Amazon To Invest $20 Billion In Pennsylvania For AI Infrastructure

In the largest private-sector investment in Pennsylvania history, Amazon is plowing $20 billion into two data center campuses to boost its artificial intelligence (AI) and cloud computing capabilities, as the company looks to help solidify America's technological edge over competitors in China and elsewhere.

A data center owned by Amazon Web Services, front right, is under construction next to the Susquehanna nuclear power plant in Berwick, Pa., on Jan. 14, 2024. Ted Shaffrey/AP Photo

The investment by Amazon Web Services (AWS) will create 1,250 high-skilled jobs spanning engineering, cybersecurity and network operations, the company said in a Monday announcement. It will also lead to thousands of construction jobs, and spur broader economic growth through demand for services and suppliers within the data center industry.

One campus will be located next to the Susquehanna nuclear power plant in Salem Township, Luzerne County, while the other will be located in Falls Township, Bucks County, where a US Steel facility was formerly located.

"Amazon’s multi-billion-dollar investment in Pennsylvania reinforces our dedication to advancing AI innovation while creating lasting economic opportunities in the state," according to the company's chief global affairs and legal officer, David Zapolsky. 

As the Epoch Times notes further, to help meet the demand for skilled workers, Pennsylvania will allocate $10 million toward workforce development programs tailored to data center construction and operations, including vocational training and community college partnerships, Shapiro’s office said in an announcement.

Speaking at a press conference in Berwick on Monday, Shapiro said the investment is a generational opportunity to transform Pennsylvania’s economic future, adding that Amazon’s announcement is “just the beginning,” with additional data center projects under consideration in the state.

“From coal and steel, to server farms and fiber optic cables, Pennsylvania is poised to power our future,” Shapiro said. “A future where America dominates the next frontier of AI and doesn’t cede this ground to China or any other nation.”

The announcement comes as the Trump administration intensifies efforts to counter China’s push for global tech supremacy. CIA Deputy Director Michael Ellis recently said that President Donald Trump’s intelligence team is prioritizing the denial of any strategic advantage to China—particularly in advanced technologies AI, semiconductors, and quantum computing.

Calling China an “existential threat,” Ellis said the CIA is focusing increasingly on the tech race. He said that a decisive technological advantage is essential to confronting the Chinese Communist Party’s malign actions against the United States.

The intelligence community’s latest threat assessment underscores these concerns, identifying China as “the most active and persistent cyber threat” to U.S. government systems and critical infrastructure.

In the event of a potential conflict with the United States—most notably over Taiwan—China is likely to carry out cyber offensives designed to paralyze U.S. command infrastructure, stir public confusion, and obstruct the swift deployment of troops, the report warns.

Meanwhile, the Trump administration has ramped up efforts to defend U.S. interests from foreign cyberthreats.

Trump signed an executive order on June 6 aimed at overhauling cybersecurity policy, directing agencies to adopt secure software development practices, improve defenses against hijacking of network interconnections, and accelerate readiness for advanced cryptography.

Tyler Durden Wed, 06/11/2025 - 10:20

The GENIUS Act Showdown: Trump's Crypto Agenda Faces GOP Resistance

Authored by Paul Bradford via American Greatness,

President Trump has made it clear that he will not let the United States fall behind in the global race for digital currency and blockchain innovation. After four years of Biden’s war on crypto, during which he weaponized agencies like the SEC to drive American innovators offshore, Trump is restoring order, sanity, and leadership in one of the most important financial frontiers of the 21st century.

The Trump administration’s success or failure here will determine whether the U.S. dollar remains the global standard. The president and the larger MAGA movement know it. So do millions of everyday Americans who want a financial system that works for them, not against them.

But as the Trump administration works to deliver on the president’s campaign promise, a surprising obstacle has emerged—not from Democrats like Elizabeth Warren, who’s made a career out of demonizing crypto, but from within the Republican Party itself.

At stake is the GENIUS Act, a bipartisan bill that would allow the private sector to create stablecoins pegged to the U.S. dollar.

You may not have heard of stablecoins before. They are essentially cryptocurrencies with stable prices as they are pegged to the value of something stable, unlike typical crypto.

As a relatively new financial instrument, creating stablecoins tied to the U.S. dollar represents a massive opportunity to extend the reach of American finance. Millions of people are already using stablecoins, and this number will only grow larger in the coming years. The Trump administration wants to make sure the ones they use are connected to the U.S. dollar, not the yuan or the Russian ruble. More global demand for the dollar will strengthen its value and allow Americans to purchase more for less.

President Trump wants to sign the GENIUS Act into law before the August recess (ensuring it will not go into effect after China’s stablecoin legislation does this summer).

Last week, Vice President JD Vance reaffirmed this by expressing the White House’s desire for the Senate to pass the bill clean. Because even a well-intentioned amendment can slow the process, fracture the coalition, and ultimately kill the bill.

This is where the problem lies. A couple of Republicans are not listening and are proposing amendments that could kill the bill.

One Republican senator wants to link the Sen. Dick Durbin-backed Credit Card Competition Act (CCCA) to the GENIUS Act. It’s no surprise his colleagues hate this bill, with one even saying he will pull his support for the stablecoin bill if this amendment passes—because it is a major government giveaway to big box stores like Walmart and Target.

The CCCA will use the force of government to mandate that card companies offer retailers at least two payment networks. That might not sound like a big deal, but it is because the high costs of this new regulation would force them to either raise prices or cut back on their consumer benefits programs. That is why The Point Guys, a well-known website that tracks reward points for travel, is opposing the bill, warning that it “has the potential to significantly negatively alter, if not completely eliminate, the world of credit card rewards that we know today.”

Another Republican senator, who said he plans on voting against the GENIUS Act anyway, wants to impose an obstructionist amendment that would cap the credit card interest rates at 10%. This similar “money grows on trees” legislative idea, endorsed by Sen. Bernie Sanders (I-Vt.), would just lead to companies having no choice but to approve fewer lower-income Americans for the credit, even if they desperately need it to stay afloat.

Vice President Vance: This bill must be allowed to pass clean without these distractions. It’s the only way we can beat China before the country’s stablecoin bill goes live in August. With a Republican senator already saying he will vote against the GENIUS Act because of one of these amendments, VP Vance is being proven right.

Democrats are the ones who are supposed to obstruct crypto innovation, not Republicans.

Democrats like Elizabeth Warren spent the last several years trying to suffocate digital innovation in the U.S. under the guise of “consumer protection.” Under Biden, regulators waged war on crypto through intimidation, rulemaking by ambush, and selective enforcement.

Trump has been dismantling that regime from day one. He fired Gary Gensler, repealed Biden’s hostile executive orders, and is replacing consumers’ fear and confusion over crypto with clarity and confidence. He even signed an executive order to create a Strategic Bitcoin Reserve (a digital Fort Knox of sorts), affirming the U.S. commitment to leading, not following, on crypto policy. It would be a shame if a couple of Republicans stood in his way.

Republicans should recognize what’s at stake. This isn’t just another bill. It’s our one shot to beat China at its own game. The alternative is letting political infighting and Beltway gamesmanship stall the president’s agenda, giving the People’s Republic the upper hand.

Trump is doing his job. Now it’s time for Congress to do what the people elected them to do—lead.

Tyler Durden Wed, 06/11/2025 - 10:00

Trump Pressed Netanyahu To 'Permanently End Gaza War' In Phone Call

Israeli media has revealed that in a Monday phone call with Israeli Prime Minister Benjamin Netanyahu, President Trump told the Israeli leader that he must permanently end the war in Gaza.

Trump is said to have conveyed that the conflict should end "the sooner the better"; however, there's been no indication that Trump is willing to use the major leverage he has of cutting off US military aid to enforce this.

Via Reuters

The Israeli military is heavily reliant on American weapons for the war's execution, as well as maintaining readiness against other regional threats like the Houthis out of Yemen or Hezbollah in Lebanon.

The phone call reportedly involved Trump conveying that bringing an end to Gaza operations would help him in nuclear negotiations with Iran, as well as achieving Saudi-Israeli normalization based on the Abraham Accords. These negotiations have been growing tougher, specifically over the question of if the Iranians can maintain any uranium enrichment at all.

In reference to reporting in Israel's Kan public broadcaster and Channel 12, "Trump also ruled out an attack on Iran as the White House seeks to rein in Tehran’s nuclear program in exchange for sanctions relief, according to the reports."

While admitting this week that the Iranians have become "much more aggressive" in negotiations which have taken place in Oman and Rome, Trump's latest statements have been a little less directly threatening in terms of the 'bomb Tehran' 'option'.

For example, here's how Trump responded to a NY Post question on the subject:

“Well, if they don’t make a deal, they’re not going to have a nuclear weapon,” Trump answered. “If they do make a deal, they’re not going have a nuclear weapon, too, you know? But they’re not going a have a new nuclear weapon, so it’s not going to matter from that standpoint.

“But it would be nicer to do it without warfare, without people dying, it’s so much nicer to do it. But I don’t think I see the same level of enthusiasm for them to make a deal. I think they would make a mistake, but we’ll see. I guess time will tell.”

Given the phone call with Netanyahu, it seems the president increasingly sees a Gaza truce deal as crucial to achieving broader stabilization in terms of US interests in the region.

There's also this interesting information via The Times of Israel:

Trump reportedly told Netanyahu that the so-called “Witkoff framework,” which would pause the war for some 60 days in exchange for about half of the hostages held by Hamas, will not suffice.

Meanwhile in Gaza the high death toll continues, amid a controversial plan for a US aid group to oversee humanitarian relieve. Al Jazeera is reporting Wednesday that at least 61 Palestinians, including 39 aid seekers, have been killed by Israeli forces across parts of the Gaza Strip since dawn.

Most Israeli captives still in Hamas' hands are feared dead, but there's widespread acknowledgement that possibly a dozen or more are still alive. Victims' family members in Israel have been pressing the government to achieve another prisoner swap.

Tyler Durden Wed, 06/11/2025 - 09:40

Trump Says China Deal "Done" With 55% Tariffs On Beijing; Will Work With Xi To Open Up China To US Trade

China and the US have agreed to “a done deal” that includes rare earth exports from China and Chinese students attending colleges in the US, President Trump said on Wednesday, pointing to a potential breakthrough aimed at cooling trade tensions that had been reignited by mutual accusations of deal violations.

“Our deal with China is done, subject to final approval with President Xi and me,” Trump posted on Truth Social, as the negotiating teams from the two countries concluded talks in London from the past two days.

“Full magnets, and any necessary rare earths, will be supplied, up front, by China. Likewise, we will provide to China what was agreed to, including Chinese students using our colleges and universities (which has always been good with me!).

“We are getting a total of 55 per cent tariffs, China is getting 10 per cent. Relationship is excellent! Thank you for your attention to this matter!”

Trump’s comments on Wednesday come a day after the US and China reached an agreement in London on implementing the terms of their tariff truce. 

But, as Bloomberg notes, Trump's remarks included terms negotiators did not lay out, such as the immediate supply of critical minerals by China. He also said the US tariff rate would be a “total” of 55% — though the precise rate was not clear. 

That figure includes a 10% baseline duty, a 20% charge tied to fentanyl trafficking and roughly 25% from preexisting levies from Trump’s first term as well as most favored nation rates, according to a White House official. 

In a follow up post, Trump added to the readout, saying that "President XI and I are going to work closely together to open up China to American Trade. This would be a great WIN for both countries!"

American and Chinese officials concluded marathon negotiations on Tuesday, agreeing to revive the flow of sensitive goods, such as critical minerals, and implement the terms of last month’s deal in Geneva, which saw both sides lower tariffs. That deal included a 90-day pause on very high tariffs both nations implemented on each others’ imports that amounted to a de facto trade embargo. It’s unclear whether that deadline, which expires in August, remains in effect.

Trump’s latest post followed a rocky stretch in bilateral ties, marked by a fraying trust between the world’s two largest economies. But a phone call between Xi Jinping and Trump last week helped fuel a sense of cautious optimism ahead of the London talks.  The two negotiating teams finished their latest round of talks by announcing they had agreed “in principle” to a “framework” that each side would bring home for review by their respective leaders, as the world’s two biggest economies attempt to get their trade-war ceasefire deal signed in Geneva last month back on track.

In an official statement released by Xinhua on Wednesday afternoon, Beijing said the two sides “made new progress in addressing each other’s economic and trade concerns” during the “candid and in-depth” dialogue.

Vice-Premier He Lifeng, who led the Chinese delegation, said that “China does not want a trade war, but it is not afraid of one”, according to the statement.

“The two sides should resolve economic and trade differences through equal dialogue and mutually beneficial cooperation. China is sincere in economic and trade consultations, but it also has its principles,” He was quoted as saying.

In London, China’s delegation was led by Vice-Premier He Lifeng. Lutnick, US Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer led the US side in what was described as “the first meeting of the China-US economic and trade consultation mechanism”.

“The two largest economies in the world have reached a handshake for a framework,” said US Commerce Secretary Howard Lutnick, who was with the US delegation.

Unlike the first round of trade talks last month in Geneva, neither side immediately published official statements following the meetings this time.

In mid-May, both sides agreed in Switzerland to roll back the tariffs imposed this year. US tariffs on Chinese goods were reduced to 30 per cent from 145 per cent, while Chinese tariffs on US imports were lowered to 10 per cent, for 90 days. Analysts had earlier estimated that the effective US tariff was about 20 per cent at end of last year, bringing the total effective rate to about 50 per cent, excluding some sectoral tariffs.

Tensions escalated dramatically in the days leading up to last week’s presidential phone call, with both sides accusing each other of violating the 90-day trade truce they had agreed to in Geneva. On the call, just days ahead of the London talks, Xi and Trump agreed to push forward with negotiations aimed at resolving their ongoing economic disputes.

Since last month, the US said it would block and revoke visas for Chinese students, particularly “those with connections to the Chinese Communist Party or studying in critical fields”, according to the US Department of State.

China’s recent export restrictions on crucial rare earth elements through tighter licensing and curbs also rattled sectors across the globe as China dominates the supply chain.

Tyler Durden Wed, 06/11/2025 - 09:20

Oil Rises As Trump Says He's 'Less Confident' About Nuclear Talks With Iran

The NY Post has published a new Trump interview focused on apparently stalled Iran nuclear deal efforts which resulted in a surge in oil prices.

The President said in the interview he's getting "less confident" about ongoing nuclear negotiations with Iran, soon after which oil rose as well as benchmark treasury yields and gold, as investors weigh the possibility of US-Iran nuclear talks falling apart.

Trump was asked whether he thinks the Islamic Republic will agree to shut down its nuclear program. "I don’t know. I did think so, and I’m getting more and more — less confident about it," he responded.

"They seem to be delaying, and I think that’s a shame, but I’m less confident now than I would have been a couple of months ago," Trump continued. "Something happened to them, but I am much less confident of a deal being made."

Then the question was raised by the Post, "what happens then?" To which Trump responded:

“Well, if they don’t make a deal, they’re not going to have a nuclear weapon,” Trump answered. “If they do make a deal, they’re not going have a nuclear weapon, too, you know? But they’re not going a have a new nuclear weapon, so it’s not going to matter from that standpoint.

“But it would be nicer to do it without warfare, without people dying, it’s so much nicer to do it. But I don’t think I see the same level of enthusiasm for them to make a deal. I think they would make a mistake, but we’ll see. I guess time will tell.”

On the question of China's influence on Tehran, Trump described, "I just think maybe they don’t want to make a deal. What can I say?” he said. “And maybe they do. So what does that mean? There’s nothing final."

Via AFP

On Tuesday Trump acknowledged in a Fox News interview that Iran is becoming "much more aggressive" in these negotiations. And the day prior he had told reporters that the Iranians are "tough negotiators" and sought to clarify that he would not allow Tehran to enrich uranium on its soil, after some recent contradictory reports suggested the White House had backed off this demand.

Washington is awaiting a formal response from the Islamic Republic, which is expected to submit a counter-proposal in the coming days, just ahead of an expected sixth round of indirect talks with the US in Muscat, Oman, slated for Sunday, June 15.

* * * 

More geopolitical headlines via Newsquawk:

• Iranian Foreign Minister "As we resume talks on Sunday, it is clear that an agreement that can ensure the continued peaceful nature of Iran's nuclear program is within reach—and could be achieved rapidly.". Thereafter, US President Trump is less confident about the Iran deal, according to a New York Post podcast interview.
• Iranian Foreign Minister says "Trump's position on Iran's possession of nuclear weapons could form the basis of the agreement ", according to Al Arabiya.
• US Secretary of State Rubio said the US condemns sanctions imposed by the governments of the UK, Canada, Norway, New Zealand, and Australia on two sitting members of the Israeli cabinet. Rubio also stated that Israel sanctions do not advance US-led efforts to achieve a ceasefire, bring all hostages home, and end the war, while he added that the US urges a reversal of the sanctions.
• "Iran's Defense Minister warns on US officials' threats of conflict should negotiations falter: We hope for successful talks, but if conflict is imposed on us, Iran will respond decisively, targeting all US bases in host countries.", via Journalist Aslani.
• "Iran successfully tested a missile equipped with a two-ton warhead last week", according to Iran International citing the Iranian Defense Minister.

Tyler Durden Wed, 06/11/2025 - 09:00

Here are a few measures of inflation:

The first graph is the one Fed Chair Powell had mentioned two years ago when services less rent of shelter was up around 8% year-over-year.  This declined and is now up 3.5% YoY.

Click on graph for larger image.

This graph shows the YoY price change for Services and Services less rent of shelter through May 2025.
Services were up 3.7% YoY as of May 2025, unchanged from 3.7% YoY in April.

Services less rent of shelter was up 3.5% YoY in May, up from 3.3% YoY in April.
The second graph shows that goods prices started to increase year-over-year (YoY) in 2020 and accelerated in 2021 due to both strong demand and supply chain disruptions.

Durables were unchanged YoY as of May 2025, up from -0.4% YoY in April.

Commodities less food and energy commodities were at 0.3% YoY in May, up from 0.2% YoY in April.
Here is a graph of the year-over-year change in shelter from the CPI report (through May) and housing from the PCE report (through April)

Shelter was up 3.9% year-over-year in May, down from 4.0% in April. Housing (PCE) was up 4.2% YoY in April, down from 4.3% in March.
This is still catching up with private new lease data (this includes renewals whereas private data is mostly for new leases).
Core CPI ex-shelter was up 1.9% YoY in May.  This key measure has been at or below the Fed's target for 9 of the last 13 months.

Everything Soars Higher As Rate-Cut Odds Jump After CPI 'Miss'

A 'disappointing' CPI print (cooler than expected) has promoted a surge higher in the market's expectation for rate-cut...

Source: Bloomberg

Prompting a surge higher in EVERYTHING.

Stocks spiked...

Treasuries were aggressively bid with 10Y yields sdown 5bps...

Source: Bloomberg

The dollar fell...

Source: Bloomberg

Helping gold to accelerate...

Source: Bloomberg

Goldman said that this would be a materially dovish print (<0.25% MoM for Core CPI) would prompt the bond market to add back at least 2x 25bp rate cuts (it already has) and for Equities to react positively (up 2-2.5%) to the bull steepening that likely ensues.

What excuse will Powell come up with next to NOT cut?

Tyler Durden Wed, 06/11/2025 - 08:52

Fearmongering Pundits Disappointed AGAIN As Consumer Prices Refuse To Surge On Trump Tariffs

In what is reportedly the first real test of the tariff terror pass-through impact on the average American, today's CPI print was expected to rise modestly following survey after survey suggesting the fecal matter is about to strike the rotating object... just like every mainstream media economist warned.

Higher Prices

• ISM Manufacturing prices expanded to 69.8, the highest since June 2022.

• ISM Services ticked up to 65.1 in April, the highest since January 2023.

• S&P Global US Manufacturing firms increased their output prices by the greatest degree since early 2023.

• S&P Global US Services prices advanced.

• Richmond Fed manufacturing showed prices received rose to 2.65 from 2.34 in March.

• New York Fed manufacturing prices received edged up to 28.7 from 22.4 in March.

• Philadelphia Fed manufacturing report showed prices received gained to 30.7 compared to 29.8 in March.

• Kansas City Fed manufacturing prices received surged to 29, up from 15 in March.

• Kansas City Fed non-manufacturing showed selling prices rose in April.

• Dallas Fed manufacturing outlook report showed prices received for finished goods advanced to 14.9, up from 6.3 in March.

• Dallas Fed services selling prices rose to 8.4 from 5.2 in the prior month.

• Chicago PMI showed prices expanded at a faster pace in April.

So what did we get?

A nothingburger... again... as headline and core CPI both printed below expectations.

Headline CPI rose just 0.1% MoM in May (+0.2% MoM exp), inching higher to +2.4% YoY (from +2.3% YoY in April)...

Source: Bloomberg

Energy deflation dominated the headline CPI...

Source: Bloomberg

• CPI increased 0.1% MoM after rising 0.2 percent in April; Over the last 12 months, the all items index increased 2.4 percent before seasonal adjustment. The index for all items less food and energy rose 0.1% in May, following a 0.2% increase in April.

  • The index for shelter rose 0.3% in May and was the primary factor in the all items monthly increase. The food index increased 0.3% as both of its major components, the index for food at home and the index for food away from home also rose 0.3% in May.

  • In contrast, the energy index declined 1.0% in May as the gasoline index fell over the month.

  • Indexes that increased over the month include medical care, motor vehicle insurance, household furnishings and operations, personal care, and education.

  • The indexes for airline fares, used cars and trucks, new vehicles, and apparel were among the major indexes that decreased in May.

• CPI rose 2.4% for the 12 months ending May, after rising 2.3% in April. The all items less food and energy index rose 2.8% over the last 12 months. The energy index decreased 3.5% for the 12 months ending May. The food index increased 2.9% over the last year.

Core CPI was even more disappointing for the average PhD pundit as it rose 0.1% MoM (well below the +0.3% MoM expected), flat with April's +2.8% YoY - the lowest since March 2021...

Source: Bloomberg

Goods prices deflated...

Source: Bloomberg

Some more details on core CPI which rose 0.1% in May, following a 0.2% increase in April.

• The shelter index increased 0.3% over the month.

  • The index for owners’ equivalent rent rose 0.3% in May and the index for rent increased 0.2 percent.

  • The lodging away from home index fell 0.1% in May.

• The medical care index increased 0.3% over the month, following a 0.5% increase in April.

  • The index for hospital services increased 0.4% in May and the index for prescription drugs rose 0.6%.

  • The physicians’ services index fell 0.3% over the month.

• The motor vehicle insurance index rose 0.7% in May, after rising 0.6% in April.

• The index for household furnishings and operations increased 0.3% over the month.

• The personal care index increased 0.5% in May, and the education index rose 0.3%.

• In contrast, the index for airline fares fell 2.7% in May, after declining 2.8% in April.

• The used cars and trucks index fell 0.5% over the month, and the new vehicles index (-0.3%) and apparel index (-0.4%) also declined.

Shelter inflation keeps falling...

• May Rent inflation 3.81% YoY, down from 3.98% in April, lowest since Jan 2022.

• May Shelter inflation 3.86% YoY, down from 3.99% in April, lowest since Nov 2021

On a YoY basis, Services cost price increases continue to slow while Goods prices accelerate very (very) modestly...

Source: Bloomberg

So, we guess we will just have to wait for NEXT MONTH to see the hyperinflationary hellscape that so many TV pundits told us would occur after Trump's terror tariffs were imposed.

Every month https://t.co/pbD9Cc3Wml

— zerohedge (@zerohedge) June 11, 2025

Cue the excuse factory... just wait until next month...

Tyler Durden Wed, 06/11/2025 - 08:41

From the BLS:

The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.1 percent on a seasonally adjusted basis in May, after rising 0.2 percent in April, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 2.4 percent before seasonal adjustment.

The index for shelter rose 0.3 percent in May and was the primary factor in the all items monthly increase. The food index increased 0.3 percent as both of its major components, the index for food at home and the index for food away from home also rose 0.3 percent in May. In contrast, the energy index declined 1.0 percent in May as the gasoline index fell over the month.

The index for all items less food and energy rose 0.1 percent in May, following a 0.2-percent increase in April. Indexes that increased over the month include medical care, motor vehicle insurance, household furnishings and operations, personal care, and education. The indexes for airline fares, used cars and trucks, new vehicles, and apparel were among the major indexes that decreased in May.

The all items index rose 2.4 percent for the 12 months ending May, after rising 2.3 percent over the 12 months ending April. The all items less food and energy index rose 2.8 percent over the last 12 months. The energy index decreased 3.5 percent for the 12 months ending May. The food index increased 2.9 percent over the last year.
emphasis added

The change in CPI was slightly below expectations. I'll post a graph later today after the Cleveland Fed releases the median and trimmed-mean CPI.

Futures Drop After US-China Trade Talks Fall Flat, CPI Looms

US equity futures dropped into today's CPI print after traders weren't moved by the US-China trade talks, which saw the two two sides agree on a framework to implement last month’s Geneva deal with few actual details.  There’s also nervousness ahead of inflation data: a hot reading would be a big risk factor for a market near record highs (see full preview here). As of 8:00am ET, S&P and Nasdaq 100 futures traded 0.2% lower but were off session lows; pre-market Mag7 names are mostly higher with TSLA (+2%) the standout after a contrite Elon Muskusk tweeted "I regret some of my posts about President @realDonaldTrump last week. They went too far." Semis and Cyclicals are poised to outperform. In other trade news, US/Mexico were close to a deal on steel tariffs by using import caps, which would be higher than the previous cap, and would remove the 50% tariff on steel below said cap; this looks like a reversion to 2018 levels and may be a template for talks with Canada. The G7 summit will carry additional weight as we are a month away the expiration of the 90-day tariff delay, with only a US/UK framework on the tape. Elsewhere, the EU is said to see talks with the US going beyond a July 9 deadline. The yield curve is twisting steeper with 10Y yields higher, the USD is slightly higher and commodities rise with crude and gold higher after Trump told the NY Post that he’s getting “less confident” about nuclear talks with Iran; natgas and base metals also rallied with Ags are down. The key event today is the CPI report at 8:30am ET where economists expect a relatively tame number, with core inflation up 0.3% in May. Positioning suggests a hotter print will be punished more than a dovish one will be rewarded, according to JPMorgan.

In premarket trading, Tesla rose over 2% in, outperforming Magnificent 7 counterparts after Elon Musk expressed regret over his recent social-media outburst directed at Trump.

I regret some of my posts about President @realDonaldTrump last week. They went too far.

— Elon Musk (@elonmusk) June 11, 2025

Other Mag7 moves: Alphabet -0.1%, Microsoft -0.4%, Apple little changed, Nvidia little changed, Amazon -0.4%, Meta Platforms -0.3%. Steel stocks fell as the US and Mexico close in on a deal that would remove 50% tariffs on steel imports up to a certain volume — seen to erode the advantage US steelmakers would have benefited from if imports from Mexico faced higher rates. (Cleveland-Cliffs drops 5%, Nucor -3%, Steel Dynamics -1.6%). Here are some other notable movers:

• Cleveland-Cliffs (CLF) drops 5%, Nucor (NUE) -3%, Steel Dynamics (STLD) -1.6%
• American Superconductor (AMSC) falls 16% after the grid systems provider was said to offer shares at a discount.
• Chewy Inc. (CHWY) falls 6% after the pet food company posted first quarter results.
• Dave & Buster’s (PLAY) gains 6% after commentary that sales are improving reassured analysts, even as the restaurant and entertainment company’s first-quarter results came in lighter than expected.
• Etsy (ETSY) falls 3% after the online marketplace announced a proposed private offering of $650 million of convertible senior notes
• GameStop (GME) declines 5% after the video-game retailer posted a 17% decrease in 1Q net sales.
• Getty Images (GETY) jumps 5% after Shutterstock shareholders approved their merger agreement. Shutterstock (SSTK) gains 5%.
• Lockheed Martin Corp. (LMT) slips 2% after the Air Force has cut in half its request to Congress for its signature F-35s, dealing a blow to the top US defense contractor.

Tuesday’s thinly detailed outcome of the Trump administration’s trade talks with China in London left traders and investors underwhelmed. Markets were watching whether the world’s top two economies could damp down tensions that economists say have tipped the global economy into a downturn. After some 20 hours of negotiations, US officials said both sides had established a framework to revive the flow of sensitive goods, even though the plan still needs sign-off from Trump and Xi Jinping.

“A preliminary agreement doesn’t fill me with enthusiasm in terms of this being resolved,” Guy Miller, chief market strategist at Zurich Insurance Co., told Bloomberg TV. “This is going to continue to be pushed down the line.”

On Wednesday morning, Trump tweeted that the "deal with China is done" and that "we are getting a total of 55% tariffs, China is getting 10%."

In other trade news, a Federal Court of Appeals extended an earlier, short-term reprieve for the administration as it presses a challenge to a lower court ruling last month that blocked tariffs. Steel stocks are trading lower after Bloomberg reported the US and Mexico are closing in on a deal that would remove 50% tariffs on steel imports up to a certain volume.

Trade (non) deal aside, CPI is top of mind today. Economists expect a relatively tame number, with core inflation up 0.3% in May. Positioning suggests a hotter print will be punished more than a dovish one will be rewarded, according to JPMorgan (full CPI preview here). Economists expect a modest impact from tariff pass-through for goods that are mostly imported. They see inflation rising 0.3% from April after increasing 0.2% the previous month, excluding the volatile food and energy categories. The core CPI, which is regarded as a better indicator of underlying inflation, is seen accelerating for the first time this year — to 2.9% — on an annual basis.

The CPI report, along with producer price data due Thursday, will offer Federal Reserve officials a final look at inflation and the impact of high tariffs before they gather next week Traders are increasingly betting that policymakers will cut rates only once this year.

“It is not expected to be market-moving for now but that could increase the scope for an impact from a big surprise,” said Geoff Yu, FX and macro strategist at Bank of New York Mellon Corp. “We expect a more data-driven session as some repositioning is needed ahead of a key central bank week.”

Investors have been shifting to under-owned, riskier pockets of the market like small caps and high-beta stocks, with Nomura strategist Charlie McElligott citing a “right-tail” risk. Nasdaq has led the recent US equity gains, while technicals are becoming tricky with RSI and MACD indicators showing a bearish divergence.

Global stocks are likely to rally another 3% into the end of the year, while in Europe, there’s scope for corporate earnings to see more upgrades, according to Citigroup.

Concerns about a ballooning US budget deficit and demand for long-end bonds have caused the yield on 30-year Treasuries to spike in recent weeks. A downgrade of US sovereign debt by Moody’s Ratings last month has prompted Hong Kong pension fund managers to form a preliminary plan to sell down their holdings if the US loses its last recognized top credit rating, Bloomberg News reported Wednesday.

In Europe, the Stoxx 600 is flat as banking and basic resources lead stocks, while the retail sector is the biggest laggard, with Inditex SA falling 6.4% after Zara owner’s sales missed estimates. Here are the most notable European movers: 

• Bayer shares rise as much as 2.8% to their highest value since October as HSBC and Kepler Cheuvreux upgrade the German pharmaceutical and chemicals company to buy from hold.
• Demant shares rise as much as 4%, to the highest since Jan. 31, after the Danish company agreed to acquire hearing-aid retailer KIND Group for €700m, or around DKK5.2b, on a cash and debt-free basis.
• Quilter advances as much as 4.9%, as UBS upgrades the wealth management firm to buy from neutral and sets a Street-high target on greater conviction of a recovery in flows.
• Assura shares rise as much as 2.5% after KKR and Stonepeak made their best and final offer for the healthcare property group.
• European mining shares are among the best-performing sectors in the Stoxx 600 benchmark, as iron ore and base metals gain after the US and China agreed to a preliminary plan to ease trade tensions.
• Inditex shares drop as much as 6.4%, the day’s worst-performer in the Stoxx 600 Index, after the Spanish retailer reported a muted start to the second quarter and warned that foreign-exchange headwinds could have a large impact on results this year.
• Fuller Smith & Turner shares slip as much as 2.2% after the pub and hotel operator issued a trading update. Peel Hunt downgraded the stock, noting that growth in the group’s like-for-like sales eased slightly in the first weeks of fiscal year 2026, after a “strong year.”
• Deutsche Boerse shares drop as much as 2.8% to trade at a six-week low after being downgraded by UBS, with analysts arguing there is limited room for further consensus upgrades or multiple expansion.
• Ibstock shares plunge as much as 18%, the most since 2016, after analysts warned the building materials supplier’s higher costs and lower pricing has led to a weaker earnings outlook for this year.
• Technoprobe shares drop as much as 8.6% to €6.9, after the Italian chipmaker’s main shareholder T-Plus announced the sale of a 1.53% stake at a price of €7 per share.
• GlobalData shares fall as much as 17%, the most since January 2009, after the analytics firm announced that it has terminated discussions with private equity firm ICG over its possible cash offer.

Asian stocks rose, with sentiment lifted by a preliminary deal between the US and China to de-escalate trade tensions. The MSCI Asia Pacific Index rose as much as 0.4%, on track for a third day of gains. Chip stocks provided the biggest boost after TSMC posted a 40% increase in May revenue, in a sign of resilient AI demand. Most regional gauges were in the green. Chinese equities led gains in the region, with the onshore benchmark CSI 300 Index climbing 0.8%, the most in nearly a month. The Hang Seng China Enterprises Index gained as much as 1.4%. South Korea’s Kospi rose 1.2%, capping a sixth-straight daily advance. Risk-on trades got a lift after negotiators from the world’s two largest economies said they had agreed on a framework on how to implement the consensus reached in their prior round of discussions. Officials at the talks in London are expected to take the latest proposal back to their respective leaders in Washington and Beijing.

In FX, the Bloomberg Dollar Spot Index is little changed. The euro and Swiss franc are the best performing G-10 currencies, rising 0.2% each. The kiwi is the laggard with a 0.2% fall.

In rates, treasuries decline ahead of CPI data, following a bigger drop for UK gilts, where focus is on fiscal policy ahead of Chancellor Rachel Reeves’ spending review. US session includes May CPI data and 10-year note auction.  US yields are 1bp-4bp cheaper across a steeper curve, with 2s10s and 5s30s spreads unwinding most of Tuesday’s flattening move. 10-year near 4.50% is ~3bp cheaper on the day; German counterpart is comparable; Gilts lead a selloff in European government bonds, pushing UK 10-year yields up ~6 bps to 4.60%. Bunds pare declines after solid demand at a 10-year auction. 

In commodities, spot gold climbs $14 to around $3,337/oz. Oil prices swing, with WTI now up 0.9% to around $65.50. 

Bitcoin finds itself in the red this morning, specifics for the space light after a handful of equity-related updates for the complex overnight.

To the day ahead now, and as we previewed earlier, look out for the US May CPI release as well as the federal budget balance data. Also worth mentioning that the US 10-yr treasury auction will be held. We’ll also get the Canada April building permits. In terms of central bank speakers, we’ll hear the ECB’s Lane and Cipollone speak. Earnings include Oracle and Inditex

Top Overnight News

• The US and China agreed on the outlines of a plan to revive the flow of sensitive goods. Howard Lutnick said Beijing pledged to speed up rare earth metal shipments, while Washington would ease some export controls. The agreement still needs approval from Donald Trump and Xi Jinping. BBG
• Los Angeles Mayor said they declared a local emergency and a curfew for Downtown Los Angeles from 8pm-6am which is expected to last several days.
• Tesla (TSLA) CEO Musk posts "I regret some of my posts about President Trump last week. They went too far."
• The US Court of Appeals Tues night ruled that Trump’s IEEPA tariffs (which includes the 10% baseline, the suspended reciprocal tariffs, and the fentanyl tariffs on Mexico, Canada, and China) will stay in place for the duration of the appeals process, but with the case expedited with oral arguments scheduled for Jul 31. Court of Appeals
• EU hopes to have a tentative framework agreement in place by the Jul 9 reciprocal tariff suspension deadline, but warns that a full deal will require more time. BBG
• The US and Mexico are closing in on a deal that would remove President Donald Trump’s 50% tariffs on steel imports up to a certain volume, according to people familiar with the matter, a revamp of a similar deal between the trade partners during his first term. BBG
• Oil rose after Trump told NYP that he’s getting “less confident” about nuclear talks with Iran. Benchmark Treasury yields and gold rose. BBG
• Senate Republicans back off plans to make changes to Medicare in the reconciliation bill. Politico
• Tesla set June 22 as a tentative launch date for its robotaxi service. BBG
• Japan’s PPI cools by more than anticipated, coming in at +3.2% Y/Y (vs. the Street +3.5% and down from +4.1% in Apr). BBG

Market Snapshot

• S&P 500 mini -0.1%
• Nasdaq 100 mini little changed
• Russell 2000 mini +0.2%
• Stoxx Europe 600 +0.1%
• DAX +0.4%
• CAC 40 +0.4%
• 10-year Treasury yield +2 basis points at 4.49%
• VIX little changed at 16.98
• Bloomberg Dollar Index little changed at 1210.19
• euro +0.1% at $1.144
• WTI crude little changed at $65.01/barrel

Trade/Tariffs

• US Commerce Secretary Lutnick said they have reached a framework to implement the Geneva consensus and the outcome from the leaders' call on June 5th, while he added that they are going to go back and see if US President Trump approves it and if approved, they will implement it. Lutnick noted the idea behind this is to increase trade with China with the framework the first step and they had to get the negativity out. Furthermore, he said they expect the rare earths and magnets issues will be resolved in this framework and he reiterated that they reached a framework to implement the agreements reached.
• USTR Greer said they are focused on full compliance and don't have another meeting scheduled but added they are in constant contact with China and are moving as quickly as they can. Greer stated that they feel positive about engaging with the Chinese and expect to see progress from China on fentanyl, while he noted it is up to the President whether the deadline gets extended.
• Chinese Vice Commerce Minister Li Chenggang said talks with the US had involved in-depth exchanges and communication had been rational and candid, while the two sides reached a consensus regarding the Geneva meeting. Li added he will report on the framework to leaders and hopes the progress is conducive to increasing the trust between China and the US.
• Chinese Foreign Ministry spokesperson Lin says no information to offer on US-China meeting in London.
• China Vice Premier, on China-US talks in London, says China's stance on trade issues with the US is clear and consistent; China not willing to fight but not afraid to fight; vows to reduce misunderstanding with the US. Both sides should enhance consensus. Both sides should jointly safeguard the hard won outcome from the dialogues. Both sides should maintain communication. Should push for stable and long-term China-US trade and economic ties. China is sincere in trade and economic consolations but has its principle.

A more detailed look at global markets courtesy of Newquawk

APAC stocks were mostly higher amid the recent trade-related optimism stemming from the US-China trade talks in London which have now concluded and where officials reached a framework to implement the Geneva consensus and outcome from the recent Trump-Xi call. ASX 200 advanced to print a fresh record high in early trade before paring some of the gains amid little fresh catalysts. Nikkei 225 marginally benefitted from recent currency weakness and softer-than-expected PPI data. Hang Seng and Shanghai Comp gained following the progress in US-China trade talks, albeit with the upside in the mainland capped given the lack of solid details.

Top Asian News

• Hong Kong Financial Secretary Chan said expect equity markets to continue to be strong and the IPO pipeline remains strong.
• BoJ Governor Ueda said markets' risk adverse moves are subsidising somewhat but uncertainty is very high, according to a cabinet member; Ueda said the BoJ will continue to scrutinise market moves, and its impact on the economy. Told those in the Monthly economic report: that domestic financial conditions remain accommodative

European bourses are generally marginally firmer, EuroStoxx 50 +0.2%, defying indications for a slightly softer cash open. However, this comes with the exception of the IBEX 35 -0.8%, given marked pressure in Inditex (-3.3%).
Sectors are mixed with Retail -1.0% the laggard given the above Inditex action. Basic Resources, Tech, Consumer Products & Services all benefit from the US-China updates. Stateside, futures are modestly into the red with subdued trade despite the framework agreement between US-China officials as we now await the response from President's Trump & Xi; ES -0.3%. Attention in the meantime firmly on CPI. NVIDIA (NVDA) CEO Huang says there is an inflection point happening in Quantum computing.

Top European News

• ECB and PBoC sign MoU on cooperation in the field of central banking, according to a press release.
• BoE confirms re-calibration of indexed long-term repo operation.
• ECB's Vujcic says he's looking for more clarity on the trade front.
• ECB's Kazaks says it is "quite likely" that 2% inflation will require some further cuts for fine tuning, via Econostream on X; market pricing of one or more cut is not out of the realm of the baseline. May at some point go into accommodative territory. So far, seems the deflationary effect of trade tensions could dominate, but the final outcome is open.
• ECB's Lane says last week's rate cut will guard against any uncertainty about the Bank's reaction function by showing they are committed to returning inflation to target; conditions today are far more favourable for blue EU bond issuance on prudent scale.
• UK Foreign Secretary Lammy is reportedly en-route to Brussels to sign off on UK-Spain deal over Gibraltar's post-Brexit future, via Telegraph's Barnes.

FX

• DXY has seen a bit of two-way action this morning. Initially contained in the wake of US-China talks before coming under a little bit of pressure and losing 99.0 to the downside as EUR and GBP picked up. Nonetheless, the index remains within yesterday's 98.86-99.39 range.
• EUR unreactive to ECB officials this morning with macro drivers for the bloc light. Latest ECB wage tracker was hawkish but sparked no move. Given US CPI shortly, the USD-side of the equation will likely dictate the Single Currencies fortunes, currently in Tuesday's 1.1373-1.1447 band.
• JPY a touch softer, USD/JPY holding above 145 in a 144.66 to 145.24 band. Japanese PPI metrics printed softer-than-expected overnight, which is also adding to the weakness in the JPY. Handful of remarks from Ishiba recently, though no follow through just yet.
• Cable unable to recoup much of the lost ground seen in the wake of yesterday's soft UK jobs report which sent the pair to a 1.3457 session low. Currently just about in the green against the USD, holding at 1.35.
• PBoC set USD/CNY mid-point at 7.1815 vs exp. 7.1801 (Prev. 7.1840).
• JPMorgan revises USD/CNY target to 7.15 (prev. 7.30), cites moderating tariff risks and de-dollarisation theme, expects "gentle downtrend" to 7.10 by Q2 25.

Fixed Income

• Fixed benchmarks pressured across the board. Gilts the underperformer after Tuesday’s session of pronounced gains. Gilts opened softer by a handful of ticks, before extending to current losses of c. 30 ticks; marginal pressure around supply, largely awaiting the Spending Review.
• Aside from ECB speak, which has not influenced price action, updates for EGBs have been light. Bunds in the red by around 15 ticks, but still higher by around 40 ticks WTD.
• USTs softer but, compared to the above, are much closer to the unchanged mark. As we await updates from the US and/or China President, CPI and then 10yr supply (3yr passed without impact). Amidst this, yields firmer across the curve which is slightly steeper.
• UK sells GBP 4.25bln 4.50% 2035 Gilt: b/c 2.98x (prev. 3.13x), average yield 4.588% (prev. 4.673%) & tail 0.3bps (prev. 0.3bps).
• Germany sells EUR 2.336bln vs exp. EUR 3.0bln 2.50% 2035 Bund: b/c 2.7x (prev. 2.4x), average yield 2.54% (prev. 2.66%) & retention 22.13% (prev. 23.7%).
• Hong Kong pensions intend to cut USTs if the US loses its AAA grade, via Bloomberg.
• PIMCO’s fixed income CIO Balls said, on BBG TV, the five to ten year part of the US curve is where you would want to be. Adds, Japan looks like an opportunity. On today’s UK Spending Review, Balls remarked that it should not be a significant market event.

Commodities

• Initially, a mild upward tilt across the crude benchmarks after Tuesday's declines. However, the complex returned to earlier lows amid commentary from the Iranian Foreign Minister on the potential for a nuclear agreement this weekend.
• WTI Jul moved to the bottom of a USD 64.60-65.68/bbl range while Brent Aug sits in a USD 66.47-67.10/bbl parameter on the above; since, the benchmarks have bounced and are now marginally firmer once again. Potentially picking up as Trump says he is less confident about an Iran deal, speaking with the NY Post.
• Spot gold gradually edges higher but just about remains within yesterday's parameters after recent choppy performance and with US CPI on the horizon.
• Base metals mixed, copper struggled for direction overnight awaiting US-China developments. Elsewhere, a handful of production updates from Codelco, Collahuasi, Escondida and China also factoring.
• US Private Inventory Data (bbls): Crude -0.4mln (exp. -2mln), Distillates +3.7mln (exp. +0.8mln), Gasoline +3.0mln (exp. +0.9mln), Cushing -0.7mln.
• Chinese steel production is expected to decline by 4% in 2025, according to the China Iron and Steel Association.

Geopolitics

• Iranian Foreign Minister "As we resume talks on Sunday, it is clear that an agreement that can ensure the continued peaceful nature of Iran's nuclear program is within reach—and could be achieved rapidly.". Thereafter, US President Trump is less confident about the Iran deal, according to a New York Post podcast interview.
• Iranian Foreign Minister says "Trump's position on Iran's possession of nuclear weapons could form the basis of the agreement ", according to Al Arabiya.
• US Secretary of State Rubio said the US condemns sanctions imposed by the governments of the UK, Canada, Norway, New Zealand, and Australia on two sitting members of the Israeli cabinet. Rubio also stated that Israel sanctions do not advance US-led efforts to achieve a ceasefire, bring all hostages home, and end the war, while he added that the US urges a reversal of the sanctions.
• "Iran's Defense Minister warns on US officials' threats of conflict should negotiations falter: We hope for successful talks, but if conflict is imposed on us, Iran will respond decisively, targeting all US bases in host countries.", via Journalist Aslani.
• "Iran successfully tested a missile equipped with a two-ton warhead last week", according to Iran International citing the Iranian Defence Minister.

Economic Data 

• 7:00 am: Jun 6 MBA Mortgage Applications 12.5%, prior -3.9%
• 8:30 am: May CPI MoM, est. 0.2%, prior 0.2%
• 8:30 am: May CPI Ex Food and Energy MoM, est. 0.3%, prior 0.2%
• 8:30 am: May CPI YoY, est. 2.4%, prior 2.3%
• 8:30 am: May CPI Ex Food and Energy YoY, est. 2.9%, prior 2.8%
• 2:00 pm: May Federal Budget Balance, est. -314b, prior -347.13b

DB's Jim Reid concludes the overnight wrap

I have a dark secret I'm holding onto at the moment. It's my birthday tomorrow and over the weekend our family photo stream had pictures of one of my presents. My wife is not as tech savvy as she could be. A voucher for a round with Rory Mcllroy? No sadly, but instead a portrait for my office (I assume) of our dog Brontë swinging a golf club dressed in plus fours. It's very amusing and cute. I will show surprise and gratitude tomorrow. If I do a WFH webinar again no doubt I'll show you all and you can smile or shake your head with horror. 

Overnight, US and Chinese negotiators have said they've agreed on a framework of how to implement the agreement reached at talks in Geneva last month. The main details came from Commerce Secretary Lutnick, who said that “We do absolutely expect that the topic of rare earth minerals and magnets” will be resolved and that export controls implemented by the US should come down as China approves relevant export licenses. China’s trade representative Li Chenggang said that the US and Chinese delegations will now take the proposal back to their respective leaders, with Lutnick noting that “once the presidents approve it, we will then seek to implement it”. At the same time, there was no evidence of progress on topics such as the fentanyl-related 20% tariffs on China that the US has implemented since February. So while the mood music has stayed positive, investors may be wary of the pattern that emerged during the previous US-China trade talks in 2018-19, when apparently constructive in person meetings seemed to take a step back as the negotiating teams returned to their capitals. So there's perhaps a little disappointment this morning that we haven't yet got a bigger announcement, even though there's time to hear the full conclusions of the meeting. 

In other trade news last night, the US Court of Appeals extended its temporary reprieve for the administration’s tariffs that had been blocked by the US Court of International Trade in late May, as it scheduled arguments in the case for July 31. So that leaves wide-ranging tariffs imposed under the International Emergency Economic Powers Act in place, while confirming that the legal uncertainty over their use will remain unresolved until well after the July 9 deadline for the reciprocal tariff delay. Separately, Bloomberg reported yesterday that the US and Mexico are close to a deal that would remove 50% of steel imports from Mexico up to a certain quota, adding to the sense that sectoral tariffs are up for negotiation in US talks with trading partners.

Turning to yesterday’s market moves, given the focus on export controls that have affected chips and rare earth metals, and the hope the restrictions would be eased, semiconductor and technology stocks benefited, helping to lift US equities more broadly. For instance, the Philadelphia Semiconductor Stock Exchange (+2.06%) continued to rally on the hope for a positive outcome, advancing for the third consecutive day. Similarly, the Mag-7 also advanced +1.29% thanks to Tesla’s (+5.67%) continued recovery as well as decent gains for Alphabet (+1.43%) and Meta (+1.20%). And chipmaker TSMC was up +3.98% after the company reported monthly sales that climbed +39.6% in May.

Another notable story yesterday was a Bloomberg report that Treasury Secretary Bessent was being considered as a potential successor to Powell as Fed Chair. However, the report acknowledged that formal interviews for the role have not yet begun, and later in the day the White House denied that Bessent was a contender for the Fed job. The story follows comments by Trump last Friday that the decision on the next Fed Chair may be “coming out very soon” and yesterday our US economists published a note with initial thoughts on the topic of Powell’s replacement.

Looking forward, the focus will now turn back to inflation, with the May CPI results coming out later. Our US economists have a full preview here, and their view is that weak seasonally adjusted gas prices should continue to keep monthly headline CPI (+0.20% expected) below core inflation (+0.31% expected). A critical thing to look out for will also be the tariff pass-through, so they’ll be focusing on core goods prices, especially in categories like household furnishings and supplies categories, which saw some preliminary impact in the April data. Bear in mind that even with the 90-day tariff extension, the baseline 10% tariffs have still been in place for the entire month, and the reduction in the China tariffs from 145% to 30% wasn’t announced until May 12, so there were plenty of tariffs in place in May.

Speaking of inflation, there were fresh signs of inflationary pressure from the NFIB’s small business optimism index. In particular, a net 31% said they were planning to raise average selling prices, the highest share in over a year. But there was some brighter news, as the headline index showed that for the first time in 2025, small business had grown more optimistic, with the headline gauge up to 98.8 in May (vs. 96.0 expected), and up from 95.8 the previous month. So that points to a rebound in sentiment as the administration have dialled back tariffs in recent weeks.

Ahead of the CPI print, US Treasuries were pretty stable yesterday with an ongoing flattening of the curve. For instance, the 2yr yield (+1.6bps) moved up to 4.02%, whilst the 10yr yield (-0.4bps) fell to 4.47%, marking the flattest level of the 2s10s slope in two months. Those modest moves came amid an uneventful 3yr auction that saw $58bn of notes issued +0.4bps above the pre-sale yield. This will be followed by a 10yr auction today, and then a 30yr auction tomorrow, which will be an important focal point given recent fiscal fears.

Over in Europe, the latest UK labour market data pointed to growing weakness in Q2. In particular, the number of payrolled employees was down -109k in May (vs. -20k expected). Moreover, average weekly earnings growth fell to +5.3% in the three months ending April (vs. +5.5% expected). So that led investors to dial up the likelihood of rate cuts by the Bank of England, with the probability of a rate cut by the August meeting up to 81%. In turn, that meant gilts outperformed their European counterparts, with the 10yr yield falling -9.0bps. By contrast, there were smaller moves elsewhere, including for 10yr bunds (-4.1bps), OATs (-3.7bps) and BTPs (-5.1bps). The latest move also means the 10yr Italian-German spread edged down again to just 91.3bps, the tightest since February 2021.

European equities saw a mixed performance, with the STOXX 600 little changed (-0.02%). Defence stocks saw some pullback after their strong performance so far this year, with Rheinmetall (-5.80%), BAE Systems (-2.63%) and Thales (-3.63%) dragging European markets down. That left Germany’s DAX (-0.77%) and Italy’s FTSE MIB (-0.65%) underperforming for a second day running. On the other hand, France’s CAC (+0.17%) and UK’s FTSE 100 (+0.24%) posted modest gains, with the FTSE having been briefly on track for a record closing high intraday.

In Asia, the Hang Seng (+0.95%), the CSI (+0.82%), and the Shanghai Composite (+0.54%) are all making gains, supported by hopes for improved trade relations with the US even if S&P (-0.32%) and NASDAQ futures (-0.32%) seem a little disappointed we haven't got more information so far. Elsewhere, the KOSPI (+0.91%) is also on the rise, reaching a new 11-month high, while the Nikkei (+0.46%) is being pulled up by tech stocks. 

Early morning data showed that producer prices in Japan increased by +3.25% y/y in May, a deceleration from a revised +4.1% rise the previous month and falling short of the market consensus of +3.5%. This marks the 51st month of producer inflation, although it is the lowest annual rate observed since last September.

To the day ahead now, and as we previewed earlier, look out for the US May CPI release as well as the federal budget balance data. Also worth mentioning that the US 10-yr treasury auction will be held. We’ll also get the Canada April building permits. In terms of central bank speakers, we’ll hear the ECB’s Lane and Cipollone speak. Earnings include Oracle and Inditex

Tyler Durden Wed, 06/11/2025 - 08:25

Always Ready, Always There: Democrats Mobilize Against National Guard Deployment

Authored by Jonathan Turley,

Gov. Gavin Newsom was in his element this week. After scenes of burning cars and attacks on ICE personnel, Newsom declared that this was all “an illegal act, an immoral act, an unconstitutional act.” No, he was not speaking of the attacks on law enforcement or property. He was referring to President Donald Trump’s call to deploy the National Guard to protect federal officers.

Newsom is planning to challenge the deployment as cities like Glendale are cancelling contracts to house detainees and reaffirming that local police will not assist the federal government.

Trump has the authority under Section 12406 of Title 10 of the U.S. Code to deploy the National Guard if the president is “unable with the regular forces to execute the laws of the United States.”

The Administration is saying that that is precisely what is unfolding in California, where mobs attack vehicles and trap federal personnel.

Most critics are challenging the deployment on policy grounds, arguing that it is an unnecessary escalation. However, even critics like Berkeley Law Dean Erwin have admitted that “Unfortunately, President Trump likely has the legal authority to do this.”

There is a fair debate over whether this is needed at this time, but the President is allowed to reach a different conclusion. Trump wants the violence to end now as opposed to escalating as it did in the Rodney King riots or the later riots after the George Floyd killings, causing billions in property damage and many deaths.

Courts will be asked to halt the order because it did not technically go through Newsom to formally call out the National Guard.

Section 12406 grants Trump the authority to call out the Guard and employs a mandatory term for governors, who “shall” issue the President’s order. In the memo, Trump also instructed federal officials “to coordinate with the Governors of the States and the National Guard Bureau.”

Newsom is clearly refusing to issue the orders or coordinate the deployment.

Even if such challenges are successful, Trump can clearly flood the zone with federal authority. Indeed, the obstruction could escalate the matter further, prompting Trump to consider using the Insurrection Act, which would allow troops to participate directly in civilian law enforcement.

In 1958, President Eisenhower used the Insurrection Act to deploy troops to Arkansas to enforce the Supreme Court’s orders ending racial segregation in schools.

The Trump Administration has already claimed that these riots “constitute a form of rebellion against the authority of the Government of the United States.” In support of such a claim, the Administration could cite many of the Democratic leaders now denouncing the claim.

After January 6th, liberal politicians and professors insisted that the riot was an “insurrection” and, in claiming that Trump and dozens of Republicans could be removed from ballots under the 14th Amendment.

Liberal professors insisted that Trump’s use of the word “fight” and questioning the results of an election did qualify as an insurrection. They argued that you merely need to show “an assemblage of people” who are “resisting law” and “using force or intimidation” for “a public purpose.” The involvement of inciteful language from politicians only reinforced these claims. Sound familiar?

Democrats are using this order to deflect from their own escalation of the tensions for months. From Minnesota Gov. Tim Walz calling ICE officers “Gestapo” to others calling them “fascists” and “Nazis,” Democratic leaders have been ignoring objections that they are fueling the violent and criminal responses. It did not matter. It was viewed as good politics.

While Newsom and figures like Sen. Cory Booker (D., N.J.) have called these “peaceful” protests, rocks, and Molotov cocktails have been thrown at police as vehicles were torched. Police had to use tear gas, “flash bang” grenades, and rubber bullets to quell these “peaceful” protesters.

There appears little interest in deescalation on either side. For the Trump Administration, images of rioters riding in celebration around burning cars with Mexican flags are only likely to reinforce the support of the majority of Americans for the enforcement of immigration laws.

For Democrats, they have gone “all in” on opposing ICE and these enforcement operations despite support from roughly 30 percent of the public.

Some democrats are now playing directly to the mob. A Los Angeles City Council member, Eunisses Hernandez, reportedly urged anti-law enforcement protesters to “escalate” their tactics against ICE officers:  “They know how quickly we mobilize, that’s why they’re changing tactics. Because community defense works and our resistance has slowed them down before… and if they’re escalating their tactics then so are we. When they show up, we gotta show up even stronger.”

So, L.A. officials are maintaining the sanctuary status of the city, barring the cooperation of local police, and calling on citizens to escalate their resistance after a weekend of violent attacks. Others have posted the locations of ICE facilities to allow better tracking of operations while cities like Glendale are closing facilities.

In Washington, Jeffries has pledged to unmask the identities of individual ICE officers who have been covering their faces to protect themselves and their families from growing threats.

While Democrats have not succeeded in making a convincing political case for opposing immigration enforcement, they may be making a stronger case for federal deployment in increasingly hostile blue cities.

*  *  *

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

Tyler Durden Wed, 06/11/2025 - 08:05

Musk "Regrets" Some Posts About Trump, Signals Possible Reconciliation

Elon Musk publicly expressed regret over his recent X post attacks on President Donald Trump, admitting that his posts on X — particularly the one linking Trump to Jeffrey Epstein — "went too far."

"I regret some of my posts about President @realDonaldTrump last week. They went too far," Musk wrote in an early morning X post. 

I regret some of my posts about President @realDonaldTrump last week. They went too far.

— Elon Musk (@elonmusk) June 11, 2025

The fallout stemmed from last week's blowout after Musk opposed Trump's "Big Beautiful Bill," prompting Trump to hint at cutting off government contracts. In response, Musk unleashed a series of now-deleted X posts, including a claim that Trump was "in the Epstein files."

• Détente? Musk Hints At Path Forward On BBB; Trump Team Schedules Friday Call

• 'Very Disrespectful': Trump 'Assumes' Musk Relationship Is Over

To recap last week:

• Earlier in the week, Musk came out against the 'Big Beautiful Bill' - which raises the debt ceiling by $5 trillion, and either raises the deficit by $2.4 trillion, or lowers it by $1.4 trillion - depending on who you believe, and fails to address any of the waste, fraud and abuse found by DOGE. 

• Thursday morning, Trump was asked about Musk's opposition to the bill, telling reporters on Thursday that he's 'very disappointed in Elon,' and that Musk only opposes the bill because they eliminated electric vehicle tax credits from it.

• Trump then suggested he might pull government funding from Musk's companies such as SpaceX, which owns the only operational US spacecraft capable of transporting astronauts to and from the International Space Station.  "The easiest way to save money in our Budget, Billions and Billions of Dollars, is to terminate Elon's Governmental Subsidies and Contracts. I was always surprised that Biden didn't do it!" -President Donald Trump via Truth Social

• Musk went ballistic - announcing he would 'immediately' decommission the Dragon program (which he later walked back Thursday night), proposed a new political party (that's still his pinned post on X), endorsed another Trump impeachment, and said in a now-deleted post Trump is 'in the Epstein files,' which is why they haven't been released. 

Now that the dust has settled in the Trump-Musk feud, the president stated there would be consequences for Musk if he supports Democratic candidates opposing the tax and spending bill.

Musk stated in a CBS interview that BBB "undermines" the work of DOGE... The Trump administration has refuted this point.

On Monday, Trump said he had no plans to discontinue Starlink service at the White House but hinted he might have his Tesla Model S removed from the White House grounds.

"I may move the Tesla around a little bit, but I don't think we'll be doing that with Starlink. It's a good service," Trump told reporters. 

Trump also said that he would not have a problem if Musk called him: "We had a good relationship, and I just wish him well."

Musk's actions over the past several days suggest his anger has subsided and that he may be seeking to repair his relationship with the president.

As we noted last week... 

For better or worse, the BBB will pass. Instead of clashing over what is autopilot spending to satisfy legacy obligations, focus on how to generate the biggest GDP growth https://t.co/bw6DQ4pBVa

— zerohedge (@zerohedge) June 5, 2025

Odds are looking great on Polymarket...

Source: Polymarket https://t.co/UtjqsaIWrU

— zerohedge (@zerohedge) June 6, 2025

However, we do agree with Musk on codifying DOGE cuts—after all, it's a clear mandate from the American people for the president to rein in a bloated federal government long captured by deep-state swamp creatures.

Tyler Durden Wed, 06/11/2025 - 07:45

NIH Director Gives More Details On New Government Medical Journal

Authored by Zachary Stieber via The Epoch Times (emphasis ours),

The National Institutes of Health (NIH) will start a new journal that will help change the culture of science, the agency’s director said in a newly released interview.

NIH Director Jay Bhattacharya speaks alongside President Donald Trump during a press conference at the White House on May 12, 2025. Andrew Harnik/Getty Images

“The NIH can stand up and will stand up a journal where these replication results can be published and made searchable in an easy way,” Dr. Jay Bhattacharya said in a four-hour podcast interview with Andrew Huberman, a professor at the Stanford University School of Medicine, released on June 9.

Bhattacharya said he envisions people being able to see summaries of similar papers that looked at the same questions.

“A scientific journal put out by the NIH, a high-profile journal will then make publishing replication work a high-profile scientific, high-prestige scientific activity,” he added later.

Health Secretary Robert F. Kennedy Jr. said in May that federal scientists would likely be told to stop publishing in medical journals and, if that happened, the NIH would launch journals that would publish the scientists’ research.

Kennedy said that the existing journals have problems such as not publishing all of the data that underpins studies, while Bhattacharya said the journals will not publish replication research. Both officials have said they want the government to devote resources to replication, with Kennedy estimating that 20 percent of the NIH budget be designated for that purpose.

Replication is the process of taking a study, repeating it, and seeing if the results are the same.

While some scientists conduct meta-analyses, or studies that sum up existing literature on a topic—which could be considered a form of replication—“it’s really difficult to make a career out of doing replication work as a general matter,” Bhattacharya said in the podcast.

Scientists cannot at present earn large grants from the NIH for such work, which means the scientists cannot receive tenure at a top university, he said. That dissuades young scientists from focusing on replication work.

“We don’t reward it. The NIH doesn’t reward it,” Bhattacharya said. “That will change.”

The new journal will also publish negative results, or when scientists try to replicate a study and fail.

Emphasizing replication will make scientific literature more reliable, according to Bhattacharya, including for drug discovery and individual behavior, and will change the culture of science so that it “rewards truth ... rather than influence,” he added later.

Huberman, a neuroscientist, said that he welcomed the new journal and the focus on replication. “Everything you’re saying is very reassuring, and should be reassuring to people,” he said. “It’s music to my ears, frankly.”

The interview was released the same day some NIH employees signed a declaration that called cuts to NIH grants harmful and urged Bhattacharya to restore them. The NIH has terminated more than 2,000 grants totaling some $9.5 billion, as well as $2.6 billion in contracts, the employees said. The Trump administration is also proposing a smaller budget for the NIH in the next fiscal year.

Huberman noted that some grants that were labeled as diversity, equity, and inclusion (DEI) were cut and questioned Bhattacharya on whether the cuts included grants with the word transgenic. Bhattacharya said that there’s been an appeal process set up and researchers whose grants should not have been cut can file with the government. Some grants that were cut have been restored.

The NIH director said that it’s important to carry out research on vulnerable populations, and there are legitimate scientific questions where race or sex matters, such as breast cancer.

“The NIH absolutely supports that kind of research still despite all of the changes,” he said.

Bhattacharya also said that DEI is centered on the idea that structural racism is primarily responsible for the health outcomes of minorities and that he could not think of a scientific experiment that would in principle falsify that idea. Researchers who want to conduct studies based on the idea will not receive funding, he indicated.

“Let’s focus on the mission,” Bhattacharya said. “The mission is how do we advance, how do we make investments in research that advance the health and longevity of the American people ... I don’t believe there’s any place for this sort of race essentialism in it.”

Tyler Durden Wed, 06/11/2025 - 07:20

From the MBA: Mortgage Applications Increase in Latest MBA Weekly Survey

Mortgage applications increased 12.5 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending June 6, 2025. Last week’s results included an adjustment for the Memorial Day holiday.

The Market Composite Index, a measure of mortgage loan application volume, increased 12.5 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 23 percent compared with the previous week. The Refinance Index increased 16 percent from the previous week and was 28 percent higher than the same week one year ago. The seasonally adjusted Purchase Index increased 10 percent from one week earlier. The unadjusted Purchase Index increased 20 percent compared with the previous week and was 20 percent higher than the same week one year ago.

“Coming out of the Memorial Day holiday, mortgage applications increased to the highest level in over a month, driven by growth in both purchase and refinance applications. Treasury rates saw some movement during the week, which resulted in additional opportunities for borrowers,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. “The rate for 15-year fixed rate loans and FHA loans saw declines last week, while the 30-year fixed rate was largely unchanged. Purchase applications were 20 percent ahead of last year’s pace, continuing to show strength compared to a year ago. Despite ongoing uncertainty surrounding the economy, homebuyers seem to be taking advantage of loosening housing inventory in certain markets.”
...
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($806,500 or less) increased to 6.93 percent from 6.92 percent, with points decreasing to 0.64 from 0.66 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.
emphasis added

Click on graph for larger image.

The first graph shows the MBA mortgage purchase index.

According to the MBA, purchase activity is up 20% year-over-year unadjusted. 
Red is a four-week average (blue is weekly).  
Purchase application activity is still depressed, but above the lows of October 2023 and is 13% above the lowest levels during the housing bust.  

The second graph shows the refinance index since 1990.

The refinance index increased but remained very low.

US, China "Agree In Principle On Framework For Implementing Geneva Consensus"

After a full second day of discussion on the US-China trade deal, we finally have... something.

As Bloomberg reports, just before midnight London time, Commerce Secretary Howard Lutnick and China’s Vice Commerce Minister Li Chenggang both said they have agreed in principle on "a framework for implementing the Geneva consensus" combined with the outcome of the leaders June 5th call. 

“Once the presidents approve it, we will then seek to implement it,” Lutnick added.

If it sounds confusing, it is: the parties said they will implement a framework which was already agreed upon weeks ago... so what exactly were the talks for? Shouldn't there have been at least some token progress beyond what was already agreed upon, hence "consensus." 

Lutnick adding that “We absolutely expect that the topic of rare earth minerals and magnets… will be resolved in this framework implementation," does not make it any clearer if there is any actual deal on rare earths and/or chips... or just an agreement to continue talks?

Lutnick continued: “Also, there were a number of measures the US put on when those rare earths were not coming… You should expect those to come off — sort of, as President Trump said, in a balanced way. When they approve the licenses, then you should expect that our export implementation will come down as well” which suggests that nothing has been resolved at this stage, and instead we just wait for China to start exporting rare earth minerals?

And yes, for all the pomp and circumstance, it appears that all that took place in the past 48 hours was some meetings over coffee and KFC, because as Lutnick also said, the "framework is a first step, we had to get the negativity out."

Well, the negativity may be out, but no actual deals or agreements are in; instead agreement was reached to implement the implementation of an already agreed upon consensus. 

Finally, the Commerce secretary said that the idea behind the framework is to increase trade with China, which is great but wasn't the whole point of the negotiation to rebalance trade, not merely increase it? After all, it's very easy to receive even more Chinese exports and "increase trade."

Meanwhile, US Trade Representative Jamieson Greer said there were no other meetings scheduled, but added that the American and Chinese sides talk frequently and are able to do so whenever they need.

US-China trade talks wrapped up in London just before midnight.

“We have reached a framework to implement the Geneva consensus,” Commerce Secretary Howard Lutnick tells us.

“Once the presidents approve it, we will then seek to implement it.” pic.twitter.com/eMu3xRb4y6

— annmarie hordern (@annmarie) June 10, 2025

On the news, gold fell through 3320 but promptly rebounded as the market realized that what the announcement effectively boils down to is that the two sides have agreed to speak more. 

Spoos were trading at 6,040, before jerking higher, lower, and at last check trading unchanged from where they closed the regular session. 

In FX, cross-JPY buying morphed into broad USD selling with cross-JPY not really gaining traction; USDJPY is back under 145 after rising to a high of 145.10. 

Tyler Durden Wed, 06/11/2025 - 06:55

"Temporary Disruptions": Cyberattack On Whole Foods Supplier Sparks Store Shortages

North American grocery wholesaler United Natural Foods (UNFI), the primary distributor for Whole Foods Market, has been hit by a cyberattack that temporarily paralyzed U.S. operations. The company is working to restore systems by the weekend. The disruption has already led to reports of empty shelves at some Whole Foods locations due to delayed shipments.

Last Thursday, UNFI revealed in a filing with the U.S. Securities and Exchange Commission that it "activated its incident response plan and implemented containment measures, including proactively taking certain systems offline," after uncovering unauthorized network activity on its systems. 

"The incident has caused, and is expected to continue to cause, temporary disruptions to the Company's business operations," the Form 8-K continued, adding, "The Company is working actively to assess, mitigate, and remediate the incident with the assistance of third-party cybersecurity professionals and has notified law enforcement."

Fast forward to Monday, UNFI told customers in an email obtained by Bloomberg that it was "working toward the goal of returning to full operational capacity by Sunday or sooner," while apologizing for the disruption.

What's happened so far (via Bloomberg): 

• Operations Halted: UNFI shut down all business systems, including ordering and shipping, after detecting intruders in its network.

• Customer Impact: Forklift operators were sent home, and some resumed work using pen-and-paper systems. Clients like National Co+op Grocers made special requests to keep top-selling products moving.

• Response: UNFI is working with cybersecurity firm CrowdStrike and has reported the incident to the FBI. CEO Sandy Douglas said the situation is being handled by "a strong team of experts."

• No Payroll Disruptions Expected.

• Whole Foods: Confirmed supply disruptions; shelves in some Manhattan stores were visibly empty. 

UNFI CEO Sandy Douglas informed investors during a Tuesday earnings call that intruders had compromised its IT systems, and backend systems related to the supply chain were down. 

"We believe we are managing the incident capably with a very strong team of inside and outside professionals, including specialized experts," Douglas said, adding, "We will continue to keep our customers, suppliers and associates regularly updated on our progress and next steps."

Bloomberg reported that at least one Whole Foods location in Manhattan had partially empty shelves as a result of the disruption.

X users report disruptions...

At Whole Foods just now. Lotsa shelves empty

I asked what’s going on. One of the largest food distributors in the US got cyberattacked

That’s umm troubling the food supply can be disrupted this way pic.twitter.com/GG9UsftcI4

— Julie Chang (@JulieChangRE) June 10, 2025

Tech blog BleepingComputer noted about the increasing cyber threats targeting America's food supply chain:

UNFI is just the latest company in the food industry to have been breached in recent years. For instance, in March, ​Walmart-owned warehouse supermarket chain Sam's Club disclosed it was investigating claims of a Clop ransomware breach. Food giant JBS Foods, the world's largest beef producer, also paid an $11 million ransom in 2021 after a REvil ransomware attack forced it to shut down production at multiple sites worldwide.

The key takeaway: UNFI's cyberattack underscores the fragility of the U.S. just-in-time supply chain and its heavy reliance on vulnerable IT infrastructure. 

Our view—well known to readers—is clear: Take control of your food supply. Whether that means planting a garden, raising chickens, or building direct relationships with local ranchers and farmers, the message is the same: stop relying on globalist multinational corporations. 

Tyler Durden Wed, 06/11/2025 - 06:55

Energy Winners Should Be Chosen By Consumers, Not Government

Authored by Gary Abernathy via The Empowerment Alliance,

The “One Big Beautiful Bill” – designed to put most of President Trump’s campaign promises into action – squeaked through the House of Representatives on May 22 and was immediately greeted by expressions of horror from activists and corporations invested in so-called “alternative” energy.

The big business interests that drive the solar and wind boom have for years operated at a huge advantage. Most startups historically identify a need and create a quality product or service to meet the demand in the hope of becoming profitable within a few years. By contrast, the “renewables” industry has had the backing of the United States government in the form of tax incentives designed to virtually guarantee success. Even with so much government largesse, it’s astounding how many solar companies have been so badly managed that they have gone out of business.

Still, with Uncle Sam cheering them on, solar companies have converted more than a million acres of cropland and pastures to unsightly collections of solar panels. The rapid deployment often stirred controversy, pitted neighbor against neighbor, and sent state lawmakers scurrying to craft new and evolving rules and regulations.

Many people viewed the encroachment of solar as a blight on generational farmland, as ugly glass and metal panels replaced corn, soybean, wheat and other crops. Some landowners, though, eagerly grabbed the lifeline offered by solar companies in the form of per-acre sale or lease prices that were far above average market values, in many cases allowing them to escape mountains of farming debt.

As I wrote in a Washington Post column a few short years ago about a public hearing I attended on the topic of solar developments in southern Ohio, “The testimony was sometimes heart-wrenching. Some members of multigenerational farm families who have made deals with the solar companies spoke with tears in their eyes. Farming is in their blood, and in a perfect world they would continue the family tradition. But for them, it’s been a long time since the world was perfect.”

The kicker, of course, is that solar companies were able to offer such lucrative deals almost entirely because of subsidies and tax incentives offered by the Obama administration, curtailed somewhat by the first Trump administration, but reinvigorated on steroids by the Biden administration’s misleadingly named Inflation Reduction Act.

In a follow-up Post column in 2021, I noted that suspicions about the solar installations were increasing. “Questions are growing about neighboring property values and environmental issues,” I wrote. “What about responsible land practices such as plant maintenance, erosion protection and water runoff? When the solar fields are dismantled someday, will the soil be safe for reuse? Solar companies are providing answers, but trust is not always evident.”

For solar, the return of Trump and GOP congressional control means the gravy train might be rolling to a stop. The budget passed by the House ended many tax credits for companies installing rooftop solar panels, but, more importantly, the bill “also ends the investment and electricity production credits for clean energy facilities that begin construction 60 days after the legislation is enacted or enter service after Dec. 31, 2028. Those credits have played a key role in the rapid expansion of utility-scale solar projects in the U.S.,” as CNBC reported. Solar stocks immediately plunged.

But political considerations are always in play, and it’s telling that the House budget bill “left the manufacturing tax credit relatively unscathed.” That’s almost certainly because of the fact that domestic solar component manufacturing is well underway, including in many red states where members of Congress aren’t anxious to pull the plug on jobs that benefit local communities – even if they are based on the artificial tax subsidies from a government picking winners and losers.

When it comes to energy, the House bill will likely see some revisions in the Senate. Sen. Thom Tillis (R-N.C.) was probably smart, politically, when he said he would push for a slower phase-out of clean energy subsidies.

“For companies that have made major capital deployment decisions, we need to respect that or people are going to start thinking that the United States has massive changes in policy every two years in this space, and that will be devastating to the U.S.’s current position as the innovation leader,” Tillis said.

As Doc Holliday said in the movie “Tombstone,” that’s the damnable misery of it. Subsidies have backed the manufacture of solar initiatives in state after state, so while there are endless unknowns about the future, jobs are here now, at least in the short term. Abruptly shutting them down would give Democrats an election issue that a slow phaseout might help to avoid, or at least alleviate.

An “all-of-the-above” approach to energy is a popular political slogan, and indeed, alternatives will continue to be part of our energy mix. But recent blackouts, brownouts and general grid failures around the world due to an overreliance on solar demonstrate that the various resources that make up “all of the above” are not created equal. They do not generate equal energy, or give consumers the same dollar-for-dollar value.

The success of “alternatives” should be based on merit. Are they affordable? Are they effective? Are they reliable? Are they in demand? Our system of capitalism decides winners and losers. When government bureaucrats try to make those calls, taxpayers end up footing inflated bills for inferior products. That outcome should be an alternative no one supports.

Gary Abernathy is a longtime newspaper editor, reporter and columnist. He was a contributing columnist for the Washington Post from 2017-2023 and a frequent guest analyst across numerous media platforms. He is a contributing columnist for The Empowerment Alliance, which advocates for realistic approaches to energy consumption and environmental conservation. Abernathy’s “TEA Takes” column will be published every Wednesday and delivered to your inbox!

Tyler Durden Wed, 06/11/2025 - 06:30

Jefferies Goes On Hiring Binge As Outsourced Trading Booms

Jefferies Financial Group is ramping up its outsourced trading business by hiring 17 new traders, aiming to tap into the growing trend of asset managers looking to cut costs and expand their trading capabilities, according to Bloomberg.

The firm has already recruited nine traders and plans to hire eight more, extending its services to fixed-income products in addition to its existing equities desk.

This expansion comes as more asset managers consider outsourcing their trading operations. UBS’s exit from the outsourced trading business earlier this year has opened opportunities for competitors to gain market share. “A main theme has been the increase in the larger asset managers looking at this,” said Amy Thorne at Northern Trust. “This is not just a cost play.”

Outsourced trading allows money managers to execute trades during busy periods, access new markets, or even replace their entire trading divisions. Advocates say it provides better pricing and access to major counterparties, while critics worry it could erode market knowledge and relationships.

Jesse Forster at Crisil Coalition Greenwich said, “The buy-side’s doing more with less these days. So those hesitancies are wearing away, but there is still an element of: ‘Hey, I’m giving up a little bit of control. Is my boss going to like them better than me? Are they going to do too good of a job?’”

Bloomberg writes that to address potential conflicts, Jefferies stresses that its outsourced traders operate independently. “The information barriers we have in place ensure full segregation of order flow,” said Dean Gray, Jefferies’ head of international outsourced trading.

Other firms are also entering the market. Clear Street has hired six traders so far, with plans to grow to 20 within 18 months. Cantor Fitzgerald is expanding its offering to crypto, while Northern Trust and Marex Group are scaling up globally. “They don’t have to build their own infrastructure and capability, that’s what these firms are plugging into,” said Jack Seibald at Marex.

Data from a 2024 State Street survey shows nearly three-quarters of institutional investors plan to use outsourced trading for foreign exchange, and 67% plan to use it for derivatives.

Rebecca Crowe at Bank of New York Mellon said, “Eventually the drive for returns and client outcomes has to win.”

Tyler Durden Wed, 06/11/2025 - 05:45

Gun Used In Shooting Colombian Presidential Candidate Traced To Arizona

Authored by Yeny Sora Robles via The Epoch Times (emphasis ours),

The pistol used to shoot Colombian presidential candidate Sen. Miguel Uribe Turbay was purchased in the U.S. state of Arizona, the South American country’s top police officer said Monday.  

Forensic experts work at the crime scene where Senator Miguel Uribe Turbay was shot and wounded in the Modelia neighborhood in Bogota on June 7, 2025. Raul Arboleda/AFP via Getty Images

Speaking at a press event, Gen. Carlos Fernando Triana of the Colombian National Police said, “According to the verification carried out by the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives, within the framework of international cooperation, the firearm was purchased on August 6, 2020, in Arizona, United States, that is, it was purchased legally.”

Monday’s media event follows Uribe’s being shot twice at close range in the head and once in the leg during a pre-campaign event in the Modelia neighborhood of Bogotá on Saturday. Uribe, 39, who is of the conservative Centro Democrático party, remains hospitalized in critical condition.

El momento en que el disparan contra @MiguelUribeT, senador, precandidato presidencial y nieto del expresidente Julio César Turbay, durante un mitin en Bogotá https://t.co/dVWNPngstZ

— Pascal (@beltrandelrio) June 7, 2025

Triana further told the media that the Colombian Attorney General’s Office is investigating the shooting with the assistance of the country’s army and international cooperation to investigate how the weapon entered the country.

Luz Adriana Camargo Garzón, attorney general of Colombia, told the media event that investigators are also trying to identify whether the firearm used against Uribe has been involved in other similar attacks.

The alleged shooter, a 15-year-old boy from a poor neighborhood in Bogotá, was shot in the leg by police as he attempted to flee the scene and was captured. 

The motive behind the attack remains unclear.

Condition Is ‘Extremely Serious’

 The Santa Fe Foundation clinic, which is treating Uribe, issued a statement about his condition early on Monday.

“After completing the neurosurgical and left thigh procedures, he was transferred to intensive care for postoperative stabilization. His condition is extremely serious, and the prognosis is reserved,” the foundation stated on Monday.

His wife, Maria Claudia Tarazona, sent a message asking people to pray for him.

“Miguel is currently fighting for his life. Let us ask God to guide the hands of the doctors who are treating him. I ask everyone to join us in a chain of prayer for Miguel’s life. I put my faith in God,” she said in a post on X.

Uribe is the son of journalist Diana Turbay, who was kidnapped by Pablo Escobar’s Medellín cartel and killed during a botched rescue operation in 1991. He is also the grandson of former President Julio César Turbay, who served as the country’s leader from 1978 to 1982. Uribe was a councilman in Bogotá, secretary of government in Enrique Peñalosa’s mayoral office, and, since 2022, has held a seat in the Senate for the Democratic Center.

Tyler Durden Wed, 06/11/2025 - 05:00

UK Announces $19.3 Billion Funding For New Nuclear Power Project

Weeks after Germany decided to reverse course and 're-embrace' nuclear power following their supreme idiocy on the matter, the UK government announced on Tuesday that it would invest 14.2 billion pounds (US$19.3 billion) to build a new nuclear plant in the southeast of England.

Sizewell B nuclear power station, in Sizewell, England, on Sept. 1, 2022. Chris Radburn/AFP via Getty Images

The move was revealed by the Department for Energy Security and Net Zero as part of its broader spending review, which will lay out priorities for the next four years.

The new plant, named Sizewell C, will be located in Suffolk county, and is predicted to create around 10,000 jobs during construction, according to a government statement. Once operational, it will create enough electricity power roughly 6 million homes.

"We need new nuclear to deliver a golden age of clean energy abundance, because that is the only way to protect family finances, take back control of our energy, and tackle the climate crisis," said Energy Minister Ed Miliband. "This is the government’s clean energy mission in action, investing in lower bills and good jobs for energy security."

As the Epoch Times notes further, the UK has also been tapping up new investors to fund the construction of Sizewell C, but no new partners were mentioned in the announcement.

Neither the total cost of construction nor a date for expected completion has been announced.

Sizewell C was originally an EDF Energy project but is now majority-owned by the British government, with EDF Energy a minority shareholder.

EDF Energy is the British arm of Électricité de France (EDF), which is wholly owned by the French state.

The UK government’s stake was 83.8 percent and EDF’s stake was 16.2 percent at the end of December, EDF’s financial results showed in February.

Sizewell C would be just the second new nuclear plant built in Britain in more than 20 years, after another EDF project, Hinkley Point C, which was first announced in 2010.

Hinkley Point C, based in Somerset, southwest England, has been beleaguered by delays and budget overruns and is currently expected to come online in 2029.

Sizewell C would be the third power station built on the site after Sizewell A and Sizewell B, both of which are currently in the process of being decommissioned.

The Department for Energy Security and Net Zero also announced that it had picked Rolls-Royce SMR to build Britain’s first small modular reactors (SMRs).

About 2.5 billion pounds ($3.4 billion) of government funds will be dedicated to the SMR program over the next four years, in a bid to get one of Europe’s first small-scale nuclear industries going.

SMRs are usually around the size of two football fields and composed of parts that can be assembled in a factory, making them quicker and cheaper to build than conventional plants.

The moves by Britain come amid a renewed interest in nuclear power across Europe, sparked by spiraling energy costs due to the ongoing war between Russia and Ukraine, which is hampering the continent’s supply of natural gas.

European Commission President Ursula von der Leyen said in a keynote speech in August 2024 that the European Union needed more nuclear power.

Tyler Durden Wed, 06/11/2025 - 03:30