last year after questions loomed about whether or not the company would make its Q4 delivery numbers. And while newsmedia speculated that the number could come in below consensus, the company did nothing to update investors about where they stood relative to their guidance.

Which, as the WSJ points out, begs the question: “Did Mr. Musk know that business had slowed when he sold his shares?”

James Cox, a securities-law professor at Duke University commented to the Journal: “This should be of great interest to the SEC. The issue here is, what did he know and what was the market anticipating when he sold? That’s a critical moment.”

SEC rules obviously prohibit insiders from trading when they are in possession of material non-public information. There are exception to this rule, like when insiders use a 10b5-1 plan to sell or buy at steady intervals. 

Meanwhile Tesla had cut prices in china on December 1, prior to Musk’s sales, indicating the company may have known there was a demand problem. Similarly, on December 5, the company announced plans to lower production in China. 

Musk’s sales came December 12 to December 14 at an average price of $163 per share, the report notes. Those shares had lost about $1.2 billion in value when the company’s stock closed at $108 on January 3 – after the company missed its delivery guidance. 

About 8-10 days after Musk’s sales, Tesla also lowered prices in the U.S. and started to offer 10,000 miles of free supercharging for vehicles delivered that month – indicating the company may have been on a concerted push to pull forward more deliveries for its Q4 number. 

The company had previously guided for a 45% increase in annual deliveries, which would have equated to about 449,000 deliveries for the quarter. In early 2023, it reported deliveries of just 405,278 vehicles, missing estimates by almost 10%. 

Musk has now sold more than $39 billion of Tesla since November 2021, the report says. His share sales most recently have ostensibly come as Musk seeks to create liquidity after his $44 billion purchase of Twitter. 

Whether the SEC gets involved remains to be seen. Donald Langevoort, a securities-law professor at Georgetown University concluded: “Is it suspicious? Yes. Is it entirely possible there are other explanations? Of course. But that’s what the enforcement process is all about.”