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US To Cut Flights By 10% At 40 Airports As Shutdown Persists

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US To Cut Flights By 10% At 40 Airports As Shutdown Persists

Air traffic at 40 major US airports will be cut by 10% starting Friday as travelers continue to face flight disruptions due to a spike in air traffic controller absences during what is now the longest government shutdown on record. 

During a Wednesday press briefing alongside the leader of the Federal Aviation Administration, Bryan Bedford, US transportation secretary Sean Duffy said that the Federal Aviation Administration would begin reducing flights later this week to keep air travel safe as it contends with shutdown pain on top of a nationwide shortfall of about 2,000 air traffic controllers. 

The names of the 40 affected airports would be released on Thursday, FAA head Bryan Bedford said at the press conference with Duffy, who said the decision would be data-based. 

“The data will dictate what we do,” Duffy said. “If the data goes in the wrong direction, could you see additional restrictions? Yes.”

“This is not based on what airlines have more flights out of what location. This is about, ‘Where’s the pressure, and how do we alleviate the pressure?’” Duffy said. 

Duffy said the cuts were necessary to maintain air travel safety. Cuts to international flights hadn’t been discussed, although unless the shutdown situation changes, those too are likely. Bedford added that he sees the FAA restricting space launches as well. 

Airlines were expected to advise customers of changes to scheduled flights after Thursday’s announcement.

The transportation secretary added that steps had already been taken to shore up its workforce — including offering cash bonuses to incentivise retirement-age controllers to continue working, and “surging” trainees at its academy.

“The shutdown is having an impact on our ability to maintain those numbers and dent that 2,000 shortage that we have,” he added.

The FAA has been forced to slow traffic at many airports in recent days due to rising controller staffing shortages since the government shutdown began on Oct. 1. Air traffic controllers continue to work without pay.

Millions of passengers have grappled with flight cancellations and delays related to staffing since the shutdown started, Airlines for America, a trade group, said. 

Tyler Durden
Wed, 11/05/2025 – 19:15

“We’re Coming After You” – How Some On The Left Found Peace Through Hate

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“We’re Coming After You” – How Some On The Left Found Peace Through Hate

Authored by Jonathan Turley,

In Shakespeare’s Richard III, Queen Elizabeth — whose husband King Edward IV was overthrown and her twins taken to the Tower — asks the older Queen Margaret (widow of the murdered King Henry VI) to “teach me how to curse mine enemies.” The Queen responds that it is easy: “Think that thy babes were sweeter than they were, And he that slew them fouler than he is.”

The lesson: The key to hate is to decouple it entirely from reason and reality. Only then can you hate completely without restraint or regret.

It seems that the left has learned how to hate. Hateful speech is in vogue as Democratic leaders ramp up violent rhetoric and political violence rises. The key is to get voters to hate your opponent so much that they forget how much they dislike you.

The irony is crushing. For years, liberals have sought to criminalize hate speech while expanding the range of viewpoints considered to fall within this category. Democratic leaders, from senators to former presidential candidates, have falsely claimed that hate speech is not protected under the First Amendment.

In “The Indispensable Right: Free Speech in an Age of Rage,” I write about rage and the uncomfortable fact: “What few today want to admit is that they like it. They like the freedom that it affords, the ability to hate and harass without a sense of responsibility.” Rage is addictive, and it is contagious.

What rage-addicts cannot tolerate are those who cling to residual impulses of decency or humanity. In an age of rage, reason is viewed as a reactionary tendency.

This week, Bravo star and liberal podcast host Jennifer Welch praised footage of a “No Kings” protester celebrating the death of Charlie Kirk, holding her up as an example for all liberals.

In the clip, the elderly woman said, “Charlie Kirk is horrible. Yes. I’m glad he’s not here.” When pressed if she was actually happy that the husband and father of two had been murdered, the woman said “Yes…because he was horrible on the campuses. Horrible person.”

After playing the clip, Welch laughed with joy and declared, “So listen up, Democratic establishment. You can either jump on board with this s—, or we’re coming after you in the same way that we come after MAGA. Period.”

Celebrities like Jamie Lee Curtis certainly got that message. The actress was facing a social and professional meltdown after openly mourning Kirk’s death in a podcast interview. “I disagreed with him on almost every point I ever heard him say,” she said. “But I believe he was a man of faith, and I hope in that moment when he died, that he felt connected to his faith, even though his ideas were abhorrent to me.”

It appeared to be a moment of weakness that briefly overrode wokeness. Curtis quickly found herself persona non grata in Hollywood, as an angry liberal mob began to circle her. Curtis quickly saw the light and effectively retracted her fleeting expression of humanity, claiming it had been “mistranslated.” It is said that in the land of the blind, the one-eyed man is king. But that does not apply if you then gouge out your own eye. Now fully and comfortably blinded by her own hand, Curtis is back as a member of good standing in Hollywood.

Internationally, the left has pushed for criminalizing the speech of those with opposing views as hateful and harmful. UNESCO works off a definition of hate speech as including “pejorative or discriminatory language with reference to a person or a group on the basis of who they are, in other words, based on their religion, ethnicity, nationality, race, color, descent, gender or other identity factor.” This includes “scapegoating, stereotyping, stigmatization and the use of derogatory language” based on any “identity factor.”

Countries are also “required to prohibit” speech tied to “conspiracy theories, disinformation and denial and distortion of historical events.”

In the past, some leftists have included political criticism or parodies of their leaders as hate speech. For example, when a rodeo clown, Tuffy Gessling, donned a President Barack Obama mask at the Missouri State Fair as part of a skit years ago, the response was calls for his arrest. The President of the Missouri chapter of the NAACP, Mary Radliff, insisted that it constituted criminal hate speech.

But things have changed. The left has now discovered the thrill of uninhibited hate.

Recently, in Chicago, elementary school teacher Lucy Martinez was shown on video reacting to an image of Kirk by mockingly making a gesture akin to being shot in the neck, mimicking how Kirk had been assassinated.

Another educator, Wilbur Wright College Adult Education Manager Moises Bernal, screamed to a crowd that “ICE agents gotta get shot and wiped out.” Bernal told the crowd, “You gotta grab a gun!” and “We gotta turn around the guns on this fascist system!”

In academia, hateful speech has long been a way to establish one’s bona fides as a faculty member. By attacking and excluding others, you reaffirm your own protected status.

Faculty have thrilled their colleagues and students by talking about “detonating white people,” abolishing white people,  calling for Republicans to suffer,  strangling police officerscelebrating the death of conservativescalling for the killing of Trump supporters, and supporting the murder of conservative protesters.

Even school board members have referred to taking faculty “to the slaughterhouse” for questioning diversity, equity and inclusion policies.

Last week, Democratic strategist James Carville went on a hate-filled rant, to the delight of his podcast audience. He declared that anyone supporting Trump and the Republicans will be treated like collaborators in World War II who were publicly abused and paraded by mobs.

“You know what we do with collaborators?” he said. “I think these corporations [funding White House renovations] — my fantasy dream is that this nightmare ends in 2029 and I think we ought to have radical things. I think they all ought to have their heads shaven, they should be put in orange pajamas and they should be marched down Pennsylvania Avenue and the public should be invited to spit on them.”

Carville later repeated the call that “The universities, the corporations, the law firms, all of these collaborators should be shaved, pajamaed and spit on.”

For years, Democratic leaders have given their base the license for such blind rage by calling Republicans “Nazis” and claiming that democracy will die unless their opponents are stopped.

The effect has been transformative across the party. In the current race for Virginia Attorney General, Democratic nominee Jay Jones admitted to sending text messages expressing the desire to kill a political opponent, “piss on the grave” of a dead Republican, and kill his children, whom he dismissed as “little fascists,” in their mother’s arms.

There was a time when such a candidate would be denounced by those on the ticket from his party and made a nonentity in politics. Instead, the Virginia Democratic gubernatorial nominee, Abigail Spanberger (who had previously told her supporters to “Let your rage fuel you”), has refused to withdraw her endorsement. Moreover, the race remains close, with most Democratic voters still planning to cast their ballots for him.

It is a lesson many hope will take hold in the midterm elections. Like Queen Elizabeth, these voters have overcome all inhibitions and can now teach others “how to curse.”

*  *  *

Jonathan Turley is the Shapiro Professor of Public Interest Law at George Washington University. He is the author of the bestselling book “The Indispensable Right: Free Speech in an Age of Rage.”

Tyler Durden
Wed, 11/05/2025 – 17:40

Trump Considering Menu Of Venezuela Attack Options, Including Oil-Field Seizures

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Trump Considering Menu Of Venezuela Attack Options, Including Oil-Field Seizures

Though Donald Trump campaigned on pledges to end America’s endless wars and regime change campaigns, the White House has now assembled a list of potential military attacks on Venezuela, with the president and senior officials evaluating the associated risks of each option, the New York Times reported on Tuesday. Those options include the seizure of oil fields or a targeted ousting of President Nicolás Maduro. 

In a parallel undertaking, the Department of Justice is evaluating legal rationales for the various options, with an eye on justifying unilateral action by the president without congressional authorization for the use of military force. According to the Times‘ sources, those rationales would likely center on the allegation that Maduro and top officials are working for Cartel de los Soles, which the administration has imaginatively designated a “narcoterrorist” group. Under that pretext, the DOJ would say Maduro is a fair military target, negating various US prohibitions on assassinations of foreign heads of state.   

In pushing for regime change in Venezuela, long-time interventionist Marco Rubio seems to be the second Trump administration’s version of John Bolton 

Unsurprisingly, one of the leading champions of aggressive action is Secretary of State Marco Rubio, a long-time hawk whose selection by Trump caused widespread unease among the president’s non-interventionist supporters. Along with Homeland Security Advisor Stephen Miller, Marco is pushing for nothing less than Maduro’s ouster, the Times reported. 

Over the past two months, the United States has engaged in 16 airstrikes on boats off Venezuela that the White House claimed were transporting drugs to America. Critics including Sen. Rand Paul say the boats lacked the range to do that. Sixty-seven people have reportedly been killed in the strikes. According to the Times, the range of new military options under consideration include: 

  • Airstrikes against military facilities to sap Maduro’s support from the country’s armed forces. Opponents argue that such strikes may instead galvanize the military’s bond with Maduro.   
  • Using elite units like Delta Force or SEAL Team 6 to seize or kill Maduro himself
  • Tasking counterterrorism forces with seizing oil fields and related infrastructure, along with air fields

Trump himself is said to be less gung ho about escalation, with his hesitancy reportedly springing from two concerns: Worries about putting US service-members in peril, and fear of a humiliating failure. His rhetoric about Venezuela has veered back and forth over recent weeks — from hinting in mid-October that US military engagement might advance from blowing up alleged drug traffickers in boats to hitting targets on land, to telling 60 Minutes this week that he doubts the US is on a path to war with Venezuela. “I doubt it,” he told Norah O’Donnell. “I don’t think so, but they’ve been treating us very badly, not only on drugs — they’ve dumped hundreds of thousands of people into our country that we didn’t want.” 

Last weekend, the Washington Post reported that the Pentagon was amassing forces in the southern Caribbean, comprising 10,000 soldiers and Marines and 6,000 sailors, along with eight Navy ships, a special ops vessel, and an attack submarine. The aircraft carrier USS Gerald R. Ford is en route, along with three more ships. The Marines conducted landing drills on Puerto Rico over the weekend, and engineers are rehabilitating the old Roosevelt Roads naval base there.  

Russia has said it’s closely monitoring the situation in Venezuela, which holds the world’s largest crude oil reserves and is more than twice the size of Iraq. Maduro has reportedly requested military assistance from Moscow. It’s unknown whether Russia — which already has its and full with the war in Ukraine — intends to bolster Venezuela’s defenses. Arming a country within the US sphere of influence could be a fitting counter to the West’s engagement in Ukraine. 

Meanwhile, as the Trump White House contemplates America’s newest regime-change campaign, we’re reminded of what Tom Woods famously said: “No matter who you vote for, you get John McCain.” 

Tyler Durden
Wed, 11/05/2025 – 17:20

Median Age For First-Time Home Buyer Hits 40, A Record High

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Median Age For First-Time Home Buyer Hits 40, A Record High

Authored by Brett Rowland via The Center Square,

The median age for a first-time home buyer just hit 40, a record high, according to a new report from the National Association of Realtors. 

The median buyer age increased to a peak of 59 years, up from 56 the previous year. The median age of first-time buyers increased to 40 this year from 38 the previous year, while the typical age of repeat buyers also rose to 62 from 61. First-time homebuyers decreased to 21% of the market share, down from 24% last year. That marks the lowest share since NAR began collecting the data in 1981. Before the Great Recession, the historical norm was 40%. The report noted the division in the housing market.

“In the 1980s, the typical first-time home buyer was in their late 20s,” according to NAR’s 2025 Profile of Home Buyers and Sellers. “The housing market remains divided between an all-time high of all-cash home buyers and an all-time low of first-time buyers.” 

Jessica Lautz, NAR deputy chief economist and vice president of research, said the implications are “staggering.”

“The historically low share of first-time buyers underscores the real-world consequences of a housing market starved for affordable inventory,” she said.

“The share of first-time buyers in the market has contracted by 50% since 2007 – right before the Great Recession. The implications for the housing market are staggering. Today’s first-time buyers are building less housing wealth and will likely have fewer moves over a lifetime as a result.”

Twenty-four percent of all buyers had children under the age of 18 living at home, a historically low percentage. That’s down from 27% last year and from 58% in 1985. This year, 11% of home buyers had one child, 9% had two children, and 5% had three or more children. Thirty-two percent of first-time buyers and 22% of repeat buyers had children under the age of 18. 

Seventy-six percent of all buyers had no children under the age of 18 living at home, up from 73% last year. 

“Unfolding in the housing market is a tale of two cities,” Lautz said. “We’re seeing buyers with significant housing equity making larger down payments and all-cash offers, while first-time buyers continue to struggle to enter the market.”

White people were more likely to purchase homes than members of other racial groups. Eighty-four percent of recent home buyers identified their ethnicity as White or Caucasian. Another 7% identified as Hispanic/Latino, 6% of recent buyers identified as Black/African American, 4% identified as Asian/Pacific Islander, and 3% identified as a different ethnicity.

Delaying home ownership can cost equity.

“For generations, access to homeownership has been the primary way Americans build wealth and the cornerstone of the American Dream,” said Shannon McGahn, NAR executive vice president and chief advocacy officer. “Delayed or denied homeownership until age 40 instead of 30 can mean losing roughly $150,000 in equity on a typical starter home.”

She said more housing was needed.

“Today, we must focus on policies that address the root cause of the affordability crisis: inadequate housing supply,” McGahn said. “That means both unlocking existing inventory and enabling new construction. We need solutions that encourage more owners to sell, revitalize underused properties, streamline local zoning and permitting barriers, and modernize construction methods to build more homes faster and more affordably. These common sense reforms make homes more affordable, restore opportunity, and help revive the dream of homeownership for generations to come.”

Tyler Durden
Wed, 11/05/2025 – 17:00

Democrat Election Victories Fail To Spark Mass Mobilization Around White House

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Democrat Election Victories Fail To Spark Mass Mobilization Around White House

The longest U.S. government shutdown in history certaintly hurt Republicans, as Democrats scored victories in Tuesday’s elections, including socialist Zohran Mamdani becoming New York City’s next mayor, and Abigail Spanberger and Mikie Sherrill winning their respective gubernatorial races in Virginia and New Jersey. However, none of that momentum rolled into the Democratic Party’s color revolution-style operation on Wednesday to surround the White House under the banner The Trump Fascist Regime Must Go Now.”

Refuse Fascism, a “No Kings” partner funded by dark-money NGOs, planned sentiment-shaping operations aimed at swaying public opinion and undermining the Trump administration ahead of the 2026 midterm cycle. One might have expected, given the momentum from last night’s election results, that this front group of unhinged leftist boomers would have managed to rally more supporters out of the retirement homes – but like the last No Kings protest, it fell entirely flat… 

All protesters were holding the same professionally made sign. Also, ‘Grantifa’ was spotted, again… 

Folks are figuring out that the Democratic Party’s protests are far from organic; in fact, they appear funded by Arabella Network, Soros Network, Gates Foundation, Ford Foundation, Tides Foundation, Rockefeller Network, Singham Network, and many others. Investigative researchers Peter Schweizer and Seamus Bruner of the Government Accountability Institute called the protest industrial complex nothing more than “Riot, Inc.,” and it is the ‘Deep State-supported’ engine to overthrow Trump.

Given how coordinated many of these protests appear, it’s worth examining who supports these far-left candidates, no other than…

The timing of today’s protest – just one day after the elections- appeared aimed at revving up post-election momentum into public demonstrations, but the effort largely failed to gain traction.

Tyler Durden
Wed, 11/05/2025 – 16:40

US Household Debt Hits Record $18.6 Trillion As Student Loan Defaults Explode

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US Household Debt Hits Record $18.6 Trillion As Student Loan Defaults Explode

The NY Fed published its Quarterly Report on Household Debt and Credit.

Surprising exactly no-one, the report showed that total household debt increased by $197 billion (1%) in Q3 2025, to a new record high of $18.59 trillion. split between $13.5 trillion in housing debt and $5.1 trillion in non-housing debt.

“Household debt balances are growing at a moderate pace, with delinquency rates stabilizing,” said Donghoon Lee, Economic Research Advisor at the New York Fed. “The relatively low mortgage delinquency rates reflect the housing market’s resilience, driven by ample home equity and tight underwriting standards.” 

Some details:

  • Mortgage balances grew by $137 billion in the third quarter and totaled $13.07 trillion at the end of September 2025.
    • Mortgage delinquency rate rose to 0.83% from 0.82% prior quarter
  • Credit card balances rose by $24 billion from the previous quarter and stood at $1.23 trillion.
    • Delinquency rate at 12.41%, highest since 2011
  • Auto loan balances held steady at $1.66 trillion.
  • Home equity line of credit (HELOC) balances rose by $11 billion to $422 billion.
  • Student loan balances rose by $15 billion and stood at $1.65 trillion.

In total, non-housing balances rose by $49 billion, a 1.0% increase from Q2 2025

Taking a closer look we find that…  

  • The pace of mortgage originations increased with $512 billion newly originated in Q3 2025.

The only silver lining in the report is that housing debt levels and delinquencies have stabilized: “Household debt balances are growing at a moderate pace, with delinquency rates stabilizing,” Donghoon Lee, an economic research advisor at the New York Fed, said in a press release accompanying the figures. “The relatively low mortgage delinquency rates reflect the housing market’s resilience, driven by ample home equity and tight underwriting standards.”

While that is true, let’s see what happens to the US housing market once the avalanche starts, tipped off the by scramble to sell everything in the mecca of Capitalism, New York City, which is now controlled by a communist. 

Moving on: 

  • There was $184 billion in new auto loans and leases appearing on credit reports during the third quarter, a small dip from the $188 billion observed in Q2 2025.

  • Aggregate limits on credit card accounts continued to rise by $94 billion, representing a 1.8% increase from the previous quarter.
  • Home equity lines of credit (HELOC) limits rose by $8 billion, continuing the growth in HELOC limits that began in 2022.

Of course, with rising debt, come rising delinquencies, and in the case of student debt, absolutely explosive ones.

As the NY Fed writes, aggregate delinquency rates remained elevated in Q3 2025, with 4.5% of outstanding debt in some stage of delinquency. Transitions into early delinquency were mixed with credit card debt and student loans increasing, while all other debt types saw decreases.

Transitions into delinquency (30+ days)…

… and serious delinquency (90+ days) increased across all debt types.

Total consumer bankruptcies jumped to 141,600 in Q3, the highest since the covid crash year of 2020. 

Taking a closer look at the ground zero of the current consumption crisis, namely student Loans, where outstanding debt stood at $1.65 trillion in Q3 2025.  

And the punchline: missed federal student loan payments that were not previously reported to credit bureaus between Q2 2020 and Q4 2024 are now appearing in credit reports. Consequently, student loan delinquency rates have continued to surge after a sharp rise in the first half of 2025. In Q3 2025, 9.4% of aggregate student debt was reported as 90+ days delinquent or in default, as compared to 7.8% in Q1 2025 and 10.2% in Q2 2025. Also of note in the chart below, the credit card serious delinquency rate is actually creeping up even faster, and hit 12.41%, the highest since 2011.

And the most remarkable observation: over 20% of all student debt by those aged 50 and over (!) is effectively in default (technically it is still delinquent, but if millions haven’t made even a token effort to repay it in 90 days, one can safely classify it as in default).

That’s millions of potential consumers whose credit rating is about to get obliterated and who will not have access to credit cards or other debt forms for a long time. 

More in the full New York Fed presentation.

Tyler Durden
Wed, 11/05/2025 – 16:35

Abrupt Sentiment Shift Rocks Gen Z: Restaurants Warn Of Spending Drop As Student Loan “Default Cliff” Arrives

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Abrupt Sentiment Shift Rocks Gen Z: Restaurants Warn Of Spending Drop As Student Loan “Default Cliff” Arrives

The Trump administration faces a worsening macroeconomic backdrop for younger, lower- and middle-income consumers, burdened by student debt, costly auto loans, high apartment rents, and depleted savings amid a persistently high interest rate environment. 

Early signs of financial strain emerged at the tail end of the summer, outlined in our note:

We’ve been tracking this alarming trend, which was reinforced by the latest warning from Goldman Delta One, Rich Privorotsky, who has gone “Defcon 1” on the rapidly deteriorating consumer.

Early signs of strain have emerged across the restaurant and casual dining segment, where management teams are flagging a noticeable pullback in discretionary spending among younger consumers. This cohort is increasingly shifting from dining out to at-home consumption, opting for groceries over restaurants as they can no longer justify $8 Starbucks coffee and $15 Chipotle burritos.

Last week, Goldman’s Consumer specialist Scott Feiler published a red alert on “The Shifting Health of the US Consumer,” warning of acute deterioration among the US middle class. 

Feiler followed up the warning with a weekend note that said, “Something has clearly changed with the consumer. Commentary from restaurants and grocers last week made that clear.” 

He noted that consumer stocks are massive underperformers year-to-date (Restaurant group -21% YTD, Housing -7% YTD, Retail -3% YTD). 

However, he said, “It is worth noting that November is the best month for Consumer Discretionary of the year.  The last 5 years, the group is +8.4% during November, on average, with an 80% hit rate.  It is the largest outperformance month vs the market, on average, as well.” 

Consumer Discretionary (GSXUCOND Index) Average Price Action By Month. November is The Strongest Month of the Year on an Absolute & Relative Basis.

Feiler previously noted that more companies are warning of signs of a slowdown across the consumer space, with weakness mainly across middle-income consumers, particularly those aged 25 to 35. The brunt of this has been observed across the restaurant space: 

There’s been increasing chatter about the notable negative shift in sentiment among younger consumers, which happened quite abruptly. We spoke with a senior analyst at one of the world’s largest U.S.-based beverage companies who attributed the slowdown to tariffs. However, we disagree and believe the actual shock was the student loan “default cliff” that hit in late summer.

There are about 5.3 million student loan borrowers in default, and another 4.3 million borrowers are in “late-stage delinquency,” or between 181 and 270 days late on their payments, according to a recent Congressional Research Service report based on Education Department data. Payments 270 days past due are considered in default.

We don’t disagree that a slowing jobs market and tariffs are compounding pressures on consumers, but the unfolding mess tied to the student loan default cliff hitting younger borrowers is clearly a major driver behind the sharp shift in sentiment.

Given that Democrats have shifted so far to the left by fully embracing socialism and a sprinkle of Marxism, promising those who vote for them free bus rides, government-run supermarkets, and other free stuff, the question becomes how the Trump administration will win some of these youngsters struggling to survive. We do note the Trump administration recently offered to bail out farmers with tariff revenues… The admin should start looking at the kids ahead of the 2026 midterms.

Tyler Durden
Wed, 11/05/2025 – 15:40

How Long Does US Depositors’ Nerve Hold?

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How Long Does US Depositors’ Nerve Hold?

Authored by Tuomas Malinen via GnS Economics Newsletter,

I am returning to work slowly and will start with an update to the Bank Run Warning we issued on Friday.

Not a single financial institution sought funding through the SRF today (Wednesday), but this does not lead me to conclude that the risk of a banking crisis in the U.S. has passed. It just did not start right now.

While the borrowing from the Standing Repo Facility of the Fed has eased, for now, it does not indicate that the cash-drought some financial institutions are experiencing will be over.

The banks could have sought funding from other counterparties of the repo, or the beginning of the month could have brought more cash in.

The problem the banks currently face, relating to the government shutdown, is two-fold:

  1. Money is accumulating in the U.S. Treasury General Account, and

  2. Loan delinquencies are likely to be mounting.

The former implies that money is not moving from the government to the accounts of some 1.4 million government employees. The latter implies that, as government employees are not getting paid, some of them are not paying back their loans (principal and/or interest) either. Both of these diminish cash flow to banks. Like we noted in the warning on Friday:

What makes the situation precarious is the fragility of banks, which we documented in the Black Swan Outlook.

There has been a massive increase in bank lending during the past few quarters.

It is possible (likely) that some banks have been overly optimistic in the credit boom and are suddenly cash-starved because interest payments and loan repayments have ceased (from their excessive lending).

This may start rumors about the survivability of a bank or a group of banks, which could trigger a bank run in the current uncertain environment.

If there’s no shock, we can assume that the banking system keeps on functioning normally, ensured, for example, by the SRF, from which banks can obtain short-term liquidity to cover for deposit withdrawals.

However, banks are always at risk of failing due to the business model we want them to have. That is, we want to deposit our money in the bank and have it provide loans at the lowest possible interest rate for us. We also want instant access to our funds (demand deposits) or, alternatively, a higher yield (interest rate) to compensate for the lack of immediate access, like in savings accounts.

A standard commercial bank is a business that receives deposits and covers them with assets to balance its balance sheet (most U.S. regional banks operate like this). These assets can be in the form of loans to households and businesses, corporate or government bonds, or central bank reserves. Therefore, if all or a very high share of deposits are withdrawn, there simply is no bank anymore. Its business model fails. This directly implies that if we lose trust in a bank, no amount of reserves can save it from failing.

For example, a slew of bad news broke the trust of depositors in the Silicon Valley Bank (SVB) in mid-March 2023, resulting in a cataclysmic run on 87% of its deposit base in just a few days. No amount of reserves (which the bank had plenty of) could have saved SVB from the devastating outflow of deposits impairing its balance sheet. Thus, the bank failed and was taken over by authorities.

When I understood the role the gargantuan increase of easily-withdrawable demand deposits played behind the runs on SVB and Signature Bank, I thought that a nationwide bank run would almost surely follow the failures of SVB and Signature Bank. However, authorities managed to return the trust to the regional banking system better than I thought (by throwing a proverbial kitchen sink at it). It reminded me of how difficult it is to anticipate the timing and length of bank runs, even though I had warned about the fragility of the U.S. banking system just three weeks before the runs started. But, while the runs were halted, the problems remained.

The fact is that the U.S. banking system has been “run-prone” since 2022 (after the gargantuan increase in demand deposits), and the cash-drought created by the government shutdown is making it worse every passing day.

Hence, the likelihood of a negative shock breaking the trust of U.S. depositors in one or more banks currently grows by the day.

I worry.

Tyler Durden
Wed, 11/05/2025 – 15:20

Apple Taps Rival Google’s 1.2-Trillion-Parameter AI Model To Power Siri

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Apple Taps Rival Google’s 1.2-Trillion-Parameter AI Model To Power Siri

Remember when the iPhone 16 launched in September 2024 and Apple promised “Apple Intelligence” features, such as an AI-powered Siri upgrade capable of handling autonomous tasks, that never fully materialized. 

For now, Apple will integrate Google’s 1.2 trillion-parameter Gemini model to overhaul Siri, the most alarming sign yet that Tim Cook has to rely on outside AI technology.

This AI agreement will cost Cook $1 billion annually until Siri’s upcoming “Linwood” upgrade, targeted for iOS 26.4 next spring, will feature an in-house 1-trillion-parameter model, according to Bloomberg, citing people with knowledge of the matter.

Here are some key details on why Apple is turning to Google for AI support:

  • Gemini will handle Siri’s summarizer and planner functions, allowing for more complex reasoning and contextual understanding, while Apple’s own smaller models continue managing simpler requests. 

  • The Gemini model will operate on Apple’s Private Cloud Compute servers, keeping user data isolated from Google.

  • Apple tested OpenAI’s ChatGPT and Anthropic’s Claude but ultimately went with Google’s model. 

Shares of Apple and Google initially jumped on the news, but the gains quickly faded.

In short, one of the world’s largest tech giants missed the AI hype cycle – unable to deliver a viable product for consumers and forced to rely on a rival’s technology instead. Whether this marks the peak of the AI hype cycle or the beginning of Apple’s fading appeal, one thing is clear: Tim Cook now depends on Google, a sobering reality for the company worth nearly $4 trillion. 

Tyler Durden
Wed, 11/05/2025 – 15:00

When Debt Meets Diamond Hands

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When Debt Meets Diamond Hands

Submitted by QTR’s Fringe Finance

These lessons go for pretty much any asset class, but where I’ve noticed the largest concentration of inane theories, economic non-sequiturs and general outright confusion is among the most hubris-laden speculators in the market, the Bitcoin crowd. I own some Bitcoin and would love it just as much as the next guy if the price went to $1 million or $1 trillion or whatever Michael Saylor’s made up price target is today. But that doesn’t give me a hall pass to disconnect an otherwise well-functioning brain from all financial reality as we’ve ever known it.

Bitcoin loyalists often repeat that holders (or HODLers) never sell, that conviction alone is enough to withstand any downturn. But as seen in the example of Sequans Communications that CoinDesk wrote about this week, even the most outspoken converts to the “BTC treasury strategy” eventually face a moment where reality overtakes belief. Sequans, which pivoted aggressively into Bitcoin earlier this year, just unloaded 970 BTC because its debt burden became too large. Go figure.

The company insisted this sale was merely tactical, yet its stock remains crushed, and its once-promoted strategy now hinges on less leverage and fewer promises.

This is not an isolated corporate event, but a preview of what happens when enthusiasm collides with the reality of financial obligations.

Bitcoin has grown into a financialized asset at every level: corporate treasuries, retail holders borrowing against their stacks, institutions using futures and leverage to enhance returns. During market strength, these decisions feel brilliant — I mean, just look at the scores of assholes who don’t know the difference between a market cap and an enterprise value bragging on social media daily about their financial acumen — and the conviction looks unshakeable. But when liquidity thins or macro stress arrives, as I predict it will in four different spots of the market, even believers discover that math is a stronger force than ideology.

There is a persistent narrative that Bitcoin supply is locked up by long-term holders who will never sell regardless of the price. But that’s not quite the truth.


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In good times, that produces an illusion of invincibility. In downturns, it creates thin markets and a new vulnerability: when someone is forced to sell, there may not be many willing buyers on the other side.

Sequans didn’t exit the trade because it lost faith in Bitcoin. It sold because debt left it no choice. In a deeper decline, more corporations could follow the same path, not as a judgment on the asset, but as a condition for survival.

MicroStrategy, the highest-profile corporate buyer of Bitcoin, reflects the same risk dynamic from a different angle. Instead of selling, it continues to raise capital to buy more, recently issuing equity near roughly 1.3x mNAV, even as Bitcoin prices have slid from their peaks.

Short-seller Jim Chanos has been warning about this structure for years. Chanos’ core point remains timely: as long as the company borrows or dilutes shareholders to accumulate Bitcoin, it is exposed not only to BTC price risk, but to the same liquidity crunches that force other leveraged holders to capitulate when conditions turn.

The same applies to individuals who label themselves as permanent HODLers. It is easy to believe you will never sell when prices are rising or stable. Yet history shows that holders eventually capitulate when the walls close in. Margin calls, taxes, declining business revenue, personal emergencies, or simply the psychological strain of a long drawdown have all proven stronger than slogans. Those who hold through every dip are celebrated, but for every survivor, there are many others quietly forced out near the bottom.

Bitcoin’s market structure still depends on the availability of new liquidity. When that stalls, conviction does not protect portfolios. The lesson from the Sequans example is simple: holders can pretend they are immune to market cycles, but the pressure to de-risk always comes. Some capitulate early, some late, yet the cycle of forced selling repeats. The current downturn may be mild compared to what is possible when financial stress and leverage unwind together.

The belief that Bitcoin holders will never be carried out is comforting. It is also historically false. Every cycle ends with sellers who claimed they would never sell. The next one will be no different, and those most confident today may be the ones tested hardest when the market’s patience expires.

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Tyler Durden
Wed, 11/05/2025 – 14:45