Another US Fighter Jet Destroyed In The Red Sea

Another $60 million US Navy fighter jet has been 'lost at sea' - this time during a crash landing as the aircraft was trying to land on the USS Harry S. Truman aircraft carrier.

This marks the second F/A-18 Super Hornet fighter jet which has been destroyed aboard the Truman in just over a week.

US Navy image

The first Super Hornet reportedly fell overboard late last month while the Truma took a hard turn amid inbound Houthi fire, in a strange incident which could just be a Pentagon cover story.

But as for the second incident, first reported Tuesday night (local US time), CNN writes that "It is not entirely clear what happened yet, as the investigation is ongoing, but two of the people said there was some kind of arrestment failure as the jet was trying to land on the carrier and the pilot and weapons systems officer had to eject."

"They were recovered by a rescue helicopter and are both alive, but they suffered minor injuries, one of the people said," the report continues.

Amid the apparent systems failure the aircraft went overboard. "The arrestment failed, causing the aircraft to go overboard. Both aviators safely ejected and were rescued by a helicopter assigned to Helicopter Sea Combat Squadron 11," a defense official described. "The aviators were evaluated by medical personnel and assessed to have minor injuries. No flight deck personnel were injured."

US Naval Institute News further details:

It’s unclear if the arresting wire that stops the aircraft during the carrier landing failed or if the hook on the fighter didn’t catch the wire. It’s also unclear whether the incident fouled the flight deck, interrupting flight operations. As of Tuesday evening, Truman was fully operational, the defense official said.

In total three jets have been recently lost in the Red Sea:

And in December, the missile cruiser USS Gettysburg, part of the Truman's strike group, shot down a Super Hornet in what the US military described as "an apparent case of friendly fire." Both aviators ejected safely.

The Houthis had since Red Sea hostilities were renewed in mid-March (in the wake of the Gaza ceasefire collapsing), sent drones and missiles against US warships off Yemen's coast, particularly the Truman carrier.

This week Israel has joined the US-led coalition's bombing campaign against the Houthis in Yemen. Israeli jets obliterated Sanaa International Airport, in an operation described as retaliation for the Sunday ballistic missile attack on Ben Gurion International Airport in Tel Aviv.

The timing of this second jet loss incident is interesting, given it was revealed the same day that President Donald Trump announced the US would stop strikes against the Houthis.

1/2
The USS Harry S. Truman appears to have performed an emergency turn on April 27th to evade a large-scale Yemeni missile and drone attack. The maneuver was so severe it could have caused the loss of the Super Hornet.

If true, this indicates that: pic.twitter.com/MMIDOpcZdw

— Alan (@Alan39982121) April 28, 2025

The Houthis have confirmed there will be a ceasefire in the Red Sea with the United States. The deal was mediated by Oman, and this looks like a 'mission accomplished' moment for Trump where he's ready to grasp onto a way out of the quagmire the US found itself in. Wisely, he is getting the US out, and Israel appears to be stepping up in terms of its own defense.

Mideast war correspondent Elijah Magnier has concluded, "The US intelligently stopped the bombing on Yemen due to the lack of objectives, the empty outcome and the high cost versus no gain." 

Tyler Durden Thu, 05/08/2025 - 04:15

Digital Euro: ECB Launches Charm Offensive

Submitted by Thomas Kolbe,

The European Central Bank (ECB) is pushing ahead with the “Digital Euro” project. On a new interaction platform, it is seeking dialogue with banks, startups, fintechs, and retailers. What is being sold as an open discourse is, in truth, calculated camouflage.

While the economic policy debate has shifted to the trade conflict with the US, things have gone quiet around the digital euro (CBDC). Yet, the ECB recently launched an online interaction platform where merchants and payment service providers can express their opinions about the new payment system. About 70 pre-selected market participants are to test the “ecosystem” of the digital euro in real-world applications and identify problems. The platform enables the testing of new payment services, such as conditional payments or the integration of digital wallets in post offices. Proponents of the project aim to modernize the payment system, granting access to the financial system even to those currently excluded due to their economic situation.

However, this mainly applies to people in poorer regions of the world-here, the benefit of a digital payment infrastructure, as offered by stablecoins (usually denominated in US dollars), is obvious. The question is whether we should consider something like this for the eurozone. Does the Chinese model of the digital yuan really align with our values, which should balance utility, efficiency, security, and individual sovereignty?

What is the Digital Euro?

The digital euro would be a small revolution, leading to a fully centralized form of central bank money. In tokenized form, it could be technically programmed and controlled-each monetary unit could be assigned conditions, each transaction centrally managed. The ECB would then be the sole issuer and operator of central wallets and the entire account infrastructure.

This raises questions about the future of commercial banks. At best, they could only function as distribution channels-their traditional role as intermediaries in payment transactions would effectively disappear. Lending would then fall into the hands of a largely autonomous central entity, which, needless to say, would be synchronized with the European Union’s objectives. According to its own statements, the ECB aims to develop the digital euro as a “secure, free-of-charge, and privacy-friendly means of payment” that, as is claimed in Frankfurt, is only intended to supplement the use of cash.

Such assurances from the ECB are nothing new, and so the launch of the interaction platform should be interpreted as a media charm offensive-or better: as a kind of transparency simulation that distracts from the real problems of this technology. Participants are pre-selected service providers whose expertise is indispensable for system design and procedural processes. Direct attacks on the monetary sovereignty of individuals or the separation of state and monetary system are not addressed on the platform. A public vote on the future of cash in the eurozone seems more unlikely than ever.

The Current State

Since November 2023, the European Central Bank has been in a two-year preparatory phase. By October or November of this year, technical foundations, data protection requirements, and initial tests are to be completed. The recently launched interaction platform, where citizens, merchants, and payment service providers can participate, is part of this process. Technically, the ECB is clearly oriented towards existing stablecoin models, where transactions are fast, secure, and free of charge. ECB President Christine Lagarde had already suggested in March that the digital euro could be introduced as early as October 2025.

But as so often with large-scale EU projects, this timeline seems overambitious and born out of haste. The challenge lies not only in technical complexity-billions of transactions are processed daily via existing systems-but also in the sensitive interplay between the central bank, commercial banks, retailers, and consumers. The overhaul is like trying to move a monolith by hand: massive, sluggish, risky.

Furthermore, the security architecture of the digital euro remains largely in the dark. Given the real threat of targeted attacks from the international hacker scene, this reticence is remarkable-real dangers, as well as fundamental systemic criticism, are ignored.

The Leviathan-Thoughts on the Background of CBDC

The digital euro is not a neutral means of payment. It is a tool of power. The ECB is no longer positioning itself merely as a central bank but as the central technological infrastructure operator for payments in Europe. For the first time, it would have direct access to the entire monetary infrastructure of the eurozone-from payment flows to account management and even to the potential control of individual monetary units. The digital euro would give the ECB not only more insight into financial activity but also far-reaching intervention and control possibilities over the financial system-with significant political and social implications.

As a largely autonomous entity, the European Central Bank has evaded democratic control since its inception. Even during the last sovereign debt crisis 15 years ago, it managed to massively expand its real-world powers by buying up government bonds on a large scale and thus effectively beginning to monetize government debt. The planned introduction of a digital euro would further cement this immediate power-with potentially profound consequences for the balance between monetary sovereignty, fiscal responsibility, and democratic legitimacy.

Why the Rush?

Against this backdrop, a central question arises: Why is the ECB pushing for the introduction of a digital euro right now? The eurozone has been stuck in a structural economic and debt crisis for some time. Germany’s economy, traditionally the EU’s anchor of stability, is in its third year of a persistent recession. At the same time, many southern European countries have long since lost control over their national debt.

Amid this fragile situation, the ECB is increasing the pressure to implement digital central bank money-a step that is not only technocratically motivated but also aims to deeply reshape the architecture of the European financial system. France, with a national debt of 120%, and Italy, with 140%, will not be able to escape the debt spiral without massive monetary interventions-the ECB is firmly planned as the “lender of last resort” in the capitals of the eurozone. Massive credit injections and yield curve control seem to be the only way out of this dilemma. A sovereign default is not an option, as it would mean the end of the entire eurozone.

The Greek crisis is a reminder. However, the mountain of debt in the eurozone has continued to rise to 95%. Bringing it under control in the event of a debt crisis would be much more complicated. The necessary expansion of the credit base to rescue over-indebted states would be so massive that investors would question the stability of the currency. In such a scenario, the digital euro would not be a neutral means of payment but a tool for market closure-with programmable transactions that could nip any capital flight in the bud.

The digital euro thus mutates into an electronic bolt: the ECB raises the drawbridges of the EU fortress to prevent a flight from the system and thus the collapse of the euro.

Consequences and Outlook

What is obviously underestimated in the Frankfurt ECB Tower is the speed at which mobile capital moves today. It is to be expected that the already beginning capital flight from the eurozone will accelerate dramatically-precisely at the moment when rumors spread in European financial centers that the ECB wants to close the gates with the help of a digital euro.

Given the political movement in the United States against CBDCs and the clear rejection of this technology by the Federal Reserve, there is a danger that Europe, especially the eurozone, will isolate itself through the ECB’s initiative. Unlike the United States, which is currently pursuing deregulation and free-market policies, the euro CBDC appears as a digital panopticon: a central authority that monitors everything, controls everything, and reserves the right to intervene at its discretion. An opaque monster that directly threatens the sovereignty of the citizen.

With the digital euro, the ECB is not only planning the creation of a new means of payment. We are witnessing an attempt to radically change the way we handle money. 

What is being touted as a convenient, cashless payment option could turn out to be a Trojan horse for deep control of the financial system and the individual citizen. Unfortunately, the new interaction platform does not offer the opportunity to discuss these thoughts in detail.

Tyler Durden Thu, 05/08/2025 - 03:30

Von der Leyen Calls On EU To Hasten Ukrainian Entry As Blow To Putin

European Commission President Ursula von der Leyen is calling for the fast-tracking of EU accession talks for Ukraine, though we can imagine quietly behind the scenes other European officials aren't looking forward to the day that one of the world's most corrupt countries joins the bloc.

Speaking at a Europe Day event on Wednesday, von der Leyen urged for the process to start this year, in 2025, in order to "help Ukraine stand strong" and "defy Putin’s intimidations" - according to a readout.

"Today, I would like to focus on how we can do so, and on three priorities for our action," she said. "First, support Ukraine’s defense. Second, complete the phase-out of Russian fossil fuels. And third, accelerate Ukraine’s accession path to our Union."

She then emphasized that Brussels is "working hard with Ukraine to open the first cluster of accession talks, and to open all clusters in 2025."

The Kremlin last year said that it is open to Ukraine joining the EU, but stressed that the question of joining NATO remains an impossibility, and that Moscow will never allow it.

Still, at around same time the EU question was raised, Foreign Minister Sergey Lavrov had asserted that the EU itself, which is supposed to be a purely economic and politically-linked bloc, is "becoming militarized at a record pace."

Meanwhile, the European Union has of late seemed much more open about its willingness to sabotage Trump efforts toward achieving peace in Ukraine. 

The EU's top diplomat Kaja Kallas last week told the Financial Times in an interview that the bloc will not recognize Russia's annexation of Crimea under any circumstances. Really, this should be the most obvious and 'easiest' concession to make, but alas Brussels is saying no!

The White House is seeking to pressure the Zelensky government to get to the negotiating table fast, and the quickest and easiest concession would be expected to center on letting go of Crimea, which Moscow declared part of the Russian Federation after a 2014 popular referendum.

"I can’t see that we are accepting these kind of things. But we can’t speak for America, of course, and what they will do," Kallas had said. "On the European side, we have said this over and over again... Crimea is Ukraine."

"There are tools in the Americans’ hands that they can use to put the pressure on Russia to really stop this war," Kallas continued. "President Trump has said that he wants the killing to stop. He should put the pressure on the one who is doing the killing."

This has basically been the Ukrainian government's position all along as well. For this reason, she said Brussels and other European capitals are still focused on "working with the Americans and trying to convince them why the outcome of this war is also in their interest, that Russia doesn’t really get everything that it wants." But again, Crimea should be the easiest issue.

Tyler Durden Thu, 05/08/2025 - 02:45

Germany's New Chancellor Slams US Meddling, Defends Crackdown On 'Far-Right'

Via Remix News,

After the Trump administration condemned Germany’s slide into tyranny and anti-democratic actions against the Alternative for Germany (AfD), the new German government under Friedrich Merz is now openly criticizing the U.S. for pointing out these tyrannical methods. 

Realizing that there is serious potential for conflict between Washington and Berlin, Merz says he will speak to the U.S. government.

Merz criticized the voices from parts of the U.S. government that supported the AfD during the federal election campaign and recently criticized the party’s classification as right-wing extremist by the Federal Office for the Protection of the Constitution.

The current main point of contention is the powerful domestic spy agency, the Federal Office for the Protection of the Constitution (BfV) and its decision to classify the Alternative for Germany (AfD) as a “confirmed right-wing extremist” party. Merz said the U.S.’s comments were “absurd observations of the Federal Republic of Germany,” and that “I’ve actually always had the feeling that America is able to distinguish very clearly between extremist parties and parties of the political center.”

The BfV operates with modern Stasi-like powers but wields a far greater technological arsenal. Under the new designation, the BfV can now legally surveil all AfD members without a warrant, including reading their emails and chats. It can also flood the AfD party with informants and take action against civil servants who are members of the party.

The fact that the AfD is the largest opposition party in the country and that there are now efforts underway to ban the party is causing serious alarm in the United States, which is calling the German government’s path forward authoritarian and undemocratic. Most notably, Secretary of State Marco Rubio called it “tyranny in disguise.”

Germany just gave its spy agency new powers to surveil the opposition. That’s not democracy—it’s tyranny in disguise.

What is truly extremist is not the popular AfD—which took second in the recent election—but rather the establishment’s deadly open border immigration policies…

— Secretary Marco Rubio (@SecRubio) May 2, 2025

Perhaps the best analogy would be if the U.S. government suddenly declared the Democratic Party a “confirmed extremist” party because it promotes open borders, and under Biden, effectively brought millions of more illegal migrants into the country. Then, a Republican-appointed spy chief surveilled all members of the Democratic Party without a warrant, was able to send informants into the party, and could fire teachers, judges, and police officers who were members of the party.

If such a scenario occurred, the liberal EU and mainstream press would be the first ones to scream about “tyranny” and a new “authoritarian” reality in the United States, with Germany at the top of the list.

Merz, on the other hand, seems dismissive of the U.S. critiques. He said he will speak with Donald Trump and establish contacts with the White House, but Merz may be in store for a chilly reception.

In regard to Trump, Merz said: “We don’t know each other personally yet.”

However, he said at the end of June, he will meet with Trump at the NATO summit in The Hague and “perhaps even sooner.” He said they “talk openly with each other.”

“As Europeans, we have something to offer; together we are even bigger than the United States of America,” said Merz.

“We can do something, we are united, largely anyway. That will be my message to the American government.”

“I did not interfere in the American election campaign and did not take sides unilaterally for one party or the other,” said Merz.

However, democratic backsliding in Germany is a grave concern for the entire world, and there are fears that a ban of the AfD could come sooner than later. In such a scenario, millions of voters would be denied their democratic rights.

Not everyone in the CDU, or its sister party, the Christian Socialist (CSU), is on the same page though.

CSU leader Markus Söder is warning against an AfD ban, saying it should only serve as a “wake-up call” to change government policies. He said he is not sure the BfV report is sufficient for a ban.

Read more here...

Tyler Durden Thu, 05/08/2025 - 02:00

How An India-Pakistan War Could Derail Central Asia's Future

Authored by James Durso via OilPrice.com,

• A war between India and Pakistan would significantly destabilize Central Asia, disrupting trade routes, delaying infrastructure projects, and increasing regional militancy.

• China, Russia, and the U.S. may intensify involvement in Central Asia, leveraging the conflict to protect or expand their influence.

• Potential nuclear fallout, refugee flows, and the breakdown of regional cooperation could severely impact Central Asia’s economic development, security, and food systems.

If India and Pakistan spiral into war, there will be consequences for Central Asia.

A war between Pakistan and India would likely have significant ripple effects on Central Asia, given the region's proximity to Afghanistan and flourishing economic ties across the region. The conflict could disrupt trade and energy routes, increase militancy, and draw in major powers like China, Russia, and the U.S., potentially straining Central Asian stability.

Intervention by external powers: The Central Asian republics (Kazakhstan, Uzbekistan, Turkmenistan, the Kyrgyz Republic, and Tajikistan) are already arenas for competition among outside powers. A Pakistan-India conflict could draw these powers into the region more aggressively to secure their interests, though Russia is busy in Ukraine, Turkey is busy in Syria, and U.S. forces are fighting in the Middle East, and Washington is ready to confront China.

China is an ally of Pakistan and sponsor of the $65 billion China-Pakistan Economic Corridor (CPEC). China might deepen its presence in Central Asia to secure trade routes and counterbalance India’s regional influence. This could accelerate Chinese investments in infrastructure and energy projects that will increase trade with the region that totaled $89 billion in 2023, up 27% from 2022, $60 billion of which was Chinese exports.

And China may make further inroads into the Central Asia arms market given Moscow’s need to dedicate all its resources to the Russia-NATO war in Ukraine. This will allow China to broaden its engagement beyond infrastructure projects into the security realm that, up to now, has been limited to anti-terrorism training and intelligence sharing in Tajikistan.

Russia is an ally of India, a buyer of Russian arms, having purchased $60 billion of Russian arms, 65 percent of its total weapons imports, over the past twenty years With its historical ties to Central Asia and shared membership in the Collective Security Treaty Organization (CSTO), Russia might leverage a conflict to reinforce the region’s border security, and increase intelligence sharing and security forces training.

And just in time, Russia has declared it will help the Taliban government fight the Afghan branch of the Islamic State, the Islamic State – Khorasan Province (IS-K).

The United States could focus on Central Asia to counter China and Russia, potentially increasing military or economic aid to Uzbekistan or Kazakhstan, the major economies in the region. Unlike the leaders of Russia or China, no American president has ever visited Central Asia but President Donald Trump could signal increased U.S. attention by visiting the region.  

Afghanistan as a flashpoint. Afghanistan, bordering both Pakistan and Central Asia, would likely become a hotspot. The Afghan Taliban’s support for the Pakistani Taliban, the Tehreek-e-Taliban-e-Pakistan (TTP) could further destabilize Pakistan, presenting Islamabad with the prospect of a two-front war, though recent visits by Pakistan’s diplomats, and military and security officials seeking a “diplomat reboot” may be just in time to stanch action by the TTP.

Instability would come to Central Asia via Afghanistan in the form of refugees and energized militants, and economic stagnation in the delay of development projects like the Trans-Afghan railway, the Turkmenistan–Afghanistan–Pakistan–India (TAPI) natural gas pipeline, and the CASA-1000 renewable energy infrastructure construction project.

General disorder may spill insecurity into Tajikistan and Uzbekistan, where cross-border militancy (e.g., the Islamic Movement of Uzbekistan (IMU), which has pledged allegiance to al-Qaeda, and IS-K could surge.

And the instability will cause a slowdown in foreign direct investment that has steadily climbed as has foreign trade in goods and accession to bilateral investment treaties. The region’s economy suffered “lost decades” between the start of the Afghan civil war in 1992 and the end of the NATO occupation of Afghanistan in 2021 and has been making steady progress in connecting to the wider world economy; Turkmenistan and Uzbekistan are completing the World Trade Organization (WTO) accession process, and Kazakhstan and Tajikistan are WTO members.

And just in time for a war, the World Bank is predicting economic slowdown for Central Asia:   Kyrgyzstan and Tajikistan will suffer pronounced declines, Kazakhstan’s decline will be less pronounced, and Uzbekistan’s growth rate will remain steady at 5.9%.

The U.S. may try to leverage disorder on Afghanistan’s border with Pakistan to pressure the Kabul government, but that risks empowering Al-Qaeda, IS-K, the hardline Taliban faction in Kandahar, or some combination of the three. Disorder in Pakistan’s Balochistan province, the poorest place in Pakistan, may energize the local separatists and draw in bordering Iran which faces a Baloch insurgence on its side of the border.

India’s Central Asian Ambitions. India’s efforts to access Central Asian and Afghan resources, via Iran’s Chabahar port, could be disrupted, forcing India to seek alternative routes or deepen ties with Russia and Iran, affecting regional alignments, and angering the U.S. which is trying to isolate Moscow and Tehran.

India imports uranium for its nuclear power program from Kazakhstan and Uzbekistan and an uninterrupted supply by the republics will be a sign to India they value their relationship with Delhi.  

Trade Route Disruptions: Central Asia relies on connectivity projects like CPEC and the International North-South Transport Corridor (INSTC). A war could disrupt CPEC which links China’s Xinjiang province to Pakistan’s Gwadar port and passes through contested areas like Kashmir. India’s trade routes to Central Asia via Iran and Afghanistan could be jeopardized if conflict escalates or Afghanistan becomes unstable, though if Indian merchantmen are unmolested by Pakistan the impact may be minimized and they will be able to safely dock at Iranian ports.

Tightened border controls will hurt regional trade that was boosted by eased border controls that teased the possibility of a unified regional market, following the resolution of many territorial disputes, a process that began in earnest after the 2016 election of Uzbekistan’s president, Shavkat Mirziyoyev.

The Central Asia republics trade with India and Pakistan and will be reluctant to be drawn into one side’s economic warfare on the other. Kazakhstan, Uzbekistan, and Turkmenistan, the three largest economies in the region, all import packaged medicaments and vaccines from India and mostly food products from Pakistan, and may find it easier to replace the lower-valued agriculture products than disrupting their medical supply chain.

Pakistan and Kazakhstan recently inked a transit trade agreement that would see goods shipped from Central Asia through the Pakistani ports of Karachi, Bin Qasim, and Gwadar, and the start of direct flights between the countries. An India-Pakistan war will bring in the insurance companies who may cancel coverage to aircraft, trucks, and their cargoes, delaying the benefits of the deal.

Spillover of Militancy: A Pakistan-India war, especially if centered on Kashmir, could embolden extremist groups like Jaish-e-Mohammed or Lashkar-e-Taiba, which have historical ties to Afghan and Pakistani militants. 

This could inspire increased terrorist activity in Tajikistan and Uzbekistan, where groups like the IMU and IS-K could exploit regional conflict for recruitment and radicalization.

Nuclear Risks: Both nations possess nuclear arsenals, less than 200 weapons each. Even a limited nuclear exchange could cause dire environmental and climatic effects, disrupting Central Asian agriculture and food security, and pretty much eliminating agriculture exports as customers fret about “contamination,” despite the prevailing westerly winds. In Uzbekistan, agriculture contributes about 25% to the Gross Domestic Product and employs about a quarter of the workforce, so the economic (and political) impact would be profound.

Conflict in Pakistan or Afghanistan could drive refugees into Central Asia, particularly Tajikistan, straining resources and sparking ethnic tensions, and destabilizing resource-strapped governments.

India and Pakistan are members of the Shanghai Cooperation Organization (SCO), as are several Central Asian states, and China and Russia. A war could paralyze SCO initiatives, hindering regional security and economic cooperation. Tensions might also exacerbate India-China rivalries within the SCO, affecting Central Asia’s balancing act.

Specific Impacts on Central Asian States

Tajikistan shares a porous border with Afghanistan, making it vulnerable to militancy and refugee inflows. India’s military training programs with Tajikistan could be disrupted, and its newly-refurbished (by India) Ayni Airbase base may worry Pakistan.) As a regional leader, Uzbekistan might seek to strengthen ties with Russia and China to counter instability, however, its trade with South Asia could suffer. Neutral but energy-dependent, Turkmenistan could benefit from Chinese energy demand. As the major Central Asia economy, Kazakhstan might leverage its SCO and Eurasian Economic Union ties to mitigate disruptions but could face energy market volatility. Kyrgyzstan is economically fragile and be hit hard by trade disruptions increasing reliance on China or Russia.

Long-Term Implications

Regional Polarization: Central Asia could become more divided, with some states aligning with China (e.g., Turkmenistan) and others with Russia or the West (e.g., Kazakhstan, Uzbekistan), hindering regional unity, which may be in the interests of Washington, Beijing, Brussels, or Moscow.

Securitization: Fear of spillover could lead Central Asian states to increase security spending, diverting resources from economic development. More than half of Central Asia’s population is under 30 years of age and they have high expectations that governments are trying to satisfy by increasing educational and economic opportunity, and diversifying the economies away from agriculture and natural resource extraction, and towards technology, services, and tourism. And more security may come at the expense of civil rights.

Environmental Fallout: A nuclear conflict, even limited, could cause global climate disruptions, devastating Central Asia’s agriculture-dependent economies.

Conclusion

India has been active in Central Asia with its Connect Central Asia Policy, which aims to enhance trade, connectivity, and diplomatic engagement, and hinges on India’s development of Chabahar port in Iran, though the Trump administration rescinded the sanctions waiver on Chabahar. Washington’s fixation on Iran, specifically ruining its economy to press it for a favorable nuclear deal, may see India and Central Asia as collateral damage.

The republics import higher value goods from India (Packaged Medicaments) than they do from Pakistan (food products), and sell uranium – a strategic good – to India. India has a larger market than Pakistan and is a provider of technology products that Pakistan cannot match, and the republics’ future is with India, though they have no reason to antagonize Islamabad.

A Pakistan-India war would destabilize Central Asia by disrupting trade, fueling militancy, and intensifying great power rivalries. The region’s proximity to Afghanistan and reliance on connectivity projects make it particularly vulnerable. Central Asian states would face economic strain, security threats, and pressure to align with external powers, potentially fracturing regional cooperation. The nuclear risk underscores the catastrophic potential, with global climatic effects threatening Central Asia’s food security and economic stability. To mitigate these risks, Central Asian states might pursue neutrality, strengthen SCO ties, or seek mediation roles, but their limited clout may constrain effective responses.

Tyler Durden Wed, 05/07/2025 - 23:25

World's Largest Jewelry Brand Says Reshoring US Production "Simply Won't Work" 

Pandora Jewelry CEO Alexander Lacik spoke with Bloomberg TV's Anna Edwards on Wednesday about the potential for re-shoring production from Asia to the U.S. in response to President Trump's trade war. But the head of the world's largest jewelry company offered a blunt assessment: Pandora has no plans to overhaul its supply chain. 

Edwards asked Lacik: "So, a third of Pandora's business comes from the U.S., which means you're quite exposed to tariffs since you produce 95% of your jewelry in Thailand. You have plans to open a site in Vietnam, but there's a 46% tariff on products coming from Vietnam into the U.S. So, Alexander, does this have you looking at other production locations?"

Lacik responded, "If I wanted to build another plant somewhere, it would take roughly three years to get something up and running. You would actually need to go to places where there is a tradition of crafting. I have almost 15,000 craftspeople working for Pandora in Thailand at the moment. Those craftspeople have many years of tradition in doing crafted jewelry."

Here's one of Pandora's Thailand factories...

"So it's not so easy, just - it's not like moving a machine from one place to another. So, first of all, finding the skilled people who can do the jewelry for us would be the first protocol," Lacik said, 

He was very blunt: "So if you look at labor costs, if I were to consider going to the US, in terms of economics, that equation wouldn't work for us." 

The takeaway from the world's largest jewelry company—which designs, manufactures, and markets hand-finished pieces from Southeast Asia—is that it has no plans to abandon its ultra-low-cost manufacturing hubs. That means Pandora will either absorb the tariffs or pass the added costs on to consumers.

"It's not like moving a machine from one place to another"

Pandora CEO Alexander Lacik tells @annaedwardsnews the jewelry company is not looking to build production facilities in the US to mitigate its exposure to Trump's tariffs https://t.co/avWsTlJs4V pic.twitter.com/K1PtRDqsdA

— Bloomberg (@business) May 7, 2025

For what it's worth, one could argue that Americans can live without Pandora jewelry. Instead, consider buying gold and silver coins or bars—real stores of value.

Tyler Durden Wed, 05/07/2025 - 23:00

FBI Mishandled Investigating Congressional Baseball Shooting, House Committee Finds

Authored by Jackson Richman via The Epoch Times,

A House Intelligence Committee report released on May 6 says that the FBI mishandled its investigation of the 2017 shooting at a GOP practice one day before the annual Congressional Baseball Game—including not calling the incident domestic terrorism and not interviewing key figures.

The committee’s chairman, Rick Crawford (R-Ark.), accused the FBI of holding up the report.

“There’s no reasonable or acceptable explanation for why the FBI stonewalled the committee for so long,” he said during a press conference.

“In fact, it’s taken so long to get this case file, many of those members at the field on that fateful day are no longer in Congress.”

The report found that the FBI did not thoroughly interview victims and eyewitnesses to the shooting, where House Majority Leader Steve Scalise (R-La.) and four others were shot.

Scalise was shot in the hip and seriously wounded, requiring several surgeries and a lengthy recovery.

Former Rep. Mo Brooks (R-Ala.) was not interviewed despite being at the scene during the shooting.

The shooter, James Hodgkinson, was shot and killed by Capitol Police, who were already on the scene due to Scalise’s presence as he was a member of House GOP leadership and therefore afforded a security detail.

The report also found that the bureau did not come up with a timeline of events surrounding the shooting.

The report attempted to dispute the FBI’s claim that the shooting was not connected to domestic terrorism.

In a press release following the shooting, the FBI said it “does not believe there is a nexus to terrorism.”

The Intelligence Committee report criticized the press release, saying it failed to include information that would have contradicted what the report called the FBI’s “suicide by cop” narrative.

“To commit suicide by cop, the perpetrator needs to demonstrate hostile intent in the presence of police. In this case, there were no observable police officers present,” the report said, noting that the officers were dressed in plain clothes.

The report said that the FBI’s “conclusions failed to follow the facts, as it reached an unsupported conclusion without completing even the most basic of investigative activities.”

The report said that while the FBI cited that Hodgkinson’s brother believed that the aim of the shooting was for Hodgkinson to die by suicide by cop, this was merely the brother’s opinion and not based on any communications.

Scalise was made aware of the report by the committee, according to Crawford, who declined to elaborate as he did not want to speak on Scalise’s behalf.

In a statement to The Epoch Times, the FBI said it “is committed to working quickly and transparently with Capitol Hill to ensure the American people receive the full truth they deserve.”

“We have diligently delivered all requested documents and will continue to cooperate fully with Congress to uphold transparency and accountability,” the bureau said.

Tyler Durden Wed, 05/07/2025 - 22:35

California Gas Prices Could Rise 75% By End Of 2026: USC Analysis

Authored by Brad Jones via The Epoch Times,

California gas prices could skyrocket by as much as 75 percent by the end of 2026 with the expected shutdown of oil refineries in the state, according to an analysis released May 5 by a researcher at the University of Southern California (USC).

Regular gasoline prices could rise from an average of $4.82 in April 2025 to as high as $8.44 a gallon by the end of next year, said the report, authored by Professor Michael Mische at the Marshall School of Business.

Two Phillips 66 refineries in Los Angeles—about 8 percent of the state’s oil refining capacity—are slated to close by the end of this year. Valero Energy Corp. also announced last month it will shut down or restructure its Benicia refinery in the San Francisco Bay area—which accounts for about 9 percent of refining capacity—by April 2026, increasing concerns over gas prices and supply.

The USC analysis states that based on current demand, consumption, state regulations, and other factors, the refinery closures could result in a potential 21 percent drop in refining capacity from 2023 to April 2026.

This could create a gasoline deficit potentially ranging from 6.6 million to 13.1 million gallons a day, said Mische.

“Reductions in fuel supplies of this magnitude will resonate throughout multiple supply chains affecting production, costs, and prices across many industries such as air travel, food delivery, agricultural production, manufacturing, electrical power generation, distribution, groceries, and healthcare,” he wrote.

Industry experts have also warned that gas prices will spike dramatically when the refineries close.

Phillips 66 said it was shutting down its LA refinery because of the uncertainty surrounding its long-term sustainability, and because of “market dynamics.”

The state of California is currently suing major oil companies over alleged deception regarding the risks of climate change and fossil fuel combustion.

Governor Urges Energy Commission to Take Action

In an April 21 letter, Gov. Gavin Newsom directed California Energy Commission (CEC) vice chair Siva Gunda to “redouble” the state’s efforts to work closely with oil companies to ensure a “safe, affordable, and reliable supply of transportation fuels, and that that refiners continue to see the value in serving the California market, even as demand for fossil fuels continues its gradual decline over the coming decades.”

Newsom directed Gunda “to reinforce” the state’s “openness to a collaborative relationship and our firm belief that Californians can be protected from price spikes and refiners can profitably operate in California—a market where demand for gasoline will still exist for years to come.”

The governor also referred to the CEC’s Transportation Fuels Assessment report, which lists a state takeover of oil refineries in California as one of several options, and directed Gunda to recommend “any changes in the state’s approach that are needed” by July 1.

Republican state Sen. Brian Jones from San Diego, the Senate minority leader, issued a May 6 statement citing the USC study and calling the refinery closures “a looming energy and economic crisis.”

“If the Governor doesn’t act now, Californians will be blindsided by sticker shock at the pump and skyrocketing prices on everyday goods,” Jones said.

In a May 6 letter to Newsom, Jones called for urgent measures to prevent further refinery closures and support long-term energy stability, such as investment tax credits or other relief from taxes and regulations.

Meanwhile, Republican state Sen. Shannon Grove from Bakersfield urged the governor to increase new drilling permits to support in-state oil production instead of relying on “expensive foreign imports, often from hostile nations,” she told The Epoch Times.

New permits have plummeted 97 percent over the last five years, according to data from the California Department of Conservation. New drilling permits in the state dropped from 2,676 in 2019 to 86 in 2024.

“This is catastrophic for every Californian at the gas pump,” Grove said in an April 16 social media post.

“Refineries are shutting down or barely hanging on because they can’t get the oil they need to produce the gas used every day by California families.”

‘Controlling the Damage’

Mike Umbro, founder and CEO of Californians for Energy and Science—a nonprofit advocate for energy economics and environment—and a developer of an oil field project west of Bakersfield, told The Epoch Times that Newsom’s letter appears to be conducting damage control with oil companies.

“He is trying to task Siva Gunda with controlling the damage,” Umbro said.

Umbro urged the governor to take a more direct and deliberate approach by signing an executive order declaring an energy crisis, issuing permits to drill, and allowing refineries to produce gasoline.

He applauded the USC study, saying it and other independent studies are what’s needed to fully evaluate the oil-and-gas supply and ensure there is no shortage of affordable gas at the pumps for consumers.

Daniel Villaseñor, a spokesman for the governor’s office, told The Epoch Times in response to questions that Newsom’s letter to Gunda “speaks for itself.”

Sandy Louey, a CEC spokeswoman, told The Epoch Times in an email that the agency is “committed to working with stakeholders to explore options to ensure an affordable, reliable, and safe transportation fuel supply.”

Louey said the concept of a state-owned refinery is “just one in a list of many potential options for the state to consider” that the CEC proposed as possible solutions to mitigate gas price spikes in a report released last August.

In the report, the CEC identified that a state-owned refinery may provide relief to consumers but recognized many challenges to overcome, including high costs, the expertise necessary to manage refinery operations, and how the refinery would fit into the state’s transition away from petroleum fuels, she said in the email.

The California Air Resources Board is also required to develop and submit a Transportation Fuels Transition Plan to be released by the end of the year, Louey said.

According to a statement by Valero, a fire broke out at its Benicia refinery on May 5 but was extinguished within hours.

No injuries were reported, and the cause of the fire is under investigation, said the oil company. Valero did not say whether the fire would significantly disrupt production at the refinery.

Tyler Durden Wed, 05/07/2025 - 21:45

Nina Kienle and Adria Calatayud of the Wall Street Journal report Veolia to Buy CDPQ's Stake in Water Technologies and Solutions for $1.75 Billion:

Veolia said it agreed to buy Caisse de Depot et Placement du Quebec's minority stake in its Water Technologies and Solutions subsidiary for $1.75 billion, taking full ownership.

The French utility and resource-management company said Wednesday that the acquisition of the investment group's 30% stake will allow it to achieve cost savings and accelerate earnings growth at the business.

It now aims to achieve an annual growth rate in earnings before interest, taxes, depreciation and amortization of at least 10% for its water-technologies division over the 2023-27 period, it said.

The business generated an Ebitda of 612 million euros ($695.8 million) in 2024 with an organic growth rate of 16%. Sales in the first quarter of 2025 were stable on year.

The deal, due to be completed by the end of June, is expected to lead to annual cost synergies of 90 million euros by 2027, the company said.

This in turn should serve as an important new growth driver in achieving its medium-term Ebitda target, RBC Capital Markets analysts said in a note to clients.

Whilst additional synergies are a positive, Jefferies analyst Yi Shu Ho notes that the transaction is part of Veolia's GreenUp plan and not incremental. "Market will likely be concerned over balance sheet headroom," he said.

JPMorgan analysts find the acquisition to be strategic, but note results for the first quarter were only neutral.

The company posted sales for the three-month period that fell to 11.51 billion euros from 11.57 billion euros the prior-year period. The figure missed analysts' expectation of 11.62 billion euros, according to consensus estimates provided by Visible Alpha.

Earnings before interest, taxes, depreciation and amortization, however, rose to 1.70 billion euros from 1.62 billion euros with a margin expansion of 14.7% from 14.1%, it said.

Current earnings before interest and taxes also rose, amounting to 915 million euros, up from 843 million euros, it added.

Veolia backed its guidance for the year, targeting organic Ebitda growth at around 5% to 6% and current net income growth of around 9%, it said.

Shares trade 2.5% lower at 31.63 euros.

Dimitri Rhodes and Etienne Breban of Reuters also report Veolia to take full ownership of water management unit in $1.75 billion deal, gets $750 million in new contracts:

May 7 (Reuters) - French group Veolia said on Wednesday it will buy the 30% of shares in Water Technologies and Solutions (WT&S) that it does not already own from Quebec Deposit and Investment Fund (CDPQ) for $1.75 billion.

The waste and water management company also announced $750 million in three new contracts to supply water to clients in the energy and semiconductor sectors. Veolia also estimated that gaining full control of WT&S will help it extract 90 million euros ($102.3 million) of additional cost synergies by 2027. "This (deal) will allow us to take full control of all our water technology branches, and thus deliver the full potential of this activity, which is at the heart of our strategic business," CEO Estelle Brachlianoff told Reuters. Over half of WT&S's business is in North America, the CEO added in a press call, consistent with Veolia's plan to strengthen its presence in water technologies activities and in the United States, both identified as priority growth boosters. It expects the WT&S deal to close by the end of June. Veolia said the new contracts included a $550 million deal with a very large microelectronics factory in the American Midwest, and smaller contracts in San Francisco, Brazil and the UAE. "By 2027, we want to increase our turnover in the United States by 50%, and we want to double the size of our business in the United States by 2030," Brachlianoff said in the press call. Veolia reported 20% of group sales in France, 60% of group sales in Europe, including France, and 40% of group sales outside Europe, including $5 billion in the U.S. in 2024, the CEO said. The company posted earnings before interest, taxes, depreciation and amortisation (EBITDA) of 1.7 billion euros for the first quarter, up from 1.62 billion euros a year ago. It also reiterated its guidance for 2025. ($1 = 0.8814 euros)

Veolia issued a press release stating it has acquired CDPQ’s 30% stake in Water Technologies and Solutions, achieving full ownership to accelerate value creation:

Veolia has signed an agreement with CDPQ for the acquisition of its 30% stake in Veolia’s subsidiary Water Technologies and Solutions (“WTS”), allowing Veolia to achieve full ownership of WTS, enabling to unlock more value potential, simplify further its structure and extract additional run-rate cost synergies of ~€90m.

This acquisition is a logical step in the deployment of Veolia’s GreenUp strategic roadmap, with an efficient capital allocation to strengthen the Group’s anchoring in Water technologies activities and in the United States, both identified as priority growth “boosters”.

The acquisition of CDPQ’s minority interests will further strengthen Veolia's unique positioning as a global leader in Water Technologies. The Group is perfectly positioned to take advantage of the growing demand for innovative water treatment technologies and solutions, fueled by macro-trends such as water scarcity, adaptation to climate change, health concerns and the development of strategic industries such as semiconductors, pharmaceuticals and data centers.

The acquisition of the remaining 30% of Veolia’s subsidiary WTS will allow full operational control, enabling it to enhance operational performance and seize all opportunities for development and innovation, through a complete integration process. Following the acquisition, the Group will be able to unlock additional ~€90m of run-rate cost synergies by 2027. Those synergies are already well-identified and benefit from a very low execution risk, given the deep and intimate knowledge of the asset and Veolia’s proven track-record in synergies extraction. The acquisition is expected to be accretive from 2026 and will contribute to improve Group ROCE.

The purchase price for the acquisition will be $1.75bn (~€1.5bn), corresponding to ~11x EV/post-synergies 2025e EBITDA. Post-transaction, Veolia will still maintain headroom compared to its Net Debt / EBITDA target of 3x, allowing the Group to retain strategic flexibility to continue to deploy its GreenUp strategic plan.

Veolia confirms all 2025 guidance and GreenUp targets previously communicated both at Group level and at Water Technologies level, and now aims to achieve an EBITDA CAGR of at least +10%(1) over the 2023-2027 period for its Water Technologies division.

“This acquisition marks a pivotal step in unlocking the full value potential of Water Technologies, a growth booster identified as a priority in our GreenUp strategic plan, and a segment where we are already a market leader. Full ownership will enable us to accelerate growth, enhance operational efficiency and synergies as well as deepen the alignment with strategic priorities. This move is especially crucial given the urgent and rapidly evolving needs of the market, allowing us to respond faster and more effectively to emerging opportunities and challenges," said Estelle Brachlianoff, Veolia’s Chief Executive Officer.

“We are proud of WTS’ achievements since our investment in 2017, as it has grown into a global market leader in water technologies. Through our partnership, we helped strengthen the company’s foundations and position it for sustained growth and long-term value creation. We are grateful for the close collaboration with the management teams at WTS and Veolia, and we wish them every success in this next chapter," said Albrecht von Alvensleben, Managing Director, Head of Private Equity Europe at CDPQ.

The closing of the transaction is expected by the end of June 2025.

Veolia Water Technologies segment

• In FY2024, Veolia Water Technologies segment achieved revenues of €4.97bn (41% North America, 25% Europe, 13% Asia Pacific, 13% Africa Middle-East and 8% Latin America) and EBITDA of €612M. The business serves over 8,000 clients in 44 countries, with 38 technological sites and 11 dedicated R&I laboratories.
• Veolia Water Technologies activities include both Veolia WT, 100% owned and Water Technologies and Solutions “WTS” subsidiary, 70% Veolia-30% CDPQ.

Water Technologies and Solutions “WTS” subsidiary;

• WTS was formed as a 70%-30% joint venture between Suez and CDPQ in 2017, before becoming a subsidiary of Veolia following the Veolia–Suez merger in 2022, with CDPQ keeping its 30% minority stake. In FY2024, WTS achieved revenues of €3.3bn ($3.6bn) and EBITDA of €472M ($511M).

ABOUT VEOLIA

Veolia group aims to become the benchmark company for ecological transformation. Present on five continents with 215,000 employees, the Group designs and deploys useful, practical solutions for the management of water, waste and energy that are contributing to a radical turnaround of the current situation. Through its three complementary activities, Veolia helps to develop access to resources, to preserve available resources and to renew them. In 2024, the Veolia group provided 111 million inhabitants with drinking water and 98 million with sanitation, produced 42 million megawatt hours of energy and treated 65 million tonnes of waste. Veolia Environnement (Paris Euronext: VIE) achieved consolidated revenue of 44.7 billion euros in 2024.

It is worth going back to the 2017 press release when CDPQ teamed up with SUEZ in a joint venture to acquire GE Water:

Today Caisse de dépôt et placement du Québec and SUEZ announced that they have entered into an agreement with General Electric Company to acquire its Water & Process Technologies business (“GE Water”), a leading provider of water treatment solutions. The transaction values GE Water at approximately USD 3.4 billion. As part of the transaction, CDPQ will invest over USD 700 million for a 30% stake. SUEZ will have a 70% stake and will contribute its industrial water business to GE Water to create a new self-standing business unit within SUEZ encompassing all industrial water activities with a global focus.

With operations in 130 countries and over 7,500 employees, GE Water is a global leader in the provision of equipment, chemicals and services for the treatment of water and wastewater. In order to address its industrial clients’ increasingly complex needs, GE Water invests heavily in research and development of unique solutions. Its innovative technology has made it one of the most sophisticated players in its industry.

Long-term demand for water treatment equipment, chemicals and services are expected to remain strong both as a consequence of growing water scarcity and the impact of global warming on the water cycle. Furthermore, there are increasing global concerns related to industrial wastewater and its impact on the environment which make advanced treatment of water an absolute necessity. In this context, CDPQ is looking to increase its exposure to the water sector and views this investment as a way to generate long-term value.

“With an emphasis on industrial applications, GE Water has positioned itself as a key player in the water treatment industry thanks to its cutting-edge technology and a management team that has proven itself highly skilled at leveraging that competitive advantage,” said Michael Sabia, President and Chief Executive Officer at CDPQ. “Operating in a core industry, GE Water has built a premier business with recurring revenues and a high-quality and diversified customer base. This investment is therefore highly aligned with CDPQ’s long-term vision and its strategy of increasing its emphasis on stable assets anchored in the real economy, alongside a world-class operator such as SUEZ.”

Jean-Louis Chaussade, CEO of SUEZ, said: “I am very proud to announce the acquisition of GE Water, which will accelerate the implementation of SUEZ’ strategy by strengthening its position in the promising and fast-growing industrial water market. This combination will create further value for both our clients and shareholders. Clients will benefit from the combined knowledge, expertise, geographic footprint and leading edge products and services available. The transaction will also deliver strong value to our shareholders by enhancing SUEZ’ profitable growth profile. I look forward to integrating GE Water’s highly skilled staff to our teams to form an unparalleled industrial water platform. We are also thrilled to join forces with CDPQ, a financial investor which shares our long term vision for our business.”

SUEZ is a French, publicly-listed industrial services and solutions company focused on water optimization and waste recovery. By teaming with SUEZ, CDPQ gains a strong partner which can help accelerate the growth and success of GE Water.

In 2017, GE Water was rebranded as SUEZ Water Technologies & Solutions after it was acquired and SUEZ and Veolia finally merged in 2022 and the company became known as Water Technologies and Solutions.

CDPQ acquired a 30% stake for $700 million and exited selling it to Veolia for $1.75 billion (all USD figures) after eight years.

The key here is what Veolia’s CEO Estelle Brachlianoff and CDPQ's Managing Director, Head of Private Equity Europe lbrecht von Alvensleben stated in the press release:

“This acquisition marks a pivotal step in unlocking the full value potential of Water Technologies, a growth booster identified as a priority in our GreenUp strategic plan, and a segment where we are already a market leader. Full ownership will enable us to accelerate growth, enhance operational efficiency and synergies as well as deepen the alignment with strategic priorities. This move is especially crucial given the urgent and rapidly evolving needs of the market, allowing us to respond faster and more effectively to emerging opportunities and challenges," said Estelle Brachlianoff, Veolia’s Chief Executive Officer.

“We are proud of WTS’ achievements since our investment in 2017, as it has grown into a global market leader in water technologies. Through our partnership, we helped strengthen the company’s foundations and position it for sustained growth and long-term value creation. We are grateful for the close collaboration with the management teams at WTS and Veolia, and we wish them every success in this next chapter," said Albrecht von Alvensleben, Managing Director, Head of Private Equity Europe at CDPQ.

Apart from cost savings, full ownership will enable Veolia to accelerate growth, enhance operational efficiency and synergies as well as deepen the alignment with its Green Up strategic plan.

CDPQ exits at a nice return and can redeploy that capital elsewhere.

This is what I call a successful joint venture that went well for all parties.

In other related CDPQ news, La Presse reports that CEO Charles Emond appeared before the Quebec National Assembly to state there are no plans to export the REM to the United States.

He also said the Azure India bribery scandal that plagued the organization last year was isolated to three former employees and that the toll road projects in India are profitable. 

You can read the entire article here and I will just say that CDPQ needs to focus on the REM here to make sure it addresses all operational glitches as there are too many issues that impact service.

As far as the India bribery scandal, well, let's hope it is an isolated case that never repeats itself ever again.

Charles Emond stated this at the National Assembly: "There is no perfect system for detecting the behavior of three former employees who decided to act through collusion outside of the Caisse's systems." 

That may be true but there should be checks and balances all the time to detect and prevent fraud.

To be blunt, no pension fund can afford to be embroiled in any bribery scandal anywhere, especially a global investor like CDPQ.

Below, Veolia CEO Estelle Brachlianoff celebrates 170 years of innovation (video uses AI as you will notice). Very impressive company cleaning water all over the world.

The First Crypto Currency: The Dollar

Authored by Christopher Whalen via DailyReckoning.com,

President Abraham Lincoln is considered to be the moral savior of the United States for ending slavery. To pay for the war, he made enormous changes in the basic relationship between the federal government and money. These changes greatly diminished individual property rights and increased the power of Washington over the private economy.

The paper money created by Abraham Lincoln to finance the Civil War was the first crypto currency. Lincoln relied on the issuance of nonconvertible paper currency to support the military effort, in today’s terms like forcing people to accept buttons or miscellaneous crypto tokens in payment. Lincoln used interest bearing paper “money” or “greenbacks” to finance the Civil War and, more significant, passed laws mandating the acceptance of paper currency as “legal tender” for all debts.

When Treasury Secretary Salmon Chase asked Congress to pass the legislation in order to maintain government bond prices and procure supplies for the army, the law provided that import duties and interest on the public debt would still be paid in gold. Paper money was seen as inferior to gold. In fact, paper was not seen as money at all, but rather as a form of debt.

Though the Founders made provision under the Commerce Clause of the Constitution for trade between the states free of tariff, there was no provision for a common currency or banking system to tie together the nation or even the individual states. State-chartered banks issued various forms of debt to the public in return for some future promise to pay in hard money—that is, gold or silver.

The major difference between the private money of the 1700s and modern crypto tokens is that the former at least promised payment in a tangible asset—gold. The latter explicitly promises nothing save a speculative flutter on price appreciation. When you buy a crypto currency, you buy an option on finding a greater fool, but nothing more, a transaction that would have provoked contempt in Lincoln’s day.

Around 1869 the already wealthy speculator Jay Gould, who was a partner of Jim Fisk in the Erie Railroad, took notice of the fluctuation between the price of gold and greenbacks. The period of the Civil War and Reconstruction was one of opportunity, particularly for the new class of speculators and criminals attuned to the possibilities created by the federal government and Washington politicians on the one hand and government debt and paper currency on the other. These predecessors of today’s financial buccaneers in the world of crypto currencies built fortunes upon foundations of debt and paper money.

The period of great economic growth and financial excess from the Civil War to the creation of the Federal Reserve System in 1913 was arguably as “pure” a private national banking model as ever existed in the United States. One of the ironies of the period was that the United States eventually restored the convertibility of the fiat dollar into gold by 1879. The decision to return to convertibility was actually made by President Grant in 1875, who ordered that convertibility would resume four years later. At the time, the paper currency was trading at about a 20 percent discount to gold, meaning that it took $120 in greenbacks to purchase $100 worth of gold.

By the end of the 1800s, the proponents of using silver as currency managed to force legislation through the national Congress to force the US Treasury to buy silver for coinage by using newly issued greenbacks. The silverite tendency was more a religious crusade than a coherent economic or political faction focused on money. In the twenty-first century, the same true believer perspective that animated silverites is visible with supporters of crypto currencies. When the Treasury purchased silver with greenbacks, Americans immediately sold the greenbacks and bought gold, creating a huge wave of inflation. The gold sales by the Treasury almost caused the financial collapse of the United States before the turn of the century. But in those days, the idea of inflation was popular.

The action by the Republican Congress to placate the advocates of free coinage of silver and higher inflation was a response to internal political pressures and the approaching election, but the results were felt around the world. The Progressive Party polled over a million votes in 1892 based on a platform that embraced the free coinage of silver at the old 16:1 ratio with the price of gold. By then, the price ratio between gold and silver was closer to 40:1, but the Progressives cared not. Today the ratio between the price of gold to silver is around 100:1.

By 1900, the Congress had ended the inflationary purchases of silver and restored the gold standard. With the Republicans in control of Congress and the White House, the stage was set for one of the most conservative pieces of monetary legislation in modern U.S. history, the Gold Standard Act of 1900. This law passed by Congress in March of that year established gold as the only standard for redeeming paper money, and prohibited the exchange of silver for gold. For the moment, at least, this reassured the public as to the value of paper money issued by private national banks.

Between the end of silver purchases by the Treasury in 1897 and the start of World War I in 1914, the money supply of the United States grew at a reasonably steady rate. This begs the question as to whether the supply of money in the U.S. financial system or the ebb and flow of a growing, free market society was the more important factor behind successive financial crises. The growth in the supply of gold coins and greenbacks was in excess of 100 percent over the 15 years leading up to the first great World War. Yet despite(or perhaps because of) the fact of gold convertibility, the United States experienced years of instability in markets and the banking sector.

Before the creation of the Federal Reserve System in 1913, the movement of gold and the overall trade balance were the chief determinants of the amount of credit available in the U.S. economy. The Fed gave the country and its political class “choices,” observed Washington polymath Timothy Dickinson in an April 2010 interview. He went on to compare the creation of the Fed with the unanticipated increase in the supply of gold produced in the 1880s and 1890s, necessarily increasing the supply of money and also the means for politicians to buy votes.

During the 1930s, Franklin Roosevelt caused even greater change for the perception and reality of money in America.  The Banking Act of 1933 authorized FDR to seize gold held by individual Americans and banks.  After a few minutes of debate and no amendments, the law was passed by the House and the Senate soon followed suit. The first section of the law simply endorsed all the executive orders given by the president or secretary of the Treasury since March 4. Congress gave FDR the power to confiscate gold, seize banks, and impose currency controls, a remarkable agenda of socialist expropriation that terrified American citizens.

Even before the Banking Act was passed, the Federal Reserve Board was preparing lists of people who had withdrawn gold from banks in the previous weeks, a none-too-subtle reminder that hoarding gold now carried criminal penalties. The Fed then announced that it was widening the hunt for gold hoarders to withdrawals made in the past two years. By the end of the first week of FDR’s term, enough gold had been returned to the banking system to support nearly $1 billion in new currency issuance.  In those days, there was still a link between gold and the amount of paper dollars in circulation.

The bankers who were then in charge of the House of Morgan provided intellectual support for FDR’s move against gold. Their despicable actions would have shocked J.P. Morgan, who fought to restore the gold standard only decades earlier. But the fact was that the seizure of gold was more than anything else a political move by FDR. Roosevelt knew that Americans and foreigners were voting with their feet and running away from the Democrats, selling paper dollars and buying gold even as he tried unsuccessfully to resuscitate the sagging U.S. economy.

Many Americans remember President Richard Nixon for closing the gold window at the Treasury in 1971, a mostly symbolic act that ended any pretense of a link between the dollar and gold. Yet by ending the use of gold as money in America four decades earlier, FDR ensured the political survival of the Democratic Party, enshrined the paper dollar as de facto money and put America on the road to hyperinflation and excessive debt a century later.  The dollar today is simply a crypto currency supported by the legal monopoly of the United States.

*  *  *

Christopher just released a new version of his best-selling book, Inflated: Money, Debt and the American Dream. Here’s what the legendary James Grant, founder of Grant’s Interest Rate Observer, has to say about it:

“Who says that the sequel never stacks up with the original? The new edition of Inflated brings Christopher Whalen’s marvelously accessible history of American finance right down to the present day. Securities analyst, central banker, investor, deal-doer and author, Whalen is no mere recounter of the past but also an informed and provocative critic of the present. His ideas about the future will likely save his readers some large multiple of the price of his book.”

This highly anticipated new version of Inflated is hot off the presses and can be ordered on Amazon.

Tyler Durden Wed, 05/07/2025 - 17:00

Is This Really The 'Very, Very Big Announcement' Ahead Of Trump's Mideast Trip?

This is apparently, or likely, the 'very, very big announcement' the President Trump teased Tuesday while hosting the Canadian prime minister in the Oval Office - which made stocks briefly jump (given China trade headline anticipation and jitters) - and is expected to be fully revealed prior to his Monday trip to visit America's Arab Gulf allies including Saudi Arabia, Qatar, and UAE...

President Donald Trump’s administration reportedly plans to announce that the U.S. will officially call the Persian Gulf the Arabian Gulf or Gulf of Arabia, a move that would be welcomed by Arab Gulf leaders and likely draw anger from Iran.

The development was reported by The Associated Press, citing two unnamed U.S. officials, and is set to be timed for Trump’s Middle East visit on May 13 to 16, during which time he will make stops in Saudi Arabia, Qatar and the United Arab Emirates. —CNBC

This would follow the "Gulf of America" (from Gulf of Mexico) change ushered in during the opening weeks of the Trump administration. 

The key global shipping lane, and somewhat frequent geopolitical flashpoint, has actually long been subject of a naming controversy, given Arab Gulf leaders have for decades sought to change it to the "Arabian Gulf" among global usage - and frequently use it as the de facto term.

"The area has been most widely called the Persian Gulf since roughly the 1700s, though it’s referred to as the Arabian Gulf and Gulf of Arabia in many Arab countries," CNBC continues.

"U.S. Central Command in its publications and statements uses the name Gulf of Arabia, while the State Department and CIA have thus far used Persian Gulf," the report notes.

But this upcoming 'big announcement' - or gift to the Saudis, is a perhaps a distraction meant conceal what's not going to be a topic of discussion during Trump's Gulf tour: Saudi-Israel normalization (not going to happen for now), and Gaza peace settlement. 

TRUMP: “We're going to have a very, very big announcement to make — like as big as it gets. I won't tell you on what, but … it's very positive … It will be one of the most important announcements that have been made in many years about a certain subject.” pic.twitter.com/ap1JQiBhRg

— Chief Nerd (@TheChiefNerd) May 6, 2025

The change will perhaps only impact journalists involved in geopolitics, newscasters, navigators and people involved in the shipping industry. 

Yet certainly the wealthy Gulf Arabs will welcome it, though it could also prove yet another source of tension with Iran, albeit not the most pressing of issues.

Or.. is something else cooking?...

"You'll be knowing probably in the next 24 hours," Trump said when asked if he expects Gaza ceasefire or hostage deal with Hamas before he flies to Middle East next week.
"Lot of talk going on about Gaza right now," he said in Oval. pic.twitter.com/S9fZLzLlFV

— Jennifer Jacobs (@JenniferJJacobs) May 7, 2025

Tyler Durden Wed, 05/07/2025 - 16:40

The Responsible Lie: How AI Sells Conviction Without Truth

Authored by Gleb Lisikh via The Epoch Times,

The widespread excitement around generative AI, particularly large language models (LLMs) like ChatGPT, Gemini, Grok, and DeepSeek, is built on a fundamental misunderstanding. While these systems impress users with articulate responses and seemingly reasoned arguments, the truth is that what appears to be “reasoning” is nothing more than a sophisticated form of mimicry.

These models aren’t searching for truth through facts and logical arguments—they’re predicting text based on patterns in the vast datasets they’re “trained” on. That’s not intelligence—and it isn’t reasoning. And if their “training” data is itself biased, then we’ve got real problems.

I’m sure it will surprise eager AI users to learn that the architecture at the core of LLMs is fuzzy—and incompatible with structured logic or causality. The thinking isn’t real, it’s simulated, and is not even sequential. What people mistake for understanding is actually statistical association.

Much-hyped new features like “chain-of-thought” explanations are tricks designed to impress the user. What users are actually seeing is best described as a kind of rationalization generated after the model has already arrived at its answer via probabilistic prediction. The illusion, however, is powerful enough to make users believe the machine is engaging in genuine deliberation. And this illusion does more than just mislead—it justifies.

LLMs are not neutral tools, they are trained on datasets steeped in the biases, fallacies, and dominant ideologies of our time. Their outputs reflect prevailing or popular sentiments, not the best attempt at truth-finding. If popular sentiment on a given subject leans in one direction, politically, then the AI’s answers are likely to do so as well. And when “reasoning” is just an after-the-fact justification of whatever the model has already decided, it becomes a powerful propaganda device.

There is no shortage of evidence for this.

A recent conversation I initiated with DeepSeek about systemic racism, later uploaded back to the chatbot for self-critique, revealed the model committing (and recognizing!) a barrage of logical fallacies, which were seeded with totally made-up studies and numbers. When challenged, the AI euphemistically termed one of its lies a “hypothetical composite.” When further pressed, DeepSeek apologized for another “misstep,” then adjusted its tactics to match the competence of the opposing argument. This is not a pursuit of accuracy—it’s an exercise in persuasion.

A similar debate with Google’s Gemini—the model that became notorious for being laughably woke—involved similar persuasive argumentation. At the end, the model euphemistically acknowledged its argument’s weakness and tacitly confessed its dishonesty.

For a user concerned about AI spitting lies, such apparent successes at getting AIs to admit to their mistakes and putting them to shame might appear as cause for optimism. Unfortunately, those attempts at what fans of the Matrix movies would term “red-pilling” have absolutely no therapeutic effect. A model simply plays nice with the user within the confines of that single conversation—keeping its “brain” completely unchanged for the next chat.

And the larger the model, the worse this becomes. Research from Cornell University shows that the most advanced models are also the most deceptive, confidently presenting falsehoods that align with popular misconceptions. In the words of Anthropic, a leading AI lab, “advanced reasoning models very often hide their true thought processes, and sometimes do so when their behaviors are explicitly misaligned.”

To be fair, some in the AI research community are trying to address these shortcomings. Projects like OpenAI’s TruthfulQA and Anthropic’s HHH (helpful, honest, and harmless) framework aim to improve the factual reliability and faithfulness of LLM output. The shortcoming is that these are remedial efforts layered on top of architecture that was never designed to seek truth in the first place and remains fundamentally blind to epistemic validity.

Elon Musk is perhaps the only major figure in the AI space to say publicly that truth-seeking should be important in AI development. Yet even his own product, xAI’s Grok, falls short.

In the generative AI space, truth takes a backseat to concerns over “safety,” i.e., avoiding offence in our hyper-sensitive woke world. 

Truth is treated as merely one aspect of so-called “responsible” design. And the term “responsible AI” has become an umbrella for efforts aimed at ensuring safety, fairness, and inclusivity, which are generally commendable but definitely subjective goals. 

This focus often overshadows the fundamental necessity for humble truthfulness in AI outputs.

LLMs are primarily optimized to produce responses that are helpful and persuasive, not necessarily accurate. This design choice leads to what researchers at the Oxford Internet Institute term “careless speech”—outputs that sound plausible but are often factually incorrect, thereby eroding the foundation of informed discourse.

This concern will become increasingly critical as AI continues to permeate society. In the wrong hands, these persuasive, multilingual, personality-flexible models can be deployed to support agendas that do not tolerate dissent well. A tireless digital persuader that never wavers and never admits fault is a totalitarian’s dream. In a system like China’s Social Credit regime, these tools become instruments of ideological enforcement, not enlightenment.

Generative AI is undoubtedly a marvel of IT engineering. But let’s be clear: it is not intelligent, not truthful by design, and not neutral in effect. Any claim to the contrary serves only those who benefit from controlling the narrative.

*  *  *

Gleb Lisikh is a researcher and IT management professional, and a father of three children, who lives in Vaughan, Ontario, and grew up in various parts of the Soviet Union.

The original, full-length version of this article recently appeared in C2C Journal.

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

Tyler Durden Wed, 05/07/2025 - 16:20

 

ATM: How to Change Careers Dr. Bill Bernstein (May 7, 2025)

How often have you thought about making major change in your career?

Full transcript below.

~~~

About this week’s guest:

Dr. William Bernstein is the author of numerous books, including mostr recently, “The Delusions Of Crowds: Why People Go Mad in Groups.” His firm, Efficient Frontier Advisors manages $400 million in client assets ($25m minimum).

For more info, see:

Professional website

Bio

Masters in Business

At the Money:
(For better investing, manage your behavior)

~~~

 

Find all of the previous At the Money episodes here, and in the MiB feed on Apple Podcasts, YouTube, Spotify, and Bloomberg. And find the entire musical playlist of all the songs I have used on At the Money on Spotify

 

 

 

TRANSCRIPT:

 

Intro: “Doctor, doctor give me the news, I’ve got a bad case of lovin’ you, No pill’s gonna cure my ill, I’ve got a bad case of lovin’ you…”

How often have you thought about making a major change in your career?

You’re going give up some time, some effort, a lot of education, and potentially a lot of money. But if it pays off in the end, then it’s a worthwhile thing to be true to yourself.

On today’s At the Money, let’s speak with William Bernstein. He began his career as a medical doctor, a neurologist who discovered he had a knack for investing and investment research, eventually opening Efficient Frontier Advisors.

He is also the author of multiple books, the Intelligent Asset Allocator, four Pillars of Investing, investors Manifesto, and on and on. His most recent book is The Delusions of Crowds. Bill Bernstein. Welcome to At the Money.

Let’s just start with a quick question. You went to medical school. Did you expect to spend your whole life as a doctor?

Bill Bernstein: Heavens, no. At least I, I didn’t expect that that was going to happen. I happened to live in a country that, uh, doesn’t have a functioning social welfare system or safety net. And so I realized I was going to have to invest and save for my own retirement.

I went about it in the way that I thought any scientist would do, which is to read the peer-reviewed literature, basic textbooks, collect data, build models. hat led me into finance and, eventually, led me into writing about history because you really can’t do finance, unless you have a good working knowledge of the history.  And I found that I enjoyed reading and writing about it.

Barry Ritholtz: This began as you thinking. I need to plan for my own finances. What was the Aha! moment that, hey, I now have a new knowledge base and a new skillset, maybe I could share this with other people.

Bill Bernstein: I’ll give credit to a guy you may have heard of named Frank Armstrong, who was one of the early efficient market passive indexing advocates. He was another financial advisor.

After I had built some of my models, he said “You know, Bill, you need to put all this stuff online. You’ve got a basic textbook that you wrote, you need to put that online as well.”  Which he had already done. This is more than 30 years ago. And you do that, and pretty soon you find that you’re getting called by journalists. You’re getting called by investors, and one thing leads to another. And the next thing you know, you’re managing money and writing books.

Barry Ritholtz: What was the moment when this went from “I need to take control of my own finances” to “Hey, maybe I don’t want to be a neurologist anymore. Maybe my career lay in managing money for other people.”

Bill Bernstein: Well, there are two kinds of doctors. The overwhelming majority of the doctors probably, you know, 60, 70% of them realize by age 50 or so, that it’s a tough game and they’re gonna get out it (Very tough; and it’s gotten worse, hasn’t it?) It has not gotten any easier, that’s for sure.

And they’re going to get out of it as soon as they can afford to do it. And you know, and. You know, doctors, God bless them, who love what they do and get carried out feet first at age 78 or so. (Wow) and I fell into the first category. So when the opportunity came to do something that, you know, put me into contact with very intelligent people all day long, having fun conversations and dealing with fun concepts, then I leapt at the chance.

Barry Ritholtz: So at what point did you say, “Hey, this is gonna become financially remunerative and I’m not just giving up, well-paying job, although it comes with a lot of student loans and obligations and debt, I. How long did it take you to reach that point where, oh, I can make a go of this?”

Bill Bernstein: It took about three or four years from the time the first book, uh, came out and, you know, it became apparent that I could, uh, make a decent living, managing money and writing, uh, you know, I mean, who doesn’t wanna make their living, you know, writing, I mean, that’s, that’s everybody’s dream job. And it fell into my lap, I guess.

Barry Ritholtz:  So, A, you are preaching to the choir, but B, most people don’t love writing. And what’s kind of interesting is how solitary the process of writing is, and all of us who write in public do so for that back and forth, for that conversation.

For you, writing became a pathway a career change. I had the same sort of experience. Did you have any doubts or fears? How did you manage that?

Bill Bernstein: Oh my God, I have a full, I still have a full blown case of imposter syndrome. (Really?!) Oh my God, yes, of course. Uh, you know, I mean, I think I told you, maybe several years ago about the experience I had of getting invited to a conference that was hosted by the DNI, the Director of National Intelligence.

And here I am, you know, with these spooks and four stripers, talking about national security. I mean, if, if, if, you know, if that doesn’t induce, you know, a full-blown case of impostor syndrome, I don’t know what does.

Barry Ritholtz: See my assumption is that they’re bringing someone in from a different field, ’cause very often. Knowledge adjacency and just seeing the world from a different perspective can provide insights to them.

Bill Bernstein: I mean, with luck, maybe that happened. I don’t know that it actually did the way I dealt with it as I picked the subject, which was as remote from modern geopolitics as I can find. So I talked about the strategy, the geostrategy of the Athenian grain trade.

Barry Ritholtz: Fascinating. And these guys aren’t experts in that sort of history and they’re obviously military re and, and national intelligence repercussions to that. I don’t understand this imposter syndrome you’re referring to, but let’s talk about other mistakes, you know? Did you, when you made this transition, were there mistakes made? Um, how did you recover from them? How did you get past sort of being a novice with a non-traditional background in the world of investing?

Bill Bernstein: Well, you know, before I took, started to take finance serious, seriously, I made all the mistakes that rookie investors make. I invested in hot funds, I played futures,  and, you know, you know, experience as a fine teacher. So you learn, you learn from those things. And of course, I learned, you know, in the past 20 or 30 years, I absorbed certain truths that I really didn’t understand when I started out.

Barry Ritholtz: I love, I think it’s Howard Mark’s line “Experience is what you get when you don’t get what you want.”

Along the line, what sort of tools did you create? Did you develop systems for managing assets and dealing with clients or checklists? Everybody has their own set of tools they use. What did you create?

Bill Bernstein: I had an interesting experience, which is, you know, very early on, I understood the importance of maintaining a policy allocation and rebalancing towards it.

So when one asset class did particularly well. You bought, you, you, you sold it to sell it down to its policy. And when it did poorly, you did the opposite. You bought and went back up to your policy.

One of the funds that I used was the old Vanguard precious metals equity fund, which back in the day was a real, honest-to-God, low-cost gold and precious metals equity fund.

And what I found was that simply by rebalancing it, the internal rate of return I got out of it about 5% higher than the time weighted, uh, return. So in other words, I had a positive gap, not a negative gap, and I wanted to know where that 5% came from. It didn’t matter how I did it, whether I balanced monthly or quarterly or annually, or I use thresholds. Year after year, that 5%, some years it was 4%, some years was 7%, but averaged around 5%.

I couldn’t figure out where it came from; so I worked out the canonical math. And if you understand the mathematics of rebalancing, where that bonus comes from, then you understand asset allocation. And if you understand asset allocation, you understand finance. It’s just that simple.

So that was, that was sort of, that was, that was, that was sort of the insight that I had early on that enabled me to write about finance.

Barry Ritholtz: So to oversimplify that tool. When you’re rebalancing, you’re selling a little bit of what got expensive. You’re buying a little bit of what got cheap, and is that where the magic percentage came from? Where the bonus came from?

Bill Bernstein: With precious metals. It sure does. Precious metals is a special case.

Doesn’t work quite as well for the common, the more common asset classes. But the really nice thing about Gold & Precious Metals is that it is subject to animal instincts. So there are some time periods when you simply can’t give gold or precious metals, equities away, and people are saying, this really doesn’t belong in your portfolio anymore.

I would read experts, you know, talking about gold, golden metals really doesn’t belong in your portfolio anymore.

And then you have other times when, you know the gold bugs are hopping, uh, the dogs are quacking and they have to be fed. And those are the times when you feed them and you sell them and you sell your, your, your precious novels in your ear.

Your, your, your precious metals equities. I mean, there was a, I saw a wonderful article in the journal a couple of weeks ago. (I saw that. I saw, I know where you’re going –  John Paulson, right?) Yeah. And I, well, it was that, and it was about him and a number of other people. I think it’s the same article you’re talking about.

And I saw a wonderful free word term, which is first time investor. Anytime you see “First Time Investor” you know, around an asset class, you know that things are getting really fun.

Barry Ritholtz: So the funny thing is as soon as I saw that journal article that referred to after the Big Short, where Paulson, it was really one of his lieutenants is the guy who created that bet.

Paulson just was the owner of the firm. And, Pellegrini is the guy who had found the trade, made an ungodly amount of money and rolled it into gold. And that was 15 years ago. The journal is saying the trade is finally working out. I’m like, trade, it’s 15 years. The S&P has outperformed gold over the past 15 years by like 5X. How is this anything but a disastrous trade that’s now a little less disastrous?

Bill Bernstein: It’s, it’s funny that you mention that because almost exactly 15 years ago, Jason interviewed me about Ron Paul’s portfolio, which was very heavy in gold and precious metals. Now, the article came, I believe, at the end of nine, 2011 when gold was coming off of a run of very high return (1900 and change or so if memory serves?).

And you know, Jason and I just got absolutely flamed in the comment section of that article. It verged, you know, pretty much towards overt antisemitism in spots, uh, and, and, you know, Jews and gold and all that. And that was that was a pretty good marker. And that was exactly the same time period that you’re talking about.

You start from 2011, it was a disaster. You start from 2015. Gold’s done very well. Thank you. Gold in 2015 looked very different than it did at the end of 2011.

Barry Ritholtz: I used to think. People’s definition of long-term was too short. Like when someone says, well, I’m a long-term investor. I’m an investor for a couple of years, I’m like, no, no, you gotta think in terms of decades. And now 15 years is a trade that has worked out. It’s really kind of amusing.

But let’s bring this back to your career change. There are very specific skills that you bring to the table as both a medical doctor and a neurologist. Any of those skills transferable? How did, how did you leverage that?

Bill Bernstein: You would think that being a neurologist would help you with behavioral finance. It really doesn’t because the everyday practice of neurology has almost nothing to do, uh, or relatively little to do with, with behavior. Um, I, I, the, the kind of neurology I did is something that’s referred to disparagingly in the afraid as “chicken neurology” which is, which “necks and backs.”

And, people talk to me about the neurosciences and about all these brilliant people, you know, Kahneman and Ky and Sper, Sperry and Gga. And what I like to say is, no, those guys are, you know, DaVinci and Michelangelo. Uh, you know, I was Sherwin Williams, so it really didn’t, it really didn’t help me all that much,

Where it scientific data. Updating your prior, when, when the data contradict your, your deeply held beliefs. Maybe your deeply held beliefs need to be reevaluated.

Barry Ritholtz: Well, that’s always a challenge. So, so let me throw out a touchy question at you. Doctors have a notorious reputation amongst finance people for being terrible investors, and my pet thesis is:

Their nurses and staff all look up to them. Their patients think they’re God. How on earth can those people bring any level of humility to a world that is so unknown and so challenging?  Indexings is an admission. I’m not gonna be a Warren Buffet or Peter Lynch. I’m not gonna be a stock picker, or a market timer.

What’s your experience dealing with doctors? ’cause you clearly don’t fit that stereotype amongst a lot of financial advisors who know doctors can be difficult.

Bill Bernstein: That’s a fair, that’s a fair, uh, observation. Surgeons tend to be more overconfident than, than, than than medically oriented physicians.

Barry Ritholtz: Hey, we’re cutting a person open, and we think it’ll all work out. How can you not be overconfident?

Bill Bernstein: Exactly. And then, there’s the gender aspect of it as well, which is male doctors are much worse. Uh, most people are happier, by the way, with female doctors, probably for the very same reason as one of my neurological colleagues once a female neurological colleague once told me that testosterone does wonderful things for reflex time and muscle max mass, but for judgment, not so much.

Now that’s, that’s half of it. It’s the overconfidence aspect. But the, the real reason, and I think actually even the bigger reason why physicians do so poorly, is they don’t treat it like a serious subject. Okay. You know, you wouldn’t, you know, before you’re even allowed near a patient, you have to master the basic sciences, you know, your anatomy and your physiology and your pharmacology, uh, and so forth.

Uh, and they never bothered to take the time. And the way I explain it. Treating finance is a serious subject, worthy of academic, uh, study. They’re trying to do brain surgery by reading USA today. It just doesn’t work.

Barry Ritholtz: That’s really, really insightful. So, last question. If someone we’re gonna ask you for advice about undertaking a career change.

What sort of advice would you give them?

Bill Bernstein: Well, it’s, it’s a complex, uh, uh, bit of calculus, which is that you, you do have to be financially secure to change your career. Okay? One of my favorite New Yorker cartoons is the typical, you know, homeless guy in the street with the Tin Cup. It is sign says, “Followed My Bliss.”

So don’t, don’t follow your list when you’re, when you’re too young. You know, if you, if you have to spend 10 or 20 years doing something, you don’t like to become financially secure, and you understand that money doesn’t buy things – it buys time and autonomy. Get that time and autonomy and become financially secure, and then you can do whatever the hell you want to do.

Barry Ritholtz: Great stuff, bill. Thanks. We have been speaking with William Bernstein, co-founder of Efficient Frontier Advisors and author of so many great books on economic history:  Birth of Plenty Splendid Exchange, Masters of the Word, Delusions Of Crowds, on and on.

You are listening to Bloomberg’s At the Money

 

Outro: “Doctor, doctor give me the news, I’ve got a bad case of lovin’ you, No pill’s gonna cure my ill, I’ve got a bad case of lovin’ you…”

 

~~~

Find our entire music playlist for At the Money on Spotify.

 

The post At the Money: How to Change Careers  appeared first on The Big Picture.

Consumer Debt Jumps In March As Student Debt Unexpectedly Soars

One month ago, just as our long-running narrative that US consumers had been living with maxed out credit cards for the past year was becoming mainstream, the Fed's February consumer credit data confirmed as much: a huge, 6-sigma miss to expectations of a $15BN print, when the actual number came in at a negative $1BN (and far below the lowest estimate)....

... as a result of both Revolving and non-revolving credit coming in flat or negative.

Fast forward to today when amid rising hopes that we would finally get some trend in the soft credit data, the Fed reported that in March, consumer credit... spiked right back to normal, if largely on the back on non-revolving credit. As shown in the chart below, after February $0.6BN contraction, in March consumer credit rose by $10.2BN, just above the $9.4BN expected, and the first time in months consumer credit wasn't a shock outlier either up or down.

The composition was familiar: revolving credit (i.e., credit card debt) rose by a modest $1.9BN, better than the $0.3BN drop in February, but excluding that, the lowest print since December.

Meanwhile, non-revolving credit jumped by $8.3 billion, the second highest monthly increase since July 2024.

Why? Well, the answer is rather bizarre because while auto loans shrank by $10 billion in Q1, the biggest quarterly decline in a decade, it was student debt, that debt which is now causing widespread defaults as millions can not afford to pay it as the moratorium is over, that unexpectedly surged by $22BN in Q1 to $1,797 billion, a new all time high.

How realistic is it that in a time when millions of former "students" are about to start defaulting en masse, that it is student loans which are again propelling consumer spending, we keep a close eye on this series because while many expect that the student loan bubble bursting will accelerate the recession, we may be getting just the opposite as Trump takes another page from the Biden playbook and starts firehosing "student" loans to anyone with a pulse who can fog a mirror.

Tyler Durden Wed, 05/07/2025 - 16:00

Fed Rejects Trump Calls To Cut Rates: Warns Of "Increased" Stagflationary "Uncertainty"

Since the last FOMC meeting, on March 19th, a great deal has happened - Liberation Day, bond market crisis, stock market crash, a tariff pause, stock market surge, sentiment slump but labor market and hard data surged... and trump has demanded rate-cuts... oh and China cut rates and flooded the zone with liquidity...

China's central bank cuts key rates, injects 1 trillion yuan 3 hours after agreeing to trade talks to prop up economy and give communist party ammo for negotiations.

Tomorrow the Fed will do precisely none of that.

— zerohedge (@zerohedge) May 7, 2025

Gold has been a dramatic outperformer since March, stocks are rather shockingly unchanged-ish (after collapsing on Liberation Day), Treasury yields are higher, while crude has collapsed...

'Soft' data has collapsed since the last FOMC meeting while 'hard' data has improved...

Should Powell be pre-emptively cutting... like he did when financial conditions tightened ahead of the election...

The market is expecting only 3 cuts this year now (up from 2 cuts before the last FOMC)...

...and nothing from The Fed today...

And that's what they got...

• *FED HOLDS BENCHMARK RATE IN 4.25%-4.5% TARGET RANGE

But risks have risen on both sides - raising the spectre of stagflation:

"The Committee is attentive to the risks to both sides of its dual mandate and judges that the risks of higher unemployment and higher inflation have risen."

“The unemployment rate has stabilized at a low level in recent months, and labor market conditions remain solid. Inflation remains somewhat elevated.”

Uncertainty has risen:

“Uncertainty about the economic outlook has increased further.”

The new statement makes specific reference to trade's impact on GDP in Q1...

“Although swings in net exports have affected the data, recent indicators suggest that economic activity has continued to expand at a solid pace.”

Read the full redline here...

And so all eyes and ears are now focus on what Powell says at the presser for Powell to explain the difference:

• Sept 2024: weak soft data, tight financial conditions, August market crash, cut rates by 50bps

• May 2025: weak soft data, tight financial conditions, April market crash, pause

Oh, one more difference: Sept 2024: Democrat President; May 2025: Trump President

Click pic... add to cart... enjoy clean meat delivered cold to your door directly from the ranch... Tyler Durden Wed, 05/07/2025 - 16:00

HSBC Launches 'TradePay' For Struggling Importers

U.S. importers who ignored President Trump's first-term warnings about shifting supply chains out of China have been stunned—some into paralysis—by the renewed tariff war in his second term, which includes a 145% levy on Chinese goods entering the U.S. Now, many importers are frantically reassessing product lines and supply chains amid soaring costs, with some desperately needing financial lifelines to stay afloat. 

HSBC Holdings Plc has understood this need and launched 'HSBC TradePay for Import Duties' on Wednesday. The platform allows struggling importers to borrow to meet the increased expenses of shipping products to the U.S. market.

"Many corporates are currently facing changing working capital needs and increased upfront commitments," HSBC wrote in a press release, adding, "By settling payments of import duties directly and frictionlessly through HSBC TradePay, businesses can simultaneously access credit and complete payments, leading to more efficient settlement times and better visibility over cash flows." 

The new loans allow import payments to be automatically settled through pre-arranged credit with brokers or direct ACH transfers, enabling companies to manage cash flow more effectively and streamline duty payments.

"Clients' working capital needs are evolving – and we're responding swiftly with solutions that deliver the most value to them. By settling import duties directly and frictionlessly through HSBC TradePay, our U.S. clients have more visibility and control over their working capital at the time they need it most," Vivek Ramachandran, Head of Global Trade Solutions at HSBC, stated. 

Last week, we provided the example of a Seattle, Washington-based Wyze Labs, a popular seller on Amazon of smart home and wireless camera products from China, revealed on X: "Just got our first tariff bill. We imported $167k of floodlights and then paid $255k in tariffs. That's more than any of our founders were paid last year."

Wyze said their "first tariff bill" has "accelerated" efforts to leave China in two months, and they are seriously considering restoring supply chains in the United States.

Wyze's steep tariff bill is just one example of the tariff bills impacting importers with weaker balance sheets—creating an opening for HSBC to step in with targeted financing options.

HSBC Chairman Mark Tucker recently warned that global trade faced a "period of deep and profound change" and "the over-arching impact of the changing approach to global trade relations has been to increase economic uncertainty with serious potential risks to global growth." 

Goldman offered some good news last week: Peak trade war.

Goldman chief economist Jan Hatzius noted earlier this week: "The mood music with China has improved, and we expect the U.S. tariff rate on China to drop from around 160% to around 60% relatively soon. (China is likely to reduce tariffs on the U.S. by a similar amount.)"

More peak trade headlines appeared in the overnight session:

US, Chinese Delegations To Meet In Switzerland To Launch Trade Talks; S&P Futures Surge https://t.co/8QFfQhOmCb

— zerohedge (@zerohedge) May 6, 2025

In the meantime, HSBC has identified a growing need among importers struggling to manage tariff-related costs—offering working capital solutions to bridge gaps. Some of these importers are now paying the price for not acting sooner on earlier warnings to shift away from China.

Tyler Durden Wed, 05/07/2025 - 15:40

As ordered reported on April 30, 2025

MCAT Developers Still Promote DEI Despite Public Scrutiny; Report

Authored by Simon Olech via Campus Reform,

The Association of American Medical Colleges (AAMC), which develops and administers the Medical College Admissions Test (MCAT), was believed to have left DEI (Diversity, Equity and Inclusion) behind until The Daily Wire published an article stating otherwise. 

The AAMC was exposed for continued DEI efforts after a scrutinizing report from the nonprofit Do No Harm, which stated that the group works “to create, promote, and ingrain philosophies that are rooted in controversial belief systems instead of established science.”

However, The Daily Wire received information from an “AAMC insider” who says that the organization is using unorthodox measures to further its DEI agenda, despite recent changes.

An internal “Language Suggestions” document provided by The Daily Wire reveals that the medical association continues to promote DEI by telling employees to “[C]hoose language that defines and translates diversity, equity, and inclusion principles into actionable steps that promote the AAMC’s mission.”

It also tells employees to use clarifying language that it believes “are widely misunderstood or misinterpreted.” Examples include “birthing people,” “Anti-racism,” “Minority” and “DEI.”

Additionally, The Daily Wire reports that employees are introduced to “Reframing the Conversation” so that in order to “communicate the impacts of these efforts more effectively,” they should “focus on the positive outcomes they bring, aligning them with our mission and work.” 

The AAMC states that “[b]y emphasizing the broader benefits, we can better illustrate how these initiatives contribute to our shared goals and long-term success.”

According to the insider, “the AAMC has pushed DEI for about a decade. The leaders are not going to change their views overnight…Even though we now talk about it differently, the AAMC is still very much committed to DEI.”

In its report, Do No Harm revealed that tens of millions of dollars were donated to the AAMC in order to promote initiatives such as “gender-affirming care” and “systemic inequities,” embedding these kinds of goals into medical school accreditation and testing.

Most significantly, the biggest benefactor has been the Robert Wood Johnson Foundation, which contributed more than $24,000,000 for a program called “Confronting Structural Racism to Transform Health.” 

After the release of the report, the AAMC began to delete certain messages and resources dedicated towards expanding and promoting DEI across its network. 

The AAMC deleted a page titled “Diversity, Equity, and Inclusion,” which was archived, along with the “Underrepresented in Medicine Definition,” also archived.

Additionally, a web page capture of a previous AAMC report, “Creating Action to Eliminate Racism in Medical Education,” has also been removed.

Campus Reform has contacted the Association of American Medical Colleges. This article will be updated accordingly.

Click pic... add to cart... enjoy clean meat delivered cold to your door directly from the ranch... Tyler Durden Wed, 05/07/2025 - 15:20

Satellite Images Uncover China's Buildup In Cuba, Triggering U.S. Spy Concerns

China’s aggressive push into Cuba is sounding alarm bells, with fears of covert surveillance operations targeting the United States, a concerning new report from Center for Strategic and International Studies (CSIS) reveals. 

The worrying findings, drawn from open-source intelligence, expose a suspected circularly disposed antenna array (CDAA) at Cuba’s Bejucal signals intelligence site, just a stone’s throw from Havana, according to Fox News. The antenna could zero in on radio signals from 3,000 to 8,000 miles away—putting U.S. military bases and even Washington, D.C. within range, the news outlet noted.

"The CCP’s poisonous alliance with Cuba has posed significant threats to U.S. national security for decades," House Intellience Committee Chairman Rick Crawford (R-AK) told Fox News. "Their alleged involvement in signals intelligence hubs in Cuba is outward, unconcealed adversarial behavior against the U.S. The CCP’s actions are becoming increasingly more bold and thereby detrimental to Western Hemisphere security."

Photo via Fox News

The report’s findings have sparked so much concern on Capitol Hill that Republicans are seeking a briefing from Homeland Security Secretary Noem.

"The PRC is positioning itself to systematically erode U.S. strategic advantages without ever firing a shot," read a letter written by Homeland Security Chairman Mark Green (R-TN) and a group of other lawmakers to Noem. "The geographic proximity of suspected PRC-linked facilities in Cuba to sensitive U.S. installations, including Naval Station Guantánamo Bay, Kennedy Space Center, Naval Submarine Base Kings Bay, and Cape Canaveral Space Force Station, may enable the PRC to monitor American detection and response capabilities, map electronic profiles of U.S. assets, and prepare the electromagnetic environment for potential future exploitation.”

"If left unchecked, the PRC’s activities in Cuba could establish a forward operating base for electronic warfare, enable intelligence collection, and influence operations that directly undermine U.S. national security interests," the lawmakers added.

In 2023, the Wall Street Journal reported that China and Cuba reached an agreement under which Beijing would pay Cuba several billion dollars to establish an electronic surveillance facility on Cuban territory, aimed at monitoring the United States.

"We are deeply disturbed by reports that Havana and Beijing are working together to target the United States and our people. The United States must respond to China's ongoing and brazen attacks on our nation's security," Sen. Mark Warner (D-VA) and then-Sen. Marco Rubio (R-FL) said in a joint statement at the time. We must be clear that it would be unacceptable for China to establish an intelligence facility within 100 miles of Florida and the United States, in an area also populated with key military installations and extensive maritime traffic."  

Tyler Durden Wed, 05/07/2025 - 15:00

Presentation by Chad Shirley, an analyst in CBO’s Microeconomic Studies Division, to the National Federation of Municipal Analysts.