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Cliffwater Private Credit Fund Gates Investors For Second Straight Quarter After Redemption Requests Soar To 17%

Cliffwater Private Credit Fund Gates Investors For Second Straight Quarter After Redemption Requests Soar To 17%

The market may be in full-blown face-ripping bubble mode, and software stocks are now gripped in by a category 5 gamma squeeze hurricane, but not even that is helping the ongoing debacle that is private credit.

The flagship private credit fund of Cliffwater, a fund which has was slammed by redemption requests in the past quarter as the private credit crisis came to a fore, has again gated investors by capping redemptions at 5% in the second quarter after investors looked to pull more than three times that amount, or 17% of shares, Bloomberg reported, in a sign of relentless pressure on the $1.8 trillion market.

The $31 billion Cliffwater Corporate Lending Fund informed shareholders Tuesday that they’d get about one-third of their requested money back, according to a letter seen by Bloomberg. The prior quarter, investors got back around half of the roughly 14% they asked for, with the vehicle choosing to cap withdrawals at 7%.

Shortly after Cliffwater’s decision in March, S&P Global Ratings lowered its outlook on the interval fund to negative from stable, warning that the 5% redemption threshold is “an important guardrail.”

“Our repurchase program is intentionally designed to provide shareholders with periodic liquidity that aligns with the fund’s long-term investment strategy and its underlying assets,” Cliffwater CEI Stephen Nesbitt said in the letter to investors. And by periodic liquidity he meant far less liquidity than investors hoped to recovery. 

The firm previously said that the fund, which has delivered a roughly 9.4% annualized net return since it was formed in 2019, has enough liquidity to meet 5% redemptions for more than a year without selling a position or an asset. After a second straight quarter of gating that may be tested very soon.

Cliffwater has become something of an unlikely giant in the private credit market by raising money at a rapid clip and deploying it across both direct loans and funds that do such lending themselves. Other non-traded business development companies are set to report the results of their second-quarter tender offers in the coming weeks. In the previous period, some like Blackstone’s BCRED went to extraordinary lengths to let investors cash out (all for nothing as the looming redemption flood will overrun even the giant fund), while other funds at Apollo Global, BlackRock and Blue Owl enforced their 5% caps.

Tyler Durden
Tue, 06/02/2026 – 22:44

Feds Seize Over A Ton Of Cocaine At Massive US-Mexico Drug-Smuggling Tunnel

Feds Seize Over A Ton Of Cocaine At Massive US-Mexico Drug-Smuggling Tunnel

Authored by Jill McLaughlin via The Epoch Times,

Authorities charged four suspects on June 1 with felony drug distribution violations after finding a hidden tunnel used by drug runners inside a retail store in San Diego County that led into Tijuana, Mexico.

Investigators also seized more than a ton of cocaine worth about $45 million in connection with the subterranean tunnel, according to the U.S. Attorney’s Office and the U.S. Homeland Security’s Tunnel Task Force in charge of the operation.

“For these defendants, it wasn’t a light at the end of the tunnel. It was lights and sirens,” said U.S. Attorney Adam Gordon.

Federal agents with the tunnel task force started surveilling a Buy 4 Less warehouse on the 2400 block of Roll Drive in San Diego in late December 2025 after they became alerted to suspicious activity at the location, according to prosecutors.

A group of seven or eight “employees” at the Buy 4 Less showed up regularly at the store, but very few customers were seen coming in and out of the location, investigators said.

The supposed employees were seen taking multiple suitcases out of the store and into vehicles or walking the suitcases, which appeared to be empty, across the border into Mexico, according to the court complaint.

Investigators say that on May 29, a man loaded three large, heavy items into a white van that left the warehouse and parked on a street near a mechanic shop. Another man on a bicycle was seen looking around and into parked cars, allegedly conducting counter-surveillance for the van, investigators said.

Federal agents watched as people removed three deep freezers from the first van and placed them into the bed of another truck, then load the deep freezers with packages, according to court documents.

After the vans were loaded onto a truck, the truck left and parked a short distance away. Another man took the truck keys and drove away.

San Diego County Sheriff’s deputies with a K9 police dog stopped the truck and were alerted to the presence of a controlled substance by the canine officer.

After the traffic stop, the agents watching the warehouse saw two other men take heavy boxes out of the Buy 4 Less and load them onto a second truck, which was then driven away. Another sheriff’s deputy with a police canine stopped the second truck.

The traffic stops led federal agents to discover 851 packages of cocaine with a combined weight of more than 1 ton inside the two trucks and van.

The subterranean passageway, stretching from Tijuana, Mexico, to the purported retail store near the Otay Mesa Port of Entry known as “Buy 4 Less,” shown in this photo, is estimated to be about 1,933 feet long, 55 feet deep, and 4.5 feet in height, with a ventilation system and electricity. U.S. Department of Justice

The drug seizures also allowed federal investigators to obtain a signed judicial warrant to search the Buy 4 Less, where they found the exit point of the subterranean tunnel hidden beneath the floor of a storage room inside the store, according to the U.S. Attorney’s Office in San Diego.

The tunnel is about 55 feet deep and extends about 1,064 feet from the Buy 4 Less to the U.S.–Mexico border. Agents estimate it continues another 800 feet to another entry point in Mexico.

The tunnel was accessed using a sophisticated hydraulic lift and was equipped with ventilation and electricity, and was up to 4.5 feet tall in some areas, according to investigators.

Trucks coming from Mexico enter the United States at an inspection station after crossing the border in Otay Mesa, Calif., on April 1, 2025. Sandy Huffaker/AFP via Getty Images

The drug bust and tunnel discovery are expected to impact the cartel’s drug pipeline into California.

“This investigation and seizure represent a significant blow to the Jalisco New Generation Cartel,” said Acting Special Agent in Charge for Homeland Security Investigations in San Diego Kevin Murphy.

Charged in the case were Gregorio Epifanio Hernandez Lopez, 29, of San Diego; Brandon Escalante Sandoval, 26, of Mexico; Jose Jimenez, 32, of San Diego; and Antonio Cortez, 18, of Mexico.

Hernandez Lopez is charged with conspiracy to use a cross-border tunnel and conspiracy to import controlled substances. All defendants are charged with conspiracy to distribute controlled substances.

The U.S. Attorney’s Office in San Diego said the tunnel is one of 99 discovered in the Southern District of California since 1993 and the first since 2022.

Tyler Durden
Tue, 06/02/2026 – 22:35

Do We Really Believe In Freedom?

Do We Really Believe In Freedom?

Authored by Mollie Engelhart via The Epoch Times,

Do we really believe in freedom?

Or do we only believe in freedom when it applies to people who agree with us?

Do we trust people we fundamentally disagree with to remain free citizens?

Or do we believe they must be controlled through laws, censorship, surveillance, or social pressure because they are too dangerous to be trusted with liberty?

That question sits at the center of what I am most interested in during this moment in history, the 250th year of the American experiment.

Because when I look around, it increasingly feels like both sides are drifting in the same direction while packaging it differently.

Each side frames the other as dangerous, radical, and incapable of self-governance. People on the left often believe the right is racist, authoritarian, anti-science, and driven by extremism. Many people on the right believe the left is hostile to faith, hostile to biology, hostile to free speech, and willing to use institutions to socially engineer society.

If you genuinely believe those things about your political opponents, then freedom starts to feel dangerous.

And once freedom feels dangerous, control starts to feel justified.

For me, the COVID-19 pandemic broke the illusion.

I suddenly realized I could no longer clearly see what the political left still offered someone like me. I watched censorship expand rapidly. I watched speech become conditional. I watched people lose jobs and platforms for asking questions. I watched mandates imposed alongside liability protections and dissent treated as danger.

I watched mandates destroy livelihoods.

I watched small businesses close while major corporations consolidated wealth and power. I watched people who had spent decades building restaurants, gyms, farms, salons, and family businesses suddenly deemed “nonessential.”

I wasn’t reading about these policies. I was living under them.

At the same time, I was living in a state that increasingly felt hostile to the practical realities of my life. Everything started feeling harder. More permits. More taxes. More hoops. More social pressure. It felt harder to make a living, harder to farm, harder to build, harder to protect my family, and harder to simply live outside institutional approval.

Socially, it also became harder to honestly say what I believed without risking professional or personal consequences.

This week, I heard arguments celebrating the fact that Democrats overwhelmingly voted against liability protections for chemical companies accused of poisoning Americans. Many people presented that as evidence that one side cares about ordinary people while the other protects corporations from accountability.

But that moral high ground becomes more complicated when you remember that many of those same political voices supported mandating a vaccine under an emergency authorization, with liability protections already built into the system. At the same time, dissent around those policies was aggressively silenced.

And the reality is that we are still learning about the long-term effects, trade-offs, and consequences years later.

That is not a conspiracy theory.

That is simply how medicine and biology work. Scientific understanding evolves over time.

The George Floyd era accelerated another version of this same instinct.

Suddenly, institutions across America were pressured to publicly demonstrate ideological “purity” around race, gender, identity, and social justice. Diversity, equity, Indigenous representation, and LGBTQ+ inclusion became not just social values but institutional litmus tests in many professional environments.

In some cases, executives, journalists, professors, and employees lost their positions not because they had committed crimes or acts of hatred, but because they failed to meet ideological expectations during a moment of intense cultural pressure.

And once again, people became afraid to say the wrong thing out loud.

But now I watch similar instincts emerge from the political right under different circumstances.

There are increasingly subjects people feel afraid to discuss openly because they fear losing jobs, reputations, platforms, or financial access. Concerns about extremism, hate speech, anti-Semitism, immigration, terrorism, and national security are all increasingly used to justify expanded speech restrictions and surveillance powers.

And to be fair, some of those fears are real.

But history shows that societies rarely surrender freedom all at once. Usually, it happens piece by piece, each side justifying control because they believe the other side is simply too dangerous to remain fully free.

Many people argued I should have stayed and fought politically where I was. But I didn’t.

I moved to Central Texas. Honestly, I needed to breathe a little.

And yet, even now, as I watch the country continue to fracture, I try very hard not to become tribal myself. I try to zoom out and see the bigger picture.

At the core of it, I still believe in freedom.

But that realization leads me to an uncomfortable conclusion: If I truly believe in freedom, then I have to believe the people around me deserve freedom, too—even when I deeply disagree with them.

Otherwise, what I’m actually asking for is not freedom, but power for my side and restriction for theirs.

Maybe the real test of a free society is not whether we support freedom for people we agree with.

Maybe the real test is whether we still support it when we don’t agree with each other.

Views expressed in this article are opinions of the author and do not necessarily reflect the views of The Epoch Times or ZeroHedge.

Tyler Durden
Tue, 06/02/2026 – 21:45

Leftists Try To “Cancel” Giants Quarterback For His Appearance At Trump Rally

Leftists Try To “Cancel” Giants Quarterback For His Appearance At Trump Rally

Leftists often claim that when someone of celebrity status appears with Donald Trump, it gives Trump “legitimacy.”  This is the common rationale they use to justify their insane cult-like behavior – Their habit of using mobs of mindless activist zombies in order to frighten people with status away from openly identifying as conservative.  The truth is, the political left is a paper tiger, an astroturf movement with no power, blustering with false bravado.   

In reality, celebrities do not give Trump legitimacy.  His landslide election victory gives him legitimacy.  

The radical left is a one trick pony, constantly repeating the same lies and exaggerations in the belief that if they lie long enough those lies will eventually become part of the popular zeitgeist.  For example, a white sports star has a positive interaction with Trump and the progressive media conjures a narrative that he is alienating his minority team mates because shaking hands with Trump is the same as shaking hands with “racism.”

This tiresome strategy is being used once again on New York Giants quarterback Jaxson Dart after he appeared on stage with Trump at a New York political rally.  Leftist journalists assert that Dart shaking hands with Trump is the same as shaking hands with Hitler.  The engineered controversy led to a couple of the QB’s teammates expressing discomfort over the event. 

Thankfully, the opinions of Dart’s teammates are meaningless and he has every right to stand on stage with whoever he pleases.  At present, it seems as though other Giants players understand that they don’t have to align politically in order to play a football game. 

Linebacker Abdul Carter (a Muslim) initially voiced discomfort with the optics of the event, according to multiple reports. Dart said he discussed the issue directly with Carter and brushed off any rumors about beef between the two players.  For those who don’t like Dart’s promotional appearances, frankly they can shut up and stew in their salty snowflake juices about it.

The media, though, is never going to shut up about it because their job is to create controversy out of thin air.

  

Some outlets think Dart needs to be cancelled (as if the political left has any power to cancel anyone anymore).  Sports media site SB Nation claims that Dart’s freedom to meet publicly with Trump does not mean he has the freedom to avoid “criticism” (persecution).  It’s the same incessant woke argument of “cancel culture vs consequence culture.” 

Their version of events displays an insufferable seething; something that might have been more familiar back in 2020.  One has to wonder, do these people ever grow out of their childish delusions of grandeur?  And the answer is no, no they do not.  But we still examine such left-wing crash-outs because they give us insight into the thought processes of progressive authoritarians.  As SB Nation asserts:

“Freedom is pretty great, isn’t it? Here in the United States we love to talk about freedom. The people who love to talk about it the most, who bathe in the idea of American exceptionalism, tend to be those who rarely (if ever) travel abroad. They love to speak about the world in platitudes, always through the lens that the God-loving USA is free, and nowhere else is.  It’s a refrain the majority of Western foreigners find hilarious. Folks in the U.K? They’re free. Europe? Free as well. Australia, Canada, New Zealand — yeah, they’re free.

There are 20 nations broadly recognized as having freedom of expression, with the USA ranking third behind Denmark and Norway. Sure, all those nations might not let you brandish a firearm in public or hurl hate speech at people — but denying that doesn’t make them “un-free.””

Yes, it does make those countries unfree.  If any viewpoints including the truth can be labeled “hate speech”, then the populace does not have free speech.  If the government can put people in prison over jokes and online memes, then those people are not free.  In the UK, around 12,000 people each year are arrested for using restricted speech online.  Most of these arrests are for basic and factual criticisms relating to mass immigration and migrant crime. 

This is not freedom.  

The US is the only country in the world with freedom of speech codified into constitutional law.  It is the only country in the world where the government is restricted from making laws referencing public speech.  SB Nation uses their false narrative of “speech vs hate speech” to launch into their attack on Jaxson Dart.  This is how these people rationalize their totalitarian behavior.  SB Nation continues:

“We’re having this discussion on a sports website because sports are, and always have been, inherently political. It’s impossible to divorce the two, as much as you might want them to be separate…”

For the political left, everything is political.  From movies to TV shows to commercials to video games to comic books to beauty pageants to sports.  Leftist activists believe they should control the platforms of famous people and exploit those platforms for propaganda.  When a celebrity steps out of line, the struggle session begins. 

During the Biden Administration normal people could not escape left-wing politics because they injected their woke ideology into everything.  Sports are not political in the slightest, but progressive movements have tried to force wokeness into them at every turn. 

“Dart made a choice by grinning on stage with the sitting president, one who happens to be historically unpopular, the most divisive in modern history, and largely reviled in both New York and New Jersey, the states the New York Giants represent.

Dart was absolutely free to introduce Trump, he’s free to support him – and personally, I don’t want to see him lose his job for exercising his freedom.  That crucially doesn’t mean Dart should be free of any criticism or allowed to dance away from his decision…”   

A classic woke deflection: “We don’t want to see this man cancelled, but he should be cancelled…”  At no point do the people at SBN explain why it’s a bad thing for a Giants QB to meet with Donald Trump, other than leftists in New York “don’t like Trump” and they think Trump is vaguely racist, even though they can’t come up with a single legitimate example of racism. 

“Dart has spoken as well, but limited his remarks on the appearance to a pre-written statement and has not taken any questions. Even in an instance where a white athlete started the drama, it’s become incumbent upon his black teammates to answer the lion’s share of questions about their teammate. Unfortunately, this is par for the course…”

Trump’s policies have nothing to do with Jaxson Dart.  The man is not political and his views are not up for scrutiny simply because he likes a President that leftists hate.  Jaxson Dart does not answer to The View.  He does not answer to SB Nation.  He does not have to answer to his teammates, and his teammates don’t have to answer to the media. 

As much as the activist mob might want to make Dart pay for escaping the liberal plantation, none of them has the power to do anything to him.  There comes a point when leftists need to accept that they are impotent.  Their cancel culture heyday is long gone and the culture of sane normality is leaving them far behind.      

Tyler Durden
Tue, 06/02/2026 – 21:20

High-Dose Vitamin D Lowers Diabetes Risk In Some People

High-Dose Vitamin D Lowers Diabetes Risk In Some People

Authored by George Citroner via The Epoch Times,

A specific variation in the vitamin D receptor gene may determine whether high-dose supplementation lowers diabetes risk in prediabetic people.

Illustration by The Epoch Times, Shutterstock

Nearly 115 million Americans are on the road to diabetes. New research suggests an inexpensive, widely available supplement could slow that journey, but only for some of them.

A genetic quirk in roughly 70 percent of prediabetic adults may determine whether high-dose vitamin D can meaningfully lower their risk of developing Type 2 diabetes, according to a study published in JAMA Network Open.

The research builds on the D2d trial. More than 2,000 U.S. adults living with prediabetes were randomized to either take 4,000 units of vitamin D or a placebo for up to 3.5 years. Initially, the trial did not find any significant changes across the participants. The recommended daily allowance is 600 to 800 units for average adults.

However, when scientists analyzed participants’ DNA, a more nuanced picture emerged: those carrying specific variations – known as AC or CC – in a gene called ApaI responded strongly to supplementation. Over the 3.5 years of the study, participants carrying the AC or CC variant had a 19 percent lower chance of developing diabetes. The roughly 30 percent with the AA variation saw no benefit at all.

“Diabetes has so many serious complications that develop slowly over years,” study lead researcher Bess Dawson-Hughes said in a statement. “If we can delay the time a person spends living with diabetes, we can reduce some of those harmful side effects or lessen their severity.”

The distinction matters because prediabetes – defined by higher-than-normal blood sugar that hasn’t yet crossed into diabetes territory – affects more than two in five U.S. adults, and often progresses silently. Identifying who stands to benefit from vitamin D intervention could allow clinicians to target supplementation far more precisely than current blanket guidelines allow.

1 Gene Affects How Your Body Responds To Vitamin D

Vitamin D in the blood is converted into its active form in the body. Vitamin D receptors are highly prevalent and present in many cells throughout the body.

When vitamin D binds to cell receptors, it helps cells do what they are supposed to do. In pancreatic cells, vitamin D facilitates the release of insulin to regulate blood sugar.

People with the AC and CC variations were responsive to vitamin D and, therefore, derived more benefits from supplementation.

* * * 

[ZH: We sell high-dose Vitamin D + K2, which massively helps with calcium absorption. Pick some up here.]

* * *

The findings could help develop a personalized approach to preventing Type 2 diabetes, senior author Anastassios Pittas, a professor at Tufts University School of Medicine, said in the statement. “Part of what makes vitamin D appealing as a potential preventive tool is that it is inexpensive, widely available, and easy for people to take.”

However, researchers emphasized that more research is needed to determine which individuals might benefit from higher doses of vitamin D, with Dawson-Hughes noting that future testing could involve a simple, affordable genetic test to identify those most likely to benefit from supplementation.

Recommendations For Vitamin D Levels

The first step is to have your 25-hydroxyvitamin D level tested, Diana Cusa, senior registered dietitian at Plainview Hospital in New York, and not involved in the study, told The Epoch Times.

“If your levels are found to be deficient, you may consider supplementation and review your dietary intake and sun exposure habits,” she said.

Cusa recommended that those who choose supplements should take 600 to 800 international units (IU) daily of vitamin D3 for general health. “Higher doses may be needed if a deficiency is noted or for any targeted prevention trials,” she added.

Current guidelines recommend 600 IU per day for people up to 70 years of age and 800 IU for those older than 70. Excessive vitamin D intake can be harmful and has been linked to increased risks of falls and fractures among older adults.

Sunlight, Cusa pointed out, is one of the most effective natural sources of vitamin D, and spending time outdoors can help boost your levels. “However, it’s important to be cautious – not to spend too long in the sun without proper sunscreen, as excessive exposure increases the risk of skin cancer,” she cautioned.

While you cannot overdose on vitamin D from sun exposure, she added, taking high-dose supplements can lead to toxicity, “so supplementation should be approached carefully and ideally under medical guidance.”

Natural sources of vitamin D include fatty fish such as salmon, tuna, mackerel, sardines, and rainbow trout. Other good sources are beef liver, mushrooms, egg yolks, and cod liver oil. “These foods, which are rich in protein and healthy fats, can help support stable blood glucose levels when consumed in moderation,” Cusa said.

Tyler Durden
Tue, 06/02/2026 – 20:55

US Treasury Sanctions Iran’s Largest Crypto Exchange

US Treasury Sanctions Iran’s Largest Crypto Exchange

Peace talks appear stalled, or even halted completely – despite President Trump’s denials – and the US Department of Treasury is still swinging hard, as part of the ongoing effort to bring about economic collapse in Iran and ‘solve’ the Hormuz Strait shipping crisis.

In the latest installment of Washington’s economic whac-a-mole, the US on Tuesday unveiled sanctions on Iran’s biggest cryptocurrency exchange – and several others, for allegedly enabling the Iranian government and blacklisted state institutions to thwart US and EU sanctions.

The largest platform, identified as Nobitex, is believed to have assisted in allowing hundreds of millions of dollars to pour into Iran’s central bank and the ⁠Islamic Revolutionary Guard Corps (IRGC), as a sanctions work-around and parallel financial system.

via Shutterstock 

“While Iran’s economy is in free ⁠fall, the regime has chosen to co-opt digital asset technologies for its own corrupt agenda, including evading sanctions and transferring wealth out of the country,” Treasury Secretary Scott Bessent stated in announcing the new action.

“Following the commencement of U.S. combat operations in Iran, Nobitex played a role in protecting and moving assets and funds out of Iran to shield regime ‌wealth despite ​internet blackouts,” the statement added.

Nobitex rejected that it has direct government connections and denied that it has been assisting state institutions. It also said it did nothing to conceal the identities of the owners.

As for ownership, Reuters has documented:

Nobitex is controlled by two brothers from one of Iran’s most ​powerful families, with close ‌ties to the new supreme leader. The two are members of the Kharrazi family, one of the most influential dynasties ‌in the Islamic Republic. Corporate records show that when the exchange started, the brothers were listed under a surname rarely used by members of the family.

The brothers were named by the Treasury as Seyed Mohammad ‌Ali Aghamir Mohammad Ali ⁠and Seyed Mohammad Aghamir Mohammad Ali, who were also subject to individual sanctions, along with the exchange’s chief executive officer, Amir ⁠Hossein Rad.

Last Friday Bessent detailed how the US has seized a total of $1 billion in Iranian cryptocurrency assets to date as part of the economic component of President Trump’s Operation Epic Fury.

During a speech before the Reagan National Economic Forum, Bessent stated:

“Just outright grabbed the wallets. Some of them may be typing in right now and might not realize their wallet had been grabbed.”

Assets are held “on behalf of the Iranian people” – he described, while framing that the Iranian government had ‘stolen’ the money from the Iranian populace.

Did this action help fuel BTC’s crashing well below $68K on Tuesday?

As we’ve featured before, for ordinary Iranians – roughly one in six of the population – crypto served as a vital lifeline. Facing relentless rial depreciation (down nearly 90 percent since 2018), chronic inflation of 40 to 50 percent, and frequent power blackouts or internet shutdowns during protests, citizens turned to Bitcoin and stablecoins like U.S. dollar-pegged stablecoins (USDT) on the Tron network to hedge savings, facilitate remittances, and move value when traditional banking failed. Spikes in Bitcoin withdrawals to personal wallets often coincided with domestic unrest and regional conflicts.

Yet this parallel financial system has also become a powerful tool for the state. The Islamic Revolutionary Guard Corps (IRGC) steadily tightened its grip on Iran’s crypto flows. IRGC-linked addresses received more than $3 billion in 2025—up from over $2 billion in 2024—with their share rising to more than 50 percent of total Iranian crypto inflows by the end of 2025. These figures represent conservative lower bounds based only on identified and sanctioned wallets.

Washington in the meantime is still entertaining dreams of sparking some kind of anti-regime uprising based on applying the economic squeeze to the Iranian system, but apart from unrest back in January, this has utterly failed to materialize. 

Tyler Durden
Tue, 06/02/2026 – 20:30

Trump Signs AI ‘Cyber Defense’ Executive Order

Trump Signs AI ‘Cyber Defense’ Executive Order

Authored by Jacob Burg via The Epoch Times,

AI companies would be required to submit their frontier models on a voluntary review basis before public releases.

President Donald Trump signed an executive order on June 2 intended to address cybersecurity threats posed by artificial intelligence (AI) technology and the new frontier models being released by major industry players.

Signed in private, the order allows some AI firms to submit their cutting-edge frontier models to a voluntary government review 30 days before a full public release.

That would entail “provid[ing] the Federal Government with access to covered frontier models, subject to appropriate confidentiality, cybersecurity, insider-risk, and intellectual-property protection, use, and nondisclosure requirements, for a period of up to 30 days before they plan to release such models to other trusted partners.”

The order also gives the Pentagon, the Department of Homeland Security, the Cybersecurity and Infrastructure Security Agency, the Office of Management and Budget, and other related agencies 30 days to “expedite and prioritize the cyber defense of civilian Federal Government information systems” and establish or expand a federal program that would “enhance AI-enabled defensive tools.”

Trump’s order also creates an “AI cybersecurity clearinghouse” that would function in “voluntary collaboration” with the AI industry and other critical infrastructure operators. The goal would be to scan for software vulnerabilities in frontier AI models while prioritizing “remediation and distribution of vulnerability patches.”

Trump had planned to sign a previous version of this executive order, but said on May 21 that he would delay the signing after becoming dissatisfied with “certain aspects of it.”

Earlier that month, the Commerce Department’s Center for AI Standards and Innovation announced partnerships with AI giants Google, Microsoft, and xAI to test their new frontier models for potential security risks ahead of full public releases.

Cybersecurity concerns over frontier AI models surged after Anthropic on April 7 announced its Claude Mythos Preview model, which is not yet publicly available due to the company’s concerns that bad actors could use it to find critical software exploits.

The Trump administration had previously moved to ban Anthropic from doing business with the federal government after the company refused to grant the Pentagon unrestricted access to its Claude models, stating that it was concerned they would be used for mass domestic surveillance or fully autonomous weapons, which the Pentagon denies.

Despite the ban, Anthropic co-founder Jack Clark said in April that he had been in talks with the Trump administration over Claude Mythos Preview.

The Alliance for Secure AI, a nonprofit that “educates the public about the implications of advanced AI,” on June 2 called for Congress to codify Trump’s executive order to “create a legal framework that makes federal government review of advanced AI models mandatory.”

Trump’s executive order allows AI companies to submit their frontier models to government review on a voluntary basis.

“After the national security wake-up call from advanced AI models like Mythos, we are pleased to see that the Trump administration is taking the risks of these models seriously. However, we know that Big Tech will still try to cut corners on safety and security,” Brendan Steinhauser, CEO of The Alliance for Secure AI, said in a statement.

“The next AI models will be even more powerful and will pose even bigger threats to our country than Mythos. These companies need oversight and cannot be trusted to do the right thing voluntarily.”

Tyler Durden
Tue, 06/02/2026 – 20:05

“The Value Didn’t Arrive”: Bain Finds Cost-Savings From AI Are Falling Far Short Of Projections

“The Value Didn’t Arrive”: Bain Finds Cost-Savings From AI Are Falling Far Short Of Projections

Now that attention within the AI revolution has one again firmly turned toward the cost-benefit equation (i..e., ROI) of tokens (see “From Singularity To Tokenomics: The AI Narrative Just Hit A Serious Snag“) in particular, and the trillions behind the AI spending rollout in general, and we say once again because every few months we get some iteration of the following report from Goldman published almost two years ago today…

… we have more bad news: according to a global survey by Bain, cost savings from automation are broadly falling short of projections. Which means that those expecting big savings from their investments in artificial intelligence, which is most companies, will be disappointed. 

The missed targets “should be making executives uncomfortable,” since many of them are approving increased spending for artificial intelligence on the basis of expected savings, the consulting firm said in a report shared exclusively with Bloomberg News. The problem is there are little actual savings to speak of. 

The survey, completed in April, was based on responses from executives at 951 companies with more than $100 million in revenue, across nine sectors: retail, technology, advanced manufacturing, healthcare, consumer products, energy, financial services, telecom/media/entertainment and insurance.

It found that among companies measuring their AI cost savings, the largest share (40%) realized reductions of 10% or less. Predictably, most had been expecting to see far more meaningful improvement, especially since they spent far more than that on the new technology. 

Here’s the part that Bain found the most troubling: 44% of large companies that are funding their next wave of AI spending are basing those investments on the last round of savings – savings that haven’t yet materialized. 

“The prior wave underdelivered. The savings pool is smaller than assumed,” Bain warned. “And the investment case for the current wave was sized against projections rather than actuals.” Kinda like the bubble in AI forward earnings: based on projections – which as any intern can tell you can flip on a dime – rather than actuals. 

“Self-funding the next wave from past returns sounds like discipline. In reality, it is a circular bet with a structural leak,” the firm cautioned, and concluded that “The technology worked. The value didn’t arrive.”

Whether driven by hope or FOMO or a blend of both, the AI boom is exposing divides between promise and reality. An MIT research report last year showed that 95% of corporate AI pilots fall flat and concluded that the “primary factor keeping organizations on the wrong side of the GenAI Divide is the learning gap, tools that don’t learn, integrate poorly, or match workflows.” 

So Bain’s latest survey wasn’t the first evidence of AI underdelivering so far on expectations. And it’s not likely the last either.

But the Bain report isolated a different problem: “Despite a decade of investments in data modernization running well into hundreds of billions of dollars globally, the No. 1 reason AI programs underperform is that companies cannot reliably get access to their own data,” Bain said.

“Companies that don’t validate their reinvestment math against what automation actually returned, rather than what it was supposed to return, are compounding risk rather than managing it” the Bain report concluded, confirming what many have already sensed: virtually nobody has done effective ROI analysis amid a technological rollout that has already soaked up more than $1 trillion in capital, the return on which appears to be modest at best. 

Bain’s prescription: Instead of waiting to structure all of their data to make it ingestible by AI, companies should start with what’s available to feed into the models, and then use AI to help sort out how to structure the rest.

Meanwhile, companies that were meeting their savings targets reported running into barriers with data structure and accessibility at even higher rates than those missing their targets, but they were less likely to report organizational challenges such as insufficient budgets or competing priorities.

Adding fuel to the fire, a comparable report from Gartner found that over 40% of agentic AI projects will be canceled by the end of 2027, due to escalating costs, unclear business value or inadequate risk controls. 

“Most agentic AI projects right now are early stage experiments or proof of concepts that are mostly driven by hype and are often misapplied,” said Anushree Verma, Senior Director Analyst, Gartner. “This can blind organizations to the real cost and complexity of deploying AI agents at scale, stalling projects from moving into production. They need to cut through the hype to make careful, strategic decisions about where and how they apply this emerging technology.”

As such, Gartner recommends agentic AI only be pursued where it delivers clear value or ROI, noting that “Integrating agents into legacy systems can be technically complex, often disrupting workflows and requiring costly modifications. In many cases, rethinking workflows with agentic AI from the ground up is the ideal path to successful implementation.

“To get real value from agentic AI, organizations must focus on enterprise productivity, rather than just individual task augmentation,” said Verma. “They can start by using AI agents when decisions are needed, automation for routine workflows and assistants for simple retrieval. It’s about driving business value through cost, quality, speed and scale.” 

The problem, it now appears, is that virtually nobody has done an actual ROI analysis. But with token costs now soaring…

… the time has finally arrived, and as enterprises pull back in horror from the “great promise” of the agentic black hole, one can easily understand why both OpenAI and Anthropic, both of which are extrapolating their burst in agentic revenue in perpetuity, are rushing to go public before the market once again does the ROI math.

Tyler Durden
Tue, 06/02/2026 – 18:50

Dems Have A Voter Problem. Gerrymandering Was Never Going To Fix It

Dems Have A Voter Problem. Gerrymandering Was Never Going To Fix It

Authored by Ryan Young via RealClearPolitics,

In November 2024, 47% of Virginia voters cast ballots for Republican congressional candidates. Under the map Virginia Democrats tried to push through, those voters would have ended up with exactly one Republican district out of 11. Going from a 6-5 to a 10-1 split was what Democrats called “restoring fairness.”

To get it done, Democrats bypassed a bipartisan redistricting commission that Virginia voters had specifically created in 2020 to end partisan map-drawing. They drafted the new map behind closed doors. They passed a constitutional amendment on Oct. 31, 2025, even though early voting for the general election had been underway since Sept. 19 – violating the state constitution’s requirement that an intervening election occur between the two legislative votes. They missed the requirement that amendments be posted publicly 90 days before a vote. And they put a ballot question before voters asking whether they wanted to “restore fairness” – language a circuit court judge called “flagrantly misleading.”

Every step of this process required ignoring a rule or deceiving a voter.

That is not a party making a policy argument. That is a party that has decided winning at any cost is more important than following the rules.

When the Virginia Supreme Court ruled 4-3 that the effort was unconstitutional, Democrats did not stop and reflect. Instead, they doubled down. Rather than accept the Virginia Supreme Court’s decision, House Speaker Don Scott and Attorney General Jay Jones filed an emergency appeal to the U.S. Supreme Court, riddled with spelling errors and mistakes. U.S. House Minority Leader Hakeem Jeffries called the ruling “unprecedented and undemocratic.” U.S. Rep. Suzan DelBene, chair of the Democratic Congressional Campaign Committee, said four unelected judges had “cast aside the will of the voters.” Most revealingly, the New York Times reported that, on a call with Jeffries, Virginia Democratic members of Congress discussed lowering the mandatory retirement age for Virginia Supreme Court justices from 73 to 54 – the exact age of the youngest justice in the majority. This would force the entire court to retire and create an opportunity to replace them with justices who would reinstate the map. Today’s Democratic politicians are showing their true colors: These are radicals in moderates’ clothing. Republicans should respond accordingly.

Republicans should not mistake what happened in Virginia for a one-off procedural accident. Democrats’ willingness to bypass a voter-approved bipartisan commission, ignore constitutional rules, mislead voters on the ballot, and then float court-packing to overcome their illegality is a window into how the modern Democratic Party operates.

But Democrats’ bizarre map was never going to solve their underlying problem.

People are voting with their feet by moving to well-run red states. The 2030 census is projected to shift eight to 10 electoral votes from blue states to red ones – a 16- to 20-point shift that will dramatically tighten the path to the White House for a Democrat candidate.

If Democrats want to compete in the years ahead, they will need to move to the middle to meet voters where they are. Instead of seeking to rig the game, Democrats should persuade voters on the issues the voters actually care about. They should support mainstream, commonsense ideas that they have too long resisted. School choice polls at roughly 74% nationally. Voter ID polls at 84%. Cracking down on welfare fraud polls at 71%, including 62% of Democrats. These are easy wins just waiting for politicians of both parties. It doesn’t take a political genius to realize that Democrats should stop their sprint to the left and side with the majority of voters instead.

Virginia’s brief attempt at gerrymandering was a disgrace and a national embarrassment. Democrats’ unhinged reaction to its defeat was even worse. But the aftermath should be a moment of reflection and readjustment for both parties. Voters are looking for leaders who listen to their concerns, make government work for them, and improve their lives. Democrats should seek to win, fair and square, by pursuing commonsense policies the people want. This is how our system is supposed to work. Otherwise, Democrats – and voters – will continue to see red.

Ryan Young is the Legal Fellow at the Foundation for Government Accountability.

Tyler Durden
Tue, 06/02/2026 – 18:25

Woman Fatally Stabbed “Two Dozen Times” In Brazen Daytime Attack On Atlanta’s MARTA Train

Woman Fatally Stabbed “Two Dozen Times” In Brazen Daytime Attack On Atlanta’s MARTA Train

A woman riding a MARTA train in Atlanta was killed in a brutal daytime attack Saturday, suffering nearly 20 stab wounds in what investigators say was a seemingly random act of violence, according to the NY Post.

Police allege that 25-year-old John Elijah Matthews approached 66-year-old Margaret Swan after boarding the train Saturday morning. Surveillance video reportedly shows him lingering near Swan before pulling out a knife and attacking her. According to court documents, Swan cried out and attempted to get away, but the suspect allegedly restrained her and repeatedly stabbed her.

Investigators say the assault continued as the train neared Oakland City Station. Matthews allegedly forced Swan to the floor and remained over her while she lay gravely injured.

The NY Post writes that after the attack, authorities say the suspect exited the train carrying the knife, leaving Swan motionless inside the rail car. Responding officers and emergency personnel tried to save her, but she was pronounced dead. The knife believed to have been used in the attack was later recovered.

Witness descriptions helped MARTA police quickly locate and arrest Matthews on the station platform shortly after the incident.

In a statement, MARTA officials described the killing as a senseless tragedy and extended condolences to Swan’s family, as well as those who witnessed the violence firsthand.

The fatal stabbing came just days after another passenger was attacked at Georgia State Station, raising fresh concerns about safety across the transit system. Some riders argued that recent changes to fare collection have made it easier for unauthorized individuals to access trains and stations, though officials have not linked the policy to either incident.

Matthews, who reportedly has no fixed address, remains in custody at the Fulton County Jail. He has been charged with felony murder and was scheduled to appear in court Monday.

Tyler Durden
Tue, 06/02/2026 – 18:00