Trump 'Very Angry' At Ukraine Repeatedly Attacking Russian Pipeline To Hungary, Slovakia

For the second time in less than two weeks, Russian oil shipments to Hungary have been suspended following yet another Ukrainian strike on the Druzhba pipeline.

Hungary's Foreign Minister Peter Szijjarto announced it Friday, with Slovak officials also confirming. "This is yet another blow to our energy security - another effort to pull us into the war," Szijjarto stated on social media. It occurred near the Russia-Belarus border.

Source: EPA

Prior strikes on the Druzhba pipeline network took place on August 13 and August 18, with the last attack having crippled a vital transformer station, which had previously but briefly halted oil flows.

It is certainly nothing new that Ukraine's intelligence and military is targeting Russian energy infrastructure; however, what is new is President Trump's surprise reaction:

U.S. President Donald Trump said he got “very angry” after Ukraine damaged a Russian oil pipeline that supplies his friend Viktor Orbán, Hungary's prime minister.

Trump responded to a note from Orbán, who complained about a Ukrainian drone attack overnight on Aug. 13 hitting the Druzhba oil pipeline, which supplies Hungary, Slovakia and other countries in Central Europe with Russian oil through Ukrainian territory.

“Viktor — I do not like hearing this. I am very angry about it. Tell Slovakia,” Trump wrote according to a letter published online by Orbán's ruling Fidesz party. “You are my great friend,” the U.S. president added.

Below is the letter as released by Hungarian state media and the prime minister's office:

The incident that Trump was responding to was an earlier August attack, which occurred "just before the historic meeting between President Trump and [Russian President Vladimir] Putin in Alaska" - as Orban wrote.

"Hungary supports Ukraine with electricity and petrol, in return they bomb pipeline that supply us. Very unfriendly move," Orban stated.

Trump might also condemn this newest Friday attack if he's asked about it by reporters - but there remains something deeply contradictory about the White House stance. Trump just this week in a Truth Social post seemed to say that Ukraine must go on the offensive against Russia if it hopes to achieve a peace deal which benefits Kiev. As the WSJ noted: 

By Thursday, he was saying that Kyiv had no chance of winning the war without new attacks on Russia.

“It’s like a great team in sports that has a fantastic defense, but is not allowed to play offense,” Trump posted on social media. “Interesting times ahead!!!”

His turnaround underscored the fading optimism about Trump’s latest push to end the war.

Trump seems to be signaling that he wants to see Ukraine go on the offensive, but refrain from hitting energy sites. This is at least consistent with Trump's wanting a 'freeze' on attacks targeting energy infrastructure, which had been enacted for a brief period months ago.

Hungary continues to rely heavily on Russian oil, even after most European nations have imposed sanctions and sought alternative sources.

Polish-Hungarian relations in three tweets. pic.twitter.com/ji8czGaGw9

— Yaroslav Trofimov (@yarotrof) August 22, 2025

Budapest's Russian energy supply is primarily delivered through the Druzhba pipeline, which passes through Belarus and Ukraine before reaching Hungary and Slovakia.

Tyler Durden Fri, 08/22/2025 - 13:00

FTC Sues Gym Chain For Making It 'Exceedingly Difficult' To Cancel Memberships

Authored by Naveen Athrappully via The Epoch Times (emphasis ours),

The Federal Trade Commission (FTC) filed a lawsuit against the operators of LA Fitness and other gyms over allegations that they make it “exceedingly difficult” for subscribers to cancel recurring gym memberships and related services, according to a statement issued by the agency on Aug. 20.

An LA Fitness location, in this file photo. Kevin C. Cox/Getty Images

The FTC lawsuit was filed on Aug. 20 against Fitness International LLC and Fitness & Sports Clubs LLC, which together own and operate LA Fitness and other gym chains, including Esporta Fitness, City Sports Club, and Club Studio, which have more than 600 locations and more than 3.7 million members nationwide.

The lawsuit was filed in the U.S. District Court for the Central District of California for violating the Restore Online Shoppers’ Confidence Act (ROSCA) and seeks monetary relief for consumers harmed by the alleged practices.

The lawsuit alleges that the defendants use “difficult” cancellation procedures that are found to be time-consuming and inadequately disclosed to consumers when they join up. Members who wish to cancel must generate a cancellation form online and print it. Then, they need to submit the printed forms to the gym during limited hours.

The forms must be submitted to the “specific manager at the location who is authorized to process the forms,” and not just any gym employee, the complaint states. Another way to cancel is by certified or registered mail, which necessitates a visit to the post office.

The cancellation processes are “opaque, complicated, and demanding,” the FTC stated, adding that many consumers who have gone through the procedures “nevertheless find that they continue to be billed for their memberships.”

According to the agency, the gym operators have retained the system despite receiving tens of thousands of reports from consumers complaining about the cancellation procedures.

The companies offer gym memberships in the range of $30 to $299 per month, depending on additional services such as towel service or child care. The costs incurred by the consumer, while joining, include the first and last month’s dues, monthly recurring dues, and annual fees, the FTC stated.

“The FTC’s complaint describes a scenario that too many Americans have experienced—a gym membership that seems impossible to cancel,” said Christopher Mufarrige, director of the FTC’s Bureau of Consumer Protection.

The commission voted 3–0 to authorize the filing of the complaint.

According to ROSCA, an online seller must disclose all material terms before attempting to charge any consumer’s credit card, debit card, or bank account, and provide simple mechanisms to stop recurring charges. The FTC is the enforcer of this Act.

Gym Response

Fitness International President Jill Hill expressed disappointment with the FTC complaint in a company statement published on Aug. 20.

“The allegations are without merit, and the statute the FTC relies upon—the Restore Online Shoppers’ Confidence Act (ROSCA), enacted almost 15 years ago—was designed to address only online retail transactions, does not require any specific method of cancellation, and has never before been applied to the health club industry. We remain confident that we will prevail in court,” Hill said.

She said most of the gym memberships were done at physical locations and not online. The companies have “launched an online cancellation option for all members, regardless of how they originally signed up,” Hill said.

“With just a few clicks, members may cancel online—a step we voluntarily implemented well ahead of regulatory deadlines,” she said.

The companies work to comply with all health club state laws regarding membership cancellations, according to Hill.

The FTC had announced a “Click-to-Cancel” rule in 2024 under the Biden administration. The rule, which went into effect earlier this year, was postponed by the Trump administration to give businesses additional time to comply.

The rule mandates that canceling a subscription must be as simple as signing up.

Tyler Durden Fri, 08/22/2025 - 12:40

From Goldman:

We boosted our Q3 GDP tracking estimate by 0.1pp to +1.5% (quarter-over-quarter annualized). Our Q3 domestic final sales estimate stands at +0.3%. We left our past-quarter GDP tracking estimate unchanged at +3.1%. [August 21st estimate]

And from the Atlanta Fed: GDPNow

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2025 is 2.3 percent on August 19, down from 2.5 percent on August 15. After this morning’s housing starts release from the US Census Bureau, the nowcast of third-quarter real residential investment growth decreased from 1.1 percent to -5.9 percent. [August 19th estimate]

Bill Ackman Is Promoting An Anti-Woke AI-Powered School Coming To New York

Hedge fund manager Bill Ackman is throwing his support behind Alpha School, a private education network that blends artificial intelligence with an unconventional approach to learning, according to the Wall Street Journal.

The school, which already operates in Texas, Florida, and California, plans to open a kindergarten-through-eighth-grade campus in Manhattan this fall.

Alpha’s model is unusual: students complete math, reading, and other fundamentals in just two hours a day using AI-driven software. The rest of the schedule is filled with activities meant to build confidence and practical skills, such as bike rides or drone workshops.

“We do not let anything—political, social issues—come in the way,” said co-founder MacKenzie Price. “We stay very much out of that.”

Price, who has become a prominent critic of traditional education on social media, launched Alpha more than a decade ago. The school employs “guides” rather than certified teachers and charges families between $40,000 and $65,000 annually, depending on location.

Ackman, best known for running the $20 billion firm Pershing Square, has recently taken on the role of informal booster for Alpha. He first heard about the school earlier this year and was impressed by its reliance on technology and its decision to avoid hot-button debates around diversity, equity, and inclusion. He has since hosted parents at Alpha’s Austin campus and is scheduled to appear on a panel about education at his Hamptons home, alongside Price, Alpha principal Joe Liemandt, and financier Michael Milken.

The Journal writes that though not an investor, Ackman’s enthusiasm has elevated the school’s profile. A person close to Alpha described him as a “de facto ambassador.” On social media, he praised its approach in what some observers saw as a glowing endorsement.

Ackman’s embrace of Alpha fits into his broader criticism of higher education, especially his attacks on Harvard University’s handling of campus antisemitism and its embrace of DEI initiatives. His online campaign against Harvard leadership last year helped push the school’s president to resign.

Alpha plans to expand quickly, with new schools opening in Arizona, North Carolina, Virginia, California, and Puerto Rico. Price has said she may eventually raise outside investment to fund growth, but for now Ackman’s backing is giving the school an influential foothold in New York’s crowded private-education market.

Tyler Durden Fri, 08/22/2025 - 12:05

Bill Ackman Is Promoting An Anti-Woke AI-Powered School Coming To New York

Hedge fund manager Bill Ackman is throwing his support behind Alpha School, a private education network that blends artificial intelligence with an unconventional approach to learning, according to the Wall Street Journal.

The school, which already operates in Texas, Florida, and California, plans to open a kindergarten-through-eighth-grade campus in Manhattan this fall.

Alpha’s model is unusual: students complete math, reading, and other fundamentals in just two hours a day using AI-driven software. The rest of the schedule is filled with activities meant to build confidence and practical skills, such as bike rides or drone workshops.

“We do not let anything—political, social issues—come in the way,” said co-founder MacKenzie Price. “We stay very much out of that.”

Price, who has become a prominent critic of traditional education on social media, launched Alpha more than a decade ago. The school employs “guides” rather than certified teachers and charges families between $40,000 and $65,000 annually, depending on location.

Ackman, best known for running the $20 billion firm Pershing Square, has recently taken on the role of informal booster for Alpha. He first heard about the school earlier this year and was impressed by its reliance on technology and its decision to avoid hot-button debates around diversity, equity, and inclusion. He has since hosted parents at Alpha’s Austin campus and is scheduled to appear on a panel about education at his Hamptons home, alongside Price, Alpha principal Joe Liemandt, and financier Michael Milken.

The Journal writes that though not an investor, Ackman’s enthusiasm has elevated the school’s profile. A person close to Alpha described him as a “de facto ambassador.” On social media, he praised its approach in what some observers saw as a glowing endorsement.

Ackman’s embrace of Alpha fits into his broader criticism of higher education, especially his attacks on Harvard University’s handling of campus antisemitism and its embrace of DEI initiatives. His online campaign against Harvard leadership last year helped push the school’s president to resign.

Alpha plans to expand quickly, with new schools opening in Arizona, North Carolina, Virginia, California, and Puerto Rico. Price has said she may eventually raise outside investment to fund growth, but for now Ackman’s backing is giving the school an influential foothold in New York’s crowded private-education market.

Tyler Durden Fri, 08/22/2025 - 12:05

US National Security Probe Targets Wind Industry

By Julianne Geiger of OilPrice.com

The Commerce Department just opened a Section 232 “national security” probe into imported wind turbines and parts—quietly on Aug. 13, publicly today. That matters because 232 isn’t a press release; it’s a legal on-ramp to more tariffs on top of the new 50% duty already applied to the steel and aluminum content in turbines and components.

Here’s the operational read: the U.S. wind build is heavily import-dependent for blades, drivetrains, and electrical systems. In 2023, the U.S. brought in about $1.7B of wind equipment, with roughly 41% from Mexico, Canada, and China. If you tax the metal inside the machine—and potentially layer more 232 duties later—you squeeze project profit margins, renegotiate Power Purchase Agreements (PPAs—long-term contracts to sell the power), or delay FIDs. None of those outcomes lowers your Levelized Cost of Energy (LCOE—think of it as the average lifetime price per unit of electricity once you add up all the costs).

Wood Mackenzie pegs the tariff bite at +7% for turbine costs (+5% total project costs) under the earlier tariff proposals; in a universal 25% tariff scenario, turbine costs could rise ~10% and LCOE up ~7%. And that was before Commerce slapped a 50% surcharge on the steel/aluminum content—so the floor just moved higher. Expect original equipment manufacturers to reroute supply chains, localize sub-assemblies, and raise prices anyway. Vestas has already said the quiet part out loud: these costs flow straight through to electricity prices.

Don’t confuse this with an offshore-only story. Onshore wind is where the bulk of U.S. volume lives, and it’s far more sensitive to every $/kW swing, gearbox delivery delay, and tower steel price jump. Section 232 is also being deployed against other “critical” imports (planes, chips, pharma), so wind isn’t a one-off carve-out—it’s part of a broader, durable trade posture that project finance now has to underwrite.

Winners and losers? Near-term winners include U.S. tower fabricators and any blade/drivetrain maker who can credibly and quickly localize. Losers are developers stuck with fixed-price PPAs and engineering firms with thin contingencies. Grid bottlenecks and permitting are still the bigger choke points, but tariffs aren’t a rounding error anymore—they’re line-item pain.

The probe suggests that “buy more domestic, pay more near-term” is policy, not rhetoric. Expect delayed Commercial Operation Dates (CODs—the day projects actually flip the switch and start earning revenue), tougher PPA negotiations, and a faster push to U.S. content. Wind still looks okay economically on paper, just with a higher metal cost and a thinner margin for error.

Tyler Durden Fri, 08/22/2025 - 11:45

US National Security Probe Targets Wind Industry

By Julianne Geiger of OilPrice.com

The Commerce Department just opened a Section 232 “national security” probe into imported wind turbines and parts—quietly on Aug. 13, publicly today. That matters because 232 isn’t a press release; it’s a legal on-ramp to more tariffs on top of the new 50% duty already applied to the steel and aluminum content in turbines and components.

Here’s the operational read: the U.S. wind build is heavily import-dependent for blades, drivetrains, and electrical systems. In 2023, the U.S. brought in about $1.7B of wind equipment, with roughly 41% from Mexico, Canada, and China. If you tax the metal inside the machine—and potentially layer more 232 duties later—you squeeze project profit margins, renegotiate Power Purchase Agreements (PPAs—long-term contracts to sell the power), or delay FIDs. None of those outcomes lowers your Levelized Cost of Energy (LCOE—think of it as the average lifetime price per unit of electricity once you add up all the costs).

Wood Mackenzie pegs the tariff bite at +7% for turbine costs (+5% total project costs) under the earlier tariff proposals; in a universal 25% tariff scenario, turbine costs could rise ~10% and LCOE up ~7%. And that was before Commerce slapped a 50% surcharge on the steel/aluminum content—so the floor just moved higher. Expect original equipment manufacturers to reroute supply chains, localize sub-assemblies, and raise prices anyway. Vestas has already said the quiet part out loud: these costs flow straight through to electricity prices.

Don’t confuse this with an offshore-only story. Onshore wind is where the bulk of U.S. volume lives, and it’s far more sensitive to every $/kW swing, gearbox delivery delay, and tower steel price jump. Section 232 is also being deployed against other “critical” imports (planes, chips, pharma), so wind isn’t a one-off carve-out—it’s part of a broader, durable trade posture that project finance now has to underwrite.

Winners and losers? Near-term winners include U.S. tower fabricators and any blade/drivetrain maker who can credibly and quickly localize. Losers are developers stuck with fixed-price PPAs and engineering firms with thin contingencies. Grid bottlenecks and permitting are still the bigger choke points, but tariffs aren’t a rounding error anymore—they’re line-item pain.

The probe suggests that “buy more domestic, pay more near-term” is policy, not rhetoric. Expect delayed Commercial Operation Dates (CODs—the day projects actually flip the switch and start earning revenue), tougher PPA negotiations, and a faster push to U.S. content. Wind still looks okay economically on paper, just with a higher metal cost and a thinner margin for error.

Tyler Durden Fri, 08/22/2025 - 11:45

The post MAGA 2.0: Making China Great Again appeared first on CEPR.

Trump Laments Stalled Ukraine Peace Talks While Simultaneously Urging New Attacks On Russia

Now, merely a week out from when Presidents Trump and Putin met in Alaska, the White House's admirable peace efforts seem to be unraveling and even hopelessly stalled. Many independent-minded analysts had from the very start said that this conflict will ultimately be settled on the battlefield. The Wall Street Journal too seems to be coming around to this view:

On Monday, President Trump boasted about quickly brokering peace to end the bloody Ukraine conflict. By Thursday, he was saying that Kyiv had no chance of winning the war without new attacks on Russia.

“It’s like a great team in sports that has a fantastic defense, but is not allowed to play offense,” Trump posted on social media. “Interesting times ahead!!!”

His turnaround underscored the fading optimism about Trump’s latest push to end the war.

Indeed this is another example of the West trying to have its cake and eat it too, as Trump strongly hints that Ukraine must take the offensive while simultaneously lamenting that Putin and Zelensky are not getting together in a hoped-for summit.

Trump is essentially saying Ukraine cannot win the war unless it launches attacks on Russia.

Associated Press/CBC

"It is very hard, if not impossible, to win a war without attacking an invaders country," Trump had explained further in his Truth Social statement.

The WSJ in its analysis then turns to one of the big factors which is sure to stymie talks from Moscow's point of view: security guarantees for Ukraine:

U.S. and European officials are still negotiating the makeup of a peacekeeping force that would aim to deter future Russian attacks against Ukraine if a peace deal was reached. Even that idea was quickly rebuffed by the Kremlin and raised questions about Trump’s willingness to commit to a major role for the U.S. military.

With much of his plans still unrealized, Trump is confronted with the uncertainties that have dogged him for the past seven months: How willing is he to pressure Putin, and how far is he willing to go in backing Zelensky?

As we highlighted before, the 'logic' of this is contradictory and will lead nowhere. Why would Russia agree to end its military operations if in the end NATO-like 'security guarantees' are to be given to Ukraine as a reward?...to quote Moon of Alabama.

Meanwhile, Russian Foreign Minister Sergey Lavrov reminded the US and its Western allies on Thursday that President Putin has "repeatedly said that he is ready to meet, including with Zelensky, if there is understanding that all issues that require consideration at the highest level have been worked out thoroughly" by experts and ministers.

To translate, Putin will only sit down with Zelensky if they are already at the goal line of having worked out a permanent peace deal. This has been reiterated in a Friday foreign ministry statement:

LAVROV: PUTIN-ZELENSKY MEETING NOT PLANNED YET — KREMLIN SAYS SUMMIT POSSIBLE ONLY AFTER AGENDA IS AGREED

THREAD: Europe struggles to understand Trump because Trump is a political wrestler. And wrestling is foreign to Europe. Let me explain. 1/12 pic.twitter.com/qeKYOCRP5r

— Volodymyr Demchenko (@brokenpixelua) August 21, 2025

And as RT outlines further, "Moscow maintains that any lasting settlement must eliminate the root causes of the conflict, address Russia’s security concerns, and recognize current territorial realities, including the status of Crimea and the four former Ukrainian regions that voted to join Russia in 2022." This means there must be the permanent neutrality of Ukraine, the formal ceding of territories, and that the Russian neighbor cease being militarized by NATO.

Reuters also describes, "Vladimir Putin is demanding that Ukraine give up all of the eastern Donbas region, renounce ambitions to join NATO, remain neutral and keep Western troops out of the country, three sources familiar with top-level Kremlin thinking told Reuters."

And per Bloomberg: "A full ceasefire or peace agreement in Ukraine remains unlikely this year, with even the prospect of a partial truce fading, according to JPMorgan emerging market and policy strategists."

Tyler Durden Fri, 08/22/2025 - 11:25

Trump Laments Stalled Ukraine Peace Talks While Simultaneously Urging New Attacks On Russia

Now, merely a week out from when Presidents Trump and Putin met in Alaska, the White House's admirable peace efforts seem to be unraveling and even hopelessly stalled. Many independent-minded analysts had from the very start said that this conflict will ultimately be settled on the battlefield. The Wall Street Journal too seems to be coming around to this view:

On Monday, President Trump boasted about quickly brokering peace to end the bloody Ukraine conflict. By Thursday, he was saying that Kyiv had no chance of winning the war without new attacks on Russia.

“It’s like a great team in sports that has a fantastic defense, but is not allowed to play offense,” Trump posted on social media. “Interesting times ahead!!!”

His turnaround underscored the fading optimism about Trump’s latest push to end the war.

Indeed this is another example of the West trying to have its cake and eat it too, as Trump strongly hints that Ukraine must take the offensive while simultaneously lamenting that Putin and Zelensky are not getting together in a hoped-for summit.

Trump is essentially saying Ukraine cannot win the war unless it launches attacks on Russia.

Associated Press/CBC

"It is very hard, if not impossible, to win a war without attacking an invaders country," Trump had explained further in his Truth Social statement.

The WSJ in its analysis then turns to one of the big factors which is sure to stymie talks from Moscow's point of view: security guarantees for Ukraine:

U.S. and European officials are still negotiating the makeup of a peacekeeping force that would aim to deter future Russian attacks against Ukraine if a peace deal was reached. Even that idea was quickly rebuffed by the Kremlin and raised questions about Trump’s willingness to commit to a major role for the U.S. military.

With much of his plans still unrealized, Trump is confronted with the uncertainties that have dogged him for the past seven months: How willing is he to pressure Putin, and how far is he willing to go in backing Zelensky?

As we highlighted before, the 'logic' of this is contradictory and will lead nowhere. Why would Russia agree to end its military operations if in the end NATO-like 'security guarantees' are to be given to Ukraine as a reward?...to quote Moon of Alabama.

Meanwhile, Russian Foreign Minister Sergey Lavrov reminded the US and its Western allies on Thursday that President Putin has "repeatedly said that he is ready to meet, including with Zelensky, if there is understanding that all issues that require consideration at the highest level have been worked out thoroughly" by experts and ministers.

To translate, Putin will only sit down with Zelensky if they are already at the goal line of having worked out a permanent peace deal. This has been reiterated in a Friday foreign ministry statement:

LAVROV: PUTIN-ZELENSKY MEETING NOT PLANNED YET — KREMLIN SAYS SUMMIT POSSIBLE ONLY AFTER AGENDA IS AGREED

THREAD: Europe struggles to understand Trump because Trump is a political wrestler. And wrestling is foreign to Europe. Let me explain. 1/12 pic.twitter.com/qeKYOCRP5r

— Volodymyr Demchenko (@brokenpixelua) August 21, 2025

And as RT outlines further, "Moscow maintains that any lasting settlement must eliminate the root causes of the conflict, address Russia’s security concerns, and recognize current territorial realities, including the status of Crimea and the four former Ukrainian regions that voted to join Russia in 2022." This means there must be the permanent neutrality of Ukraine, the formal ceding of territories, and that the Russian neighbor cease being militarized by NATO.

Reuters also describes, "Vladimir Putin is demanding that Ukraine give up all of the eastern Donbas region, renounce ambitions to join NATO, remain neutral and keep Western troops out of the country, three sources familiar with top-level Kremlin thinking told Reuters."

And per Bloomberg: "A full ceasefire or peace agreement in Ukraine remains unlikely this year, with even the prospect of a partial truce fading, according to JPMorgan emerging market and policy strategists."

Tyler Durden Fri, 08/22/2025 - 11:25

Supreme Court Allows Trump Admin To Revoke DEI-Related NIH Grants

By Matthew Vadum of Epoch Times,

The Supreme Court voted 5–4 on Aug. 21 to allow the National Institutes of Health (NIH) to cancel hundreds of millions of dollars in research grants linked to diversity, equity, and inclusion (DEI) initiatives.

The new ruling clears the way for the funding reductions while litigation over the grants continues in the lower courts.

The justices filed five separate opinions explaining their votes.

Justices Clarence Thomas, Samuel Alito, Neil Gorsuch, Brett Kavanaugh, and Amy Coney Barrett voted to allow the grants to be cut.

Justices Sonia Sotomayor, Elena Kagan, Ketanji Brown Jackson, and Chief Justice John Roberts voted to deny the government’s request to rescind the funding.

The high court said it acted because the federal government faces the possibility that the grant monies, once paid out, may not be recovered.

Moreover, “the plaintiffs do not state that they will repay grant money if the Government ultimately prevails.”

The case is known as National Institutes of Health v. American Public Health Association.

The Department of Justice filed an emergency application with the nation’s highest court late last month, asking the justices to block a ruling by Boston-based U.S. District Judge William Young, who found the cancellation was unlawful and ordered the government to restore the funding.

NIH began taking steps in February to end the grants that conflict with President Donald Trump’s policy priorities.

The NIH is the world’s largest government funder of biomedical research.

The emergency application stemmed from two lawsuits challenging the cuts to grants involving DEI, “transgender issues,” “vaccine hesitancy,” and other issues.

The American Public Health Association described the cuts as an “ongoing ideological purge” of projects with a purported connection to gender identity, DEI, or “other vague, now-forbidden language.” A coalition of 16 attorneys general, largely Democrats, alleged their public research institutions are facing harm because of the funding delays and cuts.

The district court directed the NIH “to continue paying $783 million in federal grants that are undisputedly counter to the Administration’s priorities,” the department said in its filing.

“Following the change in Administration, the NIH identified, explained, and pursued new funding priorities. That is democracy at work, not, as the district court thought, proof of inappropriate ‘partisan[ship]’—let alone a permissible basis for setting agency action aside.”

In his written opinion, Gorsuch said the district court’s ruling upholding the grants conflicted with the Supreme Court’s decision in Department of Education v. California in April that let the Trump administration withdraw education-related grants.

“Lower court judges may sometimes disagree with this Court’s decisions, but they are never free to defy them,” Gorsuch said.

Unless we want anarchy to take over the federal judicial system, “a precedent of this Court must be followed by the lower federal courts no matter how misguided the judges of those courts may think it to be,” Gorsuch said, quoting a prior Supreme Court ruling.

In his dissenting opinion, Roberts said the district court ruling was justified.

“This relief—which has prospective and generally applicable implications beyond the reinstatement of specific grants—falls well within the scope of the District Court’s jurisdiction under the [federal] Administrative Procedure Act.”

Sotomayor, Kagan, and Jackson joined the dissent in part.

In her dissenting opinion, Jackson said the high court’s new ruling is “Calvinball jurisprudence with a twist,” a reference to a fictional game featured in the comic strip, “Calvin and Hobbes.”

“Calvinball has only one rule: There are no fixed rules. We seem to have two: that one, and this Administration always wins,” she said.

Tyler Durden Fri, 08/22/2025 - 11:05

Supreme Court Allows Trump Admin To Revoke DEI-Related NIH Grants

By Matthew Vadum of Epoch Times,

The Supreme Court voted 5–4 on Aug. 21 to allow the National Institutes of Health (NIH) to cancel hundreds of millions of dollars in research grants linked to diversity, equity, and inclusion (DEI) initiatives.

The new ruling clears the way for the funding reductions while litigation over the grants continues in the lower courts.

The justices filed five separate opinions explaining their votes.

Justices Clarence Thomas, Samuel Alito, Neil Gorsuch, Brett Kavanaugh, and Amy Coney Barrett voted to allow the grants to be cut.

Justices Sonia Sotomayor, Elena Kagan, Ketanji Brown Jackson, and Chief Justice John Roberts voted to deny the government’s request to rescind the funding.

The high court said it acted because the federal government faces the possibility that the grant monies, once paid out, may not be recovered.

Moreover, “the plaintiffs do not state that they will repay grant money if the Government ultimately prevails.”

The case is known as National Institutes of Health v. American Public Health Association.

The Department of Justice filed an emergency application with the nation’s highest court late last month, asking the justices to block a ruling by Boston-based U.S. District Judge William Young, who found the cancellation was unlawful and ordered the government to restore the funding.

NIH began taking steps in February to end the grants that conflict with President Donald Trump’s policy priorities.

The NIH is the world’s largest government funder of biomedical research.

The emergency application stemmed from two lawsuits challenging the cuts to grants involving DEI, “transgender issues,” “vaccine hesitancy,” and other issues.

The American Public Health Association described the cuts as an “ongoing ideological purge” of projects with a purported connection to gender identity, DEI, or “other vague, now-forbidden language.” A coalition of 16 attorneys general, largely Democrats, alleged their public research institutions are facing harm because of the funding delays and cuts.

The district court directed the NIH “to continue paying $783 million in federal grants that are undisputedly counter to the Administration’s priorities,” the department said in its filing.

“Following the change in Administration, the NIH identified, explained, and pursued new funding priorities. That is democracy at work, not, as the district court thought, proof of inappropriate ‘partisan[ship]’—let alone a permissible basis for setting agency action aside.”

In his written opinion, Gorsuch said the district court’s ruling upholding the grants conflicted with the Supreme Court’s decision in Department of Education v. California in April that let the Trump administration withdraw education-related grants.

“Lower court judges may sometimes disagree with this Court’s decisions, but they are never free to defy them,” Gorsuch said.

Unless we want anarchy to take over the federal judicial system, “a precedent of this Court must be followed by the lower federal courts no matter how misguided the judges of those courts may think it to be,” Gorsuch said, quoting a prior Supreme Court ruling.

In his dissenting opinion, Roberts said the district court ruling was justified.

“This relief—which has prospective and generally applicable implications beyond the reinstatement of specific grants—falls well within the scope of the District Court’s jurisdiction under the [federal] Administrative Procedure Act.”

Sotomayor, Kagan, and Jackson joined the dissent in part.

In her dissenting opinion, Jackson said the high court’s new ruling is “Calvinball jurisprudence with a twist,” a reference to a fictional game featured in the comic strip, “Calvin and Hobbes.”

“Calvinball has only one rule: There are no fixed rules. We seem to have two: that one, and this Administration always wins,” she said.

Tyler Durden Fri, 08/22/2025 - 11:05

Trump 'Will Fire Cook' If She Doesn't Resign After Pulte Drops New Receipts

Update: President Trump just told reporters in Washington DC that he'll fire Cook if she doesn't resign. 

.@POTUS on Federal Reserve Governor Lisa Cook: "I'll fire her if she doesn't resign. What she did was bad, so I'll fire her if she doesn't resign." pic.twitter.com/1vEv7k7ar8

— Rapid Response 47 (@RapidResponse47) August 22, 2025

*  *  *

Days after Federal Housing Finance Agency (FHFA) Director Bill Pulte wrote a letter to Attorney General Pam Bondi claiming Federal Reserve Governor Lisa Cook "falsified bank documents and property records to acquire more favorable loan terms" by claiming two homes as her primary residence, Pulte dropped new evidence on Friday suggesting that Cook lied again on a government form. 

"We have obtained a document Lisa Cook submitted to the U.S. Government while serving as Federal Reserve Governor. In it, on February 28, 2023, she represents to the U.S. Government that the Atlanta Property is her PERSONAL RESIDENCE," Pulte wrote on X. "However, Lisa Cook, as a then-sitting Fed Governor and six months earlier, on September 1, 2022, appears to have listed that same property for RENT."

We have obtained a document Lisa Cook submitted to the U.S. Government while serving as Federal Reserve Governor. In it, on February 28, 2023, she represents to the U.S. Government that the Atlanta Property is her PERSONAL RESIDENCE.

However, Lisa Cook, as a then-sitting Fed… pic.twitter.com/clclhtag9O

— Pulte (@pulte) August 22, 2025

Here are the 'receipts' spread out for your perusal: 

Recall that Cook listed the Atlanta Condo has her "Primary Residence" at the same time she was claiming a property in Michigan as her primary residence. 

Last week Pulte wrote a letter to Bondi and DOJ official Ed Martin suggesting that Cook may have committed a criminal offense. The letter alleges that Cook “falsified bank documents and property records to acquire more favorable loan terms, potentially committing mortgage fraud under the criminal statute.”

Bloomberg reports that Pulte said Cook took a mortgage on a property in Ann Arbor, Michigan, signing a mortgage agreement that stipulated she would use the property as her primary residence for at least a year.

Two weeks later, according to the letter, she took another mortgage on a Georgia property and also declared it would be her primary residence.

Pulte also called on Bondi to look into whether Cook misrepresented her circumstances by later listing the Georgia property for rental.

The letter prompted President Trump to respond, demanding "Cook must resign, now!!" 

Cook responded to the accusations; 

“I have no intention of being bullied to step down from my position because of some questions raised in a tweet,” Cook said in a statement.

“I do intend to take any questions about my financial history seriously as a member of the Federal Reserve and so I am gathering the accurate information to answer any legitimate questions and provide the facts.”

Write anything you or your attorneys want Miss Cook, you’ve been caught based on mortgage documents, not a tweet. It’s black and white. We go after people who commit mortgage fraud, and you signed the mortgage documents, no one else. And you did it within 14 days of each other. https://t.co/LIRK89Zaf8

— Pulte (@pulte) August 20, 2025

Of note, she was nominated to the Fed by President Joe Biden and took office in 2022, becoming the first Black woman to serve on the Fed’s board of governors.

She was later nominated by Biden for a full term, which expires in 2038.

Tyler Durden Fri, 08/22/2025 - 10:10

From Fed Chair Powell at Jackson Hole: Monetary Policy and the Fed’s Framework Review. Excerpts:

When I appeared at this podium one year ago, the economy was at an inflection point. Our policy rate had stood at 5-1/4 to 5-1/2 percent for more than a year. That restrictive policy stance was appropriate to help bring down inflation and to foster a sustainable balance between aggregate demand and supply. Inflation had moved much closer to our objective, and the labor market had cooled from its formerly overheated state. Upside risks to inflation had diminished. But the unemployment rate had increased by almost a full percentage point, a development that historically has not occurred outside of recessions.1 Over the subsequent three Federal Open Market Committee (FOMC) meetings, we recalibrated our policy stance, setting the stage for the labor market to remain in balance near maximum employment over the past year.

This year, the economy has faced new challenges. Significantly higher tariffs across our trading partners are remaking the global trading system. Tighter immigration policy has led to an abrupt slowdown in labor force growth. Over the longer run, changes in tax, spending, and regulatory policies may also have important implications for economic growth and productivity. There is significant uncertainty about where all of these polices will eventually settle and what their lasting effects on the economy will be.

Changes in trade and immigration policies are affecting both demand and supply. In this environment, distinguishing cyclical developments from trend, or structural, developments is difficult. This distinction is critical because monetary policy can work to stabilize cyclical fluctuations but can do little to alter structural changes.

The labor market is a case in point. The July employment report released earlier this month showed that payroll job growth slowed to an average pace of only 35,000 per month over the past three months, down from 168,000 per month during 2024 (figure 2).2 This slowdown is much larger than assessed just a month ago, as the earlier figures for May and June were revised down substantially.3 But it does not appear that the slowdown in job growth has opened up a large margin of slack in the labor market—an outcome we want to avoid. The unemployment rate, while edging up in July, stands at a historically low level of 4.2 percent and has been broadly stable over the past year. Other indicators of labor market conditions are also little changed or have softened only modestly, including quits, layoffs, the ratio of vacancies to unemployment, and nominal wage growth. Labor supply has softened in line with demand, sharply lowering the "breakeven" rate of job creation needed to hold the unemployment rate constant. Indeed, labor force growth has slowed considerably this year with the sharp falloff in immigration, and the labor force participation rate has edged down in recent months.

Overall, while the labor market appears to be in balance, it is a curious kind of balance that results from a marked slowing in both the supply of and demand for workers. This unusual situation suggests that downside risks to employment are rising. And if those risks materialize, they can do so quickly in the form of sharply higher layoffs and rising unemployment.

At the same time, GDP growth has slowed notably in the first half of this year to a pace of 1.2 percent, roughly half the 2.5 percent pace in 2024 (figure 3). The decline in growth has largely reflected a slowdown in consumer spending. As with the labor market, some of the slowing in GDP likely reflects slower growth of supply or potential output.

Turning to inflation, higher tariffs have begun to push up prices in some categories of goods. Estimates based on the latest available data indicate that total PCE prices rose 2.6 percent over the 12 months ending in July. Excluding the volatile food and energy categories, core PCE prices rose 2.9 percent, above their level a year ago. Within core, prices of goods increased 1.1 percent over the past 12 months, a notable shift from the modest decline seen over the course of 2024. In contrast, housing services inflation remains on a downward trend, and nonhousing services inflation is still running at a level a bit above what has been historically consistent with 2 percent inflation (figure 4).

The effects of tariffs on consumer prices are now clearly visible. We expect those effects to accumulate over coming months, with high uncertainty about timing and amounts. The question that matters for monetary policy is whether these price increases are likely to materially raise the risk of an ongoing inflation problem. A reasonable base case is that the effects will be relatively short lived—a one-time shift in the price level. Of course, "one-time" does not mean "all at once." It will continue to take time for tariff increases to work their way through supply chains and distribution networks. Moreover, tariff rates continue to evolve, potentially prolonging the adjustment process.

It is also possible, however, that the upward pressure on prices from tariffs could spur a more lasting inflation dynamic, and that is a risk to be assessed and managed. One possibility is that workers, who see their real incomes decline because of higher prices, demand and get higher wages from employers, setting off adverse wage–price dynamics. Given that the labor market is not particularly tight and faces increasing downside risks, that outcome does not seem likely.

Another possibility is that inflation expectations could move up, dragging actual inflation with them. Inflation has been above our target for more than four years and remains a prominent concern for households and businesses. Measures of longer-term inflation expectations, however, as reflected in market- and survey-based measures, appear to remain well anchored and consistent with our longer-run inflation objective of 2 percent.

Of course, we cannot take the stability of inflation expectations for granted. Come what may, we will not allow a one-time increase in the price level to become an ongoing inflation problem.

Putting the pieces together, what are the implications for monetary policy? In the near term, risks to inflation are tilted to the upside, and risks to employment to the downside—a challenging situation. When our goals are in tension like this, our framework calls for us to balance both sides of our dual mandate. Our policy rate is now 100 basis points closer to neutral than it was a year ago, and the stability of the unemployment rate and other labor market measures allows us to proceed carefully as we consider changes to our policy stance. Nonetheless, with policy in restrictive territory, the baseline outlook and the shifting balance of risks may warrant adjusting our policy stance.

Monetary policy is not on a preset course. FOMC members will make these decisions, based solely on their assessment of the data and its implications for the economic outlook and the balance of risks. We will never deviate from that approach.

 

 

This week, I speak with Ellen Zentner, Chief Economic Strategist and Global Head of Thematic and Macro Investing for Morgan Stanley Wealth Management and a member of the Firm’s Global Investment Committee. She and her team are responsible for generating event-driven and forward-looking secular thematic insights, identifying how they can contribute to individual- and institutional-investor portfolios, and guiding stakeholders and internal teams to support the firm’s investment strategies.

Previously, Zentner worked at Bank of Tokyo-Mitsubishi UFJ Ltd., and Nomura Securities International. She began her career working as a Senior Economist for the Texas State government under then Governor George W. Bush.

We discuss everything from tariffs to Fed independence to data integrity at the BLS.

A list of her favorite books 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, Spotify, YouTube, 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 Heather Boushey, previously a member of the Council of Economic Advisers under President Biden, and chief economist to the president’s Invest in America cabinet. She is currently a senior research fellow at the Reimagining the Economy Project at the Harvard Kennedy School.

 

 

Favorite Books

 

Books Barry Mentioned

 

 

 

The post MiB: Ellen Zenter, Chief Economic Strategist at Morgan Stanley appeared first on The Big Picture.

Futures Rebound Ahead Of Powell's Speech

After five days of selling - the longest stretch since Jan 2 - US stock futures halted this week’s run of losses in muted trading ahead of Jerome Powell’s Jackson Hole speech, even as markets scaled back bets on imminent interest rate cuts following very strong economic data on Thursday. As of 8:00am ET, S&P 500 rose 0.2% erasing an earlier decline, while Nasdaq futures rose 0.1% as Nvidia shares fall 1% in premarket after the Information reported the chipmaker had instructed component suppliers to stop production related to the H20 AI chip.  European stocks advanced 0.2%, nudging toward an all-time high. US Treasuries held steady after Thursday’s pullback, with the 10-year rate at 4.33%. The dollar was little changed. there are no scheduled events on the US economic data calendar; Fed Chair Powell is set to speak at 10am ET at Jackson Hole with a slew of other central bank comments expected from the event. The Fed speaker slate also includes Boston Fed President Collins at 9am and Cleveland Fed President Hammack at 11:30am; hawkish comments by Hammack on Thursday pushed yields to session highs. Swap contracts linked to future Fed rate decisions fully price in one quarter-point rate cut this year in October and a second one by year-end.

In premarket trading, Nvidia shares fell 1.1% after the chip giant instructed component suppliers including Samsung Electronics and Amkor to stop production related to the H20 AI chip. Other Magnificent Seven stocks were all higher (Alphabet +1.1%, Tesla +0.5%, Apple +0.5%, Microsoft +0.09%, Amazon +0.4%, Meta +0.2%). Here are the other notable premarket movers: 

• Biohaven shares (BHVN) gain 13% after the company said the FDA communicated to the company on Aug. 21 that an expected decision regarding the NDA for Troriluzole will still be the fourth quarter.
• Cameco (CCJ) shares rise 1.9% in premarket trading after National Bank Financial raised its price target on the uranium company to C$115 from C$110 as it sees the company’s Westinghouse stake adding value.
• Gap shares (GAP) fall 2.1% in premarket trading on Friday as Barclays downgrades to equal-weight from overweight saying the previous bullish scenario for double-digit operating margins by FY26 is off the table.
• Intuit shares (INTU) decline 6.1% ahead of the bell after the tax software company’s tepid forecast overshadowed an otherwise strong fourth quarter report.
• Ross Stores shares (ROST) rise 2.7% after the retailer posted earnings per share for the second quarter that beat the average analyst estimate after better-than-expected tariff-related costs.
• Workday shares (WDAY) drop 5.1% after the human-resources software company reported second-quarter professional services adjusted gross profit that missed estimates. The company also announced it has agreed to acquire Paradox.
• Zoom Communications shares (ZM) rise 5.0% in premarket trading on Friday after the video conferencing company raised its revenue guidance for the full year, beating the average analyst estimate.
• Trucking stocks might be active on Friday after Secretary of State Marco Rubio said that US will halt issuance of worker visas for commercial truck drivers. Watch: Saia, Old Dominion Freight Line, Knight-Swift Transportation and JB Hunt.

A selloff in big tech this week halted the record-breaking rally in US stocks, ahead of Powell’s latest policy blueprint, which will signal whether the Fed will stay cautious on inflation, which is showing signs of stickiness, or tilt toward supporting a softer labor market. A Bloomberg equal-weighted index of the Mag 7 has dropped 3.4% since Monday, putting it on track for its steepest weekly decline since April’s market rout.

The stakes are heightened by pressure from the Trump administration to cut rates and growing divisions within the Fed’s rate-setting committee. To keep his options open, Powell may emphasize that the Fed’s September move will be guided by employment and inflation figures set for release early next month. Swaps have reduced the odds of aggressive near-term easing, now pricing about a 65% chance of a cut next month and fewer than two moves this year. Little more than a week ago, markets were betting on a full quarter-point cut in September, with some traders even positioning for a half-point move. 

Powell is due to speak at 10 a.m. New York time (full preview here). A hawkish speech is expected to weigh on shorter-maturity government bond yields. It could also add pressure to the recent series of large options market trades, which are positioned for an outsized rate cut next month and a total of 75 basis points in reductions by year-end.

“If the Fed doesn’t cut in September, markets will drop because they’re expecting the Fed to do something. If they cut too much, markets may take it as a sign that the Fed is losing its independence, which may trigger much higher inflation,” said Joachim Klement, a strategist at Panmure Liberum. “It’s like Goldilocks with two bears and a bull.”

In Europe, the Stoxx 600 rises 0.2%, led by gains in chemical, health care and auto names. Paper and forestry stocks rise after a report that Suzano will increase pulp prices, while Akzo Nobel gained after activist investor Cevian Capital built a stake in the company. Polish banks plunge after the country’s government announced plans to raise corporate taxes on lenders. Here are the biggest movers Friday:

• Akzo Nobel gains as much 5.4% after activist investor Cevian Capital acquired a 3% stake in the company, putting its weight behind a strategy overhaul at the struggling Dulux paintmaker
• Hensoldt and RENK gain as much as 4.5% and 1.1% after being upgraded to neutral from sell at Citi, with the broker expecting the companies to benefit from Germany’s increased defense spending
• European forestry stocks are rising on Friday after a report that Suzano will increase pulp prices starting in September; Metsa Board shares rise as much as 4.7% and Stora Enso as much as 3.6%
• Standard Chartered gains as much as 3.5% after the US Department of Justice rejected claims by two whistleblowers that it failed to properly investigate allegations of sanctions violations by the bank, the lender said
• Morgan Advanced Materials shares rise as much as 5.1%, the most in more than a month, after the materials and components firm agreed to sell its MMS business unit, including 75% shareholding in MCIL
• Polish banks are among the worst performers in Europe on Friday morning after the country’s Finance Ministry announced plans to raise corporate taxes on lenders to help ease pressure on a strained budget
• Dino Polska shares drop as much as 8.4%, briefly hitting their lowest level in over four months, after the Polish supermarket chain reported results below expectations for the second quarter, according to analysts
• Aspen shares slide as much as 16% in Johannesburg, to its lowest intraday level since April 2020, after the pharmaceutical company said it expects its full-year normalized headline EPS to come in below analyst expectations
• Deutsche Post shares fall as much as 1.5% after Kepler Cheuvreux lowered its recommendation to hold from buy saying the firm will struggle to achieve its Ebit guidance of more than €6 billion

Earlier in the session, Asian stocks crept higher, as a rally in Chinese and South Korean shares helped offset losses in Taiwan and India. The MSCI Asia Pacific Index gained 0.1%, with TSMC among the biggest drags while Tencent supported the regional benchmark. Equities in South Korea gained ahead of President Lee Jae Myung’s visit to Japan. Vietnam’s main equity gauge dropped 2.5%, and Australian shares also fell. A measure of onshore Chinese stocks recorded its biggest weekly rise since November. Gains in local chipmakers provided an added tailwind Friday after a report that US rival Nvidia has instructed component makers to stop production related to its H20 AI chips. Shares also advanced in Hong Kong. Next week will see central bank policy decisions in South Korea and the Philippines.

In FX, the Dollar extended yesterday’s gains overnight and is marginally outperforming across most of the G10 complex as NY sits down. The Norwegian krone is the weakest of the G-10 currencies, falling 0.3% against the greenback. The yen also weakens 0.2%. The Dollar index continued to rally overnight, now at its highest point in two weeks. USDJPY is up 21bps to ~148.75 after Japan’s national CPI data for Jul came in cooler than expectations at +3.1% on headline. And the EUR is mostly unchanged on the day, with mixed signals overnight from data (German Q2 GDP contracted but eurozone wages are up 4% YoY). No major data releases in the US today; all eyes are on Fed Chair Powell at 10AM as well as other speakers at the Jackson Hole Economic Symposium.

In rates, treasuries inch lower, with US 10-year yields rising 1 bp to 4.34%. The 2-year yield is now at the highest level since the beginning of the month at 3.80%, as inflation and price data curbed cuts priced into the next few meetings.  There is little price action in USTs overnight after yesterday's sell-off as the market awaits Powell's speech later this morning. Yesterday, we saw 3bps of cuts priced out of the September meeting, down to a 70% chance of a 25bps cut at the meeting. Gilts underperform, pushing UK 10-year borrowing costs up 3 bps to 4.76% despite today's UK Retails Sales print being delayed until September 5th. JGBs are higher across the curve after inflation data continues to sustain the markets expectations for a rate hike by the BOJ. In terms of flows, we saw two way interest in September FOMC, and flattening of the nominal curve. 

In credit, macro credit is opening the final session of the week just a touch firmer in sympathy with equity futures in the green and European CDS index spreads largely flat. Risk continued to trade soft yesterday for the fourth session in a row. CDX HY came a touch under pressure with risk generically offered, while there was further negative gamma buying of CDX IG protection into the spread widening. FM was the most active community in vol yesterday, leaning generally better buyers of IG vol, while HY vol was offered by both FM and RM. All eyes and ears will be on Powell this morning (10am ET) with any hawkish tone expected to put pressure on the front end of the curve and synthetic credit spreads.

In commodities, oil prices are steady, with WTI crude futures near $63.50 a barrel. Spot gold falls $10.

Looking at today's US calendar, there are no scheduled events. The Fed speaker slate also includes Boston Fed President Collins at 9am and Cleveland Fed President Hammack at 11:30am; hawkish comments by Hammack on Thursday pushed yields to session highs

Market Snapshot

• S&P 500 mini +0.2%
• Nasdaq 100 mini +0.1%
• Russell 2000 mini +0.5%
• Stoxx Europe 600 +0.2%
• DAX little changed, CAC 40 +0.2%
• 10-year Treasury yield +1 basis point at 4.34%
• VIX -0.1 points at 16.53
• Bloomberg Dollar Index little changed at 1211.1
• euro little changed at $1.1598
• WTI crude little changed at $63.48/barrel

Top Overnight News

• Fed officials are reportedly readying to quietly pull back from the signature Flexible Average Inflation Targeting (FAIT) policy innovation announced five years ago in which they focused on the risks brought on by near-zero interest rates and low prices, with officials to abandon that approach as it is now seen as no longer relevant given the backdrop of high and more volatile inflation. According to Nick "Nikileaks" Timiraos noted that Powell is expected to unveil the shift at Jackson Hole on Friday, although changes won’t impact near-term policy decisions and are instead part of the framework the Fed uses to interpret its mandate inflation and employment mandates: WSJ
• Nvidia asked suppliers Samsung and Amkor to stop production related to its H20 AI chip after Beijing urged local firms to avoid using it, The Information reported. CEO Jensen Huang reiterated the processor has no security backdoors. Nvidia shares fell premarket (NVDA -110bps). BBG
• The Trump-Putin Alaska summit followed by the visit of European leaders at the White House were supposed to jump-start momentum to end the Russia-Ukraine war. A week later we are back at the same old stand, as Vladimir Putin is playing familiar tricks and showing no serious interest in a deal. The question is what President Trump will do about it. WSJ
• Elon Musk unsuccessfully tried to enlist Mark Zuckerberg in his unsolicited bid for OpenAI this year. BBG
• Trump said the US is leading the AI race and that AI is the hottest thing in decades.
• Trump's administration reportedly considers a plan to reallocate USD 2bln in CHIPS Act funding for critical minerals and aims to give Commerce Secretary Lutnick greater oversight of minerals financing decisions, according to Reuters citing sources.
• Rubio said the US is pausing all issuances of worker visas for commercial truck drivers with immediate effect. It was separately reported that President Trump's administration said it is reviewing all 55mln people with US visas for potential deportable violations, according to AP.
• Austan Goolsbee called the recent spike in services inflation “dangerous,” but hopes it proves a blip. He also said the September meeting will be “live.” Susan Collins told the WSJ a rate cut may be appropriate if labor market weakness outweighs inflation risks. BBG
• The US won’t demand equity stakes from chipmakers including TSMC and Micron, which are expanding in the US, a person familiar said. BBG
• Euro-zone negotiated wages jumped 4% from a year ago, the ECB said, supporting its caution on further reducing interest rates. BBG
• Japan’s national CPI for Jul came in at +3.1% headline (down from +3.3% in June and inline w/the Street) while the core number (ex-food and energy) was flat at +3.4% (also inline w/the Street) BBG
• Germany’s economic output shrank by more than initially estimated in the second quarter, with industry faring worse than expected as U.S. tariffs hurt exports. Germany’s final Q2 GDP report is revised lower from the preliminary reading (now -0.3% vs. the prior -0.1%). WSJ
• Fed's Collins (2025 voter) signalled an openness for a rate cut as soon as next month amid labor market concerns and flagged that higher tariffs might squeeze consumers’ purchasing power, which could weaken spending. Furthermore, Collins said she expects inflation to continue rising through the end of the year before resuming a decline in 2026, according to a Wall Street Journal article that noted divisions grow inside the Fed ahead of the September rate cut decision and cited Fed's Hammack (2026 voter) opposing cuts due to rising inflation.
• Fed's Goolsbee (2025 voter) said the September FOMC meeting is a live meeting and the Fed has been getting mixed messages on the economy, while he added that the most recent inflation data wasn't great and the Fed still has time to take in more data. Goolsbee responded he doesn't want to get his hands tied, when asked about a September rate cut, as well as commented that a rise in services inflation is a dangerous data point and reacting to a stagflation shock is very difficult. Furthermore, he said central bank independence is critically important, and that tariff increases don't seem close to being done and risk persistent inflation.

Trade/Tariffs

• Chinese President Xi is unlikely to attend ASEAN Leaders' Summit in October, "dashing hopes of a meeting with US President Trump at the summit"; while Premier Li is set to represent China, according to two regional sources cited by Reuters.
• South Korea's Foreign Minister Cho is expected to meet with US Secretary of State Rubio as early as today before the Trump summit with South Korea President Lee, according to Yonhap. South Korean top security adviser confirms discussions with US on increasing defence spending, citing NATO framework as reference; said US investment and weapons purchases are under review. In talks about nuclear power cooperation with the US.
• South Korean top security adviser confirms discussions with US on increasing defence spending, citing NATO framework as reference; said US investment and weapons purchases are under review.

A more detailed look at global markets courtesy of Newsquawk

APAC stocks traded mixed amid cautiousness heading into Fed Chair Powell's remarks at Jackson Hole and following the subdued handover from Wall St, where participants digested a slew of data and mostly hawkish Fed comments. ASX 200 marginally declined with price action choppy around the 9,000 focal point as participants continue to mull over the latest earnings releases. Nikkei 225 swung between gains and losses with participants indecisive after recent yen weakness and somewhat mixed Japanese inflation data, which mostly matched estimates, aside from the slightly hotter-than-expected Core CPI reading. Hang Seng and Shanghai Comp were kept afloat with strength seen following recent earnings releases and with chipmakers supported after Beijing summoned Chinese tech companies to discuss their use of NVIDIA (NVDA) chips and encourage them to use more homegrown options, while NVIDIA ordered a halt to H20 production following China’s directive against purchases.

Top Asian News

• Japan 2026 budget requests to total around JPY 120tln, according to Kyodo.
• China's Industry Ministry said it has issued interim measures for controlling and managing rare earth mining, smelting, and separation.
• PBoC seeks feedback on draft regulations for interbank FX market.

European stocks (STOXX 600 +0.1%) are little changed, albeit with a positive bias amid a lack of newsflow into Fed Chair Powell’s speech in the European afternoon. A bout of risk aversion, with no specific fundamental driver, was seen pre-cash open. Nonetheless, this did little to inflict sustained pressure on European bourses, which have been edging higher since the lacklustre open. European sectors opened mostly in the red after a quiet open. However, positivity has since dominated across the board as sentiment improved. Chemicals sits at the top, led by Akzo Nobel (+5%), after the FT reported that Activist Cevian acquired a more than 3% (EUR 300ln) stake in the company. Banks also underperform, though they are off their worst levels; this comes after Bloomberg reported that Poland is planning to increase corporate income tax for banks, proposing to increase the tax to 30% from 19%.

Top European News

• German Economy Minister said Q2 GDP figures show "urgent need for action"; Further and courageous reforms are unavoidable to make the German economy competitive.

FX

• DXY is firmer on Friday in the run-up to Fed Chair Powell's speech at 15:00BST /10:00 EDT, which is expected to see a text release. Attention will focus on whether Chair Powell’s Jackson Hole remarks indicate any shift in views since recent US data and if he signals a September rate cut, which markets price at ~70% probability. DXY trades in a 98.58-98.83 intraday range after finding support at the 50 DMA (at 98.09 today) earlier in the week. Powell aside, there will be commentary from Collins and Hammack.
• Softer in tandem with the firmer Dollar. EUR remains subdued by the diminishing optimism surrounding Russia-Ukraine, in which US President Trump said, "we will know in about two weeks regarding Russia-Ukraine". Meanwhile, Ukrainian President Zelensky said Russia's overnight attacks show that Moscow is trying to avoid the need for meetings aimed at ending the war. On the data front, German GDP for Q2 was revised lower across the board, albeit this prompted little EUR move at the time, with eyes turning to Fed Chair Powell's speech at 15:00 BST for a dollar-induced impulse. EUR/USD currently sits in a 1.1583-1.1668 range.
• Choppy trade overall in which USD/JPY initially extended on Thursday's advances overnight after returning to the 148.00 territory and was unfazed by the Japanese inflation data, in which Core CPI printed firmer-than-expected. Inflows into the JPY were seen around 15 minutes before the European equity cash open, in tandem with some broader risk aversion despite a lack of fresh catalysts at the time, though it was short-lived. USD/JPY trades in a 148.27-148.77 parameter.
• Not much in the way of Sterling-specific catalysts nor newsflow, with Cable moving in tandem with the Dollar ahead of a long weekend (UK bank holiday on Monday).
• PBoC set USD/CNY mid-point at 7.1321 vs exp. 7.1871 (Prev. 7.1287).

Fixed Income

• USTs are flat and have been trading in a very narrow 111-16 to 111-20 range, as traders await an appearance from Fed Chair Powell at 15:00 BST / 10:00 EDT. On that, focus will be on whether Chair Powell’s Jackson Hole remarks indicate any shift in views since recent US data and if he signals a September rate cut, which markets price at ~70% probability. In terms of price action, currently contained in a minuscule 4 tick range, and within the confines made in the prior session.
• Bunds are also flat/incrementally firmer and trade in a very narrow 128.94 to 129.12 range; the trough today was made in the moments after the release of German GDP revisions, which were lower than the prelim; Q/Q revised down to 0.2% (prev. 0.4%) whilst the Y/Y metric declined 0.3% (prev. no growth).
• Gilts are on the back foot today and underperforming vs peers, albeit within narrow ranges. Nothing really fresh driving things at the moment for UK paper, but perhaps as fiscal-related fears resurge into the Autumn Budget. From a yield perspective, the 10yr has been knocking on the door of the 4.75% mark; traders tout levels above 4.80% as the “danger zone” for Chancellor Reeve’s and her “black hole”.

Commodities

• Modest gains across the crude complex despite the firmer Dollar and alongside the choppy mood across the stock market, with equity bourses swinging from modest losses to mild gains. Upside in the crude complex comes amid diminishing optimism surrounding Russia-Ukraine, in which US President Trump said, "We will know in about two weeks regarding Russia-Ukraine". Meanwhile, Ukrainian President Zelensky said Russia's overnight attacks show that Moscow is trying to avoid the need for meetings aimed at ending the war. On that note, the Hungarian Foreign Minister said oil deliveries to Hungary via the Druzhba pipeline have been halted due to attacks near the Russia-Belarus border. Deliveries seem to be suspended for at least five days, according to reports. WTI currently resides in a 62.05-62.68/bbl range while Brent sits in a USD 67.44-67.95/bbl range.
• Mostly subdued trade across precious metals amid the firmer Dollar as participants look ahead to Fed Chair Powell's speech at 15:00BST /10:00 EDT which is expected to see a text release. Spot gold trades under its 50 DMA (3,346.01) in a USD 3,325.38-3,340.14/oz range.
• Mixed within narrow ranges amid a lack of pertinent drivers this morning ahead of risk events. 3M LME copper prices reside in a USD 9,714.05-9,781.00/t range.
• Hungary and Slovakia call on European Commission to guarantee energy supply security. As a consequence, deliveries seem to be suspended for at least five days.
• Germany said there is no impact on German energy supply security from the Druzhba pipeline disruption.

Geopolitics: Middle East

• Iran's Foreign Minister said he will have a joint phone call with French, British and German counterparts on Friday to discuss nuclear talks and sanctions, according to IRNA.
• "Israeli Defence Minister: We have approved the army's plans to eliminate Hamas and evacuate the population in Gaza", according to Al Arabiya.

Geopolitics: Ukraine

• Hungarian Foreign Minister said oil deliveries to Hungary via the Druzhba pipeline have been halted due to attacks near the Russia-Belarus border.
• North Korean leader Kim lauded military officers who participated in overseas military operations as heroes and said soldiers at Kursk proved the might of the North Korean military in the world's eyes, according to KCNA.
• Russia conducts naval exercises in the Baltic Sea, according to the defence ministry.

Geopolitics: Other 

• China condemned US military build-up off Venezuela coast as foreign interference in regional affairs, according to Fox News. China's Concord Resources plans to invest over USD 1bln in two oilfields in Venezuela, according to Reuters sources, and plans to produce 60k BPD by end-2026.

US Event Calendar

• Nothing scheduled

DB's Jim Reid concludes the overnight wrap

The theme of “good news is bad news” returned to markets yesterday following a strong US PMI release. This led investors to dial back expectations of Fed rate cuts, which sent 10yr Treasury yields +3.7bps higher and left the S&P 500 (-0.40%) posting a 5th consecutive decline for the first time since early January. That leaves investors in a jittery mood going into the Jackson Hole Symposium that kicks off in full today withFed Chair Powell making a speech at 10am EST (3pm LDN) on the US “Economic outlook and framework review”.

Starting with the data, the flash US PMIs for August exceeded expectations, with the manufacturing index (53.3 vs 49.7 expected) rebounding to its highest level since May 2022, while services (55.4 vs 54.2 exp, 55.7 prev.) was resilient at strong levels. The details were also on the hawkish side, with the employment component edging up to its highest since January and the composite output price index rising to 59.3, its highest in three years. Other data was a bit more mixed, with existing home sales rising in July (+4.01m vs +3.92m exp.) but initial and continuing jobless claims moving higher, with initial claims up to +235k in the week ending August 16 (+225k exp).

With the PMIs painting a picture of a resilient US economy with ongoing inflationary risks, markets lowered the probability of a rate cut in September to 72%, its lowest since the weak jobs report on August 1 and down from being fully priced after last week’s CPI print. Bonds also fell, with yields on the 2yr (+4.5bps to 3.79%) and 10yr (+3.7bps to 4.33%) Treasuries moving higher. Equities similarly saw a soft day, with the S&P 500 down -0.40% and the Mag-7 (-0.54%) also posting a 5th consecutive decline. Meta fell -1.15% after it reported a freeze in AI hiring. Unlike the previous couple of sessions the decline was a broad-based one, with more than two-thirds of the S&P 500 down on the day, led by the defensive utilities (-0.71%) and consumer staples (-1.18%) sectors. The slump in the latter was mostly due to Walmart (-4.49%), which hit a rare miss in its earnings yesterday amid higher insurance claims and restructuring costs.

The paring back of rate cut expectations also came amid a pretty patient tone from current Fed officials. Cleveland President Fed Hammack said that the bank’s biggest concern is staying “laser-focused” on inflation, adding that she would not support a rate cut if the meeting was tomorrow. Kansas Fed President Schmid suggested that inflation risks were marginally higher than risks to the labour market, while Chicago Fed President Goolsbee called the last inflation print a “dangerous data point” though he saw the upcoming September meeting as a live one. These comments contrasted with those made by former St Louis Fed President James Bullard, who called for 100bps of rate cuts by the end of this yearstarting with a cut in September. In an interview with Fox Business,Bullard also confirmed that he’d been in contact with Treasury Secretary Bessent about his candidacy for the Fed Chair role.

We’ll learn more on the Fed’s thinking today at Jackson Hole, with all eyes on Powell’s speech at 10am EST. The last time we heard Powell speak at the July FOMC, the Chair was notably hawkish on the labour market, but in light of the July downward payroll revision, we expect a somewhat different tone today. Investors will be keenly watching whether Powell places more emphasis on weaker payrolls versus more stable measures of labour market slack and still solid activity and inflation data. In case you missed it, see our US economists’ preview of what to expect from Jackson Hole here. The topic of Fed independence will also linger over Jackson Hole, with DoJ official Ed Martin yesterday urging Chair Powell to remove Governor Lisa Cook from the board and saying that he intended to investigate her over allegations of mortgage fraud that surfaced on Wednesday.

Turning to Europe, we also got better-than-anticipated composite PMI prints in the Euro area (51.1 vs 50.6 exp, 50.9 prev), with both France (49.8 vs 48.5 exp) and Germany (50.9 vs 50.2 exp) moving higher, as well as in the UK (53.6 vs 51.8 exp). In the euro area the improvement was led by the manufacturing sector, but in the UK it was due to a jump in the services PMI to a 12-month high of 53.6. These were the first PMI prints after the July EU-US trade deal so signs of improved manufacturing activity will be welcome, though tariff volatility could distort the PMIs’ accuracy. In any case, the data led European sovereign bonds to reverse the previous day’s rally, with 10yr gilt (+5.7bps to 4.73%) leading the rise in yields. 10yr OATs (+4.9bps) and bunds (+3.9bps) also sold off, as pricing of ECB rate cuts this year ticked down by -3.9bps to just 9bps.

Despite those positive readings, European stocks saw declines for much of the day, though the Stoxx 600 was back to unchanged by the close and a late rally helped the FTSE 100 (+0.23%) to a new all-time high. The DAX (+0.07%) and FTSE MIB (+0.35%) also advanced, but the CAC (-0.44%) fell back. Healthcare stocks (+0.43%) outperformed within the Stoxx 600 as a joint EU-US statement formalising their July trade deal confirmed that tariffs on pharmaceuticals, chips and lumber will not exceed 15%. The statement also outlined that European cars will face a 15% tariff (down from 27.5% currently) if the EU eliminates tariffs on US industrial goods, and confirmed exemptions for some goods including aircraft and generic drugs.

European markets weren’t helped by waning optimism on Russia-Ukraine peace negotiations. Russia’s Foreign Minister Lavrov accused the US and Europe of undermining progress made at the Trump-Putin Alaska Summit and suggested that security guarantees for Ukraine should be based on the 2022 Istanbul talks. At the time, Russia had proposed an arrangement that would give Moscow a de facto veto over intervention in Ukraine, which is clearly unacceptable to Kyiv. With Lavrov also deflecting on the proposed Putin-Zelenskiy meeting, Ukrainian bonds fell back to levels seen just over a week ago before the Trump-Putin summit. Meanwhile, Rheinmetall rose +3.27%, erasing most of its -5.5% decline over the previous two days. And oil prices advanced, with Brent crude up +1.24% to $67.67/bbl as White House trade advisor Peter Navarro said he expected the additional 25% tariffs on India for buying Russian oil to come into force as scheduled on August 27.

Asian equity markets are trading mostly higher this morning despite the weak handover from Wall Street. The KOSPI (+0.69%) is enjoying a bright start, building on the previous session’s gains, while the Hang Seng (+0.33%), the CSI (+1.18%) and the Shanghai Composite (+0.67%) are also all decently higher. Sectorally, the Hang Seng Tech index (+1.75%) is leading the way, perhaps benefitting from a report by The Information tech news outlet that Nvidia has told component suppliers to stop production related to its H20 chip that’s been designed specifically for the Chinese market. Nvidia’s shares fell by close to 2% in alternative trading on the news, and NASDAQ futures (-0.10%) are marginally trailing those on the S&P 500 (-0.02%) as a result.

Meanwhile, the Nikkei (-0.13%) is down marginally as Japan’s consumer inflation saw a slight moderation but stayed well above the BOJ’s 2% target in July. Headline CPI eased from 3.3% to 3.1% yoy, in line with expectations, but the core (ex fresh food) CPI was a touch above expectations of (+3.1% vs +3.0% exp). The core-core CPI reading that excludes both fresh food and energy prices remained steady at +3.4% y/y in July, suggesting still sticky underlying inflation momentum. Money markets are pricing a 53% chance of a rate hike from the BoJ over the next two meetings, inching a little higher overnight, while 10yr JGB yields are +0.5bps higher at 1.62%, a new post-2008 high.

To the day ahead now, Fed Chair Powell is set to speak at the Jackson Hole Symposium, with a slew of other central bank comments expected from the event. Data releases include the UK’s July retail sales, France’s August business confidence, July retail sales, and Canada’s June retail sales.

Tyler Durden Fri, 08/22/2025 - 08:35

What this means: On a weekly basis, Realtor.com reports the year-over-year change in active inventory and new listings. On a monthly basis, they report total inventory. For July, Realtor.com reported inventory was up 24.8% YoY, but still down 13.4% compared to the 2017 to 2019 same month levels. 
Here is their weekly report: Weekly Housing Trends: Latest Data as of Aug. 16

• Active inventory climbed 20.9% year over year

The number of homes active on the market climbed 20.9% year over year, easing slightly compared with the previous week for the ninth consecutive week. Nevertheless, last week was the 93rd consecutive week of annual gains in inventory. There were roughly 1.1 million homes for sale last week, marking the 16th week in a row over the million-listing threshold. Active inventory is growing significantly faster than new listings, an indication that more homes are sitting on the market for longer.

• New listings—a measure of sellers putting homes up for sale—rose 4.9% year over year

New listings rose 4.9% last week compared with the same period last year, a lower rate compared with the previous week, as the number of new listings remains below the spring and early summer norm. Homeowners are showing less urgency to list, as rising inventory and cautious buyer activity continue to temper the market.

• The median listing price was flat year over year

The median list price was flat compared with the same week in 2024. The median list price per square foot, which accounts for changes in home size, rose 0.1% year over year, extending its nearly two-year growth streak, though this represents the slowest growth rate over that period.

Suspending De Minimis Exemption Next Week Will Cause "Ripple Effect" Across Global Postal Supply Lines

President Trump's elimination of the de minimis duty-free rule at the end of next week is set to fuel a global postal bottleneck, more specifically, with U.S. inbound packages valued at or over $100 likely facing delays as shippers scramble to figure out how the tariff collection process will work. 

In just one week, President Trump's executive order will end duty-free de minimis treatment for low-value imports (items valued less than $800), closing a loophole long exploited by China to flood the U.S. with low-cost junk. The administration stated in late July that the primary goal is to end the flow of deadly synthetic opioids hidden within these small packages. Starting next week, all foreign shipments, except verified gifts under $100, will face new duties. 

Under the new rules, there is quite a bit of confusion about how the new duties will be collected and how to submit the required data. 

A report from Bloomberg lists a number of U.S. inbound postal supply lines beginning to experience bottlenecks because of the tariff collection confusion:

• Asia: Korea Post and SingPost are halting standard parcel services, while Japan warns of delays.

• Europe: Norway, Finland, Austria, Belgium, Czech Republic, and the UK are suspending or limiting services; Deutsche Post/DHL halted business parcels via postal networks.

• Australia: Transit shipments through Australia to the U.S. are paused, though direct U.S. deliveries remain.

Multinational logistics company DHL cited confusion over how duties will be collected in a new letter to customers on Friday. The shipper remains operational. 

"Key questions remain unresolved, particularly regarding how and by whom customs duties will be collected in the future, what additional data will be required, and how the data transmission to the U.S. Customs and Border Protection will be carried out," DHL stated in the letter. 

It's not just DHL; other shippers, including FedEx and UPS, are figuring out how to collect the new tariff fee. Online sellers are also scrambling to comply.  

Millions of low-value packages per day will lose their duty-free treatment by the end of next week and be subject to standard tariff rates or temporary flat fees of $80 to $200 per item for six months.

For more details on rates. Customs and Border Protection outlined last week in a bulletin how the flat fees would be calculated, corresponding to the countries' tariff rates. 

"It is a real concern that the dominoes are falling and there will be a ripple effect where more and more posts announce that they will be suspending packages to the US," warned Kate Muth, executive director of the International Mailers Advisory Group, which represents the U.S. international mailing and shipping industry, quoted by Bloomberg. 

 

Tyler Durden Fri, 08/22/2025 - 08:00

Wild Brawl Breaks Out On Carnival Cruise 'Over Chicken Tenders'

It was anything but smooth sailing aboard the Carnival Sunshine when a massive brawl broke out between furious passengers around 2AM Monday - and the whole thing allegedly started over chicken tenders.

Disturbing footage captured by Bronx content creator Mike Terra shows about two dozen passengers trading blows, tumbling to the floor, and hurling shoes across the deck as shocked onlookers screamed for security.

“Where the fuck is security?!” one frantic bystander yells in the clip as chaos erupts around them.

In the footage, multiple Carnival security officers, appearing quite fatigued, can be seen desperately trying to separate the combatants - but one overwhelmed guard can even be seen backing away and calling for backup as the brawl spiraled out of control.

“Over chicken tenders is crazy!” said Terra, who posted the now-viral video to Instagram (which won't embed, sorry Mike):

NEW: Massive brawl breaks out aboard Carnival cruise ship 'over CHICKEN TENDERS'

Punches were thrown as shoes and phones went flying across the floor

Many bystanders recorded the brawl on their phones, while one shouted: “Where the f** is security?”

The man filming flipped his… pic.twitter.com/QAT9woFV1P

— Unlimited L's (@unlimited_ls) August 20, 2025

He later clarified that while the viral rumor pegged the fight on a late-night food line dispute, the situation may have been “more” than just chicken tenders - though the exact spark remains unclear.

“We weren’t close enough to know why [the fight] really started, we just knew they were in line for food,” Terra told The Post.

* * *

You can support ZeroHedge with the purchase of a high-quality, sharp, ZeroHedge Multitool.

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Terra joked about the Carnival cruise line’s reputation, writing on Instagram; “I always hear Carnival is ghetto/ratchet … I been cruising for years but this my 1st time seeing some action on a ship I was on,” he wrote, adding: “YNs was tripping.”

What are YNs?

h/t Capital.news

Tyler Durden Fri, 08/22/2025 - 07:45

Wuhan Researcher Accused Of Smuggling Biological Material Pleads No Contest

Authored by Eva Fu via The Epoch Times (emphasis ours),

A Chinese researcher accused of smuggling biological materials into a U.S. university lab has pleaded no contest to four charges.

Chinese researcher Han Chengxuan. Sanilac County Sheriff’s Office

Han Chengxuan, a doctoral candidate from the Chinese city of Wuhan who sent multiple packages containing concealed biological materials, pleaded to three smuggling charges and to lying to U.S. customs officials, the U.S. attorney for the Eastern District of Michigan announced.

Han is studying at the College of Life Science and Technology in the Huazhong University of Science and Technology in Wuhan and has co-authored two articles relating to the use of roundworms, known scientifically as C. elegans. She told federal agents that she arrived at the Detroit Metropolitan Airport on a J1 visa in June, intending to start a one-year research project at a University of Michigan lab.

Han estimates that she has sent between five and 10 packages, with several lost on the way, according to the federal complaint.  

U.S. customs intercepted four such shipments between September 2024 and March 2025, addressed to individuals associated with a University of Michigan laboratory with content varying from plasmids—DNA fragments often used to induce genetic modification of organisms—and petri dishes for growing earthworms, the court filing said.

She is the third Chinese researcher facing charges over smuggling materials for biological research. The other two, the Justice Department alleged, attempted to smuggle in a crop-killing fungus for research use at the University of Michigan.

Prosecutors alleged that Han made repeated efforts to mask her actions both while shipping the goods and while speaking with the interrogators.

During an interview with customs agents upon arrival, she initially denied knowledge about sending anything to one recipient until officers brought up specific packages, the complaint stated.

A transcript of the conversation showed that Han described the petri dishes as a water solution containing sodium oxide and sugar, stating: “These ingredients exist in fruit jelly.”

One of the shipments, the prosecutors said, was a book with an envelope with suspected biological materials concealed inside. When confronted, Han initially said she designed a picture game and wanted to send it to the lab associate “to give him a surprise,” according to the court documents.

Omitted in Han’s early statement was the plasmids in the envelope, which she only acknowledged upon close questioning, the prosecutors said.

She told the agents that the recipient and she were classmates in the same major and believed that “he will understand my design.”

Han deleted content on her electronic devices three days before arriving in the United States, stating she wanted to “start fresh,” the federal complaint said.

According to the interview transcripts, Han said that the chat history “takes memory space” and that she cleans messages regularly.

“The University of Michigan invited this Chinese national into our state to be a visiting scholar, where it was going to give her more than $41,000 in a year to do her worm research at the Life Sciences Institute. Something is wrong in Ann Arbor,” said Interim U.S. Attorney for the Eastern District of Michigan Jerome Gorgon.

Han’s sentencing is set for Sept. 10. If convicted, she faces up to 10 years in prison for smuggling goods into the United States and another five years for making false statements.

Tyler Durden Fri, 08/22/2025 - 07:20