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MiB: Paul Zummo, Chief Investment Officer of J.P. Morgan Alternative Asset Management

The Big Picture -



 

This week, I speak with Paul Zummo, Chief Investment Officer of J.P. Morgan Alternative Asset Management. They discuss the state of alternatives and Paul’s “30 Pearls of Investment Wisdom.” They also discuss the early days of hedge funds, investing in the 90’s and building a hedge fund division.

We discuss how his career evolved, and the ways the industry has changed.

A list of his current reading is here; A transcript of our conversation is available here Tuesday.

You can stream and download our full conversation, including any podcast extras, on Apple Podcasts, SpotifyYouTube, and Bloomberg. All of our earlier podcasts on your favorite pod hosts can be found here.

Be sure to check out our Masters in Business next week with Stephen Cohen, BlackRock Chief Product Officer and Head of Global Product Solutions. He is a member of BlackRock’s Global Executive Committee. Previously, he was Global Head of Fixed Income Indexing (iShares); and Chief Investment Strategist for International Fixed Income and iShares. Blackrock manages $13.5 trillion in AUM; its iShares division is over$5 trillion.

 

 

 

Favorite Books

 

 

 

 

 

 

The post MiB: Paul Zummo, Chief Investment Officer of J.P. Morgan Alternative Asset Management appeared first on The Big Picture.

Schedule for Week of December 7, 2025

Calculated Risk -

Special Note: There is still uncertainty on when some economic reports will be released. The employment report for November will NOT be released this week.
This will be a light week for economic data.  The FOMC meets this week and is expected to cut rates by 25bp.

----- Monday, December 8th -----
No major economic releases scheduled.

----- Tuesday, December 9th -----
6:00 AM: NFIB Small Business Optimism Index for November.

Job Openings and Labor Turnover Survey10:00 AM: Job Openings and Labor Turnover Survey for October from the BLS.

This graph shows job openings (black line), hires (purple), Layoff, Discharges and other (red column), and Quits (light blue column) from the JOLTS.

obs openings increased in August to 7.23 million from 7.21million in July.

The number of job openings (black) were down 6% year-over-year. Quits were down 3% year-over-year.

----- Wednesday, December 10th -----
7:00 AM ET: The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.

2:00 PM: FOMC Meeting Announcement. The Fed is expected to cut rates 25bp at this meeting.

2:00 PM: FOMC Forecasts This will include the Federal Open Market Committee (FOMC) participants' projections of the appropriate target federal funds rate along with the quarterly economic projections.

2:30 PM: Fed Chair Jerome Powell holds a press briefing following the FOMC announcement.

----- Thursday, December 11th -----
8:30 AM: The initial weekly unemployment claims report will be released.  There were 191,000 initial claims last week.

U.S. Trade Deficit8:30 AM: Trade Balance report for September from the Census Bureau.

This graph shows the U.S. trade deficit, with and without petroleum, through the most recent report. The blue line is the total deficit, and the black line is the petroleum deficit, and the red line is the trade deficit ex-petroleum products.

The consensus is the trade deficit to be $65.5 billion.  The U.S. trade deficit was at $59.6 billion in August.

10:00 AM: the Q3 2025 Housing Vacancies and Homeownership from the Census Bureau.

10:00 AM: State Employment and Unemployment (Monthly) for September 2025

----- Friday, December 12th -----
No major economic releases scheduled.

10 Weekend Reads

The Big Picture -

The weekend is here! Pour yourself a mug of Danish Blend coffee, grab a seat outside, and get ready for our longer-form weekend reads:

In the Shadow of Jane Street and Citadel Securities, Hudson River Mints Billions: The quiet flash boy has morphed into a powerhouse among non-bank market makers. (Bloomberg free)

In every corner of the country, the middle class struggles with affordability. The nation’s affordability crisis has not spared middle-class families, one-third of which struggle to afford basic necessities such as food, housing, and child care. Across the 160 U.S. metro areas studied, at least 20% of middle-class earners cannot afford to live in that place, after adjusting for local income ranges and price variations. The share of struggling middle-class families varies by race: 27% of white families, 39% of Black families, 41% Asian, 46% Native American, and 50% of Latino are unable to afford basic necessities. (Brookings) see also ‘The New Price of Eggs.’ The Political Shocks of Data Centers and Electric Bills: Democrats zeroed in on utilities and affordability to win Republican support in upset elections in Georgia and Virginia. Can the same playbook work in 2026? (New York Times)

When Donald Trump Fired David Rubenstein: The private-equity billionaire spent decades building influence in the capital. Then his philanthropy collided with the president. (The Atlantic)

The Airport-Lounge Wars: When you’re waiting for a flight, what’s the difference between out there and in here? (New Yorker)

Is Gen X Actually the Greatest Generation? (no): How one era changed everything about the culture — and why we’re so nostalgic for its creations. (New York Times Magazine)

Ozempic is changing how we spend money and time, plus what we eat: In just over a year, the percentage of U.S. adults taking drugs such as Ozempic, Wegovy, Mounjaro and Zepbound more than doubled to 12.4 percent, according to Gallup. The survey also reported that the obesity rate fell from almost 40 percent in 2022 to 37 percent in 2025. Some companies are already responding by acquiring health food brands, renovating hotel gyms and changing lunch menus. But that’s only scratching the surface, said Diana Melencio, a partner at XRC Ventures, an early-stage venture capital firm. (Washington Post) see also Ozempic and Other GLP-1s Are Now Being Marketed to People Who Aren’t Obese: “You don’t need to be obese to start a GLP-1,” reads an ad from a telehealth startup, the words scrawled in icing on a cake. Another one features a slender woman excited to lose a little weight before her wedding. Yet another says patients can drop 17 pounds in two months by microdosing copycat Ozempic. (Bloomberg) see also Calories In, Calories Out is Preventing You From Understanding Ozempic. People are more likely to talk about GLP-1s as appetite suppressants that happen to have a lot of mysterious, incomprehensible side effects. Why, they ask, do the brain, the heart, the reproductive system, and other organs seem to respond to GLP-1s, sometimes in the absence of significant weight loss? (Eurydice Lives)

The New German War Machine: After World War II, Germany embraced pacifism as a form of atonement. Now the country is arming itself again. (The Atlantic)

The Oceans Are Going to Rise—but When? The uniquely vulnerable West Antarctic Ice Sheet holds enough water to raise global sea levels by 5 meters. But when that will happen—and how fast—is anything but settled. (Wired)

A Mechanistic Framework for Targeted Intervention in Single-Gene Mental Illness: The statistical signatures are unambiguous: individuals carrying GRIN2A: loss-of-function variants face an 87-fold increased hazard ratio for psychotic disorders, 11.8-fold for anxiety disorders, and 5.84-fold for depressive disorders relative to the general population.  The GRIN2A Paradigm: Monogenic Psychiatry and the Precision Phytochemical Revolution. (Shanaka Anslem Perera)

Why One Man Is Fighting for Our Right to Control Our Garage Door Openers: If companies can modify internet-connected products and charge subscriptions after people have already purchased them, what does it mean to own anything anymore? (New York Times)

Be sure to check out our Masters in Business interview this weekend with Paul Zummo, Chief Investment Officer and Co-founder of JPMorgan Alternative Asset Management. The JPM group manages $35 billion in external hedge fund solutions for institutional and high-net worth investors. He also heads the Portfolio Management Group, and is a member of the JPMAAM Investment Committee.

 

How much equity are founders selling to VCs per round

Source: @PeterJ_Walker

 

Sign up for our reads-only mailing list here.

~~~

To learn how these reads are assembled each day, please see this.

 

The post 10 Weekend Reads appeared first on The Big Picture.

The Fed's Turn to Mitigate Japan's Christmas Grinch

Pension Pulse -

Sean Conlon and Pia Singh of CNBC report the S&P 500 closes higher, notching four-day win streak and nearing record after light inflation reading:

The S&P 500 edged higher on Friday, securing its fourth straight winning day, as traders digested inflation data that could provide further incentive for the Federal Reserve to lower interest rates next week

The broad market index closed 0.19% higher at 6,870.40, putting the index about 0.7% off its intraday record. Friday also marked its ninth positive session in 10. The Nasdaq Composite increased 0.31% to settle at 23,578.13, while the Dow Jones Industrial Average climbed 104.05 points, or 0.22%, to end the day at 47,954.99.

The market sorted through a fresh slate of economic releases Friday. The Commerce Department said that the core personal consumption expenditures price index for September – which was delayed due to the record-setting U.S. government shutdown – showed an annual rate of 2.8%, lower than the 2.9% Dow Jones estimate. Core PCE’s 0.2% rise on the month was in line with expectations, as were the monthly and annual inflation readings for headline PCE.

Also on Friday, the University of Michigan’s consumer survey, a report that provides a glimpse at sentiment as well as the view on inflation over the near and longer term, came in higher than expected for December.

The PCE report, which serves as the Fed’s primary inflation gauge, gives the central bank its final inflation view before Wednesday’s interest rate vote. With inflation being mild, jobs remains more in focus after recent reports showed signs of weakening in the labor market. Investors are hoping that this will influence the central bank to lower its benchmark rate by a quarter percentage point when it announces the decision Wednesday.

Traders are pricing in an 87% chance of a cut next Wednesday, far higher than just a couple weeks ago, according to the CME FedWatch tool. The key fed funds futures rate is currently targeted between 3.75%-4%, trading near the high end of that range amid ongoing pressures in short-term funding markets.

“I think it really just solidifies what the market’s already been pricing in, which is almost certainty of a cut for next week,” David Krakauer, vice president of portfolio management at Mercer Advisors, told CNBC. “If inflation does continue to stay somewhat relatively tame and [is] potentially decreasing, then what’s the outlook for more rate cuts into early next year?”

With expectations running high for a rate cut, Krakauer doesn’t necessarily believe that it will serve as a catalyst for stocks to move higher as the new year approaches. That said, he still thinks the market is in a healthy position for some upside, at least enough to reach new highs on the S&P 500.

“It may be a steady move, it may be a choppy move, but I certainly see the path for equities forward as being very positive,” he said.

Stocks posted gains for the week. The S&P 500 finished up 0.3% week to date, while the Nasdaq and 30-stock Dow have added almost 1% and 0.5%, respectively.

During Friday’s trading session, Netflix shares seesawed after initially seeing sizable losses earlier in the day following the company’s announcement that it struck a deal with Warner Bros. Discovery to buy its film and streaming assets for $72 billion — a transaction that’s expected to close in 12 to 18 months. Netflix shares were nearly 3% lower, while shares of WBD jumped more than 6%.

The streaming giant’s stock came off its lows of the session after a senior administration official told CNBC that the Trump administration views the deal with “heavy skepticism.”

Rian Howlett , Karen Friar and Ines Ferré of Yahoo Finance also report the S&P 500, Nasdaq notch fourth day of gains with next week's Fed meeting in focus: 

US stocks moved higher on Friday as Wall Street digested a cooling in the Federal Reserve's preferred inflation gauge, increasing the odds that the central bank will cut rates next week.

The S&P 500 (^GSPC) rose 0.19%, within striking distance of its first record close since October. The Nasdaq Composite (^IXIC) also gained about 0.3%, eyeing its ninth positive close in 10 sessions. The Dow Jones Industrial Average (^DJI) rose around 0.2%, following a mixed Thursday session for the gauges.

Investors continue to bet heavily on a quarter-point interest rate cut from the central bank next Wednesday. Traders are pricing in 87% odds of a move lower, compared with 62% a month ago, according to CME FedWatch.

On Friday, a delayed reading of the PCE price index showed inflation rose about as expected in September. The "core" PCE index — the Fed's favored price gauge — cooled slightly, rising 2.8% on an annual basis. Meanwhile, US consumer confidence rose for the first time in five months as respondents' inflation expectations improved.

The jobs market, meanwhile, has presented more of a mixed bag of data this week. A Challenger report on Thursday showed US companies cut 71,000 jobs last month, the worst November print since 2022. Yet new weekly jobless claims fell to their lowest since September 2022, reinforcing the picture of a labor market cooling gradually rather than rapidly.

Meanwhile, news landed that Netflix (NFLX) will buy Warner Bros. Discovery's (WBD) studios and its streaming unit for $72 billion, following a weeks-long bidding war. Netflix stock ticked down 3%, while WBD shares moved 6% higher.

In earnings, Hewlett Packard Enterprise (HPE) stock rose slightly after the server maker's quarterly sales outlook missed high AI-fueled expectations.

S&P 500 hovers near record, while bitcoin has decoupled from stocks

S&P 500 (^GSPC) was a stone's throw away from reaching a new high on Friday, while bitcoin (BTC-USD) tumbled below $90,000 per token.

The world's largest cryptocurrency is on pace to close out the year decoupled from stocks for the first time since 2014.

Bitcoin is down roughly 3% year-to-date compared the the S&P 500's 17% gain.

It hovers about 30% off its all-time high, north of $126,000 in October. 

Alright, a strong week in stocks all based on expectations the Fed will cut 25 basis points next week. I have no doubt the Fed will cut as employment is trending lower but given the stock market is a leading indicator and all stock indices including small caps are flirting with record highs, it's hard to envision more rate cuts in the new year. Interestingly, Bank of America strategist Michael Hartnett is warning that a dovish Fed rate cut could imperil the rally: 
“Only thing that can stop Santa Claus rally is dovish Fed cut causing a selloff in long-end,” Hartnett wrote in a note, referring to Treasuries with a longer maturity date. US stocks have rallied as investors bet the central bank would reduce rates further to shore up a softening labor market. Wagers on a quarter-point cut at the meeting on Dec. 10 have soared to over 90% from 60% just a month prior, according to swaps markets. Traders have also fully priced in three cuts by September 2026. 

The S&P 500 is now about 0.5% away from its October peak, and seasonal trends generally bode well for a year-end rally. However, this time the market faces two risk events in the form of key jobs and inflation reports due later in December after being delayed by the government shutdown.

Hartnett and his team also note that the US administration is likely to intervene to stop inflation from running hot and the unemployment rate rising to 5%. They recommend positioning for that possibility by buying “inexpensive” mid-caps into 2026. They also see the best relative upside in sectors linked to the economic cycle, such as homebuilders, retailers, REITs and transportation stocks.

The strategists had reiterated a preference for international equities through 2025, a call that proved correct as the S&P 500’s  advance trailed a  rally in the MSCI All-Country World ex-US index. 

So, is Hartnett right, will stocks sell off if it's a dovish rate cut? I wouldn't be surprised if there's a "sell the news" initial reaction but in the weeks following the December rate cut, I expect stocks to continue grinding higher until March, with volatility of course. The reality is with fiscal and monetary policy being accomodative, it's hard to envision stocks selling off right now as we head into the new year.  And even though US Treasuries sold off this week, I expect yields to behave as employment growth and inflation expectations remain muted. The bigger story today was in Canada: 

A much bigger selloff in Canadian government bonds Friday, sparked by stronger-than-expected employment data, was a factor. But US yields had already risen to weekly highs.

The US 10- and 30-year yields climbed more than 12 basis points since Nov. 28, with the 10-year closing at 4.14%.

The move held after the delayed release of September personal income and spending data — which includes the inflation gauge the Fed aims to keep around 2% — showed that it accelerated to 2.8%, as economists estimated. Several Fed policymakers have said the inflation trend should forestall rate cuts.

I know a really good Canadian fixed income trader who got dinged today but I agree with him, employment trends in Canada are not strong, the data was stronger than expected because of part-time workers and I'd remain long Canadian bonds here/ short the loonie. What else? The big news today was Netflix (NFLX) will buy Warner Bros. Discovery's (WBD) studios and its streaming unit for $72 billion, following a weeks-long bidding war. Netflix stock lost 3% today, while WBD shares gained 6%. Is Netflix a buy here? I have no idea what will happen with this acquisition as it will face political and regulatory scrutiny but it's a good time to initiate a position in Netflix but don't expect it to pop back up to a new high any time soon (can go lower before it stabilizes): 
With or without Warner Bros. Discovery, Netflix will remain a global powerhouse and a defensive tech stock that does well even in a downturn (the last hing people cut in desperation in their Netflix). But the stock moves violently to the downside sometimes like it did back in 2022 so you need to remain alert and humble even if I think a nice buying opportunity is emerging here. What else? On Wednesday Oracle reports and we shall see the post-earnings reaction as the stock has sold off recently quite a bit on debt concerns: 
It could pop back over $250 or drop back to retest its recent low of $185, nobody really knows, but sentiment is so bearish on this stock that I wouldn't be surprised if it reaccelerates up if earnings are good. Either way, it's a leader in ts field and just like Netflix, you need to see these selloffs as an opportunity to add or initiate a position (imho). Of course, this week was all about banks (US and Canadian) with a lot of them making new highs. I invite you to carefully scroll down the list of stocks making a new high here (you should be doing this every single trading day to see where strength lies).  Lastly, I know there is a lot of angst on the spillover from surging Japanese bond yields but I agree with Dhaval Joshi of BCA Research, the idea that, past a certain point, Japanese government bond yields could trigger a global stock-market meltdown is pretty far-fetched: 
"There isn't a critical level [for Japanese bond yields] that is going to cause a tsunami of capital flooding back to Japan. That's not going to happen," Joshi said.   
I've seen this "yen carry trade unwind" story so many times in the past 25 years that I tend to be more skeptical about a potential global stock market rout from rising Japanese bond yields. Alright, let me wrap this up with the best performing US large cap stocks this week:  Below, Andrew Davis, Bryn Mawr Trust Advisors SVP & Head of Macroeconomic Research, joins 'Fast Money' to talk the current state of play in teh market and how to position going into next year.

Also, Jeremy Siegel, Wharton professor emeritus and WisdomTree chief economist, joins 'Closing Bell' to discuss Siegel's thoughts on equity markets, if investors are afraid of missing out on equity markets growth and much more.

Lastly, Bloomberg's Asia Trade discusses how Japan's 2-year yield hit the highest level since 2008.

The War On Pete Hegseth

Zero Hedge -

The War On Pete Hegseth

Authored by 'Cynical Publius' via American Greatness,

I have had enough. I can no longer sit still while the Deep State does its very best to smear Secretary of War Pete Hegseth and have him removed from his post via lies, rumors, propaganda, and innuendo. It feels exactly like version 2.0 of the “Trump/Russia Collusion” disinformation campaign, and it needs to be called out for what it is.

Enough.

I am here to defend the best Secretary of War/Defense since Caspar Weinberger.

What we have seen in the last few weeks is clearly an orchestrated, carefully constructed character assassination campaign against Hegseth.

The campaign began in the early days of November when the leaders of the Sedition 6 introduced legislation known as the “No Troops in Our Streets Act,” legislation clearly designed to undermine the roles of President Trump and Secretary Hegseth in the military chain of command. Then, of course, on November 18, the Sedition 6—led by Senators Mark Kelly and Elisa Slotkin—launched their infamous video calling (via innuendo and plausible deniability) for military members to disobey lawful orders they disagree with politically by pretending such lawful orders are “unlawful.” For the next eight days, the Deep State went into a full media onslaught that seemed designed to foment a military mutiny against Trump and Hegseth. Suddenly, these wannabe seditionists were forced to hit the brakes on their information operation, as on November 26 two West Virginia National Guard soldiers patrolling the streets of Washington, D.C., in support of anti-crime operations were shot by an Afghan civilian with former ties to the CIA, and America saw an easy connection between that attack and the calls to undermine Trump, Hegseth, and the anti-crime mission.

But the Deep State never rests and was quick to shift gears and change the subject away from their own perfidy. On November 28, the Washington Post published its anonymously sourced hit piece on Hegseth, alleging that he personally directed war crimes, and in a matter of minutes, the entire Democrat hierarchy and its minions in the national media ran with Nancy Pelosi’s beloved “wrap-up smear” in a transparent effort to remove Hegseth.

We now know, of course, it was all a lie. The Democrats and the national media want you to believe that two “fishermen” survived a first strike on their drug-laden speedboat and were then floating in the water helplessly like Rose and Jack at the end of “Titanic,” and we gunned them down as helpless victims and in violation of the Geneva ConventionsIn reality, the two narco-terrorists were back on board their partially damaged boat, seeking to conduct damage control and recover their WMD cargo. The narco-terrorists and their lethal cargo were lawful targets under all U.S. laws and all treaties to which the U.S. is a party. No war crimes were involved—just an effective and entirely lawful military strike on narco-terrorists who kill thousands of Americans annually. The Washington Post lied, as is its wont in any matter involving the Trump Administration.

But the damage was done, and too many Americans are still clinging to the lies. In fact, it was an opinion piece I saw today by the desiccated remains of George Will, published in that same Washington Post and uncritically repeating all of that tabloid’s original lies, that pushed me over the edge and caused me to rise to the defense of Pete Hegseth with this article.

As a veteran of the same wars Hegseth fought in and as a retired Army colonel who also fought the Beltway wars of the Pentagon, I take the attacks on Hegseth personally, as he is trying to fix all of the ills that I saw so clearly in my time in service. My sincere belief is that at this time in American history, Pete Hegseth is the perfect person to serve as Secretary of War.

I’ll explain why.

America’s military spent 20+ years engaged in a GWOT battle that, after its first few years, became a predominantly political, economic, diplomatic, and law enforcement mission where the military was not the right tool in the DIME-FIL (DIME-FIL = The “elements of national power” under U.S. military doctrine, or diplomatic, informational, military, economic, financial, intelligence, and law enforcement) toolbox. “Nation building,” ridiculously restrictive, JAG-inspired rules of engagement, social justice experimentation, Military Transition Teams and Security Force Assistance Brigades, and the bastardization of combat arms units away from their mission-essential tasks all created a U.S. military that was risk averse to a crippling degree, lacked adequate training and equipment readiness levels for high-intensity conflict, had broken morale and poor retention/recruiting, and was more concerned about DEI than closing with and destroying the enemy.

The military that Donald Trump inherited from Joe Biden in January of this year was a broken shell of the military that entered the GWOT in 2001. It had lost its focus on lethality, valued skin color and genitalia more than warfighting competency, and was not even able to fully recognize its own missions in a world rife with peer competitors bent on high-intensity global or regional domination, such as China and Russia. Yes, low-intensity conflict was still on the menu in places like Yemen, Syria, and the battles against narco-terrorists, but a military trained for high-intensity conflict can adjust to low-intensity conflict quickly, but it does not work so well the other way around.

As Donald Trump took office, what America needed was a Secretary of War who was intimately familiar with these failures—somebody who had fought those GWOT battles and understood our failings deep in his or her soul. Such a person could not be one of the Perfumed Princes who engineered and would repeat our failures. Instead, it needed to be someone with muddy boots who had experienced the mess we had become at a deeply personal, tactical level.

Moreover, it needed to be someone who understood information operations and the climate of global, instantaneous messaging that is our new day-to-day.

This person did not need to have a comprehensive understanding of military procurement and the military/industrial complex that accompanies Beltway jockeying with Congress and defense contractors—those skills are widely available and could easily be obtained by hiring effective subordinates with the shared vision of a military that needed to be once again focused on lethality.

What might such a person have looked like?

Well, he or she would need to have the following qualifications:

  1. A military career that involved killing the enemy up close and personal in the most efficient manner possible. An infantryman, if possible. A Combat Infantryman Badge would be double plus good.

  2. Muddy boots experience leading troops in direct combat in Iraq and/or Afghanistan.

  3. Deep experience in leading one of the failed coalition training missions in Iraq or Afghanistan.

  4. Someone who shared the dark personal struggles of every veteran who had come home from our endless wars.

  5. A final military rank that meant he or she was never a Perfumed Prince and was never polluted by the Beltway mind virus that seems to infect every soldier, sailor, airman, Marine, or Guardian who ever pins on a star.

  6. Deep experience in information operations, such as being a best-selling author on military affairs or being a military expert on a major news network.

Those are the qualifications that were needed to turn America’s military around and restore it to once again being the premier warfighting force in world history. We did not need more of the same. We did not need a former Raytheon board member. We did not need a former congressman who cared more about politics than winning wars. We did not need yet another retired general who was an architect of our useless, endless wars. What we needed was someone who truly understood the errors of the GWOT, understood that the mission of the U.S. military is to close with and destroy the enemy in the most violent and expeditious manner possible, and who had the chops in the 24/7 modern information environment to wage information warfare just as effectively as his opponents.

One American and one American only had those qualifications: Pete Hegseth, and that man is doing everything I could have ever hoped for to restore the pride and skill we have lost. His focus on lethality and warfighting skill is the one and only antidote to the intentional failures that have scarred veterans like Hegseth and me over the past 24 years.

Please realize this: Hegseth is a threat to anyone who prefers the Obama/Biden vision of an impotent social justice military. He is a threat to anyone who thinks R2P (R2P = “Responsibility to Protect,” i.e., a leftist, globalist doctrine popularized under the Obama Administration that says the U.S. military has a core mission of protecting foreign populations against the deprivations of their own or neighboring governments or warlords. Although legitimate in some instances, it prioritizes the national interests and lives of foreigners over the national interests of the USA and the lives of American servicemen and servicewomen) is a core competency of the American military. He is a threat to anyone who thinks enriching the military/industrial complex is more important than winning wars. Basically, he is a threat to anyone who sees the military as a politicized force and not an effective warfighting endeavor. In other words, Hegseth is a threat to the Beltway defense establishment that has exchanged failure for dollars since the days of Robert McNamara.

Which is why it is so very, very important that the same defense establishment (elected, unelected, and media) smear him in every way imaginable and at every opportunity. When you see and hear the abject lies of the Sedition 6 and their ilk, and when you see and hear wholly fabricated, libelous stories like the “Kill Them All” Hoax, realize why this is happening. These fake news stories are designed to attack and defeat an existential threat to the leftist vision of a social justice American military that exists to enrich defense industry campaign contributors.

Like Donald Trump, Pete Hegseth is an existential threat to the leftist evils that nearly defeated America and the Constitution via Barack Obama and Joe Biden.

It takes a strong man to withstand the onslaught of the Deep State, with all of its lies, libel, and propaganda. Donald Trump is one man who withstood that fire of infamous defamation. Pete Hegseth is another.

We all owe Pete Hegseth our gratitude for the personal cost he is enduring in the name of freedom. He could be sitting at home enjoying his writings and his Fox News appearances. Instead, he is enduring the cowardly slings and arrows of powerful liars as he strives to fix the ills that have long beset our nation’s military.

The disgusting disinformation campaign against Hegseth needs to be challenged vigorously, and I encourage all of you readers to help lead the counterattack.

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

Tyler Durden Fri, 12/05/2025 - 17:40

World Risks 'Disintegration Of The International Order' As Macron Fails To Woo Xi Into Pressuring Putin

Zero Hedge -

World Risks 'Disintegration Of The International Order' As Macron Fails To Woo Xi Into Pressuring Putin

"We are facing the risk of the disintegration of the international order that brought peace to the world for decades, and in this context, the dialogue between China and France is even more essential than ever," Macron said on Thursday while on a tour of China. It was his fourth state visit, and part of a renewed effort to woo Chinese President Xi Jinping to the West's side on stepping up pressure on Russian President Vladimir Putin.

"I hope that China will join our call, our efforts to achieve, as soon as possible, at the very least a ceasefire in the form of a moratorium on strikes targeting critical infrastructure," the French leader said. But the consensus is that Macron's latest effort has once again failed to gain anything in the way of a concession from Xi on the Ukraine issue. 

Xi only vaguely stated that "China supports all efforts that work towards peace" while urging a peace deal that all parties would accept, in a clear nod to Moscow's position that there are still a number of unsatisfactory aspects to the Trump-proposed peace plan.

via Reuters

President Xi also interestingly used language and themes often employed by Putin, for example stressing the needs to carry on the "banner of multilateralism" when it comes to China-France relations:

"No matter how the external environment changes, both sides as major powers should always demonstrate independence and strategic vision, show mutual understanding and mutual support for each other on core matters and major critical issues," he said.

"China and France should demonstrate their sense of responsibility, raise high the banner of multilateralism ... and firmly stand on the right side of history."

Friday's commentary from Rabobank says this is all a case for pessimism when it comes to the closeness or else great distance of a potential Ukraine peace deal:

The kind of multilateralism that Xi has in mind is an important point to consider. Is Xi talking about an idealistic evolution of the United Nations where more power is given to the developing world but disputes are resolved via dialogue? Or is he talking about ending US hegemony to carve the world up into spheres of influence for regional great powers to preside over? Xi’s reluctance to get involved in brokering a peace deal in Ukraine and recent naval deployments in the wake of a diplomatic spat with Japan will make many nervous that it is the latter.

A spheres of influence paradigm is certainly favorable in the eyes of Vladimir Putin. He has reportedly rejected the latest peace overtures from US special envoy Witkoff and told India Today that Ukrainian troops will either leave the Donbas region or Russia will “liberate these territories by force”. Kremlin officials have reportedly told journalists that a peace deal remains a long way off. The Wall Street Journal editorial today says “maybe it is time to conclude that Mr. Putin doesn’t want peace” while arguing that Putin has no incentive to negotiate in good faith while he feels that he is winning.

So, peace in our time? Don’t count on it.

European leaders have not been pleased that the US plan is the first to ever seriously offer territorial concessions since the war's start. Some European officials alongside media reports in the EU have gone so far as to accuse Putin of 'faking' interest in peace efforts.

While the Kremlin has called the prior Tuesday Moscow talks involving Steve Witkoff and Jared Kushner "constructive" - it conceded that little actual progress was made toward a deal, given Russia is demanding nothing less than full legal and international recognition of the territories under its control

Putin has followed up with a warning that Russia is ready seize more Ukrainian territory as the 'special military operation' continues. "Either we liberate these territories by force of arms. Or Ukrainian troops leave these territories," he has freshly warned.

Images from Macron's three-day rare "sightseeing" tour of China with President Xi:

Mutual strikes on energy infrastructure are only continuing to escalate. President Putin has also warned his military is readying to expand strikes on Ukrainian ports, in retaliation for a spate of drone attacks on tankers transporting Russian oil to global markets.

With Ukraine peace being elusive, apparently, Xi and Macron handled a series of lesser matters Thursday and Friday," EuroNews reports. "They signed 12 agreements, including ones calling for cooperation on a new round of panda conservation efforts and exchanges in higher education and research." The same report notes that the European Union "ran a massive trade deficit with China of more than €300 billion last year. China alone represents 46% of France's total trade deficit."

Tyler Durden Fri, 12/05/2025 - 17:20

Watch: Biden Called For Strike Force To Crush Drug Cartels In 1989!

Zero Hedge -

Watch: Biden Called For Strike Force To Crush Drug Cartels In 1989!

Authored by Steve Watson via Modernity.news,

Democrats are melting down over Trump’s targeted strikes on narco-terrorists, yet a freshly resurfaced clip shows Joe Biden demanding the same aggressive action decades ago, proving their opposition is pure partisan sabotage as cartel poison floods America unchecked.

A 1989 C-SPAN clip of then-Senator Joe Biden has gone viral amid the Trump administration’s boat strikes on drug runners, highlighting the glaring double standard from Democrats who now baselessly cry “war crimes” over actions Biden once championed.

In the speech, Biden urged, “Let’s go after the drug lords where they live with an international strike force. There must be no safe haven for these narco-terrorists …”

What changed? Under Biden’s presidency, fentanyl deaths skyrocketed, with cartels controlling swaths of the border and trafficking exploding to record levels. Now, as Trump delivers on promises to hit back hard, Dems side with the traffickers out of sheer Trump derangement.

The clip, from a February 7, 1989, Senate hearing on crime and drugs, shows Biden pushing for swift, severe punishment of dealers and international operations to dismantle cartels before they infiltrate the U.S. 

He emphasized, “We have to join together to ensure that drug dealers are punished swiftly surely and severely.”

This echoes Trump’s designation of cartels as foreign terrorist organizations, a move Biden never pursued despite his tough talk.

Fast-forward to 2025, and Trump’s team is executing precision strikes on vessels linked to Venezuela’s Maduro regime and cartel operations, destroying drug cargoes and neutralising threats in the Caribbean.

Trump security advisor Stephen Miller blasted Democrats Wednesday for their twisted priorities in an explosive interview.

Miller declared, “This is the first time I can EVER think where a major political party has sided with narco-trafficking, murdering, terrorist SCUM!”

He added, “A Democrat says ‘oh, there’s no such thing as a narco-terrorist. They’re just narco-persons!’ ISIS and these narco-terrorists in our hemisphere use the same tactics. They use r*pe as a weapon. They skin people alive. They cut off their heads. They burn them to death!”

Miller further asserted “We’re not going off running around the Middle East trying to ‘build democracies’ in caves and deserts and in distant sands that have never known democracy.”

“We’re using the military to protect American security, American prosperity, American lives right here where we live, where our children live!” he urged.

Democrats, meanwhile, are inciting military discord while soft-pedaling cartel savagery. As we covered earlier, Virginia Sen. Mark Warner echoed seditious calls on MSNBC, stating “the uniformed military may help save us from this president.”

Warner ranted, “I’m going to want to get answers on what did Pete Hegseth order? Why haven’t we seen the whole unedited video if there’s nothing inappropriate here? You could have cleared this up without the admiral coming in. He’s got a great reputation, I respect him. I want to get the truth. And I’m not sure we’ve had the truth from Hegseth yet.”

Fresh reporting dismantles media smears. The New York Times revealed Hegseth authorized a Sept. 2 strike “to kill the people on the boat, destroy the vessel, and eliminate its drug cargo,” but it “did not specifically address what to do if a first missile failed to fully accomplish these goals, and it was not based on surveillance showing at least two survivors after the initial blast.”

White House press secretary Karoline Leavitt clarified Hegseth “authorized Adm. Frank M. Bradley to conduct kinetic strikes, ensuring the boat was destroyed and the threat eliminated.”

In addition, ABC’s Martha Raddatz provided key updates on ‘World News Tonight’, noting  “According to a source familiar with the incident, the two survivors climbed back on to the boat after the initial strike. They were believed to be potentially in communication with others, and salvaging some of the drugs.”

Raddatz added, “Because of that, it was determined they were still in the fight and valid targets.”

This confirms the strikes followed rules of engagement, with legal oversight—completely debunking Dem hysteria.

Your support is crucial in helping us defeat mass censorship. Please consider donating via Locals or check out our unique merch. Follow us on X @ModernityNews.

Tyler Durden Fri, 12/05/2025 - 17:00

Was The J6 "Insurrection" A Government-Sponsored Seditious Conspiracy?

Zero Hedge -

Was The J6 "Insurrection" A Government-Sponsored Seditious Conspiracy?

Authored by James Howard Kunstler,

Cold Case Heats Up

"[The current FBI] was competent at cracking the case; [Christopher Wray's] was competent at corruption and obstructing it."

- Mike Benz

Do you have any idea what tapestry of corruption and crime is attached to the little thread of the J6 / DNC / RNC pipe bomber suspect arrested yesterday by the FBI? Consider this: suspect Brian Cole, Jr., is alive and probably talking, unlike, say, Jeffrey Epstein and Thomas Matthew Crooks in other matters of public interest. Let’s hope he is under FBI protection in custody, lest something. . . say. . . happen to him.

Dressed for government work?

As of early this morning, the country knows next to nothing else about Cole and what he was up to the night of Jan. 5, 2021.

The FBI has not even said how he is employed. But his photo shows a young man dressed for office work. . . he lives in a nice house in the DC suburbs of Virginia. . .and you might infer that he is, possibly, a federal government worker. Oh, and the FBI was unable to catch him through the whole four years of “Joe Biden?”

You can suppose at this point that the story of that four-year botched investigation will be a way bigger thing than the pipe bomber’s little prank itself.

It probably leads to the story of wholesale corruption in Christopher Wray’s FBI, and even more consequentially, to the realization that the so-called J6, 2021 “insurrection” was a government op from top to bottom, aimed at eradicating Trump and Trumpism.

First, what was supposed to happen in a joint session of Congress that day?

Answer: certification of electoral college votes in the 2020 election. What else was liable to happen that day? Answer: under the Electoral Count Act of 1887 (3 U.S.C. §§ 5–6, 15–18) — as amended, and by the rules laid out in the U.S. Constitution (Article II and the 12th Amendment) — objections to several states’ slates of electors were expected to be entertained, triggering debate and possible rejection of those states’ electors on the basis that the votes were not “lawfully certified” (under 3 U.S.C. § 6), or not “regularly given” (meaning the vote was marred by fraud, corruption, or violence). Any state’s electoral votes could be rejected if both the House and Senate voted by simple majority, after up to two hours of separate debate.

At mid-day, objections meeting the written requirement (one House member + one Senator) were filed for Arizona and Pennsylvania. The objection to the Arizona vote (Rep. Paul Gosar + Sen. Ted Cruz) was the first scheduled to be debated shortly after 1:00 p.m. It was not allowed to happen. Instead, Congress evacuated the chamber. When Congress returned at 8:00 p.m., votes objecting to Arizona and Pennsylvania slates failed and no others were taken up. Senators who previously had committed to debating the votes of several other swing states demurred, citing the breach of demonstrators into the Capitol. The full tally concluded at 3:44 in the morning, Jan 7, “Joe Biden” and Kamala Harris were certified as winners of the 2020 election.

Here are some things to know about the pipe bomb subplot in the J-6 story.

Kamala Harris, vice president-elect, still a sitting Senator (CA), was not in the chamber for the certification process. She arrived at the DNC headquarters some blocks away from the Capitol by motorcade at 11:30 a.m. and stayed until she was evacuated from the DNC at 1:14 p.m. Couple of questions about that? 1) did she not want to be present in the chamber at the momentous instant that her election as veep was certified? 2) Did she not have a duty to be present for voting on any of the procedure? Weird, a little bit. She has never explained what she was doing at the DNC that day.

Kamala Harris was in the DNC building when the pipe bomb was discovered there, around 1:07 p.m. The pipe bomb at the RNC had been discovered some 20 minutes prior, and it was the discovery of that bomb, at 12:44 p.m. that prompted the evacuation of the joint House / Senate session in Congress, not any breach of the Capitol building, which did not occur until 2:13, p.m., more than an hour later.

Now, to the FBI response to all this.

They quickly collected tons of closed-circuit video of a suspect planting these pipe bombs. The footage they released showed the suspect at a one-frame-per-second recording rate which, as Mike Benz points out, is a hundred times slower than any common gas station closed circuit camera nowadays. The FBI also doctored the recordings, specifically blurring out the section of the suspect’s face at one angle captured by a CC camera about eight meters away. The rectangular blur patch over his eyes can be clearly seen. How’d that happen?

The FBI also managed to botch every other aspect of the investigation into the act that actually triggered the evacuation of Congress that day — which was (repeat) not the breach of the Capitol building but the pipe bombs. In the months afterward, FBI Director Wray took agents off the case. He had in place as chief of the FBI’s Washington office an assistant director named Steven D’Antuono who had been in charge previously, as Detroit field chief, of the Gretchen Whitmer kidnapping case in which at least 12 confidential informants and three FBI agents were involved in what looked like an entrapment scheme. D’Antuono had demonstrated considerable skill in constructing skeezy FBI ops when he was put in charge of the DC office. The agency managed to lose the chain-of-custody for much of the evidence in the case, including originals of the videos, cell phone records, communications records between Capitol police, DC metropolitan police, Secret Service, and the FBI, and more.

So, the pipe bomber has been a cold case lo these many years. And now we’re informed as of yesterday’s FBI / DOJ press conference, that the FBI under Director Patel cracked the case using only information and evidence already in the FBI files. So, get this: there must be a record of exactly which agents were on the pipe bomber case those four years under Christopher Wray. There must be a record of who, by name, was in charge of chains-of-custody for all that evidence. And there must be a record of the senior agents and deputy directors who oversaw all their activities, all the way up to Director Wray. Why would they not be subject to charges of obstruction of justice?

All of this is just the pipe bomber subplot of the J6 story. There remains the weird business with then House Speaker Nancy Pelosi and her failure to request national guard protection at the US Capitol that day. And there remains the question of how many agents, assets, and confidential informants the FBI had in-place at the Capitol on J6, 2021, including Antifa members, and which actions, including the breach inside the building, they instigated. Then there is the question of the House J6 committee, how it was constructed with the help of lawfare ninja Norm Eisen, and how it deliberately destroyed all the evidence it collected over the months of its existence.

Be prepared to learn how the J6 “insurrection” was a government-sponsored seditious conspiracy and then ponder who, by name, will be held responsible for it. That’s the tapestry that Brian Cole, Jr.’s little thread leads to.

Shout out to Mike Benz for his nearly four-hour discussion about the pipe bomber case on “X”.

Tyler Durden Fri, 12/05/2025 - 16:20

AAR Rail Traffic in November: "Continued Economic Uncertainty Reflected in Rail Volumes"

Calculated Risk -

From the Association of American Railroads (AAR) AAR Data Center. Graph and excerpts reprinted with permission.
Continued Economic Uncertainty Reflected in Rail Volumes
...
In November 2025, total U.S. rail carloads were up 1.5% over November 2024, and 9 of the 20 major rail carload categories posted year-over-year gains. ...

U.S. rail intermodal shipments, which are driven primarily by consumer goods, fell 6.5% in November 2025 from November 2024. Year-to-date intermodal volume through November was 13.00 million containers and trailers, up 1.9% (nearly 247,000 units) over last year.
emphasis added
Intermodal
The AAR Freight Rail Index (FRI) combines seasonally adjusted month-to-month rail intermodal shipments with carloads excluding coal and grain. The index is a useful gauge of underlying freight demand associated with the industrial and consumer economy. The index fell 0.4% in November 2025 from October 2025, its seventh decline in the past eight months. The index is 4.4% below its year-earlier level, largely because of the intermodal slowdown in recent months.

Full Metal Retard: Walz Rolls Out Taxpayer-Funded Paid Leave For Illegals

Zero Hedge -

Full Metal Retard: Walz Rolls Out Taxpayer-Funded Paid Leave For Illegals

Less than one week after the NY Times (of all rags) torched Minnesota governor Tim Walz over a massive and sprawling fraud scandal involving Somalians that federal prosecutors say siphoned over $1 billion from the state's social safety net programs, Walz is opening yet another avenue for fraud - giving taxpayer-funded leave illegal immigrants.

Under the Minnesota Paid Family and Medical Leave Program which Walz signed into law ahead of its Jan. 1 start date, "undocumented workers" will receive benefits, according to the Minnesota Chamber of Commerce's FAQ page

The program provides payments to Minnesota residents who need time away from work for "serious health" reasons, or to take care of a family member - be it an infant or an ill relative, the Washington Examiner reports. What's more, if an individual qualifies for both medical and family leave, they can "double dip" - getting taxpayer funds for a total of 20 weeks or 5.5 months, each year. These receiving benefits can also "top off" paid leave by using paid time off (PTO), sick days, and vacation hours in addition to their leave of absence. 

Program beneficiaries will receive between 55% and 90% of their regular wages while on paid leave - up to a maximum amount of $5,692 per month. 

"Are people going to abuse the program?" Walz replied when questioned on Tuesday at an event about potential fraud. "How disrespectful to people to assume that ailing Minnesotans are scamming. That’s what I hear from [critics] all the time. I trust Minnesotans."

"I believe they know you’re not gonna get rich, and it’s not your full salary. You’re not gonna scam and take time off," Walz continued. 

Meanwhile, Walz continues to downplay growing concerns after a $1 billion fraud was uncovered by City Journal, in which Somali immigrants were stealing welfare funds and funneling the money home to Somalia. 

The fraud involved a series of schemes that federal authorities say took root over the past five years, many centered within Minnesota’s Somali diaspora, where individuals established companies that billed state agencies for services that were never performed. Prosecutors say 59 people have been convicted across various cases so far, in three separate plots.

Minnesota’s fraud scandal stood out even in the context of rampant theft during the pandemic, when Americans stole tens of billions through unemployment benefits, business loans and other forms of aid, according to federal auditors. - NYT

Federal prosecutors have emphasized the seriousness of the cases being prosecuted by career federal attorney Joseph H. Thompson - who warned that the scale of fraud threatens public confidence. “No one will support these programs if they continue to be riddled with fraud,” Mr. Thompson said. “We’re losing our way of life in Minnesota in a very real way.

Also meanwhile, Minnesota is awarding public outreach grants to community groups that are focused on "equity" and helping "priority populations" including minorities, LGBT people, immigrants, and people who can't speak English. 

Funding for the grants comes from a portion of the annual projected PFML payments. For fiscal 2026, grants will be awarded from an available fund of $1.9 million, increasing to $3.7 million the following year.

‘The next big fraud scandal in Minnesota’

Some policy experts are raising fraud-related concerns about bad actors abusing the paid leave program, especially exploiting the minimal eligibility criteria that allow illegal immigrants to benefit from the coverage plan.

Why are Minnesota taxpayers, which I’m one, funding people who, legally speaking, should not be in America or in Minnesota?” questioned Bill Glahn, a policy fellow at the Minnesota-based Center of the American Experiment.

Proponents of PFML, however, believe that illegal migrants should reap the rewards if they pay into the program via the payroll tax, which is split between employers and employees, whose half is deducted from their wages. -Washington Examiner

Evidence continues to mount that Walz is, as President Trump claims, a complete retard

Tyler Durden Fri, 12/05/2025 - 15:40

Consumer Credit Below Expectations On Slowdown In Student, Auto Loans; Credit Card APRs Back To All Time High

Zero Hedge -

Consumer Credit Below Expectations On Slowdown In Student, Auto Loans; Credit Card APRs Back To All Time High

After several months of wild swings, moments ago the Fed published the latest consumer credit report (G.19) and it was quite tame by recent volatile trends.

Total consumer credit rose by $9.178BN in October (which is more contemporaneous than more other data points we have received in recent weeks thanks to the govt shutdown), which was down from a downward revised $11.0BN in Sept ($13.09BN pre-revision), and below the $10.48BN median estimate. The latest monthly increase pushed the total to a new all-time high of $5.084 trillion. 

Looking at revolving credit (i.e., credit cards), the increase was $5.407BN to $1.317 trillion, the biggest monthly increase since July, if on the low side compared to the $8.7 billion average monthly increase from 2021 until the end of 2024.

Non-revolving credit (primarily auto and student loans), rose by $3.771BN, the lowest increase since February when we saw a decline of $2.4 billion. This increase brought the total nonrevolving credit to $3.767 trillion, a new record high.

While there was no detailed breakdown for October, the historical data showed that when broken down by components, student loans - now that the repayment moratorium is over - surged by $27.4 billion in Q3 to a record $1.841 trillion. As discussed previously, student loans have a magical capability of being abused for everything but college, which is why enterprising "students" binge on them any time they can to fund all their other purchases, except education-related. Meanwhile, car loans rose by a far more modest $4.0 billion to $1.564 trillion.

A few weeks ago Kelley Blue Book reported that the average new car price hit $50,000 for the first time ever. Well, as the next chart shows, there's a reason why: it's because the amount finance by new car loans also hit a new record high of $41K.

Finally, and this will come as a surprise to nobody, despite 1.50% in rate cuts by the Fed since last September, we can now confirm that rates on credit cards have gone... higher, as banks continue to bleed US consumers dry: at the start of 2025 the average rate on credit card accounts was 22.80%... and on Sept 30 the number was higher at 22.83%, just barely below the all time high of 23.37% set one year ago.

Tyler Durden Fri, 12/05/2025 - 15:30

Supreme Court Will Hear Trump Birthright Citizenship Case

Zero Hedge -

Supreme Court Will Hear Trump Birthright Citizenship Case

Authored by Matthew Vadum via The Epoch Times (emphasis ours),

The U.S. Supreme Court decided on Dec. 5 to review whether President Donald Trump’s executive order ending birthright citizenship is constitutional.

The Supreme Court in Washington on Oct. 20, 2025. Madalina Kilroy/The Epoch Times

The court’s decision took the form of an unsigned order without comment. No justices dissented. The case is known as Trump v. Barbara.

Trump’s Executive Order 14160, signed on Jan. 20, states that “the Fourteenth Amendment has never been interpreted to extend citizenship universally to everyone born within the United States.”

According to the order, an individual born in the United States is not “subject to the jurisdiction thereof” if that person’s mother was unlawfully present in the country and the individual’s father was not a U.S. citizen or lawful permanent resident at the time of the person’s birth.

It also states that the privilege of U.S. citizenship does not apply to an individual whose mother’s presence was lawful but temporary and whose father was neither a citizen nor a lawful permanent resident at the time of that individual’s birth.

The executive order has prompted debate over the meaning of the 14th Amendment’s citizenship clause, which states, “All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside.”

A three-judge panel of the U.S. Court of Appeals for the Ninth Circuit ruled on July 23 that the executive order was “invalid because it contradicts the plain language of the Fourteenth Amendment’s grant of citizenship to ‘all persons born in the United States and subject to the jurisdiction thereof.’”

Before that, the U.S. District Court for the Western District of Washington ruled against the executive order on Feb. 6. That court granted a preliminary injunction blocking the order because it “subjects” the states challenging the order to “immediate economic and administrative harms.”

That court said the executive order would compel the states to disqualify many people it considers citizens and, in the process, cause them to lose federal funds they would otherwise be eligible to receive. The states are likely to succeed on their claim that the executive order violates the 14th Amendment, the court added.

No oral argument in the case has yet been scheduled.

This developing story will be updated.

Tyler Durden Fri, 12/05/2025 - 15:00

Congressional budget amendment and new DOL wage rule together would greatly expand work visas for farmworkers and drastically lower their wages

EPI -

This is Part 1 of a two-part series analyzing the impact of an amendment to the House Homeland appropriations bill on the H-2A and H-2B visa programs.

Key takeaways:

  • The government funding bill for the Department of Homeland Security may include a rider amendment that would expand the H-2A visa program for seasonal farm jobs. This amendment (originally known as Amendment #1 but later dubbed the Bipartisan Visa En Bloc amendment) proposes to open the H-2A visa program to year-round occupations.
  • There were 410,000 year-round jobs in agriculture and 353,000 seasonal H-2A workers in 2024.
  • The Trump Department of Labor has issued a new 2026 H-2A Adverse Effect Wage Rate (AEWR) to set H-2A wages. Based on their own estimates, the 2026 H-2A AEWR will result in a $24 billion pay cut for H-2A farmworkers over 10 years and incentivize growth in the H-2A program to 500,000 jobs a year. EPI has estimated that U.S. farmworkers will lose $2.7 to 3.3 billion in wages per year.
  • If employers are allowed to use H-2A visas for year-round jobs via the House Homeland appropriations rider, farmworkers in those jobs will see massive pay cuts of $20,000 to $40,000 per year, starting in 2026.
  • The Trump DOL wage reductions combined with H-2A visas for year-round jobs could expand the H-2A program to 900,000 workers in 2034, meaning that workers on temporary visas would account for 42% of average annual employment in agriculture.
  • This rider in Congress and the proposed regulation at DOL would only benefit farm employers, allowing them to hire workers they can control for as little pay as possible. These changes would drastically lower pay for all farmworkers and lead to job losses for U.S. workers, a complete reversal from the Trump administration’s original claims that U.S. workers would fill the farm jobs left open due to deportations.

For well over a decade now—time and time and time and time again—Congress has been making policy changes to temporary work visa programs not through the normal process of debating and passing legislation, but through a backdoor process. This involves amendments to annual appropriations legislation (known as “riders”) that fund the U.S. government. Riders that make policy changes are much more likely to pass without much public notice, debate, or pushback relative to dedicated legislation, since they are smaller parts of larger, must-pass legislation to fund the whole U.S. government. The significant changes proposed or passed in riders over the past decade have all pushed temporary work visa programs in the same direction: expanding and deregulating the H-2A and H-2B visa programs, which benefits employers at the expense of U.S. workers and hundreds of thousands of migrant workers who will continue to see reduced wages and poorer working conditions. It’s already clear that low-wage work visa programs won’t be improved during the Trump administration; instead, they’ll be made much worse.

This fiscal year, there is a particular urgency around the riders to expand and deregulate the H-2A and H-2B visa programs, in light of the Trump administration’s mass deportation effort that is arresting and deporting workers at a breakneck pace, as well as canceling temporary immigration protections that provided work authorization to millions. The Trump administration got the ball rolling on this effort with a new proposed H-2A wage regulation issued by the U.S. Department of Labor (DOL) on October 2, 2025. This proposed regulation contains a stunning admission: The administration’s mass deportation effort is likely to raise food prices. DOL’s solution to this problem of the administration’s own creation is an irrational and anti-worker solution. Instead of pushing the administration from within to stop their campaign of mass deportation, DOL proposes to lower farmworker wages by $24 billion over the next 10 years.

Having seen this proposed rule, employers who are heavily reliant on migrant laborers—especially those in the hospitality, construction, and agricultural industries—can now be confident they have a friendly administration willing to dismantle labor standards and are lobbying furiously for more work visas that allow them to employ a vulnerable workforce. Employers are making the case that H-2 visas are “a workforce issue, not immigration,” as well as an essential service that must continue to function even during the recent government shutdown. A number of lawmakers and the Trump administration seem to agree.

The latest legislative vehicle that has a chance at furthering these goals is a rider that the Homeland Security subcommittee of the House Appropriations Committee proposed and passed. It was originally known as Amendment #1 but was later dubbed the “Bipartisan Visa En Bloc” amendment. As Politico Pro reported, “House appropriators from both parties came together…to back big changes to visa policies that would boost the number of seasonal workers who can come to the United States.” The rider was cosponsored by three Republicans and one Democrat (but the Democrat was Henry Cuellar (D-Texas), the recent recipient of a pardon from Trump for federal bribery charges). However, it’s worth noting that because rider passed by a voice vote, there is no on-the-record vote tally showing who voted for it.

The rider still has a long way to go before becoming law and will also depend on whether an omnibus government spending bill is ultimately passed for fiscal year 2026. As of the time of publication, the Senate has not yet released their version of a Homeland Security appropriations bill. To become law, the Senate would also have to adopt the same rider provision for it to become part of the broader omnibus appropriations legislation. Nevertheless, the rider is a statement of intent from legislators who are willing to go to bat for employers seeking new exploitable and underpaid migrant workers to replace their long-term immigrant workers who have been deported or lost status.

Below is a summary of the four major changes that the Bipartisan Visa En Bloc rider amendment would make to the H-2A and H-2B visa programs. Only the first major change is discussed in this explainer, but a follow-up to this blog post will discuss the other three changes. Under the rider:

  • Employers would be permitted to hire H-2A farmworkers to fill year-round jobs.
  • The H-2B visa program would be expanded by at least 100,000 workers relative to its size in 2024.
  • H-2B workers employed at carnivals, traveling fairs, and circuses would be moved to the P visa program, a program that has no wage rules or worker protections and over which DOL has no formal oversight role.
  • DHS would not be permitted to spend funds to implement the January 2024 regulation that incrementally improves rights and protections for H-2A and H-2B workers. This regulation allows them to be eligible for green cards through existing pathways and helps them more easily change employers, reducing the indentured nature of the visa programs, and requires additional scrutiny on employer applications if they’ve committed certain violations.
The H-2A program has expanded rapidly and is rife with abuse

Employers use the H-2A visa program to fill seasonal and temporary jobs in agriculture, after employers go through a (mostly pro forma) process to prove that they could not find an available U.S. worker to hire. There is no annual limit on the number of H-2A workers that can be hired, and H-2A has in recent years been the fastest-growing U.S. work visa program, tripling over the past decade. Figure A shows the three available data sets on H-2A job certifications, petitions, and visas, as well as an estimate of the total number of H-2A workers between 2015 and 2024, with 352,682 H-2A workers estimated to have been employed in the United States last year. The vast majority of H-2A workers are employed on crop farms, picking fruits and vegetables, and the average duration of an H-2A job is roughly six months.

Figure AFigure A

There have been countless exposés from journalists and advocates that reveal how H-2A farmworkers are indentured to their employers, frequently robbed, exploited, victimized, and trafficked, and how the main source of wage and hour violations on farms comes from employers breaking H-2A rules.

The rider adopted in the House would allow H-2A workers to be employed in year-round jobs—which is currently prohibited—expanding the scope of the program and allowing H-2A workers to fill jobs on dairy, livestock, and poultry and egg farms, as well as in nurseries and greenhouses and other nonseasonal agricultural occupations. This would be a major change to H-2A, and it has long been a demand of agribusiness.

Making H-2A year-round raises three key questions:

  • How many permanent, year-round jobs might be impacted?
  • How will farmworker wages be impacted?
  • How much will the H-2A program expand?
There are 410,000 year-round jobs in agriculture

For an answer to the first question, see Table 1, which lists four of the major agricultural industries employing farmworkers year-round, the largest of which are greenhouse and dairy jobs. Together they total nearly 410,000 full-time equivalent jobs. The industries listed do not include the many year-round (or nearly year-round) jobs that can be found on crop farms, including equipment operators and supervisors. In total, it’s possible that up to one-third of the total 1.6 million full-time equivalent jobs in agriculture could be year-round.

Table 1Table 1 DOL’s new Adverse Effect Wage Rate will result in a pay cut for H-2A workers and U.S. workers that will line the pockets of employers by billions

Next, let’s consider what would happen to the wages of farmworkers in year-round occupations if the H-2A visa program were expanded to include them.

The wages of nearly all H-2A farmworkers are set by the Adverse Effect Wage Rate (AEWR), unless the federal, state, or local hourly minimum wages are higher, or if there is an applicable local prevailing wage or collective bargaining agreement in place. The purpose of the AEWR is to ensure that H-2A workers are paid a wage that is consistent with U.S. wage standards and prevent adverse impacts of H-2A employment on the wages of farmworkers in the United States.

On October 2, 2025, DOL issued an interim final rule laying out a new AEWR methodology. A recent EPI post describes in detail how the new Trump AEWR will cut wage rates dramatically by using an inferior data set for agriculture and creating two artificial “skill levels,” which set H-2A wages at the 17th percentile of wages surveyed for farm occupations (skill level 1) and at the 50th percentile, which is the median of wages surveyed (skill level 2).

In the new AEWR, the Trump DOL also removes the previous H-2A program requirement that employers pay for 100% of housing costs for H-2A workers. In its stead, the new AEWR deducts a set amount out of every hour of an H-2A worker’s pay, to compensate the employer for H-2A housing costs. This shifts housing costs to H-2A workers who will have the added burden of paying for housing costs out of the already-low wages they earn. The housing deduction is subtracted from the AEWR—lowering a low wage even further—so low that in many states, the state minimum wage will be higher and become the de facto AEWR.

In total, DOL estimates that over $1.7 billion will be transferred from H-2A workers’ pockets back to farm employers under the new wage rule in 2026, amounting to $24 billion over the next 10 years as the program grows to over 500,000 jobs. EPI’s own estimates are that H-2A workers will see a wage cut of between $1.7 billion and $2.1 billion in 2026, depending on how state minimum wage laws are enforced. Reducing the AEWR for H-2A workers will also lower wages for U.S. farmworkers—one-third of whom are U.S.-born citizens, according to the latest DOL survey. A fall in the H-2A wage will increase demand for H-2A workers, since employers can save significantly on labor costs if they hire them. As a result, it will become relatively more expensive to hire non-H-2A U.S. farmworkers. Employers will therefore reduce demand for U.S. farmworkers, putting downward pressure on their wages, with U.S. farmworkers seeing wage reduction of $2.7 to $3.3 billion in annual pay.

This would represent a shocking upward redistribution of income away from some of the country’s most underpaid and essential workers for the food system.

Under the new AEWR, H-2A farmworkers in year-round jobs would be paid tens of thousands of dollars less annually compared with what U.S. farmworkers earn now

The wage cuts from the AEWR described above currently apply only to H-2A farmworkers, who can only be employed in seasonal jobs. However, if the rider to make H-2A year-round goes into effect, farmworkers in year-round jobs will see the biggest pay cuts.

Table 2 lists a sample of some of the main year-round agricultural industries in major agricultural states, along with average annual employment, which together accounts for about 15% of the total year-round full-time equivalent jobs in agriculture. Table 2 shows how much farmworkers earned annually, on average in 2024 in those industries and states, and compares the annual earnings of farmworkers in 2024 with what H-2A workers would earn in 2026 if they had worked in the same jobs and had been paid the corresponding 2026 AEWR at skill level 1 for the entire year (40 hours per week for 52 weeks), minus the annualized amount that will be deducted from hourly wages for housing according to the 2026 AEWR.1

The final column in Table 2 shows a few examples that illustrate the difference between what year-round U.S. farmworkers in the selected industries earned in 2024 and what H-2A workers at skill level 1 would earn if they were paid the annualized AEWR in 2026. Table 2 shows that the reduction in wages for H-2A farmworkers in year-round jobs could range from an annual pay cut of nearly $21,000 for farmworkers on hog and pig farms in North Carolina to a pay cut of almost $44,000 for farmworkers on poultry and egg farms in Texas.

Outcomes such as these—in which farmworkers paid the 2026 AEWR would earn tens of thousands of dollars less than what U.S. farmworkers earned in major year-round jobs in 2024—are egregious and in violation of the spirit and letter of the AEWR and the H-2A statute, but will be the norm and allowed if the year-round H-2A provision in the rider becomes law. This would hurt some of the most vulnerable and lowest-paid workers in the U.S. labor market and create an almost unstoppable incentive for employers to replace their current farmworkers who now fill year-round jobs with H-2A workers who can’t easily switch employers or effectively complain when their wages are stolen and when they’re forced to work in unsafe conditions.

Table 2Table 2 The year-round H-2A rider with the new AEWR rule could triple the current size of the H-2A program and cause wages to drop sharply for farmworkers

The ultimate result of the new H-2A wage rule combined with making the H-2A program year-round would be a likely tripling of the size of the H-2A program to about 900,000 workers, which includes the complete decimation of job quality for the 410,000 jobs in agriculture that can provide stable year-round employment and sometimes a living wage for U.S. farmworkers.

How would this occur? The Trump DOL’s new wage rule estimates that the lower pay for farmworkers it institutes will encourage farms to rapidly increase hiring through the H-2A program, estimating that 515,000 H-2A workers will be employed in 2034. If those low wages remain in effect and the year-round H-2A rider becomes law and is renewed yearly (as the H-2B riders have been every year), employers are likely to ramp up hiring for year-round jobs until nearly all are filled by H-2A workers who can be paid extremely low wages and, because of their precarious immigration status, have little bargaining power or the ability to complain in the face of employer lawbreaking.

For context, the 410,000 H-2A workers in year-round jobs plus the estimated 257,500 year-round equivalent jobs done by H-2A workers in seasonal jobs (i.e., 515,000 H-2A workers employed in 2034 for six months out of the year), would equal 667,500 full-time equivalent jobs in agriculture, or roughly 42% of all annual average employment in agriculture.

Instead of ballooning the H-2A program, policymakers should create a pathway to citizenship for farmworkers to ensure their rights on the job

Policymakers and the public must reject the harmful and unjustified proposals coming from Trump and Congress to pay less to farmworkers who already live on the margins of society, and to keep more of them indentured through the H-2A program. This rider is another example that reveals the truth about the Trump administration’s immigration agenda: They have no real interest in protecting jobs or pay for American or “native-born” workers, only in giving employers what they demand.

Using H-2A, a problematic temporary work visa program—in which workers are virtually indentured to their employers and that accounts for most of the wage and hour violations that take place on farms—to fill permanent, year-round jobs should give pause to all members of Congress. It makes no sense, unless the goal is to keep the workers employed in those jobs from having equal rights and fair pay. If migrant workers are filling true labor shortages in permanent, year-round jobs, then those workers should always get lawful permanent residence (i.e., green cards) that puts them on a path to citizenship.

If members of Congress want a reliable, healthy, and stable farm labor force that can continue to produce food domestically for Americans, they should pass legislation that legalizes undocumented farmworkers and reforms the H-2A program so that all migrant farmworkers have equal rights, fair wages, and a quick path to permanent residence and citizenship. That’s the only way to ensure that the workers who sustain the food supply chain will be treated with the dignity and respect they deserve and that honors their contributions to the U.S. economy.

1. The amounts have not been adjusted for inflation. The 2026 AEWR provides two “skill levels” for farmworkers—which are set at specific percentiles along the distribution of OEWS wages surveyed. Skill level 1 is the 17th percentile while skill level 2 is the median of wages surveyed, which is also the 50th percentile. For this calculation, I am only calculating the wage differentials for H-2A workers in year-round jobs who are classified by employers at skill level 1, which DOL estimates will account for 92% of all H-2A workers.

 

World's Billionaire Population Surges To New Record High: UBS

Zero Hedge -

World's Billionaire Population Surges To New Record High: UBS

Authored by Andrew Moran via The Epoch Times (emphasis ours),

The ultra-rich grew even wealthier this year and the world has more billionaires than ever, according to Swiss bank UBS.

A megayacht, built by Dutch yacht builder Royal Van Lent for former Starbucks CEO Howard Schultz, is piloted past a bridge in Woubrugge, Netherlands, on May 28, 2025. Josh Walet/ANP/AFP via Getty Images

Global billionaire wealth hit a record $15.8 trillion in 2025, up by 13 percent from 2024, UBS said in its 11th Billionaire Ambitions Report, published on Dec. 4. This is the second-largest annual increase, after 2021, “lifted by existing tech billionaires’ appreciating wealth and the number of new billionaires across a range of sectors,” the report reads.

UBS’s analysis includes cash, securities, corporate ownership interests, property, and other material assets.

“In a highly uncertain time for geopolitics and economics, entrepreneurs are innovating at scale across a range of sectors and markets,” UBS Global Wealth Management executive Benjamin Cavalli said. “They’re creating wealth as they do so.”

Inheritance was also a factor in the growth of the billionaires’ ranks.

In the 12 months through April, 91 people became billionaires through inheritance, receiving almost $298 billion, and the trend is likely to continue as the great wealth transfer intensifies.

The bank calculated that at least $5.9 trillion will be inherited by billionaire children over the next 15 years, “either directly or indirectly through spouses who inherit it first and then pass it on.”

A majority of respondents, 82 percent, said they hope that their children develop the skills and values necessary to succeed on their own without “relying solely on inherited wealth.”

The number of billionaires rose by 8.8 percent in 2025, to 2,919 from 2,682 a year earlier.

The United States has the most billionaires worldwide, with 924 individuals owning approximately $6.9 trillion. This is followed by mainland China, where 470 billionaires own about $1.8 trillion. India (188 billionaires), Germany (156), and the UK (91) rounded out the top five.

UBS said this could change, as billionaires have become more mobile amid geopolitical concerns, tax policy changes, and living standards.

Debating the Wealth Tax

For years, U.S. and European governments have debated the idea of a wealth tax, or an annual levy on net worth, to be imposed once assets minus debts exceed a threshold.

In 2024, Sen. Elizabeth Warren (D-Mass.) and Rep. Pramila Jayapal (D-Wash.) introduced legislation—the Ultra-Millionaire Tax Act—to implement a wealth tax on individuals with more than $50 million.

“All my bill is asking is that when you make it big, bigger than $50 million dollars, then on that next dollar, you pitch in 2 cents, so everyone else can have a chance,” Warren said in March 2024.

The bill stalled in both chambers. Overseas, politicians and voters have been reluctant to back similar schemes.

Billionaire businessman Elon Musk speaks during a town hall meeting at the KI Convention Center in Green Bay, Wis., on March 30, 2025. Scott Olson/Getty Images

Nearly 80 percent of Swiss voters recently turned down a proposed 50 percent tax on inherited fortunes greater than 50 million Swiss francs ($62 million).

The French Parliament rejected a proposed 2 percent tax on wealth greater than 100 million euros ($116 million) in October. Although the UK has not adopted a formal wealth tax, it has announced plans to impose higher taxes on wealthier residents.

Economists have presented divergent opinions on the concept in general. Proponents say it can improve governments’ deteriorating fiscal health and address income inequality. Critics have said that it would disincentivize wealth creation.

In June 2024, a study by French economist Gabriel Zucman estimated that a Group of 20 motion to slap a minimum 2 percent tax on the ultra-wealthy could generate $250 billion in additional revenue.

Nobel Prize-winning economist Joseph Stiglitz, speaking at a 2020 virtual event, argued that the United States needs a wealth tax.

“Where we are today in the 21st century, a basic middle-class life is not accessible to very large portions of America,” Stiglitz said. “I think a wealth tax is a good idea because we have so much inequality in wealth ... [that] even a moderate rate like 3 percent on billionaires and 2 percent on those over $50 million ... [would raise] an enormous amount of revenue.”

Economist Ludwig von Mises wrote in “Human Action” that a wealth tax would be a detriment to capital accumulation and a hindrance to wealth creation, since it would disincentivize the building of wealth.

Capital levies, inheritance and estate taxes, and income taxes are similarly self-defeating if carried to extremes,” Von Mises wrote. “The power to tax is, as Chief Justice [John] Marshall pertinently observed, the power to destroy.”

Years later, economist Milton Friedman also said a wealth levy would punish saving and investment because it would incentivize the affluent “to dissipate wealth.”

“Where do you get the factories?” Friedman said during a university lecture in the 1970s. “Where do you get the machines? Where do you get the capital investment? Where do you get the incentive to improve technology?”

According to Friedman, a wealth tax would be on top of all the other taxes wealthier households already pay.

The Tax Foundation concluded in 2024 that wealth taxes would produce unintended consequences, including job destruction, reduced capital and innovation, slower economic activity, and higher administrative costs. This would result in little revenue being generated, it said.

Tyler Durden Fri, 12/05/2025 - 14:40

Record-Long Gov't Shutdown Forces Southwest To Cut Guidance As Airline Warnings Pile Up

Zero Hedge -

Record-Long Gov't Shutdown Forces Southwest To Cut Guidance As Airline Warnings Pile Up

First, Delta Air Lines warned that the record 43-day government shutdown last month, which throttled air traffic at 40 major airports, would slash its fourth-quarter profit by about $200 million. Now Southwest Airlines is following suit, cutting its full-year profit guidance as the shutdown's ripple effects continue to weigh on major carriers.

Southwest revealed in a new SEC filing:

"As a result of lower revenue due to the government shutdown, and the impact of higher fuel prices, the Company now expects its full-year 2025 EBIT to be approximately $500 million, compared with its prior expectation of $600 million to $800 million. Following the temporary decline in demand related to the shutdown, bookings have returned to previous expectations."

The good news is that the shutdown's impact didn't spill over into December. Southwest noted in its filing that bookings have already bounced back:

Following the temporary decline in demand related to the shutdown, bookings have returned to previous expectations.

Southwest shares are down about 1.5% in premarket trading following the earnings outlook downgrade. Year-to-date (as of Thursday's close), shares are up 6.5%. The float is short 6.56%, or about 33.5 million shares.

Delta Air Lines and Alaska Air Group, which owns Alaska Airlines and Hawaiian Airlines, both disclosed Wednesday that the shutdown's disruption would dent earnings this quarter.

"When you've got the Transportation Secretary telling people, 'We don't have controllers,' questioning the safety at some level of travel, which has never before happened, people said, 'Whoa, I'm going to hold up on making decisions,'" Delta Chief Executive Ed Bastian said Wednesday at a conference.

Last month, the Federal Aviation Administration restricted flights at major US airports in response to the government shutdown, which sent some federal transportation workers home. More importantly, air-traffic controllers called out sick, causing widespread disruptions and prompting Transportation Secretary Sean Duffy to reduce flight volumes nationwide to prevent chaos across airports.

Tyler Durden Fri, 12/05/2025 - 14:20

Noem Says US Travel Ban To Expand To Over 30 Countries

Zero Hedge -

Noem Says US Travel Ban To Expand To Over 30 Countries

Authored by Aldgra Fredly via The Epoch Times,

Homeland Security Secretary Kristi Noem said on Dec. 4 that the Trump administration is looking to increase the number of countries subject to the U.S. travel ban to more than 30.

The United States currently imposes full or partial suspensions of entry on nationals from 19 countries, including Afghanistan, Haiti, Iran, Cuba, Somalia, Libya, Laos, Burma (also known as Myanmar), and Sudan.

Noem said more countries will be added, but did not name any.

“I won’t be specific on the number, but it’s over 30, and the president is continuing to evaluate countries,” she said in an interview on Fox News’ “The Ingraham Angle” that aired Dec. 4.

“Listen, if they don’t have a stable government there, if they don’t have a country that can sustain itself and tell us who those individuals are and help us vet them, why should we allow people from that country to come here to the United States?”

Noem blamed the Biden administration for the asylum backlog, which she said has exceeded a million cases.

She said credible applicants were unable to get through “because the Biden administration was just allowing people to come here and allowing them a free-for-all at the United States and our territories and our country, and then they weren’t vetting them and backlogging their cases.”

The U.S. Citizenship and Immigration Services (USCIS) last week halted all asylum decisions following the Nov. 26 shooting of two National Guard members in Washington, which authorities say was carried out by an Afghan national who entered the United States in September 2021 through a Biden-era resettlement program.

Noem on Dec. 2 called for a “full travel ban” on countries she says are flooding the United States with criminals and welfare dependents following a meeting with President Donald Trump.

“Our forefathers built this nation on blood, sweat, and the unyielding love of freedom—not for foreign invaders to slaughter our heroes, suck dry our hard-earned tax dollars, or snatch the benefits owed to AMERICANS. WE DON'T WANT THEM. NOT ONE,” she stated on X.

Trump has said that his administration would work to pause immigration from “third-world countries” to allow for the U.S. system’s full recovery.

Speaking to reporters on Nov. 30, the president said that his reference to third-world countries included “people from different countries that are not friendly to us,” and “countries that are out of control themselves,” pointing to Somalia as one example.

Trump also urged to suspend all federal benefits and subsidies to noncitizens, denaturalize immigrants who undermine domestic tranquility, and deport any foreigners deemed to be “a public charge, security risk, or non-compatible with Western civilization.”

Tyler Durden Fri, 12/05/2025 - 13:20

Q3 GDP Tracking: Mid 3%

Calculated Risk -

The advance release of Q3 GDP has been cancelled. Q3 GDP will be released on Dec 23rd.

From BofA:
Since our last weekly publication, 3Q GDP tracking increased from 2.8% q/q sarr to 3.0% The upward revision was largely due to the strong September durable goods report that led us to revise higher our equipment estimate. [December 5th estimate]
emphasis added
From Goldman:
We lowered our Q3 GDP tracking estimate by 0.3pp to +3.5% (quarter-over-quarter annualized) and our Q3 domestic final sales estimate by 0.2pp to +2.6%. [December 5th estimate]
GDPNowAnd from the Atlanta Fed: GDPNow
The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2025 is 3.5 percent on December 5, down from 3.8 percent on December 4. After this morning’s personal income and outlays release from the US Bureau of Economic Analysis, the nowcast for third-quarter real personal consumption expenditures growth declined from 3.1 percent to 2.7 percent. [December 5th estimate]

Without today’s jobs report, next-best data indicate a weakening labor market

EPI -

In normal times, today would have been a jobs day. However, the Bureau of Labor Statistics (BLS) has been forced to delay the release until December 16 due to the lingering impacts of the Trump administration radically restricting BLS operations during the government shutdown. Further, BLS has announced that we will never have data from the monthly survey of households for October. This means that valuable information for that month—like the overall unemployment rate or the unemployment rate for various demographic groups—will never be known. During the last federal shutdown in 2018–2019, BLS did not suspend its activities and released its employment situation report as normal. In fact, this is the first time in 12 years that a jobs report was delayed and the first time a month of household data will be missed completely.

Federal statistical agencies (FSAs) like BLS and the Census Bureau provide the gold standard data that are crucial for understanding the labor market. The monthly jobs report provides policymakers, businesses, and the public with the most rigorous and timely labor market data they need to make high-stakes decisions. Unfortunately, without a timely release, the Federal Reserve will meet next week without the best data on the state of the labor market. This will materially harm their ability to make a data-informed decision on interest rate policy.

This is not the first time the Trump administration has sought to weaken FSAs. In August, Trump fired the BLS commissioner for accurately reporting data that the administration found politically inconvenient. Amid these historically unprecedented threats, we assembled a new Data Accountability Dashboard that tracks next-best data from other (non-federal) data sources—including ADP employment data, job cut announcements from the Challenger report, and consumer sentiment reports.

These are clearly inferior to the datasets that have historically been collected and analyzed by the nonpartisan, expert professionals who work at FSAs, but they still provide some insights into the direction the economy is moving. This data would also—over time—provide some potential signal if official FSA data were being manipulated or suppressed to hide an economic downturn. Updates to those next-best data this week suggest some weakening in the labor market. Whether this is supported by the FSA data coming back online in coming weeks is a key question people should be watching.

On Wednesday, ADP’s monthly National Employment Report showed a loss of 32,000 jobs in the private sector in November. Our dashboard uses a three-month moving average to remove some volatility and, in making this adjustment, tracks BLS private-sector employment a bit more closely. As shown in Figure A below, ADP employment has dipped below zero for the first time since the pandemic. BLS data available only through September show a similar slowdown. It is possible that Trump administration attacks on immigrant communities have sharply reduced labor supply and driven some of the radical slowdown in job growth. However, even with reduced immigration, the U.S. economy still needs non-zero job growth to keep the labor market from deteriorating. I’ll be looking closely at the official data for October and November released on December 16 to see if they reflect the trends shown here.

Figure AFigure A

On December 9, the BLS will release data for September and October from the Job Openings and Labor Turnover Survey (JOLTS). Currently, the latest JOLTS data are only available through August. Data from Indeed on job postings (Figure B) and data from Challenger on job cuts (Figure C) provide some insights into job openings and layoffs, given the current lack of gold standard data. Indeed data are provided on a daily basis but are aggregated into a monthly average, which we use here to compare with JOLTS job openings data. So far, the latest data suggest little change in job openings.

Job cut announcements, while volatile, appear to be slowly rising. The official layoffs rate released as part of the JOLTS data has not yet reflected this rise. But it is concerning given that the hires rate remains depressed, a rate similar to the immediate aftermath of the Great Recession. That makes the downside risk of higher layoffs all the greater if laid-off workers have less opportunity to find another job. Put simply, the only reason the unemployment rate has been able to stay relatively low in the last year even as hiring has been depressed is because layoffs have been extraordinarily low. If layoffs pick up while hiring remains weak, unemployment will quickly spike. This makes layoffs a key indicator to watch when the JOLTS data are released next week.

Figure BFigure B Figure CFigure C   Once the official FSA data are released and hopefully return to a normal schedule, our Data Accountability Dashboard will still be useful to make sure those gold standard data are not being compromised either because of staffing shortages or for political gain. The first and best line of defense against data manipulation escaping public notice will be whistleblowers from FSAs who are dedicated professionals and will not want it degraded. But if data are being manipulated and whistleblowers emerge, the dashboard can provide useful data accountability checks. For more next-best data, check out the entire dashboard for all nine metrics we are tracking as new data become available.

AT&T Scraps DEI Amid Broader Corporate Shift Toward Merit-Based Policies

Zero Hedge -

AT&T Scraps DEI Amid Broader Corporate Shift Toward Merit-Based Policies

Authored by Tom Ozimek via The Epoch Times (emphasis ours),

AT&T told federal regulators this week that it has eliminated all diversity, equity, and inclusion (DEI) policies and programs across its business, becoming the latest major corporation to unwind such initiatives amid a broader shift toward merit-based employment practices and heightened scrutiny from the Trump administration.

The AT&T logo on a building in Los Angeles on Aug. 10, 2017. Mike Blake/Reuters

In a Dec. 1 letter filed with the Federal Communications Commission (FCC) as part of AT&T’s bid to acquire U.S. Cellular spectrum licenses for roughly $1 billion, the company said it is “ending DEI-related policies ... not just in name but in substance,” following recent executive orders, Supreme Court rulings, and guidance from the Equal Employment Opportunity Commission.

AT&T said it has adjusted its employment and business practices “to ensure that they comply with all applicable laws and related requirements,” AT&T wrote to FCC Chairman Brendan Carr, adding that its hiring, training, and promotion practices “are not and will not be based on or limited by race, gender, or other protected characteristics.”

The company said it removed all training related to DEI, scrubbed internal and external messaging referencing the concept, discontinued sponsorships it deemed unrelated to its business strategy, and stopped conducting employee surveys focused on protected characteristics. AT&T also said it no longer uses DEI considerations in selecting suppliers and “will not have any roles focused on DEI.”

“AT&T has always stood for merit-based opportunity, and we are pleased to reaffirm our commitment to equal employment opportunity and nondiscrimination today,” the company wrote. “Consistent with applicable law, our multi-pronged approach allows employees to thrive in an environment free from invidious discrimination.”

Carr, a Republican tapped by President Donald Trump in January to lead the FCC, praised the disclosure.

“AT&T has now memorialized its commitment to ending DEI-related policies in an FCC filing,” he wrote on X.

He added that the companywide rollback followed changes announced earlier this year after pressure from conservative activist Robby Starbuck, who urged AT&T to dismantle programs he argued were discriminatory.

FCC Commissioner Anna Gomez, a Democrat, criticized the move, saying in a social media post that AT&T’s reversal “isn’t a sudden transformation of values, but a strategic financial play to curry favor with this FCC/Administration.”

Gomez said that abandoning “fairness and inclusion for short-term gain will be a stain to their reputation long into the future.”

Part of a Broader Corporate Retreat

AT&T’s shift comes as major corporations reassess or eliminate DEI initiatives in response to new legal risks and regulatory scrutiny. Wireless carrier T-Mobile said in July it was ending its DEI programs while seeking approval for two major transactions, including a $4.4 billion deal to acquire most of U.S. Cellular’s wireless operations. Verizon agreed to end its DEI program in the context of its $20 billion acquisition bid for Frontier Communications earlier this year.

The trend also extends beyond the telecommunications sector. Ford, McDonald’s, John Deere, Walmart, Nissan, Toyota, Molson Coors, Citibank, and Meta are among the large employers that have recently rebranded, scaled back, or ended DEI programs, citing changing legal standards after the Supreme Court’s 2023 affirmative action ruling and sweeping executive actions by Trump directing federal agencies—and encouraging the private sector—to abandon race- and sex-based preferences.

Disney Softens DEI Language Amid FCC Probe

The rollback wave has reached Hollywood as well. The Walt Disney Co. removed virtually all DEI-related terminology from its 2025 annual report to the Securities and Exchange Commission—the first such omission in at least five years—even as the company faces an FCC investigation into whether its ABC and related networks violated federal equal employment opportunity rules.

Carr ordered the probe in March, citing Disney initiatives that sought to “amplify underrepresented voices” and inclusion standards requiring a high percentage of characters, writers, directors, and crew to come from “underrepresented” groups. He said the agency must ensure that such practices do not embed “identity quotas” in violation of the Communications Act.

Disney said it was reviewing the FCC’s letter and plans to cooperate.

Tyler Durden Fri, 12/05/2025 - 12:00

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