While we will shortly show in our full payrolls preview that expectations for December payroll growth are clustered around 200,000, in his daily note, TS Lombard economist Steven Blitz writes that in the coming months one should expect the pace of hiring to slow, as it always does late cycle – aided and abetted by tightening monetary policy (and that’s even without the BLS admitting the recent finding by the Philly Fed that payroll growth in Q2 was just 10,000 not 1,100,000 as initially reported). Recall that in 2005, the median monthly change in nonfarm payrolls was 175,000, when then dropped to 143,000 in 2006 and 61,500 in 2007. In 2018, the median was 165,000 and123,500 in 2019. In other words, “expect the monthly hiring pace to drop closer to 150,000 in Q1.”

But where, in a world where most indicators such as initial claims, ADP, Challenger layoffs and ISM employment data are showing strong labor market data, should one look to find downward inflection points or their harbingers? According to Blitz, there are two critical datapoints to keep an eye on, the first of which we discussed just yesterday, namely the data series on new hires and the hiring rate from the JOLTs report, which as we showed had unexpectedly shrunk to the lowest level in two years even as the level of quits has remained surprising high.

The other data point is corporate profits as proxied most directly (and without any non-GAAP adjustments by management or political operatives at the BLS) by the amount of taxes corporations pay to the Treasury.

Starting with the former, Blitz writes: “Indicating the coming slowdown in hiring, against the backdrop of a tighter monetary policy, although still not tight, are hiring rates dropping back to 2018 levels.” Helping to drive the drop in hiring rates is profit growth slowing in Q4. December corporate tax payments to the Federal government dropped from Q3, and payments were below December 2021 levels. Earnings are a key determinant of growth in hiring and wages.”

Let’s take a closer look at the hiring rate which we first touched upon yesterday: In November the private sector hiring rate (which according to the TS Lombard strategist is more meaningful than job openings in terms of identifying cyclical turns) slipped to its 2018 average, along with manufacturing.

Perhaps more telling about the cycle is that the hiring rate for business and professional services is sinking further below its 2018 average. As Blitz explains, when economies drop into recession, sectors are impacted differently and in the coming downturn it is reasonable to presume that the area least effected by the inability to work in person is the one where the downturn hits first and hardest. The hiring rate in accommodation and food services remains high relative to 2018, a function of travel, commuting and otherwise, returning to normal, however slowly.

What about profits? Obviously, profits are critical to the pace of hiring and job gains, and corporate tax receipts at the Treasury – which the BLS can’t seasonally adjust or tamper with for political reasons or otherwise – suggest Q4 was not as good a quarter for earnings. Blitz explains that US firms pay estimates of current year taxes quarterly, and when December falls short it means firms figured they overpaid in September, given what were their full-year earnings expectations at the time.

Well, as shown below, December tax receipts were 1.8% below year-ago levels, compared with 32.5% last year. In September, tax payments were 27.1% above year ago levels, which gave us the signal at the time that quarterly profits would be strong.

As the TS Lombard strategist concludes, “with the fall off in Q4 and the normal lag in hiring relative to earnings, a slower pace of job growth should be expected in the months ahead – as indicated by the drop in the hiring rate…. In sum, the 2022 pace of extraordinary job growth despite record low unemployment is coming to an end. The coming months should see the pace slow towards 150,000, on par with prior late-cycle periods. It is too soon to say this is, in total, precursor to recession, but the sharp drop-off in the hiring rate for business and professional services may be more telling of an impending cyclical turn. Once hiring drops well-enough below 200,000 the Fed’s pace of rate hikes will slip to 25BP and then 0 in short order.”

Authored by Steven Kovac via The Epoch Times (emphasis ours),

Election Watch (EW), a Wisconsin election integrity watchdog organization, has discovered that more than 150,000 votes cast in the 2020 presidential election cannot be connected with a valid address.

EW computer analyst Peter Bernegger said the group’s study of Wisconsin’s voter rolls found 45,000 such occurrences involving people who were living out of state in the Nov. 3 ballot, with another 107,000 documented instances on the part of voters who moved to another address within the state and cast a ballot in a different jurisdiction from the one in which they actually reside.

“That’s over 150,000 votes cast in the 2020 presidential election that cannot be tied to a valid address,” said Bernegger. “That’s illegal in the state of Wisconsin.

“Though there may be a reasonable explanation for most of these, the number of instances is so large that if only two out of 10 were nefariously cast votes, that was enough to tip the election to Biden.”

Former Wisconsin resident Jacob Alldredge, a 27-year-old industrial engineer living in Tennessee, is a case in point.

“I was outraged to learn that the Wisconsin state voter roll shows that I voted in person at the polls on Nov. 3, 2020, when the fact is I was living, registered to vote, and voted in Tennessee. I was not in Wisconsin that day,” he told The Epoch Times.

“The entire situation distresses me because, without election integrity, your vote doesn’t matter,” said Jacob Alldredge.

“We need reform in our voting system. Fixing this is not an impossible task, but I don’t think people want to solve it.”

One person who said she is most certainly dedicated to solving the problems with Wisconsin’s voting system, especially its “sloppy and inflated voter roll,” is Jacob’s mother Sandy Alldredge.

A self-described “constitutional conservative,” Sandy Alldredge told The Epoch Times that in 2020 she was a volunteer working for the reelection of President Donald Trump.

“When Trump ‘lost’ Wisconsin to Joe Biden by 21,000 votes, many patriots began working hard on cyber efforts to find out what really happened. Their dedication inspired me to get involved, so I got some training and made myself available to help.”

Sandy Alldredge said that after learning that some Wisconsin precincts posted a 103 percent voter turnout in the 2020 election; and that there were 7.3 million registered voters in a state with a total population of 5.9 million, she decided to check out the voting records in her former hometown.

Examining the state voter roll for the town of Delavan, in Walworth County, Sandy Alldredge was shocked to see that her son Jacob was listed as having voted in person at the polling place on Nov. 3, 2020—something she knew first-hand to be impossible.

Sandy Alldredge provided The Epoch Times with a spreadsheet from the state voter roll as it appeared on Aug. 18, 2021, as evidence.

“When we checked the poll book, which every in-person voter is required to sign before being allowed to vote, Jacob’s signature was not on it.

“So why does the official Wisconsin Election Commission record say that he voted at the polls on Nov. 3, 2020?” she asked.

Analyst Bernegger said he intends to file a formal complaint over the Alldredge incident “with” Delavan’s municipal clerk, “not against her.”

Who Changed Voter Roll?

“Hardworking and honest local clerks around our state are being played. The municipal clerks are taking the brunt of the questioning by concerned citizens, and they are answering to the best of their knowledge. From their perspective, everything appears normal. The behind-the-scenes reality is far from it.

“I’m listing John Doe as the respondent because we have not yet determined who the cheater is,” he said.

Delavan Town Clerk Michele Starin, who took office in May of 2022, told The Epoch Times she had not received any complaint yet and said she knew nothing about any irregularity with Jacob Alldredge’s voting record.

“According to our records, the last time Mr. Alldredge voted was by absentee ballot in 2016. He is currently listed as inactive,” said Starin.

In a Jan. 3 phone interview with The Epoch Times, Walworth County Clerk Susi Pike said she was not aware of any complaint concerning Jacob Alldredge.

After checking the poll book for the 2020 election, Pike confirmed that Jacob Alldredge did not vote in person at the polls that day.

Pike then checked the state voter roll and said there is no record of Jacob Alldredge voting at all in the 2020 presidential election.

Read more here…

Concerns over plunging home sales leading to a real estate agent exodus could be an emerging trend in 2023. The number of agents has exceeded the peak of the mid-2000s boom, but one real estate consulting firm believes hundreds of thousands of agents could quit and find other jobs as turmoil plagues the interest rate-sensitive industry. 

Nick Gerli, CEO and founder of real estate Reventure Consulting, said, “30% of Realtors will likely quit during this Housing Crash. Once that happens, you’ll know the bottom is approaching.” He posted a chart on Twitter that shows there are currently 1.6 million registered real estate agents — that’s higher than the 2007 bubble. 

Gerli forecasts at least 480,000 agents will exit the industry. He then posted a Home Sales/Total Realtors ratio only to show it’s “even lower than the depths of the 2008 Housing Crash.” This means the number of deals realtors are closing is sliding due to a worsening housing affordability crisis. 

“The Housing Bubble has popped, but the Bubble mentality has NOT. 1.6 Million Realtors are still “holding on,” thinking the Housing Market will improve in 2023,” Gerli said. 

He expects a wave of realtors to “inevitably quit in 2023 … and when they quit, it will likely coincide with investors/flippers/stubborn sellers “quitting” as well.” He added: “And that’s when you’ll see inventory/listings really explode.” 

Gerli reminds everyone this is the “biggest bubble ever in housing.” 

We already pointed out months ago real estate agents should be on the hunt for new jobs as the Federal Reserve’s most aggressive interest rate hikes and quantitative tightening is killing the demand side of the market. And, of course, real estate agents don’t get paid when there are no buyers. There was even a report in October that many realtors couldn’t pay their office rent. 

Realtors who were on top of the world during the easy money times and a housing boom during Covid bought fancy vehicles. Well, that fast money has already evaporated. 

$2,800 monthly payment 🥴 pic.twitter.com/pSTmK73U5q

— CarDealershipGuy (@GuyDealership) December 21, 2022

And if realtors are to leave the industry — don’t worry about learning how to code — perhaps going back to bartending is a viable solution. 

Authored by John Mac Ghlionn via The Epoch Times,

Life is a beach, they say, and we’re all just playing in the sand. Soon, though, there might not be any sand left. That’s because the world is running out of it.

Running out of sand, you ask, how can that be? After all, 33 percent of Earth is covered in desert, and many of these deserts have copious amounts of sand (not all of them, though). Yes, that’s true, but desert sand, like sea sand, lacks the compressive strength needed to construct houses, skyscrapers, roads, and bridges. In other words, when it comes to the world of construction, both desert sand and sea sand are utterly useless. This is why there is a race to secure the limited amounts of appropriate sand available.

Scarcity breeds desperation and this desperation is particularly palpable in China. The Chinese Communist Party (CCP) has deployed “pirates” to raid neighboring countries. In truth, the “pirates” have been plundering and pillaging for years. In recent times, however, they have zeroed in on Taiwan, stripping the island of its valuable deposits.

The world is experiencing a shortage of just about everything: corn, coffee, wheat, soybeans, plastic cardboard, semiconductor chips, suitably qualified workers, etc.

Now, it’s time to add sand, the most-extracted solid material in existence, to this ever-growing, highly-eclectic list. The importance of sand cannot be emphasized enough. Water is the world’s most-consumed natural resource; sand is the second most. Every construction project relies on using sand—the correct type of sand. By 2030, the construction market is expected to be worth $14.4 trillion; two years ago, it was worth $6.4 trillion. We’ll need more sand, but there might not be enough of it to go around.

Demand for sand is soaring, and this demand will likely increase dramatically over the next three to four decades. This brings us to China, a country with a voracious appetite for construction-friendly sand. In many ways, the appetite should come as little surprise; when it comes to constructing roads, bridges, and buildings, China leads the way. In an effort to satisfy its appetite, the CCP is targeting its neighbor, Taiwan.

A tourist sits facing the Taiwan Strait at the 68-nautical-mile scenic spot, one of mainland China’s closest points to Taiwan, in Pingtan Island, Fujian Province, China, on Aug. 5, 2022. (Aly Song/Reuters)

The targeting started back in 2019. In response to the CCP’s attempt to mine the island dry, Taiwan’s coastguard deployed numerous drones and water cannons to deter the invading sand miners. On that occasion, the miner retreated—but not for long. The Chinese “pirates” returned, focusing on the Taiwan-run Matsu Island, an archipelago consisting of 19 islands.

As Foreign Policy’s Elisabeth Braw reported in July 2022, “China is increasing its dredging of sand in the islands’ waters.” Such “devious activity” works to China’s advantage and leaves Taiwan with “large expenses and maritime degradation.” Susumu Takai, president of the Security Strategy Research Institute of Japan, told Braw that China lacks enough sand to continue its construction projects in various Chinese cities.

The Chinese regime doesn’t consider its activity to be illegal. Why? Because, as most readers are aware, the CCP claims Taiwan is part of China.

The CCP’s sheer greed and lack of respect also extend to other parts of Asia. Last year, as Reuters reported, dredgers were spotted off Cambodia’s Ream naval base. Not coincidentally, the dredgers happened to be operating in the very same area where Beijing happens to be funding construction projects and the development of various port facilities. In June 2022, The Washington Post ran a piece on China’s construction of a secret naval base in Cambodia. Sand, it seems, is not the only reason why China is interested in Cambodia.

Just to reiterate: China isn’t the only country scrambling to secure sand. This is a global crisis that affects the United States just as much as it affects China. Although the Chinese regime is likely to continue pillaging and acting with a high degree of impunity, there is hope for the United States.

According to Stanford geographer and environmental scientist Eric Lambin, the United States needn’t fixate too much on the mining process. “Instead of mining unconsolidated sediment deposits,” Lambin urges the government to focus on the crushing of rocks “or by recycling construction and demolition waste such as concrete or masonry.” This is because crushed rock is often considered a superior option, “thanks to better control over mineralogical composition and shape.” Whether or not Lambin’s advice is heeded remains to be seen.

In the meantime, keep an eye out for China’s sand “pirates,” whose hunger for granular deposits is likely to become even more voracious over the coming years.

Tesla’s sales of China-made vehicles fell to a five month low in December, despite China’s passenger vehicle market rebounding, according to new data from the China Passenger Car Association (CPCA) on Thursday. 

Tesla delivered 55,796 vehicles for the month, down 44% from November and 21% from the year prior, Reuters reported, citing “reduced output” and price cuts amidst rising inventories, coupled with slowing demand, as reason for the fall in numbers.

The report notes that the figure is the fewest monthly deliveries in China since July, when the company’s key Shanghai factory purposely suspended operations in order to upgrade its production lines. For the year, however, Tesla delivered about 50% more vehicles produced in Shanghai than in 2021. 

As we have noted, Tesla suspended production at Shanghai from December 24 to January 2 as part of an effort to reduce production and allow demand to catch back up with supply. The company is also expected to suspend production for Chinese New Year later this month. 

The figures come despite the fact that passenger vehicle sales in China rebounded for the month, with the CPCA posting total sales of 2.45 million units for the month, up 15% year over year and 47% month over month. 

Recall, days ago we noted that Tesla broke quarterly delivery records in Q4 2022, but fell short of Wall Street’s estimates. Tesla announced it had delivered a record 405,278 vehicles for the quarter. The number marked a record for the company, but came in below most Wall Street estimates, even some that were revised lower. Consensus estimates for deliveries stood at 420,760 into the report, according to Bloomberg.

“In 2022, vehicle deliveries grew 40% YoY to 1.31 million,” the company’s press release said. This fell short of the 50% growth figure the company had once projected for the year. 

Tesla commented: “We continued to transition towards a more even regional mix of vehicle builds which again led to a further increase in cars in transit at the end of the quarter. Thank you to all of our customers, employees, suppliers, shareholders and supporters who helped us achieve a great 2022 in light of significant COVID and supply chain related challenges throughout the year.”

The breakdown of vehicles included 388,131 Model 3 and Model Y deliveries, which fell short of the 405,597 estimated:

And 17,147 Model S/X deliveries, which fell short of the 18,578 estimate:

Update (1820ET): While we wait on a possible deal for Speaker, get this – the NY Times‘ Mara Gay says that “some” of the anti-McCarthy holdouts were elected “stop the tide of diversity in the country, the browning of America, the fears that surround that.”

So – now opposing McCarthy makes one a racist.

NYT’s @MaraGay: “Some” of the anti-McCarthy holdouts were elected to “stop the tide of diversity in the country, the browning of America, the fears that surround that” pic.twitter.com/sRMPHTqLbT

— Tom Elliott (@tomselliott) January 5, 2023

Care to name which of the 20 holdouts was elected to “stop the tide of diversity” in the country, Mara?

Was this what Joe Rogan meant when he called the NYT ‘corrupt’ and ‘full of shit’?

Update (1730ET): After a 10th failed vote for Speaker, Punchbowl News‘ Jake Sherman reports that a deal between McCarthy and his opponents is ‘close.’

According to Sherman, Reps. Chip Roy and Patrick McHenry have been negotiating, and “All the big players are now in TOM EMMER’s 1st floor office.”

An offer ‘in writing’ is expected by tonight.

🚨 NEW: Sources tell us a deal between MCCARTHY and his opponents is close.

CHIP ROY and PATRICK MCHENRY have been negotiating it

All the big players are now in TOM EMMER’s 1st floor office.

RALPH NORMAN says he expects an offer in writing tonight

w @bresreports/@heatherscope

— Jake Sherman (@JakeSherman) January 5, 2023

Update (1640ET): McCarthy has lost for a ninth time, officially making this the longest speaker’s race since 1859, when it went to 44 ballots. A tenth vote has begun.

As a reminder, House business is frozen until a speaker is elected.

“The Biden administration is going unchecked and there is no oversight of the White House, State Department, Department of Defense, or the intelligence community. We cannot let personal politics place the safety and security of the United States at risk,” wrote the incoming chairs of various committees Thursday morning.

Also stalled is clearance for sensitive and classified information.

“I sit on the House Intelligence Committee. We oversee all 19 intelligence agencies. We are currently offline,” said GOP Rep. Brian Fitzpatrick.

House Rules – which are set with each new Congress – are frozen.

Staff won’t get paid if there isn’t an approved package of House Rules by the end of business on January 13th, according to a letter sent last week by the committee in charge of such matters, CNN reports.

That said, members-elect will still get paid.

Surprised?

According to GOP Rep. Don Bacon of Nebraska, a McCarthy supporter, this process could go on “for a long time.”

“These folks do not know how to get to yes. They’ve been offered every concession, or met every concession. They just don’t know how to get to yes. It’s an embarrassment to them, our party, the House and our country. I think there is totalitarian states out there, look at those 20 and say this is why we don’t want democracy. That’s an embarrassment. … We’re going to be doing this for a long time,” he said, adding that he just came out of a meeting with 80 to 90 ‘Main Street Republicans.’

“We said if you’re not committed to do this to the very end, go ahead and just leave. … But every single one said we’re here until the very end. We cannot allow 20 people to hold us hostage, act as political terrorists. … There is a large group that are in this until the end. And I believe that Kevin McCarthy is not going to back down,” Bacon added.

Further, Bacon said that the group of 20 holdouts will get smaller, and that the GOP may work with Democrats on the process.

“We need to consider at some point how we’re going to work across the aisle if this small group will not cooperate. There is some concessions that the other side will want and there may be some grounds that we can provide a more bipartisan structure this this House and eventually get to 218,” he added.

Meanwhile, the RINOs are pissed:

Crenshaw: “If you always set this precedent where a mere 20 people can just destroy the Conference of over 200, then you’re setting a terrible precedent.” pic.twitter.com/CIQqFrKH5R

— Greg Price (@greg_price11) January 5, 2023

pic.twitter.com/8UbXp3MVCQ

— Doochebag (@MalcolmRenoldz) January 4, 2023

*  *  *

Update (1525ET): The 9th round of voting for House Speaker is now underway, topping the number of ballots it took in 1923 to re-elect Speaker Frederick Gillett (R-MA). He won by eventually caving to several demands to liberalize House legislative rules in order to win over fellow Republicans.

Prior to that, the House was deadlocked for two months in 1856, when it took 133 votes.

“We need to get to a point where we evaluate what life after Kevin McCarthy looks like,” said Rep. Lauren Boebert to the 200 McCarthy supporters, before nominating Kevin Hern.

BOEBERT nominates Kevin Hern. She says she has been accused as having no plan, but they have “many many plans.”

Hern got two votes last time. We’ll see if Boebert sways anyone.

Boebert has voted for several candidates in these last few days.

— Jake Sherman (@JakeSherman) January 5, 2023

Asked at what point will he make a realization that the outcome won’t change, McCarthy told me: “After I win.”

— Manu Raju (@mkraju) January 5, 2023

*  *  *

Update (1455ET): If Kevin McCarthy was a cat, he’d have one life left – after the eighth round of voting for House Speaker has once again left him with snake-eyes.

The results were virtually unchanged from the last round, with McCarthy garnering 201 votes, 20 Republicans voting for another candidate, and one voting “present.”

What’s next?

As of now, lots of uncertainty about what’s next.

Could be 9th ballot

House rs would like to adjourn but don’t think they have the votes.

The leadership operation is trying to turn some votes on adjournment now.

Remember: they have to keep voting if they can’t adjourn

— Jake Sherman (@JakeSherman) January 5, 2023

Rep. Nancy Pelosi (D-CA) told reporters on Wednesday that she wishes McCarthy had been voted in on the first ballot.

“I wish it had happened on the first vote, that Kevin would have been elected on the first vote and then we could have proceeded with putting committees together, an agenda and the rest,” she said. “People should be seeing what the difference public policy makes in their lives instead of their being subjected to, what do they call insanity, doing the same thing over and over again with no change.”

Come on Kevin, aren’t eight votes enough?

*  *  *

Update (1407ET): The House has begun voting for an eighth time, after McCarthy was soundly defeated once again.

After the Seventh vote for Speaker of the House, 21 Republicans are still Holding the Line and voting against Kevin McCarthy.

Since the first vote, those opposing McCarthy have only gained or maintained support.

— Benny Johnson (@bennyjohnson) January 5, 2023

In the last round of voting, 19 Republicans voted for Rep. Byron Donalds, one voted ‘present,’ and Matt Gaetz voted for former President Trump.

Rep. Chip Roy SMOKES McCarthy’s dream of being Speaker like Texas Brisket on live TV pic.twitter.com/EGPDSfgvVz

— Benny Johnson (@bennyjohnson) January 5, 2023

Update (1250ET): To the surprise of no one, Kevin McCarthy doesn’t have the votes to become Speaker of the House as the 7th round of voting comes to a close.

Hilariously, Rep. Matt Gaetz voted for Donald Trump for Speaker.

Representative-elect Gaetz votes for Donald John Trump for Speaker of the House. pic.twitter.com/zvAIH4tujZ

— The Republican Accountability Project (@AccountableGOP) January 5, 2023

Interestingly, Trump could become Speaker – as the Constitution does not specify that the Speaker must actually be a member of the House. In a 2021 report, the Congressional Research Service noted that “Although the Constitution does not so require, the Speaker has always been a Member of the House.

*  *  *

After two days of embarrassing defeat spanning six votes for Speaker of the House, Kevin McCarthy has offered his critics a mountain of new concessions before, during and after a round of Wednesday night negotiations, Politico reports.

The concessions include (via Politico): 

• A one-member “motion to vacate”: The GOP leader appears to have finally acquiesced to a demand to lower the threshold needed to force a vote ousting a speaker to just one member. While McCarthy originally indicated that restoring the one-member “motion to vacate” was a red line, his allies now argue that there’s not a huge practical difference between this and his previous offer of requiring five members to trigger the vote.

• Rules Committee seats for the Freedom Caucus: McCarthy is prepared to give the House Freedom Caucus two seats on the powerful House Rules Committee, which oversees the amendment process for the floor. (Some conservatives are still holding out for four seats on the panel.) There are also talks about giving a third seat to a conservative close to the Freedom Caucus but not in it — someone like Rep. Thomas Massie of Kentucky. Who would pick those members is still under discussion. Typically, it’s the speaker’s prerogative, but conservatives want to choose their own members for these jobs.
• A vote on term limits: This is a key demand of Rep. Ralph Norman (R-S.C.), who has proposed a constitutional amendment limiting lawmakers to three terms in the House.

• Major changes to the appropriations process: Fears of another trillion-plus-dollar omnibus spending bill have been a major driver of the conservative backlash to McCarthy. The brewing deal includes a promise for standalone votes on each of the 12 annual appropriations bills, which would be considered under what is known as an “open rule,” allowing floor amendments to be offered by any lawmaker.

That said, according to Punchbowl News‘ Jake Sherman (formerly of Politico), there are still 20 ‘no’ votes against McCarthy, who “may have to sit through a 7th speaker vote today that he’s sure to lose.”

According to Sherman, “negotiations between McCarthy and opponents have turned slightly positive,” while the Speaker hopeful is trying to drive a wedge between Reps. Lauren Bobert and Matt Gaetz. That said, some of McCarthy’s allies have suggested the drama could extend into next week before McCarthy either gets the job or backs down.

More from Sherman / Punchbowl regarding McCarthy’s progress:

TO BE SURE: MCCARTHY is a long way away. but he finally had a sliver of good news yesterday

— Jake Sherman (@JakeSherman) January 5, 2023

Meanwhile, ‘Never Kevin’ Rep. Dan Bishop (R-NC) has vowed to resign from Congress if McCarthy is elected Speaker, Fox News reports.

Years of anger, distrust

As Bloomberg notes, the 20 GOP holdouts that are blocking McCarthy’s bid to become Speaker comes from years of anger at party leadership and “deep suspicions of the veteran lawmaker.”

The group opposing McCarthy’s ascension to the top spot in the chamber have a list of grievances about House rules, anger over uniparty compromises with Democrats, and doubt over McCarthy’s claim to be a true conservative.

“Mr. McCarthy has a history that is off-putting to some people,” said Rep. Andy Biggs (R-AZ), one of the leaders of the revolt.

According to Rep. Scott Perry, chair of the conservative House Freedom Caucus, “It’s not personal for us,” adding “It’s about the policies that come out of here.”

“I’m not for the restrictive nature of this place where eight people run it and the rest of us just vote yes or no,” Perry added, expressing frustration with a series of omnibus spending packages that Republicans have joined Democrats in jamming through the process, year after year.

Meanwhile, McCarthy foe Rep. Ralph Norman (R-SC) says there are ‘trust’ issues over McCarthy’s past votes on spending packages.

“Could Kevin McCarthy all of a sudden morph into a fiscal conservative?” he asked.

Matt Gaetz of Florida, one of McCarthy’s most vocal detractors, has made his opposition more personal, lambasting him as a creature of the Washington “swamp” who does the bidding of corporate lobbies.

“If you want to Drain the Swamp, you CANNOT put the biggest alligator in charge of the exercise!” he said in a fundraising email sent amid the speaker votes. “We’re talking about someone who the corrupt DC special interests can always count on to be their lapdog.”

McCarthy has made efforts to neutralize right-wing critics. He pulled himself close to former President Donald Trump after first criticizing him for his actions when a mob of his supporters stormed the Capitol on Jan. 6, 2021. -Bloomberg

Stay tuned for today’s episode of ‘nobody likes Kevin.’

By Tsvetana Paraskova of OilPrice.com,

Saudi Arabia, the world’s top crude oil exporter, on Thursday cut the prices of all its crude grades loading for Asia in February to the lowest level to regional benchmarks in more than a year, as demand concerns continue to prevail.

Saudi Aramco, the state oil giant, cut the official selling price (OSPs) of its flagship crude grade, Arab Light, to Asia for February by $1.45 per barrel, setting the price at $1.80 a barrel above the Dubai/Oman benchmark. The premium to the Dubai/Oman average is the lowest since November 2021, but it was generally in line with expectations.

Earlier this week, a Reuters survey of analysts showed that Saudi Aramco was widely expected to cut its OSPs to Asia for February, following a cut for the January loadings to a 10-month-low.

Last month, Saudi Arabia cut the price of the crude it would sell to Asia in January to a 10-month low versus the regional benchmarks, which had weakened amid signs of lackluster demand in the world’s most important oil-importing market.    

The forecasts in the Reuters survey were in line with the actual cut announced today—analysts had expected the price of the Arab Light crude grade to be cut by $1.50 per barrel for February shipments to a premium of just $1.75 per barrel over Dubai/Oman.

Aramco, which generally doesn’t comment on the OSPs, also lowered the prices of its crude loading in February to northwest Europe and the Mediterranean region, while prices for the U.S. remained unchanged.

The cut in Saudi oil prices isn’t a surprise for the market or analysts, considering the growing concerns about immediate demand in China and the world. Oil prices had the worst start to a year in more than 30 years after tumbling by 9% in just two days.

Authored by Alex Timothy via The Post Millennial,

Canada set a new immigration record for 2022, welcoming more than 430,000 newcomers into the country, Trudeau’s Minister of Immigration, Refugees and Citizenship, Sean Fraser, said on Tuesday.

Ottawa intended to welcome 431,645, a goal that has been reached, surpassing the previous year’s record of more than 401,000 immigrants.”Today marks an important milestone for Canada, setting a new record for newcomers welcomed in a single year,” Fraser said. “It is a testament to the strength and resilience of our country and its people.”

Immigration, Refugees and Citizenship Canada (IRCC) processed approximately 5.2 million permanent residency applications in 2022, more than double the number from 2021.

Canada’s goal for 2023 is 465,000 immigrants, increasing to 485,000 in 2024, then 500,000 in 2025, with an emphasis to be placed on skilled workers.

To help facilitate this steady increase, the Trudeau government’s fall budget committed an additional $50 million to the IRCC for the 2022-23 fiscal year in order to “address ongoing application backlogs, speed up processing, and allow skilled newcomers to fill critical labour gaps faster.”

“Newcomers play an essential role in filling labour shortages, bringing new perspectives and talents to our communities, and enriching our society as a whole,” Fraser said. “I am excited to see what the future holds and look forward to another historic year in 2023 as we continue to welcome newcomers.”

The Liberals cited immigration as the reason for Canada having “experienced one of the fastest recoveries from the pandemic,” adding that the acute labour shortages the country is facing will be helped by immigration.

“We know there is over a million jobs in Canada that remain unfilled, so we need immigrants, skilled immigrants, to come in and help us fill those unfilled jobs and help us grow our economy,” Housing Minister Ahmed Hussen told Global News. “In addition to that, the irony is we actually need more people, skilled immigrants, to also help us in the building trades and the construction sector of our economy.”

“We need those workers to actually come in and help us build the housing that Canadians need,” he added.

The massive cost (and fat) cutting at Twitter under micromanaging new CEO Elon Musk continues. 

For years Twitter had operated less like a company and more like a cult compound for leftist ideologues, with free lunches, yoga rooms, smoothie, wine and espresso bars, and minimal work buffered by pointless meetings and near zero productivity.

Those days appear to be over. The latest proof? Twitter laid off “about 40 data scientists and engineers working on the advertising team” late on Wednesday night of this week, according to The Information.

A person with direct knowledge of the matter said that the layoffs now leave the company with “few engineers” working on “machine learning for ad optimization”.

These cuts come after additional reports this week that Elon Musk would be, among other things, downsizing the company’s San Francisco headquarters from six floors to only two. 

Musk has also been systematically releasing internal communications from the company confirming that it was working with intelligence agencies to censor users. He has promised a forthcoming “Fauci Files” disclosure of more additional internal documents slated for this week. 

Back in November, we wrote about how Musk was purging thousands of Twitter employees as he sought to turn around the struggling technology company. As we noted then, alleged leaks from within the company suggested that most employees under previous management barely worked and were devout “communists” with a hatred of free speech. The leaks also claimed that Twitter employees were far more concerned with censoring conservative voices than doing their jobs. 

We noted then that Musk had fired at least 3500 primary staff members and purged at least 4500 outside contractors, many of them moderators tasked with filtering “misinformation”.  Interestingly, Twitter users have not noticed much of a difference in terms of functionality for the platform despite the mass layoffs. 

We said it then and we’ll say it again: the only difference has been the ability to speak more freely on the platform. 

Yesterday we listed some of the best and worst performing hedge funds of 2022: we missed the most important one.

After a stellar 2021, when it generated $16.2 billion in revenue, in 2022 Ken Griffen’s Citadel hedge fund – which had $54.5 billion in AUM as of Jan 1 – had a blowout year, and according to the WSJ, it generated about $28 billion in revenue, citing sources. It wasn’t immediately clear what exactly is meant by “revenue” here: new funds, services rendered, or unbooked and booked gains, but whatever it is, the number is a lot, and follows an impressive 38.1% return at the company’s flagship multi-strategy fund, Wellington. It also far outstripped the hedge fund’s prior record of $16.2 billion the year before.

Additionally, Citadel Securities, a separate entity and one of the world’s biggest electronic-trading firms, had $7.5 billion in revenue, also up from the prior record of $7 billion in 2021. Although in a market where there has been virtually no “lit” (or exchange liquidity) and where most trades have gone through internalizers like Citadel, this particular success is easier to comprehend.

And yes, those pointing out that companies which control both a hedge fund and a trading operation are not that different from SBF’s empire, which consisted for the FTX exchange and the Alameda hedge fund, are not too far off.

As the WSJ recounts, after its near-death experience in 2008, Citadel has outpaced many rivals in recent years, and each of its hedge funds posted double-digit gains after fees in 2022. Operating under tight risk controls that leave Citadel with little directional exposure to markets, the firm’s 1,000-plus traders make bets across asset classes in markets around the world. The firm doesn’t provide detailed information to clients about significant trades, though earlier in the year it told them it had benefited from successful commodities bets.

As for Citadel Securities, regular readers are quite familiar with it (not lease because of their threat to sue Zerohedge for suggesting it was frontrunning client orderflow just days before securities regulator FINRA accused it of doing just that) as a global market-making operation that handles more than 20% of the shares that change hands in U.S. stock markets each day. The business, which also trades futures, options, Treasuries and currencies, benefits from increased volumes and volatility, as well as reduced liquidity allowing it to pocket huge bid/ask spreads and prosper even when markets fall.

Furthermore, the pandemic-era boom in activity by retail investors benefited Citadel Securities’ so-called retail-wholesaler unit, which executes orders for brokerages such Robinhood and, to a lesser extent, Schwab.

The revenue bonanza will add to Griffen’s already considerable fortune who in addition to regularly breaking records in the real-estate and art markets, has emerged as a major GOP donor. Forbes estimates his wealth at around $31 billion.

To be sure, most other hedge funds have had a rougher year. As we noted yesterday, Goldman told its prime-brokerage clients that hedge funds betting on and against stocks lost an average 12.9% for the year, on an asset-weighted basis, while the S&P 500 lost about 18% including dividends.

Citadel’s flagship multi-strategy fund, Wellington, returned 38.1% by contrast. Previous reports from the WSJ revealed that commodities made up more than 60% of the second-quarter gross investment gains for Wellington.

But even more remarkably, all of Citadel’s five strategies—fixed income and macro, commodities, equities, quant and credit—were profitable for the year, according to WSJ sources. That was evident in the returns of its three other hedge funds, which notched gains of more than 20%. One of the funds, Citadel Equities, was up 21.4% for the year. Unable to keep up with its newfound wealth, Citadel returned about $8.5 billion in profits to its investors Dec. 31, up from the $7 billion it earlier expected.

Rivals Millennium Management and Point72 Asset Management gained 12.4% and 11.8% for the year, respectively. D.E. Shaw Group’s flagship multi-strategy fund, Composite, returned about 24.7%.