It’s not just tech giants and Wall Street firms any more. As FreightWaves reports, truck brokerage giant C.H. Robinson Worldwide Inc. is laying off between 1,000 and 1,200 employees, most of whom are at the vice president and general manager level, according to sources familiar with the situation. The move, as FreightWaves CEO Craig Fuller reports, “might be the largest layoff in the history of freight brokerages, not related to a bankruptcy or acquisition.“

This might be the largest layoff in the history of freight brokerages, not related to a bankruptcy or acquisition. https://t.co/NVfB20nMor

— Craig Fuller 🛩🚛🚂⚓️ (@FreightAlley) November 9, 2022

The move comes a week after the Eden Prairie, Minnesota-based company reported weaker-than-expected, third-quarter results and strongly hinted at impending labor cost reductions to combat the impact of slowing demand and increased costs.

“We got ahead of ourselves in terms of head count,” said Bob Biesterfeld, Robinson’s president and CEO, on a post-earnings call. Robinson employs nearly 17,000 people.

Biesterfeld said he did not forecast truckload demand declining as rapidly as it did, as well as spot market and contract rates deflating considerably.

In a statement Wednesday night, the company would not confirm the number of layoffs and disputed the number cited by sources, adding:

“As we said last week in our Q3 earnings, changes in market conditions, coupled with many successful endeavors on our digital roadmap directed at scaling our model to be more efficient, mean we are in a position to reduce our overall cost structure.

“As a result, we’re eliminating some positions at C.H. Robinson. These are not easy decisions, because we recognize the significant contribution of the impacted employees. We have tried to approach this with as much respect and empathy for our former colleagues as possible and are providing transition assistance.”

In late February, Robinson entered into a cooperation agreement with Ancora Holdings Group LLC, an activist investor group. It also named Henry Maier, a former CEO of FedEx Ground, the U.S. ground delivery unit of FedEx Corp., (NYSE: FDX) and Jay Winship, a financial executive, as independent directors.

In addition, Robinson’s board formed a four-member capital allocation and planning committee, which the company said would recommend capital allocation, operations and strategies, including enhanced transparency and disclosures to shareholders. The panel is chaired by Winship and initially includes Scott Anderson, the company’s chairman, as well as Biesterfeld and Maier.

Authored by Simon White, Bloomberg macro strategist,

The longed-for Fed pivot may come quicker than expected — especially after this week’s very soft inflation data — but equities still face more downside if hopes for easier monetary conditions clash with the rising risk of a recession.

The Fed’s battle with inflation this year has pitched the stock market into one its most bearish cycles in decades. The expectation — or hope — is that once the Fed takes its foot off the brake, stocks will cast off their shackles and new a bull market will take flight.

That doesn’t look likely. And that’s despite the fact that evidence is mounting that the Fed is at, or at least very close to, peak hawkishness.

Central-bank rhetoric has begun to soften, the midterms are now behind us, and market expectations of where the Fed rate will peak now consistently exceed the high-point implied by its so-called “dot plot” projections. With the market now helping, not hindering, the Fed in its monetary objectives, the central bank shouldn’t have to keep sharpening its talons for much longer.

On top of that, the Fed pivot could come much sooner than most expect. The median length of time between the peak in inflation and the first rate cut is 22 weeks, according to US hiking cycles going back to 1972. June’s CPI print likely marks this cycle’s peak in headline inflation which, historically speaking, would put the first cut in as little as four to eight weeks.

This is not a prediction. But it does highlight how a Fed reversal could happen more quickly than the market expects. Either way, equity investors should treat it as the false dawn it is.

Firstly, financial conditions continue tightening for about five quarters after the first Fed hike. In the current cycle this would take us until the second half of 2023. Secondly, there’s a still greater squeeze in liquidity to come. The Global Real Policy Rate is still extremely negative and close to the all-time lows of -6% it reached in 1974, before it rose all the way to +3% by the early 1980s. Today it is at -4.4%, barely above its -5.6% nadir.

Overall, global financial conditions, as measured by the Global Financial Tightness Indicator, remain very restrictive, with no respite on the horizon. This will remain a poor environment for equities and other risk assets.

Even then, stocks might avoid the worst if the US dodges a recession, but the chances of that are rapidly diminishing as higher borrowing costs filter through the economy. As one of the most interest-rate sensitive sectors, housing is often first to feel the squeeze of those hawkish Fed claws.

As housing costs mount substantially, price growth is falling rapidly. Existing and pending home sales are declining fast. Mortgage rates have risen to 20-year highs, a trend that’s also contributing to the swift decline in growth of building permits. When residential building slows, it almost always leads to a weaker housing market and thus to a more fragile economy. The falling value of the homes they live in will also dent consumers’ confidence.

Used car prices, the poster-child of rapidly rising inflation last year, are collapsing in year-on-year terms as demand slumps. And credit conditions are deteriorating, leading to wider spreads, reduced liquidity and increased difficulty for borrowers in raising money.

Reliable leading indicators, such as the Philadelphia Fed State Diffusion Index and debit balances in customer margin accounts, are at levels that have always preceded recessions in the past. Even if the Fed were to start cutting rates tomorrow, an economic slump already looks to be baked in.

Have no fear you might say, with the market already down over 20% from its highs, a recession is already in the price. But that’s not what the past tells us.

Stocks are, in fact, pretty poor leading indicators, tending to sell off most once a recession has actually begun. Going back to 1960, the median sell-off of the S&P before the beginning of an NBER recession was 5%, but the market goes on to sell-off double that — 10% — in the months following the downturn.

Stocks may find themselves flipping from the inflation frying-pan into the recessionary fire, as the monetary easing the market has so desperately yearned for sets the stage for a new act, which promises to bring yet more misery.

One day after its best day since April 2020, when the S&P500 added 5.5%, or a near-record $1.8 trillion in market cap in one day, a rare 4-sigma move that has only occurred 10 times over the past decade, which essentially showed how wrong-footed the market was ahead of the inflation surprise.…

… the index was set to extend its gains as a FOMO panic started to spread among traders fueled by a softer-than-expected US inflation print and as China reduced the amount of time travelers and close contacts of virus cases must spend in quarantine, and pulled back on testing, in a significant calibration of the Covid Zero policy that has upended the world’s second-largest economy and raised public ire.

Contracts on the US stock benchmark advanced 0.3% to 3,974 at 730 a.m. in New York, having earlier risen as high as 3,997. Nasdaq 100 futures also gained 0.7%, while Treasury futures weakened, with the cash market closed for the Veteran’s Day holiday. Commodities also rallied while the dollar retreated for a second day.

Overnight Beijing announced that travelers into China will be required to spend only five days in a hotel or government quarantine facility, down from ten, followed by three days confined to home, according to a National Health Commission statement Friday. The latest news on China’s Covid policy tweaks “plays with the grain of the post-US CPI moves down in the dollar,” said Ray Attrill, head of FX strategy at National Australia Bank Ltd. in Sydney. “The dollar is highly attuned to swings in risk sentiment, and for now that means dollar down.”

In US premarket trading, Chinese stocks listed in the US soared after Beijing made significant changes to the stringent Covid Zero policy that has bogged down the economy and dented appetite for the country’s equities. Alibaba and JD.com both advanced at least 3.6%. Amazon.com Inc. and Nvidia also extended their Thursday gains with major US technology and internet firms. Health insurance provider GoHealth Inc slumped as much as 22%, on track for the worst day in three months if the move holds, after the firm’s net revenue for the third quarter missed analyst estimates. Here are some other premarket news:

• Doximity shares jumped as much as 19% in US premarket trading after its earnings beat expectations, putting the online healthcare platform on track for its best day in nine months if the move holds. Analysts were encouraged to see the company reiterating its guidance for the full-year amid robust demand from hospital clients.
• GoHealth shares slumped as much as 22% in US premarket trading, on track for the worst day in three months if the move holds, after the health insurance provider’s net revenue for the third quarter missed analyst estimates. The company held off providing full-year 2022 guidance after suspending it back in August, contributing to an uncertain outlook. GoHealth’s shares had bounced 16% this week ahead of its release, though remain down 87% for the year.
• Matterport shares surged as much as 32% in US premarket trading, with the stock set for its biggest gain since its July 2021 IPO, after the 3D camera maker’s results beat demonstrated the company is holding up well amid a difficult real estate market. Demand for its latest products set it up well for next year, analysts noted, while Matterport also narrowed its revenue guidance for the year. Its shares are down 85% year-to- date.
• Shares in cryptocurrency-exposed companies edged lower on Friday, with the price of Bitcoin under pressure amid the unfolding crisis at FTX. Coinbase -0.2%, Riot Blockchain -0.7%.
• Snail shares climb 83% premarket after the company announced a $5m-stock buyback plan. The repurchase plan represents 5.8% of the company’s current market value, data compiled by Bloomberg show.
• AirSculpt Technologies (AIRS US) shares plunged as much as 26% in US premarket trading, putting the stock on track to hit its lowest level since its initial public offering, after the provider of a type of liposuction to remove unwanted fat cut its year outlook.

The S&P 500 and Nasdaq 100 are poised for their best week since June, after official US data showed the consumer price index rose 7.7% in October from a year before, its smallest annual advance since the start of 2022 That fueled bets that the Federal Reserve would rethink how fast it needs to move with interest rate hikes, and also lowered the terminal Fed Funds rate to 4.90% suggesting less than 4 rate hikes are left until the Fed halts tightening.

The positive mood was reinforced after China reduced the amount of time travelers and close contacts must spend in quarantine, scrapped flight bans and pulled back on testing, in a significant calibration of the Covid Zero policy that has isolated the world’s second-largest economy. Chinese stocks listed in the US soared in premarket trading.

Thursday’s data not only spurred short covering as bearishly positioned investors bought back into the market, but it prompted the biggest one-day gain in such hated indexes as Goldman’s Non-Profitable Tech which exploded over 15% higher in one single day!

“Markets were not ready for good news, which is the key takeaway from yesterday’s market reaction. But having said that, inflation is still 7.7%. It doesn’t make a huge difference compared to 7.9% for the US consumer, and so the pressure is still very much there,” said Maurice Gravier, chief investment officer for the wealth management division of Emirates NBD Bank PJSC in Dubai.
Gravier expects volatility to continue until there is clarity about a Fed pause, which he says is slated for the middle of next year, he told Bloomberg TV.

In Europe, consumer products, miners and real estate are the strongest performing sectors. Euro Stoxx 50 rises 0.7%. CAC 40 outperforms peers, adding 0.8%, FTSE 100 lags, dropping 0.3%. Sterling reclaims $1.17. Here are the biggest European movers:

• Richemont reported 1H operating profit that beat estimates, as growth for the maker of Cartier jewelry and watches was led by retail. Shares rise as much as 21%, the most since October 2008, boosted along with peers as China eased some Covid measures.
• Prudential jumps as much as 9.5% to hit its highest level since Aug. 16, gaining alongside China-exposed sectors like luxury and mining
• European real estate stocks extend gains, following a surge in the previous session after US inflation data fueled optimism that the Fed might slow the pace of interest rate hikes. German landlord Aroundtown is among the biggest contributors to the gain at 10%
• Casino gains as much as 21% after the French grocer bought back €67m of Quatrim 2024 senior secured notes in the market, while as a highly indebted stock it also benefits from some relief following US inflation data.
• Defensive sectors retreat in Europe after Thursday’s softer-than-expected US inflation data and the easing of Covid restrictions in China triggered a market rotation into cyclical and growth stocks such as technology and retail. Thales is among the stocks leading the decline at 7.3% and Saab at 6.8%
• DKSH is initiated with a neutral rating and CHF70 PT at Credit Suisse, with the broker saying the risk-reward looks balanced for the distribution group. DKSH shares fall as much as 7.3%, the most since July.
• ACS declined as much as 3.7% on Friday after the Spanish infrastructure company reported earnings Thursday evening, which Renta 4 said showed pressure in the construction business margin.
• GSK is among the biggest laggards on the Stoxx 600 Health care subindex, falling as much as 5.5%, after UBS downgraded the shares to sell from hold, citing “uncertain times ahead still,” and seeing an “unattractive earnings scenario” after 2026.

Asian stocks also traded higher with gains as the region followed suit to the post-CPI global stock surge, while the adjustment of COVID protocols in China including a shorter quarantine for close contacts provided a late tailwind. Hang Seng and Shanghai Comp conformed to the heightened risk appetite with the Hong Kong benchmark frontrunning the advances as it gained by more than 1,000 points, while the mainland was also boosted in late trade on China relaxing its COVID protocols. Nikkei 225 jumped above the 28,000 level amid the risk-on mood and as participants digested a deluge of corporate earnings which have largely influenced the list of best and worst performers for the index.

Australian stocks soared to post the third weekly gain: the S&P/ASX 200 index rose 2.8% to close at 7,158.00, the highest since June 6, with technology and real estate shares rallying most. The benchmark gained for a third straight week.  The move followed a broad-based rally in Asian stocks after slower-than-projected US inflation spurred bets the Federal Reserve will moderate its aggressive rate-hike path. In New Zealand, the S&P/NZX 50 index rose 2% to 11,311.76.

In FX, the dollar extended Thursday’s steep drop, falling against most Group-of-10 peers and hitting its lowest against the yen since late August after China eased some of its quarantine restrictions for inbound travelers, helping to boost demand for higher-risk currencies.  The Bloomberg Dollar Spot Index dropped 0.9% after closing down 2% Thursday for its biggest fall since March 2009, when a softer CPI reading saw traders pull back bets on US rate hikes.

• USD/JPY fell as much as 1.6%, pushing below the psychologically key 140 level
• The euro rose to a three-month high of 1.0279 and headed for its best week since March 2020. Short-term bets turn bullish for the first time since Feb. 11 as shorts trim exposure
• The pound was among the worst-performing G-10 currencies. The gilt curve twist-steepened very modestly
• Australian dollar recovered from selling driven by leveraged funds trimming longs before the weekend. Bonds give back some of their opening gains in the wake of a softer core CPI reading that saw markets reprice the Federal Reserve’s terminal rate lower

In rates, cash treasury trading is closed for Veteran’s day; Treasury futures are open and are slightly lower on the day but remain near the top of the session range from Thursday, when the curve aggressively bull steepened following a lower-than-estimated CPI report. US futures losses are led by long-end of the curve, where long- bond contracts are around 21 ticks lower vs. Thursday close — 10-year futures around 112-08+, remain close to Thursday session highs. Gilts also lower on the day; BOE announced Thursday that the unwinding of emergency bond purchases will begin Nov. 29. Bunds are lower on the day, feeding through to weakness in Treasury futures, with German yields cheaper by 5.5bp to 9.5bp across the curve with losses led by belly. The German curve bear-flattened, while Italian bonds underperformed their German peers, with the 2-year yield rising by around 16bps. Money markets add to ECB tightening wagers ahead of a large slate of ECB speakers

Commodities from oil to iron ore and copper jumped after China eased some Covid restrictions, raising hopes over a demand recovery in the world’s second-biggest economy. Saudi Arabia’s energy minister said OPEC+ will remain cautious on oil production, weeks after the group angered the US by lowering output. WTI drifts 2.4% higher to trade around $88.53; commodities widely surge after China eased some Covid restrictions. Spot gold rises roughly $6 to above $1,762/oz

In crypto, Bitcoin is modestly softer intraday but holds onto USD 17,000+ status. FTX CEO Bankman-Fried is facing an SEC probe related to his crypto empire, according to Bloomberg. Crypto exchange BlockFi tweeted that it is unable to operate business as usual and is pausing client withdrawals, citing a lack of clarity from FTX.com.

Looking to the day ahead now, and data releases include the University of Michigan’s preliminary consumer sentiment index for November in the US, along with the UK’s GDP reading for Q3. From central banks, speakers will include the ECB’s Vice President de Guindos, Holzmann, Panetta, Lane, de Cos, Centeno and Nagel, along with the BoE’s Haskel and Tenreyro. Finally, the EU Commission will be releasing their latest economic forecasts.

Market Snapshot

• S&P 500 futures up 0.5% to 3,979.75
• STOXX Europe 600 up 0.3% to 433.01
• MXAP up 4.8% to 150.99
• MXAPJ up 5.5% to 485.10
• Nikkei up 3.0% to 28,263.57
• Topix up 2.1% to 1,977.76
• Hang Seng Index up 7.7% to 17,325.66
• Shanghai Composite up 1.7% to 3,087.29
• Sensex up 2.0% to 61,803.85
• Australia S&P/ASX 200 up 2.8% to 7,157.95
• Kospi up 3.4% to 2,483.16
• Brent Futures up 2.3% to $95.80/bbl
• Gold spot up 0.4% to $1,761.68
• U.S. Dollar Index down 0.63% to 107.53
• German 10Y yield up 2.9% to 2.068
• Euro up 0.4% to $1.0249

Top Overnight News from Bloomberg

• The yuan has swung violently from one end of its tightly-managed trading band to the other like never before, as optimism toward a pivot from Covid-Zero evaporated concern about President Xi Jinping’s consolidation of power
• SNB Governing Board member Andrea Maechler expects inflation in Switzerland to stay elevated for at least two more years, she told newspaper L’Agefi
• UK Prime Minister Rishi Sunak faces an extraordinary balancing act in his autumn budget next week. He needs to appease financial markets with a package of spending cuts and tax increases, while also winning over disgruntled voters
• Chancellor of the Exchequer Jeremy Hunt is preparing to cut planned public spending growth to 2% or lower after 2024-25, compared to a previous provisional plan of 3.7% growth, according to a person familiar with his thinking
• The BOE signaled it will move cautiously in selling off the £19 billion ($22 billion) of UK government bonds it snapped up in emergency action in recent weeks, outlining a “demand-led” approach to the sales
• A decade ago this week, former UK chancellor George Osborne declared that income from bonds the Bank of England acquired under its quantitative-easing program could be used to reduce government debt. Now, the government expects to send £11 billion ($12.8 billion) to the central bank to cover an anticipated shortfall on the portfolio in the months to April
• German lawmakers approved next year’s federal finance plan including net new borrowing of €45.6 billion ($46.6 billion), according to documents seen by Bloomberg
• EU officials in Brussels on Friday slashed their forecast for growth next year, predicting barely any expansion, and raised all their projections for consumer prices. They reckon the economy is now shrinking and will keep contracting during the first quarter

A more detailed look at global markets courtesy of Newsquawk

APAC stocks traded with firm gains as the region followed suit to the post-CPI global stock surge, while the adjustment of COVID protocols in China including a shorter quarantine for close contacts provided a late tailwind. ASX 200 was led by tech and the real estate sector amid the lower yield environment. Nikkei 225 jumped above the 28,000 level amid the risk-on mood and as participants digested a deluge of corporate earnings which have largely influenced the list of best and worst performers for the index. Hang Seng and Shanghai Comp conformed to the heightened risk appetite with the Hong Kong benchmark frontrunning the advances as it gained by more than 1,000 points, while the mainland was also boosted in late trade on China relaxing its COVID protocols.

Top Asian News

• China’s National Health Commission released adjusted protocols for COVID prevention and control with quarantine for close contacts cut to 5 days centralised isolation and 3 days home quarantine from 7 days centralised isolation and 3 days home quarantine. China is also to cut COVID quarantine for inbound travellers from 10 days to 8 days and it cancelled the circuit breaker for inbound flights, according to Reuters.
• China disease control researcher earlier said that China is to continually improve its COVID-19 policies and will not relax them while the virus mutates and the epidemic situation changes, according to Reuters.
• Haizhu district of Guangzhou extended its COVID lockdown until November 13th, according to Reuters.
• China is expected to take additional measures to support the economy by conducting the largest cash injection this year through MLF loans or by reducing RRR, according to Bloomberg.
• US customs said it had seized 1,053 shipments of solar equipment since June under the China forced labour ban, while the shipments are primarily from Longi (601012 CH), Trina (688599 CH) and Jinkosolar, according to Reuters.
• Arm IPO unlikely to take place by March 2023, according to Softbank (9984 JT) sources cited by Reuters.

Major bourses in Europe are mostly firmer following CPI-induced optimism which saw further gains on Wall Street after the European cash close, with the sentiment then reverberating in APAC before seeing another boost on reports that China is easing its COVID measures. Sectors in Europe are mostly in the green with the laggards comprising of defensives, whilst the top performers include Tech, Real Estate, Retail, and Basic Resources. US equity futures are trading sideways with modest gains across the board, with futures holding onto yesterday’s upside.

Top European News

• UK Real Estate Slumped to Worst Quarter Since 2009 as Rates Bite
• Richemont Surges on Record Profit and China’s Covid Easing
• European Gas Prices Soften as Storage Fill Limits Rationing Risk
• European Mining Stocks Jump as Metals Gain on China Covid Easing
• United Internet Said to Pick IPO Banks for Web Hosting Unit
• European Stocks Set for Best Week Since March on Fed Bets, China

FX

• DXY remained downtrodden amidst further fallout, or capitulation on the back of October’s comparatively soft CPI data that ramped up Fed pivot expectations.
• G10s are firmer across the board against the Dollar, with the Japanese Yen the outperformer as USD/JPY fell under 140.00.
• The Yuan stands as the EM outperformer after China said it will ease some COVID measures.

Fixed Income

• US Treasuries are hovering midway between its 112-18/03+ overnight range ahead of prelim UoM sentiment and inflation expectations.
• Gilts pared more losses to get within 2 ticks of 105.00 having been down to 104.06.
• Bunds have recovered from a deeper low, at 139.38 and perhaps on technical grounds as 139.35 represents a 50% Fib retracement of Thursday’s rally.

Commodities

• WTI and Brent are extending the gains seen overnight which were sparked by China easing its COVID measures.
• Saudi Energy Minister said OPEC+ will remain cautious on production, via Bloomberg; OPEC+ will not lose sign of what the oil market needs.
• Chinese refiners will reportedly reduce Saudi crude oil term volume loading in December, according to sources cited by Reuters.
• Spot gold extends its gains above its 100 DMA (1,714/oz) and above the USD 1,750/oz mark as the Dollar crumbles.
• Base metals also firmer across the board with added tailwinds from China’s easing of COVID measures – 3M LME copper eyes USD 8,500/t to the upside from a USD 8,271/t intraday base.

Geopolitics

• Russian Kremlin said goals of the special military operation can be achieved with peace talks but peace talks are not possible due to the Ukrainian position. Russian Kremlin said grain deal contacts ongoing, number of issues need to be resolved, via Reuters.
• US Secretary of State Blinken tweeted that he has directed another USD 400mln worth of arms and equipment from Department of Defense inventories to Ukraine.
• US issued a general licence authorising certain transactions relating to energy with some Russian banks. It was also reported that insurers said gaps in the G7/EU Russian oil price cap plan could leave tankers stranded at sea and disputes over compliance with the oil price cap could lead to a loss of insurance cover and refusal to discharge, according to Reuters.
• Chinese President Xi will meet with US President Biden, according to the Chinese Foreign Ministry.
• US Treasury Secretary Yellen is to meet which PBoC Governor Yi Gang on the sidelines of the G20; to discuss global economic situation and hopes to learn more about China’s property sectors; Yellen to update Yi on US economic conditions, via Reuters.
• Russian President Putin to skip the APEC summit (13-17th Nov), according to a Thai official
• Russian Deputy Foreign Minister said Russia-US Commission on New START treaty is to meet late November/early December in Cario, according to Ria.

US Event Calendar

• 10:00: Nov. U. of Mich. Sentiment, est. 59.5, prior 59.9
  • U. of Mich. Current Conditions, est. 62.8, prior 65.6
  • U. of Mich. Expectations, est. 55.5, prior 56.2
  • U. of Mich. 5-10 Yr Inflation, est. 2.9%, prior 2.9%
  • U. of Mich. 1 Yr Inflation, est. 5.0%, prior 5.0%

DB’s Jim Reid concludes the overnight wrap

If ever we needed proof that the market is absolutely desperate for some good news on inflation, yesterday proved it in spades with the market moves up there with the most remarkable since the pandemic began thanks to a -0.2% miss in both headline and core inflation. Both measures missed by that much as recently as July so we have been here before not long ago, but one has to go back to August 2014 to find the last time both headline and core both missed by at least -0.2% before that.

Having said that it’s still a long, long, long path ahead towards anything resembling normal inflation, but with monthly core CPI running at its slowest pace in over a year, investors immediately latched onto hopes that the Fed wouldn’t need to be as aggressive in raising rates, leading to a massive surge across all the major asset classes. For instance, yields on 2yr Treasuries (-24.7bps) saw their largest daily decline since 2008, the S&P 500 (+5.54%) had its best day since April 2020, and the dollar index (-2.12%) suffered its worst daily performance since 2015. So definitely one for the history books.

I don’t think there is anything inconsistent in saying that markets continue to be set up for a rally (technicals, seasonals, better European near-term energy outlook etc.) while also thinking next year could ultimately be pretty bad. Back in April when we first said we thought the US would be in recession by the middle of 2023, the consensus expectation for CPI by Q4 2022 was 4.5%. The headline rate was still 7.7% yesterday. So our conviction remains the same.

Indeed, even with the surge in risk sentiment, the Fed’s preferred yield curve measure (18m3m – 3m) for predicting the cycle spectacularly entered inversion territory yesterday, falling -37.1bps to -13.7bps. When quizzed in the past about the veracity of 2s10s (my preferred yield curve signal), Chair Powell has deflected its recessionary signal, claiming it’s confounded with a number of other variables. Instead, the Fed’s preferred measure strips out the noise and sharply focuses on the near-term policy path, where inversion implies policy rate cuts due to recession. One wonders how he would respond now to questions on yesterday’s inversion.

When it comes to the full details of that report, monthly headline CPI surprised to the downside at +0.4% (vs. +0.6% expected), meaning that the year-on-year number ticked down to +7.7% (vs. +7.9% expected), thus continuing its descent from its June peak of +9.1%. What was even better from a market perspective was the deceleration in core CPI as well, where the monthly reading fell to +0.3% (vs. +0.5% expected). In fact, with core at +0.27% to two decimal places, that’s actually the slowest since September 2021, so an encouraging sign. And in turn, the year-on-year measure for core fell to +6.3% (vs. +6.5% expected), moving off its recent peak in September. One last piece of good news was that the decline in inflation was broad-based rather than being driven by outliers, and the Cleveland Fed’s trimmed mean measure saw its slowest monthly growth since April 2021 at +0.37%.

Even with an optimistic CPI report, Chair Powell has highlighted one of the most persistent sources of inflationary pressures would come from a too-hot labour market. There, yesterday, we got the Atlanta Fed wage growth tracker which showed still sturdy wage gains, with the 3m moving average of yoy wage growth increasing +0.1% to 6.4%. That’s below the 6.7% peak, but above every other print on record outside of recent data. So, progress will be long in coming, and won’t be helped if financial conditions exhibit large knee-jerk easing trends in response to any optimistic news.

For now though with inflation surprising on the downside, investors moved to dramatically reprice their expectations for Fed tightening over the months ahead. In the near term, futures raised the chances that the Fed will slow down the pace of rate hikes to 50bps next month, moving away from the jumbo 75bps pace of the last 4 meetings. Indeed, the amount of hikes priced for the December meeting came down -5.5bps on the day, leaving it at just 50.9bps now. Looking further out, the terminal rate priced for Q2 came down from 5.04% the previous day to 4.89%. And when it comes to end-2023, the rate priced in came down by an even larger -31.4bps to 4.38%, signalling that investors are becoming more confident about the odds of rate cuts as we move deeper into next year.

In response to the CPI release, Fed officials struck their usual cautious tone, with San Francisco Fed President Daly saying it was “far from a victory”, and Dallas Fed President Logan saying it was “a welcome relief, but there is still a long way to go”. And to be fair to them, annualised CPI inflation was still running at +5.4% in October, so there are grounds for caution in spite of the market optimism. Nevertheless, Logan validated market expectations that we’re about to see a downshift in rate hikes, saying that “I believe it may soon be appropriate to slow the pace of rate increases so we can better assess how financial and economic conditions are evolving”, although she also said she believes “a slower pace should not be taken to represent easier policy”. Philadelphia Fed President Harker struck a similar tone on slowing down, saying he expected they would “slow the pace of our rate hikes as we approach a sufficiently restrictive stance”.

As investors moved to expect a more dovish Fed over the coming months, Treasuries surged across the board, with the 2yr yield (-24.7bps) seeing its largest daily decline since 2008, to close at 4.33%. Those declines were driven by a mixture of lower real rates and inflation breakevens, and the 10yr yield (-28.0bps) also saw its biggest daily decline since March 2020 at the height of the pandemic. This sense that central banks were about to be more dovish was evident in Europe too, and downgraded expectations of future ECB tightening sent yields on 10yr bunds (-16.2bps), OATs (-19.0bps) and BTPs (-27.9bps) sharply lower as well.

Equities surged alongside bonds on the back of these hopes about a central bank pivot. In fact, the S&P 500 (+5.54%) had its best daily performance since April 2020, which for now makes this rally an even more aggressive version of the other 6 Fed pivot trades we’ve identified over the last 12 months. Every sector group advanced on the day, but the cyclicals strongly outperformed, and the NASDAQ (+7.35%) had its best performance since March 2020. Unsurprisingly, the FANG+ Index outperformed even more, given the sensitivity of underlying valuations in the index to discount rates, increasing +9.39%, its best day since March of this year. That coincided with a marked reduction in the VIX index of volatility, which fell -2.56pts to a 2-month low of 23.5pts. In Europe there was also a marked turnaround, with the STOXX 600 leaping from marginally positive territory just prior to the report to end the day up +2.75%.

Ironically we were seeing risk assets pretty nervous prior to CPI given all that was going on in the crypto space. The latest here was that Alameda Research, the hedge fund linked to FTX – the crypto exchange whose issues started this week’s crypto route – would be winding down, while there was back and forth about whether FTX would ultimately be rescued. However a soft CPI shunted this into the weeds as Bitcoin closed +13.20% at $17,808, notably above the low during the Asian session of $15,618.

Whilst risk parity was having a great day, there were some marked shifts in FX, where the dollar index (-2.12%) fell to its worst daily performance since 2015, slumping against every other G10 currency. The Japanese Yen was a particular outperformer, gaining +3.90% on the day versus the dollar, as was the British pound which strengthened +3.15% to levels not seen since before the government’s mini-budget. Those moves leave the dollar index at its lowest closing level since mid-August, before Fed Chair Powell delivered his hawkish speech at Jackson Hole.

This morning, equity markets in Asia are matching the upbeat mood, extending the overnight rally on Wall Street. Across the region, the Hang Seng (+7.06%) is leading gains with the Hang Seng Tech Index (+8.36%) echoing that outperformance we saw from US tech stocks, whilst other indices including the KOSPI (+3.36%), the Nikkei (+2.95%), the CSI (+2.86%) and the Shanghai Composite (+2.06%) are all noticeably higher. That was supported by the positive US inflation news, but there were also some developments on the Covid situation in China that bolstered sentiment, since they cut the quarantine time for inbound travellers to 8 days from 10, and also reduced the quarantine time for close contacts to 8 days as well, even as the total number of daily cases moved above 10,000 for the first time since April. Otherwise, US equity futures are pointing higher this morning, with those on the S&P 500 up +0.40%, and the Japanese Yen (-0.43%) has fallen back slightly against the US Dollar after its +3.90% rise in the previous session. That follows data showing that Japan’s producer prices inflation fell to +9.1% year-on-year in October (vs. +8.8% expected), marking the slowest pace of growth since January.

Turning to the midterm election results, we didn’t get much in the way of updates yesterday, and the question of which party ends up controlling each chamber in Congress remains unconfirmed. However, as was the case 24 hours ago, it continues to look as though the Democrats have the stronger chance in the Senate. Indeed, it’s possible that the Democrats hit the 50-mark before the Georgia runoff on December 6 if they can win the two other races in Nevada and Arizona. Meanwhile in the House, the Republicans continue to have the edge, since although they’re not at the 218-majority mark just yet, they’re leading in enough of the outstanding districts to give them a narrow majority as it stands.

Back in Europe, our research colleagues in Frankfurt published their latest gas supply monitor yesterday, where they see an increased likelihood that Germany will be able to avoid rationing this winter. The key risk factors to that are a cold winter spell or pipeline disruptions that affect gas demand and supply respectively. It also looks forward to the EU energy ministers’ meeting on November 24, and points out that the EU Commission could present elements of its gas price cap proposal as early as today for a meeting of EU ambassadors, which is unlikely to include a hard cap but could still pave the way for a compromise. You can see the full report here.

Looking at yesterday’s other data releases, the US weekly initial jobless claims rose to 225k (vs. 220k expected) in the week ending November 5, which leaves the 4-week moving average at 218.75k (vs. 219k previously).

To the day ahead now, and data releases include the University of Michigan’s preliminary consumer sentiment index for November in the US, along with the UK’s GDP reading for Q3. From central banks, speakers will include the ECB’s Vice President de Guindos, Holzmann, Panetta, Lane, de Cos, Centeno and Nagel, along with the BoE’s Haskel and Tenreyro. Finally, the EU Commission will be releasing their latest economic forecasts.

Authored by Irina Slav via OilPrice.com,

• European leaders are unhappy with natural gas prices.

• Some leaders are insisting that the EU impose a price cap on all natural gas imports, regardless of origin. 

• U.S. LNG has been more expensive than pipeline gas coming from Russia in real terms.

Last month, France’s president Emmanuel Macron accused the United States of a “double standard” because of the difference between the price at which liquefied natural gas produced in the U.S. sells in Europe and the price at which natural gas sells within the U.S.

“The North American economy is making choices for the sake of attractiveness, which I respect, but they create a double standard,” Macron said, also adding that “they allow state aid going to up to 80% on some sectors while it’s banned here — you get a double standard.”

He wasn’t alone among European national leaders in being unhappy about gas prices.

In fact, as many as 15 leaders were unhappy, and they insisted that the EU imposes a price cap on all natural gas imports, regardless of origin.

The idea followed delicate attempts to convince Norway to sell its gas at a discount and equally delicate attempts to convince U.S. producers of the same.

Now, the U.S. is striking back at the accusations.

“What’s happening is the companies that hold those long-term contracts with US LNG producers, they’re marking that up and earning that margin in the European market,” Brian Crabtree, an assistant secretary at the Department of Energy, told the Financial Times.

“It’s not the US LNG company, it’s basically European-headquartered international oil companies and traders.”

Indeed, producers of liquefied natural gas do not invariably sell their product directly to the consumer, in the face of a country in Europe, for instance, They work with commodity majors such as Vitol and Trafigura, or the supermajors, including BP and Shell.

Take Cheniere Energy, the biggest producer of LNG in the United States. Earlier this year, Cheniere inked a long-term sale and purchase deal for its LNG with Chevron. Under the deal, Chevron will buy 2 million LNG from Chevron annually, and then it will sell it on for whatever price it deems fair.

Also this year, Cheniere closed another sales and purchase deal, too, with Norway’s Equinor, this time for an annual volume of 1.75 million tons of LNG. Those 1.75 million tons will also be sold at a price that Equinor sets, not Cheniere. 

This is not to say that LNG producers are not benefiting from the much stronger demand for LNG from Europe. And this is exactly the reason they have been benefiting, in the form of higher profits: demand has surged, and when demand surges, prices follow, especially if supply is not growing as fast as demand. 

Earlier this month, Cheniere Energy reported twofold revenue and profit growth for the third quarter, thanks to this stronger demand for its product. Separately, the company said it was ready to sign more long-term supply contracts, both with businesses and governments in Europe, which would motivate its planned capacity expansion.

At the same time, BP reported exceptionally strong performance at its gas-trading unit. This was not the case for Shell, however, whose gas-trading division booked a loss of $1 billion for the third quarter of the year because of the spike in European gas prices after the suspension of exports via Nord Stream 1.

Macron’s—and others’—accusations, then, are not exactly founded on facts, with producers being just the first stop in a supply chain that features middlemen that are among the biggest commodity trading businesses in the world. Besides, even in the best of times, U.S. LNG has been more expensive than pipeline gas coming from Russia in real terms.

The reason for this is purely physical. The production of liquefied natural gas is much more complex process than purifying natural gas and sending it down a pipeline. Because LNG production is more complex, it automatically means it is more expensive because it is quite energy—intensive.

Once produced, this gas needs to be transported on tankers that are in short supply as well this year, which has pushed freight rates through the roof, adding to traders’ expenses in shipping the product to customers.

In other words, Europe seems to want businesses to not act as businesses and take every opportunity to make a profit, which is what businesses are all about.

But instead of addressing these businesses, many of which are based in Europe, as the DoE’s Crabtree told the FT, it is addressing the federal U.S. government, which has little control over the private sector.

Be that as it may, Crabtree told the FT that the U.S. was committed to helping Europe get enough gas “at a price that is affordable to the continent.” It’s hardly a surprise he did not go into detail on how this affordable price would be achieved. It is also no surprise that his statements to the FT contained a warning.

“So it’s especially concerning to us that the discussion in Europe is being presented as though we have some control over the margins that are being earned on our LNG, because we don’t,” the official said.

The Vatican’s former chief auditor, Libero Milone, says he was raided by gendarmes in June of 2017, after which he was accused of spying on top Vatican cardinals.

“Now you have to confess,” they demanded, according to Milone, who says he signed resignation papers instead of face time in a Vatican jail, the NY Times reports.

Since his ouster, the Vatican – which has been plagued with financial (and pedophilia) scandals for decades – has attempted to clean up its act. Cardinal Giovanni Angelo Becciu – who Milone was accused of spying on (and, Milone believes, was behind his ouster), has himself been booted from his position by Pope Francis, and is now standing trial in the Vatican for embezzlement and abuse of office in connection with a shady $135 million London real estate deal.

Milone, however, has come back under the spotlight after the Vatican reopened a criminal investigation against him in what he claims is an attempt to make him go away after filing a lawsuit against the Vatican’s Secretariat of State, its most powerful department, and the current auditor general.

“All these matters were reported to the pope. I wasn’t spying. I was doing my job,” he said.

“I didn’t know that I would find cardinals putting money in their pocket, but I found it. And I told him,” he said, referring to Pope Francis.

In their suit, Mr. Milone, the former chief executive of Deloitte & Touche Italy, and a fellow auditor, Ferruccio Panicco, who blames the Vatican for having contributed to the advancement of his prostate cancer and cut short his life span by confiscating and withholding his medical records, are seeking about nine million euros in damages. They say the Vatican unjustly terminated their contracts, sullied their professional reputations and essentially blacklisted them in Italy, where, Mr. Milone said, “You can’t cross the Vatican.” -NYT

According to Milone’s lawsuit, the Vatican is a “viper’s nest” of financial wrongdoing, hypocrisy, and a ‘reign of terror’ by internal spies within the gendarmes. What’s more, the complaint outlines how Vatican officials enrich themselves, or misappropriate funds to upgrade their apartments.

Milone says Pope Francis went from demanding personal PowerPoint presentations regarding his findings, to ignoring him when Vatican bureaucracy ‘poisoned his ear,’ and finally, to ‘personally demanding’ that he be fired.

The fired auditor says he was simply doing his job he was hireed to do.

In one case, auditors  discovered that some Vatican departments kept gold bricks and coins, however they claimed to have ‘lost the keys’ when asked to inventory them. Meanwhile, the Vatican department in charge of church-owned real estate repeatedly tried to block his investigations, and even hid financial records, Milone says.

He also accused cardinals, whom he declined to name now but said he would if his case went to trial, of pocketing tens of thousands and sometimes hundreds of thousands of the church’s dollars. He said he found that one cardinal received 250,000 euros in donations that he kept in a plastic shopping bag in his office. The prelate deposited an additional 250,000 euros, he claimed by accident, into his own personal account rather than into the account of the Vatican department that he ran. Mr. Milone informed Francis, who was furious, and instructed him to tell the cardinal that he had been caught, he said. -NYT

“This person became red. ‘But in my country I can do what I like,’” said the thieving Cardinal, who eventually returned the money.

Milone says Cardinal Becciu planted evidence that was discovered in the 2017 raid, after the head of the gendarme ‘knew precisely where to look,’ like ‘a bloodhound.’

“It is all done deliberately to get me out when they decided in March 2016 that I was a danger because I was asking too many questions,” he said.

In 2018, the Vatican’s chief prosecutor said there were no investigations against Milone – contradicting a 2017 statement that they had been investigating him for more than seven months for alleged spying and misappropriating funds for his own interests.

In 2019, Milone says Cardinal Parolin informed him that his case had been sealed by Francis.

When he sought to see the evidence compiled against him, the Vatican’s chief prosecutor replied in a January 2020 letter that he had ‘no right’ to see the information, declining his request.

Now, the Vatican has lifted the seal – but instead of sharing the information with Milone, they have reopened a criminal investigation against him.

“They want to threaten me,” he said, arguing that the Vatican was using ‘clearly fake’ evidence – including a forged documents dated months before he was even hired for his job.

Milone and his lawyers say they are ready to fight in court, even if the odds are stacked against them.

Authored by Owen Evans via The Epoch Times,

The Hertfordshire Police and Crime Commissioner (PCC) said that journalists should be “thinking about” whether it was right to give eco-activists Just Stop Oil the “oxygen of publicity.”

David Lloyd told LBC’s Nick Ferrari on Thursday that officers may have “got it wrong” after LBC reporter Charlotte Lynch was detained while reporting on Just Stop Oil, which is currently causing widespread disruption on the M25, the UK’s busiest motorway.

Lynch described being handcuffed and detained on suspicion of conspiracy to commit public nuisance after having shown officers media accreditation.

Climate group Just Stop Oil, an offshoot of Extinction Rebellion, has been staging disruptive protests in an attempt to highlight its call for the UK government to begin the process of winding down fossil fuel production in the country.

But Lloyd said that journalists should be “thinking about” whether it was right to report on Just Stop Oil in such a way that gives them so much publicity.

‘Managing to Get Their Message Out There So Very Successfully’

“There is though something else, you’ve held me to account and rightly so about this and I have apologised for it, but I do think that you too need to work out how we as a society, as a community, ensure that the oxygen of publicity which Just Stop Oil is seeking is moderated,” said Lloyd to Ferrari.

The PCC added:

“And don’t get me wrong on this. I am not saying that we shouldn’t have a free press and it shouldn’t be reported.”

“But we do need to think where they sit on the front pages in newspapers, where they sit within reporting that LBC is doing because I think your editorial policy needs to reflect whether or not we want to be part of the problem which is how Just Stop Oil are managing to get their message out there so very successfully,” he said.

Ferrari asked if they shouldn’t cover them.

Lloyd said that he thinks “it’s more nuanced than that” saying that traffic bulletins need to cover that the M25 is closed.

He then drew a comparison with how he imagined the press would report on a person trying to take their own life on a ring road, which he did not think would be covered “in the same way.”

“But it strikes me for example when we have people who have mental health issues and are using those very same bridges and gantries because they wish to harm themselves, we don’t have as the lead story on any main media outlet that someone is standing there trying to commit suicide, we find ways of telling people that the motorway is closed and there is an incident,” he added.

“I think we’ve just got to ask ourselves as a society if we are handling the Just Stop Oil appropriately by giving them the oxygen of publicity,” Lloyd.

“I put it to you that you are far better versed in police affairs than I am, but perhaps in the news business I might just have the edge. This is news if you close vast tracks of a 116-mile orbital road because of one particular protest. That’s what we in the business call news,” said Ferrari.

A US special forces unit has stepped up its operations inside the Arctic Circle in Norway while admitting it is trying to get Russia’s attention by testing an experimental new weapons delivery system there.

“It puts this thing within range of Russia,” Special Operations Command Europe’s Lt. Col. Lawrence Melnicoff was quoted as saying of the new parachute dropped long-range missile which was tested. “We are intentionally trying to be provocative without being escalatory.”

“We’re trying to deter Russian aggression, expansionist behavior, by showing enhanced capabilities of the allies,” he added in the comments given to military magazine Stripes.

The experimental weapon system and program is called Rapid Dragon, and on Wednesday it was successfully test-fired at Norway’s Andoya Space Range, which is the country’s premiere far-northern weapons testing site.

Rapid Dragon is a new cruise missile delivery method which begins by parachuting a long-range missile from the back of a C-130 plane. A guided missile then shoots out during the descent of the large crate containing the projectile, as video of this week’s successful deployment shows…

#BREAKING video from 352nd Special Operations Wing successful test fire of a palletized Joint Air to Surface Standoff Missile (JASSM). Successful extraction of deployment box, release of JASSM with wing extension, and motor engagement during exercise #ATREUS22 #SOFinEurope pic.twitter.com/3hLcXDJ3bl

— US Spec Ops Europe (@US_SOCEUR) November 9, 2022

According to a brief explanation of how the unusual delivery system works: 

The Red Dragon system uses a steel cage and can be loaded with Joint Air to Surface Standoff Missiles, which have a range of up to 1,200 miles depending on the variant.

“The way it works is it drops out of cargo aircraft like a heavy equipment air drop, so it’s completely a roll-on, roll-off package,” Melnicoff said.

After rolling out, the cage stabilizes under parachutes. Then a sling gate opens and the missiles drop out.

Other weapons like swarming drones can be deployed utilizing this method as well, the US military says. The unusual delivery is in part designed to disguise a long-range missile launch as but a typical battlefield airdrop from a cargo plane, thus catching the enemy off-guard until the missile is already well on its way to target.

Melnicoff described further of the unconventional delivery method: “It complicates Russian decision-making because we know that they’re targeting very, very large specific aggregations of allied power… Ramstein Air Base, RAF Lakenheath, things like that.” He added: “We’re survivable. If worse comes to worst and somebody takes out these power hubs, we can forward-project precision artillery fire across the alliance with our partners.”

Authored by Katabella Roberts via The Epoch Times,

Germany’s government blocked on Nov. 9 the sale of two domestic semiconductor factories to Chinese-owned companies, citing security concerns.

“We have prohibited a non-Union investor from entering into business ventures in Germany,” Economy Minister Robert Habeck told reporters in front of the German chancellor’s office on Nov. 9.

Habeck noted that the decision came because the “security of order in Germany must be protected and critical production areas require special protection.”

Elmos Semiconductor, which makes chips for the automotive industry, was barred from selling its factory in Dortmund, Germany, to Silex, a Swedish subsidiary of China’s Sai Microelectronics.

In a Nov. 7 statement, Elmos stated that it had been warned by the German Economy Ministry that the sale to Silex would likely be prohibited, noting that this was a “recent development.”

The company said it would examine the details after receiving the decision and decide on what further steps to take.

Silex announced in December 2021 that it had signed a sale and purchase agreement with Elmos to buy the factory for 85 million euros ($85.4 million), with the transaction expected to close in the second half of 2022, subject to customary closing conditions and regulatory approvals.

Rising Security Concerns

The decision by Germany’s government comes amid rising concerns over European countries’ dependence on Beijing and concerns that Chinese investment in its critical infrastructure could leave it exposed to national and economic security issues, as well as to political pressure from the Chinese communist regime.

Semiconductors are an essential component in everything from electronic devices such as mobile phones to electric vehicles.

Earlier this year, the European Union unveiled a multibillion-euro “Chips Act” aimed at bolstering Europe’s competitiveness and resilience in semiconductor technologies and applications and reducing its dependence on supplies from Asia.

“We must look very closely at company takeovers when it relates to important infrastructure or when there is a danger that the technology would flow to buyers from non-EU countries,” Habeck said, according to local reports.

He also noted that the sale of a second company had been turned down by the government, but he didn’t name the companies involved, citing “trade secrets.”

However, Germany’s minister for research, Bettina Stark-Watzinger, revealed the company to be Bavaria-based ERS Electronic, according to local reports. According to its official website, ERS Electronic supplies thermal wafer test technology to the semiconductor industry.

It’s unclear which Chinese company was interested in buying the German firm.

ERS Electronic hasn’t publicly commented on the matter. Company officials didn’t respond to a request by The Epoch Times for comment by press time.

Germany’s decision to halt the sale of the semiconductor factories comes as the country is facing a recession that has been further exacerbated by Russia’s invasion of Ukraine and the subsequent energy crisis.

Last week, German Chancellor Olaf Scholz met with Chinese leader Xi Jinping for a meeting that focused on business ties between the two nations as Germany’s relationship with Russia continues to deteriorate.

Hungarian Foreign Minister Peter Szijjarto went off on “failed” and backfired US and European sanctions on Russia in an English language interview published this week. 

“The sanctions which have been introduced by the European Union [against] Russia have failed. It’s a total failure,” Szijjarto told Jordan’s Roya News in a televised appearance. He decried that the biggest impact was felt negatively by EU member states and further that the sanctions have not achieved any of their stated goals.

In his most blistering criticism aimed at EU decision-makers, the top Hungarian diplomat described, “It was said by the European Commission that the sanctions will help us to conclude this war as soon as possible and that it will bring Russia’s economy to its knees. What’s the outcome? It’s totally the opposite.”

Instead, he warned the economic war still being waged against Moscow is only resulting in escalation on the battlefield, as well as escalating inflation at home. “The war is becoming more and more brutal … And, in the meantime, the European economy is suffering very badly,” he said, observing too that Europe is now enduring a “tremendous energy crisis” and rising food prices. 

Hungary has been a thorn in the side of European policy which seeks to punish Russia for its Ukraine invasion. Most recently, Budapest has refused to assist NATO allies in the training of Ukrainian troops. It has also been widely accused of undermining Western efforts to bolster Ukraine’s defense, for example with the ban on allowing weapons transit directly from Hungary to neighboring Ukraine. 

FM Szijjarto rejected these charges in the interview, saying, “Basically, we are the only ones in Europe who are arguing in favor of peace.” Budapest has also resisted at every turn EU efforts to impose Russian energy bans or an oil price cap, underscoring it must think of its economy and the well-being of the Hungarian people first. 

Additionally he cited as “the outcome of a failed sanctions policy” that Hungary was forced to pay €19 billion for energy imports this year, which is more than double €7 billion it paid in 2021 – a “huge” consequence of EU short-sighted actions, he said.

Watch the full 10-minute interview segment here:

Authored by Steve Watson via Summit News,

A 72-year-old man has been sentenced to six months in prison for the crime of serving mince pies with wine at his shooting club in 2020 while the area was under a lockdown.

The BBC reports that “Maurice Snelling broke tier three restrictions at Cloudside Shooting Grounds in 2020,” by allowing people to sit in at his premises rather than take away.

Utter madness:
Cloudside man who served mince pies in lockdown jailed – BBC News https://t.co/EzPZjbPC4F

— Allison Pearson (@AllisonPearson) November 9, 2022

Mr Snelling pleaded guilty to perverting the course of justice, but argued that his club was in an area where restrictions stated visitors could sit inside and consume drinks if they were accompanied by food.

The judge presiding over the case was not convinced, however, and said “I find it hard to believe that Mr Snelling didn’t know which lockdown tier he was in.”

Police disrupted the gatherings at the time after residents in the area reported Snelling.

He reportedly refused to provide police CCTV from the club and allegedly attempted to have the footage destroyed, prompting the contractor company hosting it on a hard drive to hand it over to authorities.

The lawyer representing Snelling told the BBC that he has suffered ill health since the case began and “This has tarnished his reputation. He believed he was targeted by neighbours and this built up resentment of a man with good character.”

The report also notes that the Judge believed Snelling to be “anti-establishment, especially to the police. He doesn’t like being told what to do. He treated police with resentment.”

During the lockdown periods in the UK there were scores of reports of people refusing to go along with the restrictions and being reported to the police by neighbours. Many incidences were clearly innocuous and involved people sitting alone in their cars or out walking alone. Other people trying to get to work or shop in supermarkets were routinely harassed by police.

In one incident, Police in the UK arrested a man for handing out free soup to homeless people in a park, claiming that he had violated COVID-19 restrictions.

Meanwhile, the British government was literally holding parties in Downing Street.

Boris Johnson had several parties during lockdown and got away with it. This guy served mince pies during lockdown and has been literally sent to prison. England is a complete embarrassment. https://t.co/eLeRDPlQLI

— Jake Hanrahan (@Jake_Hanrahan) November 9, 2022

Partygate gets a £50 fine this guy goes to jail. One rule for them, one rule for us. #draintheswamp Cloudside man who served mince pies in lockdown jailed – BBC News https://t.co/3xtLN88smw

— Right Said Fred (@TheFreds) November 9, 2022

This is an insane waste of the justice service and an affront to decency.

Nonces walk free, but break the new rule and jail!

BBC News – Cloudside man who served mince pies in lockdown jailedhttps://t.co/YWFLcwhz2K

— sampleofclamps (@schapman24) November 9, 2022

The evidence is now overwhelming that lockdowns did next to nothing to stop the spread of COVID, but did have monumental negative societal and health impacts.

*  *  *

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